1983-02-04

STATEMENTS PURSUANT TO S.O. 21


Mr. Dave Nickerson (Western Arctic):: Madam Speaker, in the early 1970s thousands of Ugandans of Asian ancestry were expelled from Uganda by Dictator Idi Amin. Many of these people came to Canada and now consider Canada to be their home.
An outstanding question has always been the repossession of property that these people were forced to abandon in Uganda. Kampala has recently announced rules under which such repossession might take place. Apparently, under the proposed rules, ex-Asian Ugandans will have only 90 days to return to Uganda and will then have to remain there for at least five years before being able to dispose of their rightful possessions. For very obvious reasons such a procedure would be unacceptable to people who are now Canadian citizens and wish to remain in Canada. A very similar problem exists with respect to impounded superannuation and insurance funds.
Therefore, the Government of Canada ought to make appropriate representations to the Government of Uganda to ensure fair and timely treatment for Canadian citizens of Asian Ugandan origin.


RAILWAYS
Mr. Gaston Gourde (Levis):: Madam Speaker, in Quebec, all agricultural organizations that were consulted agreed with the need to revise the Crow rate in order to correct railway transportation problems in the West.
First of all, and this is very important, there is now agreement that the measures to be applied in the West will not affect the supply or price of feed grain in Eastern Canada. The reason is simple. The 1974 feed grain policy, recently extended until August 1983, ensures diversity of supply for Quebec feeders. They can buy their feed grain locally or in Ontario,
the U.S. or Western Canada. The Canadian Wheat Board must supply feed grain if the private market does not, and does so at a price determined by the price for U.S. corn.
On December 4, 1982, on Radio-Canada, a spokesman for the FPU said that the price in Eastern Canada is determined by the world market. People in the West would have to adjust to that level, and implementation of the Gilson report would not affect our prices.


THE ECONOMY
Mr. Terry Sargeant (Selkirk-Interlake):: Madam Speaker, many Members of this House, as well as Canadians from coast to coast, were rather taken aback by the tone and substance of a statement released yesterday by five Liberal backbenchers in response to the recent statement on the economy by the Canadian Conference of Catholic Bishops.
It is a sad commentary to see the Government so sensitive to thoughtful criticism of its policies that it must send out a hit team, who used their membership in that same church to justify their advancing the Government's criticism of the Bishops' statement. On the other side of the coin, there are many, many Catholics across Canada who welcomed the Bishops' statement and who support both it and their right to make such a statement. It is disappointing, at a time when Canada is crying out for new directions in its economy, that the Government would react so flippantly to the serious proposals of a major force in our society.
As well, there was a rather disturbing element to yesterday's statement. That was the comparisons used by the Hon. Member for Gloucester (Mr. Breau). To bring into the debate the states of affairs that exist in such extremist regimes as Chile and El Salvador was, I submit, unconscionable. The implied threat that he made by pointing to the assassination of Archbishop Oscar Romero as an example of the results of church involvement in temporal affairs, does a grave disservice to the right of freedom of expression in this country. These five Liberals owe an apology to the Catholic Bishops of Canada, to the Catholics of Canada, and indeed to all Canadians.


Some Hon. Members:: Hear, hear!

February 4, 1983
[DOT] <mo)


EMPLOYMENT
Mr. Jim Hawkes (Calgary West):: Madam Speaker, when we are talking about unemployment among young people in Quebec, we are dealing with a very special problem. Unemployment among this group is now affecting 169,000 people. Last year, young people were losing jobs at a rate of almost
5,000	per month, Madam Speaker, and I believe we have reached a crisis situation in the Province of Quebec and across Canada.

In the last month we have lost 104,000 jobs in this country. In the past 30 days, 52,000 people have stopped looking for work. We have been losing jobs at the rate of 30,000 month in the past year.
I would remind Members of this House that the Clark Government created 40,000 new jobs per month in its brief term in office. If we had had that rate of job creation in the past year, we would have half as few unemployed in Canada at this time.
I urge the Liberals and the New Democrats to swallow their pride and their bad judgment, and to support a budget which has principles and direction which is similar to that of the Clark Government. We need employment.



Mr. Stanley Hudecki (Hamilton West):: Madam Speaker, Mohawk College of Hamilton, a community college, has been a leader and a pioneer in the development of educational systems which involve employers and training of students. One such program is the co-operative education technique whereby technical and business programs are integrated with industry, business and government throughout Canada. This program provides skills and experience for the student, making him or her particularly valuable as a full-time employee.
This system necessitates the co-operation of the employers to provide work experience during the education terms. This system has the merit of providing students with a modified work program on a year-round basis, and takes the pressure off trying to find a job in the summer only.
Since 1978, the Federal Government has provided Mohawk College with seed money to develop such programs, and Mohawk College has received international recognition for the excellence of the work done. However, current economic conditions are such that the employers find it financially difficult to participate in the work study program.
I would therefore like to recommend that the federal and provincial Governments help the youth of this region in preparing themselves for skilled, full-time jobs, by encouraging employers to participate in these work sharing programs, by providing either a direct subsidy or other financial assistance to employers to cover part of the student wages.


FISHERIES
Mr. Rod Murphy (Churchill):: Madam Speaker, today we discovered that the Liberal Government is again stalling in attempting to solve the problems which are very drastic in the Atlantic fishing industry. Over a year ago the Kirby Task Force was instructed to proceed "on an emergency basis". Today we discovered that the Cabinet is again stalling and dividing itself strictly for political reasons.
The New Democratic Party criticizes and deplores the leaking of the Kirby Report instead of the issuing of that full report to the public of Canada. We call on the Government to act in order to protect the incomes and livelihoods of fishermen in Atlantic Canada.
Today we found out that one Cabinet Minister is calling for one Crown corporation to act in this area. Other Cabinet Ministers want to continue the divide and rule regime which exists at the present time. It is time that the policy of the Government, which protects the fishing corporations in Altantic Canada, stopped. It is time that the Government acted. It is time that the Government set up one crown corporation to control marketing and to help increase the income of Atlantic fishermen.


OFFICIAL LANGUAGES
Mr. Geoff Scott (Hamilton-Wentworth):: Madam Speaker, I would like to bring to the attention of the House a truly bizarre situation. I am referring to a flagrant case of discrimination on the part of the Minister of Consumer and Corporate Affairs (Mr. Ouellet), at the UFFI information and cordina-tion centre in Hull. Madam Speaker, the courses providing information on how to remove UFFI are offered in English only. My office has received complaints from a number of francophone UFFI victims who were told that the course at the centre were in English only, and that French instruction brochures could be mailed to their home adress. I find this incredible, Madam Speaker. A large number of buildings that have been affected by UFFI are located in Quebec. The UFFI
February 4, 1983

information and co-ordination centre is located in Quebec. Furthermore, one of the Ministers responsible for this Government's affairs in Quebec is also responsible for UFFI, and he is tolerating this kind of discrimination in his own province. If the Government thinks Canadians should have the right to communicate in the language of their choice, it should start by applying this policy to our Federal institutions in Quebec.



ORAL QUESTION PERIOD


Hon. David Crombie (Rosedale):: Madam Speaker, in the absence of the Minister of Employment and Immigration, which 1 find somewhat incredible given the unemployment statistics, I will direct my question to the Minister of Finance. He will know that Statistics Canada this morning indicated that we now have 1.6 million people officially unemployed. This is a staggering increase of 100,000 people more than last month. Also he is aware that the construction industry is the hardest hit, particularly as it affects urban areas. We now have between 25 per cent and 30 per cent unemployed in the construction industry.
Time and time again the construction industry and the Business Council on National Issues have asked the Minister for relief in order to get the construction industry back on its feet and give jobs to its workers. What does the Minister intend to do to see if he can alleviate the incredible unemployment rate in the construction industry?


Hon. Marc Lalonde (Minister of Finance):: Madam Speaker, the figures announced by Statistics Canada this morning show an encouraging trend-


Some Hon. Members:: Oh, oh!


Marc Lalonde: -in the sense that the adjusted rate of unemployment is down for the first time since late 1981, On the other hand, obviously no one can take satisfaction from that result when we see the total number of unemployed in the country.
As the Hon. Member realizes, every winter in Canada the number of unemployed increases. We are seeing the same phenomenon at the present time. As far as the specific question raised by the Hon. Member is concerned, I have received a brief from the Canadian Construction Association. As a matter of fact I am intending to meet with that Association in the next few days. I have also had discussions with my provincial colleagues, the Ministers of Finance, in December, and we all agreed that the area of construction, particularly housing, was an area that should have special priority, both in terms of
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job creation and in terms of answering serious social problems in the country.
I have also met with the Canadian Federation of Labour which made some specific proposals in this regard, in the last two weeks. Those discussions were very constructive and very helpful. I indicated that I would certainly bear in mind their representations in the preparation of my budget.
In my discussions with my provincial colleagues I also asked them to attach high importance to this issue to see what they could do in the preparation of their budgets; indeed, so that all Governments can address this very serious problem in a coordinated and co-operative way and we can all try to reduce the unemployment levels in the country.


UNEMPLOYMENT AMONG YOUNG PEOPLE-NECESSITY FOR TRAINING OPPORTUNITIES
David Edward Crombie: Madam Speaker, again in the absence of the Minister of Employment and Immigration, I am sure the Minister of Finance is aware that the hardest hit group with respect to unemployment consists of people between the ages of 15 years and 24 years. They have an unemployment level of about 21 per cent, and it is higher in many parts of the country.
The Minister has had a request before him a number of times for an increase in training opportunities, particularly for young people, and most recently from the Business Council on National Issues and other employment agencies and trade councils. In the face of those requests and in the face of the incredible unemployment difficulties the country now faces, I would like to ask the Minister why his Government continues to refuse to increase training spaces. We are down 20,000 training spaces this year from last year. Why does the Government continue to ignore the training difficulties?


Mr. Remi Bujold (Parliamentary Secretary to Minister of Employment and Immigration):: Madam Speaker, first of all, I may point out to the Hon. Member that the Minister of Employment and Immigration is not in the House today because he is in Toronto, discussing job creation programs with his Ontario counterpart, in order to put Ontarians back to work. There are other Ministers in the House who are able to answer questions, if necessary. Regarding the Hon. Member's question with respect to training, the legislation was passed with the consent of all parties in this House, and the Hon. Member was among those who voted in favour of a measure that would meet the needs of Canadians across the country. To increase the number of training spaces, in proportion to the size of the institutions concerned, we must have consultations with the provinces. We must also have as many jobs available as possible when people finish their courses.
I may also point out to the Hon. Member that about three weeks ago, the Minister of Employment and Immigration announced that $40 million were being allocated to institutions

February 4, 1983
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that would be providing special courses to students seeking training with a view to entering the labour market.


REQUEST THAT GOVERNMENT EXPAND RECRUITING FOR ARMED FORCES
David Edward Crombie: Madam Speaker, 1 would like to direct my final supplementary question to the Prime Minister. A specific proposal was made originally by the Hon. Member for Victoria, raised by myself in the House, and also raised by backbench Members of all Parties, concerning the opportunity for the Government to increase the recruitment program for those people who would like to get into the Canadian Armed Forces, both for training and for jobs. There are now about 25,000 applicants who are waiting. The Minister of National Defence has already agreed to the proposal. I would ask the Prime Minister why he and his Government continue to refuse to increase recruitment for the Armed Forces in the face of the fact that it is supported universally in this country.


Marc Lalonde: Madam Speaker, the Government is considering various proposals aimed at further increasing its efforts with respect to direct job creation. The Hon. Member is referring to one of these proposals which would increase the number of Canadians in the armed forces. I think he should realize that there are many other proposals involving Government expenditures. There is, however, a question which the Hon. Member and which all of us on this side of the House will have to answer, regarding the optimum use of the limited funds available, and that question is: Would we rather create, let us say, 10,000 jobs with $100 million or
20,000	with the same amount?
Obviously, considering the nature and the high rate of unemployment in this country, we must try to create the maximum number of jobs with the funds available. That is what we are doing at the present time. We have asked the Departments of National Defence and Employment and Immigration, as well as all other Government departments with some responsibility for job creation, to send us their proposals so that we can see whether additional jobs can be created and what the cost would be. At the present time, assuming that we can set aside funds for this purpose, we are looking at ways of providing the most adequate and most comprehensive response, considering the money available, to the very high demand for jobs in Canada.
The Government is open to all suggestions. We must realize, however, that our funds are necessarily limited, and we can do no more than create the largest possible number of jobs with the funds available.


NEW EMPLOYMENT EXPANSION AND DEVELOPMENT PROGRAM
Hon. Flora MacDonald (Kingston and the Islands):: Madam Speaker, 1 wish to direct my question to the Prime Minister, who surely must be concerned about the unemployment situation in the country. Since the Government brought in its mini-budget last October there are 210,000 more Canadians without jobs than there were at that time, and 100,000 more this month than there were last month. The Government in the last few months has raised the hopes of these people by talking about its great job-creation programs-job-creation programs which just have not materialized. In his statement, the Minister of Finance, said most hirings would occur during November, December, January, and February. Well, that just has not happened. I ask the Prime Minister where is the sense of urgency in his Government about this situation? Where are the 60,000 jobs which were promised under the NEED Program?


Marc Lalonde: Madam Speaker, I may remind the Hon. Member that the funds for this program-which was announced by the Government and which originally involved $500 million-these funds have now, thanks to the co-operation of the provinces, been increased to more than $700 million, and as a result, the number of jobs to be created under this program has now risen from 60,000 to at least 80,000. Implementation of the program started as early as December in some provinces, thanks to active co-operation on their part. At the present time, new projects are being announced each week, and in fact every day, under this program.
I may also remind the Hon. Member of another comment I made in my statement on October 27 regarding the private sector which would be the engine of growth in this country. In fact, there are some very encouraging signs at this time. The latest figures for the housing and retail sectors indicate some recovery. In fact, only this morning I was reading an article which said that 40 per cent of companies that took part in a survey indicated that they intended to increase production, while 38 per cent said they had noted an increase in orders for their products. As a result of lower interest rates in the past months and Government incentives, there are also attempts to create new jobs through the private sector. It takes time for these trends to follow through, but once again, we can assume that recovery has started and that we shall be seeing job creation by the private, as well as by the public sectors.


DELAY IN PROCESSING PROPOSALS
Flora Isabel MacDonald: Madam Speaker, I find it appalling that the Prime Minister will shrug off two million unemployed Canadians, just as he shrugged off
February 4, 1983

two million refugees from Nigeria the other day. He will not address himself to any of these issues.
I will direct my question to the Minister of Finance who thinks so much is being done for the unemployed in this country, despite the Government's abysmal record. When I urged the Minister of unemployment-"unemployment" is right-the Minister of Employment and Immigration to act quickly on the NEED Program last November, he said on November 16, " ... we may be in a position to start processing proposals on the NEED Program before Christmas so that they will be in place by January. I think her comments about three to four months delay are not well taken." I tell the Minister it is February, and there has been a three to four-month delay in the processing of these proposals. In Kingston and the Islands there are-


Madam Speaker:: Order. Order, please. The Hon. Member has to come to a question at some point. I would suggest it be now.


Flora Isabel MacDonald: Thank you, Madam Speaker. Given that only nine people in Kingston and the Islands have been employed under the NEED Program and 6,100 people there are unemployed, is that the measure of the success about which the Minister of Finance is talking?
[ Translation]


Joseph Roger Rémi Bujold: Madam Speaker, I think the Hon. Member's allegations are ... I may point out that what the Minister of Employment and Immigration announced and confirmed before the House has indeed been realized. Madam Speaker, I would like to point out to the Hon. Member that up to now, 304 projects under the NEED Program have become operational and that 3,457 jobs have now been filled. In the area mentioned by the Hon. Member, depending on the projects that have been submitted, the program is being processed with the requisite speed and we shall be hiring people as soon as possible. Between now and April 1, we expect to create some 30,000 jobs, and in my opinion, according to the requests we have received, we shall certainly reach that figure.


REQUEST THAT MINISTER INTRODUCE ACTION PROGRAM
Hon. Edward Broadbent (Oshawa):: Madam Speaker, I will see which back bencher replies to me. I have a question on the same serious object, that we on this side of the House do not sit back and smile about, for the Minister of Finance.
Over the past three months we have seen an increase by the thousands in unemployed men and women, with all the human and economic costs that entails. In the past three months we have not seen the announcement of a single new government program. The Minister recently said he was in favour of some
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stimulus. I ask him to think just for a moment of the human and economic costs.
We have seen the figures which came out today, an increase in the number of unemployed of no fewer than 100,000 Canadians. If we wait until the budget, maybe another two months, and given the present trend, that means another
200,000	will be unemployed. Will the Minister quit smiling and trying to charm his way through the situation? Will he stop having more and more meetings, and finally bring in a program of action, now?


Marc Lalonde: Madam Speaker, first of all I am surprised at the comments of the Hon. Member for Kingston and the Islands and of the Leader of the New Democratic Party. I think they should show a little more respect for the simple principle of parliamentary Government and Cabinet solidarity.


Some Hon. Members:: Oh, oh!


Marc Lalonde: There are such things as Ministers who are responsible for certain files, and the Opposition should at least learn to address their question to the right person, if they cannot do anything else.


Mr. Wilson:: There are Ministers who are irresponsible, too.


Marc Lalonde: I invite them to reflect on this over the weekend, and maybe on Monday they will direct questions to the right person. This applies particularly to the Hon. Member for Kingston and the Islands.
As far as the serious question raised by the Hon. Leader of the New Democratic Party is concerned, I find it rather amazing that he should object to the process of consultation which has been taking place with provincial Governments, the labour movement, the business community in this country, with farmers and the co-operative movement. I am amazed that the Hon. Member now finds he does not want us to consult, after having complained so often that the Government was not consulting enough. I think he should make up his mind and realize that the process we have been going through is part and parcel of recovery in this country, and that we all have to co-operate and work together, Government, labour, management, and farming community, to ensure a recovery. No Government will be able to do it alone. Certainly he should know that, and certainly he knows better. Rather than attacking my smile, he should attack-


Madam Speaker:: Order, please. The Hon. Member for Oshawa.


John Edward Broadbent: Madam Speaker, I wish the Minister would get serious. No one on this side of the House objects to the consultations. We appreciate the consultations, whether with labour, business, or with the Provinces. That is important and has to be done. But we also say that the time for consultation surely is past, and now is the time for some action. That is what we are saying.

February 4, 1983
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COST OF UNEMPLOYMENT TO ECONOMY
John Edward Broadbent: Madam Speaker, the human costs of unemployment are the most moving and most degrading to the people affected. I ask the Minister to consider these economic costs of the current level of unemployment. Because of the cost of welfare payments and unemployment insurance, on the one hand, and the loss of tax revenue on the other, we are losing in the Canadian economy, at the federal level alone, the following amounts in these regions of Canada: in Atlantic Canada the cost is $3.1 billion; in Quebec, $9 billion; in Ontario, $11 billion; Prairie Provinces, $4.7 billion; British Columbia, $4.5 billion, for a total of $32.3 billion. That is what it is costing the Government for people who are not working.
Considering the people of Canada want jobs, not hand-outs, will the Minister recognize the seriousness of these figures and take action now, before the budget comes in, to produce more jobs?


Marc Lalonde: Madam Speaker, I have been exposed for long enough to the mathematics of the Hon. Leader of the New Democratic Party to take them with a grain of salt. But one thing we are taking very seriously is the very serious state of high unemployment levels. We have taken initiatives, Madam Speaker. When the Hon. Member says no new initiatives have been taken in the last three months, he is wrong again, like on so many other issues. We have programs that were announced in June and October, which are taking effect every day.


John Edward Broadbent: In October? When?


Marc Lalonde: Yes, sir. They were announced in October and they are taking effect now.


John Edward Broadbent: Oh, yes, and thousands more are unemployed.


Marc Lalonde: Every day there are new projects being announced. As recently as earlier this week my colleague, the Minister of Transport, announced major initiatives-


Some Hon. Members:: Oh, oh!


Marc Lalonde: -which imply $800 million of new investment by railways this year.


Some Hon. Members:: Hear, hear!


Marc Lalonde: That was announced this week.


Mr. McDermid:: You announce that every day.


Marc Lalonde: That money is going to be spent in this country this year and will benefit Canadians in all regions in terms of orders for steel, orders for parts and equipment in the railway sector. These are jobs for Canadians which this Government has created in spite of the rhetoric of the New Democratic Party.


Mr. Hnatyshyn:: You are going to bankrupt the farmer.


REQUEST THAT MINISTER RESIGN PORTFOLIO
John Edward Broadbent: Madam Speaker, if the Minister is telling us, as seems clear, that he has no intention of announcing any new measures to create jobs between now and the budget-that is another month and a half and it means probably another 150,000 unemployed-1 would like to suggest to him that he just give it up, pack it in and give it back to his predecessor who, at least, did not try to charm us to death.


Marc Lalonde: Madam Speaker, I will reflect upon the very positive contribution of the Hon. Member of the New Democratic Party.


Mr. Lawrence:: That is the best offer you have had in a couple of years.


CANADIAN NATIONAL RAILWAYS
Mr. Tom McMillan (Hillsborough):: Madam Speaker, my question is directed to the Minister of Transport. No reasonable person in the country would quarrel with the familiar argument that Canadian National needs to modernize its operations continually to remain competitive and cost effective. However, given the fact that the Atlantic Provinces are reeling from the highest unemployment levels since the Great Depression, why is the Minister allowing Canadian National to accelerate its consolidation of services, with mass lay-offs, at this very time when we can least afford the harsh consequences of such brutal measures?


Hon. Jean-Luc Pepin (Minister of Transport):: Madam Speaker, I have already answered the question a number of times. CN cannot operate as a social agency. Like any other institution in the country, CN must be as efficient as possible in the interest of shippers. Occasionally, like any other organization, they have to rationalize, and occasionally, like any other organization, some people have to be laid off in the process. 1 regret that very much, but I cannot stop the world.
My hon. friend's argument has been mostly that national institutions like CN should pay their respects to provincial divisions in this country. That again cannot be done. You cannot always organize national institutions on a provincial basis. I am sorry if Prince Edward Island feels it should be the centre of a major CN operation, but CN believes that an operation concentrated in Moncton for the whole of the Maritime region will be better in terms of administration and savings.


Thomas Michael McMillan: Madam Speaker, no one is suggesting that Prince Edward Island should be the centre of Canadian National in the country. The fact is that in the last couple of weeks Canadian National has closed or gutted heavy freight or
February 4, 1983

carload centres throughout the Atlantic region, not just in Prince Edward Island.


EFFECT ON ESSENTIAL SERVICES
Thomas Michael McMillan: Madam Speaker, does the Minister realize that Canadian National's obsession-and it is an obsession-with consolidation at this very time is leading not only to the direct abolition of jobs within Canadian National but also to the elimination of essential services that the private sector requires in turn to create jobs? Will he at least come to the Atlantic region and look at the devastation that Canadian National is inflicting upon every single Province there?


Jean-Luc Pepin: Madam Speaker, if my hon. friend can demonstrate to me the essential services that the CN is not fulfilling in this particular instance, I will be glad to look at the matter.
In the last year rail traffic in Canada has gone down by 15 to 20 per cent. The railways had to react to that and adjust to the fact that there has been such a reduction in traffic. If my hon. friend wants to help change the situation, then, with a few of his colleagues, he could support the initiative that we announced on Tuesday. That would see the expenditure of $16 billion in Canada in a period of ten years, would see construction in railways-


Ramon John Hnatyshyn: That is a complete fraud!


Jean-Luc Pepin: -and would see the return to work of a good number of people who, unfortunately, have been laid off recently.


NATIONAL ENERGY PROGRAM
Frederick James (Jim) Hawkes: Madam Speaker, my question is for the Prime Minister. He will know that we still import oil and thus export jobs. Since the introduction of the National Energy Program, drilling activity is down by 32 per cent, and therefore those jobs are down by 32 per cent. There are jobs in the steel industry, making pumps and cars, and jobs in the paper industry and so on, that are dependent on drilling activity. The reason for the 32 per cent drop in jobs is the National Energy Program. It is a stupid Program that needs to be changed. Could the Prime Minister give us a commitment to change that Program at the earliest possible opportunity?


Right Hon. P. E. Trudeau (Prime Minister):: Madam Speaker, the Hon. Member is quoting a lot of his own personal opinions. Recently I had discussions with some people in the petroleum industry and they told me facts that are quite contrary to those that the Hon. Member puts forth. I was told
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that Canadian drillers who had moved to the United States were now without jobs there, and were closing their rigs and moving back to Canada where they feel the economy and energy policy are beneficial to them.


REQUEST THAT PROGRAM BE SCRAPPED
Frederick James (Jim) Hawkes: Madam Speaker, to be precise, in the year prior to the imposition of the National Energy Program, 6,948 wells were drilled in western Canada. In 1982, 4,742 wells were drilled. That 32 per cent drop in drilling activity is a direct consequence of the National Energy Program.


Marc Lalonde: What happened in the United States?


Frederick James (Jim) Hawkes: Madam Speaker, the Prime Minister should know that we need jobs in steel, we need jobs in the automotive industry, and we need jobs in the paper industry. If he would scrap this Program we could have those jobs. Will the Prime Minister scrap the Program?


Pierre Elliott Trudeau: Madam Speaker, if the Hon. Member were as good in his statistics as he is at looking at our neighbouring country, which he seems to think has a better record, he would find, by reading magazines like Fortune, and looking at the specifics, that things are worse there. That is the essence of my answer to him now. They have no energy policy like ours and things are worse-


Frederick James (Jim) Hawkes: Things would be better here if-


Pierre Elliott Trudeau: Is that so?


EMPLOYMENT
Mr. Ian Waddell (Vancouver-Kingsway):: Madam Speaker, my question is for the Minister of Finance who is looking more and more uncomfortable in his job, and is sounding more and more like Ronald Reagan.


Some Hon. Members:: Oh, oh!


Ian Gardiner Waddell: The Minister has told us that the Government is going to create jobs. I was looking at my notes when he told us that. He told us the same thing with the Alaska tarsands project, as you will recall. He told us the same thing with the offshore oil, and he told us the same thing with the pipeline. Will the Minister be honest? Will he level with the Canadian people? Will he admit that the Government's job-creation programs are indeed short term, inadequate, a drop in the bucket, and that even those programs are not happening?


Marc Lalonde: Madam Speaker, first of all I should like to welcome my colleague to his new job as economic critic or finance critic-I am not quite sure which it is. I realize that he had to practise for about three
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February 4, 1983
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weeks to have this question ready to put on the record, but he did it well. 1 hope the next one will not take as long.
To address the Hon. Member's question seriously, I must say that in the opinion of the Government direct job creation by Government is not the total answer or even the global answer to the unemployment program that we are facing in this country. These programs can make an important, temporary contribution to relieving very serious social and human problems. These programs have to be recognized as being of a temporary nature, however, and as being only a very small element of the total solution, which is to create an environment where the total economy is going to recover and where the private sector will be the engine of growth.
This is what the Government has been trying to do by trying to lower interest rates, which have gone down by more than 30 per cent in the last few months. The Government has also been trying to create stimulus in the private sector by such initiatives as the announcement made this week with respect to the Crown, whereby the railways are going to invest $800 million this year. There are other similar measures of this type. They are approaches to try to get the total economy to grow, and particularly to get the private sector to play its full role.
In the meantime, we are doing everything we can, alone and with the provincial and municipal Governments, to create jobs directly which will attempt to alleviate the problem we are facing on a short-term basis.


Madam Speaker:: The Hon. Member for Vancouver-Kings-way (Mr. Waddell), without the theatrics, which are not allowed in the House.


Ian Gardiner Waddell: Madam Speaker, I can tell the Minister that, if he does not make jokes about me, I will give my ironclad guarantee that I will not call him charming any more.


NEED PROGRAM STATISTICS
Ian Gardiner Waddell: Madam Speaker, let me put a supplementary question to the Minister. If he would do his homework he would find out, just by making some phone calls, that under the NEED program, that major job-creation program, in British Columbia 86 jobs have been provided, in Saskatchewan 101, and in Ontario 153. Our arithmetic shows that to be somewhere over 300 jobs. The Minister's office cannot even give the figures for the rest of the country.


Madam Speaker:: Order, please. Please, will Hon. Members come to questions today? We have had innumerable speeches from both sides today. Questions must be more brief. The Question Period is practically over.


Ian Gardiner Waddell: You are right, Madam Speaker, I will get to my question.
Will the Minister consult his Department to find out why NEED funds are not going out and why the Program has not
been taken up adequately, especially with respect to the municipalities of Metropolitan Toronto and Vancouver?


Marc Lalonde: Madam Speaker, the Hon. Member is referring to a number of specific statistics. I can assure him that I am trying to do my homework on a daily basis, and will continue to do so. The fact is that at the present time there are several thousand projects under consideration and several hundred of them have been approved. As a matter of fact, going back a couple of weeks to January 26, 265 projects had been approved across the country, and were proceeding.
I would indicate to the Hon. Member that these projects are going to be approved on a speedy basis as they come in, and that more and more jobs will be created. It is estimated that, with the co-operation of the Provinces, we will be able to create something like 80,000 jobs under the NEED Program. It is our aim to create those jobs at the earliest possible moment, but this will have to be done in a responsible way. I hope that my hon. friend recognizes that.


STUDENT SUMMER EMPLOYMENT PROSPECTS-MINISTER'S STATEMENT
Mr. Walter McLean (Waterloo):: Madam Speaker, my question is also directed to the Minister of Finance. He will be aware that ten weeks from now more than 100,000 graduating students will be seeking full-time employment and that hundreds of thousands of undergraduate students will be seeking summer employment in order to continue their education.
Last summer youth unemployment constituted 50 per cent of total unemployment, according to the Canadian Federation of Students. In light of today's figures of 104,000 additional unemployed in January, and the absent Minister of Employment and Immigration whose comments were quoted in the press this morning, warning that young people who lack training and move from one dead-end job-


Madam Speaker:: Order, please. Would the Hon. Member simply ask a question?


Walter Franklin McLean: Madam Speaker, in light of the Minister's warning about the social unrest and the impact of it, why is the Minister of Finance ignoring the warning of his colleague? Is it proof of a split in the Liberal caucus on this critical situation?


Mr. Savard:: I would not worry about that.


Mr. Baker (Nepean-Carleton):: And don't you worry about us.


Marc Lalonde: Madam Speaker, I do not think the Tory disease has crossed the floor yet. I do not think the Hon. Member should worry about splits in our caucus in that regard.


Some Hon. Members:: Hear, hear!
February 4, 1983


Some Hon. Members:: Oh, oh!


Marc Lalonde: One thing I can assure the Hon. Member on which we are not split is the necessity of looking after the problems of our young people, particularly the large number of students who will be coming into the market this summer. We have already allocated $120 million for the program. I am considering adding even more funds to that program to take care of the applications that are coming in at the present time.


John Horton McDermid: Will you have it ready in time?


Marc Lalonde: Students are making applications, and projects will be approved in the next few weeks.


Flora Isabel MacDonald: This is like the NEED Program.


Marc Lalonde: We will try to make sure that all of the money we can make available is available in plenty of time for those projects. I can assure the Hon. Member that this is a very high priority of the Government, and we are working closely together in that regard.


Flora Isabel MacDonald: Famous last words.


Madam Speaker:: The Hon. Member for Waterloo; a very short question.


CANADIAN STUDENT LOAN PROGRAM
Walter Franklin McLean: Madam Speaker, my supplementary is for the Minister of Finance whose assurances have not yet reached the student community in Canada, nor have the assurances of the Secretary of State who met and spoke with provincial ministers assuring them that funding is coming. Will the Minister of Finance tell the House why he is ignoring the indication of the Secretary of State that funding is needed in the matter of the Canadian Student Loan Program?
[ Translation]


Marc Lalonde: Madam Speaker, this matter is being discussed by the Secretary of State and myself and we are looking into it at the present time. There have been consultations with the provincial ministers. I said earlier that for this summer, the Government has allocated at least $120 million to help students who will be seeking jobs. As far as the next academic year is concerned, we are also looking at the student loan programs, and I hope that as soon as I am able to bring down my budget, 1 shall be able to announce what steps have been taken with respect to this matter.
Oral Questions


CRIMINAL CODE
Mr. David Kilgour (Edmonton-Strathcona):: Madam
Speaker, my question is for the Minister responsible for the status of women. Following the Westendorp decision, the Minister will appreciate that soliciting for the purposes of prostitution is, for all intents and purposes, legal across Canada. Does the Minister responsible for the status of women think that a legislative remedy is required from this House and, if so, what would that be?


Hon. Judy Erola (Minister of State (Mines)):: Madam Speaker, we are approaching a very thorny issue and one that was not resolved by the Committee to which it was referred earlier in the year and about which I am sure the Hon. Member is aware. The Minister of Justice is dealing with it at the moment.


REQUEST FOR PARLIAMENTARY ACTION
David Kilgour: Madam
Speaker, my supplementary question is for the Minister responsible for the status of women. She will appreciate, I think, that as surely as tomorrow's sunrise the state of affairs that exists now will result in more violence to women and girls. Does she, as the Minister responsible for that subject matter, not think that something should be done in this House, in view of the finding of the court?


Judith A. Erola: Madam Speaker, I am as concerned as the Hon. Member. 1 refer again to the work of the Committee which was unable to come to a decision. I hope that this Committee will take its work more seriously and come to a decision.


Some Hon. Members:: Oh, oh!


STATUS OF WOMEN
Mr. Claude-Andre Lachance (Rosemont):: Madam Speaker, I should also like to ask the Minister responsible for the status of women whether she is considering the possibility, in cooperation with the Minister of Justice, of deleting from the Criminal Code the provisions concerning soliciting, in order to remove this from federal jurisdiction and possibly allow local by-laws to regulate the matter, thus getting around the problem mentioned by the Supreme Court in the Westendorp case with respect to the Criminal Code?

February 4, 1983
Oral Questions


Judith A. Erola: Madam Speaker, I refer once more to the work of the Committee. I understand the Minister of Justice is referring the matter to the Committee again. I do hope that we will be able to deal with it once and for all.


RAILWAYS
Mr. Les Benjamin (Regina West):: Madam Speaker, my question is for the Minister of Transport. The Minister is aware that CN and CP own rail lines to Duluth, Minnesota. He is aware that CP has a line to Minneapolis, has negotiated running rights to Kansas City and can haul, either as a result of joint freight rates or running rights once they acquire them, to New Orleans. A few years down the road, when the Minister's so-called Crow rate is in place on grain and other commodities, it will be possible to haul goods more cheaply to New Orleans than to Thunder Bay and Montreal. Will the Minister put up any road blocks to prevent Canadian Pacific or Canadian National from doing that kind of thing?


Jean-Luc Pepin: Madam Speaker, I am not too sure of the meaning of the question.


Some Hon. Members:: Oh, oh!


Jean-Luc Pepin: But the subject of the cost of transportation in different countries of the world, the subject of the degree of subsidization or support transportation gets from the Government in Canada and the Government in the United States comparatively, is one that is impossible to exhaust. I have read discussion papers on these subjects. Some talk about the degree of subsidization which the Americans have by way of the work of the Corps of Engineers or by way of gifts of grain being made abroad as aid. Others say there is more support in Canada. 1 really have not come to a conclusion on that subject, and I dare say that nobody should. These are very difficult comparisons to make.


EXPANSION OF OPERATIONS IN UNITED STATES
Leslie Gordon Benjamin: Madam Speaker, I am talking about the welfare and the good order of ports such as Thunder Bay and Montreal, and the kind of freight charge that will be necessary under the Minister's ridiculous solution, so-called. My question has something to do with the questions asked earlier by the Hon. Member for Hillsborough.
If Canadian National can afford to buy 3,000 miles of railway line in the United States, and Canadian Pacific can negotiate running rights in the United States to move Canadian commodities as well as American commodities, what justification do the railways have for complaining about losing money hauling grain in Canada? In addition, what justification do the railways have for bankrupting communities like
Nakina in Northern Ontario, causing lay-offs, while they can afford to expand operations in the United States but will not build or fix their tracks in Canada?


Jean-Luc Pepin: Madam Speaker, I know that my friend was a reactionary on a number of subjects but I now realize he is also one when it comes to Canadian interests outside the country. It has been considered by everybody I know that the Canadian railways have been able to acquire railways in the United States that have been very advantageous to the Canadian scene, in the sense that they are occasionally in a position to use these railways to bring goods, for example, for export from Montreal. This has been considered an important advantage. The Americans up to now have considered that the fine administration of Canadian railways is making a good contribution to the rationalization of theirs.


CRIMINAL CODE
Hon. Bud Cullen (Sarnia-Lambton):: Madam Speaker, I have a question for the Minister of Justice. He will know that there is strong support for his position for either stronger laws or greater sanctions against those who drink and drive. I know that he has had the support of groups like Mothers Against Drunk Drivers and other organizations of that sort. I also know that he has to consult with provincial Attorneys General. Has that consultation process been completed, and is the Minister receiving support from the Attorneys General in the Provinces in meeting this very serious situation that we have here in Canada?


Hon. Mark MacGuigan (Minister of Justice):: Madam Speaker, 1 thank the Hon. Member for his support on this important issue. I am personally convinced that it is an area in which we must try to respond to the social problem. We have, indeed, begun the process of consultation. It has not yet advanced sufficiently for me to give any indication to the Hon. Member of how it will conclude.


PETITIONS
Madam Speaker:: I have the honour to inform the House that the Clerk of the House has laid upon the Table the three hundred and eighty-fourth report of the Clerk of Petitions stating that he has examined the petition presented by the Hon. Member for Peterborough (Mr. Domm) on Thursday,

a:



February 4, 1983

February 3, 1983, and Finds that it meets the requirements of the Standing Orders as to form.


PRIVILEGE
Mr. Jim Manly (Cowichan-Malahat-The Islands):: Madam Speaker, 1 rise on a question of personal privilege. I wish to correct the impression that I ever accused my father of being a Liberal. Yesterday's Hansard incorrectly attributed to me that I said-


Madam Speaker:: Order, please.



ROUTINE PROCEEDINGS


Rodney Edward Murphy: Madam Speaker, I wish to present a petition on behalf of many residents of northern Manitoba. They state in the petition that they recognize and support the role of the Civil Air Search and Rescue Association and request the Government to recognize the need as well for adequate funds for search and rescue in all parts of Canada.


BUSINESS OF THE HOUSE
Miss Begin:: Madam Speaker, I wish to inform the House that there have been consultations among the representatives of the Parties and that it has not been possible to reach an agreement pursuant to Standing Order 80 or 81 with regard to the allocation of time to the report stage and third reading stage of Bill C-132, an Act to amend the Family Allowances Act, 1973. I am sorry to have to do so, but I wish to give notice that at the next sitting of the House, I shall propose a motion pursuant to Standing Order 82 to allocate one sitting day to each of the said stages of the said Bill.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Order Paper Questions
Mr. David Smith (Parliamentary Secretary to President of the Privy Council):: Madam Speaker, the following questions will be answered today: Nos. 3,339, 4,496 and 4,531.


Miss Carney: 1.	Did the Woman to Woman Organizing Committee request funding from the Women's Program of the Department of the Secretary of State in order to hold a lesbian conference in May, 19S1 in Vancouver and (a) did the Committee have to wait until three months after the Conference was held before receiving a response to the application and, if so, for what reason (b) did the application meet all the criteria for funding from the Program and was the application rejected and. if so, for what reason?
2.	Does the Secretary of State follow a policy of discriminating against all applications for funding from homosexual groups?


Hon. Serge Joyal (Secretary of State):: 1. Yes. The Woman to Woman Organizing Committee requested a grant of $10,700 on February 23, 1981 in order to hold a national conference of lesbians in Vancouver on May 16, 17 and 18, 1981. (a) Woman to Woman's completed application was received on April 8, 1981. The Department sent out its reply on August 20, 1981. (b) It was necessary to reject the application because it did not meet the Secretary of State Department's priorities.
2. No.


Mr. Siddon: 1.	What amount did the Department of Fitness and Amateur Sport contribute to the (a) production (b) distribution (c) promotion of the publication entitled "Canadian Team at the Commonwealth Games 1982"?
2.	How many copies were distributed by the Department?


Hon. Gerald Regan (Minister of State (International Trade)):: 1. The team handbook, "Canadian Team at the Commonwealth Games 1982", was produced by the Commonwealth Games Association of Canada. Fitness and Amateur Sport provided a $375,000 contribution to this Association towards the costs of organizing and sending the Canadian team to the Commonwealth Games. However, the Association also received funding from outside sources to offset these team costs. Two thousand copies of the team handbook were produced by the Association at a total cost of $10,600.
2. None, see Part 1 above.


Mr. Reid (St. Catharines): 1.	Were funds made available to fitness and amateur sport through Loto Canada revenues and, if so, by year, in what amount?
2.	Was the money allocated to specific fitness and amateur sport projects, activities or programs and, if so, which ones and in what amounts?


Gerald Augustine Regan: 1. In accordance with vote L27(a) Appropriation Act

February 4, 1983
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No. 4, 1976, Fitness and Amateur Sport was the recipient of 5 per cent of the net proceeds of Loto Canada as follows:
	($000)
1977-78	$ 3,921
1978-79	4,129
1979-80	2,141
	$10,191
2. The proceeds from Loto Canada were allocated as follows:
Canada Games	($000) $ 2,893
Regional Games	155
Athlete Assistance	1,000
Sport Promotion	600
Fitness Programs	637
University Facilities & Travel	911
Hosting World Events	334
Sport Governing Bodies	3,564
Facilities for Disabled	97
	$10,191


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


Madam Speaker:: The questions enumerated by the Parliamentary Secretary have been answered. Shall the remaining questions be allowed to stand?
Some Flon. Members: Agreed.



GOVERNMENT ORDERS


Mr. Gordon Gilchrist (Scarborough East) moved:: That this House recognizes that an increased commitment to science and technology is fundamental to the establishment of a new industrial base in Canada, to the rejuvenation of existing industries, to the creation of new employment and the maintenance of existing jobs, and to economic recovery, and that this House condemns the Government for its neglect in failing to aggressively develop policies to promote the advancement of science and technology in this country, for its lack of interest in utilizing and increasing Canada's human potential, and for its failure to adopt the spending targets for science and technology that were established by the Progressive Conservative Government in 1979.
Fie said: Madam Speaker, we chose to make use of this Opposition day to bring attention to the urgent and critically important subject of science and technology. Our motion clearly states our concern over the virtual neglect of this key to economic recovery and survival.
I would like to begin by alluding to remarks made recently by the Minister of State for Economic Development and Minister of State for Science and Technology (Mr. Johnston) in various speeches outside the House. I wish he would have been here to hear these remarks.


Mr. Blais:: He will be here later.


James Gordon Gilchrist: Good. I bring these remarks to the attention of the House partly for the record, partly to offer endorsement of them in principle, certainly to offer encouragement, and partly to take issue with the non-application of them to date by this Government. I would like to make it clear to the new Minister that we welcome him and his expressed views, but we also remind him that only the Minister is new; the problem is not. It is long past the rhetoric stage. In fact, it is even long past the action stage. The subject of this debate is vitally important to Canada and much too important to be a partisan issue.
I am pleased that science and technology is now the responsibility of the Minister responsible for economic development because that is where it should be. As our motion today states, science and technology is fundamental to economic development and an integral part of economic recovery. It has been disregarded for a decade and a half while the world passed Canada by. It must not be disregarded any longer.
The Minister has recognized this fact in his speeches. Everyone who talks about science and technology recognizes it. Why, then, is the Government of Canada not adequately carrying out the vitally needed policies and programs that everyone knows are needed?
Let me quote some of the Minister's recent public remarks about this subject. The first quote is:
Our industrial structure will still have a very strong resource bias because that is our area of strongest comparative advantage.
We agree. But why, then, do the two principal levels of Government tax mining on a wind fall basis so that profits are taxed at a level as high as 60 per cent? Why does the Government plan to introduce a northern development tax which will add to the costs of the mining companies in offsetting the former so-called perks of their employees? This will serve only to drive up the cost of Canada's resources in world markets. Why does the Government's regulatory pricing of petroleum resources serve to reduce, not expand, the exploration and development processes which depend on petroleum fuels and petroleum feedstocks? The petroleum industry in eastern Canada alone, an industry which employees over 100,000 people both indirectly and directly and generates product worth $4 billion annually, has been crippled. It faces imminent collapse within months as a result of destructive tax policies on resources, particularly for feedstocks.
I would like to hear the Minister give a detailed explanation of how he will change the Government's tax policy to revitalize the threatened industry and to protect these 100,000 jobs. Will the Minister back up his own statement and show Canadians that he will do more than his predecessor, more than just



February 4, 1983

mouth technological platitudes, and in fact get our resource sector moving productively, technologically, innovatively and profitably. As a tax lawyer, and even as an author on the subject of taxation, will he undertake to make these badly needed changes at once?
Here is another quotation from the Minister:
It is in the new technology-intensive goods and services that the new jobs will be created. But more crucial, it is in these technology-intensive sectors, and I believe in these sectors alone-
That is a remarkable statement:
-that new challenging and high paying jobs can be created.
Let us contrast that statement of hope and intention with the reality of the fact that in 1980 Canada suffered a trade deficit of $1 billion in computers and related products and, according to the Science Council of Canada, that deficit will rise to $5 billion by 1985. Although the Minister can point to some clearly successful examples of high-tech development, it should be apparent that only a dramatic drive to encourage major advances in these technology-intensive sectors by means of tax incentives and grants will any significant degree of success be reached.
But what has the Government actually done? The Mac-Eachen budget cut the capital cost allowance on the first year after acquisition of the necessary new machinery and equipment of all kinds which is needed to speed up both the research operation and the more efficient production of manufactured goods.
Again, can the Minister explain the difference between the wonderful words he has given to the public and the woeful and destructive actions taken by his colleague, the Minister of Finance (Mr. Lalonde)? Even worse, we find that the Department of Finance is now dictating research and development policies. That calls into question the very definition of R and D, the activities in private companies which, up until now, have normally qualified as research. It is even imposing moratoriums on new rulings on the special research investment contracts, the SRICs.
How does the Minister plan to eliminate this stifling bureaucratic impediment to the new technology development which he so rightly describes as being crucial to new job creation in Canada? Even the vice-president of that highly respected corporation, Mitel, complains that "doors have closed" on the SRIC contracts. He says that "favourable rulings stopped in May of 1982, but we are working with the Government to try to open the doors again".
Other people describe the situation in terms of Revenue Canada tightening the screws. Is Revenue Canada to set the control, to control research policy, and pass judgment on the legitimacy of research being carried out, just as it does with regard to Canadian taxpayers who are considered to be guilty until proven innoncent? Or will the Minister point out to Revenue Canada that there is vastly more to be gained through research and the new products and processes it creates
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than the paltry sums to be saved by tightening the screws on research tax options? Why, research pays off at the rate of about 100 per cent a year to Government and, in addition, creates jobs at the rate of 800,000 for every 1 per cent of Gross National Product invested.
Another example of stifling of research in Canada is found in the pharmaceutical industry. Unless the amendments to the Patent Act are repealed, more and more research jobs will be lost to Canada because companies are not afforded the normal patent protection, and all this because of a bureaucratic fiat, a control of research in the country's economy.
Would the Minister undertake to convince the Government that it has been too involved in force-feeding its own bureaucratic growth and control to the detriment of productivity and research? Let me remind the Minister of another of his recent statements. He said:
The difference lies in skills, and that is why education and training and the encouragement of creativity, innovation and enterprise are so important to our future success. Our awareness of the challenges and opportunities that lie ahead must begin in the school system.
How can any reasonable person accept such a clear statement of priority by the Minister in light of the crippling cutback in post-secondary funding which will guarantee even fewer scientists, researchers and technicians in the future than even the deficient numbers being turned out today?
The last quotation of the Minister is a remarkable one. He stated:
I can best describe the urgency and importance of all this by forecasting for you how Canada would fare if we could not manage technological change effectively. Our industrial base, especially manufacturing, would be severely eroded. Unemployment would continue to be high, in the double digits. Our net revenues from resource industry would be severely reduced as our costs rose. The vast majority of the labour force would be forced toward low-paying service jobs.
Has the Minister been away on a long trip, or am I in some kind of a time warp? What is all of this would-be nonsense? These are exactly the problems we are facing today because we have not managed technological change effectively. The Government has totally ignored its obligations to the Canadian people by failing to keep Canadian investment and research at a level equal to the standard of the top technological nations of the world. Back in 1968, Canada expended 1.4 per cent of its Gross National Product on research. The Liberal Government let that figure erode to less than 1 per cent by 1980. When the world was going up, Canada was going down. Last year we invested 1.2 per cent of our GNP on research, on the road back to 1.5 percent by 1985, which is the Government's new, or I should say old, renewed goal. Even if we get there, it will be far too little; but then we would rather let Revenue Canada run our science and technology policies than our scientists and businessmen.
The Minister warns us that in the technology-intensive sectors alone will new challenging and high paying jobs be created. We hope, then, that the Minister will consider the following fact when he thinks of the $5 billion deficit Canada will be facing with regard to computer-related products. France alone will be investing $27 billion over the next five

February 4, 1983
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years in computers and consumer electronic products. This is more money than Canada will spend on all its research, even if it meets its objective of 1.5 per cent of GNP.
I wish the Minister of State for Science and Technology well. I envy him, too. He has inherited a very difficult, but not impossible, task. He will have to educate and convince the dinosaurs in the Liberal Cabinet that Canada is in the age of the information revolution, that eight working Canadians will be producing information in one form or another for every one Canadian who is producing industrial products, and that the information explosion will be a deadly explosion for Canada if we do not gear ourselves up to managing and developing our technology quickly.
I envy the Minister because he has the power to make the changes necessary to bring Canada into the information age, to get the message through to Canadians that the industrial revolution is over, that work, living and education standards are changing and that we must change with them, and that the Government will lead that change, not follow further and further behind. The micro-technologies and bio-technologies are reshaping and will continue to reshape all our standards and values. Our Government has an obligation to lead Canada into the future, not to anchor it into the past.
I believe that the Minister of State for Economic Development is both a competent Minister and a man of his word. He has said that he will soon be bringing forward policies which will launch the initiatives which he believes we need for economic recovery and investment. We applaud that, and we challenge the Minister to make good on these crucial promises.
The Progressive Conservative Party believes that a policy for research and technological and industrial development must embody the specific components of which I will speak. It serves no useful purpose to simply criticize, and so we will offer the Minister a base plan. A national objective, supported by tax and investment policy, should be set to match and eventually surpass those declared goals of competitive, advanced nations and should be constantly monitored for return on investment in both jobs and dollars. Other nations are expending as much as 2 per cent to 3 per cent of their Gross National Product. We should certainly be attempting to match or better that.
An industrial policy must concentrate on the strength of Canada, both human and fiscal. Canada's research and industrial development should be mainly directed to resource-based activities, as the Minister says, and to those opportunities presented by the exigencies of Canada's geography, climate, size or any other particular requirements.
Policy should aim at the broadest application of human skills and the providing of the maximum in personal accomplishment, social opportunity and national wealth generation for the benefit of all Canadians. Policy should emphasize the greater role and responsibilities of the private sector to conduct the larger portion of research for reasons of objectivity, efficiency and directness of result.
Policy should clearly identify and deliberately support advance in technologies and industries; for example, electronics, micro-electronics, bio-technology and other types of high technology which are developed. Policies should create a
favourable environment for research spending and venture capital by means of sensible regulatory and tax systems embodying the proper balance of tax incentives, both positive and negative, grants, Government purchasing practices, export incentives and product mandating encouragement.
Policies should be developed in co-operation with provincial Governments and consider regional needs and strengths. Policies should support a strong basic research role through national and academic institutions. We have done well in these fields in the past but we must do more. Policies should encourage and co-ordinate appropriate educational programs to meet foreseeable scientific, technological, industrial and social requirements.
I found it strange that the secretary of MOSST would go around a year ago with beautiful multi-coloured slides proving conclusively that Canada was producing half as many scientists as it needed, but I did not realize then that the Minister of Finance would take care of the problem and cut the need instead of developing a better streaming of future scientists into the system.
Policies should develop a favourable public appreciation and attitude toward technological and industrial accomplishment and advancement. I look forward to the day when Canadians will see themselves as technologists, scientists and contributors to a world which desperately needs our resources and our brain power.
Policies of Government procurement should be closely tied to, and supportive of, industrial goals. I challenge the Minister to incorporate and achieve these goals. The achievement of them will guarantee Canada's pre-eminence as a strong, healthy, prosperous nation, which is the birthright of all Canadians.


Some Hon. Members:: Hear, hear!


Stanley Hudecki: Mr. Speaker, I wonder whether the Hon. Member for Scarborough East (Mr. Gilchrist) would respond to a generally expressed concern that with the development of technology there will be a lesser and lesser need for people who are unskilled and unemployed. In speaking to various high school groups and encouraging them to take specialties in the area of high technology, physics and the basic sciences, even at the high school level young people are concerned that the development of robots and mechanical aids will have an ill effect upon the employment picture and their chances of an occupation. In his studies and readings, has the Hon. Member in his own mind dealt with the particular social problem which the evolution of high technology will produce in the country?


James Gordon Gilchrist: Mr. Speaker, I thank the Hon. Member for Hamilton West (Mr. Hudecki) for his very penetrating question. It is a very serious one about which I think we can do something. Young people in schools today are very much more


|
February 4, 1983

aware that we have left the industrial age and entered the information generation age. I mentioned in my speech that eight Canadians will be working in information generation for every one person producing goods in the future. This is likely to continue to a much greater degree, thus providing more jobs in the information sector.
Of course, the information sector includes everything from people who are in advertising, accounting, conceptual design, the making of blueprints or doing anything which comes up to but falls short of the actual production of goods. The development of skills for which we are calling is one that will embrace a much greater involvement of more and more people to do the kinds of jobs which will be needed in the future.
1 am not concerned with the argument that if we put robots in an automotive plant it will cost jobs. That is obvious, but it would only cost assembly jobs. We would replace them with other jobs, such as looking after the robots and looking after designs handled through the CAD-CAM processes. We would simply change the nature of the jobs. The question should not be: Will we lose half the jobs in an automotive plant? It should be: Will we save half the jobs in an automotive plant? Not to do this, not to be right at the top in world-class standards in any kind of operation, is to lose all the jobs. We will end up having no people producing no cars because the cars will be much too costly and much too inefficient.
I think the standards have to be recognized because they are there, not because we want to set them up. They are there, and we must be the best in the world so that we may be the most competitive and the world will buy more and more Canadian products, which will provide more and more Canadian jobs.


Mr. Evans:: Mr. Speaker, I am very impressed with the work the Hon. Member has done in the area of science and technology and with the thinking he has put into his role as critic. He has presented us with a very general framework for policies in the area of science and technology, which I think sets some very broad objectives that are laudible and should be acceptable.
In the area of education, which is of critical concern because we are not training the number of people we need in the sciences or in the research fields, could the Hon. Member put some specifics or some flesh around his objectives as to how we should go about dealing with the problems faced by universities, with the structural difficulties in the universities and with their problems in the reallocation of resources and so on? Could he put some flesh around his objectives in an educational policy as to how the federal Government might take action to improve the situation?


James Gordon Gilchrist: Mr. Speaker, I thank my Member for that question. I will not take refuge in the argument that we are not the Government and we should not, therefore, put specifics or flesh on the bones. It is a perfectly fair inter-Party question.
The fact is that we have taken too much of a "hands-off' position with regard to post-secondary education. I sympathize with the Member and the Government for apparently having such little control in the provincial application of educational
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funds with regard to these institutions. Simply I would encourage him and the Government to be more direct and much more involved in the specific streaming of more federal money directly to perceived objectives in post-secondary institutions. I do not think we can take refuge in the fact that they are not ours and therefore we cannot do anything.


Ian Gardiner Waddell: Mr. Speaker, I have a two-part question. Should I put the first part of it, obtain a short answer, and then put the second part?


The Acting Speaker (Mr. Corbin):: I suggest to the Hon. Member that he put one question at a time.


Ian Gardiner Waddell: Well, here is my question. As I understand what the Hon. Member for Scarborough East (Mr. Gilchrist) said, he believes it is basically the private sector which should do research and development. I would like him to confirm that it is basically a private sector thrust. If that is true, how does he square it with some of the questions Members of his Party asked today? I am referring to the Hon. Member for Rosedale (Mr. Crombie) and the Hon. Member for Kingston and the Islands (Miss MacDonald), who want Government involvement, it seems to me.
Also it seems to me that the Hon. Member was saying that in research and development it is basically a private sector thrust. If the private sector in Canada does the research and development, why should American companies-and basically we have American companies in Canada, or a branch plant economy-do the research and development in Canada? Why should they not act like they have always acted and conduct the research and development in the United States, not in Canada; in other words, doing it with the parent companies, to our loss here in Canada?


James Gordon Gilchrist: Mr. Speaker, I did not say that the private sector should do all the research and development to the exclusion of Government. I said they should all have a share. It is quite obvious in the very expensive areas of farm or agricultural research that even the biggest farm in Canada could not afford the kind of research cost which is attendant to that. There is a clear need for Government participation in those kinds of fields.
Where you are getting into the area of general and broad-based research, it is impossible to direct that from a very few institutions. It should be conducted in a way that allows Canadians in every walk of life, in every institution, in every skill to come forward with the kind of research and innovation of which we are capable. This happens every day in every company that has a research department. It is far more efficiently done, far better directed and far more profitable to all of the country. We are talking about the benefit of all the country.
I happen to have been involved in a company which was once American, as the Hon. Member said, and is now Canadian. There was a changeover from the research which came

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with an American stamp on the envelope, and for which we paid royalties as high as 3 per cent, to when the company became Canadian, set up its own research organization, did its research and started to generate 3 per cent royalties from large American corporations. They came to us cap-in-hand asking us to sell our products. The transition was tremendous. It became a profit centre in the company, and did very well. This is the kind of encouragement which I believe every company should go through.


Mr. Huntington:: Mr. Speaker, I would ask the Hon. Member for Scarborough East (Mr. Gilchrist) to elaborate and expand on his fear that, if the amendments to the Patent Act are not withdrawn, he sees a loss of protection and jobs in Canada.


James Gordon Gilchrist: Mr. Speaker, that is a most poignant and timely question.


Some Hon. Members:: Oh, oh!


James Gordon Gilchrist: Hon. Members can laugh if they like, but it just so happens that it is. We are meeting these days with the members of the pharmaceutical industry to talk about that very problem. Hon. Members are aware that one research organization has shut down, and I will name it, Ayers. Another nearby is greatly reduced in its research capability.
We have had representations from virtually every major pharmaceutical company that this specious argument about generic products being much lower in price than proprietary products in Canada is really nonsense. There is a very narrow gap in the prices. However, the cost of the Provinces which are insisting on this generic availability is very high because these companies are not producing the new products which would reduce the amount of time people spend in hospitals. Therefore, the cost to the Provinces in even higher than their alleged savings.
Unless we get rid of these amendments which are reducing the normal patent coverage enjoyed by other kinds of companies in Canada, these companies will take their research to the United States, as the previous Hon. Member asked about, and it will be lost to Canada. The cost will be very dramatic.


The Acting Speaker (Mr. Corbin):: Order. I must inform the House that the Question Period is now over.


Ian Gardiner Waddell: Mr. Speaker, I rise on a point of order. Perhaps I did not note it in the debate, but I wonder if you could clarify the ruling on whether a Member from the same Party can ask questions.


The Acting Speaker (Mr. Corbin):: Primarily questions should be put by Members of Parties other than the Party of the Hon. Member who has just spoken, but Members of the same party are not excluded from putting questions.


Mr. Simon de Jong (Regina East):: Mr. Speaker, I too join with the Hon. Member for Scarborough East (Mr. Gilchrist) in condemning the record of research and development of the Liberal Government, especially in the last decade, which I
would call the lost decade. That decade saw our expenditures on research and development drop to less than 1 per cent of GNP. It was a shameful decade that saw a major downgrading of our major universities and our research capacity.
The record of the 1970s is the strongest example of the type of neglect and mismanagement that the Trudeau Government has inflicted upon Canadian society. It is a national embarrassment and disgrace. It is a disgrace that we ended up having as much of our Gross National Product being expended on research and development as countries like Ireland, Portugal and Spain. It put us into that class of country. I agree with the Conservative Member that Canada should be, and has the capacity, the ability and the need to be, a first-class country in terms of research and development.
There is much that needs to be done in this country. Our position in many ways is unique, geographically, politically, socially and economically. There is a tremendous need and opportunity for having an innovative society with a strong research and development sector.
It is not a case that we are a small country and that we do not have the population base. I point, for example, to the Nordic countries, Norway, Denmark, Sweden and Finland, which are very much like us in climate, population size and resources, yet their private industry spends almost twice as much on research and development. Their industrial labour force is about 25 per cent larger than ours. Those countries have had coherent plans to ensure adequate research and development being done in their countries. It is not an excuse that can wash when we say that Canada just does not have the population base or market base to allow a healthy research and development sector.
The sad record of the seventies continues, the record of mismanagement. Our universities are in a state of financial uncertainty. They do not know what grand scheme the boys across the way are plotting now. They do not have any assurance that financing of universities will continue on a predictable basis in the years ahead. For the last number of years they have been existing in this area of uncertainty. Is it deliberate Government policy to create this uncertainty or is it just a mindlessness we have seen so often being exhibited by this Government?
As well, there exists a lack of coherent policy in terms of taxes and grants to encourage the private sector to expend money on research and development. There has been no clear, precise statement, strategy or goals presented by the Government that would allow the private sector to have some feeling as to where the Government wants the country to go. There is no formulation of coherent policies and goals. We continue to flounder in uncertainty and insecurity.
We have a new Minister of State for Science and Technology (Mr. Johnston). Like the Conservative speaker, I too welcome him to this most important job. Perhaps in the long run it is the most important of all the Ministries.
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Like the Conservative Member, 1 too am disappointed in the record so far. We do not see a coherent program emerging that can begin to shed some light and provide some leadership to Canadians, whether in the private sector or in universities, people who are engaged in research and development. There is no coherent policy and no coherent goals coming from the Government.
While in many ways I agree with the Conservative motion, it does miss a few essential points. The essential reason why we have a small amount of research and development in Canada today is that our private sector has not invested the sums of money in research and development as they have in other countries, such as the Nordic countries, Germany, Holland, the United States and Japan.
We must ask the question why. The answers are there, Mr. Speaker. Studies after studies have demonstrated that most of the industries in Canada are branch plant industries. It is not so much the fact they are foreign owned which prohibits the development of R and D in Canada; it is the economic structure which they create in Canada which works against development of R and D. The simple fact is that we as branch plants do not have the opportunity of doing research and development in Canada. It generally gets done in the home country. That is where the scientists and the labs are. That is where research and development work gets done.
Sometimes research can be done in one country, say Germany, and developed somewhere else, say Taiwan, and there is not even a relationship between the research part and the development part. That is the major reason we have low R and D in Canada. In fact the former Minister of State for Science and Technology suggested in a speech to the Canadian Manufacturers' Association a year or so ago that it would require an increase of some $2.4 billion invested in R and D, and most of that will have to come from the private sector if we are to achieve our goal of 1.5 per cent of our Gross National Product going to research and development.
The question then arises, how can we make the private sector, particularly the foreign-owned private sector, make its contributions towards research and development in Canada? I hasten to add it is the foreign sector, not the Canadian privately-owned industries, which are laggards in terms of their expenditures in R and D. In fact, their record is pretty good. It is the foreign-owned companies which make us into a branch plant economy and prevents us from developing our own research and development community here in Canada.
It seems obvious to me that if the Government is to develop a coherent strategy to achieve the 1.5 per cent of our Gross National Product going to R and D, it must first and foremost address itself to the question of how we can get the multinationals to spend a decent amount of their profits in Canada for R and D. We have heard of no solution to that central problem from either our Conservative or Liberal friends. And until we come to a solution to that problem we will always remain a
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second-class country in terms of our scientific research and development.
Again, Mr. Speaker, I hasten to add that it is not the fault of the Canadian people. I believe as a people we are generally well educated. We have some excellent universities. In fact, our past record of major discoveries in the world goes far beyond that expected from our population. For example, oil was first discovered in Petrolia, Ontario, but the oil industry was developed somewhere else. The extraction of kerosene from coal was a process discovered here, but again was developed somewhere else. The telephone was invented here in Canada, but again developed somewhere else.
Perhaps historically the biggest R and D blunder of all time came as a result of a decision taken by a Progressive Conservative Government to scrap the Avro Arrow. This decision, Mr. Speaker, cost the jobs of hundreds and thousands of skilled scientists and engineers, wiping out a technology which the United States gobbled up. We used to refer to Los Angeles as the fourth largest Canadian city because of the large number of engineers and scientists who left Canada to work in the American space program. In fact, our greatest contribution to the American space program was not the "arm" but the scientists and engineers we supplied to the U.S.
But there is a deeper question which we have to address ourselves to as Members of Parliament, and that is a question which does not very often get asked; that is, research and development for whom? To benefit whom? Research and development for what purpose? I would maintain, Mr. Speaker, that just blindly throwing money into research and development is not good enough. I can see that the two old Parties are on the verge of panic as they scramble for a solution to the economic mess which this present system has created. They would have us believe that technology offers the golden way out; but technology at all costs is not necessarily the solution. For example, there are some fundamental problems which will affect Canadians with the unmindful introduction of the new technology. In micro-technology there is the whole question of VDTs and health problems. Unless Government plays a responsible role in the development of this new technology, we will eventually have to pay in terms of increased health costs, and all the health problems this could create for untold thousands of people, particularly women, across the country.
Then there is the question of unemployment with respect to robotics in industry. For example, the GM plant in Lordstown, Ohio brought in robots and displaced some 10,000 workers. Yet did the price of cars go down? No, it did not.
A central question which also has to be asked is, how does throwing people out of work give them the money and opportunity they need as consumers to buy the goods produced? For example, over one-half of the telephone operators, mainly women, lost their jobs at B.C. Tel when it automated its switchboard system. Women are particularly hard hit by the developments in the micro-technological field, because women have always been last hired and first fired. Technology at the expense of people will make such inequalities even worse.

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Some say the new technology, the robots, the micro-technology and so on, will create as many jobs as will be displaced. There is no study, Mr. Speaker, of which I am aware, which proves beyond doubt that that indeed will be the case. In fact, I believe it is safe to assume that hundreds of thousands of people can no longer become productive workers, that they will, in essence, become obsolete. What to do with that large section of our population which is going to be displaced is something to which Parliament and Government should address itself.
We come back to the question: Technology for whom? Research and development in whose interests? Our Party, Mr. Speaker, is opposed to just throwing money at the private sector, trying to seduce them with greater and greater grants, hoping that in the end they will do their R and D here. There are many countries in the world trying to do the same. Are we going to try to outbid each other in terms of incentives? If the public, as the public should, makes investment in R and D, we have to make certain that that R and D helps and benefits the Canadian people; but the past record shows that very often this is not the case. I point out, as an example, the mounds of money in tax incentives and direct grants which we have given the oil industry for research and development in the extraction of gasoline and oil from heavy oil, the drilling in the North, new technologies which did not exist before. These new technologies were paid for out of public funds, yet we do not own those technologies. The patents are owned by the few multinational oil companies, and they will use the control of those patents, Mr. Speaker, to blackmail Government and Canadian society into doing their will. For us to spend the money to develop new technologies and discoveries which are then owned by the multi-nationals who ship them out of the country is unacceptable to us.
In closing, Mr. Speaker, I would like to speak on another side of this issue, commonly called "appropriate technologies". These are technologies which do not increase the concentration of wealth and power into fewer and fewer hands, or technologies which allow for greater central control over more and more people's lives.
However, there is the possibility of developing technologies which allow greater independence and greater self-sufficiency. A prime example of that is energy. If we spend the money needed to build a nuclear plant instead on home insulation and conservation, the energy saved will exceed the energy produced by that nuclear plant. At the same time, developing nuclear technology will mean greater central control over people's lives. Developing conservation technologies, Mr. Speaker, allows greater freedom for people because there is less dependence on utility companies and banking and high finance interests. It gives people a greater degree of freedom. To develop appropriate technologies, Government has to play a central role.
Since being elected to this House I have been concerned about the whole question of herbicides and pesticides. I see
tremendous problems in terms of spoiling our water and land. Yet it is the technology of herbicides and pesticides which is now very often forcing farmers into bankruptcy because of their high cost. They are dependent on that technology to control weeds and inspects, even though it has been shown a lot of insects are now developing resistance to these chemicals. And these technologies were developed because of the profit motive. However, a new technology of biological control and different and better farming methods can be developed. That does not mean anyone is going to make a profit on it other than the farmer, but it does mean greater independence for the farmer.
As we move into the twenty-first century, Mr. Speaker, major technological and social changes will occur. We need a Government with a notion as to where we want to go as a society, to develop not only an economic strategy but also a social strategy. We cannot have a research and development strategy without an economic and social strategy; they are all one. We must begin to define the goals of our society. That means input from universities and the scientific community, labour and business, fishermen and farmers, and retired people. We need a coherent policy, a coherent plan. We do not have that now. Therefore, we are in support of the motion introduced by the Conservative Party today.


Mr. MacBain:: Mr. Speaker, as you know, I spent some considerable time on the special task force on energy, and if there was anything we learned it was about where we are going to be looking for the main source of energy in the long term. The answer we received from the best laboratories and universities in the world dealing with this subject is that the only hope for mankind to have an abundant source of energy in the future was fusion. I would like to have the position of the Hon. Member for Regina East (Mr. de Jong) as to whether or not he would accept that.


Simon Leendert de Jong: Mr. Speaker, I am naturally hesitant about any industry or technology which requires such tremendous capital investment. Given the reality of energy today as opposed to a year ago or even six months ago, we are finding that energy projects require heavy capital investment. Indeed, they are the dinosaurs of the industry. I understood that the committee as well recommended that the path to the future was through hydrogen, the most abundant element in the world today. It is my hope and expectation that R and D will go into solar power, and from there into hydrogen.
The Chairman of the National Research Council suggested to me in committee a year or so ago that he felt that within five to ten years electricity from the sun will be as cost-competitive as that from all other sources. If that is so, if we can get electricity from the sun and at the same time develop hydrogen power to run our cars, trucks and tractors, then 1 suggest we have something which is environmentally sound and does not require massive capital investment. It will allow every country, almost every community, particularly in the Third World, to attain energy self-sufficiency without going into debt up to their necks. They would have a bountiful
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supply of energy to light their lamps and run their tractors. I suggest, Mr. Speaker, that for me that is the path we should be following.


Mr. Gurbin:: Mr. Speaker, I have three short questions in response to that answer. When you speak about the sun, in fact what you are talking about is fusion. If you want to supply electrical needs through the power of the sun, then you are talking about technology which in fact is both capital-intensive and has as many inherent dangers as a local nuclear plant.
My first question is whether the Member would support the ideas put forward by the Hon. Member for Scarborough East (Mr. Gilchrist) in his opening statement dealing with one-product mandating, whether it is a foreign or Canadian company. Then there is adjustment of the tax system to provide incentives for high-risk research and development. That is the short question.


The Acting Speaker (Mr. Corbin):: Order. May I suggest that Hon. Members put one question at a time in view of the hour.


Simon Leendert de Jong: Mr. Speaker, the notion of product mandating I think has a lot going for it. I would include in there that we develop those technologies appropriate for Canada, those which meet our real needs as a country. Energy, transportation and communications are areas which naturally fall into that category. The problem is getting agreement. However, if we do not get agreement from other countries, we should still proceed; we should select our goals. We should decide what we want to do and go and do it. Make the deals with industry if we can, but go ahead and do it. Studies have shown that by the very nature of multinational corporations and our branch plant economy, very often research and development done in Canada has no relationship to our real needs as a country.
[ Translation]


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


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
The Acting Speaker (Mr. Blaker):: When the House rose at one o'clock, the Hon. Member for Bruce-Grey (Mr. Gurbin) had been given the floor for the purpose of asking a question. I understand that there are four minutes remaining in the ten-minute question and answer period. I will accord the floor to the Hon. Member for Bruce-Grey and he can decide what he wants to do about the absence or presence of the Hon. Member for Regina East (Mr. de Jong).
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Gary Michael Gurbin: Mr. Speaker, I regret the absence of the Hon. Member for Regina East as I was looking forward to his response to my questions. Perhaps he will be able to respond in another fashion on a later occasion to the questions his speech raised in my mind.
My first question concerns productivity. The Hon. Member mentioned the auto industry and said that Canadians are not getting cars any cheaper because of the changes in things like robotics and the technology that has been implemented. I wonder if he could enlighten us on the level of productivity that would be necessary in order to decrease the cost of production. Would he agree that the way countries like Japan and others have been able to decrease the unit cost of production is through increased productivity?
The Hon. Member also critized technology control, particularly by the multinational companies. Is he aware that the majority of energy-related development and research is carried on through AOSTRA and the mechanisms they had in place to make sure that the technology would be freely available in that particular sector to Canadian industries and to energy-related activities that could occur in Canada and other countries?
I will leave those questions on the record and look forward to the Hon. Member's response in the future.


Mr. Deans:: Mr. Speaker, I will be delighted to bring the Hon. Member's very interesting questions to the attention of my colleague. He was delayed by answering some other questions outside the House. I expect him to be here momentarily. I know that he not only has answers to both questions but that he will be well able to satisfy the Hon. Member's curiosity.


Mr. Cook:: Mr. Speaker, I thought the Hon. Member for Regina East (Mr. de Jong) made a very good speech. I enjoyed what he had to say and I agree with most of it. In one respect he worried we though, because he sounded slightly like a Luddite. He talked about 10,000 workers losing their jobs through automation and robotization, but he gave no answers to the problem. Does he have an answer?
We went through this when the railways went to dieseliza-tion. That has worked itself out over the years but with considerable disruption in the employment pattern. I do not believe we can stop progress or this movement.
I would appreciate an answer from the Hon. Member or, indeed, from any Member of the NDP at any time, concerning what attitude or policy they would adopt toward these obvious social disruptions that are bound to take place. We all regret them, of course, but I should like to have the answers from the Hon. Member, rather than just questions.


The Acting Speaker (Mr. Blaker):: Then the Chair will recognize an Hon. Member for debate.

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Ian Deans: Mr. Speaker, 1 will undertake, as I did with the previous questioner, to have the Hon. Member correspond directly with the Hon. Member on these very important matters that he has raised. The Hon. Member is absolutely right that it is not only enough to raise questions, but it is important, in addition to raising questions, to have answers. But I might ask him in raising his question whether he himself has any answers.


Mr. Munro (Esquimalt-Saanich):: You cannot do that.


The Acting Speaker (Mr. Blaker):: I think the Hon. Member for Hamilton Mountain is involved in a ten-minute question and answer period. In that regard I have to say that the clock seems to indicate that that period is over. I think that is the best way to proceed. I see the Minister of State for Economic Development (Mr. Johnston) rising, but I am not sure whether he is rising on a point of order or in debate.


Hon. Donald J. Johnston (Minister of State for Economic Development and Minister of State for Science and Technology):: Mr. Speaker, I am rising in debate. I am rising today as Minister of State for Science and Technology more than in my capacity as Minister of State for Economic Development.
I would like to say that it is significant, as has been pointed out by one of the speakers who preceded me, that these two ministries come under the responsibility of the same Minister because of the importance of science and technology to economic development in this country. That necessity has been recognized now in many other countries in the western world, and I suggest that in itself is some indication of the importance which this Government attaches to science and technology.
At the outset I would like to say how much I enjoyed the speeches made by the Hon. Member for Scarborough East (Mr. Gilchrist) and by the Hon. Member for Regina East (Mr. de Jong). While it is true that I take issue with a number of the partisan points which they attempted to score in the course of debate, I suppose that is to be expected.


Ian Deans: Unlike yourself; you never score partisan points.


Donald James Johnston: At the same time I felt there were some very constructive suggestions put forward upon which I will be commenting during the course of my intervention.

I may also add, Mr. Speaker, that I am most impressed with this procedure which enables Hon. Members to exchange views. Unfortunately, the Member for Regina East (Mr. de Jong) did not remain in the House to answer questions that might be forthcoming. This creates some problems for Hon. Members who would like to ask some questions about the speech he just made in the House.

Apart from that weakness in today's proceedings which I doubt will arise very often, I do think this is really a very constructive kind of procedure, particularly in terms of a
subject like science and technology in which all Members of this House are so passionately interested in today's world.
I felt 1 should begin by looking carefully at the motion proposed by the Hon. Member for Scarborough East and providing some analysis of it in terms of the Government's policy in the past, in the present and in the future. The motion reads:
That this House recognizes that an increased commitment to science and technology is fundamental to the establishment of a new industrial base in Canada-
That is the first point made by the motion and I would like to speak to that just for a moment. I am not clear and 1 hope I will have the opportunity to ask, although I do not see the Hon. Member for Scarborough East in the House, what was specifically intended by "a new industrial base", in light of the comments that followed during the course of his intervention.
You may recall, Mr. Speaker, that the Hon. Member spoke of Canada having a very important resource base, a very important strength in that sector, that in all likelihood it would continue to be one of our strengths and that it must be built upon. Obviously, technology has a very significant role to play in enabling Canada to maintain and expand upon its competitive position in that sector.
I am not sure what the Hon. Member means by new industrial base. I suggest that we have a very strong, well established industrial base in Canada and upon that base we must build further. Technology, of course, is the key for us to build further in that sector.
We hear much of Canada being by-passed by other countries and about our lack of commitment and effort. In fact, 1 would be the last to say that we do not require a sound, ongoing technology policy. I would be the last to say that there is not more to be done. But I would also be the last to say that we have not accomplished a great deal and that we do not have a record of achievement of which we must be very proud.
Too often it seems to me that one reads in the press and in reports by economists about Canada's falling rate of productivity. When I say "too often", I am not suggesting that we should not all be conscious of that rather lamentable performance in productivity, particularly during the 1970s.
Canadians, by and large, do not realize that Canada is still one of the most productive countries in the world. In the OECD report on historical statistics for the period 1960 to 1980, the real gross domestic product per employed persons of selected countries is compared with that of the United States which, incidentally, and notwithstanding its lamentable performance in improving productivity, remains the most productive country per worker among the countries cited. The countries are the United States, Canada, France, West Germany, Japan and the U.K.
I am not sure that Members of this House realize that Canada is still ranked second among those countries in terms of real productivity; that is, real gross domestic product per employed person. But what is also true is that we have been

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rapidly slipping in terms of improving our rate of productivity. In that category Canada is a dismal second to last among those countries. In fact, I am sorry to say that between the period 1973 to 1980 Canada is ranked last among those countries with effectively no productivity increase over the period. That is the problem we must address.
It is important for us to realize that we begin from a very sound base achieved over many years of sound policies, of research and development and of innovation in the industries of this country which have brought us the standard of living which all Canadians enjoy. We have many winners in this country; let us not forget that. Many of them have been due to the programs which have contributed to create that industrial base. I would like to cite a number of programs which this Government has introduced over the years. If there are any questions flowing from them, I would be more than pleased to respond.
The programs which are the best known and which have played major, key roles, I suggest, in terms of keeping Canadian industry competitive and also at the leading edge of technology in so many fields, include the Enterprise Development Program and the Defence Industry Productivity program, both of which are programs of the Department of Industry, Trade and Commerce.
A more recent program, Support for Technology Enhanced Productivity Program, is another program of the Department of Industry. Then we have the Unsolicited Proposals Program in the Department of Supply and Services. I see my colleague the Minister for Supply and Services (Mr. Blais) is here today. He is responsible for the administration of that Program to which I have just referred as well as the Source Development Fund, another creative program. This program will have a major impact upon the technology of Canadian firms, also introduced at the instigation of our current Minister of Supply and Services during the current term of this Government. In addition, there are several important programs in the National Research Council of Canada.
I would be remiss in not paying tribute to the work of the National Research Council and the extraordinarily enviable international reputation that it enjoys. It is another institution of which we can be justifiably proud. There we find the Industrial Research Assistance Program as well as Programs for Industry Laboratory Projects.
Each of these programs plays a very significant role in having contributed, and continuing to contribute, to that very important industrial base which Canadians enjoy in this country. I might also mention in passing, because I know that some Members in the House were present, that our colleague the Minister of Supply and Services, who is in the House today, hosted just a few short days ago a celebration of the tenth anniversary of the Science Centre of the Department of Supply and Services. There was a magnificent display of the products and advanced technology that have been produced
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through a number of these programs operating under the umbrella of the federal Government.
I suggest that when we talk about science policies and technology policies, let us never lose sight of the fact that we in Canada are not in the technological backwaters of the world. In fact, we have much technology to export. Of course, we still have great potential ahead of us and it is to realize that potential ahead of us in this world of rapidly changing technology that our efforts must be directed. That is the direction in which we are moving.
I mentioned a moment ago that we must not forget our winners. I thought I would perhaps this afternoon cite some of the lesser known winners in Canada, most of whom have enjoyed the support of these programs. I expect that most Members of the House are familiar with the achievements of companies like Northern Telecom and Mitel in the international arena, and CAE Industries, particularly in the area of aircraft simulators where it has no peer in the international arena.
There are many other companies in this country which are much lesser known. Just a few months ago, when I was speaking in Toronto, I thought I would look up some of these companies to see how many small threshold firms and others have carved out a niche for themselves in the international arena. Canadians are probably not aware of many of these companies. For example, the Industrial Research Assistance Program which I referred to earlier had contributed some $2 million to Abco, which is a Lunenburg, Nova Scotia plastics and equipment manufacturing company. The sales of that company, which is situated in Lunenburg, have risen from $5 million in 1972 to $30 million in 1981. The number of employees has climbed to over 400 from a base of 150 at the beginning of that period. New products that this company has developed through R and D have permitted it to make as much as 80 per cent of its sales on international markets.
I could go through a number of companies that have had similar successes. For example, there is the International Submarine Engineering Company of Port Moody, British Columbia. I have already referred to Mitel. There is such a number of them that time does not really permit me to cite them all. I can cite them from every area of the country, whether it is Intera Environmental Consultants of Calgary or SED Systems of Saskatoon which is a very well known company to Canadians, certainly in that area.
I should perhaps refer to one program which I believe was directly a result of some of the programs of the Department of Supply and Services which I referred to earlier. It is the Services Converto-Braille-Cypitot-Galarneau of Hull, Quebec, which has permitted the development of a computer terminal that gives the blind access to information services such as Telidon, which is another great Canadian technological achievement, the Canadian Press News Services, libraries and so on.
We have much world-class technology in Canada. We are starting from a very sound base. When we look at this motion, which I do not have a great deal of quarrel with apart from the

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conclusion, I think we should bear in mind that we are moving forward from an enviable position and have not allowed Canada to stay in the backwaters of technology and innovation as so many observers have often suggested.
Reference is made in the second part of the motion to a policy which supports the rejuvenation of existing industries. We all know that many countries in the western industrialized world today are faced with the phenomenon of the so-called sunset industries. Hopefully, some of these industries can be moved from the sunset back to the sunrise through the application of new technologies. This Government is attempting to do this.
I expect that most Members of the House are familiar with the very substantial financial commitment that this Government has made to that very issue of rejuvenation of existing industries in order to bring them back into a competitive position. I need only mention such programs as ILAP or C1RB, which is directly concerned with the so-called soft sectors-

-or the "secteurs mous", as they say in Quebec, namely, textiles and footwear. It is therefore very important to realize that we have made a real effort in those areas. If I remember correctly, we spent $267 million on this program, which is aimed at improving and updating companies in these sectors and also at assisting employees who will be affected by the conditions in the sectors in question.

It is exactly in the spirit of this motion that the Government has in fact moved. As I have said, there is $267 million in that program alone, not to mention an additional $400 million, as I recall, in the ILAP Program to provide industrial adjustment assistance both to industries and, of course, to the employees themselves, who are affected because emerging technologies in other countries and lower labour rates have had a dramatic impact on their ability to compete in international markets.
The motion also refers to the creation of new employment and the maintenance of existing jobs. There is no doubt in anyone's mind that the new technologies and the modernization of plants will have an impact on the job market. Therefore, there is perhaps a certain amount of paradox in the motion when we are being told, on the one hand, that we should introduce new technologies but should maintain existing jobs, on the other hand. That does not mean that we cannot create new jobs, but I suggest that the introduction of new technologies, such as robotics in the automobile assembly line which was referred to earlier, are bound to displace assembly line workers. I do not think there is any doubt of that. It is somewhat incompatible to say that we are to maintain existing jobs and improve productivity at the same time by introducing new technology.
By the same token, I would say that Governments, industry and labour working together must come to grips with those jobs that are displaced through retraining programs, and
efforts to bring those people who are affected by new technologies to a level of education and "formation" which will enable them to take advantage of the new and exciting opportunities that technology itself brings.
For every robot that one puts on an assembly line, there will be requirements for additional technicians, engineers and programmers who will be responsible for the software that will go into the micro-computers which will operate that robotics system. In fact, many of the jobs that will be displaced will be jobs that will be unattractive. They will be arduous jobs that will be replaced by more stimulating and challenging jobs. The quality of the work environment will, in turn, improve. But at the same time, there is that transitional period through which we as Governments must pass; and I say as "governments" because much of this responsibility must be shared with provincial Governments as well as other sectors. We must ensure that the workers of this country are not fearful of that necessary change because we know that they in turn will be protected from the harsh effects of that change and will prosper from the benefits which new technology will bring. However, I say that it would be unrealistic to suggest that new technology will not have an impact on some of these existing employments. In fact, it should have, because we should replace some of those dreary, assembly line and clerical jobs with ones which are more challenging and better paying.
I would now like to turn to the last part of the motion wherein the mover, the Hon. Member for Scarborough East, in the normal way condemns the Government, and the condemnation was understandably supported by the Hon. Member for Regina East. As stated, the motion reads:
-condemns the Government for its neglect in failing to aggressively develop policies to promote the advancement of science and technology in this country, for its lack of interest in utilizing and increasing Canada's human potential, and for its failure to adopt the spending targets for science and technology that were established by the Progressive Conservative Government in 1979.
Allow me to say that, in the few minutes I have been on my feet this afternoon, I believe I have underlined and pointed out a number of programs which have been very successful. When we speak of Government effort, let us consider the record of rhetoric instead. It is all very well to have "targets", but what we on this side of the House look to is performance. I would like to point out to the House that we have steadily moved up our commitment since assuming office in 1980, that we are right on track in achieving 1.5 per cent of GNP and R and D by 1985.


An Hon. Member:: One hundred and fourteen jobs in Ontario.


Donald James Johnston: In 1980, it was 1.07 per cent, and in 1982, it was estimated to be 1.2 per cent. I suggest to Hon. Members that in 1985 it will be 1.5 per cent. It is my wish and that of other Hon. Members in the House that that trend continue so that by the year 1990 it will be 2 per cent or even better.


An Hon. Member:: Are those as good as last year's projections?
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Donald James Johnston: Let me give some more striking examples in terms of annual incremental percentage growth of commitment to the gross expenditure on research and development in various sectors. In 1980 we increased the federal commitment by 15 per cent, in 1981 by 21 per cent, and in 1982 by 17 per cent. More importantly, the incentives which we have provided to the private sector permitted the industrial sector to increase its 1980 percentage by 18 per cent, by 26 per cent in 1981 and by 23 per cent in 1982. The NDP critics have said that industry is not doing its share. Industry is indeed beginning to do its share in a most dramatic way.
While we are on the subject of targets, I was reading a speech by the former Minister of Science and Technology for the Conservative Government, Mr. Grafftey, given back in 1979.


Ian Gardiner Waddell: Not a bad target.


Donald James Johnston: He was discussing the university sector and told us that the Conservatives would increase funding to NSERC to 32 per cent. He made the announcement that there would be a 32 per cent hike in 1980-81. Of course, the Conservatives were not in power in 1980-81, but I would like to point out that we took office and it became 34 per cent under a Liberal Government.


Some Hon. Members:: Hear, hear!


The Acting Speaker (Mr. Blaker):: Order, please. I would imagine that the House would have no difficulty in extending the courtesy to the Minister of allowing him to speak for a couple of moments in order to complete his remarks. However, as the person in the Chair, I do not have the privilege of extending that courtesy automatically.
Is there unanimous consent to permit the Minister to speak further?


Some Hon. Members:: Agreed.


Donald James Johnston: I thank Hon. Members of the House for their indulgence. I will finish my remarks very quickly. Because of the importance which we all attach to the matter, I will finish on a very non-partisan note. I made the point concerning NSERC. Those are the facts, and I think an examination of the record will clearly demonstrate the commitment of the Government to R and D. Notwithstanding cutting back in other sectors, the Government and Members of this side have consistently prodded for more and more spending on research and development.
I was very impressed with the intervention of the Hon. Member for Scarborough East, perhaps more by his comments than by his motion, because when he came to the end of his comments, unlike most spokesmen for the Conservative Party he actually put forward a number of concrete suggestions.


Walter David Baker: They were pretty good too.


Donald James Johnston: He put forward the kinds of things which a technology policy, in his view, should embrace. He suggested that we should be building on the comparative advantages of this country and he referred to the resource base. We all agree
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with that. He said he wanted to emphasize that the private sector has an important role to play in research and development. Not only do we agree with that, but the numbers to which I have just made reference also show this to be true.


Ian Gardiner Waddell: You are a Tory, Don.


Donald James Johnston: I would suggest that, notwithstanding the criticism we have heard of the fiscal system, Section 37 of the Income Tax Act has been instrumental in providing incentive to the industries of this country to invest in R and D. In fact, it is one of the most generous provisions of its kind in any western industrialized nation. That is not to say that it could not be modified. That is not to say that it cannot be improved, and it will be improved if it needs to be improved. However, I am saying for the record that it has been very successful in attracting funds into the R and D sector.
The Hon. Member has referred to the necessity of advancing technology and applications of new technology in the industrial sector, what is commonly referred to as "innovation". I agree with that as well. He spoke of a favourable environment being created for research and development and for venture capital. We agree with that. He spoke of the importance of having a co-operative relationship with provincial Governments. I agree with that and would like to encourage provincial Governments to devote more of their resources to R and D. In fact, in each of my meetings with provincial Governments in my role as Minister of State for Regional and Economic Development, the issue of technology has been one of highest priority. I can assure Your Honour that we will be working closely with the Provinces to ensure that we create a synergism so that not only will we be able to spend 1.5 per cent of Gross National Product on R and D by 1985, but also that it is well spent to ensure that the desired results of those targets, which are important, are achieved.
The Hon. Member emphasized the importance of strong basic research through such organizations or institutions as NSERC. We agree with that. He dealt with the awareness issue at some length. Nothing could be more important than making Canadians aware of the opportunities awaiting us as a nation if we embrace these areas of advanced technology. I know that the Hon. Member for Vancouver Kingsway (Mr. Waddell) said the same thing in the House some weeks ago. He was then quite constructive as well. He also spoke of the importance of Government procurement in terms of developing technology.
I realize that I am going on a bit, Mr. Speaker. Let me just say that there is a paper before a number of my colleagues on technology policy, and I can assure Hon. Members of this House that not only will it address all of the issues which have been raised here today, the constructive issues and suggestions, but that it will also go much further in some areas. I look forward, on the basis of today's exchange, to the support of Members in this House from all Parties when these policies are presented.

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I thank Your Honour, in particular, and other Hon. Members of the House for allowing me to speak beyond my time limit.


Some Hon. Members:: Hear, hear!


The Acting Speaker (Mr. Blaker):: The Chair will recognize the Hon. Member for Northumberland-Miramichi (Mr. Dionne) to ask a question and, following that, other Hon. Members.


Mr. Dionne (Northumberland-Miramichi):: Mr. Speaker, I would like to direct a two-part question to the Minister. I was happy to hear him say that one of the roles of research and development is to maintain employment and to help find alternative employment for those whose jobs are affected by new technology. I want to remind him that in my own constituency, 1,500 jobs are affected by new technology in national defence. Can we count on the full resources of both of his Ministries to help us find alternate employment and job opportunities on the Miramichi so that the peole of Miramichi will be able to lead productive lives?
In his comments, he also referred to the National Research Council. I agree with his laudatory remarks. However, I remind the Minister that New Brunswick is the only Province in Canada which does not have a unit of the National Research Council. I ask him to consider the establishment of a unit of the NRC at the about to be closed base in Chatham, so that it will have a research base to attract other industries to the area.


Donald James Johnston: Mr. Speaker, in response to the question of the Hon. Member, the Government is very sensitive, as he knows, to the problems faced by him in the Miramichi area, particularly with respect to the Chatham base. Every effort is being made to find alternatives which will provide employment for the people affected in that area. Through the initiative of the regional Minister, the Member himself and others, the Government has taken initiatives in New Brunswick such as the establishment by Mitel at Buctouche of a facility which is very significant in terms of high technology in the area.
With respect to the NRC, there are projects under consideration. I am not sure I can give an assurance that they should be placed necessarily on the Chatham base, but there is no doubt as technology improves that it should be available to every region of the country by national institutions, and that is our intention.


Mr. Greenaway:: Mr. Speaker, my question is directed to the Minister. It concerns the policy paper which is now before Cabinet. We have awaited this paper for quite a while. I know that he has taken some time to put it all together and that he is in a new position, but I expected that it might come out before the Christmas break. Can the Minister give us any idea when it will come out? Will it address the serious problems in the forest industry which could be remedied by putting research and development money into that industry?


Donald James Johnston: Mr. Speaker, I see my role as Minister of State for Economic Development and Minister of State for Science and Technology as really trying to establish a framework with my colleagues within which various programs can move forward by line departments. There is no doubt that there is important research and development to be done in the forestry sector. It has to be done. Unfortunately, during a period of recession of the kind we are experiencing, companies in that sector are less inclined to invest in research and development because they are simply trying to meet payrolls and to fund ongoing necessary costs. That point has been made to us. It is not a problem, I might say, that is unique to the forestry sector.
We are indeed moving forward in that area. In fact, the issue of the forestry sector will be addressed in some detail this weekend at a caucus gathering in Thunder Bay. I expect we will have a good exchange of views and some very clear suggestions by Members from the areas affected by the problems in the forestry sector and the lack of research and development in that sector.


Ian Gardiner Waddell: Mr. Speaker, the Minister talked glowingly about more stimulating jobs. Is he aware that many women across the country today are working on word processing machines for not very much more money? Even if one wants to go to the washroom, one has to plug in a key. In the old days one had to ask the boss or the foreman; now one has to ask the machine. Does he really think that is progress?
The Minister speaks highly of sunset and sunrise industries, the winners and the losers, like all Atari Liberals do. Is he aware of a recent study from Massachusetts of one area which got into high-tech that showed the salaries for a few people- engineers, programmers and so on-went very high, but that the rest of the people had to go into the service industries with low-paying salaries. Compared with the way society used to be with older-type industries such as steel manufacturing and so on, where people made the same salaries, the community has basically changed.
Is that the kind of Canada he would like to see when he speaks about more stimulating jobs? Does he recognize the kind of danger inherent in the new high-tech industry about which he so flamboyantly and conservatively speaks? Does he see the danger? What steps would he take to prevent the kinds of things which are happening now, as indicated in the first study conducted in Massachusetts?


Donald James Johnston: Mr. Speaker, I think the Hon. Member for Vancouver-Kingsway (Mr. Waddell) is speaking very much with his tongue stuck in his cheek. Not too many weeks ago I heard him speak in the House, and he certainly did not sound like a neo-Luddite, as he seems to today. The inference I would draw from his remarks is that he feels Canada should reject the technological revolution which is reshaping industries all over the world.
I do not think Canada has a choice in joining that revolution, if we intend to maintain the standard of living to which Canadians have not only grown accustomed but to which they
February 4, 1983

are entitled, given the potential of the country both in terms of natural and human resources. It is our job to manage the technological change. It is our job as a Government to take the lead, and be seen to take the lead, in managing that technological change for the benefit of all Canadians and to ensure that the kinds of problems to which the Hon. Member alluded do not take place. Essentially, that is the point I attempted to make during my remarks.


Charles Henry (Chuck) Cook: Mr. Speaker, I wish to congratulate the Minister. He has learned his lesson in law school well, that when one has a weak case, assertively state it and volubly state it. He has certainly done that today.
I have two quotations on which I would ask him to comment. The first is from Dr. Larkin Kerwin of the National Research Council wherein he said:
We currently spend less than any industrialized country on new research.
In other words, we are the worst of all. I would also point out to him that by 1985 Japan will be spending 4 per cent on research, compared with the magnificent sum of 1.5 per cent about which he talked for Canada. Most industrialized countries are over 2 per cent right now.
The second quotation is one from Jack Donegani, President of the Professional Institute of the Public Service of Canada, wherein he talked about the Liberal Government and said:
-the Government has deliberately allowed Canadian federal laboratories to suffer through a decade of stagnation since the Lamontagne Commission's review of Canadian science policy. During this time, there has been inadequate hiring of newly trained scientists except to replace retirees. Opportunities for Government scientists to keep their training up to date have been inadequate and active participation in scientific conferences, workshops or professional committees requiring occasional travel has been restricted to an absurd degree.
In view of his beautiful words about what the Government is doing, how does the Minister respond to these two quotations?


Donald James Johnston: Mr. Speaker, if the accusation is that we should be doing more as a country, I would agree with it. I concur with Dr. Larkin, but if we are to do more, let us do it in a way which reaps the best possible benefits for the country. Let us not throw money at a problem. Let us make sure that the funds which are being spent are expended well and effectively. This means that we should not have duplication and conflict in different regions. This means that we should put our shoulders to the wheel and have a real national effort on research and development. We are moving very quickly in that regard.
By adding vast sums of money before the communities have put in place the necessary infrastructure and laboratories, the necessary engineers and skills at the university level, supported by the Provinces in particular because they have responsibility for university education, we have to move in a way which maximizes the contributions we are making and does not create an enormous amount of waste. In so far as the latest numbers I have for several countries in 1980 are concerned, it is true that we are behind. We were at 1.02 per cent of the GNP. France was at 1.83 per cent, Japan was at 1.95 per cent and the United States was at 2.47 per cent. None of those
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countries in 1980 was at anything like the 3 per cent, if I recall that the Hon. Member suggested.


Charles Henry (Chuck) Cook: Mr. Speaker, I rise on a point of order. The Minister was talking about 1985. The projections for Japan in 1985 are 4 per cent.


The Acting Speaker (Mr. Blaker):: Order. That is not a point of order. The Hon. Member could have risen on a question or a comment if he wished. 1 urge him to continue during the time available with his comment.


Walter David Baker: Mr. Speaker, I wonder if I could direct a question to the Minister. The Minister mentioned that there was a paper being submitted to some of his colleagues, and possibly to a Cabinet committee, emanating from his Ministry. I know he cannot be specific, but is there contained in it proposals for tax and other financial incentives with respect to the development of the high technology industry, particularly small business and the development of new business?
Second, does it contain, or has the Minister addressed in any way, proposals with respect to retraining of people who may be affected as a result of the development of the high technology industry that has been referred to? Does it address those two things? Third, when may we expect to see the paper tabled?


Donald James Johnston: Mr. Speaker, first of all, when I spoke of a paper I indicated earlier that I would be bringing forward a technology policy paper, which I am now doing. For some time I have had consultation and consideration in many areas. Obviously I am not at liberty to disclose to the House what is contained in that paper. I certainly will give assurance to the House that it is broad in its application in the area of technology policy in the industrial sector.
I might add that the kind of issues that the Hon. Member for Nepean-Carleton (Mr. Baker) raises are, of course, already being addressed. The issue of fiscal incentives has been addressed. Recently some guidelines were issued to clarify some of the interpretations that have been given by the Department of National Revenue with respect to the so-called scientific research investment contracts. These matters are constantly moving forward and being reviewed. As a former Minister of National Revenue, the Hon. Member is fully aware of the activities of the interpretation section of that Department.
With respect to the issue of retraining, that is a matter which is being pursued constantly by the Minister of Employment and Immigration (Mr. Axworthy) through the National Training Act and other instruments. That is not to say that more should not be done. As ongoing assessments indicate to what extent technology will affect employment in these sectors, clearly action and perhaps supplemental action will have to be taken because retraining is of fundamental importance, not only to ensure that these people find jobs, but to

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eliminate a certain amount of the anxiety that appears to exist in many circles with respect to the impact of technology.


Walter David Baker: Mr. Speaker, when will the paper be ready?


Lorne Everett Greenaway: Mr. Speaker, one can sense an increasing awareness in this country, an awakening to the fact that we are being rapidly left behind by other more enlightened and adaptable industrialized western nations. The truth is that we are now clearly behind-left in the starting gate-in what is becoming known as the second industrial revolution, change brought on us by new technologies.
For an obvious example of how far out of the race we are, one simply has to check brand names of products sold in outlets retailing TV sets, radios, calculators, computers and other electronic gadgetry. It would be interesting to know how many Sony Walkman radios were sold this past Christmas.
After experiencing the last two years of economic turmoil in this country, many Canadians, especially those out of work, realize that something is drastically wrong. Most now sense that we must become much more than a nation whose economy is based upon the sale of its raw materials. If one examines employment statistics over past years, it can be seen that there has been a serious and growing unemployment problem in this country, long before the present recession began.
In 1966, 251,000 Canadians were out of work. By 1970, it was 476,000, by 1976, 727,000, in 1980, 867,000. Now it is in excess of 1.5 million. In fact, I heard today it is actually 1.6 million. Obviously the number of people unemployed has grown faster than the economy. Even in the good years of the sixties and seventies, unemployment was increasing and we were losing ground. A large portion of the unemployed are new entrants into the labour force, young people and an increasing number of women. I will refer to the problem of unemployment and women later.
We desperately need more jobs, not jobs of the temporary type provided by a number of Government short-term programs. 1 do not think the real and permanent-type jobs I refer to are going to come out of the resource sector. It seems logical that a good many will come out of the service sector, but the majority will have to be provided by manufacturing. This will not happen if we do not base our own economic future upon technological development. Our economy must be based upon new technologies.
Successful industrialized countries have long since realized that strong economies are based on a healthy level of research and development. This, of course, must be in tune with Government policies that create incentives for the risk-takers, a factor that is fast disappearing in this country.
We have long ago passed the period where unemployment can be solved by putting workers on the public payroll. Last year the National Research Council estimated that if Canada's 1,000 high-technology firms doubled their gross output by 1990, the net benefit to Canada's balance of payments would
amount to $12 billion and, what is so important, 650,000 jobs would be created.
The Canadian Government must, of necessity, concentrate upon working with business and labour in order to solve our economic problems. By now this Government should have realized that we are in a crisis situation. It is usual in times of crisis for all people, for all sectors, to pull together for the common good. If we hope to regain our position in the world, we must have a well-planned industrial strategy in this country. It is years and years overdue.
Industry and labour have recognized this for a good long time. Industry has also realized during this recession that, with a few exceptions, it cannot depend on Government for help. In actual fact the federal Government has appeared to be little more than an aimless spectator in the economic shake-out in the past two-years.
At a recent Toronto seminar sponsored by the Conference Board of Canada dealing with the drafting of a national industrial strategy, Mr. John Shepherd, Chairman of Leigh Instruments of Ottawa, said:
-the private sector has been too passive and defensive in front of government, waiting to react rather than hastening to contribute.
I believe that our job is to insist on a more intelligent framework, a better ordering of priorities . .. and to help bring to bear on government a better sense of the market forces which are and will be at play . . . We need to inject ourselves more forcibly and responsibility into that process.
Labour is also anxious and willing to co-operate. At the same Toronto meeting Shirley Carr, Executive Vice-President of the Canadian Labour Congress, also called for a national industrial game plan. She said:
-the creating of an atmosphere wherein shared decision-making power amongst the actors can occur is mutual recognition . . . labour has a legitimate place in Canadian society-a place that not only includes the right to organize and represent workers through collective bargaining, but also extends a seat at the table at all levels of decision-making.
One of the key elements in the Japanese success story is an industrial strategy that incorporates input from many sectors. Before any changes are made, or new initiatives taken, the Japanese Government consults with and seeks advice from representatives of industry, labour, universities and the mass media. Therefore, when a new policy affecting industry is announced, it is widely supported and is effective because of a spirit of co-operation. The Japanese strategy now has the industrial sector supporting 65 per cent of that country's research and development. Long-term, risky and expensive research is left to the Government. Recently, the Japanese Government spent $5 billion in U.S. currency in building a research centre near Tokyo which houses 40 different research groups.
I know that in this country previous and present Ministers have been canvassing representatives of industry. The previous Minister found that industry was concerned with a number of issues. Lack of start-up capital, difficulties with debt financing, a need for research and development tax incentives and a desire for more collaboration among Government, industry
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and universities were subjects brought to his attention. I am sure the present Minister is going over the same ground. I hope he includes labour in his discussions. The pity is that this Government has spent too much time studying and too little time implementing, and now we are falling well behind our competitors.
My colleague, the Elon. Member for North Vancouver-Burnaby (Mr. Cook), in a question to the Minister, quoted from a letter from Mr. Jack Donegani, the President of the Professional Institute of the Public Service of Canada, which appeared in today's Globe and Mail. I would like to quote again from that letter. The heading reads, "Stronger position urged on high-technology policy". It goes on to read:
The Professional Institute, which represents some 5,000 scientists, for years has been pressing the Government to develop and encourage research and higher technology in Canada in general, and within the federal service in particular. It has urged the Government to recognize the obvious, that advanced research and technology are imperative to the wellbeing of every Canadian, to economic development, to health, safety and security.
The institute, therefore, urges Mr. Johnston to take a stronger position in Cabinet on this issue.
We are also being warned by the Science Council of Canada that the United States and Japan are front runners in microelectronics, and Canada would be "hard-pressed to catch even the less advanced "second-tier" nations in Europe and Scandinavia". The micro-chip, a tiny silicon block which can be the equivalent of up to 500,000 transistors or more, is revolutionizing manufacturing in advanced industrialized countries. To the best of my knowledge, Mr. Speaker, the Liberal Government has only dedicated about $10 million in chip research. By contrast, other countries have sensed the crisis situation which exists. France, for example, has launched a five-year, $27 billion program to ensure that she becomes a world power in computers, office equipment and consumer electronics. The $27 billion will be spent on new plants, research and development and on various subsidy programs. "Made in France" stamped on electronic gadgets will soon be as common as "Made in Japan". West Germany has a three-year $225 million program under way which grants firms up to $400,000 to promote the use of the micro-chip in their plants and products. Interestingly, applications for grants take an average of only three weeks to process. Contrast that, if you will, with the time it generally takes to get money from our federal Government for any such program. The urgency of the situation is well understood by other countries.
The micro-chip is revolutionizing the world and Canadians must realize what this means. Women, especially, are going to feel its effects. Many jobs traditionally held by women, such as in offices, as bank tellers, retail clerks and telephone operators, will be lost. In my home town of Williams Lake, British Columbia, 50 telephone operators will lose their jobs to new technology in mid-1984. Yet little, if anything, is being done to direct women from areas which will be hit hard by efficiency and productivity improvements resulting from the implementation of micro-electronic technology. Women must awake, unite and demand quick answers from Governments, industry and labour to this very urgent problem.
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I suggest to the Minister and the Government that they must place the subject of technological change, and our failure to recognize the importance of research and development, on a very urgent priority basis. They must use research and development as the foundation of an industrial strategy. I suggest a conference of the federal and provincial Governments, industry, labour and representatives of our educational system should be held immediately with a view to positive direction and immediate action. We have talked for years, Mr. Speaker, about what we are going to do in this country as far as research and development and industrial strategy are concerned. Time for talk is long past. We must act. If we fail to realize the importance and urgency of the second industrial revolution, we will pay very dearly.


Miss Aideen Nicholson (Trinity):: Mr. Speaker, I listened with great interest to the remarks of the Hon. Member for Scarborough East (Mr. Gilchrist) this morning, and he placed in a very interesting context the whole question of research and development, which he also linked with tax policy and macroeconomic policy and, indeed, strategy on economic development.
After a very difficult period in the world economy, we are now seeing some indicators which are encouraging, and it is important now that the remainder of the 1980s be a period of economic renewal for us, of ensuring Canada's prosperity. Our traditional industries are the backbone of Canada and they can and should remain the source of jobs and income for thousands of Canadians. With continued productivity improvements and new marketing techniques, the traditional industries, such as fishing, forestry, mining and agriculture, can play a central role in Canada's future economic prosperity. When combined with advances in high technology sectors and the securing of Canada's industrial heartland, a positive climate of growth will re-assert itself, allowing for the necessary market adjustments to keep Canada competitive. And with growth we will have the opportunity of ensuring that every region of Canada benefits. The challenge of economic renewal calls for the co-operation of all of us, the federal and provincial Governments, unions, management, academics and consumer groups. We need to deal competently and humanely with the present and we need intelligent medium and long-term planning.
Japan provides a startling example of what is possible, and a number of speakers today have made reference to this. Poorly equipped to deal with the energy crisis, Japan has nevertheless performed very well. The key to its success has been industrial re-deployment, harnessing the most advanced technologies in order to achieve overwhelming competitive advantages. Between 1970 and 1974, while the rest of the OECD countries were worrying about short-term issues, the Japan Computer Usage Development Institute, a Government sponsored body, developed a long-term econmic strategy to make full industrial use of the then infant technology, micro-electronics. This, coupled with advanced Japanese management methods, helped propel Japan to its present industrial position.
The long awaited world economic recovery will not solve Canada's structural problems. Newly industrialized countries,

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such as South Korea, Taiwan, Hong Kong and Singapore, are using their low labour costs to achieve comparative advantages in many conventional industrial fields, such as textiles, shoes, light machinery, calculators and so on. The reindustrializing countries, such as Japan and France, are threatening both Canada's traditional industries and our high-tech sectors. Canada may have to follow the example of Japan and France and draw a blueprint for a long-term economic development plan based on micro-electronics. But the emphasis on high technology should never be interpreted to be at the expense of Canada's traditional industries. On the contrary, high technology innovation holds the potential for remarkable productivity gains in our traditional industries and, therefore, for greater job security and improved salaries for core workers.
We are blessed with natural resources and they can and should be tapped in the most profitable manner possible. We are also blessed with a competent and well educated work force. While they may have to retrain, as the Minister has just said, they are better equipped to do so than the labour force in the countries of some of our competitors. Faced with these new challenges, we need to open up the decision-making process. We need input from scientists, but we also need input from the people actually doing the job, and we must be very concerned to keep our human values. Speaking in this House on February 6, 1981, I said:
When I talk about an industrial strategy, I think of a set of policies, of an orderly and integrated way of co-ordinating government policies and, above all, of a human approach with care for the ideals of social justice, for individual dignity, for safety in the workplace and for industrial democracy. Occupational health and safety must be a particular concern at the present time, because we are still losing far more days of work and industrial productivity as a result of illness or injury on the job than as a result of strikes. Unless there is a progressive sharing of the material wealth of society, unless there is active participation in decision-making by the workers who produce that wealth, we will not succeed and, perhaps, we would not deserve to succeed.
In my view, Mr. Speaker, those principles also apply to the application of new technology. Firms facing the need to improve productivity often think first of reducing staff. Yet there is substantial evidence that industrial engineering approaches are more effective. Workers know the processes, know the plant, and if they are actively involved in decision making they can often point the way to procedures which allow the same number of people to stay at work but work in ways that yield greater profits and job satisfaction. The moneys which the federal Government has made available to labour for continued education are being well used, and are increasingly resulting in well informed and sophisticated labour leaders who have much to contribute to our future industrial development.
These people-oriented initiatives may not sound as glamorous or exciting as talk of industrial restructuring and technological innovation, but it is people who will bring forward and implement solutions. In these times we need new ideas and continual examination of the adequacy of our policies and programs.
The very rapid changes in the international economic order demand of Canada an extremely alert business intelligence system and response mechanism. The cornerstone is the free market sytem with its built-in incentives to keep pace with or ahead of international development. But one must ask, could this cornerstone be more effectively supported by Government? Public interventions are often viewed by the private sector as restrictive. Yet the private sector is frequently unable to mount effective competition in the international field without direct or indirect Government support. The success thus far achieved by the Telidon project, for example, would not have been possible without major Government participation in research and development, manufacturing seed-money and marketing. Similarly, the recent Bombardier deal in the U.S. was secured in part because of Government support in allowing for low interest loans to finance the operation.
There are, of course, significant success stories which are a credit to the Government's initiative and the entrepreneurship of the Canadian private sector, for example, Northern Telecom, Mitel, NABU, and so on. Yet the public-private interface in Canada is not carefully brought out, and golden opportunities are sometimes missed. There is, in my view, a gap in coordination between the private and public sector. However, there are several other important gaps. Federal-provincial confrontation frequently prevents co-ordinated development strategy; Canada's labour-management interface is the adversary system with too much mistrust prevailing on both sides; the University-Government interface is not so much an adversary system as a tradition of mutual indifference, in sharp contrast to the experience in European countries and Japan. A positive creative force must replace the apprehension and fear which pervades so much current economic thinking. A proactive and concerted strategy is called for, one that associates Government, labour and management and universities in a long-term planning exercise, and which distributes the fruits of innovation in such a way that as many people as possible, if not everyone, benefit. Harmonization of public and private policies, labour and management aspirations, and of federal and provincial interventions must be the wave of the future.


Charles Henry (Chuck) Cook: Mr. Speaker, I would like to approach this subject perhaps from a slightly different point of view from what we have heard. I believe the case has been made on all sides of the House that we are spending an inadequate amount of money, we have no over-all plan for research and development and, as a result, we are faced with an unemployment situation which is tragic for a great many people. My comments are directed to the parents of Canada and, I suspect, to anyone who has yet to determine what his or her eventual career will be. Even if they are pursuing a career, I would ask them seriously to consider taking a look at the broad field of science and technology, because that is where the future lies.
Diebold is perhaps one of the leading management philosophers of the world. In the 1950s he made this statement, and I see no reason to doubt it, particularly at this time, that every person would likely have seven different occupations in the
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course of his lifetime. Even then Diebold could see the revolution which has been taking place.
Initially we went through the age of crafts and guilds. That led into the industrial revolution, mass production and factory jobs. Now we have another revolution upon us. We are entering the age of servo-mechanisms and the robot. I am delighted, because in the initial stages men became slaves to machines, and we now enter the new world where machines will be slaves to men. Every man must do all he can to take advantage of what is taking place. The future holds many areas of great growth that will bring hundreds of thousands of new jobs that were not even contemplated a few years ago. We do not know what the next major breakthrough will be, but we know that those who educate themselves in the sciences will be able to adapt much more easily and rapidly to what may come.
A good example is biological research. Do young people realize that we have developed enzymes that eat oil spills and that there are also enzymes that separate oil and sand? Then there is the whole area of the human condition and drugs and blood. And where are the biological breakthroughs that will change waste into useful products?
When I speak of science 1 do not mean just industrial research which makes use of what comes from pure science. Pure science is responsible for the laser, and industrialists are responsible for the literally thousands of uses that laser has been put to. Fibre optics came from pure research, as did the silicone chip. If we do not raise the amount of moneys available to universities, even without knowing what developments may result, then we must take a back seat to the rest of the world. It is from pure research and pure science that new developments come.
Young people should consider some of the following areas when thinking of careers. We have yet to develop the perfect ship. As a Member from the Pacific coast, I believe that the perfect ship is long overdue. Then there is the whole area of oceanography. The pittance that we spend on oceanography when we are surrounded on three sides by water, is ridiculous. Fish farming is another area, as is the whole area of agriculture in one form or another.
I should like to ask this and any succeeding Government of this country, where do the priorities lie? Where is their understanding of what is happening in the world? Where is Canada's George Washington Carver, the man who, in the 1920s, found over 100 uses for the peanut? Does anyone think that we would ever have had insulin if Banting and Best had had to deal with a bureaucratic structure of Government like that which exists today?
Where are the new strains of wheat? Disease-resistant wheat has been developed but little research is being done on wheat for new uses or on new crops. That is where the future of our country lies, but not sufficient work is being done in those areas.
With all due respect I would point out that the average stenographer, male or female, is as out of date as the buggy
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whip salesman is today. Advertisements for help in the newspapers call for people with knowledge of computers or word processors. What a marvellous thing it would have been if this could have been foreseen five or ten years ago. Perhaps we could have arranged for this type of training in the schools a long time ago and have the people available today. Now we are attempting to catch up, but unfortunately a lot of people will be left behind.
A revolution is taking place in the office today. The word processor and the small computer are changing the nature of the individual office in the country more than the invention of the calculator or the typewriter did 50 or 60 years ago.
Where are the jobs going to be in the future? Despite the neglect by the Government and despite the fact that we are not doing what we should in terms of research, science offers the greatest future to young people.
I have no hesitation in taking another man's words when he expresses in a better form what I wish to express. In November, 1981, Dr. Larkin Kerwin of the National Research Council said:
We are a nation rich in ideas. Japan does so much with so little; we do so little with so much.
At that time he also said:
If we fail to exploit these current technological opportunities, or fail to develop new ones continually, we may still survive as woodcutters. But we must then be content with a woodcutter's wage.
The young people of this country should think about that, Mr. Speaker. They should think whether they want to be woodcutters or have a meaningful career. When I speak of science, I do not necessarily mean that one has to be a research scientist with a PhD, working in a university. 1 mean that they should take as much science as they possibly can. There will always be captains, generals, sergeants and troops, and the more training they have, the further up the ladder they will be in the new industries of the future.
Tomorrow, there could be a breakthrough that could mean that Five years from now hundreds of thousands of jobs would become available through something that we do not contemplate even in our wildest dreams at the moment. Just look at the explosion that has taken place with computers. To paraphrase a line from Time magazine, if the automobile industry had gone ahead as rapidly as the computer industry has, today you would be able to buy a Rolls-Royce for $2.40 and get 400 miles to the gallon of gasoline. IBM sends its senior computer people into the field for a year, then they must go back to school. They go back to the field for another year, and back to school again. The company believes that if senior computer people are left in the field for two years, they will not be familiar with the technology that is being developed.
At the present time Canada spends less on real research than any other industrialized country, says Larkin Kerwin. Not all the National Research Council's projects under the Industrial Research Assistance Program were sure-fire winners. The average was $20 in sales for every dollar of NRC R and D funding. But 80 per cent of the projects have led to

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direct or indirect benefits. Just under half of them produced $1.8 billion in sales, 16 per cent are confidently expected to produce sales in the future, while 24 per cent gave indirect benefits. When a research body can produce as many jobs and as much wealth for the country as that, then it is very, very foolish for a government to starve it to death as this Government has been doing for years. If the Liberal Government had put that kind of emphasis on research and development when it came in with the Prime Minister (Mr. Trudeau) in 1968, I doubt if there would be any unemployment in the country today.
We just have to look at what Japan has done in terms of research and development and see how it has affected their standard of living. Their economy is far ahead of ours.
In 1968 we spent 1.4 per cent of the Gross National Product in the vital area of research; today we spend only 1.13 per cent, which is up 0.9 per cent from two years ago. Fifteen years after 1968, the Government has moved the target back up to 1.5 per cent for 1985. To reach this modest target, R and D spending must not only outstrip inflation, it must increase in real terms by 18 per cent per year. These are staggering figures. But as a percentage of population Canada had one-third as many people working in research and development as did the Swedes, the Germans or the Japanese. We had one-half as many as the Dutch, the French and the Americans. We spend less per capita on research and development than all industrialized nations, with the exceptions of Ireland and Iceland. That is a record of which we should all be thoroughly ashamed. In fact, if we raise our percentage of GNP expended on R and D by just one percentage point, we could ultimately provide one million new jobs in this country and generate those $20 billion in new manufacturing sales.
I believe that requires some dramatic tax reforms regarding investments in high technology. If this country can afford to give total write-offs on third-rate motion pictures, we can certainly do no less for high-tech investment which will ensure a viable future for our children. To me it is deplorable that this country and this Government do not realize what the pay-offs are in research. This Government brags about this scheme or that scheme. Some are excellent, and for this they ought to be complimented. But we have a philosophical base here which is dead wrong, in my view. That philosophical base is grants, which means the Ottawa bureaucrats decide which company goes ahead and which company does not. Bureaucrats are not good businessmen. As a Conservative, 1 believe that what should be done is to have a system of incentives. What we should do is to say, "There is the incentive. Go after it, fellow. If you make it, great. If you are inefficient and you cannot do it, down the drain you go." But incentives for research and development should be given to all through the tax system. We should not have bureaucrats trying to run the whole show. We have seen the disastrous results and the wasted taxpayers's dollars when bureaucrats have made terrible errors in judgment.
In conclusion, I want to quote from what Mr. Walter F. Light said. He is the President and Chief Executive Officer of Northern Telecom Limited. Last April he said:
R and D, like capital spending in plant and equipment, is not an expense, it is an investment in the future. High technology companies must constantly innovate to maintain their leadership and ability to compete.
The commitment to research and development must be consistent and long term. In the long run, the winners will be those companies that maintain R and D investment in every economic climate and, when their profits are rising, recognize this as an opportunity to step up their R and D spending to an even higher level.
To compete, a company, an industry, or a country, must pursue a clear strategy, focusing its efforts and resources on the areas of greatest opportunity. It must maintain a consistent and growing commitment to research and development. It must invest in the development of people in schools, in universities, and in business. It must move quickly and decisively to respond to market opportunities.
Mark Twain made a statement on the weather. Everybody talks about it but nobody does anything about it. The weather is another major area for research. But I think we have talked enough about research and development. It is almost like motherhood. I have yet to hear Government Members say that they are not in favour of it, but I have yet to see a fully meaningful policy from the Government on research, and the Government should have one. We can go right back to 1970 and the Senate report. Nothing has happened. Let me say to the Government of Canada, for the sake of the youth of this country, for the sake of the unemployed, for the standard of living for our children, get on with it and let us get the money going in research in the amounts that are needed.


Arthur Allister MacBain: Mr. Speaker, I think we all appreciate the motion put forward for discussion today by the Hon. Member for Scarborough East (Mr. Gilchrist). It is a timely topic and it is one we must address. I enjoyed the remarks made by the Hon. Member for Scarborough East. I also enjoyed hearing from the Hon. Member for North Vancouver-Burnaby (Mr. Cook) who has just addressed the House, as well as many others.
I want to mention a very small program of the Government of Canada and pay tribute to it. It is one of the smallest in the area of research and development. However, there has been some discussion as to whether or not it will be continued. I hope it will. The program is known as the New Crop Development Fund. I believe the total amount committed to that program is only three-quarters of a million dollars. Speaking only for my area with regard to this fund and the research and development permitted under it, the farmers and those producers of goods in the agricultural sector appreciate this program very much.
I noticed in a booklet entitled "The Government of Canada's Investment in Science" a very interesting opening remark. It reads:
Research and development (R and D) and industrial innovation are key elements in the federal government's policies and strategies to meet the economic challenges of the future.
I read that because I like the connection between research and development and industrial innovation. I think that is a
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very important point and it is a linkage that is very often missed. There is a danger, as was found in the United States, that when a tremendous amount of money is put into research and development, the next step, commercialization, does not happen. It does not happen because sometimes we fail to appreciate and make possible the movement from R and D to commercialization. It is one thing to permit, in one way or another, the funds for R and D to be made available, but after the research and development is done, before the product or the technology is on the commercial market, a big gap occurs. The authorities in the United States feel that it takes eight years to move an innovative venture, that is, the product or the technology, from the completion of research and development to profitable commercialization. Those same authorities state that it takes 12 years for a company in a normal or average case to make the same return on investment from an innovative new venture, when you compare that venture with a mature one.
When you look at a period of eight years before a product becomes profitable and a 12 year period before it brings a return on your investment, Mr. Speaker, you realize the importance of the time frame. Small companies cannot overcome this obstacle. I say to the Hon. Member for Scarborough East that, as well as having a research and development policy or strategy, we must also take a look at the next step, that is, what happens between the time when R and D is carried out and the time when a company makes a return on the investment on the product or technology.
I am aware of the fact that the statistics I have just quoted are American, but I think they are so basic that they cannot be much different in Canada, that is to say, that it takes eight years to start turning a profit in the average case taken from a study of 68 industries involved in the innovative ventures, and 12 years to return the investment.
When we, as Members of Parliament, are considering research and development, we must realize that there is an important linkage between R and D and the commercialization of a product. Unless research and development is given assistance to make such projects profitable, it is unlikely that the millions and billions of dollars to be poured into research and development will be of any great benefit.
1 personally believe that in order to have a meaningful research and development program, there must be a national industrial strategy in place. I appreciate the fact that the Hon. Member for Scarborough East was not attempting to put one ahead of the other, but I suggest that we need a comprehensive and long-term industrial strategy for Canada, part of which would be a research and development policy. I think this is extremely important.
I had the opportunity to present a submission on an industrial strategy for Canada before the Macdonald Commission. I suggested that the Commission make a preliminary report to the Government of Canada asking it not to wait for the economic report from the Macdonald Commission but to set
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up a group consisting of businessmen, labour leaders, university people and members from the federal and provincial Governments to prepare an industrial strategy for Canada. This group should also receive information about the state of affairs outside of Canada since 30 per cent of our industrial output is exported.
As I pointed out in my letter to the Macdonald Commission, I do not believe that an industrial strategy for Canada can be prepared within the House of Commons, regardless of which Party is in power, if we depend upon the resources available to a government or its Departments. I say this because Ministers of the Crown and their senior advisers already have a very heavy daily administrative burden. I am sure all Members agree that backbenchers are very busy, and surely Ministers are extremely busy running their Departments. We should not wait for an industrial strategy to be developed in the House because it will not happen.
An industrial strategy is essential for the future well-being of this country. This industrial strategy should be developed outside of the House. There are retired businessmen, retired labour leaders, university people and bankers as well as consulting firms who have a great knowledge to contribute in the formation of an industrial strategy. A strong team must be formed that can give us a comprehensive industrial strategy, which will include a system for research and development and the commercialization of the fruits of that research and development as one of its goals.
1 pointed out to the Commission that during wartime we adopted a dollar a year idea. I think that we are in position where the economy of this country and the western world is such that we could adopt a warlike innovative action which would be justifiable and acceptable if it resulted in an industrial strategy for Canada. I have learned from major industrial concerns that this is their position. They are prepared to make their top company personnel available to contribute to this industrial strategy since it is their belief that it would be very good for the bottom line of their companies to have a longterm industrial strategy for Canada. However, they would not consider this if it is not connected to the bottom line of their financial sheet.
As I said, I have asked the Macdonald Commission to make a preliminary report such as I have suggested. If that report is delivered, I believe Members would support the Government in setting up a group to form a comprehensive industrial strategy. While it would be best to wait for a report from the Macdonald Commission on an industrial strategy, I do not believe that we can afford the luxury of waiting for it. 1 might say that this is also the opinion of industrial leaders whom I have consulted.
It is not uncommon to hear after-dinner speakers tell their audiences that the day of the smokestack industry in Canada is gone. They will go on to say that the day of the textile industry in Canada is gone, the shoe industry has disappeared, and some go as far as to say-if not publicly, certainly in private conversation-that the automobile industry will either be unimportant or a thing of the past. These remarks are made by

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some very important people in governments, industry and education. Responsible people have tried to justify these statements on the basis that a third wave of high-tech industries will employ young Canadians and remove the need for those industries which I have mentioned. When this is said without any in depth study or industrial strategy to back it up, it may result in our having to pay a heavy price in the future for those remarks.
A Member from the New Democratic Party said earlier this morning that there is no concrete evidence available that third wave industries will be of such great strength or have such a large number of employees that they will take the place of the older industries that have been part of the industrial revolution in Canada. I agree with that statement. 1 am sorry that he is not in the House this afternoon, but I am sure that he will read it in Hansard. What 1 am saying is that when we make statements like that, when speaking to our constituents or in the House, before we know what we are talking about and before we know what the future holds, we are doing a disservice to this country. That is not to say that the third wave industries will not be helpful and beneficial to this country and a boon to our young people. However, I am saying that 1 have no evidence that one type of industry will be a complete substitute for the other. If we move in that direction without knowing what we are really doing, we will in all likelihood lay a false foundation for the industrial future of this country, and I, for one, will not participate in the movement in this direction.
I hope that when the opportunity arises, Hon. Members from all sides will support the idea of an out-House industrial strategy being prepared for Canada, because I do not think we will see it unless it is done that way. It can be done under the direction of the Government of the day, the Government of which I am honoured to be a Member at this time. However, it must be very broadly based, along the lines that I suggested. That does not mean that Government Ministers, Deputy Ministers and senior experts in various fields cannot be assigned to this group to ensure that part of the expertise found in the elected or appointed people in Government is fully utilized. They do have a real contribution to make. Ministers have a great deal to offer in the experience they have gained in running large Departments. This is true of Deputy Ministers and various experts in the Departments as well.
As I see it, however, the real expertise for an industrial strategy in Canada must come from those in the private sector to a very large extent. They are the ones who know how to run the country, not Government Ministers, Deputy Ministers or experts in a tiny field in a Department who are qualified to advise a Minister or Deputy Minister on a small issue. When it comes to an issue involving an industrial strategy for Canada well into the twenty-first century, it requires the expertise which we do not have here.
Speaking before the Macdonald Commission, I stated my opinion that not all expertise may be found in Canada itself. We depend on the international market for our sales, and there would be nothing wrong if some of the people we retained to help this group came from some of the countries that take large amounts of our exports.


James Gordon Gilchrist: I would like to thank the Hon. Member for Niagara Falls for his very serious presentation. I hope he will not mind if I just give him one little jibe over his terminology. I was not too sure what he meant by an "out-House industrial policy". I sort of thought that that is perhaps what we already had. Seriously, I did want to ask him about his concern over the strategy of the Government not embracing the textile or the shoe, or the other "low technology" industries, although it is not really fair to call them "low technology". I remind him that the Minister stated that "it is in these high technologyintensive sectors, and I believe in these sectors alone, that new challenging and high-paying jobs can be created". I am wondering if the Hon. Member for Niagara Falls does not support that view. Will he attempt to convince the Minister that perhaps in areas other than the advancing technologies we should be supporting business?


Arthur Allister MacBain: Mr. Speaker, I appreciate the question. I would like to mention that I think I deserve the jibe that the Hon. Member has given me. Being a farmer's son, I should have been more careful. The phrase "in-House" is now such a part of my vocabulary that I forgot about my past, and 1 should never do that.
I would say that my view is not necessarily ad idem with the statement of the Minister which the Hon. Member for Scarborough East has quoted. I am trying to be fair. I know there is a place in Canada for high-tech. It is obvious. However, 1 am afraid that in our rush to get the high-tech, we are forgetting about the bread and butter industries of the past, and that is what I am against. It may be that when a comprehensive industrial strategy is prepared in the manner I have suggested to the House this afternoon, I will be proven wrong, and that we could move in the direction as stated by the Minister of the Government. However, 1 am certainly not prepared to accept that statement at this time without the in-depth study which I see as being required. I hope that this answer is helpful.


Ian Gardiner Waddell: I would like to make a comment and direct a question to the Hon. Member whose speech I very much enjoyed. I liked his use of the term "out-House strategy". It opens up lots of possibilities. We could have Eaton's to catalogue it, for example, we could have the former Alberta Cabinet Minister, Mr. Horst Schmid, to testify about it, and so on. The possibilities are simply endless. My colleagues also have some comments, but they are probably not permitted in Hansard.
The term "industrial strategy" is not a new one. The present Prime Minister (Mr. Trudeau), has used the term, as did his great friend, John Turner, when he was Minister of Finance.

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As Don McGillivray, the journalist, said last week, "all God's children" have used the term "industrial strategy".


Jean-Luc Pepin: All Ministers of Industry, for sure.


Ian Gardiner Waddell: But what does it really mean? 1 would like to direct two questions to the Parliamentary Secretary, who I think is one of the most thoughtful Members of this House. I might say that I agree with what he has said about moving too quickly in high-tech without thinking about it. I think he is right-on there. However, has the Parliamentary Secretary given any thought to the use of another term for industrial strategy, something else we could call it which would better reflect the process? Second, how does he see labour's involvement in the process? He spoke of business being a big part of the industrial strategy. How does he view labour's participation in the new industrial age or in the process of forming an industrial strategy?


Arthur Allister MacBain: Mr. Speaker, I will not attempt to explain what I envisage an industrial strategy as being, because if I went into that subject, I think it would take away from what I expect the group to do, because even defining it will not be easy. I was using the term today in the way it is normally used.
I am interested in the Hon. Member's question as it pertains to labour. I was speaking without notes and I meant to say "labour, business, university personnel and others". I will check the "blues", and it may be that I did not make that point as strongly as 1 had intended. If I did not do so, I do so now. I point out that on Tuesday of this week, I appeared on a TV show with Mr. Cliff Pilkie of the Ontario Federation of Labour. We discussed this very point. We were in agreement on the basic idea of an industrial strategy somewhat along the lines I have suggested today. Certainly the idea was put forward that labour would play a very important part in the preparation of that strategy. This is not to say that Mr. Pilkie did not say there would be difficulties in getting the three together in an industrial strategy for Canada. There was no suggestion at all that it would not work. It was my first opportunity to meet Mr. Pilkie, which probably explains why I may not be as close to labour as I should be. In any event, I enjoyed meeting him. After the show was over, my guess was that labour was just as interested as business and Government in getting together to lay down a foundation for the future economic development of the country.


Gary Michael Gurbin: Mr. Speaker, I am very pleased to participate in the debate precipitated by the motion which in part reads:
That this House recognizes that an increased commitment to science and technology is fundamental to the establishment of a new industrial base in Canada, to the rejuvenation of existing industries, to the creation of new employment and the maintenance of existing jobs, and to economic recovery-
Perhaps some of the most important inadequacies of the Liberal Government, which we can understand best in terms of current economic conditions, were described in the December issue of "Economic Outlook". It gave the figures which OECD provided, comparing Canada with the other OECD countries.
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Three parameters were used which I think provided us with a context with which to compare Canada and the other nations in terms of how we were really doing. The first parameter was ranking in terms of economic growth. Canada ranked twenty-fourth out of 24. I could go through the list. It included Australia, Austria, Belgium, Turkey, Portugal, Luxembourg, etc.
The second parameter was that in the top seven OECD countries we had the second worst record in unemployment levels. Again this provided us with a comparison to use. It compared Canada with other industrialized nations, and we were second last in the seven with which we most like to compare ourselves.
The third parameter was industrial productivity. This is the one to which we should pay the most attention. The years that were used were from 1960 to 1973 and then from 1974 to 1980. In looking at those years, we find that Canada is the only country which had a negative growth in its productivity. If we look at our productivity, unemployment and economic growth, although we are well able to appreciate that there is a world-wide recession and economic problems, and compare ourselves on the basis of the available figures, we see that we are not doing as well as most other countries or as well as we have a right to expect. These figures should hurt our pride and should cause very serious concern for our future.
Science and technology is the focus of the debate in the House today. Canada's economy, the health and integrity of the country now and in years to come, are the issues which we are trying to address. The low historical levels of R and D funding in Canada are well known. The 1.2 per cent of the GNP we hope to achieve this year is a start toward the goal and commitment of the Government of 1.5 per cent of GNP. Perhaps the figure should be 2.5 per cent instead of 1.5 per cent. At least the goal toward which we are aiming is one we can all support, at least until we attain it. We know that for every 1 per cent of the Gross National Product invested in R and D we obtain approximately 800,000 jobs. That $3 billion of investment or 1 per cent of our GNP translates directly into 800,000 jobs, according to the figures of the National Research Council. Thus we see that R and D translates into jobs-full-time, long-term employment for Canadians.
It would be easy to point critical fingers at a number of R and D related activities and not to say enough in any number of areas, but I would like to focus on two energy areas in my time today. I would like to deal very specifically with the way they represent Canadian opportunities for economic gain, employment, and serving a mixture of Canadian energy needs. The first energy type upon which I would like to concentrate is solar. Basically I want to concentrate upon active solar, while in passing give full respect to passive solar and photovoltaics.
Historically, the cumulative total R and D and solar specific program to the end of fiscal year 1983 will be $97.6 million, with about one half of it dedicated to R and D. At the end of March of this year the funding is due to stop and there is no commitment on the part of the Government to carry on with

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additional funding. Cabinet is now faced with interpreting a substantial review of the status of the solar energy industry in Canada and with making a decision on the course of Government action.
What have R and D and the Canadian industry done to date with solar? The industry is ready. It can provide domestic hot water systems which are competitive with current alternatives. They would cost approximately $300 per gigajoule per year. There are other hot water applications in both industrial and recreational areas that are very cost effective. The fruits of years of funding and effort have given the Canadian industry the right to export 25 per cent of its production to date in a world market that has a $10 billion potential by 1990. It is a fast-growing market. It has been well documented that the potential is there.
Active solar has taken off in the past few years, and the sequence of a starting industry flowing to commercialization and markets while maintaining R and D is the question facing Cabinet today. The Science Council of Canada suggested that the Government should back winners. There are a publication which attempted to single out the industries that should be backed or supported. What we really need to consider in this single, very focused area of energy is that if we make a commitment of $175 million over the next five years, we could potentially create 50,000 permanent jobs. Also we could potentially displace 200 million barrels of imported oil. It is not simply a question of dumping more money into research. We should follow it one step further to see how we can support research which has already been done and how to continue on with research that is necessary and appropriate for the Government to conduct. We should ensure that the research we have already supported becomes something of which we can take advantage. This is the decision with which the Government is faced.
It brings into focus a number of questions. First there is the question of initiating and supporting the correct R and D initiatives. There is also the question of providing the environment for industry to grow through investment. Finally, there is the question of providing, where necessary, assistance to market penetration and industry self-sufficiency. A $175 million commitment over the next five years would in fact provide all these things to that industry. Also it would provide, as I said, long-term, permanent Canadian jobs and permanent Canadian energy opportunities.
If the Cabinet had decided to stop further support in this fledgling solar industry, it would have committed a good deal of the previous R and D activity to failure and net loss. It makes no sense. Although the question is in part a short-term political one because a number of options are available in Canada, the decision will be most correct if we make reasonable use of the technologies that match our needs. I urge the Minister of State for Economic Development and Minister of State for Science and Technology (Mr. Johnston), although he is not in the House at the present time, to convince his Cabinet colleagues that this would be the correct decision to make and it makes ultimate sense for Cabinet to continue to support it
until the industry has the market penetration it needs to provide the ability to survive without additional Government support.
The second type of energy I would like to specifically focus on is nuclear energy. For the purists, one could say I was talking about a form of nuclear energy when I was talking about solar, but to stick to convention, I will talk about nuclear energy per se. I would like to talk about nuclear energy and the R and D we have in Canada now. I would like to focus particularly in that area on using uranium for heat.
I would like to recognize the historical excellence of Canadians in this technology, including those such as Dr. Green and Dr. Rummery at the Whiteshell Nuclear Research Establishment. Indeed, the work done at this facility can have an impact on the Canadian and world energy scene out of all proportion to the size of this facility.
Whiteshell is responsible for our waste management program and for nuclear products. It is clearly onstream with realistic solutions. We seem likely to be world leaders in this program. Whiteshell is also responsible for the organically-cooled experimental reactor which gives temperatures considerably higher than the standard Candu reactors and which has economic application to removing the oil from oilsands with little disturbance to the terrain, the so-called removal in situ. The literally thousands of direct and indirect jobs, the additional fossil energy security that could be gained and the very efficient marrying of uranium with the oil sands are obvious gains for Canada.
The use of steam for heavy-water production is the best current example of using primary heat from uranium for heat itself rather than for generating electricity. Indeed, the additional capacity that is inherent in just the Bruce nuclear power development is capable of producing energy for industry at prices attractive enough today to create 10,000 new jobs, permanent industrial and agricultural jobs by the year 2000. My point in mentioning both the solar industry and the nuclear industry was really the same. Both represent valuable Canadian options, both have seen significant Canadian R and D content and both are at a critical threshold in many ways. There are obvious differences between them, but the real problem faced by both is the need for the correct political decisions, and soon.
We have all too often missed the boat. Today we see the trouble our automobile industry is in. Yesterday we lost the television industry. In the case of science and technology today in the federal House we have an integration with economic policy. The Hon. Member for Scarborough East (Mr. Gilchrist) has given recognition to the importance of that. We all hope that will help facilitate some of the important decisions that are necessary. That is appropriate. It seems to be a part of the models which have worked well for other countries.
Where we go with our technology options, how we integrate into the marketplace, into an industrial strategy, if you like, is really the key. It is the essence of our situation in Canada
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today and part of the way that we can regenerate ourselves, even to the point where we can look at these long-term strategies and make them work.
1 have suggested two political decisions which can be made today, which need to be made and require the intelligent cooperation of Government with the science community and with industry. They are practical, realistic and provide a part of the background for working out the longer term industrial, technological, economic and employment strategies.


John Leslie Evans: Mr. Speaker, it gives me a great deal of pleasure to speak on this motion today. The Hon. Member for Scarborough East (Mr. Gilchrist), as I said earlier in a question to him, has done a great deal of work, which is very interesting, and has put forward a great many useful ideas in the area of science and technology over the three years that he has been the critic for the Opposition Party.
I commend him for putting forward this motion for debate. I might not agree with some of the wording of the motion, but I certainly commend him for bringing this to the House for debate today. It is probably the most critical area that we could and should be looking at as a Government and as a country. If we do not become more engaged in the area of research and development, in the development of new technology and in the development of the ways of the future, as a country we will be left further and further behind in the areas of economic growth, job creation and all of the things that we want for this country which give rise to increases in our standard of living. Without such increases, we will certainly have social unrest and a very difficult time expanding or even maintaining the level of social expenditure now enjoyed in this country. That will certainly be a divisive debate if and when that should ever have to be entered into by Members of this House.
The framework put forward by the Hon. Member for Scarborough East was a good one. Earlier I asked him about putting some flesh on the bones, and he did, especially in the area of education, an area where I agree with him. It is not good enough any longer for a nation to simply leave the role of education in the context of its national importance in the hands of one level of Government. There has to be a greater co-operation between levels of Government in the area of education. Certainly national priorities and needs have to be well defined and well funded from a national level of Government.
The problems that we face in the area of research and development stem from five basic areas. First, we have to be funding a much higher level of basic research in this country. Talking about applied research and the adaptation of existing technology is certainly of importance. However, any country that is going to advance technologically, that is going to stay at the forefront and compete effectively with other nations in this world in the new technologies and the technologies of the future will have to be concerned with funding a substantial body of basic and fundamental research.
Second, we have to begin to utilize our existing body of university researchers and non-governmental researchers much
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more effectively than we now do. Third, we have to provide funding for the development of new researchers, which gets us into the education question. We have to expand greatly upon our delivery of scholarships, research grants and post-graduate fellowships to ensure that we have highly trained and qualified manpower which will be necessary in the future, not only to do the research but to train our young people in ever-expanding numbers for the jobs in the technology field.
Fourth, and this is where we start to get into the area of industrial strategy, and I have great difficulty with the notions sometimes put forward about an industrial strategy that calls on Governments to direct. I believe Government should be a facilitator and not a director of what is done in this area. The Government does have, as a facilitator, to provide mechanisms for moving basic research that is done by the universities, the Government research agencies or private research foundations into the marketplace in profitable development.
Finally, the fifth key to a successful strategy is to ensure that adequate management talent is available, not only to administer the research effectively, but to manage effectively the process of product development and promotion that flows from the research and development process that we have.
Canada has serious difficulties in all of these areas. In my opinion we are under-funding basic research. We are not utilizing our existing body of research talent, whether it be at the National Research Council, in the universities, the colleges or the private research foundations. They are being underfunded. They are not being provided with the kinds of funds necessary for release time so as to allow them to do increased amounts of research, and as a result we are under-utilizing the talents available to us now. We do not have an advanced program of aid for young people to promote excellence, to promote a science "meritocracy", if you will, and that has to be improved greatly. We do not have the kind of management training which is required to ensure that our scientists have available to them those who are able to put the process in an effective format.
My other point, Mr. Speaker, is that we do not have, through our tax policy or other areas, an effective mechanism for ensuring that new firms are created in the process of moving basic research out into the marketplace in Canada and throughout the world. Those are the five key areas, I believe, of a sound science policy, of a research and development policy, for this country.
I think it is terribly important that we distinguish between basic and applied research. It is naive to expect that industry will delve heavily into the areas of basic research. Certainly some will, but industry is much more short-term oriented. It is more oriented toward what will provide profitable results for the shareholders over the foreseeable five or ten years. I think it is the role of Government to provide the infrastructure, the research capacity, to look into the truly basic elements of

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research. Governments have done this in the past through the university system, through private foundations and through our own National Research Council. These agencies have been the developers, the doers, of basic research, and the ideas flowing from that have gone into the area of applied research and have led to product development. But there should be a coordinated effort.
1 believe Government has to focus its attention more directly upon the area of basic research. Governments should be concerned with research which has long-term pay-offs, which you could not really expect a private enterprise to be concerned with. It should facilitate the transfer of this new knowledge which has been developed in basic research into the private sector and into other forms or vehicles for developing products. It should facilitate the creation and growth of firms through tax policy, through our grant structures, and so on, to ensure that as new technology, new ideas are developed in the basic fields, they are moved out into practical application. That is the kind of Research which we should include as part of Government, not only the Government research agencies themselves, but also the universities. I would call "Government" all of those areas of research which are currently publicly funded in a direct way, and I would call "private" that which is funded in an indirect way through the tax system, and so on.
It seems to me we have dealt far too long on the basis of trying to force multinational firms to do research in Canada. I believe we probably will have some success in that effort, but the cost of that success is going to be high. I believe it would be far better to spend our time on developing the basic research capacities, developing our own new ideas and facilitating the creation and development of Canadian firms which will carry those ideas into the marketplace. That would be a far more profitable expenditure of our time and effort. We should be planning now for the firms of the future rather than trying to force the mature firms which exist now to do more research in our country, although some of that certainly can be done. Therefore, direct expenditure for basic research and for the training of qualified persons to conduct that research, is the role of the national Government and it should be played to a much greater extent than it is now.
I would suggest, as a scenario, that the National Research Council could be the hub of this entire research endeavour by the Government. We could have a National Research Council which is much expanded. I quite frankly believe that the research budget of the National Research Council should be expanded dramatically beyond what it is. I believe the Council could work in connection with universities. Facilities could be built for research on university campuses, which are unavailable now and will be unavailable in the near term because of the financial constraints at the university and provincial Government levels. They cannot build the facilities which are needed, but the National Research Council could provide them and could then enter into an interchange of people between the university facilities and the National Research Council, to facilitate the exchange of ideas and the development of research. This same type of co-operation and joint venture in
basic research could, of course, take place between the National Research Council, which I would call the "Government" agency, and the universities and private sector research foundations. The role of Government, then, would be to provide facilities, the wherewithal of researchers to undertake basic research, and for graduate training and post-graduate fellowships.
I feel that the key factor is a dramatically increased level of funding. We have heard the Government has put forward 1.5 per cent as its goal. I have said on a number of occasions in the past when the Hon. Member for Scarborough East was in the audience, that I do not think that 1.5 per cent is good enough. I do not think 2.5 per cent is good enough. If we are going to be in the forefront in ten to 15 years, we should be shooting for a 3 per cent goal on research and development funding, not 1.5 per cent. I believe also that we cannot get bogged down on this notion of "who is doing what". While the Government is doing its share, the private sector is not. I feel the Government should set our goal. Perhaps our goal will be 2 per cent of the 3 per cent of the Gross National Product being expended publicly on research and development, and we would expect that the private sector will take up the other 1 per cent. Hopefully, they will do even more. But we are going to set a goal for ourselves publicly and not simply have a situation where we say, "Well, the private sector must increase its expenditures on research and development. We cannot increase ours, because we are already doing more than the private sector." Then it becomes a game of pointing the finger at one another. I believe we have to set an objective for publicly funded basic research in this country, and that, when the new ideas flow, will generate the kind of applied research which is necessary, and that will increase that level of research and development funding.
We must also be very concerned with allowing the development of centres of excellence in this country. I do not think it is wise for us to try to diversify our efforts, whether it be on the basis of the need for job creation, or for any other such need. We should not spread ourselves thinly across the country. From my own personal experience in the research field, and from talking to a great many others, I find that research requires a certain critical mass of people, ideas and funding to be successful. If you try to spread research facilities in one particular area of endeavour widely across the country, that critical mass does not develop and your research does not get off the ground. We have an example of a very successful and dynamic research establishment which is growing right now and that is the high-tech research facilities here in Ottawa. From a purely practical, research-oriented position, I would hate to see the Government undertake programs which would cause firms to locate elsewhere throughout the country and dissipate that critical mass which is now generating millions of dollars, billions of dollars of export, millions and billions of dollars worth of growth in our GNP, the thousands and thousands of jobs in this country, many of which are spread across the country, but not the research function. It seems to me you could put the manufacturing function wherever you
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like, but the research function requires that critical mass, that exchange of ideas between highly qualified individuals, and they should be in the same general location in order to be able to do that.
Now, Mr. Speaker, the second basic area of research is of course applied research. 1 think we will find that being done by most business firms, that is, the application of new ideas to existing problems and moving these ideas forward into the market place. Of course we can encourage this through incentives such as grants, tax incentives, joint ventures to ensure that new ideas are moved forward and proper funding is applied. 1 could see the Government, for example, developing new ideas in the National Research Council and then having a vehicle, such as the Canada Development Corporation, move the idea out, licence it to a private firm and perhaps take back non-voting shares where the dividends on the development and sale of products from this new idea would flow back into this central agency. Those funds would be recycled back into the research process to generate more new ideas, and thereby become a sort of self-feeding cycle of new ideas, transformed into new products, and so on.
Most important, it seems to me, is that any research and development strategy should find the Government acting as the doer for long-term research and a facilitator thereafter. We must not, it seems to me, turn into a centrally dictated, bureaucratically controlled decision-making device in the name of a research and development strategy. The essence of research is creativity and exploration. Bureaucratic structures, of course, are the antithesis of that process. I think this indicates the type of structure, and the five problem areas, that all countries will have with a research and development strategy. This indicates the kind of things 1 think have to be done in the area of applied research to ensure that Canada not only develops new ideas for the future, but has the mechanism to share those ideas with the world through new product development.
Let me reiterate the five areas I mentioned before, Mr. Speaker. First is a much higher level of basic research, and I indicated just how high I thought that should be. Second, to utilize the existing body of researchers at the National Research Council, universities and private research foundations much more effectively than we are doing now. Third, to provide the kind of funding necessary to encourage our young people to go into areas of high-technology in our universities and colleges. The last two, of course, have to do with moving research out into the market place. The first 1 mentioned was to provide a mechanism of various sorts for moving basic research into profitable development. The profits should be shared by a national research funding agency to help fund the level of basic research we want. Finally, also at the university and other levels, we have to ensure we have the funding available to provide the necessary levels of qualified management personnel because, if anything, we have found from experience in the high-tech field that one of the things holding back high-tech development from moving even faster than it is now is the lack of qualified management personnel. We need
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people who understand technology and who are also able to put the ideas together with good management practices and create highly competitive world class firms.
Having said that, Mr. Speaker, I thank the Hon. Member for Scarborough East for bringing this matter before the House, and 1 hope I have inspired some thought on the issue he has raised.


Gary Michael Gurbin: Mr. Speaker, I would like to express my appreciation to the Hon. Member for Ottawa Centre (Mr. Evans) for his candid remarks. One basic problem I have in listening to him is that, in the full realization of the unemployment problems and economic stress we have today, the real question is, how do we survive next month and next year, never mind ten years down the road?
I found his response intelligent, certainly he made some good points, but it is sort of an academic approach to the real problems today. So I would like to ask him, what specific things would he do to solve the problems today, integrating research and development today, making things happen today and tomorrow? While what he has outlined is good, with all respect, I have heard that for the last four years in this House from Members on all sides. I do respect his earnestness in putting it forward so I do not want to detract from that, but what would he do today?


John Leslie Evans: Certainly I do not think our debate today was centred on very pressing problems of unemployment we face. But I should say that 1 hope we are able to develop an integrated strategy where we can deal with the unemployment problems, the short-term unemployment problem in this case, which are terribly serious. But at the same time we should not allow ourselves to not think about how we can move forward in some of the long-term solutions. It seems to me that if we do not follow a strategy, perhaps like the one I have described, or others which may be superior, then we are going to perpetuate and maybe even exacerbate the unemployment problems we have in the future.
I think today Canadians would be willing to say, "All right, you are asking us to tighten our belts but if part of what we are tightening our belts for is to develop a strategy that is going to make the future better, not only for ourselves but for our children and our children's children, then do it". I think we could not only get ourselves moving but we could give Canadians the hope that they are desperately looking for that the future is going to be better than the past. If we simply devote all of our attention to crisis management, dealing with the current problem, it seems to me that we do not give Canadians the hope necessary to overcome the psychological problems of moving into the future.
So it is not just the financial problem we face today in our economic crisis, it is also a psychological problem. Part of the solution to that psychological problem is to give Canadians a vision of where Canada can be in the future, how much better we can make our lives in the future through some strategy to move ourselves forward in the area of science and technology.

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Certainly 1 am talking about things that might not be Government policy at the moment. Certainly they are not at the level of research funding which I am talking about, but I do not think that should restrain Hon. Members in this House from putting forward what we believe is in the national interest.


Mr. Lewycky:: Mr. Speaker, I wonder if the Hon. Member for Ottawa Centre (Mr. Evans) would clarify a point which seemed to be rather contradictory. He talked about universities being required to do more research, things like that, and the necessity for more research and development. But then he seems to want to centralize all the research and development in Ottawa-or in one region of the country. The benefit of having research and development in many regions is in that way different problems can be faced. In some regions there are areas of science that are highly developed, whether it be fibre optics in Saskatchewan or the Manitoba telephone system. If people in western constituencies such as mine are not exposed to research and development possibilities, then there is no way they can participate. They would be left out in the cold.
I have a little difficulty reconciling some of the centralization concepts of the Hon. Member for Ottawa Centre and the necessity for research and development all across Canada. I wonder if he could clear this up for me.


John Leslie Evans: Mr. Speaker, 1 would not want to leave that impression with the Hon. Member. Perhaps he misunderstood what I said. I am not talking about centralizing. Certainly the head office of the National Research Council is in Ottawa, but it also has facilities all across the country. I was trying to make the point that there are universities all across the country as well, with research expertise that is being underutilized. One of the reasons for that is that the funds are not available to provide first-rate research facilities for academics and students.
I say that rather than being centralized in Ottawa, the National Research Council could be the vehicle through which funding could be provided to the universities directly, to enable them to build new facilities on a co-operative basis with the National Research Council. Perhaps the facilities could remain in the hands of the National Research Council but be on the university campuses and available for co-operative use by academics, students and National Research Council personnel. They could move from Ottawa to places where there was a critical mass of people doing fibre optics research or to the West to do biomedical research in Alberta or biotechnology research in other parts of the country. The research has to be spread throughout the country.
As far as critical mass is concerned, if a small country such as Canada is going to do research in a particular field, then it should not try artifically to spread the research effort in that particular field broadly throughout the country so that 15 universities would all be trying to get adequate funds for research in a particular area of effort. Rather, we should try to develop centres of excellence across the country-perhaps even several in one field. These should be adequately funded and have the critical mass of people doing work in that area
available to generate new ideas, but the research should be broadly spread across the country.


Jean-Jacques Blais: Mr. Speaker, 1 was very interested in the Hon. Member's speech. He said that a large number of high-tech companies are located in the National capital region involving, 1 think, 2,500 jobs. He tied that particular development in with the introduction of the Government's contracting out policy in the area of research and development. Is he aware that in the last ten years since the policy was introduced, more than 20,000 contracts in the research and development field, totalling almost $1 billion, have been let? If he is aware of that, could he tell us how that has, in part, accomplished that which he seeks to accomplish and that is, the transfer of research and development activities and technology into the private sector? I know he is aware of some of those facts but 1 should like him to comment on the experience of the last ten years and tel! us how we can build upon that experience and allocate funding in the future.


John Leslie Evans: Mr. Speaker, the Minister's point is appropriate and it is correct. Ottawa and the high-tech industry in Ottawa have benefited greatly from the Government's program of contracting out. Northern Telecom, Bell Northern Research and the myriad of small firms that have sprung up from the research arm of Northern Telecom primarily, have created hundreds of new jobs. That is the kind of critical mass I was talking about. With that critical mass of basic research, new ideas spring up. From that we not only get new firms that create thousands of jobs but we also get an interchange of activity and of minds which leads to further new ideas. I think of Mitel, Gandalf, Nabu and all the corporations that have sprung up in Ottawa over the years. The Minister said 2,500 jobs had been created; on the contrary, 25,000 jobs have been created. We expect that within the next five years that number could be tripled and several hundred small firms could spring up.
The spin-off is spreading throughout the country. Mitel now has plants in New Brunswick, so the benefits are showing. I would not argue with the Minister that the Government has played a key role in this, but I would say that it should provide us with the example of what could be done if we were to fund these activities at much higher levels than is being done at present.


Walter David Baker: Mr. Speaker, I am pleased to join in the debate for a few moments. I understand another Hon. Member wishes to speak so I undertake to leave some time for him.
I am honoured to participate in debate on the motion brought by the Hon. Member for Scarborough East (Mr. Gilchrist). My knowledge of and admiration for the Hon. Member goes back a long, long way. I spoke at his nomination meeting the first time he was nominated to run for Parliament and for this Party. I hope that Members on the other side of the House will forgive me for mentioning that.
What struck me about his speech that night is exactly what struck me about his speech today. He took a very constructive approach to a very important subject, the importance of research and development and of high-technology and of
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technology generally to the industrial and social well-being of Canada. I have talked to him about this many times and I do not think any Member of the House exceeds his specific and general knowledge on this very important subject. I am pleased to speak for a few moments on this matter.
I hope the House understands that we live in the midst of one of the largest research areas in the world. The Hon. Member for Ottawa Centre (Mr. Evans) spoke about the development of companies like Mitel in Kanata and Northern Telecom in Nepean, but a myriad of small companies are involved in research as well.
Mitel began in a basement, with a dream. It has grown into a revolutionary industry which has, revolutionized other industries. That is the history of the high-technology industry. These companies are involved all the time in the application of theories and the applied research that is necessary. The amount of capital required to pursue this research is astronomical, and the chances taken by these innovators are frightening to the bravest among us. In addition, people sometimes seem to forget the two other components of research in this City, namely, the University of Ottawa and Carleton University. Perhaps the unsung heroes of it all are the hundreds of research scientists employed by the federal Government.
This is a centre of research and development unique in the country, perhaps even in the world. I think that we should remember the importance of it and the significance it can have for the future of the country.
Many of the things that are being dealt with here are important to the Mitels and the Telecoms in their own business and in the products they sell, but the theories the techniques, the chips which go into the robots and the other technological devices are the keystones, I believe, to the redevelopment of other industries, the mature industries which are now having to come to terms with themselves in their place as manufacturers and job creators.
The Government, therefore, has an obligation to this new industry. It will be said to me, "We will take grants everywhere", but grants are uncertain things and research is longterm. All these industries ask for is a reasonable set of tax incentives to pry out of the socks, the storage places, the safety deposit boxes and the banks of Canada the investment capital for them to carry on.
We are coming up to a budget in a little while. If there is one area where jobs can be created almost immediately, where new product development can be spurred, its pace doubled, it is in the area of high tech. Advanced high technology industries have a potential to create 500,000 jobs by 1990. That is why I think it borders on the immoral to have a situation develop where the President of the National Research Council needs to say, as he did, that if Canada had listened to its scientists a decade ago and spent more on research and development, the
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country would not be in the economic mess it is today. That is the truth.
We are not just keeping up with the Joneses, the Japanese or the Germans, or anyone else; in some area we are trying to play catch up.
In the last few seconds that I have left let me say to Members that if any Member on the other side of the House has any influence on the Minister of Finance (Mr. Lalonde), let him please put his influence there. We talk about unemployment. It is likely that the beginning of hope for the long-term future for those who are unemployed and for those who will come after them is not just in the high-tech industries but in the other industries as well.


Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I want to say a few words and to commend Members for the very positive debate we have had. I would like to commend the mover of the motion who placed it on the Order Paper. Since I have only about four or five minutes, I want to come directly to the point and suggest that what this House should be doing is to establish a committee of the House to study the social and economic impact of technological change. That might be a way to bring some fruition to all of the ideas that we have spoken about today. As legislators we might have some input into what kind of society and vision we have for this country. I think we all recognize that advanced technology is here. We are experiencing some tremendous technological restructuring throughout the world. We cannot turn back the clock. We cannot close our eyes to what is happening. It is here and it is happening now and it will continue in the future.
Really what we have to do is to ask ourselves a couple of questions. At what pace do we want to have that change brought into Canada? On what kind of industries do we want to concentrate? How will it affect human beings? Will we have a society in the future making these machines and computers to be the slaves of mankind, as someone said, rather than human beings becoming the slaves of the computer? Will we have the kind of society where we control the robots, or will the robots control us? For those kinds of reasons I think it is important that we go to all three House leaders and ask for a committee of this House to be set up to look into the social and economic impact of technological change.
When I look around the world I see a tremendous revolution taking place. There is a tremendous recession in the world. Part of the reason for that recession is to be found in the result of technological change. I am not sure whether any country or political Party has found the solution to which way we should be going. Certainly no political Party has found all the solutions. We have had many different attempts. We find, for example, that the more mature industries that we have known in the past, such as steel, auto, rubber and glass, will not be the industries of the future in terms of providing many jobs and many workers. Even if we have a world running at full capacity and we are over the recession, technological change will make it so that these industries will never employ the number

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of people they employed in the past. I am not saying that these industries are obsolete. 1 am saying that while the technologies we knew in the past are obsolete, the industries are not obsolete. We will have to keep many of these more mature industries, but we will have to make sure that we have the most modern technology so that they do not disappear, that they are internationally competitive and we can export around the world as well as supply our own market.
On September 25, I had the chance to speak in Chicago to a convention of the United Auto Workers of America. Those people are most concerned about the unemployed in their industry. From their studies they told me that by the year 2000 even if the Americans regain their full share of the auto industry, from the Japanese and the Europeans, about 80 per cent of the jobs they knew in 1980 will have disappeared because of advanced technology, the robots and the fully automated factories. The Japanese now have factories that are 98 per cent robotized. These are questions that we will have to look at as Parliamentarians. We will have to find solutions to these questions. If we do not, we will have more and more people unemployed, disillusioned and turned off by this failure of leadership in the country. That is why 1 argue very strongly that a committee be set up.
About two weeks ago, an American economist named Thurow appeared before a policy convention of the Liberal Party of Ontario. He said that what we lack in this country is a vision or a dream of where we are going as a society. We do not have that economic strategy or policy. He said that the Austrians have an objective, even though that country is situated right next door to such a powerful country as Germany. The Austrians' objective is to be better and richer than the Germans. The Austrians have met that challenge. They have succeeded. I think we in this country can learn from
countries such as Austria, Scandinavia, France, West Germany and Japan.
In closing I urge Members of all three Parties in this House to approach their House leaders and try to get a committee going very soon, because we are lagging behind in this country in the field of advanced technology.


Walter David Baker: Mr. Speaker, if I may interject, I am intrigued by the thought of a special committee of the House of Commons, the idea of setting up a kind of task force which was put forward by the Hon. Member for York-ton-Melville (Mr. Nystrom). Would the hon. gentleman be in favour, as well as establishing such a task force, of restructuring the Standing Committees of the House of Commons so that a standing committee of the House of Commons might be struck to deal with matters on an ongoing basis beyond the task force, having regard to the fact that we have come to the day when we must specialize in our committee structure?


Lorne Edmund Nystrom: The simple answer to that is yes. I think the Member for Nepean-Carleton (Mr. Baker) is absolutely right. I would support any move in that direction and I would appeal to all Members of the House to support that suggestion also.


The Acting Speaker (Mr. Corbin):: Order, please. It being 5 p.m., it is my duty to inform the House that in accordance with Standing Order 62(11), the proceedings on the Motion have expired. Accordingly, the House stands adjourned until Monday at 11 a.m., pursuant to Standing Order 2(1).
At 5 p.m., the House adjourned, without question put, pursuant to Standing Order.

Monday, February 7, 1983