1984-01-19

GOVERNMENT ORDERS


Hon. Perrin Beatty (Wellington-Dufferin-Simcoe) moved:: That this House condemns the Government for its contempt for the taxpayers of Canada, which it demonstrates by the creation of a taxation system in the form of the Income Tax Act that is increasingly incomprehensible for individual taxpayers and, by its failure to end capricious and unfair practices of the Department of National Revenue.
He said: Mr. Speaker, as we begin this extraordinary day in which Members of Parliament from all sides of the House will have the opportunity to debate the issue of the Government's handling of the Department of National Revenue, 1 want to start with a quotation which 1 think perhaps should set the tone for the debate today. It explains fully what our responsibilities are in a democratic and free society when authority is abused by the state and its ordinary citizens and its Members of Parliament find that abuses have taken place. The quotation is this:
It follows that when authority in any form bullies a man unfairly, all other men are guilty; for it is their tacit assent that allows authority to commit the abuse. If they withdrew their consent, authority would collapse.
That quotation is from a book published by the Toronto Oxford University Press in 1970 called "Approaches to Politics". Its author is Mr. Pierre Elliott Trudeau, the present Prime Minister of Canada. In that quotation the Prime Minister succintly outlined the approach that should be taken by all Members of Parliament when they find abuses of authority have taken place.
In the course of the past several days we have found that there is an agency in Canada which has extraordinary powers that no other agency has. This agency has the power to seize people's personal records, to invade their privacy, to damage their reputations in the community, to empty their bank account and to confiscate their pay cheques.
What is this agency, Mr. Speaker? It is not the police. It is not the new civilian security agency. It is the Department of National Revenue. This one Department has been given sweeping powers under the law which no other agency, no
other individual in society has, and which impact upon the civil liberties of every single Canadian.
First, the powers granted to this agency are far too broad at the outset. Second, what we have found, in documented case after documented case, is that the Department has taken authority unto itself and has abused the grant of authority given to it by Parliament. It has abused it to invade the privacy of ordinary Canadians. It has abused it to affect a person's ability to earn a living. It has abused it to take away basic civil liberty. We found as well, as a result of a succession of cases which have been made public both in the press and on the floor of the House of Commons, that we have a Minister of the Crown responsible for this Department who is neither aware of what has been done by his officials nor does he care about
In our system of government, our system of parliamentary responsible government, we have Ministers of the Crown who are accountable in the House of Commons precisely to ensure that Departments are held to account and that the authority granted to the Crown is properly used and not abused; that the civil rights of ordinary Canadians are respected by the state and that the rights of ordinary people, the unemployed, farmers, small business people, employees, senior citizens, are not abused; that people are treated with decency, with respect, with dignity and with compassion. Yet what we have found, Mr. Speaker, is that in instance after instance this Minister has allowed or encouraged his Department to treat ordinary Canadians in a way that is simply intolerable in a free society.
What Members on this side of the House have been attempting to do over the course of the last several months, and what the point of this debate is today, is either to force the Minister to accept his responsibility to the people of Canada or to force the Prime Minister of Canada to find a new Minister who is prepared to do the job.
There is an essential question here. Is the Minister of National Revenue (Mr. Bussieres) the Department's spokesman to the public, their apologist when things go wrong? Or is he the public's representative to the Department, the ombudsman when injustices take place, the guardian of the rights of ordinary Canadians? We believe that is the role the Minister should be playing. Instead, we have found that the Minister has simply been a defender of the Department at all costs, often giving false information, information that he subsequently learned was wrong and had to correct. In all innocence he would give this information because he simply did not have the facts.

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[DOT] (mo)
That in itself is an indictment of the Minister's management of the Department. He is simply uninformed about what has been happening in his Department. More serious than that in the course of Question Period in recent days, is the Minister's abject refusal to get the truth and make it available to the Canadian people and the Parliament of Canada.
Over the course of several weeks, the Hon. Member for Cambridge (Mr. Speyer) and other colleagues on this side of the House have raised the issue of quotas that have been put in place in several district tax offices across the country, where tax assessors are being driven to maximize their take and to squeeze every last cent out of ordinary taxpayers irrespective of whether the money is in fact owed.
What happened when this was raised in the House of Commons? The first thing that happened was that every chartered accountancy firm in the City of Cambridge wrote to my colleague from Cambridge and said that they believed there was a quota system in place in the Kitchener district tax office. The Hon. Member for Cambridge quite properly raised that on the floor of the House of Commons and asked the Minister to reply.
What did the Minister say? He said that there were no such quotas. What did we learn later after the Minister had been informed that in fact quotas existed, a fact which the Minister now concedes? Then the Minister said it was only in Kitchener, that it was an isolated incident, that it did not take place anywhere else in the country, and that it was simply the one office in Kitchener where the officials got carried away. He said he had put a stop to this. Further, he said that to end these non-existent quotas which were not in place anywhere else in the country, he was sending out a directive to all district tax offices telling them that the practice was not to be permitted.
What did we learn after the Minister made the statement that it was only in Kitchener? We then learned that there were quotas in place in Toronto, a fact which has been conceded by the director of the district tax office, a fact which has been proven by documentary evidence, a fact which the Minister himself still refuses to concede to the House of Commons notwithstanding the documentary evidence presented to him. The Director General of Taxation has pointed out that in fact quotas have been in place in a number of offices. We have documentary evidence proving that in the case of the Calgary district tax office quotas have been in place there. Occasion after occasion we have had a continuing cover-up on the part of the Minister and of the Department attempting to withhold from Canadians the truth, and a willingness on the part of the Minister to leave information which he knows to be false on the record. Canadians deserve better than that.
I think it is a fair question to ask the Minister why he issued a directive to all district tax offices saying that there were to be no quotas, that they were wrong and that under no circumstances were district tax offices to have quotas. Why has he repeatedly said, both to the press and in the House of Commons, that he is opposed to quotas and will do everything he
can to ensure that they are stopped? If quotas are innocuous, if they have not damaged the rights of Canadians and if they have not damaged the position of the assessors themselves and treated them unfairly, why would the Minister be this concerned and take this extraordinary action to put a stop to them and insist to the House that no quotas would be permitted under his administration?
The answer is that the Minister accepts that in fact quotas are dangerous, that they take away people's rights, that they are unjust both to the assessors who are forced to wring money out of people whether or not it is owed, and that they are unjust as well to ordinary Canadians who find that they are unfairly reassessed as a result of quotas being in place. It is unjust for an assessor to be told that if he wants to get ahead, get promoted, get a merit increase or even hang on to his job, he has to meet some arbitrary quotas set by the officials over him. The Minister believes that is wrong, and we agree.
A second question arises: If the Minister feels that people's civil rights are invaded by the imposition of quotas, why does he not agree that Canadians who have had their rights affected by these quotas and have been unfairly reassessed as a result of them have the right to know whether or not quotas have been in place in their local district tax offices? Why the cover-up. Why is the Minister not prepared to table in the House of Commons a list of all offices in which quotas have been in place? Indeed, why would the Minister not accept his responsibilities as a Minister and actively and vigorously find out for himself in which offices quotas have been in place to make sure that those whose rights have been affected could seek redress? Any Minister of the Crown who was doing his job and knew that injustices had taken place under his administration would have a responsibility to set the record straight, to tell the truth and do whatever he could to ensure that people's rights were respected and the abuses stopped. Yet this Minister still refuses.
[DOT] (ins)
Under this Minister, we have seen cases of extraordinary actions being taken by the Department. For example, an attempt was made by the Department to ask for the whole of a computerized data base belonging to a municipality. Here again the Minister said he was unaware of this, that it was simply a matter of a local district office overstepping itself, that he could not be expected to know and that he would put a stop to it.
What does this Minister know? What has he been doing? What is the Minister's responsibility to make sure that local offices follow policy and respect the rights of Canadians, including the right to privacy? What has he done to discharge his responsibilities to Parliament and the people of Canada? On the record, he has done nothing. What we have had is abuses of which the Minister was unaware and of which he remains unconcerned.
What about his Liberal colleagues? Members on this side of the House have been deluged for the past year with complaints from our constituents, from pensioners, ordinary people with
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handicaps who find that the Department of National Revenue literally does not want them to be able to stand on their own two feet. If they can, they lose the disability deduction. Small businesses have been forced to close as a result of arbitrary reassessment. Tax collectors have used bully-boy techniques which have denied the rights of ordinary Canadians.
Members on this side could list literally dozens of cases where ordinary Canadians have had their rights abused. What about Members on the other side? Have they not been hearing from their constituents? Do people approach only members in the Opposition because they feel there is no point talking to members of the Government, that Liberal Members will not fight for them? Is it a matter that Liberal Members are indeed aware of this, that their constituents are affected in exactly the same way as ours but they have been incapable of getting the Minister to accept his responsibility to protect the rights of their constituents?
Two members on the Liberal side have spoken out. The Hon. Member for Kitchener (Mr. Lang), who is the Parliamentary Secretary to the President of the Treasury Board, spoke out to say that the Department was wrong, that it was an abuse and that the Minister had to step in to correct the abuse. We give him credit for doing that.
Second, the Hon. Member for Sudbury (Mr. Frith) was in Calgary last week. He was quoted in the Calgary Herald as follows:
Frith said he will ask Revenue Minister Pierre Bussieres to act and will raise the whole issue of government control of tax officials at the next meeting of the Liberal caucus.
That was yesterday.
I think we have to assert the political will on top of the Revenue Canada Department and just say "Back Off', he said.
Was this raised in the Liberal caucus yesterday? Did Liberal Members of Parliament speak up on behalf of their constituents? If so, what action is the Minister of National Revenue prepared to take in response to his colleagues who have been receiving the same complaints we have about abuses of the basic civil rights of Canadians? None? Is he too prideful to admit that he has been wrong, that people's rights have been abused, or is he prepared to correct the situation? That is the issue that is before the House today.
What can we do? What could this Minister do if he were serious about trying to protect the right of Canadians? First, he could strike an independent task force on the powers of Revenue Canada to look at those powers as they affect civil liberties in Canada, and to make recommendations for amendments to the Act under which the Department operates to constrain those powers to ways that respect the rights of Canadians.
Second, he could take a fresh look at the Act which currently states that if you, Mr. Speaker, have your income tax return reassessed, you have a responsibility to pay all the money being demanded by the Department, whether you owe it or not. If you do not do that, the Government has given the Department the right to step in and seize your bank account, or your pay cheque, or to issue third party demands to anyone
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who owes you any money. On those third party demands you will find your social insurance number printed and you will find the amount of money that you are alleged by the Department to owe, without any element of due process. Try repairing your reputation in the community after that.
I had a case that came to my attention over Christmas of a doctor who had third party demands issued on 40 of his patients demanding that they pay directly to the Department money that they owed the doctor. He asks how he can rebuild the doctor-patient relationship and the basis of trust that he needs with his patients. The Department is telling 40 of his patients that he is a crook. All that he is asking for is justice, a chance for his day in court. We are attempting to fight the Government in court but every time we have gone to court the Department has asked for delay. He is at least entitled to his day in court and not have his reputation impugned in this way and his professional relationship with his patients destroyed. The Department got less than $1,000 from these 40 third party demands. Yet the doctor's reputation has been besmirched and his relationship with his patients has been permanently damaged. All he seeks is a chance for his day in court. If it is found that he owes the money, he will pay the money; but he wants a chance for due process of law and the right to be presumed innocent until proven guilty. Surely nothing is more central to our system of justice than that.
There is another thing the Minister could do, Mr. Speaker. He could issue directives to his officials and issue a publication that would go to every taxpayer in Canada, in essence a plain language statement of the rights of the taxpayers of Canada. These are the right to fair treatment; the right to sit down and negotiate with the Department a fair schedule of repayment if the taxpayer has made a mistake; the right to the presumption of innocence until proven guilty; and the right to privacy.


Some Hon. Members:: Hear, hear!


Henry Perrin Beatty: We need a taxpayers' bill of rights in this country that taxpayers could have in their hands that says that the Minister of National Revenue is on their side and that they have a right to be treated fairly. But we cannot even get that from the Minister, Mr. Speaker.
We have a case of abdication of ministerial responsibility on a scale never before seen in this House. We have a Department run amok with extraordinary powers that no other agency or individual within our society has. Those powers are being used and abused to the detriment of ordinary Canadians.
This debate today, Mr. Speaker, is about the need for this Parliament to reassert control over this rogue elephant, the Department of National Revenue, the need for simple fair play and justice, respect for ordinary Canadians, and the need for the Minister to do his job. If this Minister is unwilling to his job, or incapable of doing it, it is time for a new Minister of National Revenue.


Some Hon. Members:: Hear, hear!

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Henry Perrin Beatty: I would like to conclude my remarks, Mr. Speaker, with the central point which has to be kept in mind. The vast majority of Canadians are law abiding, honest and conscientious. They pay their taxes willingly and on time. They make an effort to obey the laws to the best of their ability. From the Government they are asking for respect since they are honest people. They are asking for presumption of innocence until proven guilty. They are asking for decency and fair treatment. Surely that is not too much for ordinary Canadians to ask of their Government. Surely in a civilized society, in a democracy such as we have in Canada, any Government which gives anything less to its people deserves to be put out of office.


Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, once again I rise to discuss an issue that is before all Canadians, and that is the whole matter of our tax system. I am pleased to see that the Progressive Conservatives have rallied to the concerns that people have brought to our attention regarding the abuses being perpetrated by Department of National Revenue officials in various parts of Canada. The inequities and injustices of the tax system are now being articulated by the Progressive Conservative Party. We have heard a great deal about this in the last number of years and we in the New Democratic Party have been attempting to point out the difficulties that arise.
If there is a theme that we have developed year after year after year, it is the fact that the tax system in this country, whether on an individual basis or on a business basis, is one that is unjust, one that is unfair, one that treats different Canadians differently and one that is biased in favour of the upper income earners, the wealthy and powerful in this country. It is a theme we have brought forward consistently over the last number of years and today we do so again. I am glad to see members of the Progressive Conservative Party rise in their places and say that there are problems with the Canadian tax system.
We are approaching the time of year when Canadians become preoccupied with filling out income tax returns. Once again perhaps as many as 16 million Canadians will file a tax return on a voluntary basis, declaring their incomes and the tax payable. It becomes a preoccupation with more and more Canadians to find ways of avoiding taxes, not because they are attempting to remove themselves from their responsibilities in the country and not because they are dishonourable in terms of not wanting to pay their fair share, but they know in their hearts that by all accounts the system of taxation in the country is grossly biased and unfair. It is an unjust system.
To confirm this we have only to go back to the early sixties when the Royal Commission on Taxation, the Carter Commission, backed up by more than 150 tax experts, found that the tax system in Canada was grossly unfair. It declared that ordinary Canadians were being asked to pay more than their fair share of taxes, that those in the top income brackets were paying too little tax and consequently those in the lower income brackets were being asked to pay more than their
share. From that Royal Commission came the phrase "a buck is a buck and should be taxed accordingly".
Well before Christmas in the House we passed a piece of legislation that will, once again, give an unfair advantage to those Canadians who derive their incomes from investments as opposed to those whose incomes are devired from salaries or wages. Again, this protects a very select group of Canadians from the ravages of inflation. Inflation is something the average Canadian has to accept. The continual decrease of the purchasing power of his dollar is a fact of life. The legislation passed in early December will protect those Canadians who derive their income from investments and is just one more example of the unfairness of our tax system.
I do not think these points can be overemphasized, Mr. Speaker. There are Canadians who are able to take advantage of the loopholes in the tax system that the Government has provided and which will enable them to get out of paying the taxes that most Canadians have to pay. This makes the system more and more unjust as the years go by.
1 believe it was in 1979 that the Government identified 200 loopholes in the system and attached a particular cost to them. Each loophole was identified with the amount of money which it cost the federal treasury so that it could say this amount of dollars, be it $300 million or $2 billion, a certain group of Canadians is going to retain in this particular year and, therefore, it has to be made up elsewhere or the deficit begins to grow out of hand.
It identified 200 loopholes, Mr. Speaker, and what is the effect? The tax returns for 1981 made it clear that there were a number of Canadians who did quite well in terms of income for that year, but were not required to pay any federal income tax at all. As a matter of fact, back in 1981 there were 297 individuals in our country whose incomes were well in excess of $2,500,000, there were many individuals who earned half a million dollars, and many who earned in excess of $1 million, who by utilizing the existing loopholes in the tax system were not required to pay a single penny of federal income tax.
To bring it down to, perhaps, a more common level, Mr. Speaker, in 1981 there were many Canadians who made in excess of $50,000, and of all of those who had that amount of income there were 8,000 individuals who required a special status. There were 8,000 individuals in 1981 with incomes in excess of $50,000 who paid not a single penny in federal income tax. As a result of the increase in loopholes, Mr. Speaker, that number was up 64 per cent from 1980, which makes it clear what is happening to our tax system. We are allowing more and more Canadians to get out of paying their fair share of income tax in our country.


An Hon. Member:: That is Liberal progress.


Nelson Andrew Riis: It is a version of Liberal progress, I suppose, with the idea that if you allow certain Canadians, particularly those in the upper income brackets, to avoid paying any income tax, they will take that money and invest it and, therefore, the rest
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of the citizens of Canada can benefit. I suspect that same argument can be made for everyone in the country. Giving an average working man in Canada an opportunity to retain some of those tax moneys to invest as he or she sees fit would also result in more economic activity in the country. However, although we do this for one select group, those in the upper income bracket, we certainly do not do anything of a similar nature for the ordinary working Canadians.
The corporations, Mr. Speaker, in 1981 and 1982 were very profitable and, again because of the existing tax system and the loopholes therein, they were able to use the system through their tax accountants and tax lawyers so that they paid no income tax whatsoever. Just a few days ago there were reports made public in our country which pointed out that the tax rates for small businesses in Canada were significantly higher than the tax rates paid by the large corporations. It is a very biased system, Mr. Speaker, which is exemplified most obviously by the Bank of Montreal, which in 1982 made a few hundreds of millions of dollars in profits, yet paid not a single penny in income tax. It had $22 million deferred to the 1983 taxation year as well.
One could go on and on, Mr. Speaker, speaking of the most obvious abuses of the tax system. However, today we are focusing in on the unfairness of it all. We have heard from Hon. Members from the Progressive Conservative Party with respect to the fact that National Revenue is coming down hard on individuals. We have all had countless letters and briefs presented to us from our constituents because Revenue Canada, in a desperate grab for revenue, is bringing undue and unfair pressure on many Canadians. Later today my colleague will talk about the problems which are faced by those in the artistic and cultural communities.
I would like to identify one particular problem area, that is, the food producing business. In parts of Canada we have seen the heavy hand of National Revenue come down on those farmers and ranchers who have struggled, in many cases for generations, to establish a viable operation. One particular family comes to mind. I know of a young rancher and his wife who have three children. They have worked in the ranching business for their entire lives and recently were operating a 200-head cattle ranch in central British Columbia. That family, I think it fair to say, worked from dawn to dusk, seven days a week, for years and years and because of the falling cattle prices and increasing costs of all aspects of the ranching operation, were finding it more and more difficult to make their necessary payments. The husband was required to go out and seek alternate employment for a few days a week driving a gravel truck. As a result of the income obtained from that particular venture, the officials of the Department of National Revenue decided this individual was no longer a cattle rancher, although his wife worked every single day of the week; as well as all three children before and after school, and that individual, other than those few hours a day when he was driving the gravel truck, worked to keep that ranch viable.


An Hon. Member:: It was a hobby ranch.
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Nelson Andrew Riis: They did not go quite so far as to call it a "hobby ranch" but they did call it a part-time operation. It is with that kind of uncaring approach, Mr. Speaker, that officials with no understanding of what ranch life involves make a decision based on some immediate cash flow receipts which is absolutely incorrect. I must add that when the matter was brought to my attention and I intervened with the Department of National Revenue, there was a reassessment. The whole matter was re-examined and I believe justice was brought to bear in this situation and they were again classified as a full-time food producer, which they truly were.
There are many examples of this kind of situation. The point is that it is well known that the Liberal Government, as a result of economic mismanagement, has had to go out and make a very desperate bid to obtain taxes from Canadians. Part of the problem is of its own making because over the years it devised a tax system which has permitted so many Canadians to pay no income tax and to really abuse the system by using the legal loopholes which the Liberal Government has so generously provided. Government must now go to the average Canadian, Mr. Speaker, and punish those individuals, trying to squeeze a few more dollars in order to balance its books.
I would like to say something on behalf of my Progressive Conservative colleagues. I also read in the newspaper, the Ottawa Citizen this morning, that the Canadian Press reports that more than half the Hon. Members of the federal Progressive Conservative caucus have had disputes with the Revenue Department over their personal taxes. Some people have gone so far as to say that this is one of the reasons that the Progressive Conservatives have risen up and spoken so vociferously against the Department. I know that my colleagues in the Progressive Conservative Party are honourable men and that certainly there would be no truth to the fact that because half of the Progressive Conservative caucus are having difficulties with Revenue Canada, this would motivate them to raise this subject day after day in Parliament, coming down hard on the Minister of National Revenue (Mr. Bussieres). I know that would not be the case with those Hon. Members. I wanted to clarify that for the record because of some perhaps inappropriate statements raised in today's press.
The question which we must address today, Mr. Speaker, is this. Is the system of taxation in place in the country today a fair one? I do not believe there is the possibility any longer of the Government being able to fake it in front of the people of Canada. We find small businesses in this country pay taxes at a higher rate than large businesses. There are countless examples of individuals paying absolutely no income tax at all. Report after report outlines the injustice of the present system, including the Government's own report entitled "Analysis of Federal Tax Expenditures for Individuals", which was released in November, 1981. It concluded that in 1979 the average taxpayer with an income between $10,000 and $15,000 saved $771 on his income tax through tax deductions. However, in that same year citizens with incomes greater than $100,000 managed to save $46,000 on their taxes. What is even more

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striking, said the report, is that there were hundreds of individuals with incomes in excess of $100,000 who had arranged their affairs so that they paid no federal income tax at all. These reports have taken the time to examine the tax system of this country and have outlined very clearly the unfairness of this particular system.
Back in 1979 a study done by Allan Maslov, an economist at Carleton University School of Public Administration, found that exemptions provided roughly 100 times greater benefit to those in the upper income brackets than to those at the bottom end of the scale. A hundred times greater benefit to the upper income earners of Canada, Mr. Speaker!
1 do not think it would benefit the House for one to go on and on describing how unjust and how unfair the present tax system is. Canadians know it and as a result people are becoming more and more reluctant to pay what the Government says is their fair share of the taxes of Canada. However, I think the 1983 tax year points out most effectively where the bias in our system is, Mr. Speaker. Canadians are now filing their tax returns for the 1983 tax year and 1 want to use as a precise example three individual taxpayers. Taxpayer A had an income in 1983 of $200,000 from dividends. Taxpayer B is a similar individual with an income of $200,000 as well, but based simply on employment income through salary. Typical taxpayer C has an income of $25,000 based on wages.
When you take advantage of the traditional loopholes available-I do not mean investing in Canadian films and Canadian drilling funds and all of those options available to people with a considerable amount of capital at their disposal at the end of the taxable year, but just taking advantage of the traditional, typical kind of tax loopholes in today's system and on today's forms-you find that taxpayer C, the average Canadian wage earner, is paying taxes at about 14.4 per cent. Interestingly enough, the taxpayer with $200,000 salaried income pays taxes at 43.8 per cent. That is what you would expect to find in a progressive tax system. He is paying more taxes at a higher tax rate than an individual raising a family on $25,000. However, when you consider that individual with an income of $200,000 based on investment income, income received from dividends, he pays at a tax rate of 18.5 per cent, virtually the same rate as the individual making $25,000 a year. There, Mr. Speaker, as clearly as can be presented using the 1983 tax forms, you find that a taxpayer with $200,000 income based on dividends is paying taxes at virtually the same rate as an individual with an income of $25,000 based on wages.
The system is unjust, Mr. Speaker. It is unfair. One can make a case for it being virtually corrupt. Yet the system is perpetuated and perpetuated. The most recent piece of legislation introduced by the Government was again to provide further protection for those individuals whose income is from investments, to protect them from the problems of inflation.
I want to close, Mr. Speaker, by identifying changes in the burden of those providing Canada's taxation. Back in 1960
individuals paid about 57 per cent of federal taxes and corpor-tions paid about 42 per cent. By 1980 that had changed to 70 per cent from individuals and 30 per cent from corporations- quite a dramatic shift over a 20-year period in the shouldering of the tax burden of Canada.
I would like to present an amendment to the motion that the Official Opposition has before the House today. I move:
That the motion be amended after the words "individual taxpayers" by inserting the following:
"and which favours big business and upper income earners at the expense of
small business and average working Canadians,"


Mr. Evans:: Mr. Speaker, I was just curious about a comment the Hon. Member made. He indicated there had been a dramatic change in the distribution of taxes paid by corporations and individuals. Is the Hon. Member aware that during the 1970s the increase in personal income in real terms after inflation was something over 100 per cent, whereas the increase in corporate profits has actually been negative in real terms? It declined by something in the range of 10 per cent to 14 per cent. Since real incomes of individuals have gone up, you would expect that the taxes paid by individuals have gone up, you would expect that the taxes paid by individuals would have gone up accordingly, whereas since profits in real terms have dropped off in that same period, the proportion of taxes paid by corporations would have declined.
I understand what the Hon. Member is saying. He is trying to imply that there has been some conscious shift of the burden of taxation. However, I would like to ask the Hon. Member to consider that when you understand that the amount of income available to individuals has grown dramatically while the amount of income after expenses to corporations has actually declined, would that not give rise to the kind of redistribution he mentions in his speech?


Nelson Andrew Riis: Mr. Speaker, I appreciate the intervention of the Hon. Member. I believe when you look at the figures we have available you will find when talking about profits and individual income that we are talking in many respects about two different things. I do not think that-


John Leslie Evans: That was good bafflegab.


Nelson Andrew Riis: It is not an attempt at bafflegab whatsoever. I am trying to say that I think what the Hon. Member is saying is that we ought to be comparing two different things. We are talking about earned income and the taxes paid thereon. When you talk about taxation of corporations, you are talking about the income of corporations after the appropriate deductions available and so on. When you factor both of those in and look at 1960, it is very clear that the taxes coming into the coffers of the federal Government from individual Canadians and Canadian corporations have witnessed a dramatic shift over the past 20 years. That is the point I am attempting to make. There has been a tremendous shift in that tax burden. As we see less and less, on a percentage basis, from the corporate sector, we must look elsewhere to find those funds. More and more the money is coming from Canadian individuals. I
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believe that knowledge is one of the problems that Canadians are facing today.
I know the Hon. Member is aware of the example of two well known corporations in this country, Shell Canada and the Bank of Montreal, which pay no federal income tax at all. Everyone is aware of the profits that each of these major corporations has made and I believe it is very clear that average Canadians become disturbed and wish to find ways and means of avoiding the taxation system, not because they are dishonest or dishonourable people but they know they are being asked to pay an unfair burden of today's federal taxes.
As a result of all of this we are driving a great deal of the Canadian economy underground. Some estimate that there is an underground economy of approximately $15 billion as a result of Canadians doing whatever is necessary to avoid the prying eyes of National Revenue. This type of approach to our economy is unhealthy, not in our best interests and is being perpetuated by National Revenue in its present policies.


Henry Perrin Beatty: Mr. Speaker, I have a simple question for the Hon. Member. At the outset of his remarks he stated that there has been a deep concern on the part of his New Democratic Party colleagues with respect to abuses by the Department of National Revenue. He will know that in the past two months no issue has been more prominent and no question has been asked more often in Question Period than those related to National Revenue. Literally scores of questions have been asked. Why has the NDP not asked any of those questions?


Nelson Andrew Riis: Mr. Speaker, the point I was trying to make, obviously not very successfully with the Hon. Member, is that we in the NDP have been standing in our places for years pointing out very carefully the injustices in our tax system. When points have been raised about Canadian corporations and individuals not paying a single penny in income tax, has there been one Progressive Conservative rise in his or her place to make that same point? Never! When we in this particular Party stood in our places in an attempt to point out time and time again the injustices of the taxation system as it applies to the Canadian banking system, did a single Progressive Conservative Member ever stand in his or her place to raise that issue? Never.
To answer the Member's question directly, when it came to the matter of National Revenue coming down on many of our constituents-in my own case I can recall in excess of 45 or 50 cases-I and my colleagues have intervened on their behalf with the Department of National Revenue. I am pleased to say that on many of those occasions when a re-examination inevitably took place, the matter was rectified. Based on my own experience of intervening on behalf of many of my constituents, I can say that this has been the case.
We felt that the matter had received public airing both by members of the Opposition, by the national media and other individuals in the country, that the point had been made amply
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clear and that not rising in our places was not saying that members of the NDP had not been fighting on their own for individual Canadians across the country on this particular issue. I am pleased to say that, because of our interventions on behalf of our constituents, we have been successful in most cases.


Mr. Fisher:: Mr. Speaker, I listened with some interest to the Hon. Member's comments. I congratulate him on how he expressed his views. We have heard them before, and if some of the Tories have not perhaps they should come into the House more often.
My question to the Hon. Member concerns the example he gave about ranchers who got into difficulty. I hope he will ask his colleague who will discuss artists to deal with this problem as well. When we set up the cash system for farmers and ranchers, we set up a very attractive tax system for people to take advantage of. That exception draws in people. In turn that requires Revenue Canada to use extraordinary methods to determine whether people are following the system properly or abusing it, since it is so attractive. We have heard from farm groups who say that it is attractive and ask that we be careful that it is not abused since they want it to continue in the future. We have had that advice.
With respect to the example of the rancher who had to derive outside income, what advice would the Hon. Member give the Government in order to avoid precisely that difficulty which the rancher experienced? I ask this question seriously because I believe that farmers right across Canada have had real trouble with declining income and high interest rates and have had to go off their farms to make extra income. We need guidance from sincere members like himself who have experience in this area and who might have a few ideas. We do not want to abuse the system but we must make sure that some unhappy taxpayers do not abuse it as well. I look for some advice from the member.


Nelson Andrew Riis: Very briefly, I want to agree with one of the points raised by the Hon. Member. That is the difficulty placed on the legitimate food producer today by those individuals who are using the provisions of the tax system to their advantage at the expense of the legitimate rancher. It is disturbing to me to drive through certain valleys in my constituency and meet legitimate cattle ranchers who are struggling to raise beef while next door there is a hobby rancher who is raising the same kind of cattle and essentially attempting to lose money. It is that kind of difficulty which I appreciate.
I believe that if one looks carefully at the books of a legitimate cattle producer and has some sensitivity as to what is involved in that particular endeavour, there is no question at all who is legitimate and who is illegitimate when it comes to a particular business and using the tax system to the appropriate end. All I am saying-and I have heard this from members of the Official Opposition as well-is that the tax system should be more sensitive.


The Acting Speaker (Mr. Guilbault):: Order. Debate.

January 19, 1984
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Hon. Pierre Bussieres (Minister of National Revenue):: Mr. Speaker, the motion before the House today has two distinct concerns. The motion first refers to the complexity of the Income Tax Act and to the problems such complexity may cause, and then goes on to refer to certain practices of those who are responsible for enforcing this complex legislation, using certain terms to qualify those practices.
Finally, the motion's sponsor commented on other factors that went beyond concerns raised in his motion.
Mr. Speaker, once again I would like to make it quite clear to the House that I have never withheld any information in my answers to questions put by Hon. Members. As soon as a problem was brought to my attention, I immediately took steps to check the facts. I also made sure that my senior officials explained the Department's policy to our local managers. In addition, I made sure that this policy was well understood, if and where it was not followed, and it is now being observed.
Mr. Speaker, I feel my position is absolutely clear and without ambiguity. And if I did refuse, as I said yesterday in answer to questions I was asked, to play the petty games of certain Opposition Members, it does not mean that I withheld any facts. On the contrary!
I want to deal with the first aspect of the motion, the complexity of the Income Tax Act. The Department of National Revenue, Taxation, does not prepare nor write the Income Tax Act. The fiscal policies imbedded in the Act are the responsibility of the Department of Finance. I am sure the Parliamentary Secretary to the Minister of Finance (Mr. Fisher) will discuss that issue later today. But we in Revenue Canada, Taxation, administer that complex legislation, and it is the reason I want to comment on that issue.
Its very complexity is a cause of concern for the Department. But before just stating that the Act is complex, one has to answer the question why the Act today is so complex. The first point I want to draw to the attention of the House is that the growing complexity of the taxation of income in Canada in part reflects the growth in the complexity of our society itself. We have signs of that increased complexity first in the way we do business and the way we organize and structure our business enterprises.
These important changes have called for additions and for amendments to the Act, additions and amendments that reflect the complexity of those business structures to which I have just referred. Any member of this House who has the slightest knowledge of how those business structures have evolved will understand the impact those changes have on our fiscal system and on the provisions of the Income Tax Act, because those provisions deal with those specific changes. Any tax practitioner will give you dozens of examples of those
complex structures and of the relevant provisions of the Act that were needed to meet those new situations.
A second point in relation to the complexity of the Income Tax Act also reflects the way we organize our personal affairs. In the years when the vast majority of Canadians had an average income that was necessary to cover their needs for living, no money was left to invest and not much money was left for saving. That income covered a person's basic needs and the needs of his or her family.
The wealth in the country has increased more than significantly since the last war. I think Canadians have paid tribute for that to the different Liberal governments we have had in this country. Canadians now have bigger incomes. Canadians have money left for investment. Canadians have money left for saving. Liberal Governments have designed fiscal measures in order to alleviate the burden of taxation on those savings and on those investments so as to promote the participation of all Canadians in the development of our industry, promote the direct interest of all Canadians in the development of small business and to help Canadians prepare for a secure retirement. All those measures through the tax system contribute to added complexity in the Act.
A third reason for complexity stems from the fact that the Government has used the taxation system as a vehicle to complement our generous social security programs. I will just give an example. The present Minister of Energy, Mines and Resources (Mr. Chretien) when he was Minister of Finance introduced the child tax credit. That measure is a significant help to those most in need in our country. However, it has added another complexity not only to the Act but to the TD-1 form which taxpayers use to file their return. I could refer to many other personal exemptions that have added to the complexity of the Act, personal exemptions for senior citizens, additional exemptions for the handicapped and many other areas.
A fourth reason for the growing complexity of the Act is the fact that the system was used as a means of delivering economic assistance programs. I think of the investment tax credit, the MURBs, accelerated depletion and research and development. I want to point out that both federal and provincial Governments have used those means through the tax system in order to help Canadian citizens and businessmen to invest and develop and strengthen our economy.
As we all know, Canada's tax system is based on a system of self-assessment. Yet because of the growing complexity of our tax laws, taxpayers experience increased difficulties in completing their returns, not only to ensure that they are complying with the laws, but also to ensure they are availing themselves of the various forms of tax relief to which they are entitled. That phenomenon is not the discovery of the century made by the Opposition. For the last few months I have had the opportunity to discuss that issue with my colleagues in caucus, with my colleagues in Cabinet, with the Minister of Finance (Mr. Lalonde), and also with practitioners all across the country.
January 19, 1984

[ Translation]
Mr. Speaker, I believe the complexity of the Income Tax Act makes very specific demands of the Department of National Revenue. We want better enforcement of the Act and better compliance with its provisions, and we also want those who are in a position to benefit from the generous measures that Liberal governments have made available to Canadians through the tax system to receive those benefits. The Department of National Revenue therefore has a responsibility to give more adequate information to help Canadians comply with legislation that has become more complex because, among other things, it has given taxpayers a better chance to contribute to the development of this country or save for their retirement, or again assist directly those members of our society who are in greatest need.

The second part of the motion refers to the capricious and unfair practices of the Department.

Mr. Speaker, I must admit I am very concerned about the manner in which officials of the Department of National Revenue are being judged on the basis of assumptions in this accusation, because it is my profound conviction that this accusation has no basis in reality and goes beyond the honest concern of the legislator who wants to correct the deficiencies that can exist in a Department as complex as this one, and that it is a demonstration of facile rhetoric and narrow political partisanship. If the Members opposite are naive enough to believe that Canadians can be convinced that a Conservative Government will stop enforcing the Income Tax Act, they are wrong. Canadians have a better understanding of the problems facing them than the Leader of the Opposition. Mr. Speaker, if the Leader of the Opposition goes along with the game being played by his colleagues, he has yet to reach the age of reason. If he wants taxpayers to believe that enforcement of the Income Tax Act will be less strict and therefore less equitable under a Conservative Government, he may be sure that Canadian taxpayers will be the first to criticize him for this.
Mr. Speaker, millions of Canadians have no choice but to pay their tax instalments every week, every two weeks or every month. The vast majority of Canadians are responsible people, and the vast majority of these people have never seen and probably never will see an auditor from the Department of National Revenue. It is up to the Minister, the Department and the officials of that Department to give those people the assurance that they are not carrying a greater tax burden because we are not checking whether other groups of taxpayers have failed to report their income as the legislation requires.
Secondly, Mr. Speaker, Canadians will soon understand that the Leader of the Opposition, if he plays the game being
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played by his Party Members, really wants to destroy the self-assessment system and undermine the system's credibility. They will soon understand that the Leader of the Opposition and his Party are thereby rejecting the concept of equity underlying the administration of the Income Tax Act. And they are doing so while abusing the word "equity", Mr. Speaker.

Again I remind Hon. Members of the House that I often discuss that issue with my colleagues. Many Members on this side of the House and on the other side have brought problems to my attention. We have made every effort to look into individual situations and to help taxpayers with their difficulties. We want taxpayers to be treated with dignity; we want taxpayers to be treated with humanity. Indeed, those thousands of employees working across the country are human beings. The very nature of a human is to be subject to making mistakes. Our prime concern is to correct expenditiously any mistake which may happen, with apologies to the taxpayers concerned.
We in the Department have taken steps to correct situations when they were brought to our attention. Any Member of the House can give dozens of examples of where he or she has requested a review of a particular case by the Department and where the review was positive to the taxpayer. Larger problems in scope were corrected. The whole issue of quotas being imposed by overzealous supervisors on individual auditors is an example. That situation was corrected promptly.

A number of specific steps have been taken.

In view of the many concerns expressed by my colleagues in caucus and by practitioners in the many meetings I have had with them, in view of the fact that my concern and the concern of my colleagues in the Government is that taxpayers are treated with respect and humanity, and in view of the growing complexity of the Income Tax Act, I am pleased to announce that I have retained the services of Woods Gordon to conduct a study of the administration of the Income Tax Act.


Some Hon. Members:: Hear, hear!


Mr. Andre:: That only took two months of hounding.


Henry Perrin Beatty: What a confession of failure on your part!


Pierre Bussières: Mr. Farlinger, a senior partner in the firm, will be the person responsible for conducting the study. The consultant will examine both the service and enforcement aspects of income tax administration.
The first objective of the proposed study is to evaluate what the Department is doing with respect to its services to the public and to make recommendations on what more might be done. The second aspect of the proposed study will be to evaluate the effectiveness of and make recommendations on these departmental activities.
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January 19, 1984
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Mr. Speaker, we are not advocating efficiency to the detriment of the basic rights of Canadians and taxpayers. I have asked for that study to obtain an objective opinion on the situation, along with recommendations on the best way to ensure the most humane administration of a very strict and very complex act. I do not want that study to last for months on end.

1 have asked Mr. Farlinger, who will conduct the study, to give me periodic reports and to make recommendations as soon as they are ready. The Government and myself are concerned. We want to answer the concerns of Canadians.


Some Hon. Members:: Hear, hear!


MESSAGE FROM THE SENATE
The Acting Speaker (Mr. Guilbault):: 1 have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed Bill C-2, an Act to amend the statute law relating to income tax and to make related amendments to the Canada Pension Plan and the Unemployment Insurance Act, 1971, without amendment.



THE ROYAL ASSENT

['Order.']
The Acting Speaker (Mr. Guilbault):: I have the honour to inform the House that a communication has been received as follows:
Sir,
I have the honour to inform you that the Honourable Julien Chouinard, Puisne Judge of the Supreme Court of Canada, in his capacity as Deputy Governor General, will proceed to the Senate Chamber today, the 19th day of January, 1984, at 12.45 p.m., for the purpose of giving Royal Assent to a certain Bill.
1 have the honour to be Sir,
Your obedient servant,
Edmond Joly de Lotbiniere Administrative Secretary to the Governor General



[Stage Direction]
The House resumed consideration of the motion of Mr. Beatty:
That this House condemns the Government for its contempt for the taxpayers of Canada, which it demonstrates by the creation of a taxation system in the form of the Income Tax Act that is increasingly incomprehensible for individual taxpayers and, by its failure to end capricious and unfair practices of the Department of National Revenue.
And the amendment thereto of Mr. Riis:
That the motion be amended after the words "individual taxpayers" by inserting the following:
"and which favours big business and upper income earners at the expense of
small business and average working Canadians,"
Henry Perrin Beatty: Mr. Speaker, what a confession of failure we have just heard from the Minister! After months of saying that there were no problems and that he had his Department in hand, the Minister has now said that he has contracted the matter out to a private consultant to tell him what is wrong with his Department. What a confession of failure! Will the Minister give the undertaking to the House that each one of the reports made by Woods Gordon on a periodic basis and the final report will be tabled in the House of Commons and referred to the appropriate committee for study?


Pierre Bussières: Mr. Speaker, the preliminary remarks of the Hon. Member attest to his bad faith. I never said that there were no problems within the Department of National Revenue. On the contrary, every time the Hon. Member, his colleagues or Members on this side have drawn my attention to specific problems, we have considered each case and made every effort to find solutions. As I stated, Revenue Canada has over 18,000 employees, and mistakes can be expected indeed in such a huge organization. What really matters is that the problems are taken under consideration and attempts are made to solve them.
The way the Hon. Member phrased his question, it would seem that he wants to thwart my efforts to implement as quickly as possible the recommendations which will be made to me.
In my statement, Mr. Speaker, I said to the House that I did not ask for a report in one, two or three years.

I have asked Mr. Farlinger to give me periodic reports. As soon as he has recommendations, I have asked him to bring them to me immediately in order to give me the possibility to consider those recommendations with my officers and try to find ways and means of implementing those recommendations in order to meet the real concerns of the taxpayers and improve the credibility of the system in the minds of all Canadians. We want action.


Mr. Speyer:: Mr. Speaker, through the weeks the Minister has made a distinction between the policy of his Department and the practice which actually exists on the street. On November 29 I asked him whether quotas existed. I believed in good faith, when he denied that they existed in Kitchener, that he was not aware of that. We have asked subsequent questions for days and days through December and January.
January 19, 1984

The most senior official that I am aware of with respect to this matter is Mr. Robertson, the Director General of Taxation. Last week he was quoted in The Globe and Mail as saying that quotas did exist and, second, they were caused by overzealous supervisors. He said that they were off the mark. There are some people who did set quotas. Another senior official was Mr. Shoobert who is in charge of the Toronto office. He said that quotas existed with respect to small business and that they also existed elsewhere. He refused to give comment.
Throughout the weeks I have been trying to find out what the practice is, what happens at the district office. Having been first alerted to the problem on November 28, and believing that he must have made extensive inquiries because of the number of questions, will the Minister help me and all members of the House by telling us where in fact quotas have existed, in what taxation offices, in what subsections auditors have been given quotas and how extensive the practice is, so that we can make our own judgment?


Pierre Bussières: Mr. Speaker, I believe that what is important in this whole debate is to ask ourselves why a Member of Parliament, in fact an Opposition Member, even though it could easily have been one of my Government colleagues, called the attention of the Minister to a situation he considered abnormal or anomalous, and why the Minister then met with his senior officials to ask them about it. In my opinion, this was to ensure that they would put a stop to this practice or anomaly, if it existed, or to similar anomalies if they existed elsewhere. I believe that the intent of the Hon. Member involved or of other Members in such a situation, is to ensure that the practice will cease because it does not agree with the policies of the Government and could at first glance be harmful to certain groups of taxpayers.
This was therefore the honest and very laudable intention of the Hon. Member in raising this issue. The issue was raised, the Minister looked into the situation and he received confirmation of the facts. The duty of the Minister in such a case is to pursue the same objectives as the Member who raised the issue, namely to put an end to the practice. This is what he did by asking that the policy of the Government be re-explained to the managers who are responsible for the work of supervisors and auditors.
The second step in meeting this objective of ensuring that the practice no longer exists, which is basically why the question was raised, because I am convinced that the Hon. Member did not want simply to satisfy his own curiosity, is to ensure that the Minister has received the assurance from his managers that they have taken action to put a stop to this practice in the case mentioned and in any similar case.
Mr. Speaker, this is how we have met the concerns expressed by the Hon. Member to ensure a better and more equitable administration of the Income Tax Act. Our objective
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was clear, namely to put a stop to certain practices which may have existed. Action has been taken, these practices have stopped and the objectives of the Hon. Member have been met.


Some Hon. Members:: Hear, hear!


Mr. Malone:: Mr. Speaker, what we need is not a continuation of bringing cases to the Minister as if Members of Parliament were ombudsmen, but rather that we have a Department run by a Minister who is fair and predictable. I ask the Minister to bear in mind the questions I asked two days ago and the comments made by the Hon. Member for Wellington-Dufferin-Simcoc (Mr. Beatty). One doctor had third party demands placed on 40 patients in that regard. I talked to the manager of a local bank who said that in his branch there had been a sevenfold increase in third party demands. Another bank told me about the obviously excessive number of third party demands. Other Members of Parliament have left me with the impression that this is not a local concern but rather one that is national.
Can the Minister tell us whether or not he has investigated these third party demands and their sudden increase? Can he give a justification for such an enormous increase? Does he recognize that when there is a third party demand in a small community the whole community knows, and when there are bounced cheques around everybody knows? Credit ratings are ruined. Does he know that in most cases virtually every third party demand is rescinded by the Government in 48 hours? How can he justify making them and then removing them? This simply destroys people's credibility. How can he justify that and still tell us that he supports a system which he upholds as fair?


Pierre Bussières: Mr. Speaker, the hon. member will certainly recognize with me that third party demands are not arbitrary actions on the part of a National Revenue official. I suggest that if he examined the legislation and sought information-he will not seek information, for he is not even listening to what I have to say-he would realize that such actions are taken only after taxpayers have greatly exceeded the periods of grace provided for under the act. And in most of the cases which I have examined, the taxpayers who had exceeded these periods of grace had also failed to contact their district offices to explain their situation. That is the first factor, Mr. Speaker.
The second factor, Mr. Speaker, is that the number of third party demands has increased because the number of accounts receivable, to use a common expression, has also increased. Last weekend, I mentioned an amount of $3.5 billion-


The Acting Speaker (Mr. Guilbault):: Order, please! The period reserved for questions and remarks has expired. I could let the Minister continue if there was unanimous consent. Is there unanimous consent?

January 19, 1984
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Some Hon. Members:: Agreed.


Some Hon. Members:: No!


The Acting Speaker (Mr. Guilbault):: As there is no unanimous consent-


An Hon. Member:: The Liberals are protecting him. He cannot answer.


The Acting Speaker (Mr. Guilbault):: We are back on debate with the Hon. Member for Cambridge.


Mr. Taylor:: I rise on a point of order, Mr. Speaker. The Minister said he wanted to be fair. Why are you cutting off questions that can properly be answered in this House?


The Acting Speaker (Mr. Guilbault):: That is not a point of order. I am simply applying the rules. There is a 10-minute question or comment period allowed after each speech. I have to remind the House that this period is over.


Gordon Edward Taylor: With unanimous consent you can have as long as you like for questions.


The Acting Speaker (Mr. Guilbault):: I do not have unanimous consent.


Gordon Edward Taylor: The Liberals are the ones that said no. Is that fair?


The Acting Speaker (Mr. Guilbault):: Order, order. The Hon. Member for Cambridge.


Chris Speyer: Mr. Speaker, Mildred Geisel is a widow who lives in Elmira, Ontario. She lost her husband several years ago and has not filed income tax forms. She gets an income of $11,000 per year plus her old age pension. In addition to that she owns a very small apartment building in Elmira which is taken care of by her son. Just after Christmas the income tax department went in and arbitrarily filled out her forms and made an assessment in which no expenses whatsoever were deducted. The amount of money which she owes is $40,000. Coincidentally, at the same time as doing the assessment they froze her bank accounts and seized everything, including the $11,000 that she received. There is one distinguishing factor about the Mildred Geisel case that I want everybody in this House to recognize. Mildred Geisel is 83 years of age.
The point that my colleagues and 1 have been trying to make in the last two months is that there is certain attitude which prevails. There is misbehaviour taking place on the street that we have to account for. It is not only with respect to audits; it is with respect to collections and prosecutions. It applies not only to old age citizens but to farmers, fishermen, small business people and all individuals. The Department has been totally indiscriminate in what I view to be its misconduct. It is only in the last 18 months that I have noticed in my constituency, and in conversations with my colleagues, that
there has been this dramatic shift in terms of attitudes. It is the Mildred Geisels, the farmers, the artists and the small business people that cause me concern. I call it an attitudinal problem.
What prompted the flurry of questions that you have heard our Party raise, Mr. Speaker, during the last two months in the House? It came to my attention in Cambridge that the eight chartered accounting firms sent a letter to the Minister of National Revenue (Mr. Bussieres). They made certain very serious charges. They said that standards of fairness and objectivity had been abandoned. I took this very seriously, coming from chartered accountants. They also said it appeared that quotas existed in that tax district.
As a result of receiving this letter I asked the Minister certain questions. He was reluctant to respond to me. However, in answer to the Hon. Member for Simcoe North (Mr. Lewis) and the Hon. Member for Yellowhead (Mr. Clark), he denied the existence of quotas. At that point in time I had no proof except the feeling of the chartered accountants of Cambridge. The Minister made a denial.
At this point I would like to say that the chartered accountants who gave me this letter, and who sent the Minister the same letter, were unanimous. Have you ever seen a situation where everybody in one profession can come to a unanimous opinion as to a course of conduct that may exist within a certain region? These were people of all political persuasions. They felt compelled to tell their Member of Parliament that a certain attitude existed within a certain regional office. The Minister denied it initially and I believe the Minister would not know that in the Kitchener district office a series of quotas existed. However, in Kitchener there is a gentleman in charge of all auditors. His name is Mr. Donald Cawley. The day after I posed the question in the House this statement appeared in the Kitchener- Waterloo Record:
Donald Cawley, chief of audit at the Kitchener office, said practices by Revenue Canada assessors are "just the same as always" and there have been no directives to crack down. He denied that assessors have quotas-
"They are entitled to their opinions. It's a free country. But most of what they're saying is full of "appears" and "apparentlys" ... If they have the facts to back it up, fine. But I would take it with a grain of caution until then."
This is the situation that existed at that time. I posed the question that the Cambridge accountants made me aware of. There was a denial by the Minister and the next day there was a denial that quotas exist in Kitchener. Mr. Cawley, as the chief of audit, is the person who denies the existence of quotas. I asked the question on December 19 after I had a governmental memorandum, prepared by the same Mr. Donald Cawley, imposing quotas on a subsection of auditors that deal with businesses that do business in excess of $12 million; in other words, the high bracket type of businesses. There were 10 auditors in this subsection and the quota per auditor was $3 million of extra income per year. Therefore, in the Kitchener district we are talking about $30 million of extra recovery.
In a self-assessing system there are a couple of givens. First, it is absolutely necessary to have audits to ensure that the law

is complied with; and second, everybody should pay their fair share of taxes.
1 would like the public to understand why quotas are bad. Why does even the Minister say that he does not like this particular practice? Quotas are bad because when someone comes in to audit my business or me personally, I want to be sure he has an attitude of objectivity, impartiality and fairness.
I do not want there to be pressure on an auditor from his supervisors or wherever to bill a certain amount of money per hour.
In Toronto we discovered that there was a S700 per hour quota for small businesses and we have the documentation for that. The Minister does not deny it. Just think of it, Mr. Speaker, $700 per hour! An audit may take three or four days or even much longer. If a person is squeaky clean, to use the street term, and has abided by the law but is the subject of an audit which takes three days, then the auditor should not bill anything because nothing extra is owing. In those circumstances we found that the auditor has to bill $5,600 per day. If he is in there for three days that comes to more than $15,000. That is the problem with quotas. We can see whether an auditor is good or bad without giving him a quota. What is more, the people who work for Revenue Canada at the local level do not want quotas either. They do not want to be measured by that departmental yardstick.
I have looked at the forms that the auditors have to fill out and I will provide copies of them to members of the Government. Every week they give the name of the taxpayer being audited. The worksheet shows the number of hours worked on that particular file and then, when the audit is finished, the tax change is shown. A yearly performance evaluation record is kept which shows how much the auditor is worth per hour. That is the reality of the practice on the street which has existed for several years. In the last two years the pressure on the auditors to bill their quota has been extraordinarily intense. The quota for a small businessperson in Toronto is $700 and for big business, such as insurance companies in Kitchener, $3 million.
A point that bears repetition, Mr. Speaker, is that we are speaking of extra income here. We all assess ourselves and declare what we owe but the auditors have to bill this extra amount in order to measure up to the departmental yardstick.
1 should like to deal with collection now. Statistics are king, Mr. Speaker. There are quotas with respect to performance in regard to collections. I know a professional individual who lives in Cambridge. He was reassessed and wanted to appeal the case, which involved $20,000. He also owed $16,000 from the previous year and had an outstanding bank loan which he was paying off. Revenue Canada wanted its money so he went to the bank, which agreed to reduce the payments on his loan. That meant he could increase the amount paid to Revenue Canada. He proposed to pay $1,000 per month to Revenue Canada in order to discharge his obligation of $36,000. He wrote to the Department and found that his offer was unacceptable. Third party notices went out to all his clients and, as in the case referred to by my colleague, the Hon. Member for
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Wellington-Dufferin-Simcoe (Mr. Beatty), in a small community like Cambridge his reputation was destroyed and he was forced to declare bankruptcy.
Of course, everybody should pay their fair share of taxes. But Mr. Speaker, that $1,000 per month that would have gone into the public coffers went down the drain because of his bankruptcy. The public did not benefit; it suffered, because the person involved now has no obligation in law to discharge the debt he originally incurred and which he wanted to pay. He did not want to go bankrupt.
I cannot stress enough how important it is to maintain one's reputation in a small community. It may take a lifetime to build up that reputation but in one day it can be ripped down. As my colleague pointed out, the SIN number is required, and a third party notice is served at the bank, right or wrong, and many times it is wrong. I for one understand that in some circumstances a garnishee is necessary, but there are many circumstances where harsh and oppressive methods take the place of reason. Professional people remember a time when taxes were paid over a period, whatever was reasonable, and negotiations took place; but all that has stopped.
I should like to talk now about ministerial responsibility, Mr. Speaker. I hope some Hon. Members opposite will agree with me and will say so publicly. The Minister started out by saying that quotas do not exist. Then on December 19, he said that quotas do not exist except in one area, Kitchener, and that it was an isolated circumstance. Then he changed his story as the evidence continued to pour in and said that they do in fact exist. Obviously they exist in Toronto. He said that outside the House; he did not confess it inside the House.
My colleague the Hon. Member for Wellington-Dufferin-Simcoe and I have tried to ask the Minister how extensive this practice is within the country. My colleague from Calgary asked the same question. It is important for Members to understand the malignancy that exists with respect to attitude. The Director General of Taxation said that it does exist but refused to comment on it. The head of the Toronto taxation district office said it exists with respect to small businesses but refused to give other details. If Question Period is to mean anything, surely it must mean that the Minister has a duty to respond to legitimate questions about how much a situation is practised. This morning, in good faith, I posed a question to the Minister about the practice. Aside from what he states the policy might be, what is the practice? He refused to answer. I cannot think of a more contemptuous way of treating his colleagues in the House than by this stonewalling.
I should like to talk about artists and farmers now, Mr. Speaker, and state why I believe they are being harshly treated. Section 18 of the Income Tax Act deals with allowable deductions. Business is not defined in the Income Tax Act. There is a broad definition of what encompasses a business. Section 18 states that any outlay or expense which is incurred for the purpose of producing income is an allowable expense.
As a result of case law the Department of National Revenue imposes this criteria on the farmer or artists: Was there a

January 19, 1984
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reasonable expectation of profit? When a farmer or an artist declares a loss, usually he has a profit from some of the business at the same time. It is the practice of Revenue Canada to look at that loss and play the role of the Monday morning quarterback. When it comes to farming it does not take into account the fences that have to be mended, the seeding that must be done, the clearing of the bush.
The history of farming in Canada is that these people have maintained their farms by having other jobs. In eastern Canada, in my riding, legitimate farmers could not stay on their farms unless they had another income to allow them to carry on. But Revenue Canada, having quotas in mind, says: "Was there a reasonable expectation of profit?" I agree with the Hon. Member from Kamloops to this extent; I do not believe that hobby farmers should get the deductions, but I do believe that people who are bona fide carrying on the practice of farming should be able to deduct their losses. They are not able to do that right now.
With respect to artists, coming from my regional municipality, I know it sometimes takes 25 years to recognize a person's work of art. The test should not be whether there is a reasonable expectation of profit. The test must be whether or not that person was pursuing, as a legitimate business, the skill of being an artist or a writer.


Douglas Glenn Fisher: How do you define it?


Chris Speyer: You will have your opportunity to ask these questions.
It is in the last two years that Revenue Canada has really cracked down. It has put the screws to Canadian taxpayers, and why? Revenues have shrunk. We all know what the expenditures were. Corporate profits are down. Because of unemployment, people who normally pay tax to Revenue Canada are not doing so. It is a combination of these factors which caused the circumstance where there is tremendous shrinkage of revenue. Government has to take responsibility for turning the screws on the average hard-working businessperson, farmers and fishermen. No one seems to escape the net. At election time, this Government is going to have to account for this.
There is a general atmosphere of fear with respect to the Department of National Revenue. No one wants to tangle with Revenue Canada. Everyone wants to mind their own business. They do not want to be audited. It is not a very nice experience, although necessary. However, there are the prosecutions, the harassment and threats. I have a letter from a constituent by the name of Dexter Lawson. I have another from a citizen in my community by the name of Russ Edwards who says that a Revenue Canada auditor has literally threatened the existence of his company. It is time that people stood up to these fascist tactics which are being used by people on the street.
There are some Members across the aisle who have admitted that a situation exists which they are not willing to tolerate. I was impressed by the comment the other day in
Calgary of the Hon. Member for Sudbury (Mr. Frith). The Hon. Member for Kitchener (Mr. Lang) has also made comments which at least acknowledged the situation. We have a Minister here who is now asking Woods Gordon to perform the function which he was sworn to do. That is a public acknowledgement of the malignant situation which exists. He was not on top of his Ministry and did not know what was going on in the street, and because no one has confidence in the actions of his Department, he is now asking Woods Gordon to go in. That is the reality of the situation. I view this announcement as a victory because it is a signal that the Government recognizes a very bad situation in fact exists.


Douglas Glenn Fisher: Mr. Speaker, I apologize to the Hon. Member for interrupting his speech. He was quite right when he said to me that I would get a chance for a question afterwards; I apologize to him now for interrupting him at that time.
I would like to ask the question which I shouted across the floor. How would he define artistic activity for tax purposes? If we are going to give the taxpayer the advantage of the cash system, and give the working taxpayer the opportunity to write off losses which might be incurred in artistic activity, then how would the Hon. Member define artistic activity for the sake of the tax system?


Chris Speyer: Mr. Speaker, the question being posed by the Hon. Member involves a question of judgment. I will come right to the point. The existing situation is a judgment by an auditor. The judgment is, is there a reasonable expectation of profit?


Douglas Glenn Fisher: No.


Chris Speyer: Yes, it is. On every letter which one sees from an auditor of Revenue Canada, where losses have been denied with respect to an artist or a farmer, it is always on the basis that he plays the role of the Monday morning quarterback and says: "I know your farm operation. I know what you have done 365 days a year. The Department does not think that you can make any money." That is what the judgment is now. What the judgment ought to be with respect to farmers is this: Is it a legitimate business-


Mr. Speaker:: Order.



[Stage Direction]
A message was delivered by the Gentleman Usher of the Black Rod as follows:
Mr. Speaker, the Honourable Deputy to the Governor General desires the immediate attendance of this honourable House in the chamber of the honourable the Senate.
January 19, 1984
[Stage Direction]
Accordingly, Mr. Speaker with the House went up to the Senate chamber.
And being returned:
Mr. Speaker:: I have the honour to inform the House that when the House went up to the Senate chamber, the Deputy Governor General had been pleased to give in Her Majesty's name the Royal Assent to the following Bill:
Bill C-2, An Act to amend the statute law relating to income tax and to make related amendments to the Canada Pension Plan and the Unemployment Insurance Act, 1971-Chapter No. 1.
It being seven minutes past one o'clock, I do now leave the chair until two o'clock this afternoon.
At 1.07 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.


Mr. Howard Crosby (Halifax West):: Mr. Speaker, the officers, men and women of Maritime Command who, together, constitute Canada's Navy, must carry out the mandate to defend Canada's territorial seas and coasts using ships and equipment aged to the point of obsolescence.
Since serving people have no channel to voice their concerns or complaints, parliamentarians have an obligation and responsibility to focus attention on existing problems.
Early in January Maritime Command reduced its sea training exercises to cut costs. Later, in Halifax Harbour, our naval force was exposed to media and public ridicule because some of the ships in our naval fleet failed to function. Two ships, the Ottawa and Saguenay, have served for a period spanning almost three decades. In that time aviation has advanced from propeller aircraft to interplanetary rockets.
The responsibility for such misadventures rests not with the officers, men and women of Maritime Command, but with those who control expenditures on national defence, that is, the Government of Canada and the Minister of National Defence (Mr. Blais).
The Prime Minister (Mr. Trudeau) and the Minister have recently pronounced Canada's navy an effective fighting force. This is no compliment to Maritime Command, but an attempt to mask our failure to provide modern ships and equipment for our naval force.
I appeal to the Minister of National Defence and his colleagues in the Cabinet immediately to review and reassess the financial and other assistance allocated to Canada's navy. The Korean airline disaster leaves no doubt that other nations are capable of hostility and war-like actions. Let us take our national defence seriously and honour our international commitments to our allied nations.



AIR TRANSPORT


Mr. George Baker (Gander-Twillingate):: Mr. Speaker, the announced relocation of the head office of EPA from Gander to Halifax yesterday, and of the termination of 350 full time jobs at Gander, is a disaster to the community and a serious blow to the Newfoundland economy.
Apart from the most serious social problem this creates, the rationale used by the company to date makes no sense at all, and the attitude of the Government of Newfoundland can only be described as callous.
If the rationale of the company is purely economic, then the problem perhaps can be solved in pure economic terms. The loss in direct tax revenues to the Newfoundland Government will be over $2.2 million a year, and the loss to the economy of the province is over $30 million a year in wages and salaries. Surely that in itself is enough for provincial government direct intervention.
The losses of the company last year were due to labour disputes that have now been solved. EPA without labour disputes was touted to be the most profitable airline in Canada, and that was while they operated out of Gander, Newfoundland.
For the sake of the hundreds of people affected, some way must be found, provincially or federally, to postpone this decision or to cancel it altogether.



ONTARIO PROVINCIAL POLICE


Mr. John McDermid (Brampton-Georgetown):: Mr. Speaker, far too often our police officers are taken for granted and are not given the recognition they are due. It usually takes an incident such as the one I would like to relate to the House today to remind us of this fact. It is also good to pause for a moment and reflect on just how fortunate we in Canada are, to be able to turn to these people for help, to see them as friends and not the enemy as they appear to be in many jurisdictions in the world today.
Recently, an Ontario Provincial Police constable observed a car travelling at 65 kilometres an hour on Highway 401. The driver appeared to be unconscious. The officer was able to

January 19, 1984
position his cruiser in front of the out of control vehicle and bring it safely to a halt. Having done so he rushed back to the car, found that the victim was not breathing, and applied cardio-pulmonary resuscitation. When the driver's breathing was restored he was transported to the hospital, where he remains in critical condition.
We should be thankful for policemen like OPP Constable Terry Demerse, and for the bravery and consideration that he and his fellow officers demonstrate on a daily basis.
The victim was Senator Allister Grosart, a good friend of many in this House. I wish to say thank you to these good Samaritans, on behalf of the House of Commons and the people of Canada.


Some Hon. Members:: Hear, hear!

[ Translation]



FISHERIES


Mr. Andre Maltais (Parliamentary Secretary to Minister of Indian Affairs):: Mr. Speaker, I should like to ask simply whether it would be possible for the Department of Fisheries and Oceans and Parks Canada to get together and consider the advisability of establishing a salmon research centre on the North Shore. 1 cannot emphasize strongly enough the importance of salmon on the North Shore. People who know all about the Moisie River and others who have had the opportunity to go salmon fishing there-including the Leader of the Opposition who has travelled extensively in that region-are aware that a fish of that quality can indeed be a touristic and an economic asset. In my opinion, Mr. Speaker, since the Minganie National Park is at the mouth of the Mingan River, various departments should combine their efforts to establish in that region a major scientific and biological salmon research centre.
Make no mistake about it, the salmon species is practically doomed to extinction as a result of overfishing and acid rains. Mr. Speaker, it is imperative that the Canadian Government establish in the Mingan, Longue-Pointe-de-Mingan and Mata-mek region a major research centre to ensure the survival of that species for future generations.



CANADIAN BROADCASTING CORPORATION


Mr. Rod Murphy (Churchill):: Mr. Speaker, I rise on a matter that concerns a number of people in small northern communities in Canada, especially northern Manitoba. It is a
matter which may not seem important to a number of people in this House, but it is a concern of theirs. It is that over the years we have developed a practice of having the major networks compete to see which will cover various sporting events such as the Grey Cup, Stanley Cup, and the World Series.
This weekend, the Super Bowl game is on. It is not being carried by the CBC. In many of the communities I represent the only television coverage they have is from the CBC network. They would hope that the CBC and others, such as the Minister of Communications (Mr. Fox), would make an effort to provide that service so that they, like other Canadians, can see major sporting events.



CANADA ELECTIONS ACT


Mr. Stanley Hudecki (Parliamentary Secretary to Minister of National Defence):: Mr. Speaker, there has been some trepidation about changes to the Canada Elections Act which were passed unanimously through the House by all three Parties in October of last year.
It is a concern to me that many people are under the impression that one amendment, Section 72 of the revised Act, stifles freedom of speech during an election campaign. This is not so.
While the new regulations do prevent third parties from advocating during the 50 days of a federal election, through advertisements or handbills, that people should vote for or against a particular candidate or party, the rules do not prevent these groups from advertising their views on issues of the day during an election, nor do they prevent groups from advertising before an election is called to urge people to vote for or against a particular candidate or party. A candidate's name can be included in an ad by a third party during an election if the candidate endorses the ad and includes the cost of the ad in his or her electoral expenses. The amendment is designed, in effect, to prevent people from buying their way into Parliament by using third party involvement.
During an election, third party groups can promote a candidate by writing letters to the editor, participating in radio talk shows, by attending all-candidates meetings in support of a particular candidate, and by making door to door appeals.
Freedom of speech is not stifled by the new regulations. Rather, the amendments are designed to protect the integrity of the electoral process by allowing political candidates equal opportunity in terms of their election expenses.
January 19, 1984



NATIONAL REVENUE


Mr. Benno Friesen (Surrey-White Rock-North Delta):: Mr. Speaker, recently I received the following letter regarding the behaviour and conduct of officials of Revenue Canada in the Vancouver office. It reads as follows:
On Nov. 30, 1983, a payroll auditor with Revenue Canada called in person without prior notice on my tenants' residence, and demanded that she pay to him immediately the sum of $1,498.75 for non-resident taxes supposedly owed by the owner of the property for 1983. He further instructed her to cancel all the monthly postdated cheques her husband had given to me for the one-year lease period and issue new ones less $131.25 for non-resident taxes and send the amount each month directly to Revenue Canada Taxation. He threatened that if she did not comply to his demands that Revenue Canada would come 'after them' for collection.
(The official) went to my tenants' door without notice to them or to me, the owner. When I questioned both (the official) and his supervisor, regarding their action they explained that no letters needed to be written and that 'the Act' gave them the authority to do what they did.
I am appalled by such arrogance and lack of respect for the taxpayer.
The taxes have been paid. I heard the Minister say this morning that he felt that taxpayers should be treated with dignity, humanity, and respect. I applaud that view of the Minister, and I trust that he will look into this matter.



VOLUNTARY ORGANIZATIONS


Mr. F. Oberle (Prince George-Peace River):: Mr. Speaker, I rise today to draw the attention of the House once again and pay tribute to the invaluable contribution of many Canadians who, in the spirit of compassion and concern for their fellow men, give generously of their time and resources in pursuit of certain social objectives which we all espouse.
As Canadians we enjoy a standard of health and welfare which is the envy of most others in the global community of nations. But, as we are all aware, many of our fellow citizens or their children suffer from physical and mental disabilities, which deprive them of their full measure of the many blessings the rest of us enjoy. No effort by government alone, in terms of health care and welfare programs, could ever be sufficient without the work of those who give of themselves without reward, other than that which comes with giving.
Permit me to point to one of the finest examples of this great spirit by paying tribute to the many individuals and companies who, under the sponsorship of the Shriners Club of Prince George in my constituency, assist in conducting a telethon each year which appeals for funds to sustain the child development centres in our region, and which receives a most enthusiastic and generous response. I am joined by my colleague from Prince George-Bulkley Valley in my appeal to all the residents of central and northern British Columbia to tune into the TV network this weekend and to contribute once again
to this worthy and charitable cause. Giving is indeed good therapy.



THE ECONOMY


Mr. Pierre  Gimai@: On December 22, after the House had adjourned for the Christmas holiday, the Government of Canada announced that it had authorized the construction of the Shawinigan-Saguenay-Lac-Saint-Jean section of the pipeline at a cost of $245 million. These capital investments are of the utmost importance for the area and my riding of Lac-Saint-Jean, the more so because the Government of Canada intends to use them to help this area develop economically. As a matter of fact, by changing the regional disparity index under the Regional Development Incentive Act, the Government of Canada has given the corporations willing to invest in the Saguenay-Lac-Saint-Jean area the opportunity to receive a subsidy of up to 50 per cent of their capital costs, and not 25 per cent as was the case previously.
Moreover, an enormous effort has been made at the various airports in the Saguenay-Lac-Saint-Jean area to consolidate our infrastructure. Also, a major investment will be made in the Chicoutimi harbour to develop a badly needed industrial infrastructure in our region. All of this, in addition to the building of the pipeline, plus the availability of the Canada Works and Career Access programs to the private sector, should make it possible for the Quebec government, if it really wants to develop the area, to use our technological and electrical advantages and offer potential investors prime rates which could convince them to create jobs for our young people. All of this, together with the make-work programs which the Government of Canada has set up over the past three years-



EUROPEAN ECONOMIC COMMUNITY IMPORT QUOTA ON CANADIAN NEWSPRINT

Nelson Andrew Riis: Mr. Speaker, hundreds of thousands of Canadian jobs, many of them in British Columbia, are dependent up on the export market for Canadian newsprint. In the past, a significant portion of our newsprint exports has gone to the European Economic Community. However, within the last several weeks the EEC has imposed an import quota on Canadian newspring of 500,000 metric tonnes per year. This is fully 200,000 tonnes or 30 per cent below our traditional shipments to the EEC.

January 19, 1984
This comes at a time when Scandinavian countries are being given unlimited access to the EEC market. In 1974 Canada was granted an export concession to the EEC which set our newsprint quota at 1.5 million tonnes. By reducing this quota by two-thirds the EEC has clearly violated those GATT provisions which specifically prohibit the reduction of export concessions. Canada has now intiated proceedings against the EEC under the auspices of GATT.
On behalf of the hundreds of thousands of Canadians whose jobs are dependent on the health of the forest industry, I urge the Government on behalf of my party, pursue vigorously these actions against the EEC in this blatant attempt to discriminate against the Canadian forest industry.



SMALL BUSINESS


Mr. Lee Clark (Brandon-Souris):: Mr. Speaker, there is within Canada the potential to create thousands of new jobs for young Canadians, the potential to turn around the deplorable unemployment statistics created during this Government's tenure. The potential lies with the small business sector, the sector which accounts for half of all employment in Canada. Yet the Government has insisted on bogging down business people with nightmarish regulations and badly co-ordinated programs. Take, for example, the Small Businesses Loans Act, which guarantees loans for small companies. What the Government fails to realize is that unless the Act is changed to include working capital in the loan formula, it is virtually useless to many small businesses.
I recently met with business people in my constituency of Brandon-Souris, and they told me it is all but impossible for small companies to obtain long-term loans at fixed interest rates. Therefore, they cannot risk investing in the developments which would create jobs.
Today more than a half million young Canadians remain out of work. Instead of creating an investment climate which would alalow small businesses to put these young people back to work, the Government offers up a costly mixed bag of bungled programs and red tape. Instead of allowing jobs to be created, the Government's polices have contributed to record high unemployment. With that kind of a record the members of the Liberal Government should collectively hide their heads in shame.



ORAL QUESTION PERIOD


Hon. John A. Fraser (Vancouver South):: Mr. Speaker, my question is for the Minister of Fisheries and Oceans. A Department of Fisheries working paper, which is probably still secret, dated January 5, 1984, states:
The Pacific salmon fishery is in "crisis".
The Pearse Commission reported in September, 1982, in almost the same words:
Canada Pacific fisheries are at a crisis point.
Dr. Pearse also went on to say:
Although aggravated by current conditions, the economic problems and other concerns are rooted in fundamental deficiencies in fisheries policy.
Just a few weeks ago Dr. Pearse said:
The situation in the salmon fishery is now worse than when I made my report.
How can the Minister explain the absolute lack of any action whatsoever over the last several years to address this urgent problem on the West Coast?


Hon. Pierre De Bane (Minister of Fisheries and Oceans):: Mr. Speaker, I think the Hon. Member has a very selective memory. In the last few months I have announced an increase in the man years of the Department on the Pacific side, and an increase in funding in order to improve the management side of things.
As for the fishery itself, I think the Hon. Member would agree that the most important problem on the Pacific coast is, and should be, the preservation and the rebuilding of the fishery resource. This is the fundamental problem. The Commissioner to whom the Hon. Member referred, Dr. Pearse, has made suggestions on how to reduce the fishing effort. I think the Hon. Member would agree that his suggestions were not accepted by the participants in the fishery.


DECLINE IN FISH STOCKS
John Allen Fraser: Mr. Speaker, the Minister says that he has recently made some appointments in his Department. Dr. Pearse was commissioned to look into what was then known to be a crisis in 1981. The January 5 working paper to which I referred enumerates in stark detail the fact that salmon stocks have suffered a decline; natural stocks are about half their potential and are declining at 1.5 per cent per year. Some stocks have become extinct and, as the Minister knows, Coho and Chinook stocks in some places are also faced with extinction
The working paper also points out that stocks have been fished at an average exploitation rate of 62 per cent, when 50 per cent is all that should be allowed just to maintain current levels. In view of the fact that in 1982, when the Cruickshank Committee reported:
January 19, 1984

The present fleet capacity and overcapitalization is the direct result of government inefficiency-
Because of-
-a series of misjudgments and inaction.
-my question is the question everyone on the West Coast is asking. Why has the Minister wasted two winters since the Pearse Report without implementing any buy-back program whatever?


Pierre De Bané: Mr. Speaker, I have difficulty in following the logic of the Hon. Member who now wants to blame the Government for those who have decided, contrary to elementary common sense, on overcapitalizing and overexpanding their fleet.
As to his question about why I have waited, it was for a very simple reason. When the Pearse report became public, I met with all the associations on the West Coast and told them that it was up to them to come forward with a proposal on how to reduce the fleet. It was not the Government which ordered them to buy and expand their fleet. They said, "Mr. Minister, we have a favour to ask of you. Please do not implement those recommendations related to the fleet before we have had time to put our own proposals to you, and they will not be put to you sooner than next November", last November. As the Hon. Member knows, last November they made some suggestions to me. At this moment the Department is working on proposals to be put for consideration before Cabinet in the next few months.


FUNDING FOR EAST AND WEST COAST FISHERIES
John Allen Fraser: Mr. Speaker, my supplementary question is directed to the same Minister. With great respect, the Minister said that the blame lies with the fishermen. I would like to quote from his own Cruickshank report, as follows:
The present fleet capacity and overcapitalization is the direct result of government inefficiency and a series of misjudgments and inaction.
On Tuesday the Minister blamed opposition Members for raising this by saying: "It is obvious that when the Opposition does not have an issue, it tries to fabricate one". He should tell that to 17,400 fishermen and 4,000 shore workers on the West Coast of British Columbia.
In view of the fact that the crisis was government induced, in that the last buy-back program which was started in 1970 resulted in increasing fishing vessels by about 45 per year, how can the Minister justify putting up $200 million under the Kirby report, another $132 million to begin restructuring the Atlantic fleet, plus guarantees, and not even provide an initial loan, a loan guarantee, seed money, or funds to start a buy-back now on the West Coast when the need is so terribly obvious?


Pierre De Bané: Mr. Speaker, I think the Hon. Member is using a very
Oral Questions
despicable method of trying to pit Atlantic fishermen against Pacific fishermen. I can show him that the sharing of the Department's budget between the two coasts is most fair. If I look at the man-years, the budget for the Pacific is a very substantial one.
I remind the Hon. Member that I have resisted any government buy-back of the Atlantic coast fleet. As he knows, recently in the herring fleet, where there is a substantial overcapacity on the Atlantic coast, a solution was devised by the participants whereby those who remain in the fishery will pay for those who get out of the fishery.
If the Hon. Member wants to say that it is the Government which in any way, shape, or form encourages people to invest the way they invested in the last four years or five years on the Pacific coast, I am sure there is not a fisherman on the Pacific coast who would agree with him. He is giving a very distorted recollection of the facts.


EAST COAST FISHERY-FUTURE OF MAJOR FISH COMPANIES
Mr. Mel Gass (Malpeque):: Mr. Speaker, my question is also directed to the Minister of Fisheries and Oceans. I would like to remind him of the purpose of Bill C-170 which was passed in the House in November, 1983. It was "to facilitate the development of viable Atlantic fisheries that are competitive and privately owned".
What will the federal Government do in Nova Scotia to assist the private sector consortium in acquiring ownership and control of the H.B. Nickerson and National Sea Products companies to try to keep the plants operating and thereby maintain the thousands of jobs which are so vital to the Atlantic area?


Pierre De Bané: Mr. Speaker, I want to remind my colleague that the Government appointed a Task Force on Atlantic Fisheries. One of the mandates of the Task Force was indeed to find private investors who would be prepared to provide financing for various companies which were in trouble, and it was only as a last resort that the Government agreed to invest on a temporary basis.
In the case to which the Hon. Member refers, that of Nova Scotia, I can tell him that a solution has been found. All partners see eye to eye. The Government of Nova Scotia gave the green light last September 30 and, should it confirm its acceptance tomorrow, the problem would be solved. But once again, if the private sector can come up with a solution, we would be quite pleased to take it under consideration, particularly, I would point out to the Hon. Member, if it turned out to be a viable solution. The Federal Government will certainly entertain the possibility of making a contribution equal to that of the Government of Nova Scotia.

January 19, 1984
Oral Questions


NATIONAL SEA PRODUCTS COMPANY-BANK OF NOVA SCOTIA SHARE HOLDINGS
Melbourne Alexander Gass: Mr. Speaker, my supplementary question is directed to the same Minister. I draw his attention to an article which appeared in The Chronicle-Herald of Elalifax entitled: "U.S. Gunning for Canada's Social Fishery", in which officials of the United States federal Government and the United States fishing industry expressed their confidence that they would succeed in having countervailing tariffs applied to Canadian fish coming into the U.S.
In an attempt to forestall the countervail action and keep the Nova Scotian fishery in private hands, could the Minister tell the House whether his Government is prepared to purchase from the Bank of Nova Scotia its 51 per cent share of National Sea Products and provide the private sector proponents with the opportunity to market those shares and use the proceeds to begin reducing the $75 million debt?


Pierre De Bané: Mr. Speaker, I have a different definition from that of the Hon. Member of what is a private sector solution. If, in the mind of the Hon. Member, a private sector solution is one wherein taxpayers' money is given to a particular group, this is not what 1 have understood until today. In a private sector solution, they do not have to come to us for any permission whatsoever. They just have to make a bid to the present shareholders or board; they do not have to come to us.


Mr. Anguish:: It certainly should be your business. The final and ultimate responsibility for the safety, operation and management of uranium mines in Canada lies with the Atomic Energy Control Board; there is no question about that.


GOVERNMENT POLICY
Douglas Keith Anguish: Mr. Speaker, the fact is that the mine is not operating in a satisfactory manner. There have been eight or nine radioactive spills within seven months. Why was there no spill contingency plan anywhere before they got their licence? Obviously the requirements for health, safety, and the environment have been ignored. Is it a policy of the Government to support AECB's whitewash of its own regulations?


Hon. Jean Chretien (Minister of Energy, Mines and Resources):: It is an accident which is being investigated by my officials and those of other federal departments. I have been told that the spill level of contaminated waters is not critical at this time, and plans to recover those waters are being prepared and should be announced soon. Every precaution has been taken to avoid a recurrence of the accident of a few days ago, and we all want to make sure that a similar situation will not happen again in the future.


Douglas Keith Anguish: The fact remains that there is no spill contingency plan, and the Government issued that licence.


ATOMIC ENERGY CONTROL BOARD
Douglas Keith Anguish: Mr. Speaker, my question is directed to the Minister of Energy, Mines and Resources. The Minister knows that the previous provincial Government of the Province of Saskatchewan signed a surface lease agreement with the Key Lake Mining Corporation which required the mine to file a spill contingency plan before it would be allowed to open. Since then, the Conservative Government of Saskatchewan has allowed the mine to open without filing a spill contingency plan.
Given that the Saskatchewan Government had established in this public document that spill contingency plans were essential for the safe operation of the Key Lake mine, why did the Atomic Energy Control Board, which is under the authority of the Minister, not require the same assurances? In fact, that mine opened with a federal licence without meeting the requirements for obtaining that licence.


Joseph Jacques Jean Chrétien: Mr. Speaker, I am not in a position to give a precise answer to that question. The Board has made a ruling, and the accusation, or the positions of the two parties which have led the Government of Saskatchewan are not my business.


IMPACT OF RADIOACTIVE WATER SPILLAGES ON ENVIRONMENT
Douglas Keith Anguish: Mr. Speaker, my supplementary question is directed to the Minister of the Environment. In reply to my question on Monday, the Minister stated there were four inquiries going on. Yesterday he said there will be a report by the company on February 1. Given that the Minister of Energy, Mines and Resources is content to ignore the responsibilities of the Department, is the Minister of the Environment going to ignore the responsibilities of the federal Government by allowing the fox to clean up the chicken-coop? Why is he content to rely on the company to conduct the inquiry to correct its own recurring failures at that mine site, whatever the problems may be? What are the recommendations for a cleanup? Does the Minister believe there is room for an independent inquiry of some sort to ensure that the spill is cleaned up and that there should be a contingency plan so that we do not have in future such occurrence?


Hon.   Chas. L. Caccia@Minister of the Environment: Mr. Speaker, I reject the premise of the Hon. Member, who is so desperate in assessing his party's situation in the polls across the country that he is trying to create a lot of political dust. However, the issue should be approached in a sensible, rational, and logical manner.
January 19, 1984

The Hon. Member knows that since the accident occurred, the Saskatchewan Department of the Environment has had officials there. The AECB has had officials there. We have sent our officials, and the company is conducting a study. Next week the two officials who have gone to the site on behalf of Environment Canada to inspect the situation will be in Ottawa. I will be glad to invite the Hon. Member to the briefing session that I will organize on that occasion, so that he will be educated on the issue that he is trying to raise in this House.


NATIONAL REVENUE
Henry Perrin Beatty: Mr. Speaker, my question is for the Minister of National Revenue. After weeks of denying in the House, and elsewhere in public, the crisis that exists in his Department, the Minister today made the incredible announcement that he had hired a private consultant to tell him how to do his job. Will the Minister undertake that, immediately upon their receipt by him, all the consultant's reports will be tabled in the House of Commons and made available to the Canadian public, or will the coverup in which he has been engaging continue?


Pierre Bussières: Mr. Speaker, in the preliminary remarks of the Hon. Member we see an obvious sign of bad faith on his part. For weeks he has been drawing some problems to the attention of the House. The Government and I, as Minister of National Revenue, have those concerns in mind. As I said this morning, I had the opportunity to discuss those matters with my colleagues. Today we have given a positive answer to those concerns. The Hon. Member says that it is a recognition of something bad. There are always ways to improve any system. What we must show to the taxpayers is the will to improve a situation. Indeed, the final report prepared by Mr. Farlinger will be made public.


Henry Perrin Beatty: The problem is not bad faith. The problem is a bad Minister.


Some Hon. Members:: Oh, oh!


Henry Perrin Beatty: Let them shout.


REQUEST THAT MINISTER RESIGN
Henry Perrin Beatty: Mr. Speaker, the Canadian people want the Minister to answer this question. If he does not know what is wrong with his own Department, if he needs a private consultant to tell him what he should be doing, why does the Minister not do the honourable thing, resign, and allow the Prime Minister to appoint Woods Gordon as Minister?
Oral Questions


Pierre Bussières: Mr. Speaker, when someone does not have the courage to carry his arguments to their logical end, he attacks someone else. This is what the Hon. Member is doing. We are concerned and some taxpayers feel that they might be abused. We would not want the efficiency of the system to be achieved at the expense of the taxpayers or to trample on their rights ignoring the respect owed to them.
We have therefore asked someone who is objective and independent for advice and recommendations to improve if possible the administration of extremely rigorous laws, especially the Income Tax Act.
Mr. Speaker, asking for independent advice does not mean that you do not know how to correct problems. It means that you want what is now being done internally to be evaluated objectively, confirmed and even improved if possible.
Second, I want to ask the Hon. Member to reflect on the fact that businesses, large and small, regularly ask consultants for objective advice on the way to improve their operation. This study indicates that the Government is responding to the concerns of Canadian taxpayers and that it wants to take action instead of simply making totally negative criticisms.


DEPARTMENT'S PRACTICE IN DEALING WITH NOTICES OF OBJECTIONS FILED BY TAXPAYERS
Chris Speyer: Mr. Speaker, my question is directed to the Minister of National Revenue. I understand that there is another significant change in policy that the Minister has not announced, and of which many Canadians are not aware. It has to do with the collection of taxes. I have checked this with Mr. MacDonald of his Department, who, I believe, is in charge of this particular matter. Will the Minister confirm that where there is a notice of objection filed by a taxpayer, in circumstances where there has not been an audit on his file, collection has been postponed until it is put through the local appeals branch of the district office? This will have a very significant effect, especially with regard to artists, in the collection of taxes. Will the Minister announce that publicly to Canada?


Pierre Bussières: Mr. Speaker, in cases where, in the judgement of assessment supervisors, the assessment notices seem questionable, we have the power to delay the collection of taxes until further reassessment and review the amount due if required.


TAX COLLECTION POLICY
Chris Speyer: Mr. Speaker, this is a dramatic change in policy. Now, instead of collection initiating right at the time that the person receives it, what the collection

January 19, 1984
Oral Questions
department is doing is saying: "Wait until we take a look at it." I applaud the Minister on what he is doing. It is to the credit of this Party that it is happening. Will the Minister admit that there has been a significant change in collection policy which affects all people in Canada, especially artists?
[ Translation]


Pierre Bussières: Mr. Speaker, 1 have already told the House that I was concerned by the rapidly increasing number of objection notices filed with the Department, and, long before yesterday, I told Members of this House to complain to departmental officials and ask them to make a very careful review of assessment notices and audits to determine whether it would be possible to reduce the number of complaints and settle the conflicts even before the taxpayer has to present an objection notice.
Mr. Speaker, this is not a new policy. The Department has simply intensified an on-going procedure to avoid forcing taxpayers to fill in other forms and apply for a time extension for the payment of their taxes.


FINANCE
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, I wish to direct my question to the Minister of Finance. As the Minister knows, there are hundreds of thousands of people paying for houses which they purchased through mortgage agreements, usually with a bank. In most of the monthly payments is included not only the mortgage payment, but also the municipal tax. For a good part of the year that money is prepaid. Is the Minister aware of the fact that very often, if not always, the bank pays to the mortgage holder either no interest, or merely 3 or 4 per cent interest, at a time when the bank is charging 12 per cent or more on loans it makes? Given the fact that the banks are making such large profits, would the Minister have the Inspector General of Banks look into this practice to see whether in fact the banks are mistreating people who have purchased mortgages through them?


Hon. Marc Lalonde (Minister of Finance):: Mr. Speaker, I would be very pleased indeed to draw the point raised by the Hon. Member to the attention of the Inspector of Banks, and ask him to examine this issue and report to me. I will be very pleased to inform the Hon. Member of the results of the investigation by the Inspector General of Banks.


INFORMING MORTGAGEES OF RIGHTS
David Orlikow: Would the Minister have the Inspector General of Banks look into the question of whether the banks and mortgage companies let people arranging a mortgage know that if they want they can prepay their municipal taxes and in that way save a substantial amount of money?


Marc Lalonde: Mr. Speaker, I will certainly pass on the suggestion of the Hon. Member to the Inspector General of Banks. I will ask him to raise this issue and report to me. I will be pleased to inform the Hon. Member of the result of those discussions.


NATIONAL REVENUE
Mr. Otto Jelinek (Halton):: Mr. Speaker, my question is for the Minister of National Revenue. Notwithstanding the Minister's constant excuses, according to the senior tax policy adviser to the Canadian Federation of Independent Business, which represents 65,000 small businesses across Canada, it has come to light that Revenue Canada no longer asks taxpayers to justify questionable tax deductions. Instead, it simply disallows them automatically and gives the taxpayer 90 days to appeal.
Does the Minister not realize that small businesses and individuals are too busy struggling to make ends meet to argue with the Government, let alone to afford the costs involved? Will the Minister take immediate steps to alleviate this unfair practice in order to enable our small businesses to operate in an atmosphere free of harassment?


Pierre Bussières: Mr. Speaker, I have already indicated in this House, and indeed I said it again in my speech this morning, that I have had discussions with my senior officials on the matter. As I indicated, I am concerned by the increasing number of notices of objection that are filed with the Department, and I have asked for ways and means of holding discussions with the taxpayers, after audits are made and notices of assessment are sent out, to come to an understanding and spare the taxpayers further proceedings, as was mentioned by the Hon. Member.
It should also be kept in mind that this provision of the Act, which allows a taxpayer to object to a notice of assessment issued by the Department, does protect the taxpayer. Looking for instance at the outcome of such objections, it may be noted that most of the decisions being made at that level are in favour of the taxpayers, and therefore this is a procedure that gives extra protection to the taxpayers in dealing with the assessments issued by the Department.


REQUEST FOR MINISTERIAL ACTION
Otto John Jelinek: Mr. Speaker, it is obvious the Minister does not understand the process. My supplementary
January 19, 1984

question deals with the submission by the Canadian Institute of Chartered Accountants to the MacDonald Royal Commission on the Economy, which stated in part:
There have been cases where Revenue Canada has threatened to assess more than the amount which it believes is proper as part of a bargaining process to get the taxpayer to accept what Revenue Canada regarded as proper. This is unreasonable duress to place on an individual or a corporation.
When will the Minister shake up his Department and return to the collecting of taxes in a fair, humane, and civil manner, for the sake of the livelihood of small businesses and individuals? I hear the Minister of Finance laughing at this question. If the Minister is not willing to make the shake up, why does he not step aside and let someone else take over, who will?


Some Hon. Members:: Hear, hear!


Pierre Bussières: Mr. Speaker, I have already responded to the accusation that there was over-assessment whenever an audit was made of certain taxpayers. Mr. Speaker, I have made sure that our auditing methods and practices lead to a fair determination of the amounts to be assessed. This is a principle that is fundamental to our taxpayer auditing system. Mr. Speaker, that concern has been expressed. If the Hon. Member looks at the terms of reference of the study to be made by Mr. W. A. Farlinger, he will realize that the study will be dealing with such issues. And since Mr. Farlinger is to start on this pretty soon, we shall have a very early diagnosis of such situations of concern and, if he finds any problems in the current practices, we shall be in a position to effect immediate correction if need be.


CORPORATE SHAREHOLDING LIMITATION ACT
Mr. Brian Mulroney (Leader of the Opposition):: Mr. Speaker, my question is directed to the Minister of Consumer Affairs. If I am not mistaken, I saw her a moment ago behind the curtain. The Minister recently stated in the House that she intends to introduce a new competition policy. I would like to know whether we will again find in the bill-but I hope not- some provision which would revive Bill S-31?


Hon. Judy Erola (Minister of Consumer and Corporate Affairs):: Mr. Speaker, 1 would like to assure the Leader of the Opposition that there is no connection between the proposed competition Bill and S-31.
Oral Questions


BILLS-31-GOVERNMENT POSITION
Martin Brian Mulroney: By
implication, does the Government intend directly or indirectly to introduce some bill or provision which would revive Bill S-31? Has it tried to proceed in another way?

Hon. Judy Erola (Minister of Consumer and Corporate
Affairs): Mr. Speaker, it is not at the moment a Government priority, but I would bring to the attention of the Hon. Leader of the Opposition that the problem does exist. We encourage him to come forward with suggestions on how to improve S-31.


Mr. Speaker:: Last supplementary question.


Martin Brian Mulroney: The problem exists in the mind of the Government. Otherwise, there would be no problem. The Minister knows perfectly well that Bill S-31 has rightly given rise to a general outcry throughout Quebec from every group of our society. The people of Quebec have told the Government that they do not want Bill S-31 or anything like it. Taking this into consideration as well as the very reasonable comments made by Quebecers of all political hues, does the Government intend to introduce in the next several weeks or months a bill similar to Bill S-31 which would be as prejudicial as that bill?


Judith A. Erola: Mr. Speaker, again I would like to reassure the Hon. Leader of the Opposition that it is not a government priority. When he talks about provocation I would suggest to him that much of that provocation was led by the Leader of the Opposition and his Party, based on some very false assumptions. I suggest to him again that there is a great deal of work to be done in that entire area. It rests on the Members of the Opposition to do that homework.


Mr. Speaker:: The Chair has already allowed the Leader of the Opposition two supplementary questions. The tradition of the House is to allow two supplementary questions. The Chair will allow one last supplementary question.


Martin Brian Mulroney: The Minister has referred to provocation from this side of the House. She may rest assured that whenever she dares introduce a bill which could prove detrimental to the best interests of Quebecers, we will be there to fight her.
My question is as follows: Since this does not appear to be a priority for the Minister, could we have her assurance that there will be no Bill S-31 or its alter ego to deal with during the next few weeks and months of this session?

January 19, 1984
Oral Questions


Judith A. Erola: Mr. Speaker, I should like to assure the Leader of the Opposition that any bill coming forward that would deal with the problem would need the concurrence and support of Hon. Members opposite. I urge them to work on that matter.


ATOMIC ENERGY CONTROL BOARD
Mr. Jim Fulton (Skeena):: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources regarding the Key Lake mining operation. It is a very simple question. As the Minister knows, the Province of Saskatchewan and the operators of the Key Lake mine were required by the law of this Parliament to file contingency spill plans before being licensed by the Government. They did not file those contingency spill plans, but the Minister of Energy, Mines and Resources gave them the licence anyway. Why did he do that?


Joseph Jacques Jean Chrétien: Mr. Speaker, I think I did not give permission myself; it is the board that renders the decision. I am not sure that the premise of the question of the Hon. Member is the right one, but I will check that aspect. I am not sure they were obligated to file it in the same terms as reported by the Hon. Member, but I will check and report on it.


James Ross Fulton: Mr. Speaker, on this side of the House we are sure that contingency spill plans were not filed. We are quite sure that the Minister is the one responsible for issuance of that licence and he did issue it. I think the people of this country have the right to know why.


ISSUANCE OF LICENCE TO OPERATE MINE
James Ross Fulton: Mr. Speaker, under what kind of pressure did the AECB and the Minister issue a licence to the Key Lake mine, knowing full well that it was illegal and that the mine has operated illegally? Why did he do that, and under pressure from whom?
I see that the Minister is now getting his information from the Prime Minister. Maybe the Prime Minister got a call from somewhere and perhaps he would like to answer the question. The people of this country would like to know why those thugs over there are giving companies in this country illegal licences to operate.


Joseph Jacques Jean Chrétien: Mr. Speaker, the Minister of the Environment mentioned earlier that the NDP are desperate, looking for something to rescue them. I said I would check. The Hon. Member said there was some requirements of the Government
that were not met. I am not informed of any such obligation that had to be met.


James Ross Fulton: I know you are not informed.


Joseph Jacques Jean Chrétien: I will check that. If the law has been broken, we will make sure that the law is respected.


James Ross Fulton: You are a little late.


CANADA ELECTIONS ACT
Hon. Erik Nielsen (Yukon):: Mr. Speaker, I should like to ask the Prime Minister if he is giving consideration to the re-examination of the provisions of Bill C-169, as a matter of public policy, since mounting concerns appear to be expressed with respect to the provisions of Clause 72 and its effect on the Charter of Rights and freedom of speech.


An Hon. Member:: Is it cut and run, Erik?


Right Hon. P. E. Trudeau (Prime Minister):: Mr. Speaker, if the Hon. Member is referring to the amendment to the election expenses legislation, the answer is that that legislation, which originated with this Government in the early 70s, was written for a specific purpose, which was to destroy the inequality which arose from the power of money. We think it was a very progressive piece of legislation, putting every citizen and every candidate in this country on an equal footing in so far as election expenses are concerned.
I am sure the Hon. Member is asking a rhetorical question because his Party certainly supports my answer, since it supported the amendment brought in last Fall. It is an amendment to ensure that the Citizens' Coalition, or any other group with a lot of money, do not controvert the spirit of that law. I am very grateful to the Hon. Member for Yukon for giving me the occasion to explain that to the country. I know my explanation has his support and that of the NDP.


RECOMMENDATION MADE BY CHIEF ELECTORAL OFFICER
Erik Nielsen: Mr. Speaker, I appreciate that all Parties in the House of Commons supported that legislation. Since that time, of course, the Chief Electoral Officer, as is required by statute, has filed his statutory report to this House for 1983. In it he stated:
I believe this proposed amendment will ensure a level of equality amongst all participants in federal elections. It was carefully developed so as not to conflict with the intent of the Charter of Rights and Freedoms with respect to freedom of expression as this specifically relates to the election process.
The following are the important words in the report:
This notwithstanding. Parliament may find it desirable, in the light of the Charter, to be more explicit and specifically exempt media editorials from the proposed amendment.
January 19, 1984

In view of that recommendation on page 74 of the report of the Chief Electoral Officer for 1983, is it the intention of the Prime Minister and his Government, as a matter of public policy, to re-examine that clause?


Pierre Elliott Trudeau: Mr. Speaker, I am glad that the Hon. Member agrees with my previous answer. Of course, the complaint by the Citizens' Coalition was not against that aspect of the law which dealt with editorials. It is as well to remind them that there remains freedom of speech in this country. Anyone can get up and oppose any Party and any Member in any way. It is just that he cannot use the power of money, once again, to give him an advantage over other candidates.
The Hon. Member asks a specific question about something contained in the report of the Chief Electoral Officer which, the House Leader informs me, has just been tabled. I think we should do what the usual process calls for. In other words, that report should be referred, and it is referred automatically, to the Standing Committee on Privileges and Elections.
If the Hon. Member has some concerns I am sure he will express them, along with other colleagues who might have other concerns on other matters. I think it is good that we have the occasion in the House today, as we did yesterday, when Members on this side indicated the spirit of the law and of that amendment, to reaffirm the intention that all parties had in supporting that amendment.


CROWN CORPORATIONS
Mr. Bill Clarke (Vancouver Quadra):: Mr. Speaker, my question is directed to the Prime Minister as it concerns the actions of three of his Ministers. The Minister of Transport recently fired the Auditor General from his position as auditor of the newly named Canada Ports Corporation. The Minister responsible for Canada Post fired the Auditor General from the Canada Post Corporation after 100 years of experience of doing that and reporting to Parliament. When the Minister of Finance was Minister of Energy, Mines and Resources, he fired the Auditor General from Eldorado Nuclear Limited, about three months before that Crown corporation became insolvent.
The whole country is anticipating legislation that will give more accountability to Crown corporations. Is it now the policy of the Government that Parliament should get less accountability by removing its servant, the Auditor General, as auditor of these Crown corporations?


Pierre Elliott Trudeau: Mr. Speaker, I think the Hon. Member has been misled by reading some editorials on the subject. He will know that the Canada Ports Corporation is a new Crown corporation which was just created. It is therefore not a matter of firing the Auditor General, who could not have had the job before because the corporation
Petitions
did not have the job before. It is a matter of setting up a new corportion under the authority of the laws of Parliament and appointing an auditor to it. We have appointed an auditor who is from an independent firm, and who, I believe, works for many, many respectable governments, corporations, and parties.
The Hon. Member opposite talks about patronage. I would ask him to ask his own leader whether Touche Ross do not and have not worked for corporations, and have not been appointed by the Tory Party. He will find, on the contrary, that they have a very heavy contract in that direction.


DISARMAMENT
Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, my question is directed to the Prime Minister and concerns media reports, and a press release just handed to me, with respect to a communication which he has received from Soviet Leader, Yuri Andropov, in reply to his request for a meeting. I am wondering whether the Prime Minister could elaborate on this matter and share with us the views concerning this letter. Does he intend to make it public? Further, can he give us his views as to the possibilities of arranging such a meeting in the near future?


Pierre Elliott Trudeau: Mr. Speaker, I believe the essence of the letter was in reply to a suggestion that sometime next week, or before the end of the month, I would be prepared to travel to Moscow, and if I could not meet with Mr. Andropov I would be happy to meet with any other ministers or officials among the leadership which he would designate. The essence of his answer was to indicate to me that he preferred that I meet with himself personally and he asked me to be patient, that he hoped to be able to discuss dates with me in the not too distant future.


Some Hon. Members:: Hear, hear!


PETITIONS
Mr. Speaker:: I have the honour to inform the House that the petition presented by the Hon. Member for Guelph (Mr. Schroder), by filing with the Clerk of the House on Wednesday, January 18, 1984, meets the requirement of the Standing Orders as to form.

January 19, 1984
Privilege-Mr. Deans PRIVILEGE


Mr. Speaker:: The Chair has had two notices of privilege and would hear the Elon. Member for Hamilton Mountain and then the Hon. Member for Burnaby.


Mr. Ian Deans (Hamilton Mountain):: Mr. Speaker, as you will recall, yesterday I began to raise what I consider to be a serious breach of privilege. I drew to your attention, Sir, and to the attention of the House, two references in the Fifth Edition of Beauchesne which deal directly with privilege. I would like to put them on the record so the record will be clear when this matter is considered by yourself. The first reference is under the definition of "Privilege" and Citation 21, on page 13 of Beauchesne's Fifth Edition, states as follows:
The most fundamental privilege of the Flouse as a whole is to establish rules of procedure for itself and to enforce them.
In that same edition of Beauchesne, on page 221, Citation 718, which deals with Public Bills, states:
The purpose of first reading is to allow any bill to be introduced, printed and distributed so as to give Members an opportunity to study it.
The practice in the House of Commons over the years-and I contend that that practice has been broken-has been that a Bill in its final form would not be distributed for public scrutiny in advance of that Bill having received first reading in the House of Commons. It has even been the practice, as my colleague said, that no Bill, without prior agreement, would even be distributed to Hon. Members in advance of its having received first reading.
Yesterday, as I mentioned, the Solicitor General (Mr. Kaplan) in his wisdom decided to invite the press to what was called for the purpose a "press lock-up" in order that he could bring to the attention of the press the contents of a Bill which was to deal with the setting up of a security force for Canada. Members of the press attended in a committee room and they were briefed extensively both on the Bill itself and on the purposes of the Bill, and they were given copies of the Bill. I point out that they were given those copies in advance of the Bill having been presented for first reading in the House of Commons.
The Minister made two mistakes, in my judgment, which constitutes a breach of my privileges as an Hon. Member. The first mistake he made was in giving out that Bill in its final form in advance of its having received first reading. The second mistake he made was that he did not make adequate provision to secure that those individuals who were given access to the information were in fact kept in that room until after the Bill had been properly presented to Parliament and the Bill had received first reading after the Hon. Members present voted in the House of Commons.
It is known to me and to others that members of the press- perhaps others, but certainly members of the press who were present for that briefing-were able to leave the briefing room prior to the time the Bill was given first reading approval by
the House. I suggest to you, Mr. Speaker, that there is no doubt in my mind, taking into account the two citations which I mentioned, that a breach of my privileges as an Hon. Member certainly did occur yesterday afternoon.
I will repeat the second of the two citations which states as follows:
The purpose of first reading is to allow any bill to be introduced, printed and distributed so as to give Members an opportunity to study it.
The distribution of a Bill cannot and must not take place in advance of that Bill having been given first reading in the House of Commons. It is to that I address myself.
The distribution of a Bill in its final form must not be distributed to others in advance of Hon. Members of the House of Commons having received it, and that occurred yesterday. That Bill was part of the package given to the press. The press were not properly locked up, as is the custom and requirement. The press left the room in which the briefing took place prior to the Bill having received first reading. The press in point of fact were able to leave the room on a number of occasions during the time the briefing was taking place. In fact, around the hour of 4.30 yesterday afternoon most if not all of the members of the press who had been present at the so-called lock-up left the room.
I suggest to you, Mr. Speaker, that it is a serious breach of my privileges that the press, or anyone else who has access to the contents of legislation, should receive such legislation in advance of Hon. Members of the House of Commons. The reason I raised the question with you, Sir, is not to exact retribution but to try to establish some reasonable ground rules with which we could live in this House around how a Minister should conduct himself or herself in advance of legislation having been properly put before the House.
I suggest that one of two things could happen. If you were to find that there has indeed been a prima facie case of breach of privilege, the matter could be referred to the Privileges and Elections Committee, and I would be prepared to agree to that. However, that is not what I seek. I seek that the matter be referred to a committee. Whether it would be the Privileges and Elections Committee or the procedural affairs committee is, in my judgment, immaterial. I would be prepared to accept it if the Government would be prepared to offer that that be done. That would be a suitable way of coming to grips with what kind of conduct we in the House of Commons expect from Ministers of the Crown in the performance of their duties.
I therefore ask you, Sir, to take into account what I said yesterday and what I have briefly put before you today. I also ask you to take into account that this is not an entirely new matter but is a matter which was put before Mr. Speaker Jerome on November 27 of 1978, at which time he admitted that the practice which was growing up was a practice which really did deserve some consideration with regard to its appropriateness. Consideration ought to be given to establishing some rules surrounding the practice of lock-ups and the way they would take place, and if lock-ups were appropriate, where and under what sort of circumstances they would be allowed.
January 19, 1984

Speaking for this Party, we would very much like to have those kinds of ground rules established once and for all. I therefore ask you, Sir, in the interests of achieving that, if you do in fact find there is a case for adequate consideration of this question as a breach of privilege, then 1 would move a motion 1 feel confident would be accepted by the House and would finally clear this matter up.


Mr. Speaker:: The matter of privilege raised by the Hon. Member for Hamilton Mountain was raised previously, and these are supplementary remarks. There is a matter flowing from the same incident and the Chair is not certain whether it is the same matter of privilege or not, but it will hear this before ruling. Are there other Members rising to be heard on precisely the point raised by the Hon. Member for Hamilton Mountain?


Hon. Ray Hnatyshyn (Saskatoon West):: Mr. Speaker, I will not be too long. I wanted to add some remarks I hope will be helpful to you and members of this House in determining whether or not there is a legitimate question of privilege here which should be reviewed by the appropriate committee of the House.
Let me put the proposition to you, Mr. Speaker, in a slightly different way. In my submission it was not a lock-up as such which occurred yesterday. Rather, it was a pure and simple release of the document prior to its being tabled in the House of Commons. There was provision made for an exclusive briefing of the press in the West Block by the Solicitor General (Mr. Kaplan), at which time he released the proposed Bill which, as you know, Mr. Speaker, is always marked "confidential" prior to being tabled on the floor of the House of Commons whenever it is in the hands of any of the Table officers or officials of the House. Furthermore, there was no undertaking given by any Member of the Press. It seems to me that the normal procedure in a so-called lock-up is that members of the press and, I underline, interested Members of Parliament or critics in the Opposition are obliged to sign undertakings with respect to the confidentiality of the documents they are about to receive.
This is important, Mr. Speaker, for these reasons. One can understand very clearly why confidentiality exists on budgetary matters, but the same principle applies with respect to any piece of legislation even though the royal recommendation in this particular instance may not have been of budgetary proportions. In a true and unfettered parliamentary system there is no suggestion that Members of the House will have the legislative intentions of the Government in final form brought before them prior to any press briefing or manipulation, or any attempt at such manipulation, by the Government of the press and hence of public opinion.
I want to draw to your attention another matter which 1 think is germane to your consideration of this matter. Not only did the Solicitor General release to members of the press, including Members of Parliament, proposed legislation that was to be tabled in this House; he also conducted at noon
Privilege-Mr. Deans
yesterday a briefing of members of the other place. I suggest that in addition to members of the press, the members of the other place received copies of the proposed legislation and the only commitment asked of them was that they keep the matter confidential until one minute past three. I am so informed by members of the other place and verily believe that that was the only commitment made by them with respect to this legislation. Again, there were no undertakings by them or specific constraints placed on them, except with respect to the Bill itself, that it be kept confidential by them until that time.
We know what the circumstances were, Mr. Speaker. First reading of the Bill took place at ten minutes past six approximately. 1 suggest that members of the press released a full account through the Canadian Press and other media. After three o'clock they left the briefing room, Fded their stories and Canadian Press phoned the office of the Government House Leader, the President of the Privy Council (Mr. Pinard), concerning whether or not the Bill had been tabled for first reading. They were advised by the Minister's office that it had been tabled. Subsequently a call was made by the Minister's office to Canadian Press to tell them that the information was wrong, but the story had already been issued on the wire well in advance of the time at which first reading actually did obtain. There was premature disclosure, Mr. Speaker, contrary to well established rules, custom and traditions of this House.
There are good and valid reasons why legislative items should not be released-


Mr. Pinard:: Where is the rule? What number?


Ramon John Hnatyshyn: Mr. Speaker, the President of the Privy Council will know, because he had a small amount to do with the constitutional debate, about the concept of parliamentary custom and tradition.


Yvon Pinard: One example?


Ramon John Hnatyshyn: He of all people should know. He has spent all his time in the small debt courts of Quebec, and he knows not of what he talks on this issue. I am not going to be deterred by the President of the Privy Council.


Yvon Pinard: Mr. Speaker, the Hon. Member, who is a lawyer, should know that in Quebec lawyers are not admitted in small claims court. He should know that. Maybe they are in his province but in Quebec a lawyer is not allowed to plead a case in a small claims court, so he should know better.


Ramon John Hnatyshyn: I was only going on the basis of his reputation in the House of Commons. I just assumed that was the only place he had practised. However, I want to get back to this serious point.


Yvon Pinard: That is the second time I have told you that.


Ramon John Hnatyshyn: The Fifth Edition of Beauchesne at Section 16 states that privileges are enjoyed by individual Members because the House cannot perform its function without unimpeded use of the services of its Members. It is for the

Privilege-Mr. S. Robinson
protection of its Members and vindication of its own authority and dignity. The whole point of confidentiality, Mr. Speaker, is that Members of the House of Commons should receive legislation for their own consideration unencumbered by any attempt on the part of any Government Minister to mount a massive and self-serving publicity campaign through the media. We are in a modern age now, we have television and so on, and by the time the matter comes before the Members of Parliament the Solicitor General has given the scripture according to his version, and it is being spread across this country. I suggest that interferes with our ability to look at legislation in an unfettered manner.
There is in my estimation a prima facie breach of the confidentiality which clearly and unequivocally surrounds any legislation. As you well know, Mr. Speaker, none of us is able under normal circumstances to obtain copies of legislation before it is tabled because it is marked "Confidential". 1 would support very much a ruling from you that there is a prima facie case of breach of privilege of Members here. 1 think it is important for the parliamentary system in Canada that we in fact have a review in the appropriate committee of precisely the rules that should be followed with respect to the tabling of documents and the confidentiality that occurs prior to the tabling of documents in the proper way. I support very much the proposition put forward by the NDP House Leader.


Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, 1 rise to make some comments with respect to the question of privilege currently before the Chair, but primarily to raise a separate but related question of privilege. I think it is important to note that what we are dealing with here in many respects is unprecedented in the House. In two important aspects, what took place yesterday has not occurred before. First, I believe it is unprecedented for a lock-up to take place on proposed legislation as opposed to budgetary measures. Of course, there is an important distinction. Second, I think it is unprecedented, and I would welcome any suggestion to the contrary, that in the course of a lock-up on a budget matter or another confidential matter-as I say, I do not believe there has been a lock-up of this nature on legislation-it is unprecedented that Members of Parliament have been excluded from that lock-up.
It is rather ironic, given the legislation we are dealing with, that this blatant attempt at management of the press has so transparently backfired on the Minister who attempted it.
I fully support the arguments which were made by the two previous speakers. As well, I want to deal with another element of privilege which may be thought by some as peripheral but which I believe is an important question of privilege.
As Your Honour knows, the Speaker has control over all parliamentary precincts. I do not have to cite the many precedents in Beauchesne, Erskine May and others which state very clearly that by long tradition it is the Speaker alone who must have conduct and control over parliamentary precincts.
Similarly, Members of Parliament have another privilege, which in effect is a privilege of the Speaker but one that is shared by Members in the enforcement of that privilege. It is simply the long-standing privilege of full and untrammelled access to parliamentary precincts barring an order from the individual who has control and jurisdiction over those precincts, and that, of course, is the Speaker himself. For that reason I want to set out the sequence of events which took place yesterday and, I believe, led to a breach of my privilege and the privilege of all Members of Parliament.
I recognize that the press feels somewhat wounded perhaps by the events of yesterday but I would hope that it would recognize that we are dealing with a fundamental question here and not with the role of the press.
I was informed that in fact I would be receiving, as is a custom and has been acknowledged as such by some Members, a copy of the legislation in issue, the security legislation, approximately an hour before the tabling of the legislation. This would be on a confidential basis, of course.
I showed up at the press lock-up, which was not really a lock-up at all, as has been indicated, at approximately two o'clock and was informed that my office and the office of the Leader of my Party had not received any documents whatsoever. I sat in the press briefing and indicated that I intended to remain in that press briefing because I felt that my rights as a Member of Parliament should at least be equal to those of the members of the press in a situation of this nature. I therefore insisted that I had the right to remain at that briefing.
I was informed, not by an officer of the Chair or an employee of the Speaker but by the press assistant to the Solicitor General (Mr. Kaplan), a Mr. Andrew Caddell, that I had no business being in this press briefing and that I was to leave the briefing. Of course, I took exception to that suggestion and indicated that I had no intention of leaving the briefing. At that point apparently there was a suggestion that the Bill itself would be distributed to those who were present.
I want to comment on those who were present as well. It has been suggested that this was a lock-up. If this was a lock-up, I wonder what kind of lock-up it was. There was no suggestion of any checking for identification whatsoever. People wandered in and out and it was not only the press which was there. For example, I know there was at least one member of the research staff who wandered in there. Anyone could have wandered in off the street.
Mr. Caddell did not ask for any kind of identification whatsoever. What kind of mockery does this make of the rights of Members of Parliament when there is open access, it would appear, to this Bill in its final form to everyone but the Member of Parliament who insists on attending that briefing?
Since there is no one other than Your Honour or Your Honour's employees who has the right to order Members of Parliament out of the parliamentary precincts in the manner in which the employee of the Solicitor General did, surely that constitutes a breach of privilege of Members of the House. 1 think Your Honour will recognize that this constitutes a
January 19, 1984

separate question of privilege, that is, the question of who has the right to summarily dismiss Members of Parliament from the precincts of this Hill. I suggest, with respect, that a servant of the Solicitor General has no business whatsoever in usurping that role from the Speaker and from the employees of the Speaker.
In conclusion, what has transpired constitutes, in my view, a breach of the privileges of the House in that it was an unprecedented-and I emphasize unprecedented-attempt to shape and manipulate the press' perception of this legislation. The Government did not want any opposition Members of Parliament in there because they might take exception to what is being said by the Minister's servants. That kind of attempted press management may reek of 1984 but certainly you, Mr. Speaker, as the guardian of the House, in effect, have an obligation to ensure that this does not happen again.
As I indicated, the second question of privilege is a breach of my privileges as a member of this institution to have untrammelled access to the precincts of the House without some employee, a press assistant of the Minister, insisting that 1 have to be thrown out.
Those are the bases of the question of privilege and certainly I would be prepared to move the appropriate motions if Your Honour feels that this is a matter which should indeed be referred to the Committee on Privileges and Elections.


Hon. Bob Kaplan (Solicitor General of Canada):: Mr. Speaker, I think that the NDP has revealed richly today and yesterday, when they delayed the proceedings of the House by forcing a vote on first reading, which is nearly unprecedented, why their support across the country is disappearing so rapidly.
What we have seen in the arguments presented in support of this question of privilege today I suggest fall apart when one recognizes that the Members opposite are, at the same time, riding two horses which are going off in two directions.
On the first horse, Members are arguing that the precedents, conditions and indeed the privileges of the House clearly establish that Bills may not be disclosed outside the House until they are tabled here first. Then, on the second horse, they are arguing that the lock-up rules were violated.
Well, recognizing that there are such things as lock-up rules indicates, I believe, that the first horse is going nowhere. Concerning the suggestion that there is a violation of privilege when a draft bill or proposed Bill which has not yet been first read is made public elsewhere, there is no such rule.
I look at the section referred to by the Hon. Member for Hamilton Mountain (Mr. Deans) at page 221 of Beauchesne's Fifth Edition, which he argues established that a Bill, draft Bill or proposed Bill may not be revealed elsewhere before first reading. The language that he cited says nothing of the kind. It simply says that the purpose of first reading is to allow any Bill to be introduced, printed and distributed so as to give Members an opportunity to study it. It says nothing at all about prior disclosure of a draft Bill on undertakings or indeed without undertakings.
Privilege-Mr. S. Robinson


Ian Deans: Who could authorize distribution other than the House?


Robert Phillip Kaplan: Yesterday, at page 527 of Hansard, he referred to a precedent of Mr. Speaker Jerome and said that Mr. Speaker Jerome found that prior disclosure in a lock-up "did violate the practices of the House of Commons". I am quoting the Member opposite. If that reasoning and statement appeals to you, Mr. Speaker, I urge you to read what Mr. Speaker Jerome really did say, because he said nothing of the kind.
On the second horse, about whether the lock-up was properly held or not, I do not see how one can argue that privilege was violated by prior disclosure and at the same time argue that a lock-up can exist provided that the Members' concept of proper rules are followed. If one looks at the situation in the lock-up, I do not think anything can be found therein that violated the established privileges or amounted to a contempt of Parliament. In fact, there was a lock-up. In fact, at noon yesterday draft copies, advanced proposed copies of what was proposed to be first read, were shown to parliamentarians.
I draw to your attention that the document given to them was not the document produced here following first reading. The document given to them showed clearly on it "Confidential until tabled in the Commons". That does not appear on the first read Bill, if the Hon. Member wants to make the argument that that is the Bill which should not have been disclosed anywhere in advance. But even on that point I see nothing in the rules or in the precedents he cited which would not allow that.
I want to refer also to the fact that the Hon. Member for Burnaby (Mr. Robinson) admitted, namely, that he himself was expecting to get an advance copy of the Bill on the basis of the mutual respect which exists across this floor, that he asked for it and he indeed got it. His colleague, the Hon. Member for Hamilton Mountain (Mr. Deans), was arguing against that practice and at the same time the Hon. Member for Burnaby was insisting on that practice. He was asking that he be given a copy before the Bill was made public here. In other words, I think the whole case which the NDP has put forward falls apart.
I would like to deal, and I think I must, with the other question of privilege raised by the Hon. Member for Burnaby. I think I wrote down accurately what he said. He said that "as a Member of Parliament he has an absolute right to go anywhere, to have full and untrammelled access to parliamentary precincts-


Svend Johannes Robinson: Subject to the Speaker.


Robert Phillip Kaplan: Subject to the Speaker. I would submit to you, Mr. Speaker, that that is a ridiculous proposition and that just a little bit of examination shows that. My office is in the parliamentary precincts. The Hon. Member's office is also. Is the Hon. Member suggesting that he has a perfect right of

January 19, 1984
Privilege-Mr. S. Robinson
untrammelled access into my office? How about meetings of caucus and Cabinet?


Some Hon. Members:: Oh, oh!


Mr. Keeper:: That is specious.


Robert Phillip Kaplan: The Hon. Member indicates they are in a different category. Let me point out to you, Mr. Speaker, and remind you that Members have the right to reserve rooms in this precinct for such purposes as discussion that relate to their duties as Members of Parliament. I reserved a room. I had a purpose for which that room was wanted. I would suggest it is my privilege as a Member under that well established practice of yours, Mr. Speaker, of allowing Members to reserve rooms, to invite people to those rooms whom I want to invite-not just any Member of Parliament who hears about that meeting and thinks he would like to come to it-I had a specific purpose in mind. It was a valid public purpose. I think a lock-up-and I want to say a word about lock-ups-is very much in the public interest. To suggest that the purpose of the lock-up was to manipulate the media is inconsistent with the high standard of the media in this country. It is also inconsistent with what happened in that room.
1 did not attend. There was no lecture or brainwashing sermon. What was done, incidentally, was done at the request of many members of the media. I understand that 35 members of the media attended. The purpose of the lock-up was to give them a chance to read the Bill in time for their deadlines, so that they would be prepared to report responsibly on it. Officials were present so that questions could be asked and answered, but there was no attempt to brainwash the media of Canada. I think the Hon. Member makes an unworthy suggestion in suggesting that even had we wanted to brainwash the media, which we did not, we would have been able to achieve that result. It was purely and simply a response to media requests with complicated legislation, with a great deal of public interest, with imminent deadlines to be able to serve the Canadian people as the media are required to do. The Hon. Member opposite is not the only one with the responsibility to serve the public.
He received his copy of the material at virtually the same time as the media-perhaps with a minute or two difference, because I did not know where he was. All of the discussions we have had about secrecy, rules, undertakings, barring the door and seeing who goes in the room go to undermine any suggestion that there is anything wrong with sharing the contents of legislation, as I did on a confidential basis for very good reasons before first reading of this legislation.
Let me say that if anyone has a question of privilege arising out of yesterday, it was me. I followed your rules, Mr. Speaker. I reserved a room. I had a valid purpose in mind for it and found that, because an uninvited person, an outsider to that event, chose to come and sit in, I was not allowed to use it. How would the Hon. Member react if he reserved a room, as he must do from time to time for his own purposes, and found
other Members of Parliament who had not been invited coming and sitting in the room?
I close by simply asking that if privileges are to be looked at, this privilege to reserve a room and use it for valid public purposes without interference be sustained. Let me reiterate also that the New Democratic Party has found one way or another to refuse to face up to the difficult problem of national security. Members of the NDP have chosen to attack stridently anything that has been put forward rather than telling the Canadian people, their diminishing group of supporters across the country-


Ian Deans: You could not even make a room secure, for heaven's sake. You could not keep the people in the room.


Robert Phillip Kaplan: -whether or not they support separation or whether or not they support the review committee. What mandate would they recommend to avoid all these difficult issues? The New Democratic Party has contented itself with a strident attack on anything, and I believe its Members are discrediting themselves by what they are doing.


Mr. Speaker:: The Chair does not intend to hear a large number of further representations in the circumstances. I invite Hon. Members to be brief. The Chair will recognize the Hon. Member for Hamilton Mountain (Mr. Deans) and the Hon. Member for Regina West (Mr. Benjamin). Hopefully then the Chair will render a decision.


Ian Deans: I will be very brief, Mr. Speaker. The Minister indicated that yesterday I made reference to a representation made to Mr. Speaker Jerome, and I did. I said, to paraphrase it, that Mr. Speaker Jerome had agreed that the matter was of some concern. Those may not be my exact words. Let me read what I based that on. It is one sentence. Mr. Speaker Jerome said:
The Hon. Member has certainly raised a valid point as to conditions that ought to surround this kind of lock-up in so far as Members are concerned.
That was the statement to which I was referring. I said there must be some way to keep Ministers from doing what even Mr. Speaker Jerome recognized was certainly stepping on, if not over, the bounds of what was acceptable.


Mr. Les Benjamin (Regina West):: Mr. Speaker, the submission of the Solicitor General is extraneous to the point of the question of privilege raised by my colleague from Hamilton Mountain (Mr. Deans). It is too bad that you must decide on this issue in the early days of your occupancy of the highest office of this place. However, I want to submit to you that the point here is the supremacy of Parliament. No one except a Member of the executive council with his oaths of secrecy and Cabinet secrecy has a right to receive, be informed or be briefed about, legislation before Members of Parliament receive it, but, more particularly, before a Bill has received first reading in the House of Commons and before the House of Commons, under your aegis, Sir, has authorized the publishing and printing of that legislation. That is the question. No one else, I repeat, no one should be privy before first
January 19, 1984

reading. I object to this further erosion of the supremacy of Parliament by holding briefing sessions for the benefit of the press, who I assume the Minister is assuming are incapable of doing their homework once they have the legislation. They are even more incapable than Members of Parliament who have to do their homework after they get the Bill.


Robert Phillip Kaplan: They asked for the lock-up.


Leslie Gordon Benjamin: The press should be in no better position than Members of Parliament. If they cannot go through a piece of legislation and write their own stories without help from the Minister or somebody else, that is too bad. Maybe it shows up some incompetence in the press gallery. No one has the right to receive a briefing before first reading. I submit that even budget lock-ups are improper. The Minister of Finance can brief the press or anyone else he wishes after he has presented his budget speech or after the House of Commons or the Chair has authorized a Supply motion.
After legislative measures have been presented to Parliament, then and only then can the Solicitor General (Mr. Kaplan) or any other Minister hold a briefing session or whatever. It should be after, not before, a piece of legislation has been presented to Parliament. When he talks about the question of privilege being invalid, 1 say to you, Sir, it is invalid for a legislative proposal to be presented to anyone outside the Chamber prior to its receiving first reading in the Chamber. It is invalid, it is a violation of the Minister's oath of Cabinet secrecy, it is a violation of the House, and it is a violation of the supremacy of Parliament.
1 submit, Sir, that after considering the matter you must rule so that this will never again happen. As far as I am concerned, it should not even happen in the case of a budget. They can be briefed all night long and the next morning after a budget. Certainly there is no excuse for briefings of the press or anyone else prior to legislation being presented in the House for first reading, if Parliament is to remain supreme and Members of the Chamber are to have the first opportunity on legislation brought forward by any government.


Mr. Speaker:: The Chair would first like to deal with the matter raised by the Hon. Member for Burnaby (Mr. Robinson). There is a precedent in the ruling by Mr. Speaker Jerome relating to the present Hon. Member for York-Peel (Mr. Stevens) who had exactly the same kind of complaint about being excluded from a so-called lock-up. 1 cite from the ruling of Mr. Speaker Jerome on November 27, 1978, wherein he said:
There are several members who may want to contribute to this discussion, but I would like to leave it for a time because it seems to me that the Hon. Member has raised a point which might have a serious procedural difficulty in that since he, or any other member, does not have to go to the lock-up at all, it is difficult to tie it to a question of privilege, thereby establishing that somehow the member is prevented from doing something by the condition laid down surrounding a particular even when, in fact, the hon. member obviously does not have to go there at all if he does not want to do so.
Privilege-Mr. S. Robinson
The Solicitor General (Mr. Kaplan) said that the Hon. Member for Burnaby was in the category of uninvited guest to a meeting at which he was not welcome. The suggestion that the Speaker can undertake to control access to meetings held by parties of different persuasions in the parliamentary precincts is one which the Chair cannot accept.
The Chair obviously recognizes that the parties represented in this House may from time to time request rooms. They may or may not choose to invite members of the press. They may choose to invite their own supporters or include or exclude their own supporters. They may on occasion include members of other Parties or not include them. That is not a matter for the Speaker to decide.
Having said that, the Chair is aware that there is a problem. The Hon. Member for Hamilton Mountain (Mr. Deans) has very well touched upon a problem. If he wants to establish some guidelines, in the opinion of the Chair he should do so by a substantive motion or notice. He has not, in the opinion of the Chair, made a case for priority of debate under privilege.
The Chair would also like to make another observation. The process of legislation is one that is evolving. Prior to the introduction of a Bill by a private Member, there are any number of instances in which private Members have circulated what they allege to be the draft they intend to introduce in the House. The Chair cannot accept the principle that what is done in the case of a private Member's Bill is different in principle from any other piece of legislation.
The Chair has to observe that the trend in modern government, contrary to what the Hon. Member for Regina West (Mr. Benjamin) is saying, is in the direction of consultation prior to budgets, prior to legislation. The process of consultation is an important part in the development of proposals if they are to succeed in the public interest.
The Chair asks one question: At what point does a Bill become a Bill?


Ian Deans: After first reading.


Mr. Speaker:: Then it cannot be a Bill or a public document prior to first reading. All it can be is a draft which the Minister, the proposer, the private Member or whoever is concerned, may or may not intend to introduce. There are any number of situations where drafts of Bills have been circulated and no further action has been taken with regard to them. Surely the Chair cannot be placed in a position of determining whether a document or a piece of paper, or whatever it is-it is certainly not a document of the House-can or cannot be circulated, or that the Speaker in some way should regulate the persons to whom such a document could be circulated.
1 invite Hon. Members to reflect again upon the point raised by the Hon. Member for Hamilton Mountain. It was raised by Mr. Speaker Jerome in the ruling to which I referred. There is a need for guidelines. Nowhere do I have any guidelines on what constitutes a lock-up. If Hon. Members want to produce some guidelines, some rules, as to the procedures to be followed in such circumstances, the Chair would very much

January 19, 1984
Point of Order-Mr. Nielsen
welcome them. The Chair would invite the Hon. Member for Hamilton Mountain, or any other Member, to take the device of a substantive motion and have a referral. In the circumstances, regrettably the Chair cannot do so as a matter of privilege.


BUSINESS OF THE HOUSE
Erik Nielsen: Mr. Speaker, the Government House Leader has informed me that he has an unavoidable meeting which he must attend now. He has asked me to put off the usual Thursday question until five o'clock, and I have agreed to put that question at five o'clock with the consent of the House.


POINTS OF ORDER
Erik Nielsen: Mr. Speaker, I have two brief points of order. The first concerns the remarks of the Chair yesterday in connection with the Ways and Means motion and the Royal Recommendation. Now that I have had an opportunity to examine the comments of the Chair on the legislation, we provide our consent here and now for the Recommendation attached to Bill C-8 to remain on the Notice Paper for the 48 hours required. Then of course the House officials will print the Recommendation in Votes and Proceedings.
I suggest with respect that in future if the Chair has something like this coming up, if the House Leaders were given advance notice, possibly we could react at once to it.


MR. NIELSEN-PROCEEDINGS FOLLOWING FIRST READING OF BILL
Erik Nielsen: Mr. Speaker, my second point of order concerns yesterday's proceedings. I do not intend to raise it in any substantive or sustained way, but because of the undesirability of the matter at some future date possibly being taken as a precedent, I thought I should register a caveat now. While this particular incident is of no significance, nonetheless a precedent based upon yesterday's record on a more substantive issue in the future might become more serious.
You will recall, Mr. Speaker, that after the vote last night you said:
I declare the motion carried.
Then there appears the following notation on page 531 of Hansard:
Bill read the first time and ordered to be printed.
Then it continues:


Mr. Speaker:: When will the Bill be read the second time?


Some Hon. Members:: Now.


Some Hon. Members:: At the next sitting of the House.


Mr. Speaker:: Agreed. At the next sitting.
Then there appears my intervention:
Mr. Speaker, surely after the vote and it being ten minutes past six, no further question can be put. With great respect, you cannot do that.
I suggest that the more proper course to have been followed would have been to put the question as to when the Bill will be read a second time today rather than yesterday.
I will not make a big issue of it because it is not significant and does not affect our proceedings in any significant way. However, I would not want it to be used as a precedent should some matter arise in the future which has a great deal more significance and importance than this one.


Mr. Speaker:: The Chair would like to express its appreciation to the Hon. Member for Yukon (Mr. Nielsen) for the positive way in which he has put forth the matter. Such matters call for judgments by the Chair on very short notice. The Chair has, however, relied on Citation 722 of Beauchesne's, which reads:
Appointment for Second Reading
When the House has agreed to the first reading of a bill, the Speaker at once proceeds to ask: "When shall the bill be read a second time?" The answer is generally: "At the next sitting of the House." The bill is placed on the Order Paper, in its proper place, for a second reading at a future time. It is purely formal and is proposed with the object of placing the bill on the agenda for a second reading at which time all discussion can more regularly and conveniently take place.
This was the principle guiding the Chair at that time. The Chair takes note of the representation by the Hon. Member for Yukon, and in particular the helpful way in which he has raised it. I call to the attention of the Hon. Member for Yukon that in the opinion of the Chair, the Chair was going through a formal, almost a routine proceeding. The Chair will, however, make note of the representation that has been made.


Erik Nielsen: Mr. Speaker, if the Chair would allow a one-sentence observation, my whole point is that the House was not "sitting" at the time the second question was put.


Ian Deans: Mr. Speaker, there are always grey areas. I read the same citation as you and I came to the same conclusion. It shows how people reading the same thing do not necessarily always arrive at the same answers.
I want to say, by way of unanimous consent to the inclusion of the Royal Recommendation, that I agree with the comments made by the House Leader for the Official Opposition.


Mr. Speaker:: Is there unanimous consent?


Some Hon. Members:: Agreed.


MR. HAWKES-READY AVAILABILITY TO MEMBERS OF HANSARD COPIES
Mr. Jim Hawkes (Calgary West):: Mr. Speaker, I rise on a point of order. I apologize for taking a brief moment of the House. When I was first elected, we had copies of Bills and Hansard under our desk. That situation has since been cleaned
January 19, 1984

up a bit so that we are less cluttered. Yesterday and again today I requested copies of Hansard for the month of October just past. I have been informed that those copies are now kept in the Confederation Building and that it takes 15, 20 or 25 minutes to arrive to a Member who happens to be in his or her place in the House of Commons. 1 was wondering whether, in your capacity as administrator, you could see that copies of recent Hansard are kept in a location that is much more available to Members of the House so that, as we do our work in this Chamber, we can have access to the written record.
Mir. Speaker: The Chair will make careful note of the representations of the Hon. Member.



ROUTINE PROCEEDINGS


Mr. Gus Mitges (Grey-Simcoe):: Mr. Speaker, I am pleased to present a petition from constituents in my riding of Grey-Simcoe and surrounding areas who are deeply concerned and distressed by the actions of the provincial Governments and the federal Government regarding the ever-increasing taxation applied against the distilling industry. This has resulted not only in declined sales but a decrease of 2,000 jobs has already taken place in the industry.
The petitioners are firmly against these unjust increases in federal excise duty and sales tax on distilled spirits, and request that the taxation system be properly and sensibly revised to represent a reasonable and common-sense approach to this very important problem.
* *
*
Order Paper Questions


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
John Leslie Evans: Mr. Speaker, the following questions will be answered today: 69, 87, 123 and 128.


Mr. Howie: How many lawyers are employed by the Department of Veterans Affairs?


Hon. W. Bennett Campbell (Minister of Veterans Affairs):: Department of Veterans Affairs	1 Justice Department
Bureau of Pensions Advocates	39
Pension Review Board	0
Total	40


Mr. Howie: How many persons engaged in public relations, media relations or publicity are employed by the Department of Indian Affairs and Northern Development?


Hon. John C. Munro (Minister of Indian Affairs and Northern Development):: The Department of Indian Affairs and Northern Development has a total of 45 employees engaged in public relations, media relations or publicity.


Mr. Stewart: Is there a Fashion Design Assistance Program (FDAP) and, if so, for each fiscal year since its inception, what amount was spent under the Program?


Hon. Ed Lumley (Minister of Regional Industrial Expansion):: Yes, a Fashion Design Assistance Program (FDAP) did exist from 1971 to 1982. The costs for each fiscal year since its inception are as follows:



DIVORCE ACT


[Stage Direction]
1971-	72-S 60,000
1972-	73-S 58,000
1973-	74-$104,000
1974-	75-$202,000
1975-	76-$199,000
1976-	77-$202,000
1977-	78-$222,000
1978-	79-$222,000
1979-	80-$220,000
1980-	81-$281,000
1981-	82-$229,000
1982-	83-$ 33,000
Hon. Mark MacGuigan (Minister of Justice) moved: for leave to introduce Bill C-10, an Act to amend the Divorce Act.


[Stage Direction]
Motion agreed to, Bill read the first time and ordered to be printed.
Mr. Speaker:: When shall the Bill be read the second time? Mr. Evans: At the next sitting of the House.


Some Hon. Members:: Agreed.



BUSINESS OPPORTUNITIES SOURCING SYSTEM

Mr. Stewart: Is there a Business Opportunities Sourcing System (BOSS) and, if so, for each fiscal year since its inception what was the cost to the taxpayer for the maintenance of a computer listing of Canadian manufacturers, international trading houses and services under the system?


Edward C. Lumley: Yes, a Business Opportunities Sourcing System (BOSS)

January 19, 1984
Supply
does exist and the cost of maintaining this list since its inception is itemized below:
Year	Person/Years
Non-salary Dollars
1980-81	9
1981-82	9
1982-83	9


Mr. Speaker:: Shall the remaining questions be allowed to stand?


Some Hon. Members:: Agreed.


Mr. Speaker:: The questions enumerated by the Parliamentary Secretary have been answered. Shall the remaining questions be allowed to stand?


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Beatty:
That this House condemns the Government for its contempt for the taxpayers of Canada, which it demonstrates by the creation of a taxation system in the form of the Income Tax Act that is increasingly incomprehensible for individual taxpayers and, by its failure to end capricious and unfair practices of the Department of National Revenue.
courtesy in this instance. I know him to be a friend and a courteous Member at times. I find his action now to be typical.
Today's debate deals with a controversy that has been swirling around Revenue Canada for about a month. It involves some actions by some over-zealous managers in district offices. It also shows in an interesting way that Parliament works. We have seen some determined concerns on the part of a few opposition Members, well informed and determined concerns that have been reflected in Question Period and in debate. We have also seen proper and immediate response by a responsible Minister to begin to solve the problems that have been identified.
The difficulty is that we are dealing with the conduct of over 10,000 government employees who are responsible for collecting taxes based on the results of over 15 million tax returns. We are dealing with human behaviour. That human behaviour is complicated by two additional basic facts. On the one hand we have people in a government Department with extraordinary legal powers. They must constantly be watched and kept under supervision. On the other hand we have people, quite understandably, who do not always want to pay their taxes either in whole or in part.
In today's debate we have heard some terrible stories. We heard about an 83-year old widow, a rancher and a doctor who had been embarrassed in his community. In some ways these stories would make you weep. In the hands of powerful and persuasive orators like the men and women in this House, these tales are indeed persuasive. I have my own stories. I have a story of a mother whose children were forced out of school by the tax department. Can you believe that? I have a story of a businessman almost driven to the edge of bankruptcy. If we take a look at my stories, and I suspect the stories on the other side, we begin to see that there are two sides to every story.
And the amendment thereto of Mr. Riis:
That the motion be amended after the words "individual taxpayers" by inserting the following:
"and which favours big business and upper income earners at the expense of
small business and average working Canadians."
Mr. Speaker:: The Hon. Member for Cariboo-Chilcotin (Mr. Greenaway).


Douglas Glenn Fisher: Mr. Speaker, if you check the speaking order, I think you will find it is the turn of Members of this side, and I was on my feet at the same time as the Hon. Member.


Mr. Speaker:: With the consent of the Hon. Member for Cariboo-Chilcotin. The Chair was perhaps inadvertent.


Douglas Glenn Fisher: Mr. Speaker, I am grateful to the Hon. Member for Cariboo-Chilcotin (Mr. Greenaway) for his courtesy. I asked for this opportunity to speak because there are quite a few Members on our side who want to speak and we would lose a turn if I did not ask. I therefore thank him for his
Take the case of my constituent who is a mother who had her children taken out of school. What does that really mean? When I found out about it I learned that the family had a huge income tax bill. They just simply had not paid their taxes. They also had two cars and lived in one of the most luxurious neighbourhoods in my city in a marvellous house. They sent their children to everything; ballet lessons, swimming lessons, music lessons, everything that it was possible to send them to. They also sent them to private schools and paid thousands of dollars annually above and beyond their public municipal taxes for their education. Then the tax department came along one day and suggested that these people might want to pay their income tax at some time. That certainly made the mother in that family very angry. She wanted to know from me if she was supposed to take her children out of school. I had to say, "Madam, we do not care what you do. Please just pay your taxes. If you have to take your children out of private school and send them to the very good schools in the public system, please do it. It is your choice. But you cannot finance your life by not paying your taxes." It is plain

and simple. Mr. Speaker, in the hands of a powerful orator that would sound like inhumane treatment indeed.
I had a case this summer of a businessman in my area. He claimed that the tax man had almost driven him into bankruptcy. 1 work on behalf of the people in my area and I was concerned. 1 wanted to know what we were doing that was so terrible. I found out that his business was virtually bankrupt anyway. He had kept it alive by taking the money paid by his employees on their employee deductions and using that money to pay other creditors instead of paying the income tax department. In effect he was robbing from his employees to keep his own business alive. In the hands of a powerful orator that again would be a terrible story. If you looked a little closer you would see, as in the first case, that there was indeed a common sense reason for the actions of Revenue Canada.
I contend, Mr. Speaker, that those two samples which I have just given are typical of instances which happen time and time again. Every story has two sides. Revenue Canada is not a malicious force alive in the land. Its employees are not incompetent. Its Minister is not insensitive. In fact, Mr. Speaker, I contend that Parliament is not the proper place to raise these individual cases. We heard today about an 83 year old widow. Who among us wants to stand in this place and ask the tough, common-sense questions that might reveal some of the motivation behind that? None of us wants to do that. It is not proper to bring that kind of example into this forum, yet we hear it day after day in Question Period and in debate. It is not proper to manipulate individual lives and cases in that way.
We have to recognize, Mr. Speaker, that there are many people similar to the two examples I cited. They are people who owe the Government of Canada some money. They are people who have other priorities besides taxes. They are people who use their tax money to pay for these other priorities. When the collection department finally comes to the door, they are people who get very angry indeed. We have all heard similar cases and we have all seen people who bring trouble onto themselves. I suggest that we have to treat these cases with a degree of compassion but also with a degree of skepticism.
We have to have some skepticism as well about the political charges. I am going to quote directly from the Montreal Gazette two things that have been said recently. This is a direct quote from the January 19 issue of the Montreal Gazette:
Beatty and others have said they will continue their assault until Bussieres accepts responsibility for his department's actions.
Mr. Speaker, I contend that the Minister of Revenue has always taken his responsibilities and acted to cored a problem when it arose in this particular case. I will quote again from the Montreal Gazette. It reads:
Speyer accused Bussieres of behaving like a Pontius Pilate by trying to wash his hands of the actions taken by his subordinates.
Mr. Speaker, I say that the Minister of National Revenue (Mr. Bussieres) has constantly risen in this House trying to be fair to his employees and to taxpayers. It is the kind of
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incendiary language that we have heard that has created more trouble than the Minister's actions. The Minister is not washing his hands. The Minister is not trying to blame other people. The Minister is not evading his responsibilities. His statements and actions in this House have indicated that very very clearly.
I will quote a few examples from Hansard of places where the Minister has stated his principles and then acted to try to solve the problem. On November 29, the Minister said:
We do not use methods that are inequitable or unfair, and in fact, we are guided by the principle that all Canadian taxpayers should be treated equitably.
He also said that day, commenting on his Department's work:
-the main concern of the employees of my Department is to perform their duties while dealing equitably and fairly with all Canadian taxpayers.
That was a signal about his principles, not only to us in the House of Commons but to his Department.
On December 19, as the Opposition Members quite rightly provided evidence of their concern, the Minister rose and said:
I was informed that certain directives had been given, and that as soon as the immediate supervisors of those who issued the directives were informed of the situation, they asked for their withdrawal because they did not comply with departmental policy. At that time I asked the same officials whether there were other locations where similar measures had been implemented, and I was informed that there were none.
In short, Mr. Speaker, as soon as the Minister identified the problem he started to act to solve it.
On December 21, again in Hansard, the Minister said:
Madam Speaker, as 1 have indicated to the House before, it is not departmental policy to set quotas for amounts to be assessed by auditors of the Department of National Revenue.
Further on he stated:
1 informed the House that there was no quota system. I have also informed the House that to my knowledge, an unfortunate initiative has been taken and was immediately stopped by senior departmental officials.
He went on to say:
I gave orders to prepare a directive-and this is being done-to ensure, if such unfortunate initiatives had existed or should exist, that they be stopped immediately.
That is an unequivocal assurance to the House. On the same day he went on to say:
To this day I have made every effort to ensure that the Income Tax Act is administered equitably, and that measures taken by officers in performing their audits .. . ensuring that people who, because they have no choice, pay their taxes in full because they are deducted at source, should not have to bear an additional burden because others can take advantage of the system with the support of Opposition Members.
On January 18 he gave us his assessment of the situation at this point as follows:
I would like to point out to the Hon. Member that if I had the slightest suspicion that the system has been odious, that is to say, that it had caused excessive recovery of monies from taxpayers, 1 would take further action.
However, being aware of the established practice for carrying out audits and issuing tax notices, I have no reason to harbour any doubts on this point.
An article in the Globe and Mail of January 18, made the following reference:

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-a meeting yesterday between union and senior Revenue Canada officials ended with a joint statement saying both sides are satisfied there is no quota policy within the department. Union representative Gordon Gillespie said he is satisfied that the practice has stopped in cases where local managers have used quotas.
Further on the article stated:
Mr. Gillespie, president of the 13,000-member taxation component of the Public Service Alliance of Canada, said he is satisfied quotas have never been a Government policy.
"There's no deliberate policy of Revenue Canada to go out and harass taxpayers," he said.
Mr. J. R. Robertson, Director-General of the Department's compliance division, said, according to the article:
"There are supervisors who are more off-the-line and aggressive on their own,"
He went on to say:
-the department's position has always been that it is impossible to set quotas on how much money auditors should recover in a given time period because they have no control over the files they receive.
The Minister has gone one step further with his announcement in the House today to the effect that he is initiating a study of procedures in his Department. That is worth noting. He is going to look at the adequacy of the Department's services and at its sensitivity, particularly in the areas of auditing and assessing. A press release notes several areas where the Minister intends to study the Department's activities, its organizational arrangements, its operating policies, communications, management information systems, operating procedures and standards, and training and management programs. The Minister has recognized an isolated problem and has had considerable help and advice on it from the Opposition. I am sure he would prefer it had been offered more quietly, but he took that advice and moved to stop the activities of some over-zealous individuals in his Department. He heard what ordinary members of the Liberal caucus and those across the hall had to say. He paid attention to our advice to him and has initiated a study of areas where the Department can be improved. To this end he has asked an impartial person from the outside to look things over and give an opinion. He has stressed that the report will be given to him in stages for immediate and speedy action.
There have been problems with the quota system, and they are especially important in a democratic society where we have to respect the rights of the individual and to respect due process. It is the job of the MP to be sensitive to people who are trampled on or abused. We not only need a good system, as the Minister has undertaken to provide, but we also need the input, sensitivity and individual attention that ordinary Members provide. In my opinion, that is the crux of this whole matter. We have seen the House act properly and we have seen the Minister act properly. As a result of that, we will see an improved Department and greater sensitivity on the part of public servants to their responsibilities and to the people they serve.


Gordon Edward Taylor: Mr. Speaker, I would like to put a question to the Hon. Member. I wanted to put it to the Minister this morning but was denied the opportunity by the refusal of the Liberal side to have the questions extend for two or three minutes.
In 1976 a ranch family in my riding filed tax returns and was assessed. I believe the taxes were paid. A little later a reassessment was done by Mr. Peter Ruzman, who levied no additional tax. Some months later the 1976 returns were again reassessed, this time by a Mr. David Innis, and this resulted in the levy of thousands of dollars in additional taxes. A reassessment of the reassessment of the assessment was then made by Mrs. Kay Thompson who found that only half the taxes assessed by Mr. Innis on the second reassessment were proper.
In other words, we had the first assessment, then a reassessment by Ruzman who found no additional taxes due, then a reassessment by David Innis who found thousands of dollars of additional taxes due, and then another reassessment of the reassessment of the assessment by Mrs. Thompson who said that Mr. Innis was wrong and only about half the taxes should have been levied.
Does the Department condone this type of harassment? Every time there is a reassessment the Department requires a guarantee, so you go to the bank and pay additional money for the guarantee assuring that you will pay any taxes that are levied. This is unfair. These reassessments, reassessments, reassessments destroy confidence in the Department. When are we to know it is finalized when reassessments are ordered as is illustrated in this case?


Douglas Glenn Fisher: Mr. Speaker, I am sorry but I am not going to comment on that case. I congratulate the Hon. Member for his concern. I have heard him raise other tax issues in the House. He is obviously an eloquent and concerned spokesmen for his constituents and that is his job, but I do not think this is the proper place to discuss that kind of individual case. I urge the Hon. Member to send the information to the Minister and to deal with him privately, as he should.


Howard Edward Crosby: Mr. Speaker, I listened with interest to the Hon. Member's speech. I understood most of what he said but I found some of his points somewhat obscure. The allegation is that officials at Revenue Canada have been guilty of unfair practices in the past and that there ought to be a reaction to this problem and action taken.
Is the Hon. Member saying that there were no unfair practices? In that case he would defend wholeheartedly the officials of the Department. Or is he saying that there are unfair practices but that nothing should be done?


The Acting Speaker (Mr. Herbert):: The Hon. Member for Mississauga South.


Douglas Glenn Fisher: Mississauga North, Mr. Speaker. The Hon. Member for Mississauga South (Mr. Blenkarn) is a Tory and a great man; I am not a Tory nor a great man. I live in the north quite happily.
January 19, 1984

I heard the Hon. Member's complaint but I do not know how he could draw that opinion from the comments I made. I believe that the quota system was an improper activity inside the Department. Clearly the Minister did not want it to continue either; clearly, the Minister took action; clearly, the union took action; clearly, senior departmental officials like Mr. Robertson took action, and clearly, if all these people are taking action they do not want this system to continue. The Minister has said that time and again in the House in answer to questions from the Hon. Member for Wellington-Dufferin-Simcoe (Mr. Beatty), from the Hon. Member for Cambridge (Mr. Speyer) and other concerned Members. The Minister did not approve of the quota system and he does not want the practice to continue in the Department. He has made that clear to anyone who will listen to his statements.
I have quoted statements on November 29th, December 19th, December 21st and January 18th, all from Hansard, all sitting on the Hon. Member's desk. All he has to do is to open up Hansard to see them. I believe the Minister has taken his responsibility seriously. He has acted properly to end an improper practice. He has then gone beyond that to invite outside opinion and outside study of his Department in order to see if there are other things which need to be improved. We have heard lots of opinions from Hon. Members about areas which should be fixed. Let us then send those opinions along to the person doing the study and try to back it up with some evidence, and not just hot air, which we have quite often here.
The Hon. Member asked me what 1 think. I think the quota system should not have been in place in the first instance, and I believe the Minister was right to move against it and so were his senior departmental officials. I believe it was an isolated series of cases which the Minister took in hand and ended.


Nelson Andrew Riis: Mr. Speaker, I have a question for the Hon. Member along the same line of questioning. Something which has become perfectly clear is that a number of officers within the Department of National Revenue have acted in a most inappropriate way by imposing quotas on their own initiative and, in some cases, as I see it, have made it very difficult for the Minister by, perhaps, not passing along the appropriate information. Does the Hon. Member feel that the Minister, as well as bringing in an independent study group to examine the situation, should take some punitive action against those officials who have brought so much hardship on selected Canadians in selected parts of Canada?


Douglas Glenn Fisher: Mr. Speaker, 1 refer the Hon. Member to yesterday's Hansard where the Minister talks about that issue of hardship. I feel it puts the question in some perspective. He sought and received assurances that the damage from this was not punitive. It was a practice of which he did not approve but, as he said yesterday, he does not believe that taxpayers were asked to carry odious burdens because of excess demands by individual assessors. The Minister has made that statement, and 1 refer the Hon. Member to it. I believe that the Minister
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has given us the assurances we need, that there has been no odious burden imposed on any taxpayer.


Gordon Edward Taylor: Mr. Speaker, the Hon. Member said that there is no place in this House for questions such as I just asked. I was dealing with a principle of reassessing and reassessing and reassessing. This is a practice which is going on. There are scores, perhaps hundreds of people across Canada, bleeding from this practice. It is a sordid principle. Surely you can deal with the principle if you do not want to deal with the case. I say this is a proper place to discuss this type of thing, certainly from the point of view of the principle. I hope that the Hon. Members on the other side of the House will not condone this practice of reassessment after reassessment after reassessment. It is wrong and it should be stopped.


Douglas Glenn Fisher: Mr. Speaker, I believe there are approximately 40,000 reassessments every year out of 15 million tax returns. Clearly that is not excessive. In a system like ours we must have the capacity to assess and to double-check a taxpayer's information. That double-checking is not the key to the system. The key to the system is the original comment and return from the taxpayer. That is the key, the trust and the self-assessment between the taxpayer and the Government. However, the Government must have the right to police that or to act as a referee and assess it.
I believe that the appeals process on this reassessment is currently too complicated, and I would think that we should simplify the appeal process and make it more accessible, especially for the small taxpayer. We should also have outside people involved in the decisions on the appeals so that we could get some third party opinion. That would avoid the kind of problem the Hon. Member has described for us. I believe we need to approve the appeal system, but we cannot possibly end the first step, which is the assessment system. We cannot muddy that water. However, I believe we could improve the appeal system.


Mr. Lome Greenaway (Cariboo-Chilcotin):: Mr. Speaker, I would like to make one short remark on the quota system to the Hon. Member who was speaking. We have not yet investigated the fact that there are quotas in the Department which does the collecting. That is something I hope the Minister will look into and remedy, because we know that exists as well, even though he would probably deny it.
My riding is located in central British Columbia, in the cattle ranching country, and it has been that way for a long time, at least since the Gold Rush days of the 1800s. There are some large ranches and, of course, many small family farms. Most of these originated as homesteads and were literally hacked out of the bush with a lot of hard work. Even today there are still free-spirited and hardworking people attempting to get into farming and ranching by starting, buying and clearing land as they can afford it, and working out to pay for the high cost of this independent way of life. Because of difficult economic times, we have seen an increasing number of owners of established operations having to work at off-farm jobs to supplement their incomes in order to meet their obliga-

January 19, 1984
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tions. This has not only happened in my riding but is common across the country. The Minister of Agriculture himself has stated that 80 per cent of the farmers in his constituency have supplementary incomes.
Raising cattle, or for that matter any other species of livestock, is never easy. Farmers are continually faced with difficulties and often incur losses. Cattlemen, for instance, can suffer losses in a hundred different ways, a few of which include disease, parasites, poisoning, predators, rustlers, and so on. Losses are taken as a matter of course, notwithstanding that everything is done to prevent them. However, Mr. Speaker, no rancher or farmer in Canada can withstand the plague which has been set upon them recently in the form of Revenue Canada auditors. These predators, these bounty hunters, have caused more despair, more sleepless nights, frustration, hopelessness and heartbreak than disease, coyotes, bears and thieves all rolled into one.
Federal tax legislation, under Section 31 of the Act, recognizes three types of farmer; full time, part time and hobby farmer. A full time farmer can deduct all losses incurred from any income earned from any other source. A part time farmer is limited to a deduction of only $5,000 per year, and a hobby farmer is allowed no deductions at all. This is set out in great detail in a very imprecise and ambiguous fashion in Section 31 of the Income Tax Act. The trouble has arisen when Revenue Canada auditors have reclassified or downgraded farmers and have reassessed up to four years in back taxes, plus interest. Of course, this happens with very little warning and the farmer is suddenly confronted with a large tax bill which is to be paid immediately upon receipt. Who could ever foresee this calamity? It results in devastation.
The December edition of The Country Guide publication contains an article entitled "Anatomy of a Section 31 Audit", which was written by a journalist who sat in on a Revenue Canada farm audit. The article puts Revenue Canada in a very good light in saying, and I quote:
Even if your farm has lost money for several years and your off farm job provides a large income, it is still possible to qualify for full-time farmer status under Section 31 of the Income Tax Act.
As many of my constituents have found out in the past year, Mr. Speaker, that may be possible, but Revenue Canada is doing everything it can to make sure that this in fact does not occur. The article goes on to describe a perfectly flawless audit done on a young farmer by a member of the tax department. The auditor who did this audit should indeed be congratulated for being so diligent and so fair to the farmer, although given the amount of attention this issue has been given in the media lately, it is not surprising that the auditor was on his best behaviour with a reporter present.
While I agree that this article demonstrates the way in which audits should be done, there are several ways in which the general tone of this article differs from the descriptions which I have received from farmers in my constituency and from across Canada. For example, in this assessment the auditor took the time while visiting the taxpayer to inspect the farm machinery, buildings and some of the surroundings
before making a judgment concerning the profitability of the business and the intentions of the farmer. There is no doubt, Mr. Speaker, that this is the proper procedure, but in a great many cases which have come to my attention such an attitude appears to be exceptional. I quote from a letter sent to me from a constituent of mine in Quesnel, B.C. She says: "The lady who audited us didn't even want to look at the land or what we had done. She went as far as the barn and then said she didn't want to walk through any more mud." The auditor in question has been the subject of many complaints in my riding. Another constituent writes: "The Government auditor didn't even step outside the house to see where the farm is or what it has". I think most people would agree there is more intended in the stipulation that the auditor visit the taxpayer's farm than simply driving there and back. Yet in some cases that is all that has been done.
There are several taxpayers who believe that auditors, although they took the time to visit the farm, had made up their minds before they even got there. One of my constituents wrote the following concerning the behaviour of the auditor who did his assessment: "At the end of our discussion the auditor handed me a form letter which had been dated and signed even before he came to the farm. I suggested that his decision regarding my farm audit was determined before he came to my farm but of course he denied this. I can only envisage, however, that the income tax auditor had inspected my farm receipts with a biased and predetermined opinion of my farm prospects based on income tax figures he had from 1978 to 1981.
A review of the many letters I have received from farms on this issue clearly shows that tax auditors are not acting in such a way as to uphold the true intent of this part of the Tax Act. Rather than conducting themselves in a professional manner by being genuine in their subjective appraisal of the farm, the auditors are simply making a token appearance at the taxpayer's residence in order to live up to the most basic requirements of the job. In this way, the auditor, indeed all of Revenue Canada, is losing the confidence of the taxpayers who feel they have been reassessed without a thorough examination of the situation. In the Country Guide article, Mr. Speaker, the auditor involved demonstrated a knowledge of agriculture which allowed him to make a fair assessment of the taxpayer's situation. This, too, is something which I and my constituents have found to be lacking in most of the recent audits. The facts are that most of the auditors we have dealt with have a very limited knowledge of farming. In one particular case the auditor did not even know that a cow usually has a calf only once a year. How do you expect an auditor like that to tell you the difference between grades and purebreds? When they get on a horse farm, how would you expect them to tell the difference between a quarter-horse, thoroughbred or an Appaloosa? Or whether it is a good horse or a bad horse? How do you suppose someone with that limited a knowledged of farming could be entrusted to assess the farmer's reasonable expectation of profit?

Throughout the past weeks, Mr. Speaker, the Minister of National Revenue (Mr. Bussieres) has maintained that the tax law must be applied fairly and evenly. I think all would agree this should surely be a necessary principle for tax auditors to follow. However, here again many farmers who have written me about this issue argue that auditors have been exercising discretionary powers in an unfair and often intimidating fashion. Once again 1 wish to quote one of my constituents. I received a letter from a farmer in the process of having his tax position reassessed and he said the following about the advice the Revenue Canada auditor had given him: "He also said that the tax department wouldn't say anything if we pocketed up to $10,000 without claiming it." Of course, Mr. Speaker, one should realize that if you took this advice you could be charged with fraud.
This is not an isolated incident. Several people have said that auditors have told them not to declare some of their income; several others received conflicting advice from different officials within the Department on the most basic of legal inquiries. Here are several quotations from letters which should give Members of the House some indication of the range of abuse auditors have recently demonstrated. This is from a farmer in Kitchener, Ontario: "The appeals division of the tax office in Kitchener has offered to vacate the 1979 reassessment if we withdraw the appeals for the other three years". From a farmer in Quesnel, B.C. I have this: "I asked the auditor if he knew what this was doing to me, if he realized this would bankrupt, us and he said he was aware of that but that his hands were tied and he had no alternative but to recommend that we be put into that category. He explained to me that if I decided to fight this I would automatically be put into the lowest classification for a farmer, which is called a hobby farmer, which would then require me to pay back all losses deducted for the last four years, and to retrieve any of the money 1 would have to go before the taxation review board in Vancouver, which of course would amount to considerable cost to myself'.
In this case, Mr. Speaker, if this gentleman were put in the second category, he would be reassessed $13,700. If the auditor shoved him into the hobby farmer class, that would jump to $33,700. So you can see that these auditors have a lot of power and they can abuse it.
Actions like these on the part of tax officials, Mr. Speaker, constitute nothing less than harassment and intimidation of hard-working and honest Canadians. In many cases taxpayers spoke with auditors on the phone and arrived at what they believed to be a mutual understanding between them, only to find out later that Revenue Canada officials had changed their minds or simply refused to acknowledge what they had previously said. Again I would like to present an example of such a case to the House. I quote the following from a letter sent by a farmer in Quesnel, B.C.: "The auditor informed me at the time that the usual procedure was to provide a letter of credit but due to the fact that we were going to tax court we could forgo the letter of credit. When I talked to him on the 13th he denied saying we didn't need a letter."
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An example of blatant incompetence on the part of tax auditors is demonstrated in a letter from another Quesnel farmer. In this case the tax department reassessed the farm to the status of hobby farm. The farmer tells the rest of the story: "We then sent our appeal letter on March 30. On May 3 the auditor phoned and said they had reviewed our case and we were now classified as part-time farmers. We were to receive a letter to that effect, but after two weeks without word we called the auditor. He said they had reviewed our appeal again and decided that we were back down to hobby farmers".
Still other legitimate complaints I often hear from taxpayers trying their best to deal with the tax department concern the belligerent and mean-spirited attitude of the auditors and the grossly unfair conditions which the Department places on the individual. The taxpayers are often confronted with an enormous tax bill and given only a very short time to pay it. This I think most people must agree is extraordinarily unfair, considering the farmer has had no expectation whatsoever that he might have to meet such a huge expense. Moreover, the person cannot delay payment of the bill pending an appeal, but rather must pay up and continue the appeal while the Government holds the money. When one resident in my riding asked the tax officials if he would have his money refunded on a successful appeal. He was told the following: "They said I would receive only the principal; that all interest charged is not returned as a matter of policy, whether the principal was deemed to be owed or not". In other words, Mr. Speaker, if you win your case and put up your money, the Government keeps the interest.
In addition to all of this, Mr. Speaker, my constituents are now finding that their tax problems do not end with the payment of their bill under the new assessment. I was talking on the phone just yesterday with a farmer in B.C. who, after paying close to $14,000 in taxes after reassessment, which he is still trying to appeal, has now been told that his wife must give back the money which she received from the child tax credit over the past three years, a period in which he was being taxed in a different bracket.
The letters from which I have drawn all of the above quotes have been submitted to the Minister, some as long ago as last April. He assured me in each case that there is nothing in these letters that needs correction by himself or by departmental officials.
In closing, Mr. Speaker, I say that there is overwhelming evidence that Revenue Canada has been and is acting in a manner completely unreasonable and absolutely unacceptable. The problems caused by the interpretation of Section 31 alone indicate clearly the unfairness of the present system and its application. The fact that there are many Government programs which attempt to assist farmers and yet the benefits can be wiped out in one fell swoop by the Department is ludicrous. Surely common sense and fair play will some day prevail.

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Mr. Pierre  Gimai@: Mr. Speaker, I asked to take part in this debate, since in my riding and region, as in many other regions in this country, the Department of National Revenue is very important. It is one of the most important institutions in our country, for a host of reasons. First of all because, to be able to function, a government obviously needs money. That is entirely normal, since the Department's main role is to redistribute wealth, and in order to do so fairly, the Government must first be able to collect money.
Second, in my region there are many workers who are taxpayers and as a result of a concentration of various multinationals and a number of large companies, many wage earners are earning high salaries, which means that they regularly deal with the Department of National Revenue to pay their taxes, among other transactions.
Of course, the Province of Quebec is a rather special case. In Quebec, we have two tax collectors, unlike the situation prevailing in other Canadian provinces. The Government of Canada collects federal taxes through the Department of National Revenue, while the Province of Quebec collects provincial taxes through its own Department of Revenue. That is the first point that strikes me. As you know, Mr. Speaker, I have been involved in politics for over twelve years and have spent ten of the last thirteen years serving the people of my riding and my region at various levels and in various positions, but always in the political sphere, and I have regularly had to refer to the Department of National Revenue concerning specific situations, in other words, people came to see me because they had complaints or wanted information on the federal Income Tax Act.
One constant comment was that the Department of National Revenue was human in its dealings with taxpayers, whatever the case happened to be, and especially compared with the Quebec Department of Revenue. It is certainly not my intention to attack Quebec civil servants. They do not have the same legislation to work with. They do not have the same directives either, but the fact remains that at the human level, the Department of National Revenue has proved to be more co-operative, more human and far less harsh in its dealings with the Canadian taxpayers. In addition, there is a general policy which I have heard repeated many times by departmental employees, that they had to make sure that their decisions do not put anyone out on the street.
It is true that from time to time they are harsh and take action. They must act according to the responsibilities they have been given by the Government, and I think it would be very bad for Canada and Canadian taxpayers if our public servants failed to act in certain cases, and where there is some ambiguity, it is clear that, faced with a decision that could either cause the Government to lose money or ensure that it can collect what is due, while at the same time making sure
that if the money is not owing to the Government, the taxpayer can be reimbursed, in all these cases, the employee is doing his job.
In this connection, what struck me most in the motion presented by the Official Opposition today is that we find again this insistence of the Opposition on getting political mileage out of a matter that is of fundamental importance to the Government.
Today, the Progressive Conservative party, which is ahead of us at the polls, is giving us all sorts of examples and making various statements that give the impression that the National Revenue officials are villains. I find this difficult to accept, but it reflects the philosophy of that party which is to always try laying the blame with the public servants. A leader of that party, who was Prime Minister for the very short period of nine months, and his successor, have stated openly that one of their great wishes was to eliminate jobs and lay off public servants.
This mentality is obvious even before the Canadian people even give them a chance to form the Government. In other words, they try to blame those who carry out the policies. This worries me, Mr. Speaker, since it is always easy for a politician in this place to blame those responsible for applying laws which are complex and very subtle, to blame those who work at the grassroots level so that the Government and Parliament can meet the needs of people, either by collecting money or otherwise, and who officially assume the responsibility for doing so on behalf of the Government. What makes me even angrier as a politician is the fact that, to my knowledge at least, no provincial Conservative minister or Government has ever complained that the Federal Government was collecting too much money for them. Hon. Members opposite are forgetting that, in all of the Canadian provinces except Quebec, the Canadian Government is responsible for collecting taxes. If Members opposite have received respresentations from their provincial colleagues saying that the Canadian Government, our tax collector responsible for giving money to their province each year, is doing a bad job and collecting too many taxes from provincial taxpayers and being unfair to them, if the Members opposite have heard such complaints from their provincial colleagues, let them say so! Mr. Speaker, we have never heard such a statement from any province. Quite the opposite, provincial Finance Ministers are always asking Ottawa for more money and urging the Canadian Government to collect more taxes to help them meet the needs of their people. It is much too easy, Mr. Speaker, to sit in two Assemblies at once and have two options. This reminds me of what is happening in Manitoba. Certain Members here seem to be voting in favour of the Franco-Manitoban minority while in the province, the same Conservatives point the finger at the same Franco-Manitobans, who are only a small handful. This is the type of ambiguous policy, for lack of a better word, that these people are trying to sell throughout Canada.


Mr. Deputy Speaker:: Order, please. I regret to stop the Hon. Member in full stride, but I would remind him that the motion before the House has nothing to do with the Official Languages Act or policy in Canada. I would ask him to come back to the matter before the House, namely the Income Tax Act.


Mr. Gimaiel:: Mr. Speaker, as you know, younger Members are impatient and we are terribly affected by certain things, behaviours we find odd and on which we want to comment. As you know, as far as 1 am concerned, my duty as a Member as I see it consists in representing my constituents of Lac-Saint-Jean, in making sure they are treated fairly by the Canadian Government, by our Canadian officials. In the discharge of that duty, Mr. Speaker, I regularly have an opportunity to work with the Minister of Revenue and to defend people. No later than this morning, a typical example of what can happen when a certain document does not get there on time, one of my constituents had his salary garnisheed. Having taken upon myself to give my word over the telephone that the required document was in the mail, which was the case, my constituent's pay cheque was freed and issued to him. This is the normal thing to do. Such is the role of a Member of Parliament, and if indeed a constituent has not sent in the form proving he was entitled to his tax abatement, his salary will be garnisheed along the way and this is normal. Any Canadian who owes tax must pay it.
We are here to represent people whose income tax is collected at the source by the Canadian Government. In this way, payment is made regularly-part of each pay cheque goes to the Canadian Government by whom it is redistributed. Clearly, there are people who are not taxed at the source. Such taxpayers must file returns, and they are subject to audits whenever the auditors feel that the taxpayer is not entitled to the deductions he has claimed or where he has failed to file a return. Clearly, in the enforcement of the Act errors may occur. And since error is human, there can even be cases of conflicts of interest between people, even personality conflicts between an assessor and an assessed taxpayer. This is where we step in. And this is where Conservative Members should step in instead of rising in this House to attack the principle itself, the basic principle that is feeding provinces under our Constitution, to attack the principle that the Canadian Government is the tax collector.
It is all too easy to aim haphazardly, to shoot at anybody, to try and make people believe that the Department of Revenue is a political tool. This in my view is a bit irrational, in view of the commitment made by this Government, by the Minister of Finance or the Minister of National Revenue over the years, to maintain, for instance, income tax indexing. There are all sorts of benefits granted to Canadians under the federal income tax legislation which are not available in the Province of Quebec
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under the provincial income tax regime because indeed of this Government's concern for the needs of the people.
As you know, Mr. Speaker, I object to the ambiguous approach taken by the Official Opposition. I would like to insist on this, if indeed the Provinces, the provincial Governments in power, the Conservative Governments in power, and in the first place the Ontario Government which has jurisdiction over 9 million people or more, if those governments feel the Canadian Government is not a good tax collector, let them say so. If Hon. Members can prove that indeed the Canadian Government is a bad collector, let them say so. If this evidence has come from the Ontario Government, or any other one, let them show it. We will then look at the possibilities.
The Minister said this morning: "I agree there are allegations of irregularities, allegations of unfair treatment. I agree." He acted the way a responsible Minister should have. He called for an inquiry, a study on how income tax is collected; and if changes are required, they will be made. And this behaviour by the Minister of Revenue today, before us, his speaking publicly, having no hesitation to meet what had been required, is the same behaviour he and many Department officials have always had. And one thing for which I give good marks to Revenue Canada is that when people get in touch with them, when they answer letters from the Department, there is always room for negotiation and agreement, unless there is bad faith on either side. Then the courts can step in.
Quite possibly, the Income Tax Act is not perfect and may contain sections which should be amended. That is obvious, and I for one am fully aware that a taxpayer who has to plead his case after receiving a tax assessment notice may very well incur high legal expenses or court costs. That is one of the handicaps which Canadians must learn to live with, and perhaps we will be able to remedy the situation in due time. But that is certainly not an excuse to point the finger at Revenue Canada because, by facing up to its responsibilities, the Department makes it possible for the Government and other organizations to meet the needs of Canadians first.
When it comes to specific cases, I hope that my Conservative colleagues, like many of my Liberal colleagues, take the same approach as I do and work closely with Revenue Canada to solve the problems of their constituents. Hopefully, that is indeed what my Conservative colleagues do. I would hate to think that the cases they mention are just a way for them to prove that the Government is not operating properly.
Someone said this morning that there are 15.5 million taxpayers in Canada. Well, 15.5 million, that is quite a lot of taxes to be collected. It stands to reason that we are bound to have problems and difficulties in the field of taxation and in others, otherwise there would be no need for Members of Parliament to represent the Canadian people, speak up for them and defend their interests. If there were no need to amend our legislation, all Members of Parliament could pack up and go home. It just happens to be our role. Looking at it
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from the standpoint of the Official Opposition, I can almost understand why they would want to stretch the debate over a month or a month and a half; after all, if 15.5 million Canadians are involved, it has to include just about every voter aged 18 or more. If they manage to make all voters believe that the Canadian Government indiscriminately fires at them to hurt them at random, they will probably gain a few votes. But the one thing that the Official Opposition forgets is that the first beneficiaries of the taxes collected by the Canadian Government are their own colleagues who head the provincial Governments. They are the first-line beneficiaries of some of the taxes collected by the Government of Canada. And if it were generally true that Canadians are given a hard time by Revenue Canada, and I do not believe they are, then the provinces, as beneficiaries, have not heard a word about it from their people. If that were the case, it would mean that those provincial Governments are simply not doing their job. Either they listen to their people or they do not. That being so, their colleagues sitting here across the floor are convinced that they do not relate the facts as they are, or else they are trying to make political hay. One or the other. Does the Ontario premier know what is going on in his province or are the Conservative members from Ontario trying to score political points with individual cases? They could perhaps tell me, Mr. Speaker, because I do not know. In my Lac-Saint-Jean constituency, for example, I must say that taxpayers would rather deal, and I say it openly, with the federal rather than the provincial Department of Revenue. They are kinder and more understanding, which is greatly appreciated, and it is easier to appeal decisions. The statements are sent with more information when necessary and the federal tax is lower than the provincial. This is already a lot. It is strange, is it not?
Those strong criticisms against the Department of National Revenue in the English-speaking provinces cannot be found in Quebec where the same problem does not exist. I would be lying if I told you that a great many visitors come into my office to complain about federal tax officials. I will even add that for us, in the Lac-Saint Jean constituency, there is a new dimension to the Department of National Revenue.
Thanks to a Government which wanted that Department to be humane, two important events have occurred in my constituency and the Saguenay-Lac-Saint-Jean area since 1980. Firstly, an office of the Department of National Revenue was opened in Chicoutimi thus allowing tax collectors to be near the people and get to know them better. Taxpayers can go and see those responsible for the implementation of the legislation, have discussions with them, analyze problems, get acquainted more thoroughly with the legislation and ask questions. Services have been made available free of charge to all non-profit corporations and special advisors can help them to file their income tax returns. In addition, Mr. Speaker, for the sake of regional development and to try to help all Canadians to take advantage of a collection system, the Canadian Government,
in spite of the fact that in 1979, a Conservative Government decided to alter the decision and to put a stop to the project already under way, built in Jonquiere a Tax Data Centre which since the beginning of 1983 has hired over 400 people over 20 per cent of whom are from my own Lac-Saint-Jean constituency. Thus, many young Canadians could enter the civil service in the Department of National Revenue, without becoming gansters or torturers and I can tell you that nobody hates them for this in the Lac-Saint-Jean constituency.
Mr. Speaker, I think that in this House we should rather deal with important national issues and plead the case of our own constituents; but we can do it also in our own office with the minister and the Government and all those whose role it is to help Canadians and give them all that is needed for their development and freedom. Thank you, Mr. Speaker.


Mr. Deputy Speaker:: Order! Questions or comments.


BUSINESS OF THE HOUSE
Yvon Pinard: Mr. Speaker, I rise on a point of order. I would like at this time to indicate to my colleagues in the House what the business will be in the coming days. I have already advised my colleagues, the House Leaders in the Opposition, that tomorrow we will be resuming debate on Bill C-3, the Canada Health Act. The back-up Bill, if need be, will be Bill C-7.
I would like to designate Monday as an Opposition day. Tuesday, Wednesday and Thursday of next week I would like to designate as the fourth, fifth and sixth days of debate on the Speech from the Throne. This is all subject to change, as usual.


BUSINESS OF SUPPLY
[Stage Direction]
The House resumed consideration of the motion of Mr. Beatty:
That this House condemns the Government for its contempt for the taxpayers of Canada, which it demonstrates by the creation of a taxation system in the form of the Income Tax Act that is increasingly incomprehensible for individual taxpayers and, by its failure to end capricious and unfair practices of the Department of National Revenue.
And the amendment thereto of Mr. Riis:
That the motion be amended after the words "individual taxpayers" by inserting the following:
"and which favours big business and upper income earners at the expense of
small business and average working Canadians."
Mr. John Gamble (York North):: Mr. Speaker, I am pleased to have this opportunity to deal with the motion which my
January 19, 1984

colleague, the Elon. Member for Wellington-Dufferin-Simcoe (Mr. Beatty), has placed before the House today. For the purpose of the record and so that my remarks may be in context, I would like to repeat the motion. It provides:
OO)
That this House condemns the Government for its contempt for the taxpayers of Canada, which it demonstrates by the creation of a taxation system in the form of the Income Tax Act that is increasingly incomprehensible for individual taxpayers and, by its failure to end capricious and unfair practices of the Department of National Revenue.
It is apparent that the motion itself contains two separate charges-one charge laid against the Government generally for the fashion in which the principal revenue-generating statute of the country, namely the Income Tax Act, has been drawn; and the other charge relating to the way in which the income-generating arm of government, namely the Department of National Revenue, has functioned under the statute it administers.
I listened with some interest to the comments made by the Minister of National Revenue (Mr. Bussieres) when he rose in his place to discuss this matter. Initially he directed those comments to the issue of draftsmanship, suggesting that it was not the fault of the Department of National Revenue that the wording in the statute might be somewhat complex. If one looks at the motion, very clearly we have condemned the Government, of which that Department happens to be a part and for which the Minister happens to be the chief spokesman on this issue, and accordingly that condemnation applies whether or not the Department of National Revenue which is to be condemned specifically under the second part of the motion.
In any event, the Minister proceeded to explain why in his view it was necessary to have such extreme complexity. He described it generally in this fashion. He said that the complexity was a reflection of the complex commercial society which has been created, as though the complexity of commerce created the complexity of the Act when indeed the reverse is true. Those changes have taken place in our commercial world as a consequence of a monstrous piece of legislation. It has forced taxpayers carrying on business to amend the way in which they would normally carry on business to take advantage of whatever advantages were created under the Act as an intention of Government. We now have a society brought about in its complexity and directed in that complexity as a direct consequence of the way in which the principal revenuegenerating statute, the Income Tax Act, has been drafted. Accordingly 1 suggest to the Minister that he has the cart before the horse.
The issue of complications and the issue of difficulty are those which have been directed to the Minister of Finance (Mr. Lalonde) and to members of the Government. Indeed they are issues about which I have spoken when I have had an opportunity to deal with individual amendments to the Act as they are regularly made. The last time we spoke on the issue I specifically indicated that they were perpetuating a system which was in place and did no good to the solution of a
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problem which Government must surely recognize, the problem that we are passing laws in Parliament that Hon. Members of the House and the public do not understand.
I have suggested on a number of occasions-and I suggest it again for the purpose of the record-that the principle of law that ignorance of the law is no excuse and that we are obliged to obey the law becomes ludicrous in the face of language which cannot be understood. In his recommendations today, the Minister stood in his place and said that it would be desirable if we could promote a better understanding of the Act. That was like suggesting that the Minister would like to teach the people of Canada to speak Martian, a language which he himself does not understand.
Surely the Minister should direct his attention to remedial action which should be taken with respect to the issue of simplification. A number of problems have arisen over the years. It is necessary, if the Minister really has any intention of doing anything about this issue, for him to understand what the problems are. How is it that we have a monstrous statute of the kind I have described? Of course I am not alone in making this condemnation. Every chartered accountant, every tax lawyer and practitioner in the field, recognizes that the problem is so immense and out of hand that it is creating the very real possibility that the public, which today and up until now regularly embarked upon a process of self-assessment- the foundation of the whole system-will reject the system in the event that the harshness and difficulty built into the statute persists for much longer.
Canadian Tax News, a publication of Coopers & Lybrand, an international and certainly well-known Canadian accounting firm, through the work of the editor of that publication, referred to the wording in the statute as gobbledygook. It specifically indicated with respect to this issue that the problem was that we have created language so designed to block every conceivable loophole which could exist and to create a perfect fortress for the Department of National Revenue that we have made it impossible for the public to understand the words which have been used. The suggestions made are quite clearly that in the event we wish to preserve the self-assessing system, it may be necessary to use words which are not as complex and to eliminate sections which go on page after page after page using very precise terms of art and legal words. It may be necessary to abandon that practice if what we have at stake is the destruction of the entire self-assessing system.
Of course the risk of doing that is that through a reduction of some of the verbiage, through a loosening up of some of the fortress mentality brought upon the scene by the Department of Finance, it may in fact ensue that we will lose the odd dollar of taxation. However, compared with the possibility of destroying the basis for self-assessment, destroying the credibility which taxpayers of the nation have in the system, some suggest it is preferable to abandon the absolute ironclad fortress assurance of alleged perfection.
We have reached this point because this Act, the principal revenue-generating statute of Canada, is designed to do more than raise revenues alone. It is designed to establish social

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policy, to plan land use controls-something which I believe, incidentally, belongs with the provinces-and to promote growth and development of particular industries, all under the Income Tax Act. Clearly the name should be changed. Why do we not call it the omnibus Act to do everything? In that way we could well understand why it is so complex.
The Act must be directed toward raising revenues. If there are policies that a government, be it this Government or any other, wishes to follow, then let it follow those policies under a statute dealing with them, not create a monster so beyond the comprehension and mental ability of the citizens of the nation that it does injustice to the raising of taxes. I offer that suggestion to the Minister of National Revenue in the absence of the Minister of Finance who, quite rightly, is responsible for the drafting of the Act under which we all suffer.
There are other things which might be done that have been recommended by others who practise in this field regularly. Indeed it might be appropriate if a new drafting method were employed, a drafting method which would at least see the gathering together in a single place of those provisions of the Act that deal with the specific issue designed to be dealt with.
The general rule related to that issue might precede other rules that are subordinate in nature. The deductions, exemptions and special rules that might apply to that particular issue might be found in a particular place in the Act. It will not then be necessary to try to skip and jump from one place to another. That would not be difficult in a small statute, but in this statute, it is particularly difficult.
It is difficult because of the terms of art, some of which are genuine definitions and found in a definition clause. Others are definitions which are found in the clause establishing the term of art as an essential ingredient to the imposition of tax. Accordingly, it has become almost impossible to find one's way through the statute, even using the index that is supplied.
Drafting changes alone will not reduce the volume. I know that I cannot display size in the House. However, it is apparent that if you examine the change that has occurred to the Income Tax Act, second edition, for 1971, the last year under the old system, and examine the Act today, it is not only the thickness of the publication that is important. The size of the print in the second volume is half the size of the print in the first volume. The width of the volume is even larger. In other words, you almost need a magnifying glass to follow the words. If it were drafted in the same size print as the 1971 edition, the volume would be twice the thickness.
We have just gone through changes to this Act as they relate to a plan to index the growth in securities as part of a simple issue, a capital gain issue. The Ways and Means motion which brought in that recommendation was 43 pages in length as it applied to that single issue. That issue was but a small portion of an issue, which was capital gains. At some time it will be necessary to examine the cost benefit of some monstrous provision of the Act that may, in terms of return, cost us substantially more than it is worth.
For the year ending March, 31, 1984, regarding salaries paid to officers of the Department of National Revenue, described by the Minister as 18,000 employees and by the Parliamentary Secretary to the Minister of Finance (Mr. Fisher) as 10,000-take your choice as those two figures are close one to the other-the additional increase will be $53 million. It will cost an additional $53 million for the purpose of understanding and enforcing provisions beyond the comprehension of Members of this House, Canadian citizens and officers of the Department of National Revenue. We will have to determine whether that is a worthwhile expenditure.
The time has come for Members of the House to analyze whether the growth of this monstrous mechanism will provide the returns for which we should be looking if we are prudent legislators and if we have some regard for the welfare of individual Canadians.
I wish to deal briefly with the other aspect of this motion. We heard comments by members of the NDP and by the Parliamentary Secretary to the Minister of Finance. They have taken a somewhat similar approach. It is that there are people in Canada who pay their fair share of taxes and people who do not. Accordingly, the actions of the Department of National Revenue in pursuing the latter are valid and should be commended. After all, they are out there to help the first group who pay their fair share.
The great problem with that is that the speakers from both Parties presume that those who have trouble with the Department of National Revenue are not paying their fair share of taxes. The Parliamentary Secretary to the Minister of Finance described a lady in his constituency who had two cars. Right away that is an offence. No one should have two cars. Everyone understands that people with two cars are an offensive element in society. Also, she lived in a nice home, which is a crime in this society. She sent her children to private school, which clearly should earmark her as an enemy of the state. This lady had a problem with the Department of National Revenue. She was assessed. Under the provisions of this Act you, Mr. Speaker, may be assessed, I may be assessed, we all may be assessed, and we have to pay whether we are assessed correctly or not. When that assessment is mailed to you, you owe that amount. Since you owe it, the Department can collect it.
I have referred in this House to circumstances where, on a day when an assessment was issued, officers of the Department of National Revenue could go to the Federal Court of Canada and there obtain a certificate having the effect of a judgment and the next day execute it, seize your property and sell it. That is the simple fact. Whether you ever owed the tax is another matter. It may be years before that determination is finally made.
The issue is not whether you owe it legally because the Act says you do. The issue is whether you should owe it, and the court will determine that. Arguments that have been advanced in the House about individual taxpayers are meritorious. In my submission, that is our task as Members of Parliament. Any member of the Government standing in this place saying that
January 19, 1984

this is the wrong place has lost touch with reality. Why? We heard today that, as a consequence of our constant attack upon the way in which the Department of National Revenue is functioning, the Minister has finally appointed Woods Gordon to do an examination of the administration of the Act.
That is very refreshing. Even if the particular individual in Woods Gordon has never been through the door of any office of the Department of National Revenue, he probably has a better grasp of what is happening there than the Minister, who stood in his place and consistently refused to answer valid questions as to where the quotas are being imposed in Canada. Why are we concerned about where the quotas are being imposed? Why are we concerned about an obligation upon individual assessors to go out and collect additional revenues? It is for the very best of reasons. People in the area served by those district offices, unfortunately, are under pressure to pay money which they may not owe. Why? Through the establishment of quota systems we have given to individual assessors a vested and a personal interest in issuing assessments in order to have themselves promoted and receive additional salary. It is as though we were giving them a commission on every assessment that is issued. That is an offence to the system. We are discharging our duty. I turn to the government members and ask them to do the same.


Douglas Glenn Fisher: I have just a short comment, Mr. Speaker. I cannot resist a follow-up to the speech of the Hon. Member for York North (Mr. Gamble). He distorted pretty badly my views when discussing cases of individual taxpayers in the House. Let me set it straight. When I gave the example of a family in my riding, it was not for the motives that he provided in his distortion. I do not care how many cars people own. I do not care where they live, or how much money they have, or any of those kinds of things. I do care if they finance that from funds they owe to the Government of Canada and their fellow Canadians. That was the point of my little story. The point of my story was further that it is possible to take an individual case and twist it around 16 ways on Sunday to fit the point you are trying to make.
That is what the Hon. Member did with the case I raised and that is what other Members in this House have done. That is why 1 do not think we should be raising these kinds of cases here. We should not be dragging the affairs of identifiable individuals into the House for those purposes. That is the only point I wanted to make. The Hon. Member has other avenues open for the discussion of individual cases. He knows fully well that he can, as the Member for Bow River (Mr. Taylor) does regularly, use an anonymous case to develop a principle. I respect that, but I do not respect people who drag out individual cases and then make sweeping accusations. That was the point of my story.	.


John Albert Gamble: Mr. Speaker, the Parliamentary Secretary to the Minister of Finance is condemning his own practice. I condemned it and he did, so we are in agreement with respect to that. The simple fact of the matter is that, unless I am
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mistaken, the Parliamentary Secretary for the Minister of Finance has probably slightly less experience than in I have in tax law. I ask him to confer with others on whether it would not be true that the simple issuing of an assessment does not necessarily mean that the tax should ultimately be paid. He has given an illustration. He failed to recognize that that money may never ultimately be due. It is not a matter of borrowing from the Department of National Revenue or the Government of Canada. It may be a matter of an improperly based assessment arising as a consequence of the establishment of a quota and an ever-zealous tax assessor who went out there to get a promotion. That is the real issue.


Douglas Glenn Fisher: Mr. Speaker, the Hon. Member certainly makes a legitimate point. In the question and answer discussion after my comments I expressed my agreement with much of what he has just said. We have a self-assessing system which requires that the Government have the right to come in and check after the individual files his or her return. I differ with the opinion of the Member for Bow River that the Government should be limited severely on that. You need the checking and the policing following the filing of your own return. Every Government needs that. A Tory Government would not change that. I do believe a change in the next step is necessary. I believe that the individual should have a great deal more flexibility at the appeal level. If the Government is wrong, we should have more flexibility, especially for the small taxpayer who has trouble financing the appeal. The individual should have more access to the appeal process. The current appeal process leaves too much power in the hands of the tax department and not enough power in the hands of third parties. We do not get to third parties until too far down the road. I believe we should have some system similar to the small claims court in Ontario where an individual can go in and present his or her case to a third party without a lot of complexity and expense, and do it quickly. I do not believe that we should be using individual cases to make that point.


John Albert Gamble: Mr. Speaker, I have a suggestion which the Hon. Member in his position as Parliamentary Secretary to the Minister of Finance may take and use. One of the great objections to the appeal process today is that the taxpayer is entitled to only 90 days from the date that appears on the notice of assessment to the date when he must file his initial notice of objection. After that objection is filed, the Minister may take 180 days, which is six months, to decide whether he is going to move on it. If the Member is really concerned about this issue, let me suggest to him that the time which the Minister has may be reduced to the same 90 days. It would be fair to reduce the time and get to the justice of the issue, which we should all be concerned about, as speedily as possible.


Gordon Edward Taylor: Mr. Speaker, I would like to make a quick comment. It is a pretty sloppy operation when there are three assessments on the same file and everyone comes up with a different answer. Surely that needs investigation. Either one of the assessors is under pressure, or there is something wrong

January 19, 1984
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with the assessors. No taxpayer should be subjected to that type of thing.


Douglas Glenn Fisher: Mr. Speaker, I would like to make a comment. We have an interesting line of thought going with the Member for York North (Mr. Gamble). The Hon. Member has a political philosophy according to which he would like to lend a lot of freedom to individuals. That is a useful thing to hear in this kind of a debate. I congratulate him for that. I think he is bringing out some important points. I would go one step beyond what he is saying and take a hard look at the way the tax department communicates with taxpayers. Many taxpayers do not even know what they are being assessed. The Member for Bow River raised the question of assessments. I think there are many people who do not even know that they are subject to reassessment later on. They think the notices they get from us are final notices and that they close the door. They do not realize that we can go back again and take another look if we have reason to do so. We need to clean up the communication area. Individual citizens are entitled to know the rights that they have and to have them stated clearly in the communications when they are sent out initially.


The Acting Speaker (Mr. Corbin):: Are there further questions or comments? If not, we will proceed with debate.


Mr. Speaker:: The Hon. Parliamentary Secretary to the Minister of Indian Affairs and Northern Development.


André Maltais: Mr. Speaker, today, we are again being treated to a kind of tempest in a teapot. I do not mean the debate on the collection of income tax is not important, but I am referring to the approach to this matter. I think the Member for Wellington-Dufferin-Simcoe (Mr. Beatty) would have been far more civilized in his approach to the subject if he had refrained from attacking the Department of National Revenue, its employees and its Minister.
In fact, Mr. Speaker, I feel it is entirely legitimate to have a general debate on tax collecting, how it is done, the income tax return, the phraseology perhaps, and the matter of calculations. I think everyone will agree with that. But monopolizing a whole week before the House adjourned for the Christmas holidays and taking up almost another week to make all kinds of insidious accusations directed not only to the Minister as I said earlier, and also by making all kinds of insinuations about his employees I think that someone who has already been a Minister in the Government should realize this is not fair play.
Mr. Speaker, it is very easy to play politics with the National Revenue question. Everybody knows perfectly well that all Canadians have a very negative attitude to the collection of income tax. I think it is quite obvious that when the Department asks whether everybody has paid taxes who is supposed to pay taxes, it is a difficult time for the taxpayer.
Under any Government, however, the first responsibility of the Minister of National Revenue is to ensure that people can pay what they owe to the Government on the basis of equity, equality, and justice, whatever the circumstances. That is the basic principle for financing Government operations.
To people on the Government side or in the Opposition and to the average Canadian with a minimum of common sense, these things are quite clear, but the Member for Wellington-Dufferin-Simcoe verges on the irresponsible when he wants to blacken the institution's reputation by making all kinds of assumptions and giving the impression that the Minister, his officials and the whole Department are in collusion to exploit Canadians.
Mr. Speaker, Revenue Canada-Taxation published a document in 1982 called "Inside Taxation", and Chapter 8 of that document contains a whole series of measures in connection with appeals. Interestingly, the document mentions that during the year ending on March 31, 1982, Revenue Canada sent nearly fifteen million notices of assessment and received 33,266 notices of objection, of which approximately 95 per cent were dealt with outside the courts.
It has now been exactly fifteen days, if we include the week before the holidays and the past three days, that we have been talking about just about everything and anything, without referring to the facts. Mr. Speaker, every year fifteen million taxpayers are invited, under the legislation, to contribute to the Government's finances, and of these fifteen million, 33,900 submit notices of objection. Of those 33,000, 95 per cent are able to settle their differences with the Department directly, without going to Court.
Actually, I do not know whether or not the Hon. Member for Wellington-Dufferin-Simcoe has ascertained why those 33,900 taxpayers have opposed their assessment notice. Well, it is clearly indicated that most of the time, taxpayers will question their assessment notice on the basis of interpretation. The whole problem with taxation, Mr. Speaker, is that when people question an assessment notice they do so on the basis of interpretation.
This morning, someone asked what is an artist? What is taxable? What is allowed as an expense? What is a non-taxable expense? What is considered as an expense when someone can earn an income by using costly instruments? I think of the tools used by workers, I think of desks, of equipment used by professionals in the fields of health or law. Mr. Speaker, this is a matter of interpretation.
We could have had a more interesting debate on the issue of taxation if, besides requesting a debate on the Income Tax Act proposals had been put forward. However the Opposition is bankrupt of ideas in this regard. And I do remember when I rose during the debate on the Address in reply to the Speech from the Throne, that I told the Leader of the Opposition, my
January 19, 1984

good friend from Central Nova (Mr. Mulroney), not only to lead the Opposition but also to lead them with proposals, of which there is a serious lack among our colleagues opposite. And this is even more obvious in the motion put forward by the Hon. Member. The motion before the House today is only a formal motion devoid of any substance. Given the fact that 1 am the last speaker to rise on the Opposition motion, I would like to read it again to the House in order to show the Canadian people its triviality. The motion reads as follows:
That this House condemns the Government for its contempt-
We should give a definition of contempt, Mr. Speaker!
-for the taxpayers of Canada, which it demonstrates by the creation of a taxation system in the form of the Income Tax Act that is increasingly incomprehensible for individual taxpayers and, by its failure to end capricious and unfair practices of the Department of National Revenue.
What is so basic in such motion from the Opposition? I suggest that this motion which has been moved by the Hon. Member for Dufferin-Simcoe (Mr. Beatty) is groundless. It has no substance whatsoever. I wish the Hon. Member had indicated instead what concrete steps he would have taken, what document he would have tabled to amend the Income Tax legislation. We agree on the need for streamlining. All the governments, all the countries of the world are faced with this phenomenon, Mr. Speaker. There are always new regulations and legislations which make interpretation difficult. But to go as far as casting aspersion on the institution and suggesting that the Minister of National Revenue was paying a sort of game at the expense of taxpayers or that his officials were to blame for the way they carried out their duties, I think, shows a lack of responsibility on the part of Parliamentarians who claim they could lead the next government.
Mr. Speaker, it is important for Canadian men and women to know that, because Hon. Members are allowed to say just about anything in the House, which is just what members of the Opposition are most inclined to do. They feel that they can do and say anything to discredit that department and its officials. As for me, like all other Members of this House I too have had to work regularly with officials at various levels of the Public Service, and we also have a normal procedure to express our views. However, I do not think that any parliamentarian who had any sense of responsibility or any kind of insight would believe that public servants simply want to take every opportunity to embarrass Members of Parliament or ordinary citizens.
Mr. Speaker, I hope that in the future Hon. Members opposite will at least try not to involve departmental officials in our debates. This is extremely important. What gives the institution its quality is the fact that public servants should not always fear of being the butts of the jokes of an irresponsible Opposition. This is fundamental, Mr. Speaker. 1 believe that if a Member opposite disagrees with what the Minister of National Revenue said, he can argue the matter at the political level, but he has no right to question the word of the president
Supply
of the National Revenue public servants' union, who explained the situation very well by saying that neither the Minister nor the senior officials of National Revenue Canada had ever imposed quotas or published instructions in this regard.
I believe, Mr. Speaker, that certain distinctions must be made and the Hon. Member would be well-advised to take them into account, otherwise there will be so many abuses that the entire credibility of public servants who must deal regularly with the public could be greatly damaged. If we really want this institution to be able to operate on a basis of respect and professionnalism, I hope that next time the Hon. Member will think it over twice before making similar allegations.
Mr. Speaker, I would like to add, as far as the motion that has been introduced is concerned, that Opposition Members have never been able to offer any evidence, however trifling, to the effect that the Minister had gone beyond its mandate. They never did. The only thing they achieved, including the Leader of the Opposition, was to try and make fun of a Department or of some action taken by a Department which is vital to the financing of the State. This is serious, Mr. Speaker. I suggest these are things which must be said in this House, because it is too easy to try and take advantage of the situation by presuming the citizens are not informed. One should never forget that the people who follow our proceedings can think for themselves. And anybody who has paid any attention to this debate has had no trouble noticing that Opposition Members had no facts to offer except for personal cases.
The same is true, Mr. Speaker, for the people of Manicoua-gan, and in this regard, I would like to point out the increasing number of people from Schefferville and from Sept-Iles who are writing to me on other matters related to their income tax, because the federal and provincial governments, as well as the corporation and the union had to give considerable amounts of money to those people who have been laid off. And it is now the Member of Parliament who has to cope with the problem, and not the former President of the Iron Ore Corporation, Mr. Speaker. It is now the Hon. Member for Manicouagan who has to meet 50 or 60 persons every day to help them determine whether they have to pay income tax. And it is the same Hon. Member for Manicouagan who has no other choice but to repeat the statement made by the former President of Iron Ore in Schefferville before the parliamentary committee in February 1983. It is the Hon. Member for Manicouagan who has to make the distinctions, and in this regard, I often have to deal with the Minister of National Revenue of Canada in order to try and iron things out for the people. However, I would not say that public servants are not doing a good job, Mr. Speaker. This would be too easy. And I would not give up my constituency and seek refuge elsewhere as others have done. Never in my life, Mr. Speaker! When you are from the North Shore, you stay on the North Shore and deal with the problems of the North Shore.

Supply
1 had so many things to say, Mr. Speaker-


Mr. Speaker:: I must call the Hon. Member to order. He is wandering far away from the subject matter of the motion which is now before the House. I would ask him to speak to the motion.


André Maltais: Mr. Speaker, since we are discussing the matter of income tax at this period of the year, and since I have been working at my constituency office during the holiday and have been seeing so many people who have been laid off, I could not avoid linking together the whole matter of income tax collection and the people in my riding who are facing a difficult situation. And I would like to suggest that I would be remiss not to bring about the tax problems facing the people of Manicouagan when the debate is precisely on the matter of income tax.
The motion mentions contempt, and I would merely like to indicate that at this time, Revenue Canada officials are not showing any contempt whatsoever toward the people of Manicouagan. Indeed, last week, I had a meeting in my riding office with the three senior officials from National Revenue in Quebec City in order to try and find jobs for people who were laid off.
1 wanted to make that point, Mr. Speaker, because I can think of so many cases that are strictly factual without having to start smearing everybody. In particular, Mr. Speaker, I would like to speak about people in Schefferville, Labrador City and Wabush, not only in my riding because Labrador is also greatly affected, but about people in Sept-Iles as well. Members on the other side have been trying from the start to distort the debate by reporting specific cases. Therefore, Mr. Speaker, I think I got literally to the heart of the motion when I said that Revenue Canada officials did not show contempt for those with tax problems, people I meet regularly.
Mr. Speaker, I would like to say before completing my remarks, since I have about three minutes left, that it might be interesting to hold a broader debate on the question of taxation, more precisely on calculation rules, so that ordinary people could understand what it is all about. Furthermore, the proposal made this morning by the Minister of National Revenue, the Member for Charlesbourg, for a study in depth of the different methods used by his Department to collect taxes will be widely acclaimed and I hope that such an opportunity will be taken perhaps to update that legislation.
I think, Mr. Speaker, that everybody will admit that it is necessary to simplify the Income Tax Act, to develop interesting ways for people to fill, themselves, their income tax in an adequate way and, manage as the saying goes, to render unto Caesar the things which are Caesar's and unto God the things which are God's.
Mr. Speaker, this new evaluation will not be done only by simply discussing from a negative approach the whole income
tax issue. I am very pleased now to see my friend from Central Nova and I would like him to read my notes relating to the people of Schefferville, Sept-Iles, Labrador City and Wabush, who have income tax problems, Mr. Speaker. Later on, I will be speaking to him, but what I was pointing out, Mr. Speaker, for the benefit of my friend of Baie Comeau, is that it is very easy not to make any suggestion when you are the Hon. Leader of the Opposition. I would like, however, to see the Hon. Leader of the Opposition as a leader when it comes to making suggestions. What I did not like in the motion put forward by the Hon. Member for Wellington-Dufferin-Simcoe (Mr. Beatty) is the fact that he failed to make any concrete suggestion, Mr. Speaker, and I hope that the Hon. Leader of the Opposition will give instructions to the Members of his caucus in order that, in the future, when they raise points of national interest, they do not simply criticize what is being done but make concrete suggestions.
I remember when the Hon. Leader of the Opposition, then President of the Iron Ore Company, came to see me here in Ottawa as the Member for Manicouagan; together we put together proposals for the people of Schefferville and, later on, if he wants to ask questions, he will be able to do it, Mr. Speaker. The current Leader of the Opposition-


Mr. Deputy Speaker:: Order! It being 5:45 p.m., it is my duty, pursuant to Standing Order 62(9), to interrupt the proceedings and forthwith put every question necessary to dispose of the Supply proceedings.

The question therefore is on the amendment. Is it the pleasure of the House to adopt the said motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


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


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


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


Mr. Deputy Speaker:: Call in the Members.


Mr. Speaker:: I declare the amendment lost.
The next question is on the main motion. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


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


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


Mr. Speaker:: In my opinion the nays have it.
And more than five Members having risen:
++NAYS
Messrs.


Mr. Speaker:: Shall I dispense with the ringing of the bells?


Some Hon. Members:: Agreed.
AUmand	Dawson	Gourde	The House divided on the motion (Mr. Beatty) whit	Appolloni (Mrs.)	De Bane	(Levis)	negatived on the following division:	Axworthy	de Corneille	Gray	Bachand Baker	Demers Deniger	Guilbault Harquail	(Division No. 7)	Beauchamp-Niquet	Desmarais	Henderson	(Mrs.)	Dingwall	Herbert	YEAS	Begin (Miss)	Dion	Hervieux-Payette	Berger	Dionne	(Mrs.)	Messrs.	Blaker	(Chicoutimi)	Hopkins	Bloomfield	Dionne	Hudecki	Althouse	Deans	HamiltonBockstael	(Northumberland-	Irwin	Andre	de Jong	(Swift Current-MaBossy	Miramichi)	Isabelle	Anguish	Dick	Creek)Breau	Dubois	Ittinuar	Beatty	Ellis	HargraveBujold	Duclos	Joyal	Benjamin	Epp	HawkesBurghardt	Dupras	Kaplan	Blenkarn	Fennell	HeesBussieres	Duquet	Kelly	Bosley	Forrestall	HnatyshynCaccia	Erola (Mrs.)	Killens (Mrs.)	Bradley	Fraser	HovdeboCampbell (Miss)	Ethier	Lachance	Broadbent	Fretz	Huntington(South West Nova)	Evans	Lajoie	Cardiff	Friesen	JarvisCampbell	Ferguson	Lalonde	Carney (Miss)	Fulton	Jelinek(Cardigan)	Fisher	Lamontagne	Clark	Gamble	KemplingChenier	Flis	Landers	(Brandon-Souris)	Gass	KilgourChretien	Foster	Lang	Clarke	Gilchrist	KnowlesCollenette	Fox	Laniel	(Vancouver Quadra)	Greenaway	KorchinskiComtois	Frith	Lapierre	Coates	Gurbin	KristiansenCorbin	Garant	Lapointe	Cook	Gustafson	La SalleCorriveau	Gauthier	(Charlevoix)	Cooper	Halliday	LawrenceCote (Mrs.)	Gendron	Lapointe	Corbett	Hamilton	LewyckyCousineau	Gimaiel	(Beauce)	Cossitt (Mrs.)	(Qu'Appelle- Moose	MacDonald (Miss)Cullen	Gingras	LeBlanc	Crombie	Mountain)	(Kingston and theCyr	Gourd	Leduc	Crosby	MacDougallDaudlin	(Argenteuil-Papineau)	Lefebvre	(Halifax West)	Malone
January 19, 1984
Manly
Mayer
Mazankowski
McCain
McCuish
McDermid
McGrath
McKenzie
McKinnon
McKnight
McLean
McMillan
Miller
Mitges
Mulroney
Munro
(Esquimalt-Saanich)
Murta
Allmand Appolloni (Mrs.) Axworthy Bachand Baker
Beauchamp-Niquet
(Mrs.)
Begin (Miss)
Berger
Blaker
Bloomfield
Bockstael
Bossy
Breau
Bujold
Burghardt
Bussieres
Supply
Messrs.
Neil
Nickerson
Nielsen
Nowlan
Nystrom
Oberle
Ogle
Orlikow
Parker
Patterson
Reid
(St. Catharines) Riis
Robinson (Burnaby) Roche St. Germain Sargeant
++NAYS
Messrs.
Caccia
Campbell (Miss) (South West Nova) Campbell (Cardigan)
Chenier
Chretien
Collenette
Comtois
Corbin
Corriveau
Cote (Mrs.)
Cousineau
Cullen
Cyr
Daudlin
Dawson
Messrs.
Schellenberger
Scott
(Hamilton-Wentworth) Scott
(Victoria-Haliburton) Siddon Skelly Speyer Stevens Taylor Thomson Towers Vankoughnet Wenman Wilson Wise Wright Young-108.
De Bane
de Corneille
Demers
Deniger
Desmarais
Dingwall
Dion
Dionne
(Chicoutimi)
Dionne
(Northumberland-Miramichi) Dubois Duclos Dupras Duquet Erola (Mrs.)
Ethier	Kelly	OstiguyEvans	Killens (Mrs.)	OuelletFerguson	Lachance	ParentFisher	Lajoie	PelletierFlis	Lalonde	PennerFoster	Lamontagne	PepinFox	Landers	PinardFrith	Lang	PortelanceGarant	Laniel	Prud'hommeGauthier	Lapierre	ReganGendron	Lapointe	ReidGimaiel	(Charlevoix)	(Kenora-RaGingras	Lapointe	RobertsGourd	(Beauce)	Robinson(Argenteuil-Papineau)	LeBlanc	(Etobicoke-Gourde	Leduc	Rompkey(Levis)	Lefebvre	RooneyGray	Loiselle	RossiGuilbault	MacBain	RoyHarquail	MacGuigan	SavardHenderson	Mackasey	SchroderHerbert	MacLellan	SmithHervieux-Payette	Malepart	Tardif(Mrs.) '	Maltais	TessierHopkins	Masse	TousignantHudecki	Masters	TurnerIrwin	McCauley	VeilletteIsabelle	Munro	WatsonIttinuar	(Hamilton East)	WeatherheadJoyal	Nicholson (Miss)	WhelanKaplan	Olivier	Yanakis-130


Mr. Speaker:: I declare the motion lost.
It being 6.25 p.m., the House stands adjourned until tomorrow morning at eleven o'clock pursuant to Standing Order 2(1).
At 6.25 p.m. the House adjourned, without question put, pursuant to Standing Order.

Friday, January 20, 1984