1984-11-26

Hon. Barbara McDougall (Minister of State (Finance)) moved: that Bill C-7, an Act to amend the Income Tax Act and related statutes, be read the second time and referred to the Committee of the Whole.
She said: Mr. Speaker, I am very pleased to introduce amendments to the Income Tax Act. The Government recognizes the importance of these amendments to the small business community. Therefore, the Bill has been brought forward early in the session to allow Canadians to benefit from the changes. As the House will know, most of the measures contained in the Bill were first proposed in the February 15 Budget of the former Government. A number of provisions which facilitate the implementation of the tax laws were contained in a draft version of the Bill, together with technical explanatory notes, published in August.
The present Bill is virtually the same as the Bill which was drafted in August except for some minor improvements. The changes to the Income Tax Act contained in the February Budget included important measures to simplify tax computations for small business. This Government is fully aware that small business is the lifeblood of the economy and employs two-thirds of Canadians. The new measures will significantly alleviate the paper burden which has fallen unduly on small business. The following changes are now being introduced to help small business to continue productively.
The small business tax simplification package will be effective for the 1985 and subsequent taxation years. It will provide certainty to taxpayers. The test to determine the eligibility of small corporations for the 35 per cent rate of credit on research and development, and the eligibility for a 40 per cent rate of refundability of investment tax credit, as well as an extra month to pay the balance of tax, will be based on a taxable income for the preceding instead of the current taxation year. This measure will provide more certainty in planning.
A special rule to prevent corporations from obtaining the low rate when they are controlled by means of options by
public corporations or non-residents is being deferred and will start to apply in 1986 rather than 1985. This measure will provide taxpayers with adequate time to rearrange their affairs. These legislative changes will simplify and shorten the corporate income tax form. In addition, the cost of tax compliance for small business will be reduced. That is why this Government is proceeding quickly to introduce these changes in the first session of the Thirty-third Parliament.
Also included in the Bill are a number of changes to the income tax provisions which affect registered charities, primarily charitable foundations. These changes are the result of very extensive and successful consultations with the voluntary sector. The charities are most anxious for these amendments to be passed into law. This Government recognizes the tremendous contribution of the voluntary and charitable sectors to the prosperity of Canada. In fiscal year 1979, 2.7 million people, or 15.2 per cent of the working age population of Canada, were involved in unpaid voluntary work. Canadians volunteered 373 million hours of labour in 1979. A calculation of the value added to the Canadian economy by the 40,000 charities which are registered in Canada suggests that this sector contributed $4.5 billion to the Gross National Product in 1980, which represents roughly 2 per cent of the total Gross National Product. The contribution and the dedication of the voluntary sector to the well-being of all Canadians should be commended and encouraged. That is why I am pleased to announce these changes to the income tax provisions affecting registered charities.
The Bill further contains a broad range of other important tax measures which will promote the growth and economic renewal of Canada. Changes to the provisions relating to employee stock option plans are designed to promote greater employee participation and increased productivity in the workforce. Another measure allows farmers a deduction of up to $120,000 of taxable capital gains on the sale of qualifying property where the money is invested in a registered retirement savings plan. This change will better enable farmers to plan for their retirement.
In addition, amendments are provided to further facilitate the transfer of family farms and shares of small business corporations from one generation to another.
The decision to proceed with these changes reflects the Government's commitment to the preservation and development of family farms and small business. The Government will establish a parliamentary committee to examine a number of agricultural tax issues. If changes are to be made to the treatment of farm losses in the next Budget, farmers will have the option of applying the 1985 tax regime to their 1984 tax returns.

November 26, 1984
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I will not take the time to enumerate all the measures included in this Bill. They have been announced previously and have benefited from substantial public consultation. However, I would like to mention some of the important provisions relating to the administration of the tax system.
The Bill provides increased exemptions from the requirements to make tax instalment payments. The new thresholds will benefit some 480,000 individuals, most of whom are senior citizens, from tax instalment requirements. The four-year limit on reassessments is being reduced to three years. The Tax Court of Canada will be allowed to establish guidelines for the award of costs to appellants. The Bill allows a taxpayer who files a waiver of the usual time limit on reassessments to revoke that waiver.
A number of other administrative improvements are introduced in the Bill. These measures deal with a range of matters including three refund mechanisms for certain taxes in dispute and measures allowing for the revision and late filing of various taxpayer elections.
The Government is pleased to proceed with these important measures because they are in keeping with our efforts toward improving the administration of our tax law. I would like to add that the economic statement and the accompanying agenda paper entitled "A New Direction for Canada" are documents of substantial importance to all Canadians. They are evidence of the determination of our Government to change the approach of' government in the formulation of public policy. Such a change is critical, not only to my income tax amendments but to other legislation, because we believe the key to successfully managing change lies in building greater understanding of our problems and casting a broad net in our search for solutions, at all times being fair and open.
[DOT] (mo)
Further amendments to the Income Tax Act will be brought forward as the need for revision is identified and after close consultation with Canadians during the consultative process following our economic statement.
The provisions of this Bill, Mr. Speaker, have had a lengthy period of public review. Most of the amendments were published in draft form in April for public comment and those draft amendments were reviewed in the last Parliament by the Standing Committee on Finance, Trade and Economic Affairs. The response to the draft amendments was very positive.
Prompt passage of this Bill will enable taxpayers to benefit from its many simplifying and relieving amendments. I urge all Hon. Members to support the Bill and to encourage its speedy passage.


Miss Aideen Nicholson (Trinity):: Mr. Speaker, I will be brief in my remarks because, indeed, most of the measures in this Bill before us are measures which originated from the Lalonde Budget in February and which have been further examined by a finance committee in the last Parliament.
It is interesting to note that out of the economic statements of the Minister of Finance (Mr. Wilson) the only concrete
steps which are before us are those which were adopted from the Lalonde Budget. The economic statement included promises, or perhaps threats, but the only real measures which have been implemented have come from the Lalonde Budget. Therefore, despite all the rhetoric about the bare cupboard, the prescriptions of the last Minister of Finance are being adopted and, clearly, the present Government have found that they are significant building blocks for economic recovery.
I commend the Government for adopting from the Lalonde Budget two very good measures, in particular, which would be helpful to Canadians. They are the proposals for tax simplica-tion and the measures to help small business. These were good measures last February and they are good today. I am happy to see them being implemented.
I am concerned, however, about two provisions. I hope that they will be addressed by other speakers from the government side. The first provisions is the reduction of the period of filing a notice of objection to a tax assessment from 180 days to 90 days. The Government claims that the February 15, 1984 proposal to increase the time to file a notice of objection from 90 days to 180 days is not being proceeded with due to more efficient procedures being introduced into Revenue Canada. However, this longer period does work in favour of the taxpayer and 1 regret that it is not being proceeded with. Surely what is at issue is not the efficiency of Revenue Canada but fairness in allowing the taxpayer adequate time.
My second concern is the matter of security for taxes payable. The February 15, 1984 proposal to require a Minister of National Revenue to accept satisfactory security for dispute taxes is not being proceeded with. We are told that this is because of the work which is actively underway to allow for the postponement of payment of such taxes until there has been a court resolution of the matter. I do have questions about this matter. Will there be a hiatus? How soon will the Government be prepared to issue a directive allowing for the postponement of such taxes? And if there is a hiatus, how will it be covered?
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Finally, the Government has suspended advance rulings. The Minister referred to the desirability of providing certainty in planning for business and we all support that. However, many businesses relied on advance rulings to assist them in their planning and I have difficulty in understanding why the provision for advance rulings has been dropped. I trust that these matters will be responded to by someone on the other side, either immediately or when we are in Committee of the Whole.
One final comment, Mr. Speaker. The Minister said that the Government intends to establish a parliamentary committee. We have seen some regrettable examples in the last week of the Government behaving as though this were a one-party state. May I remind the Minister that parliamentary committees are established by Parliament, not the Government, and this cannot be a unilateral decision of the Government.
November 26, 1984

M(r. Nelson A. Riis (Kamloops-Shuswap): Mr. Speaker, I am very pleased to have the opportunity to rise in this debate, and I would like to extend my congratulations to the Minister of State for Finance (Mrs. McDougall). 1 look forward to a number of years of interesting dialogue and useful discussion on ways and means of improving the tax system of this country in particular. I know she comes here with impeccable credentials and I assume that she is well aware of the boondoggle that we find our tax system in today. Undoubtedly we will be anxious to get into consultations and discussions to make the necessary changes and I welcome her to her new position.
As the previous speaker indicated, I think it is only right that we recognize that the Bill that we are debating today, Bill C-7, an Act to amend the Income Tax Act and related statutes, is really a Liberal Bill. Its provisions were introduced in the last Parliament by the Liberals. I vividly remember the debate. For days and days the members of the Conservative Party railed on and on, hour after hour, about the rack and ruin this Bill would bring to the people of Canada if it was ever passed. They went on and on about how this clause would absolutely drive business out of the country if it was introduced, or how that clause fell so short of what the agricultural community was requesting that, again, rack and ruin would be the order of the day. Now we have those same provisions, almost verbatim, being introduced in this Bill today by the Conservative Government, which describes it as a fantastic breakthrough, a new advance, enlightened legislation which will send a clear message to these various sectors of the community.


Mr. Thacker:: A small step in the right direction.


Mr. Riis:: Or, as some Members are calling out, a small step in the right direction. Why were those words not used only a few months ago when exactly the same Bill was introduced? I just wanted to make it clear, Mr. Speaker, that we are debating a Bill, introduced by the Liberals not so long ago.
Having said that, in spite of the Liberals having introduced this Bill, there is very little in it that is going to bring about any significant change. I recognize, as with any Bill, that there are provisions in this Bill which have some merit. In a Bill of about 125 pages, you will have a number of provisions that are long overdue and which should have been introduced many months or years ago. We have to recognize that as being advantageous.
To be specific, I refer to the small business sector and the item that will assist that sector in particular. Up to this point businesses had to keep track of their cumulated income until a target of $1 million was reached. After that, they were no longer eligible for the small business deduction. Many small businesses have made the case that year after year they struggle until they finally reach the magic cumulation mark. They then become a large business and consequently must pay the corporate tax rate. That was not fair and this Bill is going to remedy that problem. However, that same clause will allow doctors, lawyers, accountants and the like to qualify for a tax
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rate of 25 per cent as well. That points out the very essence of the problem with our tax system.
We are talking about the Bill in principle at second reading but I would like to refer to two or three of the specifics in the Bill. As all members of the House are well aware, as our tax system is presently constituted it results in thousands of individuals with incomes in excess of $200,000, $500,000, and in some cases $1 million, paying not one single penny in income tax. Granted, there are just a few thousand people in the $200,000 or $300,000 income range who do not pay any income tax year after year.
We can also identify large corporations which find themselves in a very similar situation. We recognize that during these difficult economic times many businesses, large, medium and small, do not pay any income tax because there is no income being generated. However, that is not the case with all corporations. In 1982 in the heart of the recession, companies like the Hudson's Bay Company, Steinbergs Incorporated, Simpsons-Sears Limited, Domtar Incorporated and many others were very profitable. That is fine, but if your profits are high, surely you should pay some income tax whether it be $2, $50 or $1,000. In spite of being profitable, the companies which I named paid no income tax whatsoever.
The existing tax system has become a laughing stock. Ordinary working Canadians are asked to pay their fair share to enable the Government to provide the necessary services- medicare, children's allowance, pension programs and veterans' programs. Ordinary Canadians willingly pay taxes for the services which they receive, but they become disillusioned when they learn that people in the upper income levels and profitable companies pay no income tax. In 1982 when a teller in the Royal Bank of Canada or the Bank of Montreal paid a few hundred or a few thousand dollars in income tax, or even $1 in income tax, that teller paid more income tax than the entire Royal Bank of Canada or Bank of Montreal. There is something wrong with a tax system in which a teller who pays $200 or $300 in taxes is actually paying more than the entire bank for which she works. This system is wrong. It has gone mad.
There is not a single thing introduced in Bill C-7 which alleviates these unbelievable and unfair practices. There is not one clause within this 125-page Bill that will result in those people in the upper income ranges paying any income tax. There is nothing mentioned about those many extremely profitable corporations, like the Bank of Montreal and the Royal Bank of Canada, who pay no income tax.
When the Hon. Member for St. John's West (Mr. Crosbie) was Minister of Finance back in 1979, he introduced something called the tax expenditure account. Such a measure should be introduced again by the present Minister of Finance (Mr. Wilson) alongside Bill C-7. That tax expenditure account identified all of those tax expenditure programs and the costs

November 26, 1984
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associated with them so that Members of Parliament and Canadians generally could identify a program and what it cost in lost revenue. It could then be determined whether that particular program was benefiting Canada and Canadians.
I applaud the Hon. Member for St. John's West for that particular measure and I suggest the Minister of Finance has a responsibility if not an obligation to introduce a similar measure so that we can identify those loopholes and see what they are costing Canadians. We would then be able to determine if such programs should be continued, curtailed or perhaps even expanded.
There are reports out now that indicate that various tax expenditures to corporations are costing Canadian taxpayers approximately $ 11,000 million a year. I wonder if the average Canadian taxpayer who pays from S300 to $2,000 in income tax recognizes that the Parliament of Canada gives an average of $ 11,000 million each year in tax breaks to the corporate sector in Canada? Are we getting what we should in return for that expenditure?
If one examines the record carefully to see how most of this money, which they do not pay in income tax, is spent by corporations, it would show that it is not spent to expand their operations for new lines of production or new venture opportunities elsewhere. Those corporations use that money to finance mergers and takeovers that often result in reduced producivity and job loss. If we had a mechanism for reviewing these programs we could evaluate whether Canadian taxpayers are getting their bang for the buck.
The Liberal Minister of Finance introduced a scheme which was a research and development quick-flip scheme. I recall his saying that this scheme would encourage research and development in the critical areas of our economy in the months and years ahead. He said that it would not cost much, perhaps $100 million or $200 million at the most in lost revenue while resulting in bountiful research and development opportunities. We discovered that this did not happen. The Minister's quick-flip research and development scheme resulted in the loss of well in excess of $1 billion in simply a matter of a few months. Did it result in new R and D opportunities? No. It was simply another opportunity for tax accountants and lawyers to take advantage of a loophole for their clients. If the facts were known, those who believed that there would be more research and development will be sorely disappointed when they face the reality of that so-called tax break.
I applaud the Government for seeing fit to shut that drain of public funds. It said that this scheme was not working in the best interests of the country and it stopped that nonsense. How many other nonsenses are there within the system? There are dozens of tax breaks, bribes or loopholes-however one wants to call them-given to corporations.
1 think one of the most sorrowful sights was when the Minister of Finance said during his economic statement that the Government will stop one of these incredible loopholes called the PIP grants. PIP grants refer to the thousands of millions of dollars we give each year to oil companies to explore for gas and oil.
I want to give an example of what another country does. Norway has natural gas and oil reserves off its coast. It depends on corporations in the business to explore. The Government of Norway tells the corporations that if they want to explore they will not be given a single penny, that they must fund their exploration 100 per cent. But if they find oil and natural gas, automatically the Government of Norway gets 80 per cent and will negotiate the other 20 per cent. All the oil companies are there, Mr. Speaker, and basically there is no incentive for them. The split is 80-20, with the 20 being negotiated.
We have a different idea here.


Mr. Benjamin:: We give it away.


Nelson Andrew Riis: We say to the corporations: "If you folks want to come in and explore, we will pay up to 80 per cent of the cost and if you strike oil or gas, for our 80 per cent participation we want 25 per cent of the action". This 80 per cent is taxpayers' money. This is not a bad deal for the oil companies. Not surprisingly, all the companies are taking advantage of that opportunity. But in Norway where there is a similar situation, there is no 80 per cent funding. There is no 25 per cent cut of the action. It is an 80-plus per cent cut of the action.
These are the kinds of tax giveaways that must stop. We hear people saying: "We have to come down with a heavy hand on all those people collecting UIC because we think they might be getting an extra $3 a week or an extra $17 a month and we have to stop this nonsense". Nothing, however, is ever mentioned about $11,000 million of corporate tax giveaways each year.


Leslie Gordon Benjamin: That is called free enterprise.


Nelson Andrew Riis: Some of these giveaways are worth while. Some of them result in an excellent payback to the people of Canada. It is certainly not the case for all of them, and they need to come under the same kind of review as the UIC is to undergo.
Members listening to this discussion or people looking in via television must believe that these are sensible people on the government side.


Leslie Gordon Benjamin: Maybe.


Mr. Hnatyshyn:: Order.


Nelson Andrew Riis: But why do they give away all of these particular bribes to corporations which obviously do not want them? As a matter of fact, the President of the Bank of Montreal, not many months ago, said that the Canadian corporate sector is awash in tax incentives. They do not know what to do with them any more. If Government members are intelligent, as we all know they are, why do they continue to do this? Why do they continue, if you like, to allow thousands of people each year to pay no income tax whatever? Why do they allow hundreds of corporations in some years to pay no income tax whatever? It is because of this old belief that if you assist those
November 26, 1984

folks in the upper income levels and if you give tax breaks to large corporations, domestic and foreign, eventually good things will trickle down to folks.


Leslie Gordon Benjamin: The crumbs.


Nelson Andrew Riis: I think my colleague, the Hon. Member for Regina East (Mr. de Jong) explained to me not long ago about feeding the horse oats. Here we are shovelling and jamming oats into this horse in the name of tax breaks or tax incentives. Eventually the oats will flow through the system, and out the other end will come the odd kernel. That is what we are getting. The ordinary Canadians are getting kernels, Mr. Speaker. We do not like to dig around and pick up those kernels any longer. Has that trickle-down theory worked anywhere? It does not work, but that is the myth on which this tax system is based. Whether it is the Conservative Party in power or the Liberal Party, it is the same old assumption. It does not work.
We are going to debate Bill C-7 in some detail over the next number of hours. I have identified one of what I think are very important clauses that will assist the small business sector, particularly regarding the elimination of the ceiling. On the other hand, I hope the Minister will explain, when we get into clause by clause study in Committee of the Whole, why doctors, lawyers, accountants and so on were included so that they too should have a special tax rate of 25 per cent. Why is it that we have included those particular professions and not other professions? I suspect again it is a reflection of the assumption under which this tax system is based-that if we can assist those in the upper income brackets, then benefits will accrue because they will invest. That investment has not happened. We have been giving tax breaks to individuals and corporations for years and years on that assumption, but the investment is simply not happening.
I remember when the Prime Minister of Canada (Mr. Mulroney) was out on the campaign trail; he was saying that virtually the day after the Conservative Government was elected there would be this swelling sense of confidence in the country, a sense of confidence in the ability of the new government, and that jobs, I think he said hundreds of thousands, would be created overnight.


Miss MacDonald:: He got 100,000 in the first month.


Nelson Andrew Riis: Maybe it was only tens of thousands of jobs that would be created overnight.


Mr. Blackburn (Brant):: We lost 80,000.


Nelson Andrew Riis: We have now been under this new Government for many weeks. That confidence does not seem to be boiling up. On the one hand the Government is saying this, and on the other hand the Government is saying that. The Minister of National Revenue (Mr. Beatty) says: "We are now going to treat people fairly. To do that we are going to hire 350 goon-squad members to beat the bushes to try to squeeze more tax from people". The reason people are not paying taxes out there is not because they do not want to pay tax. They are not
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tax evaders; it is because they do not have any money to pay. You cannot beat them over the head and bash out more money because people simply do not have it, Mr. Speaker.
We all know that when we go back to our constituencies every week we meet with people who say: "I owe Revenue Canada $16,000. I am a rancher. I do not have any money. I cannot pay it but I want to pay it. If I can come up with some kind of repayment plan, I will". When you say one thing one day and your behaviour is different the next day, it is not the kind of thing on which confidence is built, Mr. Speaker.
I want to say a little bit about how this Bill affects agriculture. My colleague, the Hon. Member for Prince Albert (Mr. Hovdebo), will certainly have more to say about what this Bill means for agriculture.


Derek Nigel Ernest Blackburn: Nothing.


Nelson Andrew Riis: I want to talk about the capital gains rollover to assist farmers in their retirement years that will enable a certain amount of money to be rolled into an RRSP and as a result be protected from tax as part of their retirement plans. One of the most encouraging parts of this Bill which will help many, many people is Clause 61. It makes the point that up until this time individuals who do not have income tax deducted at source have been required to pay quarterly tax instalments. Especially for pensioners, this has been a real problem. The quarterly tax instalment has also been a problem for many farmers and small business people. It is more red tape, to coin a phrase. It is something that will be eliminated, in part at least, by this provision, and I welcome that.
While there are some aspects of this Bill that have been long overdue, they are simply band-aids on top of band-aids on top of other band-aids. We have a tax system in this country that is so complex that I doubt there is a single tax accountant or tax laywer who could say that he or she is on top of the tax system. If anybody says that he or she understands the Tax Act, or is on top of the regulations, I think, Mr. Speaker, you should be looking for a new accountant or a new tax lawyer.
So much is based on decisions made by various tax officials. One might find a decision made in Ottawa that is quite different from one made in Winnipeg, which again is quite different from a decision made in Surrey, B.C. So much is dependent simply upon the interpretation of an individual for which he or she is not accountable. When you start looking at the tax system and recognizing the complexity in which we find ourselves in terms of the financial world, so much of income now being nothing more than paper income, we recognize that our tax system is out of control. It is unfair, particularly in that it has a bias toward a certain sector of the community. Of course, the bias is in favour of upper income earners, particularly those whose income is derived from sources such as dividends.
In fact, a dollar is not a dollar. For certain taxpayers a dollar is only 50 cents when it is looked at for tax purposes. It is time to dust off the covers of the old Carter tax report. We
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should look at some of its recommendations of a number of years ago. It was suggested at that time that perhaps it was time to bring fairness into the tax system and call a buck a buck or a dollar a dollar. For example, if one had a dollar of income, one paid income tax on it. We have called for a minimum tax recognizing, as even people like Ronald Reagan recognized in the United States, that there is a place for a minimum tax. Also there is a place for a tax system which is by and large based upon voluntary information regarding one's financial affairs for the year. We are asking people to co-operate in the most serious sense of the word. We are asking them to co-operate in determining moneys received, in identifying the taxes payable and in ensuring that the taxes are in fact paid. We ask them to co-operate as volunteers in this tax collection system. To have it work effectively, we must have a fair tax system. People filling out their tax returns must know that they are paying their fair share and that everyone else is paying their fair share as well. However, at present Canadian taxpayers know that that is not the case and that people often do not pay their fair share. They know that it is not a fair system and that it is biased in favour of certain individuals and businesses.
Turning to the business side of things, if we identify the 200 most critical tax incentives provided for business, the number set aside for small businesses is three; three out of 200 tax incentive programs designed for business refer to small business. Very clearly the emphasis or the bias in the tax system is toward the large corporate sector.
In terms of where jobs will be created in the future and recognition of the need for a fair tax system, Bill C-7 fails in moving toward either of those directions. It is simply a last ditch attempt by the past Liberal Government to bring in a few band-aids to be used on some obviously glaring errors in the tax system. Various sectors lobbied and lobbied for years for remedies to these errors. Finally government could not hold back any longer nor argue that this should not be done. Bill C-7 is a recognition of some of the most glaring examples of problems associated with the tax system. It does nothing to change it. It does nothing to improve the tax system. Basically it is the placement of a band-aid over another band-aid. That is all it really is.


Mr. Guy Ricard (Laval):: Mr. Speaker, I want to thank you for this opportunity to address the House on a subject as important as Bill C-7, an Act to amend the Income Tax Act and related statutes. The two previous speakers said that we more or less copied the Liberal Party's Bill C-107. Quite frankly, if that is the only thing they did right in twenty-five years, I do not see why we should not make a few changes and present it to the Canadian people.
Mr. Speaker, considering the precarious state of the economy, Canadians have no other choice but to opt for change, and that is what they did and they did so very wisely. The Canadian people chose a Party commensurate with its aspirations, a Party that would be able to promote sound economic
growth for all Canadians, after the dictatorial socialism practised by the previous Government which kept Canadians from realizing their full potential.
Mr. Speaker, juggling with truncated constitutional agreements is not enough to bring Canadians back to their rightful place within the Canadian economy. We must above all, think as Canadians, with Canadians and for Canadians. We must restore this country's pride, and that is what the Progressive Conservative Government has undertaken to do and is doing at this time.
However, although our Party is more than willing to do everything it can, it is a fact, Mr. Speaker, that the legacy of the previous Government has left us with a shambles-


Aideen Nicholson: Mr. Speaker, I rise on a point of order. Would the Hon. Member be kind enough to explain to us what connection his remarks have with Bill C-7?


Ramon John Hnatyshyn: That is not a point of order.


Derek Nigel Ernest Blackburn: He is supposed to be relevant.


Mr. Foster:: He is supposed to speak to the subject matter before the House.


Mr. Deputy Speaker:: Hon. Members are correct. It is a point of order-
[ Translation]
-and I would ask the Hon. Member to see to it that his comments are relevant to the Bill.


Guy Ricard: Mr. Speaker, as I was saying, our economic strategy will require the introduction of many changes, and I believe the Minister made this clear earlier, including the Act to amend the Income Tax Act and related statutes, which cannot be delayed any longer. As the House is aware, a number of tax measures require significant changes and fast action. It is therefore necessary to clarify our tax proposals as soon as possible, and that is what this Government intends to do by means of Bill C-7.
Mr. Speaker, the Government intends to make changes in the tax system as it applies to small businesses. These changes will have a positive impact, since they will simplify and shorten the corporate tax return, reduce the cost of tax compliance for small businesses, increase tax savings for expanding small businesses and also reduce by more than two-thirds the legislation on the low small business tax rate.
Mr. Speaker, changes will also be introduced to simplify the rules on personal services business, specified investment business and connected partnerships.
To qualify for the low tax rate, personal services businesses and specified investment businesses will no longer have to meet the criterion that they must have five full-time employees who are at arm's length. This will simplify compliance. For compa-
November 26, 1984

nies formed by corporations, the long and complex provision that deals with corporations that are connected with several companies will be replaced by an anti-loophole provision drafted in general terms. These changes in the small business tax system will apply to fiscal 1985 and thereafter.
However, a related measure dealing with control options will become effective starting fiscal 1986. The purpose of this measure is to prevent a corporation from being eligible as a private Canadian-controlled corporation if a non-resident or a public corporation has an option or the right to take control of the corporation. The year's grace provided before this measure becomes effective will give non-residents and public corporations now holding such rights or options a chance to reorganize their business so as to keep the corporation concerned eligible as a private, Canadian-controlled corporation.
Mr. Speaker, there will also be two changes in the rules on tax instalment payments. The first change will provide an exemption from such payments for individuals whose instalments will be $ 1,000 or less. At the present time, all individuals paying more than $400 in taxes must make quarterly instalment payments. Furthermore, the cut-off point of $1,000 will be extended to corporations. These changes will be effective as of fiscal 1984.
Roughly 350,000 older taxpayers will no longer have to pay tax instalments. For example, a married taxpayer over 65 who uses every interest income deduction will no longer have to make quarterly tax payments, provided the couple's income does not exceed $18,000. Another 130,000 Canadians and more than 50,000 corporations will no longer have to meet that requirement. Most of those corporations are small family businesses and farms.
An exemption will be made concerning interest due on late or insufficient instalments. Interest of $25 or less on late or insufficient federal and provincial tax instalments will be waived.
With respect to the operating costs of an automobile, the current legislation provides that the employee who makes personal use of a car supplied by the employer must include in his income the automobile benefits related to the operating costs, such as gasoline, repairs and insurance which are paid by the employer. He must also include in his income the benefit represented by the use of the automobile, commonly referred to as the standby charge in respect of the automobile. To figure out the benefit involved in operating costs, the employer must keep track of all expenses of each vehicle and distances travelled by each employee on a personal or business basis. This is a complex and time-consuming exercise and a simplified formula will make it easier to take this benefit into account.
For a great many employers and employees, combining the operating costs benefit and the standby charge in respect of
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the automobile will result in much fewer expenses for simply abiding by tax regulations.
As to moving expenses, the Income Tax Act now provides a deduction for such expenses when someone ceases to be employed and must move elsewhere in Canada to get a new job. This deduction will be available to anyone who was unemployed and moved after 1983 to get a new job or open a business.
At the present time, Mr. Speaker, alimony payments made before the date of a court order or a written separation agreement are neither deductible nor included in taxable income. A number of taxpayers who thought they could benefit from such fiscal reciprocity have been affected by this restriction. Generally speaking, that is the case of a taxpayer who makes maintenance payments to his or her spouse and children after the marriage breakdown, but before the formal separation agreement is signed.
The new provisions will amend the rules applicable to payments made before the date of a legal order or a written separation agreement when, if it were not for this date, the payments would have been deductible and taxable.
Taxpayers can now deduct, within prescribed limits, the payments made by their spouse under a Registered Retirement Savings Plan or RRSP. A special rule prevents the use of the spouse's RRSP to transfer income artificially from one spouse to another. According to this rule, when money is withdrawn from a RRSP by one of the spouses, the other spouse must include in his income any payment to this RRSP during that year and the two previous years.
The new provisions will state that this rule does not apply if, following a marriage breakdown the two spouses are living apart when the money is withdrawn. This provision will apply to the sums withdrawn from a RRSP after February 15, 1984.
As the Minister said earlier, Mr. Speaker, other issues will also be examined, such as charitable organizations, tax assistance to farmers, tax incentives for businesses, and so on.
To conclude, Mr. Speaker, these are some of the initiatives which we consider essential to meet our objectives. They reflect the honesty and integrity of a Government which has set for itself this goal of rebuilding our economy.
We are united by a common will to have a strong and prosperous country. Meeting this objective will improve the situation of every one of us. We can reach this goal if we all work together.


Mr. Deputy Speaker:: The Hon. Member for Edmonton South (Mr. Edwards) on a question or comment?


Mr. Edwards:: I have a comment to make, Mr. Speaker, if I may. I wish to congratulate the Hon. Minister of State for Finance (Mrs. McDougall) for her lucid exposition of these

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amendments and I would like to congratulate the analysis made by the Hon. Member for Laval (Mr. Ricard).
1 think it is fitting that the Hon. Member for Kamloops-Shuswap (Mr. Riis) made such a substantial contribution to this debate.


Mr. Nickerson:: He did?


James (Jim) Stewart Edwards: Yes. I think he underlined that neither the Government Party nor the Official Opposition holds a monopoly on wisdom and genius. It was a refreshing dose of fiscal and economic orthodoxy, with one or two exceptions. I know the Hon. Member would love to get his mitts on a chartered bank.
I wish to speak to one or two of these band-aids, as they have been called, and I would invite the Hon. Member to stay tuned. There may be some major elective surgery coming-


Mr. Deputy Speaker:: I would ask the Hon. Member whether he is making a speech or participating in the question and comment period following the speech of the Hon. Member for Laval (Mr. Ricard). We are dealing with questions and comments right now. Does the Hon. Member wish to speak during the ten-minute question and comment period?


James (Jim) Stewart Edwards: Mr. Speaker, I stand corrected. I was about to make a speech.


Mr. Deputy Speaker:: I will recognize you in a moment. Are there any Members who wish to make a comment or question the Hon. Member for Laval on his speech? Very well. We will resume debate with the Hon. Member for Edmonton South (Mr. Edwards).


Mr. McDermid:: It was a great opening.


James (Jim) Stewart Edwards: Thank you, Mr. Speaker. I will do it again if you wish.
These changes which have been introduced will simplify and shorten the corporate income tax form, will reduce the cost of tax compliance for small businesses, will increase access to tax savings for growing small businesses and will reduce by over two-thirds the amount of the legislation relating to the low tax rate for small business. As we have been told, this is accomplished by the elimination of the accumulated deduction account which limited access of the small business tax rate to $1 million of accumulated income. As well, this is accomplished by the repeal of the provisions concerning non-qualifying business; namely, the professional practices of accountants, dentists, lawyers and medical doctors. I beg to differ with the Hon. Member for Kamloops-Shuswap by stressing that among these professions are a number of substantial individual investors in our economy. Further, these objectives are accomplished by simplifying the provisions affecting personal services businesses, specified investment businesses and corporate partnerships.
The oil and gas industry, which should be the major engine of our economic recovery, will be pleased, I believe, by the
retroactive relief rather than the retroactive penalty involved in the provisions which offer relief to a taxpayer who, after 1983, disposed of property or supply services that qualified for earned depletion. As well, there is some measure of reliability and predictability in the scheduled modification of law treating expenditures made for wells after 1983 as development expenses rather than exploration expenses, thereby having the deduction from 100 per cent to 30 per cent postponed for two years to January 1, 1986.
The primary producers of our country are looked after and their needs are addressed by the tax assistance to farmers, with the farm capital gain rollover up to $120,000 of taxable gain on the sale of qualifying property now being deductible if invested in an RRSP, and the transfer of family farms from one generation to another has now been facilitated. The meaning of a child of a taxpayer has been extended and family farm bequests and inheritances are put on the same basis as inter vivos transfers.
As well, Mr. Speaker, I applaud the initiatives taken in the personal income tax field with the ability to deduct moving expenses extended. There are a great many people in our nation today who, through no fault of their own, have been dislocated from their employment, whether by early retirement or by lay-off. Clause 62 of the Bill will provide a deduction for the qualifying moving expenses of an individual who moves to a new location in Canada in order to take up employment or start a business. Under the present law, in order to qualify for that deduction the taxpayer must have ceased before the move to carry on a business, to be employed at another location in Canada, or to be a full-time student at a post-secondary educational institution. This amendment eliminates the requirements relating to the taxpayer's occupation before he moves. As a result, the amendment ensures that an individual who is unemployed immediately before such a move will be entitled to claim a deduction for moving expenses. The amendment is applicable to relocations which occur after 1983.
There is a bias in these amendments which is in favour of the great middle class of Canada-investors, entrepreneurs and those who care about the revival of the economy in Canada. I believe there is an all-Party consensus that small business will be the major generator of employment in the foreseeable future. I applaud the Minister for her initiatives and the attendant humanity, simplicity, efficiency and predictability that goes with the amendments. They are small steps in the right direction, but in them we see some measures for the freeing of enterprise and the reinforcement of the sense of confidence which is present in Canada today.


Mr. Deputy Speaker:: Questions and comments? The Hon. Member for Kamloops-Shuswap (Mr. Riis).


Nelson Andrew Riis: Mr. Speaker, I appreciated the comments of the Hon. Member and I look forward to his participation in this debate.
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In his opening statements he referred to the banks. I would like to ask him, first, what are his views with respect to a tax system which permitted one of the largest banks in the world, namely the Royal Bank of Canada, to operate in 1982, when most Canadians were experiencing extreme economic and financial difficulties, in a tax regime where absolutely no income tax was paid and millions and millions of dollars were deferred to the 1983 tax year? I would like to hear his views on a tax system which permits that.


James (Jim) Stewart Edwards: Mr. Speaker, I believe the subject of this debate is primarily the subject of small business simplification, relief for farmers, personal tax, et cetera. However, the subject was raised previously by the Hon. Member for Kamloops-Shuswap and, therefore, I will endeavour to answer the question.
Frankly, I do not think very much of a system which permits a major corporation not to pay tax-if the Hon. Member has his facts correct, and I will give him the benefit of the doubt. I think it is a declared policy of this Government that everyone will pay a reasonable share of tax. Of course, that includes corporations as well as individuals.


Nelson Andrew Riis: Mr. Speaker, the Hon. Member referred to an important part of the Bill, assistance to small business. He has identified, and rightly so that it is a critical sector in terms of creating jobs in the country in future years. He was also correct in saying that it was this sector which should be encouraged.
While this provision will take a significant amount of red tape out of the hands of the small entrepreneur and the small business person, would it not be much more advantageous for that individual, in terms of being able to expand and develop as a small-scale business, if the Government were to take action and significantly reduce interest rates?


James (Jim) Stewart Edwards: Mr. Speaker, I am of the view that the more free the market, the better.


Mr. Deputy Speaker:: On a further question, the Hon. Member for Algoma (Mr. Foster).


Maurice Brydon Foster: Mr. Speaker, when the Hon. Member gave his speech this morning it sounded as though this Bill was originally proposed by the Progressive Conservative Government. In fact, the Bill which is before the House is part of the Budget which was brought down by Mr. Lalonde last April 19. A number of changes were made to the tax system at that time, many of which the Tories castigated during the election campaign. Matters such as reducing the threshold for senior citizens who are required to pay quarterly tax, in order that they will no longer be required to pay income tax on a quarterly basis. In addition, the removal of the cumulative index for low-income tax levels in small business. That would reduce the amount of paperwork and taxes for small business by over $100 million a year. The Hon. Member mentioned that it favoured the largest sector of the income scale. It includes approximately 300,000 small business people.
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I simply wanted to be clear as to whether the Hon. Member was aware that the proposals in Bill C-7 originated from the Budget which was brought down last spring and did not come from the Economic statement of the Minister of Finance (Mr. Wilson). That statement put forward practically nothing for small business, except that the proposals of the previous Liberal Government would be implemented. Perhaps the Hon. Member could clarify whether he is aware that the beneficial provisions of the Bill came from the Budget of last spring.


James (Jim) Stewart Edwards: Mr. Speaker, 1 thought that I had given proper credit to the original initiative when I remarked that neither the Government Party nor the Official Opposition held a monopoly on wisdom or genius.
I believe that even the principles of the prodigal may be embraced when they are uttered as a last gasp of deathbed repentance. We recognized the marvellous improvement in Mr. Lalonde in his latter days.


Nelson Andrew Riis: Mr. Speaker, I have a further question for the Hon. Member. He referred to the elimination of the cumulative deduction account, which is certainly a wise move. Would he be able to venture an explanation as to why this special consideration was extended to certain selected professional groups, such as doctors, lawyers and accountants, to enable them to qualify for the 25 per cent tax? I recognize that the Hon. Member may not have an explanation and may be looking forward to an answer from the Minister of State for Finance (Mrs. McDougall).


James (Jim) Stewart Edwards: Mr. Speaker, I thought I previously addressed that question when I said that the people in these professions invest handsomely in the economy. They take risks which, I would submit, very few Canadians are prepared to take. I congratulate them on their bravery, especially with the state of the economy at this time, and in particular the western economy, with which I am sure the Hon. Member is very familiar.


Nelson Andrew Riis: Mr. Speaker, I do not want to pursue this beyond rational limits. I appreciate the point made by the Hon. Member that we need investment in this country, and, indeed, these professional individuals would probably invest in various capacities. However, what about all the other professions which are not identified? Is the Hon. Member saying that only the professional groups identified as lawyers, dentists and doctors invest in the economy and all the other professional groups which are identified in the Income Tax Act as professional groups do not invest? I do not understand why there is a distinction between one set of professionals and another.


James (Jim) Stewart Edwards: Mr. Speaker, following the band-aids probably will come the tourniquets; then later, as I suggested, the major surgery. I stress that that surgery is elective surgery because an election was held on the issue.


Mr. Deputy Speaker:: The period for questions and comments on the speech of the Hon. Member is at an end. We shall now resume debate.

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Dave Nickerson: Mr. Speaker-


Nelson Andrew Riis: Oh, no!


Dave Nickerson: Who said that? I suspect that remark came from the Hon. Member for Kamloops-Shuswap (Mr. Riis). My hon. friend, the Hon. Member for Edmonton South (Mr. Edwards), in my opinion, Sir, was all too charitable to that Hon. Member in his opening comments. I would never say anything like that about the Hon. Member for Kamloops-Shuswap because I have listened to him for several years in this House. I listened to what he had to say today with respect to Bill C-7, and for the most part, Sir, his comments were typical New Democratic Party tax garbage. The Hon. Member did, however, zero in on one particular group of Canadians-dentists, doctors and persons in allied professions. For some reason, obviously, the New Democratic Party do not like dentists.
If anyone has gone to a dentist of late he will have easily seen the similarity between a dentist's office and the ordinary small business. The dentist has a staff, he has equipment to buy and he has an office to run. It is my personal opinion, and it is the opinion of the Government of Canada, that there is not much difference between that type of operation and what we would normally consider to be a small business. Therefore, I am particularly pleased that the provisions of the Income Tax Act as they apply to so-called non-qualifying businesses have been repealed under this Bill.
The Hon. Member for Kamloops-Shuswap did make one valid observation, Sir, and that was that this bill is largely a Liberal Bill. To a great extent it comes to us as a result of the Budget brought in by the Hon. Marc Lalonde on February 15 of this year. That observation, which was also made by the Hon. Member for Algoma (Mr. Foster), was quite correct.
I believe what we are faced with in this Bill is a series of technical amendments to the Income Tax Act. There is no real change in the way that taxation will be levied in Canada. However, the amendments which are before us are, on balance, good ones, ones with which this House should deal as expeditiously as possible. In a sense, the February Budget of the former Minister of Finance was a way of drawing back from the disastrous MacEachen Budget of 1983. The Government of the day realized just how badly it had fared with the MacEachen Budget and in order to have a system of taxation with which Canadians could live, even if they were not particularly happy, brought in the Budget of February 15; and the Bill which was brought forward in August was the model for Bill C-7. There have been some improvements made in this Bill since August and we hope it will suit even more the present Canadian financial and taxation situation.
I am pleased that the Minister of State for Finance (Mrs. McDougall) brought this Bill in so early in the session. It shows that we on this side of the House intend to give high priority to tax matters. If one looks at the provisions of the Bill, one sees that they deal predominantly with small business taxation. The reason for this is that we believe that the small business sector of the Canadian economy is most important.
I would like to speak about some of the provisions as they affect small business. This Bill will reduce by over two-thirds the amount of legislation relating to low tax rates for small business. We, together with Hon. Members on the other side of the House, have been trying for some time to reduce the volume of the Income Tax Act and to bring in progressive simplifications.
Bill C-7 will increase access to tax savings for growing small businesses. It will reduce the cost of tax compliance, again for those small businesses. I like the provision for the elimination of the cumulative deduction account, and other speakers agree with me. Even the Hon. Member for Kamloops-Shuswap agreed with that provision so we must be doing something right on this side of the House.
The provisions dealing with the 35 per cent research and development credit and the 40 per cent investment tax credit are good. These provisions should assist investment in research and development on the part of small business. I am pleased to see that the working out computation will be dealt with on the previous year rather than on the current year in which you are claiming those tax credits, which makes it a lot easier. That is one simplification.
Some other provisions of the Bill which is before us include simplifications in the realm of taxation of charities. The Bill does not reflect the give-and-take proposals in their entirety. In fact, they reflect very little of the give-and-take proposals which have been made from time to time in this House. However, they are a step in the right direction and, as a step in the right direction, I am sure all Hon. Members of the House will support them.
There are provisions in the Bill which deal with employee stock options and the taxation consequences of giving employees stock options. I think this is, on balance, good. The intention here is to encourage stock options to be given to the employees of corporations so that they will have a vested interest in that business and will wish to see it grow and prosper. A lot of these recommendations came out of the good work of the parliamentary subcommittee which was established at the instigation of a private member of the Liberal Party in the last Parliament. Sometimes in this place we wonder whether anything eventually comes out of all the work we put into things, but this is one case where something came out of that parliamentary subcommittee. The lady who headed that parliamentary subcommittee and who originally presented the private member's motion to establish that committee is to be complimented, even though she is no longer with us.
With respect to taxation of energy and resources, the provision for recapture of depletion will assist people who invest in the oil and gas industries in Canada. There are provisions for the modification of the law which deals with expenditures after 1983 on certain wells, the treatment of them as development rather than exploration expenses, and the effect which that has on the deductions. I believe it is 30 per cent for development wells and 100 per cent for exploration wells. This is to be the changeover; it will be postponed for some two years until January 1, 1986. It will be a spur to the oil and gas industry,
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especially in western Canada which was hit so badly by the national energy policy.
The Hon. Member for Kamloops-Shuswap brought to the attention of the House the fact that these are minor modifications, and I do not think they go quite far enough. They are technical amendments that help things for the next couple of years or so, but we really have to look at the whole tax regime for exploration and development in the resource sector, oil and gas in particular, between now and 1986. We have to have something in place. It is all right to continue the present regime of PIP grants and so on until 1986 because people are locked into these programs and it would be unfair to rip up valid contracts. But we really need a new regime in Canada so that the oil and gas industry will know where it stands and will be able to make rational investment decisions based on the permanency of tax and other legislation dealing with the disposition of natural resource rights.
It will be a major task of this Government and this House of Commons over the next two years to bring in a new and steady regime to replace the existing situation which arose out of the national energy policy and a lot of other things that have upset both members of this House and the oil and gas industry for so long. I notice as well that this Bill contains a provision for a tax free roll over when, in certain circumstances, an individual transfers resource property to a taxable Canadian corporation. That will be helpful to people in that line of business.
I have a few comments, Sir, on tax assistance to people engaged in agriculture. Farmers have been having a particularly tough time over the last few years with low commodity prices and high taxes, expecially taxes on agricultural inputs such as farm fuels, et cetera. There have been a lot of discussions in the commons and in the country over capital gains taxes as they affect farmers. I am pleased with the amendments regarding the $ 120,000 amount not being subject to capital gains tax when it is rolled over into an RRSP, as well as certain provisions dealing with the transfer of family farms from one generation to another. This is a step in the right direction and something which all Members should support.
Of course, in the view of members from agricultural areas, it certainly does not go far enough. I was pleased to hear the Minister say that this matter will be referred to a parliamentary committee so that agricultural taxation, not only in respect of the Income Tax Act but customs duties and other types of taxation on agriculture, can be looked at again. Perhaps we can put a rational system in place.
By way of an aside, the three cents a litre tax rebate on farm fuels will come into effect as a result of the economic statement handed down in this House a couple of weeks ago. It certainly will be of assistance to farmers, fishermen and other people in the resource industry. As an aside to that aside, I would like to say that that tax rebate also ought to be extended to trappers. They were not specifically mentioned in the statement but they certainly are in the same line of business,
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renewable resource development, and the rebate ought to be extended to the fur harvesters of Canada.
We need a radical change in the taxation of capital gains in Canada, Mr. Speaker, not only for farmers. Sometimes it is hard for someone who comes from a non-agricultural area to understand the difference between a farm, which I look upon as being small business or in certain circumstances a large business, and any other type of business. I would like to see us get out of the capital gains tax business altogether. That would be the greatest spur to investment in Canada that we could imagine. I do not think the capital gains tax brings in any great amount of revenue in comparison with the difficulty it imposes on taxpayers. Very often we are collecting taxes not on real capital gains but on inflationary gains. So this Bill is good in that it alleviates the capital gains tax in certain specified instances dealing with agricultural land, but certainly it does not go far enough and we have to look at getting rid of it altogether in Canada and going back to the pre-Benson days.
The tax provisions of Bill C-7 extend to personal income tax measures and maybe I will just go over these point by point. The ability to deduct moving expenses has been extended. This has been brought to my attention on several occasions where people have moved from Newfoundland to the Northwest Territories. In my particular area of the country long distance moves are quite common.
Then there is simplification of rules applicable to the breakdown of marriage.
Another area concerns eligible medical expenses. As you will recall, someone had to be confined to bed or to a wheelchair before they were eligible to write off the cost of certain medically required equipment. I am pleased to see that will no longer be the case. I remember question after question being asked in this House about people who common sense would say should be able to get a tax deduction for a piece of medical equipment, yet the word for word provisions of the Income Tax Act were such that they could not. This is certainly a good step.
As well, fairness in tax administration, as the Minister of National Revenue (Mr. Beatty) has said on many occasions, both as Minister and as opposition critic, is something we feel very strongly about on this side of the House. We feel taxpayers should be treated honourably and fairly, and Bill C-7 contains provisions which will enable that to be done.
I see I am running out of time, Mr. Speaker, so I will have to speed up a little bit. Perhaps out of all the provisions dealing with tax administration I will simply pick two items. The one dealing with revocation of waivers I think is important. Once a waiver had been given there was no way of revoking it and in certain circumstances the taxpayer might feel that he or she would want to do that. So this is a good move.
We on this side of the House have been talking about award of costs for many years. I am pleased to see that it is included in the legislation before us today. Some taxpayers have

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incurred great expense and put a lot of time and effort into fighting tax cases. Some of those cases were brought by Revenue Canada in order to determine what the law was. I am pleased to see that there will now be a provision for the award of costs.
In summary, Mr. Speaker, these are mainly technical amendments. They have been a long time in the pipeline. Members on all sides of the House can be pleased with the input which they have had into this. It has been a combined effort by members on all sides of the House. I hope these provisions will be dealt with expeditiously in order that we can go from here to change the whole concept of taxation and address some of the matters which I have brought up in my presentation.


Mr. Boudria:: Mr. Speaker, I found the remarks of the Hon. Member for Western Arctic (Mr. Nickerson) very interesting. I have a question with regard to his proposal to abolish the capital gains tax. I recall that during a recent election campaign a certain candidate for Prime Minister said that the rich would "pay handsomely". Could the Hon. Member explain to us how "paying handsomely" fits in with abolishing the capital gains tax? Does the Hon. Member feel it is reasonable for a millionaire who owns paintings and sells them for 100 times his original investment not to pay income tax on that gain? That is the conclusion I am arriving at from what he is saying. After all, those kinds of sales are taxed only through the capital gains mechanism. Or is the Hon. Member proposing to replace the capital gains tax with some other method of payment through which the rich will pay handsomely, to use the expression of his Leader?


Dave Nickerson: Mr. Speaker, let us consider a few examples. In the days before taxation of capital gains there was a lot of incentive for prospectors to go out in the bush and look for showings. If a prospector found one mine in his lifetime he was doing much better than average. A lot of that incentive was taken away when capital gains taxes were introduced. The same is true with people who have accumulated a few dollars and want to build an apartment house. It is no longer as attractive to do that as it was in the pre-capital gains tax days.
As a result of that there are less prospectors looking for mineral showings. There are less people building apartment houses and this is showing up in the low vacancy rates in housing. I am sure that is happening in the Hon. Member's own riding. People are just not investing money in that area. Therefore, if we could reduce or eliminate the capital gains tax it would be good for Canadian society because people would make investments. People only invest if they think they are going to show a profit. They do not do it for fun. If we take away all the incentive that will not happen.
I suggested that this topic should be a prime one for discussion and examination during the course of this Parliament. There are certain difficulties with regard to transferring income into capital gains, so we must study it carefully. I make no apology for suggesting that in my opinion we would be
doing the nation a favour. We would be mobilizing capital and human energy if capital gains taxes were eliminated.


Nelson Andrew Riis: Mr. Speaker, as usual, I have listened to the eloquence of my colleague, the Hon. Member for Western Arctic (Mr. Nickerson). When he was in opposition on this side of the House he was very articulate in outlining the areas which the Government should change with regard to the tax system. Now, as part of the Government, he is in a position to implement these changes. Over the next weeks and months we will look forward to seeing these changes incorporated into the tax system to make it more attractive to the investor and to make it a fairer tax system.
I would like to remind the Hon. Member that the Department of Energy, Mines and Resources recently published a book about two inches thick which identifies all of the mineral resources which are sitting dormant and theoretically could be mined. Therefore, while his concern for the prospector is valid, there is another more pressing need, and that is to find ways and means of getting those deposits developed. I propose that the only way to do that is to take action on interest rates as opposed to leaving it to the free market place, as we have, in theory, at the moment.
The Hon. Member referred to the employee stock option section of this Bill. He suggested that this was going to provide an opportunity for employees to feel much more part of an operation. Would the Hon. Member explain how someone working for Imperial Oil who owns 20 shares of that corporation is going to feel that he is a meaningful part of that corporate entity?
The Hon. Member referred to tax collection and how the Government is sensitive to the need to be compassionate in the collection of taxes. Why was it necessary to spend millions and millions of dollars and hire 350 tax collectors to collect taxes? Does the Member see this as a way to develop confidence in the people of Canada and the small business sector? Will having more tax collectors badgering people to pay taxes develop a new sense of confidence in the country?


Dave Nickerson: Mr. Speaker, I wish that I had 20 shares in Imperial Oil. I do not think it really matters whether you have 20 or 2,000 shares in Imperial Oil, there is still an incentive attached. You own part of it and you can keep it or dispose of it. If you keep it and work harder, presumably you will see the value of those 20 shares increase. It is pretty obvious that unless you happen to be the chairman of the board or the president you are not going to have a great effect on the fortunes of a corporation as large as Imperial Oil. However, to deny that there is any effect whatsoever would be exactly the same as to deny that a Canadian citizen has no effect whatsoever on the Government of Canada when he or she casts that one vote out of 10 million.
A lot of corporations that give employees stock options are small corporations. Had the Hon. Member for Kamloops-Shuswap listened diligently to the presentations which were made before the parliamentary committee, he would have understood that. Very often this mechanism is used in much
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smaller corporations than Imperial Oil. I think it is valid not only for the small corporations but also for the large ones.

The second question dealt with the hiring of more employees for Revenue Canada. Perhaps it was wrong to describe the extra employees as tax grabbers. There will be a lot of people required in the operation of Revenue Canada.
One of the difficulties we have now is that the people who have been employed there have been overworked. Anyone who has tried to call up the Department of National Revenue to make an inquiry with respect to an assessment or whatever knows that one cannot get through. I tried this once as an experiment. I attempted to call Zenith 4000, the office in Edmonton. I tried ten times and let the phone ring about 20 times on each occasion. It is just impossible to get through.
Many of these new employees will not be going out hounding people to pay their taxes but providing the service that taxpayers require. We will now have people who will be able to meet with a delinquent taxpayer and work out a schedule for repayment rather than just going in with a garnishee stamp. The idea behind hiring more people for the Department of National Revenue is to make the tax system more fair and equitable and to provide services that the taxpayers require.


Mr. Deputy Speaker:: The period for questions and comments being over, we will resume debate.


Mr. Stan J. Hovdebo (Prince Albert):: Mr. Speaker, this Bill is as important in terms of what it does not do as much as what it does provide. It makes no effort to deal with some of the real inequities and unfairness in the tax system.
The Bill addresses some of the necessary changes that are required in the tax system. These matters have been discussed on many previous occasions by Conservatives when they were in opposition and by Liberals when they were in government. It is surprising to note the changes in attitude with respect to some of these clauses. However, that seems to reflect the kind of political structure we are in. Bill C-7 does not deal at all with corporate capital giveaways, nor does it address the increasing number of loopholes within the system.
My colleague who spoke earlier suggested that there are many Canadians in this country who pay no tax at all. There is no attempt in this Bill to deal with those people, whose numbers are growing every year. In 1971 there were only eight people who made over $100,000 and paid no tax at all. By 1981 that number had increased to 1,490. The reason for this increase of almost 1,500 people who pay no tax is that there have been more and more loopholes introduced into the tax system to allow them to do so. I believe it is the Government's responsibility to review the tax sytem, to make sure that this no longer happens and that those people are taxed in some manner.
The Hon. Member for Western Arctic (Mr. Nickerson) spoke about capital gains and suggested that this was one possible method for increasing the amount of investment.
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However, I would also point out to him that within the present tax system it is also a method for increasing the number of people who make more than $100,000 or $200,000 without having to pay any tax at all.
The capital gains structure as it presently exists is very unfair. The Hon. Member for Western Arctic made some very valuable comments about the need for studying capital gains and how this should be done. One of the inequities of capital gains is that one pays taxes on only half of one's capital gains, whether it is $50,000 or $500,000. You pay only on half, as if you had earned that same amount of money working. This Bill does not deal with that unfairness which has been built into the system.
It has been our view that during the past decade, while the government systematically increased spending to provide a government that cared about the people, at the same time it proceeded systematically to diminish the tax base. Consequently, that reduction in tax revenues has resulted in the kinds of deficits that we now face. The Government must now look at ways to restore that tax base which has been lost over the past 20 years. Most of that tax base has been lost as a result of tax credits to large corporations.
I am particularly interested in the attempt in this Bill to achieve some fairness for farmers. I speak particularly about that portion of the Bill which allows RRSPs to be purchased by farmers who are selling their farms and the rollover provisions for farms moving within the family.
The Conservatives came to Prince Albert in large numbers to reveal the Prince Albert manifesto. They promised real relief from the farm financial situation and have taken a couple of steps in that direction in this Bill. However, the Government has not yet made an effort to deal with the main problems facing the farming community.
Be that as it may, I am pleased that this Bill has revived the measure from the previous Bill to provide an opportunity to farmers to buy RRSPs for half of the capital gains, up to $120,000. It has been widely stated that in many cases the capital that a farmer has developed in his land is the only retirement capital he has. Consequently, he needs a mechanism that will allow him to use that capital without much of it being siphoned off for tax purposes. I congratulate the Government for introducing such a mechanism.
The Prince Albert manifesto addressed a number of other important issues which needed consideration. The Minister has indicated that these were up for study, but many of these have been studied before. I think the Conservative Party when in opposition put forward a very acceptable approach to Section 31 of the Income Tax Act and the inequities which caused farmers a lot of trouble in the last few years.
In this Bill there is a definition of a full-time farmer. I suggest that later on in Committee of the Whole deliberations it will be necessary for the Government to define exactly what it means by a full-time farmer and exactly what it means by that ability to purchase RRSPs. Over the last four or five

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Income Tax Act
years the definition of a full-time farmer and a part-time farmer has become so involved, that they are so difficult to define, that no farmer who happens to work off the farm for a period of time really knows how he is going to be classified. Will this definition allow a person losing money, one who has to work off the farm, to take advantage of the RRSP situation?
We have heard from this Government about what it is going to do to help relieve the financial problems of farmers. We are looking forward to a little more action than we have in this Bill. Up until now we really have had nothing which amounted to a great deal of action to help farmers with their financial problems.


Mr. Deputy Speaker:: Are there any questions or comments? If not, we will resume debate.


Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, this is clearly an attempt on the part of our Party to make certain that the changes that go through as part of Bill C-7 do not do so in some kind of automatic and carefree way, but instead become subject to scrutiny and a general discussion about the direction in which we should be proceeding in tax policy. This is, after all, the first piece of legislation that has come before us from the federal Government dealing with the tax system. For ourselves we have felt that the priority in the tax system should be to bring in measures that establish some serious move toward fairness, some real advance toward a system that treats ordinary Canadians in at least as equitable a way as the many rich taxpayers who benefit from so many loopholes and the many corporate and personal tax advantages that allow them to escape from paying their fair share of the tax burden.
We as a Party would have brought in for priority action not the discredited past regime's efforts at some small tax changes, which were efforts many members of the Conservative Party attacked. We would have aimed to bring in changes that started to establish once and for all through at least a series of dramatic gestures a new sense in the country whereby Canadians can look forward to a tax system which is fair and just instead of a tax system which is unjust, unfair, and incredibly complicated.
We would first have moved to do something about the incredible tax breaks for the corporate sector of the economy. We would look at capital allowances provided to companies over and above the normal depreciation which can be taken off a company's corporate income. We would look at the very fast write-offs which have been provided for new investment, fast write-offs given automatically, not given to projects that otherwise would not go forward. For instance, there are the regional industrial development expansion grants which go only for specific jobs in a context where companies would not otherwise move forward. We would look at the very fast write-offs for exploration and development within the resource sector. We have seen the way in which these have increased dramatically. We have seen the conclusions of economists, quite universal on this matter here in Canada, that this attempt to funnel more
money to the corporate sector has not resulted in increased jobs. It has not even resulted in increased business investment in Canada. Instead we have seen a slowdown in investment. Despite the incredible tax breaks, we have seen the corporate sector really not establishing new jobs for Canadian workers.
We think there has to be action on the very high level of tax advantages provided the corporate sector here in Canada. That is not because we do not want to see serious efforts made to help the business community establish more employment for Canadians. We have been the people who have defended programs like the industrial and regional development program against the significant cut-back of planned expenditures which this Government has recently initiated. We believe that the way the corporate tax system has been used to provide a whole set of automatic tax credits, not related to performance, does not make economic sense. It is not fair, it is not effective, and it should not be happening.
We feel the priorities of this Government with respect to tax avoidance are simply wrong. The Government has hired a significant number of new tax inspectors to go after ordinary Canadians. At the same time officials admitted privately before the changes in secrecy rules which will make it a little more difficult to do so in the future that the largest source of tax avoidance, tranfer of payments made by corporations outside this country, do not receive the scrutiny they should.


Mr. Deputy Speaker:: I am sorry to interrupt the Hon. Member, who will of course continue after the recess, but it being one o'clock, I do now leave the chair until two o'clock this afternoon.
At 1 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.


Mrs. Lucie Pepin (Outremont):: Mr. Speaker, last week, the Minister of Employment and Immigration (Miss MacDonald) tabled the annual report on future immigration levels. I am somewhat skeptical, since I am afraid this report shows a drastic change in our immigration policy, a change for the worse. In my humble opinion, the Progressive Conservative Government is about to give up our traditional humanitarian stance for a more opportunistic one, by favouring the more
November 26, 1984

prosperous immigrants to the detriment of certain less fortunate groups.
The new economic direction the Minister of Employment and Immigration seems to be adopting is an alarming one. From the moral point of view, it is unacceptable to continue to close our doors to workers and selected workers, because after all, their ancestors built this country when it needed them to clear the land and do backbreaking labour. At the time we did not care whether immigrants had thousands of dollars to invest. Today, now that Canada is developed and is gradually recovering from the recession, must our admission criteria be financial ones, from now on?
If that is the case, it denotes an attitude that is to be condemned, because it ignores those people who are trying to join their family members in this country, while there are also thousands of people for whom Canada could be a place of refuge and provide a better life.



NATIONAL DEFENCE


Dave Nickerson: Mr. Speaker, recent reports would have it that Cruise missiles might again be tested in Canada this coming winter. There were several complaints last winter dealing with inadequate notice to civil aviators along the test route which traverses the western Northwest Territories and northern Alberta. In order to avoid unfortunate accidents, civil aviation should be advised well in advance of the time, date, and route of missile tests. Also the altitude and speed of the missile and the tracking aircraft should be published. The Department of Transport ought to issue NOTAMs with this information, not at the last minute but sufficiently in advance of the tests so that the many pilots and passengers who regularly travel along the test route will not be placed in any unnecessary danger.



TRANSPORT


Don Boudria: Mr. Speaker, some Hon. Members on the government side seem to be both confused and divided. With the apparent support of the Hon. Member for Ottawa-Carleton (Mr. Turner), the Hon. Member for Gatineau (Mrs. Mailly) has decided that a bridge would be built between Masson (Quebec) and Cumberland (Ontario) and that a preliminary study would be started very shortly, with the approval of the Minister of State for Transport (Mr. Bouchard). On the other hand, the Hon. Member for Argenteuil-Papineau (Mrs. Bourgault) has made the following statement, as reported in the Le Droit daily:
If such a study ever takes place, it will certainly not be funded by Ottawa, for this bridge has never been listed among the government's priorities.
Are we witnessing a tempest in a teacup? Knowing the atmosphere of secrecy within which this government likes to operate, I suggest that one of its Hon. Members should at least have the decency to tell the other the time of day, unless this is a case of two Hon. Members fighting to get the upper hand. Is the government going to clear up the matter, or will he let fate decide on the taxpayers' backs whether or not we will get a bridge or a study? The Deputy Prime Minister may be the only one who knows the answer to this question, but alas, as you know, Mr. Speaker, he was struck by a strange disease on September 4 which has rendered him totally mute.
Mr. Speaker, this rightist government is acting awkwardly, and it is clear that one right hand does not know what another right hand is doing.



CANADIAN RADIO-TELEVISION AND TELECOMMUNICATIONS COMMISSION SUSPENSION OF CABLEVISION PROSECUTIONS

Nelson Andrew Riis: Mr. Speaker, I wish to bring to the attention of the Minister of Justice (Mr. Crosbie), the Minister of Communications (Mr. Masse), and Members of the House, a situation which has serious implications regarding confidence in the Government. Last week the Government stopped all prosecutions against cablevision operators who had ignored the regulations of the CRTC. In some of the communities involved, legitimate licensed cablevision operators who had sought and obtained CRTC recognition, and who had met all the rules and regulations contained in their licences found themselves in competition with cable operators who were operating without CRTC approval. Until recently the Department of Justice had decided to prosecute those cable companies operating in contravention of the CRTC in recognition of the legal, legitimate, and licensed cable operators, but now the Department has stopped the prosecution process.
What signal does this send to licensed cable operators? How is the licensed cable operator able to compete in such an unfair market situation? I would ask the two Ministers involved to take immediate action to stop the stay of prosecution, especially for those communities where a licensed cablevision firm is operating in competition with an unlicensed firm.

November 26, 1984



ABORIGINAL PEOPLES


[Stage Direction]
Mir. Thomas Suluk (Nunatsiaq): Mr. Speaker, the Inuit, who comprise 85 per cent of my riding, have gone through a period of tremendous cultural upheaval for the last 20 years. Although all 33 communities can now boast of modern conveniences such as education, public housing, and satellite television, the appearances are misleading. This weekend another Inuk youth terminated his own life in frustration at coping with the laws of the land.
This is not an isolated case. Many of these unfortunate events take place in communities where cultural clashes are the greatest. Many young Inuit are finding it more and more difficult to cope with modern problems affecting the North, where jobs are few and far between. The problem is compounded by the fact that our young Inuit can no longer live off the land like their predecessors.
Although many Inuit leaders are trying to address this problem, they are hampered by a lack of funds for effective programs. I am therefore calling upon the Minister of Employment and Immigration (Miss MacDonald) and the Minister of State for Youth (Mrs. Champagne) to look into the serious problems confronting Inuit youth in the riding of Nunatsiaq.


Steven W. Langdon: Mr. Speaker, the International Development Research Centre is one of the country's most important agencies which helps developing countries. Set up in 1970, it has built a fine reputation by helping research in poor countries into agricultural problems, health concerns, and social and economic issues. The annual budget of IDRC is in the $80-million range. Now, as a result of the Government's cuts, $10 million has had to be chopped from this year's budget. This is tragic for the poorer people of developing countries, sad for the international reputation of our country, and extremely demoralizing for IDRC staff.
It is especially tragic that these cuts hit IDRC this year as it is especially active in helping increase food production in Africa. A special focus has been on Ethiopia, where IDRC help has been going to the Institute of Agricultural Research and its Commission on Science and Technology to find more drought-resistant crop varieties and low-cost farm improvement systems.
We urge the Government to stop these cut-backs. The tragedy of African hunger cries out for more Canadian support through IDRC, not less.



METRIC CONVERSION


Mr. Gordon Taylor (Bow River):: Mr. Speaker, Sir John A. Macdonald was a great Canadian and a splendid parliamentarian. His legislation reflected the thinking of the great majority of his people. For example, both metric and imperial were placed in the statutes, and Canadians could use the one of their choice. As a result we have a metric money system, and imperial is used in measuring land. This made sense to the rank and file of the nation and to everyone else, that is, until the last Liberal Government came along. It said: "This freedom of choice is too simple. We will force everyone to use metric".
It was sensible where small measurements were used, such as in medicine, but completely stupid to change an excellent system of land surveys. That did not bother the Liberals; it fitted right in with their totalitarian concept of telling the people what was good for them. Scores of farmers exclaimed: "We are foreigners in our own land. We don't know how much we are getting for a bushel of wheat any more". Shoppers were dumb founded, not knowing how many pounds of meat they were getting for their dollar.
The simple fact is that there is a place for metric and a place for imperial. The people should make the choice, not the Government. Canadian people are not illiterate-they will not be changing acres to hectares, or bushels to hectolitres.
This Government will restore sanity to our weights and measures by following the example of that great Conservative Prime Minister of the past and doing what the people want. Down with compulsion, and up with the people!


Some Hon. Members:: Hear, hear!



GUELPH GRYPHONS VICTORIOUS IN VANIER CUP FINAL

Mr. William C. Winegard (Guelph):: Mr. Speaker, if the House would quieten down, I would deliver a significant message.


Some Hon. Members:: Oh, oh!


William C. Winegard: Last Saturday the attention of many Canadians was focused on a contest witnessed by the Governor General of Canada and the Hon. Minister of State for Fitness and Amateur Sport (Mr. Jelinek). I wish to assure the House that the contest was well played and was a credit to Canadian university sports.
I also wish to assure the House that the Vanier Cup will be well looked after in Guelph. I regret that the rules do not allow me to congratulate that fine team.


Some Hon. Members:: Hear, hear!
November 26, 1984



ABORTION


Mr. John V. Nunziata (York South-Weston):: Mr. Speaker, the acquittal of Dr. Henry Morgentaler has made a mockery of our jury system and is clear evidence that our abortion laws require immediate review to ensure more protection is given to the unborn. The acquittal is a serious indictment of the integrity of our criminal justice system. How can anyone have confidence in any justice system when a self-confessed criminal gloats over being acquitted after having committed a crime?
Abortion is wrong, Mr. Speaker. Human life is precious. From the moment of conception, life begins, and absolutely no person has the right to take that life under any circumstances. It is uncivilized and indecent for a nation to condone murder in whatever form, and in my view, abortion is murder.
While visiting our country, Pope John Paul II had this to say about abortion:
This unspeakable crime against human life which rejects and kills life at its beginning sets the stage for despising, negating and eliminating the life of adults and for attacking the life of society.
I call on the Government, Mr. Speaker, to amend the Criminal Code to afford greater protection for the innocent unborn of our society, and to petition the Province of Ontario to appeal the Morgentaler acquittal immediately. To do otherwise would be to breed disrespect for the rule of law and the sanctity of life.




Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, I too rise to make a few comments with respect to the acquittal of Dr. Henry Morgentaler by a jury in Toronto. I believe it is time that Parliament recognized that Canadians demand a change in this unjust law. Four times Henry Morgentaler has been tried before a jury and four times he has been acquitted. When will Parliament recognize that the fundamental decision on the question of abortion should be left to a woman in consultation with her doctor?
I disagree fundamentally with the views of the Liberal critic of the Solicitor General's Department with respect to this matter, and I urge Parliament to recognize that the present law is unworkable. The law has resulted in delays being faced by women from rural areas and women in areas which do not have therapeutic abortion committees. Those delays can in some cases endanger the life of the mother.
The present law is unworkable. Rather than returning to the days of the dark ages as advocated by the Liberal Member, I suggest that we move forward by repealing the provisions of the Criminal Code and listening to the voices of Canadians who are crying out for justice in this area of the law. I believe
Oral Questions
that Henry Morgentaler has blazed a path for Canadian women. He has been tried and has served time in jail. I think it is about time that Canadian Members of Parliament recognized that this law should be repealed.



DEPARTMENT OF ENERGY, MINES AND RESOURCES PROPOSED RELOCATION OF OFFICE FROM SUMMERS1DE. P.E.I., TO CHARLOTTETOWN

Mr. George Henderson (Egmont):: Mr. Speaker, last week the people of my riding were given the unwelcome news that Prince Edward Island's conservation and renewable energy office is being moved from Summerside, which is in my riding, to Charlottetown, which is in the riding of the Minister of State for Tourism (Mr. McMillan). To the people of my area this means a loss of 12 federal jobs, in an area in which federal jobs are a real rarity.
Prince Edward Island is in the unfortunate position of having to rely on oil as an energy source, and this results in islanders having to pay the highest energy costs in Canada. The CHIP and COSP programs which are being abandoned by the Government are very important to the people of my riding and to the people of Prince Edward Island as a whole. There are still many islanders who have not yet been able to afford to participate in the programs and it now looks as though they will not have the chance to do so.
I have two problems associated with the Government's change in policy. It is costing the people of my riding both jobs and higher energy costs, in a province in which energy costs are the highest in Canada. Therefore I would ask that the Minister reconsider both the move of the energy office and the abandonment of these programs.



ORAL QUESTION PERIOD


Hon. Jean Chretien (Saint-Maurice):: Mr. Speaker, my question is directed to the Right Hon. Prime Minister.
In the light of the new directives issued by the Prime Minister last Friday, concerning communications between the Public Service of Canada and reporters and the Canadian public, could the Right Hon. Prime Minister inform the House whether, before making this decision, the Government, as it has since the beginning of this session, used the word "consultation" as its theme, and could the Right Hon. Prime Minister

November 26, 1984
Oral Questions
inform the House whether his Government consulted the press gallery, the institutions that communicate with the public and the Public Service unions, before issuing directives that effectively prevent any communication between public servants and the Canadian public?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, of course the end of my hon. friend's question is entirely erroneous. The purpose and in fact the wording of these directives is such that we are trying to expand communications, not restrict them. I think the person in charge of communications in my office had a meeting with the president of the press gallery. 1 do not know whether other consultations are taking place, but I know there have been several.


PRIME MINISTER'S POSITION
Joseph Jacques Jean Chrétien: Mr. Speaker, I would like to ask a supplementary question of the Right Hon. Prime Minister. In his book entitled Where I Stand, the Right Hon. Member indicated that all of the briefing papers related to the development of any policy should be made public. How can it be that he can write such a thing before the election campaign, but today he will not permit any bureaucrats to deal off the record with background information? How can the Prime Minister not allow bureaucrats to give the press background information about the different political options faced by the Government at the time of making certain decisions? How can the public understand these policies if bureaucrats cannot say anything without being quoted in the press?


Martin Brian Mulroney: Mr. Speaker, I am delighted that my hon. friend has read my book. However, it is clear that he did not read the guidelines. While I acknowledge that the guidelines are not perfect, they are designed to be helpful and to be open. The public servants are not there either to defend or criticize government policy. Pursuant to their oath, public servants are there to explain policy objectively at all times. The guidelines provide for that in abundance. Moreover, in the spirit of openness, they suggest to public servants that they ought to feel completely free in regard to their comments, and to be on the record and be quoted. That is consistent with a policy of openness. Those guidelines were prepared not with a view to shutting down communications but to opening them up and placing them in a reasonable perspective, and that is all they were about.


RESPONSIBILITY OF PUBLIC SERVANTS
Joseph Jacques Jean Chrétien: Mr. Speaker, if a bureaucrat were to decide to give some background information to the press that would show to the press and to the Canadian public that there were flaws in policies but that there were ways to remedy the situation by giving the public different options, can the Prime Minister give the House the guarantee that this bureaucrat would not be penalized by curtailing his advancement in public life?


Martin Brian Mulroney: Mr. Speaker, if a public servant found a serious flaw in public policy, then, pursuant to the oath taken by that public servant, he should inform the Minister of it and not anyone else. That is his responsibility and that is what parliamentary democracy and a sense of responsibility are all about. We are trying to ensure that that public servant, if contacted by anyone, quite freely and objectively explains government policy in the manner that he feels is appropriate, without any recrimination or reprisal by us. It is an invitation to public servants to feel free to go on the record, in those areas where they are responsible, to explain public policy and to do so with the full knowledge that they have the backing of the Government and the House of Commons.


PRIME MINISTER'S LETTER TO MINISTERS AND DEPUTY MINISTERS
Hon. Herb Gray (Windsor West):: Mr. Speaker, the Prime Minister just said that public servants are to feel free to speak to the public. In answer to another question raised by my hon. friend, he said that the guidelines, while not perfect-the understatement of the century-are designed to assist public servants to be helpful and open, and that they should feel completely free and open. Could the Prime Minister explain to the House why, in his letter to Ministers and Deputy Ministers, he said the following:
-Ministers have also agreed on the need to review with their Deputy Ministers the current communications policies, procedures, resources, and management structures within their departments to ensure that communications with the public is managed effectively in accordance with the priorities of the government.
Why does the Prime Minister, in his letter to his Ministers and Deputy Ministers, place the management of the news in accordance with his priorities above the openness he now says is important?


Martin Brian Mulroney: Mr. Speaker, I could respond to that if I had been accurately quoted. That is a distortion of not only the letter but the spirit of my communication to Deputy Ministers. Indeed, we inherited a situation of unprecedented secrecy which was imposed on the Public Service by the previous Government. We are trying to correct that in a manner which is fair to public servants to ensure the integrity and independence of the Public Service. That is what we want to do.


OFF-THE-RECORD BRIEFINGS
Herbert Eser (Herb) Gray: Mr. Speaker, I want to assure my hon. friend that my intention was to quote verbatim from the letter which was published on Friday. My remarks can be compared with that letter.
If the Prime Minister is saying that he wants to change what he alleges was unprecedented secrecy by the preceding Government, why did he do something to change the guidelines followed by the preceding Government, the same guidelines
November 26, 1984

which were put in place by the last Conservative Government; why did he make a change which would take away the right of officials to have off-the-record briefings without the specific consent of the Minister? That gag was not in the preceding guidelines. So much for his claim of taking away unprecedented secrecy. He has added to it; he has not taken it away.


Ramon John Hnatyshyn: That was not a question.


Mr. Speaker:: The Hon. Member for Burnaby (Mr. Robinson).


Some Hon. Members:: Question.


Mr. Speaker:: Order. The Hon. Member for Burnaby.


IMPLICATIONS OF GOVERNMENT POLICY-APPLICATION OF GUIDELINES TO PUBLIC SERVANTS
Svend Johannes Robinson: Mr. Speaker, my question is directed to the Prime Minister and is also with respect to the guidelines. Although the guidelines are an invitation to the Public Service to openness, apparently the Public Service Alliance of Canada has accused them of being a gag on their freedom of expression.
As the Prime Minister is well aware, public servants in the past have frequently been prepared to discuss the possible future ramifications of various public programs and policy decisions which have been taken by the Government with respect to jobs, implication for services and so on, after the programs have been announced.
I want to ask the Prime Minister to assure the House and the Canadian people that the guidelines announced on Friday last will in no way impede the possibility for public servants to discuss, both with the media and Members of Parliament, the possible implications for the future of policies which have been announced by the Government. Of course I am assuming that such discussions would be on the record as per the guidelines of the Prime Minister.


Martin Brian Mulroney: Mr. Speaker, I would be happy once again to provide that assurance. It was covered generally and, I believe, properly in the guidelines. Those guidelines are to be read in conjunction with my letter to Ministers and Deputy Ministers. The spirit of what we were trying to do is not inconsistent with the point raised by my hon. friend.


ECONOMIC STATEMENT-REQUEST FOR RELEASE OF BACKGROUND PAPERS
Svend Johannes Robinson: Mr. Speaker, I am certainly pleased to receive that assurance from the Prime Minister. In light of that assurance and the commitment to openness, the recent financial statement made by the Minister of Finance involved a series of cuts in services and increases in taxes which were very similar to the program of the Social Credit Government in the Province of British Columbia.


Mr. Speaker:: Is there a question?
Oral Questions


Svend Johannes Robinson: I would like the Prime Minister to indicate whether any background studies or background papers were prepared to discuss the impact of the cuts in services and increase in taxes. If so, in light of the assurance which the Prime Minister has given to the House, is he prepared to make those documents public?


Mr. Speaker:: I will now take the opportunity to remind the House of two things. First, a supplementary question should be supplementary to the first question. Second, there are rules in the House about continuing repeatedly to ask a question which has in the past been answered. In this case, on the basis of the first issue, it is not supplementary to the first question and I will not allow the question.
The Hon. Member for Gauthier.


Some Hon. Members:: Oh, oh!


Mr. Speaker:: It is a good thing I do not record the votes. The Hon. Member for Ottawa-Vanier (Mr. Gauthier).


REQUEST FOR GUIDELINE DETAILS
Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, 1 have a question for the Prime Minister. He stated that the guidelines would clarify the situation, but I submit to you, Mr. Prime Minister, that matters are getting more and more confused. Could you first give us the names of the three commissars, the triumvirs, the troika, the three musketeers you have appointed as substitutes for the President of the Privy Council? Their names first. It is important that we know them, because the newspapers do not seem to have much of an idea who this threesome will be. Second, could you supply us with a list of departmental information officers, their telephone numbers? All this is factual information, simple information-the names and telephone numbers of all those people, in order that we may phone them. And finally, have they been authorized to speak to reporters and Members of Parliament?


Martin Brian Mulroney: Mr. Speaker, I would like to inform the Hon. Member for Jean-Robert that the names of the three ministers have been made public. They are the Government House Leader, the Minister of Communications and the Minister of National Revenue, if I remember right. As for the names and telephone numbers referred to by the Hon. Member, they are all listed in the Government Telephone Directory.


UNAUTHORIZED OFF-RECORD REMARKS
Jean-Robert Gauthier: I have a supplementary, Mr. Speaker.
Obviously, Mr. Speaker, the Prime Minister is playing hide and seek.

November 26, 1984
Oral Questions


An Hon. Member:: He is skating.


Jean-Robert Gauthier: He is used to playing hide and seek with figures. I wonder whether the Prime Minister could tell us if actually-

Does he really trust public servants when he imposes guidelines which state that off-the-record remarks will not be allowed unless authorized? What will happen to a public servant who speaks off the cuff to me as a Member of Parliament, or to a member of the media?


Martin Brian Mulroney: Mr. Speaker, in my experience public servants are all very prudent and able people. It would be unlikely for them to speak off the cuff to the hon. gentleman.
The question was raised in the press conference as to how we propose to police the guidelines. The answer is, there will be no policing. We trust in the integrity of public servants.


Some Hon. Members:: Hear, hear!


DEPARTMENTAL BUDGETARY CUTS-INQUIRIES ABOUT EFFECTS
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, my question is directed to the Prime Minister and is on the same subject matter. I listened with interest when the Prime Minister stated in answer to an earlier question that, in his view, the guidelines would permit public servants to talk about the future impacts of government policy in an open, on-the-record way. I think that is commendable.
Since a number of Departments-for example, the Department of Employment and Immigration which will have $400 million cut out of its budget, the CBC which will have an $85 million cut, and the Department of the Environment which will be cut by more than $30 million-will have job impact implications for the future, assuming these assessments have been done, and assuming what he said will be the case, that public servants will be able to talk about future impacts in a factual on-the-record way, will the Prime Minister assure the House that when questions are put about these matters factual answers about impacts in those areas will be given?


Martin Brian Mulroney: Mr. Speaker, the public servants are completely free to explain government policy. That is what was stipulated and has been the case. All we are asking, to ensure objectivity and protection for the Public Service, is that this be done pursuant to these guidelines. It is not in any way intended to do anything other than, first, to ensure the right of the public to know and, second, to ensure the independence and impartiality of the Public Service.


IMPACT STUDIES
John Edward Broadbent: Mr. Speaker, I repeat, it is encouraging so far, but let us be more precise. In the case of the CBC an $85 million budget cut has been announced, and in the case of Employment and Immigration $400 million has been cut. Specifically, have impact studies been done within these Departments-I assume they have been-on the consequences of these cuts and what parts of the programs are going to be affected? And, if so, is the Prime Minister now telling the House that if an inquiry is made, either by the media or by a Member of Parliament, we will be able to get that impact information from a civil servant?


Martin Brian Mulroney: No, not at
all, Mr. Speaker. What we are saying is that government policy, and this has always been the case in this country, once fairly arrived at by the duly elected Government of Canada, is explained by public servants, is defended by the Government, and is criticized by the Opposition. The Public Service is there to explain the policy of the duly elected Government.
I am sure my hon. friend quite understands the impropriety inherent in his suggestion because it would effectively paralyze the Public Service in its right and obligation to provide Ministers with unfettered and unvarnished advice. I am sure the Hon. Member, given his respect for the parliamentary system, would not want to paralyze the operations of Parliament in that way. We want to protect the public servants. We want to make sure they are not criticized for being political, and we do not want to politicize the Public Service. That is why the protection is described in the manner in which it is.


Some Hon. Members:: Hear, hear!


BUDGET INFORMATION QUERY
John Edward Broadbent: I say to the Prime Minister that he cannot have it both ways. He cannot, eight minutes ago, say that civil servants can give information about impact in the future, and eight minutes later say: "Well, if you are going to be specific, they cannot". Either the Prime Minister is for open government, freedom of expression within the parliamentary system, or he is not.
The Prime Minister must make himself clear. Is he now telling the House that the kind of information which has been traditionally provided with budget documents in the past, even by this gang of Liberals to my right, will not be forthcoming? In the past we have been provided with forecasts of the impact of programs. Is the new Conservative Government not even going to give us that information?


Svend Johannes Robinson: It is the same old bunch.


Martin Brian Mulroney: I believe I have responded quite adequately, Mr. Speaker, to the question.
November 26, 1984


HIBERNIA OILFIELD-ENVIRONMENTAL IMPACT STUDY
Mr. Brian Tobin (Humber-Port au Port-St. Barbe):: Mr. Speaker, my question is directed to the Prime Minister. Contrary to statements by both the Newfoundland Government and his own Minister of Energy, Mines and Resources, last Wednesday in this House the Prime Minister confirmed that the federal Government has received a copy of the environmental assessment impact study which was prepared by Mobil Oil on the Hibernia development. The Prime Minister promised to table the report in this House, Mr. Speaker.
Would the Prime Minister now confirm, while we are awaiting the document to be tabled, that Mobil Oil has determined, contrary to the wishes of the Government of Newfoundland, that the mode of production for Hibernia will be the use of semi-submersible rigs instead of the floating concrete platforms which had been proposed by the Government of Newfoundland and which could be constructed in that province?


Martin Brian Mulroney: Mr. Speaker, I cannot confirm or deny that specific statement. However, in response to a question from my hon. friend from Cape Breton, I have been communicating with him in regard to the information he sought in his question. The Minister of Energy, Mines and Resources was in Newfoundland last week putting in train the process of negotiating an offshore agreement to the benefit of Newfoundland and Labrador, something which escaped the capabilities of the Liberals for 15 years.


CONTENT OF REPORT
Brian Vincent Tobin: Mr. Speaker, will the Prime Minister tell this House why he was able to confirm last Wednesday that the federal Government had received such a report, and yet at the very same time in the Province of Newfoundland his Energy Minister was saying it would be withheld for six months because of an agreement with the Province of Newfoundland? What is being hidden in that report, Mr. Speaker?


Martin Brian Mulroney: Mr. Speaker, the question raised today is entirely different from the question raised last week. I believe my response to the question by my hon. friend from Cape Breton is one which has the overriding importance.


Joseph Jacques Jean Chrétien: You will table it?


PRESENCE IN GALLERY OF MR. IVOR RICHARD, COMMISSIONER OF THE EUROPEAN COMMUNITIES
Mr. Speaker:: May I interrupt the proceedings to indicate to the House that in our gallery today is Mr. Ivor Richard,
Oral Questions
Commissioner of the European Communities with Special Responsibility for Social Affairs.


Some Hon. Members:: Hear, hear!


INDUSTRIAL AND REGIONAL DEVELOPMENT PROGRAM
Steven W. Langdon: Mr. Speaker, my question is directed to the Prime Minister-


Brian Vincent Tobin: You are wasting your time.


Ramon John Hnatyshyn: You wasted all of our time.


Steven W. Langdon: The Government has damaged the Industrial and Regional Development Program by eliminating aid for restructuring business climate and tourist projects and by cutting half the help to Canadians for modernization and expansion projects, thereby creating great uncertainty for investors. Is the Government prepared to suspend these changes in order to permit the affected business enterprises, unions, and communities, to consult with the Government and plan fair and more effective changes in this program?


Martin Brian Mulroney: Mr. Speaker, I believe that the Minister of Regional Industrial Expansion is presently in British Columbia in the process of signing that kind of agreement, as we have been doing in a number of areas across the country. The object of the exercise is to restore a degree of stability to the political climate, to ensure that the private sector ceases to be clobbered to death by a Government which has been repudiated by the people. We are trying to work together with the provinces and the private sector to create a climate within which that new degree of prosperity can be brought about.


CONSULTATIVE PROCESS
Steven W. Langdon: Mr. Speaker, I wonder if the Prime Minister would agree that this IRDP case-and we are talking about the program in general, not about agreements with the provinces-is an example, to use his own words, of "deficiencies" in the Government's consultative process? Would the Prime Minister, therefore, commit himself to consult with businesses and communities before undertaking these changes which so badly hurt communities across the country?


Martin Brian Mulroney: Yes, Mr. Speaker, we are in the process of consulting with the provinces and with the private sector. Should the application of this policy bring about an injustice with which the Hon. Member is familiar, I will be happy to take it into consideration, because the object of the exercise is to provide a better climate for the

November 26, 1984
Oral Questions
attraction of investment capital and the creation of jobs for Canadians.


AGRICULTURE
Gordon Edward Taylor: Mr. Speaker, my question is directed to the Minister of Agriculture. Given that the last Liberal Government did nothing for eight months to stop the importation of highly subsidized beef from Ireland that filled the quota, to the detriment of our cattle industry and U.S. importation, what is the Government doing to make sure that such a catastrophe will never happen again?


Hon. John Wise (Minister of Agriculture):: Mr. Speaker, I am sure I can take some comfort and satisfaction in the fact that I am getting a question rather than a statement under Standing Order 21 from the Hon. Member.


John Edward Broadbent: Wait until tomorrow!


John Wise: I can assure the Hon. Member that shortly after assuming the job of Minister of Agriculture I held discussions with the people in that industry. We have had a series of interdepartmental meetings. We have concluded those meetings and I have a cabinet submission going forward. I hope to be in a position within a matter of days to announce a program and a policy which will indeed ensure that what has happened to the beef industry-which has cost that industry between $25 million and $50 million in 1984-will not happen in 1985.


Some Hon. Members:: Hear, hear!


ROYAL CANADIAN MOUNTED POLICE
John V. Nunziata: Mr. Speaker, my question is directed to the Solicitor General. It was reported last Thursday that the RCMP is involved in the investigation of a U.S. company suspected by U.S. authorities of shipping weapons technology to the People's Republic of China. This U.S. company is said to have links with Canadian companies. This information was revealed to Neil MacDonald of the Ottawa Citizen by the Solicitor General. In our view it was improper for him to comment on the RCMP investigation of this matter. Will the Minister indicate to the House whether it is the policy of his Government to reveal and comment on criminal investigations prior to charges being laid?


Hon. Elmer M. MacKay (Solicitor General of Canada):: Mr. Speaker, I believe it has been the tradition to confirm,
when asked, that an investigation was under way. That is all the information that was given.


VENTURE OILFIELD PROJECT
Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, my question is directed to the Right Hon. Prime Minister. I am sure he shares my optimism for the potential of the Venture Field off Nova Scotia. The problem is that the Government does not yet have its fiscal regime in place, yet the Minister of Energy, Mines and Resources said that Mobil Oil must move forward in the next few days on the Venture project. How can the Government expect the Venture partners to proceed when the fiscal regime is not yet in place?


Martin Brian Mulroney: Mr. Speaker, I think the Minister was conveying to Mobil that, indeed, the Government is highly enthusiastic about offshore development in Nova Scotia, as it is about development off the coast of Newfoundland. The Minister was conveying to Mobil and other interested partners our view that we would be very helpful in the development of the field, and assuring them that the fiscal regime as it is brought in will not place them at a disadvantage vis-a-vis anything that might have been available in the past.


NEGOTIATION OF OFFSHORE DEVELOPMENT AGREEMENT WITH PROVINCE OF NEWFOUNDLAND
Russell Gregoire MacLellan: Mr. Speaker, in June the Prime Minister announced that he had reached an accord on an offshore agreement with Nova Scotia, yet this accord now seems to have evaporated. Can the Prime Minister tell us why this accord is no longer in existence and why he and his Government are now saying that it may be at least six months before an offshore agreement can be reached with the Province of-excuse me-Newfoundland?


Martin Brian Mulroney: I am sorry, indeed it was with the Province of Newfoundland and Labrador where we felt that an extraordinary resource available for the benefit of the people of Newfoundland and Labrador could be developed for the interests of all of Canada. This development had been unnecessarily and unfairly stymied for 15 years, and we went about-


Brian Vincent Tobin: Answer the question, for God's sake. Cut the blarney.


Martin Brian Mulroney: -in a reasonable way and brought about a program designed to benefit Newfoundlanders in this regard. We are pressing on with good progress in searching for a definitive accord which I am sure will come very shortly, to the
November 26, 1984

satisfaction of all Members of the House with the possible exception of the Hon. Member from Corner Brook.


Some Hon. Members:: Hear, hear!


UNEMPLOYMENT INSURANCE
Nelson Andrew Riis: Mr. Speaker, my question is for the Minister of Employment and Immigration who will know the shock that employees for Tranquille Institution in Kamloops received recently when the provincial Government closed it down and sent lay-off notices to many of the employees that would extend well into January. She will know they also received a second shock when they found out that she had introduced a policy whereby severance pay and-


Mr. Speaker:: With great respect, does the Hon. Member have a question, please?


Nelson Andrew Riis: Is the Minister aware of her policy on reduced UIC benefits relating to earnings from severance and retirement benefits? Does she realize what this is going to do to the people who have already been so adversely affected?


Flora Isabel MacDonald: Mr. Speaker, the severance pay program announced means that those people receiving severance pay will have their unemployment insurance payments delayed until that severance pay has accomplished its purpose.


REQUEST THAT INTRODUCTION OF POLICY BE POSTPONED
Nelson Andrew Riis: Mr. Speaker, in a spirit of consultation, and because of the fact that it has been promised by the Prime Minister, the Minister of Finance, and the Minister of Employment, would she take it upon herself to extend the period whereby this policy will be introduced for, say, two months, to allow adequate consideration and consultation to take place, so that she will be well aware of the consequences for those affected by this very disastrous policy, before she continues?


Flora Isabel MacDonald: Mr. Speaker, that is certainly a very worthwhile recommendation by the Hon. Member and I will take it under consideration.


DEPARTMENT OF ENERGY, MINES AND RESOURCES PROPOSED RELOCATION OF OFFICE FROM SUMMERSIDE, P.E.I., TO CHARLOTTETOWN
George Roland Henderson: Mr. Speaker, my question is for the Minister of Energy, and in her absence I will
Oral Questions
direct it to the Right Hon. Prime Minister. Last week it was announced that the conservation and renewable energy office located in my riding in Summerside was being transferred to Charlottetown in the riding of the Minister of State for Tourism. This will result in 12 jobs being lost in an area where there are very few federal jobs. Did the Prime Minister consult with the Province of Prince Edward Island, with the Mayor and Town Council of Summerside, or with the Chamber of Commerce, before this decision was made? If not, why not?


Martin Brian Mulroney: Mr. Speaker, the Minister will be back tonight and will be happy to respond to the Hon. Member's question tomorrow, I am sure, and provide him with all the information. However, I understand that the implementation of that decision has been delayed pending her arrival.


RESEARCH
Maurice Brydon Foster: Mr. Speaker, my question is directed to the Minister of Environment. The cancellation of the $15.2 million Toxicology Centre at the University of Guelph and the University of Toronto will have a very adverse effect on the development of toxicology expertise in Canada. This was to be a centre of excellence. It will also have a very negative impact on industry and our competitive position in the products we sell abroad. It will also reduce our ability-


Mr. Speaker:: Does the Hon. Member have a question? I have been rising consistently on Members whose preambles get longer and longer. With great respect, does the Hon. Member have a question?


Maurice Brydon Foster: Mr. Speaker, I was just pointing out the adverse effects of this decision by the Government. Why has the Government cancelled this project which is so important to the health and safety of Canadians and which will have such an adverse impact on the sale of our products abroad?


Hon. Suzanne Blais-Grenier (Minister of the Environment):: Mr. Speaker, it is true that construction on the Toxicology Center at the University of Guelph has stopped. This was a joint project financed by the Province of Ontario and the Federal Government which was supposed to cost $32 million, but the latest estimates show that construction costs alone may reach $50 million.
I would remind my hon. friend that we are talking about construction costs, about construction of a building and facilities, and not about expanding the capacity for toxicological research. In fact, we shall continue to finance toxicological research, and the Federal Government is giving the Province of Ontario $3 million this year for research in that area, of which $700,000 will go to the University of Guelph.

November 26, 1984
Oral Questions


CONSULTATION QUERY
Maurice Brydon Foster: Mr. Speaker, the Government talks about increasing R and D budgets and talks about consultation. I ask the Minister if there was any consultation with the Province of Ontario before this announcement was made as a result of the slashing activities of the Minister of Finance? It seems to me that this is an important project which should have been continued, and I would be surprised if even the Tory Member from Guelph, who is a former president of the University of Guelph, was consulted on this action.
[ Translation]


Suzanne Blais-Grenier: Mr. Speaker, I would like to make a correction here. The plan to cut this expenditure was made within the Department of the Environment, recommended to Government authorities and approved by Cabinet. Furthermore, I am consulting with my Ontario counterpart, Mr. Brant, with whom I had a long meeting last Friday.


CANADIAN BROADCASTING CORPORATION
Mr. Howard McCurdy (Windsor-Walkerville):: Mr. Speaker, I will make this short. My question is for the Minister of Communications. Last week the Minister indicated that the reported savaging of CBC television in Windsor was just a matter of rumour. Is the Minister prepared to assure the House and the people of Windsor that the bureaucratic nabobs at CBC will not be allowed to emasculate the programming mandate of CBC in Windsor, or elsewhere in Canada, as a result of the $7 million cuts?


Hon. Marcel Masse (Minister of Communications):: Mr. Speaker, in respect of everything concerning this question, as long as the Canadian Broadcasting Corporation, through its president, Mr. Juneau, does not tell me its plans concerning the implementation of budget cuts, and as long as I have not heard from them, those are only rumours as far as I am concerned, in the sense that anything suggested, predicted and written within and without the CBC is a rumour until such time as I have received official confirmation.


REQUEST FOR CONSULTATIONS
Howard Douglas McCurdy: Mr. Speaker, there has been a good deal of discussion today about the promise of the new Government to consult with the Canadian
people. Is the Government prepared to guarantee that there will be no decisions made with respect to the cuts at CBC in Windsor, or elsewhere, until a two month period has elapsed for consultation with the people in the communities involved?


Marcel Masse: Mr. Speaker, I can assure the Hon. Member that no cuts will be made until the president of the Canadian Broadcasting Corporation sends me his document.


SOCIAL SECURITY
Mr. Al Girard (Restigouche):: Mr. Speaker, I wish to direct a question to the Acting Minister of Health.
First, I should like to commend the Minister of National Health and Welfare for his decision to come to the assistance of widowers and widows aged 60 to 64 inclusive who are in need. However, I would like to know what the Minister intends to do to help people who live alone, are aged 55 and have no income.


Hon. Otto Jelinek (Acting Minister of National Health and Welfare):: Mr. Speaker, the Minister of Health will be back in the House tomorrow. I will take that question as notice and I am sure he will be happy to respond directly to the Member.


ADMINISTRATION OF JUSTICE
Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, my question is for the Minister of Justice. Following a two-day meeting with Justice Ministers from across Canada, the Minister stated that he was prepared to make accessible information from federal data banks so that defaulters of payments of maintenance orders could be traced more easily. The Minister stated that 80 per cent of all men can afford to pay but 50 to 75 per cent of them default, and provincial police cannot find them.
Will the Minister give Canadians his assurance that the promised new Divorce Act will include an effective national system of enforcement of maintenance and custody orders, thereby assuring a mechanism whereby such awards will be respected, and assuring that women and children are not forced to become wards of the state?


Hon. John C. Crosbie (Minister of Justice and Attorney General of Canada):: Mr. Speaker, the short answer is yes, and I hope you approve of that.
November 26, 1984


APPLICATION OF LAW
Sheila Finestone: Mr. Speaker, as divorce falls under federal jurisdiction, maintenance and custody orders emanating from divorce decrees should be included in the Act and should apply equally across Canada. Will the Minister assure us that the law will be the same for all women, and will be applied equally across Canada in order that we can expect justice and equity in this matter?


John Carnell Crosbie: Mr. Speaker, the law will not only apply to all women, it will apply to all spouses. I do not discriminate against men either.


NATIONAL DEFENCE
Derek Nigel Ernest Blackburn: Mr. Speaker, in the absence of the Minister of National Defence I would like to address my question to the Right Hon. Prime Minister. At a time when the Department of National Defence is suffering a $154 million cut-back as announced a couple of weeks ago, why is the Prime Minister allowing the Vice Admiral's yacht, known as the Admiral's Barge, to be outfitted with an additional $50,000 worth of equipment, including shag carpeting and such tactical things as ice-making machines?


Leslie Gordon Benjamin: It is a perfectly legitimate question.


Mr. Speaker:: It is a perfectly legitimate question. It might be a legitimate question for the Minister of National Defence, if he were here. My problem is that in his absence that is probably an Order Paper question. I will let that question stand if the Prime Minister chooses to answer it. I just want to make that point for other days on these types of technical questions. I will let it stand. The Prime Minister may choose to answer.


Derek Nigel Ernest Blackburn: Mr. Speaker, may I then put it to the Prime Minister another way. Why is the Admiral's Barge, or this 40 foot craft, being sent to the Caribbean when it has never been sent there before? It happens to be going in January and February of 1985.


Some Hon. Members:: Oh, oh!


John Edward Broadbent: For your Christmas holidays.


Martin Brian Mulroney: It was either the Caribbean or Baie Comeau-


Some Hon. Members:: Oh, oh!


Martin Brian Mulroney: -and because we believe in freedom of information we let them make the choice. We do not want to put muzzles on civil servants or military.
Oral Questions
I am sorry, but in the absence of the Minister of National Defence I cannot provide the detailed response to which my hon. friend is entitled. However, since the Minister will be away for a number of days I will look into it and provide the detailed answer as quickly as I can.
I should say that the prefatory observation is inaccurate. The commitment of the Government is to enhance the conventional military capacity of Canada and to treat service men and women with the kind of respect that they deserve.


FINANCE
Dave Nickerson: Mr. Speaker, in the absence of the Minister of Finance I will address my question to the Minister of State for Finance. Will the three cent a litre fuel tax rebate promised to farmers, fishermen, loggers, and miners, in the recent economic statement, also apply to trappers?


Barbara Jean McDougall: Mr. Speaker, I do not understand why the questions always come from behind me. I know that trappers were not specifically mentioned. I would welcome taking the Hon. Member's question as notice and I will let him know.


NATIONAL CAPITAL
Mr. Gaston Isabelle (Hull-Aylmer):: Mr. Speaker, my question is directed to the Right Hon. the Prime Minister. Considering that, since 1967, all the Prime Ministers of Canada were involved in the development of Canada's national capital, here is my question: since all the Prime Ministers have been involved, does he intend to appoint a joint committee of the House of Commons and the Senate to consider the future of the National Capital Commission, in light of the fact that the weekend newspapers reported that many people have expressed the desire to become chairman? Now that the Greber plan has been completed and implemented, I should like to ask him whether he intends to set up that special joint committee to consider the future of the National Capital Commission?


Martin Brian Mulroney: Mr. Speaker, we do intend to proceed without undue delay with some appointments within the National Capital Commission and to depoliticize it. The commissioners will undoubtedly want to meet with Hon. Members of all political stripes with a view to discussing that issue.

November 26, 1984
Introduction of Bills


CANADIAN WHEAT BOARD
Mr. Vic Althouse (Humboldt-l ake Centre):: Mr. Speaker, my question is for the Minister of Agriculture. As he knows, over half of the crop in the Peace River country in northern Alberta and British Columbia is under the snow. In these cases the Cabinet usually authorizes the Wheat Board to grant cash advances. Can the Minister explain to the House why this authorization has not been forthcoming to this point as is usual?


John Wise: Mr. Speaker, I appreciate the Hon. Member's concern on this. As the matter falls more directly under the responsibility of my colleague, the Minister responsible for the Canadian Wheat Board, who is presently meeting farmers in the Province of Manitoba, I will draw this matter to his attention. I am certain that upon his return he will respond to the Hon. Member.


CLERK OF PETITION'S REPORT
Mr. Speaker:: I have the honour to inform the House that the petition presented by the Hon. Member for Hastings-Frontenac-Lennox and Addington (Mr. Vankoughnet) on Friday, November 24, 1984, meets the requirements of the Standing Orders as to form.



ROUTINE PROCEEDINGS


Gordon Edward Taylor: for leave to introduce Bill C-211, an Act to protect heritage railway stations.


Mr. Speaker:: Shall the Hon. Member have leave to introduce the said Bill?


Some Hon. Members:: Agreed.


Gordon Edward Taylor: Mr. Speaker, I have great pleasure in moving first reading of this Bill, an Act to protect heritage railway
stations. This Bill was introduced in the dying days of the last Parliament by the former Member for Parkdale-High Park, Mr. Flis, who no longer is a member of the House.
The Bill provides efficient mechanisms to permit our citizens to make timely objections to the alteration, removal or demolition of railway stations of historical and cultural significance and value and to ensure their conservation in the public interest.


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

Barbara Jean McDougall: for leave to introduce Bill C-12, an Act to amend the Excise Tax Act and the Excise Act.


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

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Paul Dick (Parliamentary Secretary to Minister of State (Government House Leader)):: Mr. Speaker, the following question will be answered today: No. 28.


DEPARTMENT OF PUBLIC WORKS LAWYERS
Mr. Howie: How many lawyers are employed by the Department of Public Works?


Hon. Roch La Salle (Minister of Public Works):: There are three lawyers assigned to Public Works Canada from the Department of Justice.


Paul Wyatt Dick: I ask, Mr. Speaker, that the remaining questions be allowed to stand.


Mr. Speaker:: The question enumerated by the Hon. Parliamentary Secretary has been answered. Shall the remaining questions stand?


Some Hon. Members:: Agreed.
November 26, 1984



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mrs. McDougall that Bill C-7, an Act to amend the Income Tax Act and related statutes, be read the second time and referred to the Committee of the Whole.
Steven W. Langdon: Mr. Speaker, we are continuing to debate the principles associated with Bill C-7. In our opinion, it is a question that concerns the degree of priority the Government has given to what is essentially a housekeeping Bill as opposed to some more fundamental initiatives that would do something about the unfairness of the tax system.
We are particularly concerned about the way in which the Government, in an effort to draw more tax revenue, has focused on individual taxpayers through the establishment of a new set of inspectors to deal with them as opposed to focusing on the corporate sector.
Before we rose at one o'clock I was dealing with the question of transfer of payments by large corporations, both Canadian and foreign, and the way that permits tax avoidance to take place. That costs us money.
In the past we have heard comments from officials in the Ministry of National Revenue that indicate very clearly that they do not have enough inspectors to be able effectively to police the large number of transactions that take place across borders by Canadian and foreign corporations dealing with their own subsidiaries. There are classic cases, such as Canadian companies with subsidiaries in the Bahamas, or Bermuda, which on paper will sell items to that subsidiary and then buy them through other subsidiaries, with the material never actually moving back and forth from one country to another. In each case, the effort is to avoid tax responsibilities and tax levies here in Canada.
Instead of concentrating on these important examples of tax avoidance where literally millions of dollars are lost to the Canadian authorities, the tax department in this country has focused on small Canadians. My colleague, the Hon. Member for Kamloops-Shuswap (Mr. Riis), has talked about a number of these cases in the context of British Columbia. With respect to my constituency of Essex-Windsor, we have discovered that many low-paid waitresses have been the focus of detailed investigations by the tax authorities of this country. We have seen dozens of women who often work part-time for very low wages being harassed by the tax authorities because of suspicion on their part that these women have not been declaring the tips which they received as waitresses.
In fact, as a result of detailed investigations by the Hon. Member for Windsor-Walkerville (Mr. McCurdy) and myself, we have discovered that people affected in this case are being attacked by Revenue Canada even though in many cases these
Income Tax Act
women have kept careful records of the tips they have received. Their strong feelings have been conveyed to those tax authorities that this was deliberate harassment rather than any kind of fair attempt to get a sense of what was really going on in their personal finances.
We suggest that the Government, rather than giving priority to tidying up tax matters left by the last regime and making a systematic attempt to harass yet more individual Canadians through new tax inspectors, should be making an effort to tackle the tax avoidance problem associated with transfer pricing and attempting to establish more fairness in the tax system by improving the corporate and personal tax system.
It is fairness in the personal tax system which is perhaps the largest problem about which we have heard from our constituents throughout the country. Our Party believes that the tax system should be a good deal more progressive. While the tax system looks progressive on paper at the moment, when one actually examines the effective marginal rate of taxation as analysed this past year by the National Anti-Poverty Organization in a detailed report, one finds that the effective marginal tax rate for those making over $50,000 a year is only 29 per cent. The rate for those earning between $40,000 and $50,000 a year is only 29 per cent. Even for those earning $35,000 per year the effective rate is only 28 per cent once you take into account income which is exempted from tax through various exemptions. That is not a very steep increase in the tax system reflecting the principle to which I think most Canadians hold. If you earn more you should pay a higher share of the dollars you are receiving to the personal income tax system.
We are also concerned within the income tax system about the way we continue as a country to rely on deductions rather than tax credits. As we know, a tax deduction for a registered retirement savings plan of $5,000 is worth very much less to somebody who is making, let us say, $25,000 a year than it is to somebody who is making $50,000 a year. Even though the progressive nature of the tax system is not great, nevertheless the marginal rate of tax is higher on that $5,000 for the person who is earning $50,000 a year.
We urge the Government to move to reform our system by shifting from a system based on deductions to a system based on tax credits, following the principle of the child tax credit scheme which is one of the few examples in the tax system of a tax credit rather than a deduction approach. We also suggest that the system of tax expenditure needs to be brought back into our budget. A number of my colleagues have already made this point. We consider it serious and important that we have as taxpayers a continuing record in which various tax exemptions and tax advantages are being shared across the income classes and throughout the country.
Finally with respect to the income tax system, I urge the Government as it conducts a more comprehensive analysis of changes that need to be made to take a careful look at the tax credit for children. At present this tax credit has given us a lump sum. The result is that many poor women go to tax

November 26, 1984
Income Tax Act
agencies of various kinds and receive their tax credit prior to receiving it from the income tax department. They have to pay from 10 per cent to 15 per cent of the tax credit to the tax agency.
I suggest we establish a system which sees to it that that tax credit is paid in monthly sums to families affected so that people receive the money not in a lump sum but automatically, in the same way as family allowances or old age pensions are received. It seems to me this would make it easier for families who need the child tax credit; they would then receive it in a more effective way and it would make more of a contribution toward alleviating poverty.
We as a Party have been arguing on tax issues for many years. We have had reference to the Carter Commission by a number of speakers. We feel, and it is one of the reasons we are prolonging this debate today, that it is very important to have a full-scale, comprehensive and effective review of our tax system. Our leader, the Hon. Member for Oshawa (Mr. Broadbent), suggested in the election campaign that we should set up a royal commission on taxation. This could take in the whole set of issues we have been talking about today. A royal commission could bring some of the best minds in our country to look at our tax system and see if we could not make it a much fairer instrument for economic growth and equity. Many people in this House have been speaking about this since the start of our parliamentary session.
We have today what is, in effect, a housekeeping measure from the past regime. We hope in the future that we will see serious efforts at tax reform in the areas I have been talking about. We hope the Government will be prepared to take up our suggestion of a royal commission on taxation to try to establish a sense of fairness, a sense of efficiency and a sense of contributing to economic growth which all Canadians hope to see in the tax system.


Mr. Deputy Speaker:: Are there any questions or comments? If not, we will resume debate.


Howard Douglas McCurdy: Mr. Speaker, it was not my intention originally to debate this Bill but I think I must make some comments on suggestions made earlier today by the Hon. Member for Western Arctic (Mr. Nickerson). He proposed that there be no tax on capital gains. I thought that was a rather interesting proposition when one considers it in the context of the over-all philosophy of income tax in general. It seems to be inherent in the whole structure that if one owns land and makes money on it, if one makes an investment and makes money on it, or if one has dividend earnings, this is in some way superior in the kind of treatment it deserves compared to income earned by dint of hard work.
I do not think I have ever heard it suggested that there be a depreciation allowance for the physical damage that results from a lifetime of hard work. It seems to me, from the point of view of the Canadian worker, that there should be some focusing on this aspect of our taxation system. Why do we have a taxation system that is so determinately punitive to the poor and to those who must make their earnings by physical
labour? What is the philosophical premise on the basis of which those who invest in fine art or property may keep much more of what they earn compared to those who work in the mines, in the factories, in the restaurants and so on?
My colleague the Hon. Member for Essex-Windsor (Mr. Langdon) has referred to the situation in Windsor where waitresses have been harassed because it is assumed that some trivial amounts of money are not being reported for income tax purposes, irrespective of the fact that upon request to do so they have supplied all the information on the basis of which they can be properly taxed.
I note this strange dichotomy also permits Revenue Canada to harass those who plead their cases to those who would want to be their elected representatives. There is clear evidence that those who have reported their circumstances, recorded this pattern of harassment, have been harassed yet more. I hope in the future, the not too distant future, that this Government will begin to right the disproportionate imposition on the poor of the taxation burden.
There have been repeated references to the Conservative progressivity of the tax system and to the need for a minimum income tax. There have been references to the lightening of the burden of large corporations and to the special treatment accorded to doctors, lawyers, dentists and so on. I do not think we need a further recital of those facts to make it clear beyond any reasonable doubt that there is a need for considerable reform, reform which will be fair not only with respect to particular types of tax incentives, deductions and so on, but in addressing the fundamental issue to which I referred earlier, that is the fundamental difference in treatment or the way in which we regard those who make their money by physical labour compared with those who make money simply because they have money.


Mr. Deputy Speaker:: Is the House ready for the question?


Some Hon. Members:: Question.


Mr. Deputy Speaker:: Mrs. McDougall, seconded by Mr. Hnatyshyn, moves that Bill C-7, an Act to amend the Income Tax Act and related statutes, be read the second time and referred to the Committee of the Whole. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.
Motion agreed to and Bill read the second time.


Mr. Deputy Speaker:: Accordingly, the said Bill stands referred to Committee of the Whole.
November 26, 1984


CUSTOMS ACT CUSTOMS TARIFF
Barbara Jean McDougall: that Bill C-9, an Act to amend the Customs Act and the Customs Tariff, be read the second time and referred to the Committee of the Whole.
She said: Mr. Speaker, I am pleased to put Bill C-9 before the House today. It would enact the amendments to the Customs Act and the Customs Tariff set out in the notice of Ways ands Means motion tabled on November 8. Our Government is proceeding with this legislation early because of its vital importance to Canada's trade performance.
All Hon. Members of the House know that there is a general movement toward freer trade world-wide. This Bill enhances Canada's commitment to the General Agreement on Tariffs and Trade. These measures were originally brought before the House by the previous government on February 15, 1984. Bill C-9 is particularly important because it will enhance Canada's participation in the multilateral trading system by implementing a new method of valuing goods for customs purposes in line with our GATT obligations.
The Bill also introduces certain amendments to the Customs Tariff related to the implementation of this new valuation system. It expands the duty-free product coverage of the Customs Tariff in line with the expanded coverage under the GATT aircraft agreement. It removes the condition for certain tariff items that goods must be of a class or kind made or not made in Canada in order to qualify for specified rates, as well as providing for a number of miscellaneous tariff changes.
With respect to amendments to the Customs Act found in Part I of the Bill, it might be helpful if I described the context within which Canada decided to change its valuation system as of January 1, 1985. For many years there has been a growing recognition among the world's major trading nations that the openness of the international trading system could be strengthened by moving to more standard and transparent procedures which affect the flow of trade.
Since Canada relies to a great extent on international trade for our economic well-being, it is crucial that we support and participate in these multilateral efforts to harmonize international trade procedures.
One of the major initiatives of the Tokyo Round of multilateral trade negotiations concluded in 1979 was the establishment of a customs valuation code, under which all major trading nations of the world would establish the value of imported goods for the purpose of assessing customs duty in the same manner. By knowing the rules of the game in advance, exporters and importers alike would have greater certainty in conducting their business transactions in international as well as in domestic markets. Under the customs valuation code and in the proposed legislation now before the House, the price paid by the importer to the exporter for the imported goods will be the value on which duty is applied unless certain clearly defined conditions exist.
Customs Act
Those of us who are familiar with the current Canadian system realize that this approach is quite different from the one currently applied wherein the value for duty is, as a general rule, the price at which like goods are sold in the exporter's domestic market.
In spite of the advantages foreseen in adopting this code and the fact that Canada was able to obtain greater access to more markets as a result, this decision was not made without costs.
Many of our trading partners had customs valuation systems which closely approximated the provisions of the code. Their adherence to the code required only minor adjustments on the part of their business communities and customs officials. Canada's system of customs evaluation, on the other hand, was unique and our implementation of the code required a substantially greater reorientation of customs procedures.
In addition, analyses indicated that the base upon which some goods would be valued for duty would be lowered and the level of protection afforded to Canadian manufacturers by the tariff would be diminished. Thus, during the Tokyo Round Canada attached two conditions to the adoption of the customs valuation code. The first was a four-year extension to the deadline for implementing the new valuation system. While our GATT trading partners agreed to bring their systems into line with the code by January 1, 1981, Canada's obligation to implement the code will be January 1, 1985.
The second was our right to increase tariff rates, wherever necessary, to maintain the same level of production. Against this background it was extremely important for the Canadian business community to have the fullest opportunity to comment upon the legislation implementing the code and upon the effect its implementation would have on their tariff protection. Through the Tariff Board individuals were encouraged to make their views known and public hearings were held. The vast majority of recomendations made by the Tariff Board following these hearings were accepted for implementation. In summary, these amendments to the Customs Act will provide over the longer term more certainty and clarity for importers.
Since these provisions are also reflected in the statutes of our trading partners, we can be sure that a similar certainty is available to our exporters. Indeed, this type of transparency and openness can help to strengthen the multilateral trading system and increase world trade to the benefit of all.
Three aspects of the proposed Customs Tariff amendments contained in Part II of the Bill are related to the new valuation system. They are intended to maintain protection which could have been lost by Canadian producers resulting from the implementation of the new valuation system. I must emphasize that we are not proposing-and it is important to mention that we cannot propose-under our international obligations increased or new protection for these individual items.
First, tariff rate increases are contained in Schedule I of the Bill of individual items where the termination of the current system would lower the value of the goods on which duty is collected. These rate increases have been recommended by the Tariff Board following a series of public hearings. However,

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certain adjustments were made to the Board's proposals to reflect the scheduled Tokyo Round multilateral trade negotiations reductions and to reflect certain concerns of the business community and our trading partners.
Second, the customs valuation code does not allow the use of the current ministerial prescriptions whereby the Minister of National Revenue (Mr. Beatty) can establish values for duty for certain classes of goods in cases where values cannot otherwise be determined under the law. To replace some of these ministerial prescriptions, the Bill would implement an advance of 25 per cent of the existing tariff rate for used and less than prime quality goods. This was also a proposal of the Tariff Board developed after discussion with interested sectors of the Canadian business community.
In order to ensure that this advance is applied only where necessary, the legislation would allow the Governor in Council to make regulations to define these goods, to exclude certain goods from the application of the advance and to allow for suspension of the application where appropriate. Finally, as a new measure, importers will be able to avail themselves of the appeal procedures contained in the Customs Act when used and less than prime quality goods and the tariff rate advance are in question.
I might add that consultations with our trading partners have also been completed. They accept these measures as being compatible with our international rights and obligations.
Effective January 1, 1985, Part II of this Bill will also implement the expanded duty-free product coverage of the GATT Agreement on trade in civil aircraft. Since Canada already extended duty-free entry to most of the 32 new-product categories now covered by the agreement, only minor inclusions need to be made to our duty-free provision. However, export opportunities to markets of the signatory nations including the United States, European communities and Japan will be improved as a result of their removing tariffs on these 32 categories of products.
As a result of Tariff Board recommendations, this Bill also removes a condition established for 19 tariff items that imported items must be of a class or kind made or not made in Canada in order to be allowed entry at specified tariff rates. The changes being proposed represent only some items contained in the board's proposals. The remaining items are being held for consideration at a later date.
Effective February 16, 1984, the Bill also introduces a number of miscellaneous tariff changes. One change is an increase in the limit for duty and tax-free entry of unsolicited gifts from $25 to $40. This will be welcomed by Canadians who receive gifts from friends and relatives abroad and is also consistent with the limits established by other countries.
Duty-free entry is also being extended for a wide range of capital equipment used by semi-conductor manufacturers. These companies now export over 90 per cent of their production, and this measure will assist them in lowering their costs and help them in export markets. A number of other minor
changes are included in the Bill which respond to requests from the private sector or which resolve certain technical administrative problems for customs officials.
In conclusion, let me emphasize that the measures proposed in this Bill are very significant because they will enhance Canada's contribution to the multilateral trading system by bringing Canada's customs valuation procedures into line with those of our trading partners. They are also significant because they are of benefit to many sectors of the Canadian business community. I hope that the House will agree that they are worthy of speedy passage, bearing in mind Canada's international commitment to implement the GATT valuation code by January 1, 1985.


Aideen Nicholson: Mr. Speaker, we had a most interesting morning as we heard Members of the government side discover new virtues in the measures introduced this morning, measures which in most cases were identical to those introduced in the last Parliament through the Lalonde budget. It is interesting how measures which would ruin the country in February have now become, under a new Conservative Government, measures well worthy of support.
We find ourselves in the same situation with the current legislation. This legislation seems to be virtually identical to measures introduced in the February 15 Budget. The present measures to amend the Customs Act and Customs Tariff have been combined, but I cannot see any essential difference between the two. There are some small differences in drafting, one or two differences in timing, and the lack of seven further tariff rate increases which were proposed in 1984. Otherwise, the measures seem to be identical to those of February, 1984.
I shall now wait with great interest to hear Members on the government side tell us what good measures these are, whereas last February they were telling us how disastrous they were.


Nelson Andrew Riis: Bill C-9 provides that goods being imported into Canada will be valued according to their transaction value or the value of the goods as paid by the importer. At present, the value of a good being imported is assessed at the fair market value of the good in the country of export. Perhaps I can use an example. If a Canadian importer were to import Sony television sets from Japan, under the present system, the Sony television sets would arrive in Canada and would be assessed a customs duty based upon what Canadian officials would determine to be their fair market value in Japan. Under this new provision, we have a system in place under which the Sony television sets would arrive in Canada and would be assessed by customs officials a duty based upon the value the Canadian importer paid for those television sets. That simply brings us into line with the system used by most of our trading partners and certainly by all of our major trading partners.
I believe it is important to recognize that the present system under which we have been operating and which is in place at the moment carries with it the potential for erecting a form of non-tariff barrier. If the Government wanted to slow down the flow of a particular good into Canada, it might lower its estimation of the fair market value of the good being imported. Then the good would be coming into Canada at a price lower than it sold for in the country of export. That would then allow Canada to lay a charge of dumping and the Government could proceed with anti-dumping actions. Essentially, Mr. Speaker, that erection of a not-so-subtle tariff wall could happen if that were the kind of action we wanted to take.
The new system that we are debating presently and that is currently being followed by our major trading partners would remove the potential of setting up a non-tariff barrier. The valuation of imported goods being in accordance with their transaction value will eliminate this arbitrary nature and establish a fair and therefore more neutral system. I think anyone who has either worked in the area of import-export or is familiar with the customs process would recognize the advantage of this particular change. For that reason, we shall certainly see that the Bill receives rapid passage.
I would like, however, to use this opportunity to mention two or three other things. When dealing with the nitty-gritty of Bill C-9 and looking at the various changes to the tariffs, we see that it poses all sorts of questions. I do not think that second reading is the time to raise those questions. For example, to make the case, toilet bowls imported into Canada that are made of a certain china mix would be charged a general perferential tariff of 9 per cent. However, urinals that are being imported into the country would come in free under the same tariff. These are some of the interesting questions which could be addressed during the clause-by-clause discussion, to identify why toilet bowls are treated differently from urinals.
I would like to take a moment during second reading debate on this extremely important Bill to reflect on the discussion which has occurred across the country in recent weeks, with some enthusiasm, concerning the whole matter of free trade. It
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involves either sectoral free trade, as has been witnessed over the past number of months with respect to the farm implements, computer information and the like, or general free trade. I have not been enthused or encouraged by the love-in which has occurred between the new Prime Minister (Mr. Mulroney) and the President of the United States in terms of their coming together as friends and the indication of what it might mean for Canada in terms of developing a sound national economy. Neither have I been encouraged by the comments made in recent weeks by the Government with respect to FIRA. I have never sorted out in my own mind what the fear of FIRA was all about, recognizing that almost every country of which I am familiar has some form of FIRA process in place. Many of those processes are much more involved and complicated than our present and past FIRA regulations. I have never been convinced that legitimate investors and legitimate businesses have been hindered in entering into the Canadian economy as a result of FIRA. If they are not prepared to lay out clearly how their activities will be of benefit to our country, I am not certain that we should be so enthusiastic about welcoming them to Canada.
Canada today has some real problems associated with the branch plant economy. The fact that Canada has had tariff walls to a certain extent has resulted in certain firms being forced to open branch plants in Canada in order to have access to the domestic Canadian market. That has created both advantages and disadvantages. The advantage is that there is a plant in place, jobs are being created and there is a value added to the general economy. If the tariff walls were removed and there were to be free trade between Canada and the United States-and if there were a North American common market, which President Reagan speaks of and for which many Ministers opposite have indicated enthusiasm-then the branch plants would have no reason to be in Canada. We would find many of them simply moving back to their head offices. Consequently, a free trade situation might result in a significant reduction in economic activity and job creation in Canada.
On the other hand, we must recognize the downside of the branch plant economy. It has resulted in a situation where, for many, there has been little if any incentive to expand their operations and to seek new market opportunities elsewhere. If their total rationale for existing in Canada is simply to serve the Canadian market, why would they expand overseas? Why would they open up research and development facilities if all they really are is a branch plant of an American or other foreign parent company?
It is a Catch-22 situation. But we should not simply fall all over ourselves in enthusiasm over free trade, particularly when in the United States virtually every single action before Congress today that touches on the American economy is one of protectionism. The Americans are implementing stronger procurement policies. "Buy American" has never before been so strong. All sorts of subtle tariff walls are being thrown up in terms of imports. When that process is going on in the United States Congress, and there are approximately 27 Bills which

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Congress is to examine that will essentially place a protective wall around a certain sector of the American economy, for us to be leaping for glee at the concept of free trade somehow makes me very nervous. For that reason, we should move very cautiously.
Recognizing how important trade is and how important it is to develop a strong manufacturing sector within the Canadian economy, we should look for a moment at one of our major trading partners other than the United States, and that is Japan. In 1983, we exported coal, lumber, rape-seed, wood pulp, wheat, meat and other commodities to Japan. We imported automobiles, telecommunications equipment, photographic goods, televisions, radios, phonographs and similar types of good from Japan. I think that serves as an example of one of the fundamental problems which we face as an exporting country. The goods which Canada exports encourage the development of our traditional resource sector at the expense of the development of a strong manufacturing sector. That manufacturing sector is labour-intensive. It will create jobs, and a stable long-term economy will be developed.
In short, as we move into discussions of free trade, particularly with the United States, it must be done in a much more open fashion. Those discussions must allow all major players to have an opportunity to express their views, whether they be small manufacturers, large national corporations, labour groups or others involved at various levels of government. We must provide an opportunity for them to ensure that whatever decision is made, either on a general basis or on a sectoral basis, is made in the best interests of Canada.
I would like to return briefly to Bill C-9 which I am pleased the Minister has introduced. It is a step in the right direction in that it allows us to examine the whole business of what goods should be kept out of the country as a result of tariffs and what goods should be attracted to the country. Particularly, I want to bring to her attention the differentiation in tariff rates. Of course, the Minister is well aware that there are different rates. The Bill cites the British preferential tariff, the most favoured nation tariff, the general tariff and the general preferential tariff. As Canada takes on its rightful role as a major trading nation, that being to assist developing countries which have commodities that Canada wishes to use, I think it is important for us to recognize that in some areas our existing trade categories may not reflect the concern which we have for many developing countries. Perhaps the time is not far off when we will have to look at the manner in which we categorize our trading preferences. By looking at that area we might be able to take steps which would enhance our trading relations with certain developing countries.
We look forward as a Party, Mr. Speaker, to examining the clause-by-clause element of Bill C-9. I would like to indicate to the Minister that she can be assured of our speedy support to have it in place.


Gordon Edward Taylor: Mr. Speaker, I would like to just say a few words in connection with the Bill. There are
really two cases to which I want to refer. The first case happened in Calgary where a dentist ordered supplies from the United States. The dentist lives about 35 miles or 40 miles outside of Calgary and the day these goods came in he was very busy and unable to go into Calgary to pick them up. He wanted to send someone else, so he phoned the customs office and asked what the cost was so he could send along the money. They would not tell him the cost and told him he would have to come in himself. I feel it is pretty ridiculous that the dentist could not send a messenger to pick up a parcel which was sent from the United States in his name. There was nothing illegal about those goods. The customs people refused to tell him the amount so he could send a cheque.
I would like to urge the Hon. Minister to look at the way in which some of these customs officials have been acting in the performance of their duties. There is no call for this type of procedure at all.
The other point I want to mention briefly is that for a long time there seemed to be a practice of not putting any duty on equipment which was going to be used to produce food, in other words, farm equipment. Within the last few years this practice has been gradually changing. Last year a move was made to put custom duties on this equipment, and the farmer had to wait for as long as six months in order to get his money back. When one is buying heavy equipment which costs $18,000, $25,000 or $50,000, one does not have the resources to wait for six months for a refund.
I would like to urge the Minister to consider that equipment that is coming into this country for the production of food should come in duty free. There should not be a customs tax on this type of equipment because otherwise it simply means that we increase the cost of food to the consumer and put the farmer in that much more of a difficult position. If this tax is going to be refunded later, why go through all the rigmarole of collecting the money from the farmer, have him apply to get it back, and then make him wait six months for a refund? It is just a rigmarole which should not be tolerated. I would urge that there be no customs duty on agricultural equipment, because we want to keep the cost of food as low as possible. The layer after layer of costs we pile onto the shoulders of the farmer will eventually have to be paid by the consumer. I believe there is a sound argument for saying that any equipment which comes into Canada for the production of food should come in duty free.


Stanley J. Hovdebo: Mr. Speaker, I suppose that what I want to do in my remarks, really is to agree with the Hon. Member who just spoke, to some extent. The concern of our Canadian West about tariffs is not a new phenomenon at all. For a long time the western farmer has been faced with having to buy everything on the protected market and sell everything on the free market. Consequently, there is a section of Canada, and, unfortunately, it is the western part of Canada, which is much more affected by tariffs and customs than are other parts of Canada. Therefore, the West has generally objected to the level and the structures of both tariff and non-tariff barriers for two basic reasons;
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first, as pointed out by the previous speaker, tariff barriers or non-tariff barriers do increase the price of goods to the consumer. Therefore, the consumer pays a great deal more, particularly for production costs, than he would otherwise have to pay. Second, quite often the West has trouble selling goods on the foreign market because of import barriers. Our trading partners are much slower to deal with us when they know that we have high tariffs for goods which they want to sell.
It is very difficult, Mr. Speaker, to measure the actual costs or the benefits of Canada's protectionist policies. So much depends on the consumption patterns and on the degree to which domestic producers use the products. However, if one recognizes that the consumers' price is higher as a result of tariffs and that this tariff cost is distributed across the country according to the distribution of the consumers, then by dividing the costs by the number of consumers, one can actually come up with a cost per individual. Using this method one finds that each man, woman and child in Canada paid an extra $132.62 in 1983 as a result of import tariffs.
It becomes, therefore, important that we take a look at what industries in the country and what parts of the country are affected by these import tariffs. In western Canada the tariff cost to consumers was close to $1 billion in 1983. Yet it ended up affecting only 271,000 jobs in the manufacturing market. If one compares this to the eastern part of the country, to Quebec and Ontario, there is a much more positive effect. In fact, if we look at the tariffs in Canada and compare the East with the West, we find that the effect of tariffs on the West is negative. It costs us money all the time. We do not get enough effect from the barriers to be of any value to us in the West. In the East, in Ontario and Quebec, the tariffs are positive. In other words, removing them would be harmful, but removing them in the West would do us good. That is something that we must recognize and balance out in some way so that no part of the country is hurt. The Hon. Member who spoke previously indicated that one way of doing this would be to pick certain specific products or certain areas of the country and make sure that they would be less affected than they are under present circumstances.
I think it is important, Mr. Speaker, when looking at a Bill like this, that we consider the total tariff structure and its effect on the entire country rather than on specific areas or specific industries.


Mr. Deputy Speaker:: Are there questions and comments on the Hon. Member's speech? If not, we shall resume debate.


Don Boudria: Mr. Speaker, it gives me great pleasure to have the opportunity to participate in this debate, and I will do so very briefly. I wanted to raise a few concerns I have about the shoe industry which is very important in my constituency. It employs several hundred people, principally around the Alexandria area which has one plant manufacturing all of the Adidas tennis shoes in this country as well as several other makes.
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The previous government had extended the quotas on shoes until March 31, 1986, I believe. Beyond that, we still do not know what the plans are for that particular industry. We know that the industry is extremely concerned and has serious worries as to the future. It would like to know if the Government has yet formulated any plans and, if so, would it be willing to share them with this House at this time? I think we should remember that it is very difficult for our country to compete with some of the other shoe manufacturing countries, especially when you consider that almost 50 per cent of the shoes manufactured in the world are done so in the underdeveloped or so-called developing countries. Their labour is much cheaper than ours. We must recognize the fact that many people who work in our shoe industry here in Canada are indeed very low paid workers. Shoe imports in Canada in 1966 were only of the order of 10 per cent. By 1970, it had increased to 20 per cent. By 1977, it was 36 per cent, and I understand that it is now somewhere around 60 per cent. All this, notwithstanding the fact that the anti-dumping tribunal made several investigations in the area and succeeded in eliminating some of the damaging dumping of shoes onto our markets. Notwithstanding all of the restrictions we have had in the past, our industry is still suffering, and it is an industry which is very important to our country. Certainly it is very important in Ontario and Quebec as it is indeed in the riding of Glengarry-Prescott-Russell.
We should also be aware of the fact that most employees of shoe factories in this country are women and they are, as I stated previously, in low paying jobs. Therefore, we cannot say that shoes are expensive because of the high salaries paid in that industry. Indeed, the opposite is true, Mr. Speaker, as you will have recognized.
Perhaps, Mr. Speaker, the Minister could take few minutes to respond to the statements I have made and use the occasion to outline government policy vis-a-vis shoe imports and indicate the current state of affairs. More particularly, will she explain to us if she is aware of the policy of the Government toward the quota system which, as I understand it, is supposed to expire some time in 1986? Perhaps the Minister could respond to that.


The Acting Speaker (Mr. Paproski):: I would bring to the attention of the House that once the Minister speaks, the debate will be terminated. Are there any questions or comments on the speech of the Hon. Member?


Gordon Edward Taylor: Mr. Speaker, I just want to ask one question of the Hon. Member in connection with protecting shoe manufacturers in Canada. We have a shoe manufacturing firm in the city of Calgary which employs anywhere from 20 to maybe 200 people. They make cowboy boots, which are in great demand in the West. However, they get no protection whatsoever from tariffs. In addition to that, when they bring inspectors in from the United States to check their highly complicated equipment, there is a hassle every time and they are held up for seven or eight hours. I think this is information that the Minister should have.

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My question to the Hon. Member is this: Was he aware that the western shoe manufacturers get no protection whatsoever?


Don Boudria: Mr. Speaker, I think it is obvious that what the Member wants to do is to bring this matter to the attention of the Minister rather than to mine, and possibly to the attention of the House. It does sound like a very legitimate concern. As to why officials of American equipment manufacturers are held up at the border, perhaps the Minister would be in a better position to reply to that than I. As to whether or not there should be tariffs on boots, cowboy boots in particular, I was unaware that there was not as page 41 of the new Bill talks about tariffs on boots, shoes, slippers and so forth. Apparently the Hon. Member is saying that such tariffs may apply to boots but not to cowboy boots, which is something of which I was certainly unaware and of which quite possibly the Minister is unaware as well.
1 do believe that if we are to protect the footwear industry in this country, then the whole industry should be protected, be it cowboy boots, tennis shoes or any other kind of footwear. I do believe that in temporarily protecting the industry with a gradual phasing out of those protections, we could revitalize the industry, enabling it to obtain much needed new equipment and technology in order to compete on a long-term basis with other countries. It is obvious that the industry needs a certain period of time in order to be able to compete with those so-called developing countries with which it is very difficult for us in Canada to compete, even with the very low wages which prevail in that industry at the present time.


Dave Nickerson: Mr. Speaker, I have a couple of questions for the Hon. Member. His presentation did not really deal with the question of tariffs proper, which are under discussion, but rather with quotas, an allied matter. Is it true that the under-the-counter value of shoe quotas is something like $5 a pair? Does that not mean that the present practice of establishing these quotas costs Canadians an average of $5 a pair extra for every pair of shoes he or she buys?
Is it not a fact that those firms which squawk the loudest in support of shoe quotas are themselves guilty because they are at the same time the biggest importers of shoes? It is the same firms that manufacture shoes in Canada that want to import shoes. I wonder if any of the shoe manufacturers in the Hon. Member's constituency are guilty of that.


Don Boudria: Mr. Speaker, the Hon. Member for Western Arctic (Mr. Nickerson) is asking me whether I want to pass judgment on corporate practices of companies in my riding and elsewhere. Obviously I am not in a position to do that, Mr. Speaker. I do not think you would want me to take the time of the House to evaluate the practices of corporations which manufacture cowboy boots. That would be highly improper.
In terms of tariffs costs on shoes, I bring to the attention of the Hon. Member for Western Arctic page 43 of the Bill which describes exactly what the tariffs are. They range between 18 per cent and 40 per cent. That would obviously not
make a $5 pair of shoes worth $40 or $50 because 20 per cent or 40 per cent of $5 would not increase the amount by that much. However, it is a very necessary feature at the present time in order to enable the industry in our country to compete with similar industries in so-called developing countries.


The Acting Speaker (Mr. Paproski):: Are there any further questions or comments? The question and comment period now being terminated, I recognize the Hon. Member for Crowfoot (Mr. Malone).


Mr. Arnold Malone (Crowfoot):: Mr. Speaker, I would like to take a few moments to make some comments with respect to Bill C-9. As my friend, the Hon. Member for Bow River (Mr. Taylor), mentioned, there are a number of areas on which I believe the Department would do well to focus so as to see if we cannot clean up some old legislation which is of nuisance value. I draw the attention of the House, and in particular of the Minister, to the practice of placing an exercise tax on farm wagons.
Historically, agricultural equipment has been brought into Canada without tariff. At the turn of the century and into the 1920s the farm wagon was used for a dray to pick up the mail and the goods for the garage and the store. Farm wagons were driven by horses around the villages and hamlets across Canada to deliver the dray to various points of business. Because the wagon was used for those purposes, it was classified as a commercial vehicle in customs and tariff regulations.
At the present time, farmers will import forage harvesters from another country. Often the undercarriage of that harvester is of a light weight and the farmer wishes to have a heavier weight carrier. If the new carrier is imported separately, it enters the country unattached to the forage harvester and is called a wagon. At that point the customs and excise tariff must apply. That really related back to a 1920s regulation which no longer makes sense. There are a number of people across the country in agricultural communities who would be pleased if the Department would study this inequity.
I would also like to bring to the attention of the House the matter of bees and beehives. The production of nitrogen-fixing clovers in the country and the importing of woodstock for beehives is a very important aspect of the food producing industry. Its capacity in terms of both the leaf-cutter bees and the honey bees is important as an industry in all parts of Canada. It is simply not good enough to say that the product is made in Canada and therefore there should be a tariff on it. If the product is not of sufficiently quality for the people who use it in the industry to be satisfied with it, there should be some exemption from the tariff. That product is made in Canada, but every year representatives of the Canadian bee industry say that they want to use hives that are made in another country. I believe that we should be allowed to do that until the Canadian industry produces a quality product that is satisfactory to Canadians. I have no doubt that Canadians can make that product to satisfactory standards. Giving a monopolistic licence to market a product without there being any
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competition or any regard to the quality of the product is detrimental.
This will be the first time in history that anyone has ever corrected the Hon. Member for Bow River, Mr. Speaker. However, he made reference to cowboy boots. There is no such thing as cowboy boots except that which you give to your four-year-old children at Christmastime. However, there are western boots. There are manufacturers of western boots in Canada. They make western boots for adults but not for children. When stocking a rack with boots you must have several pairs of each size. As there are Canadian manufacturers, you must buy from them, but they do not supply children's western boots. If you wish to get your young child cowboy boots, as my friend from Bow River calls them, you will find that they are not in ample supply on the shelves because there are no Canadian manufacturers of them and we can import only a small number. I believe that that ought to be reviewed within the regulatory process. Suppliers ought not to be restricted in the number of children's boots they can import simply because the larger sizes are available.
The final point I wanted to make concerns grain drying equipment. Farm implement dealers everywhere are bringing in grain drying equipment. They bring it in as models and set up fans, screens and floorings from separate components parts. Because the fans and the screens could be used for another purpose, when they are sold the dealers must pay the full brunt of the tax. I am simply saying that as long as there is an end user certificate for the use to which they will be put, I do not believe it matters whether grain drying equipment is sold as one component or in parts.
Those who are in the grain drying import business will say that there is a problem with selling component parts. It is often not necessary to bring in the full equipment because component parts can be added to existing facilities. It should not be mandatory to buy a full set of equipment when it is satisfactory to add component parts to the existing facilities.
My comments were intended simply to point out that there are some inequities in the customs and excise tariffs which can be improved upon in the regulatory process. I would encourage the Minister to review those and, if possible, to make the necessary changes.



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Paproski):: Order. It is my duty, pursuant to Standing Order 45, to inform the House that the questions to be raised tonight at the time of adjournment are
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as follows: the Hon. Member for Broadview-Greenwood (Ms. McDonald)-Cultural	Affairs-Budgetary	Cut-backs-
Consequences for Cultural Community. (6) Artists' Income; the Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria)-The Census-Justification for Cancellation of 1986 Census. (b) Request that Cancellation be Rescinded; the Hon. Member for Algoma (Mr. Foster)-Agriculture-Flood Damage Compensation for Farmers in Northeastern Saskatchewan. (b) Request for Immediate Payment.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mrs. McDougall that Bill C-9, an Act to amend the Customs Act and the Customs Tariff, be read the second time and referred to the Committee of the Whole.
Nelson Andrew Riis: Mr. Speaker, I listened with interest to the Hon. Member's comments about western boots in particular, as well as concerns raised by others about the boot industry. As an experienced outdoorsman in western Canada, does he know that a similar situation exists with firearms? This is in terms of duties that are paid on firearms that theoretically are available in Canada. However, upon examination, one finds that the firearms that are available to western retail outlets must be sourced in central Canada at a significantly higher price and in some cases, by their own admission, at somewhat lower quality. The same applies to ammunition. Does he have any experience with this as well?


Arnold John Malone: Mr. Speaker, I can only attest to the fact that I am in fact aware of and in agreement with the observations that were made by the Hon. Member for Kamloops-Shuswap (Mr. Riis).


Steven W. Langdon: Mr. Speaker, it is interesting that a number of the Bills which are coming before the House in its early stages permit us to set out some of our philosophical approaches to such issues as taxation, which we dealt with this morning, and trade, with which we are dealing now. Since the Minister has launched consideration of Bill C-9 by giving us an outline of her approach to trade and the approach that the Government is taking toward trade, I want to comment on that approach and offer some counterpoising of a different approach which our Party intends to put forward.
In my opinion, the Minister was speaking very much in a framework which saw the need for us to move toward more free trade. It was in a framework that saw that movement taking place in a multilateral context, with GATT playing a

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very important role in the process, with safeguards being maintained for Canadian industry as this process is developed.
Of course, there are a number of other variants on this commitment to greater free trade. Some people are talking very much in terms of establishing our free trade with the United States unilaterally rather than with all the countries throughout the world. Again, there are variations within that approach. Some people talk in terms of sectoral approaches to such free trade, while others talk about an approach that moves across the board.
When we consider international trade in the 1980s, our Party questions the strategy of developing greater free trade. When one looks at the evidence, the reality is a movement throughout the world toward managed trade.
This type of trade operates at two levels. First, there is managed trade at the level of governments themselves. We have seen a movement by governments, both in developed countries and less developed countries, whereby a great deal of special financing is available for exports. They have many agencies operating in an attempt to promote trade expansion and penetrate new markets. In short, we see an attempt by governments to build for themselves new areas of comparative advantage in the international economy which will provide their respective countries with jobs and growth prospects in the future. This is not only evident in western European countries but it is evident also in the United States where, despite the free trade rhetoric of the Reagan regime, there have been a great many moves in recent months that threaten our economy and other trading economies throughout the world as a result of new forms of restrictionism within the United States. The most recent example is some provisions in the steel industry which have established particular labelling requirements for steel exporters to the United States. This has the effect of making our capacity to export to that economy a great deal more difficult.
I think most Members are aware that in addition to the Government's efforts to manage trade, we must recognize the effort on the part of large-scale firms to manage and organize trade internationally. In this respect we can talk of two kinds of development. First, there is the effort on the part of large corporations to set up for themselves an international system of sourcing abroad. At present, large international corporations use subsidiaries in different parts of the world to supply particular components to parent companies in the United States or western Europe. For instance, estimates of the situation in the United States indicate that close to 60 per cent of U.S. manufacturing trade takes place in the internal framework of the corporations themselves. This means that the prices that are established in that trade are often quite arbitrary and questionable.
In addition to this effort to set up international corporate structures to organize trade throughout the world, we see an increasing effort on the part of corporations to attempt to develop trade strategies based on a careful working through of new product developments and heavy expenditure on research and development within those product areas. They attempt
then to allocate to particular subsidiaries throughout the world responsibility for that product once it is developed by the company.
We see a good many companies here in Canada which now have world mandates for particular products which have been developed through research in their parent companies. In these and other ways we have a movement toward managed trade in the corporate sector as well as in government legislation and regulation. I think for us to respond in the world as it is changing by being a good boy scout, by talking about freer trade when nobody else is practising it, by suggesting that, left to the market, somehow the trade that we as a country need to grow will just emerge, represents an incredible exercise in naivety. It represents an abdication of responsibility as a Parliament to the millions of workers in Canada who could be affected by this. It represents irresponsibility with regard to the thousands upon thousands of small business people who could find their hopes and opportunities eliminated.
I agree with my colleague from Saskatchewan who made the case for free trade that it is something that could benefit many of us. But free trade is not on the agenda of the world today. We can look all over the world, we can look at Southeast Asia, western Europe and, the United States. Freer trade is not the direction in which countries are moving. Managed trade is the direction. For us as a small nation in this difficult and open environment, faced as we are with our own severe economic problems, simply to back off and say we will leave it to free exchange throughout the world, is not only naive but incredibly irresponsible.
It is particularly irresponsible to talk about establishing this kind of free exchange system with the United States. It is above all within the United States that the corporate sector is moving effectively, and because it makes sense for them, in the direction of more and more manged trade. We would find ourselves like the poor fly caught up in a spider's web. We would be at the outer extremities of a system of trade that has been built on the U.S. market itself. We would find company after company that presently has subsidiaries here looking to rationalize operations continentally and leaving us without any capacity to safeguard jobs and to protect our potential for growth for the future.
We will be bringing before this House tomorrow a case where precisely this kind of thing has happened. I am speaking of a takeover by an American company of the operations of a segment of Westinghouse responsible for small appliance production. Black and Decker has taken over these operations and is now in the process of rationalizing production. At the moment it can only rationalize production within Canada because we still have some trade restrictions. FIRA still exists and can still operate, but the result is that an operation is being shut down in Barrie, Ontario, which presently employs 600 people who are represented by a good Conservative Member of Parliament.
November 26, 1984


Mr. Stewart:: Mr. Speaker, I rise on a point of order. The Hon. Member is incorrect. He referred to Westinghouse when he meant General Electric.


Steven W. Langdon: The Hon. Member for Simcoe South (Mr. Stewart) is correct. It is a General Electric subsidiary rather than a Westinghouse subsidiary. I apologize.
The point is that a company has been taken over by another parent company, which in turn is attempting now to rationalize its world-wide operations, and in the process of doing so is threatening the jobs of 600 workers within a community in Ontario.
We see the chance of this kind of development in the future becoming more and more prevalent if we move in the direction of free trade with the United States. Some people are talking about an alternative which they call sectoral free trade. This moves in the same direction but will do so industry by industry. We have had some experience with that in the case of the automotive sector. We have seen that such movements can be beneficial to the Canadian economy, but only if safeguards are established that defend the industry by committing subsidiaries here in Canada to a specific level of Canadian content production in what they sell here. In the case of the auto pact, for instance, companies have committed themselves to 60 per cent Canadian content as an equivalent for each dollar's worth of sale of their vehicles here in Canada. We feel that that principle of Canadian content has to be there within any movement to sectoral free trade with the United States, or indeed with anybody else.
We believe strongly, and we have had it on good faith from negotiators from the United States, that they are not prepared to initiate and include safeguard arrangements in any of the sectoral free trade movements which they are presently talking about.
We would put ourselves in a situation where we would not be able to protect ourselves as we have been able to do in the auto industry. Rather than moving in this direction of freer trade, Mr. Speaker, we think the world as it is requires us to talk about what we in this Party call fairer trade, an attempt to establish, through the activity of government in close consultation with the corporate sector, with trade unions, and with communities across the country, a system of safeguards that will permit various key sectors of our industrial economy to expand effectively, to initiate more research and development and to use that research and development to penetrate new export markets, not on the basis of special arrangements with those markets but on the basis of competitive quality products which can be produced by Canadian workers and communities. We think particularly of sectors that are crucial to our future, for instance, the automobile sector.
It is important for us to accept the principle of the recent task force on the automotive industry of establishing Canadian content rules, not just with the United States and American companies as we presently have, but with Japan and Japanese
Customs Act
companies. As I have stressed previously in the House, this industry now cuts across the country. It is not just an Ontario and Quebec industry. There are automotive investments in provinces such as British Columbia and on the other coast in Nova Scotia. If we move in the direction of serious efforts to build in Canadian content laws as the task force report suggested, we will have before us 30,000 to 50,000 new jobs which will benefit the entire country, not only central Canada.
Also I want to make it clear that when we talk about fairer trade, we are not talking about always building in more restrictions. We are also talking about seeing to it that our restrictions deal fairly with the different trading partners with which we are involved. For instance, at the moment we apply quotas in areas such as textiles and clothing to poor developing countries when those countries themselves are often not the threat. If we look at the case of textiles and clothing, we see that many of the threatening imports these days come not from Sri Lanka, against which we have quotas, not from Malaysia, against which we have quotas, not from India, against which we have quotas, but from the United States, against which we do not have quotas because frankly we are frightened to do so.
Our argument is that in establishing a system of fairer trade, it is important that we treat our trading partners equitably and that we approach them in an even-handed manner. We should stop making the Third World and poorer countries pay the price for competition in some of our poorer, more difficult industries. This competition is in fact coming much more from the United States and other parts of the world which are a good deal better off.
We lay before the House today an approach to trade strategy which emphasizes fairness rather than the freeing of the economy. If we adopt that approach, we will be safeguarding jobs for the future and much more effectively building the capacity to expand our economy through exports and through growth in the future.


Blaine Allen Thacker: Mr. Speaker, I have a comment or two and then a question for the Hon. Member for Essex-Windsor (Mr. Langdon). I disagree that the world is not moving toward free trade. If the Hon. Member as a member of these parliamentary committees will be able to visit Hong Kong, Korea, parts of the Philippines and Malaysia, he will find that the future lies with free trade if we get on the ball and capture our fair share. The whole sense of his speech was that he was fearful of free trade. We should look at Canada with its magnificent resources, our population, the fact that we have a higher standard of education than anywhere in the world, a stable political environment and an effective economic infrastructure. We have huge multinationals. Our banks are huge multinationals. There are four or five big oil companies in Canada, with 700 oil and gas companies mostly based out of Calgary. A good number of them operate on the international sphere. They are incredibly productive and valuable.
Why does my friend fear for their ability to operate? Why does he want to have protections which will hurt us? Indeed, a closed trading pattern will hurt our country more than any
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November 26, 1984
Customs Act
other country in the world. We trade even more than the Japanese for our wealth and welfare. Why does he want protections? Would he not think that Austria's trading practice vis-a-vis Germany is a good example to follow? That country has opened itself up, and its productive citizens have found thousands of niches within which they can fit and send products to Germany. As a result, its national wealth has risen enormously. Why does my friend appear to be fearful?


Steven W. Langdon: Mr. Speaker, I appreciate the question. It is a very good one. However, I suggest to the Hon. Member that his assumption is wrong. I certainly do not have a sense of fearfulness about the capacity of our country, our companies and our communities to compete. I am concerned about our country sending out our companies on which workers depend into the international market-place unassisted, unaided or unsupported by our Government and our trading strategy.
I have had a certain amount of experience with Southeast Asia. Recently I visited South Korea, Singapore and Hong Kong. I assure the Hon. Member, as indeed I am sure he is aware, that South Koreans do not let their companies go into the international market-place unsupported. We should ask why it is that Hyundai has succeeded in penetrating the market for automobiles in Canada in such a spectacular fashion. There has never been a more spectacular entry into the auto sector than in the case of Hyundai. Hyundai is strongly supported by the Korean Government. There is a major effort on the part of the Koreans to promote such exports and at the same time a very strong effort to see to it that Hyundai cars which are exported have a far higher Korean content than anything we require.
In the case of Hyundai and the Pony cars which come to Canada, over 93 per cent of cars produced in South Korea are produced with Korean content; 93 per cent of the value added in those vehicles is Korean. If we are to realize our tremendous capacity, the way to do it is not to leave our companies on their own. It is not to pretend that the world is some kind of easy picnic in the international market-place these days. It is to be out there supporting our companies, working closely with them and developing a strategy to build effectively upon our capacity.
This is what we are talking about when we talk about fair trade. This is why we make a distinction between that and free trade, which I think is a recipe for leaving our companies unprotected in what is a terribly difficult world. Some of them will still succeed, some of them will still do well. However, many of them could do much better if we worked aggressively with them and we recognized how naive it is to pretend that the world is not moving toward a managed trade system rather than a free trade system.


Blaine Allen Thacker: The Hon. Member opposite referred to the automobile industry. Would he agree with the action taken by the government in the early 1970s? When the oil price was rising, our government stepped in and said that we would not be subject to any blackmail from the Arab community, and we subsidized it. The effect of that was to send signals to Canadians to continue to buy big cars and to manufacturers to continue to build them. In the meantime, Japan, Germany and many other countries with governments that faced reality used their top brains to create more efficient and lighter cars. The reason they are whipping us in the market is that our industry was misled by the government and led down the garden path. It happened because of that action taken by the government.
I suppose I am asking the Hon. Member to consider that as being a case which argues for government being very circumspect in its decision-making and that if it is to help industry, it be very careful in the way it does so. That was a clear example of a government decision that mortally injured the industry. Tens of thousands of people were put on the unemployment rolls because of the decision that was made back in the early 1970s.


Steven W. Langdon: Mr. Speaker, having read the Hon. Member's speech earlier, I have heard that argument before. In fact, Mr. Speaker, the direction in which the auto industry moved in the early seventies was a function not of Canadian Government policy but of what was happening in the United States. Unfortunately, the great overwhelming majority of research and development in that industry is now concentrated in the United States and responds very much to changing incentives and regulations imposed by the U.S. Government.
My own view is that the U.S. Government, by forcing its auto companies to move in the direction of more fuel-efficient cars, saved that industry for the 1980s. Without those government regulations, the U.S. auto industry would not have moved fast enough. It would not be in a position to compete in the way that it is finally beginning to compete internationally.


Dave Nickerson: Mr. Speaker, I have a brief question for the Hon. Member. Who really speaks for the NDP on this issue? Is it the Hon. Member for Kamloops-Shuswap (Mr. Riis), who argued in favour of liberalized trade to help the developing nations? Is it the Hon. Member for Prince Albert (Mr. Hovdebo), who also argued in favour of liberalization by showing figures to the House indicating that western Canadian agriculturalists were subsidizing inefficient industries in eastern Canada? Is it those two gentlemen from the West, or is it my antediluvian friend from the East, who continues to argue in favour of protective trade or managed trade or trade of whatever name he wishes to give it?


The Acting Speaker (Mr. Paproski):: The Hon. Member for Essex-Windsor (Mr. Langdon) for a very short answer.


Steven W. Langdon: Mr. Speaker, we talk in terms of fair trade, an approach that would look sector by sector and region by region across the country to find ways in which our trade strategy can help to build our economy. Unlike the Conservatives, we do not believe that there is a single easy answer to everything. We do not believe that there is some ideological answer sitting in the textbooks that can be picked out. Instead, we speak for a strategic effort to use trade strategy to build
November 26, 1984

our economy. This in some cases would lead to more restrictions and in other cases would lead to fewer restrictions.
[Translation\


The Acting Speaker (Mr. Paproski):: Questions and comments are over.

Is the House ready for the question? The Hon. Member for Hamilton East (Ms. Copps).


Ms. Sheila Copps (Hamilton East):: Mr. Speaker, I will be brief because I know that the Government is anxious to move to the question on the issue of the Customs Act and Customs Tariff. Most of those proposals were in fact proposals that had been introduced by the previous Liberal government. Naturally I am anxious, as are my Liberal colleagues, to move ahead with its passage.
At the same time, I wonder if the Minister who is carrying the Bill might clarify something to this House. Was the omission from this particular Bill of any particular response to the U.S. Government's congressional decision to limit the importation of steel products, particularly with respect to the labelling issue, intentional? The labelling issue has been brought to the attention of the Minister for International Trade (Mr. Kelleher) by myself and as well has been brought to the attention of the Prime Minister (Mr. Mulroney) by myself and by my Liberal colleagues. I wonder if the Minister might clarify for the House what action she is contemplating with respect to customs and tariff changes that may come about as a result of the U.S. Congress decision to restrict steel imports into the United States because of peculiar labelling procedures?
I understand that government members have been endorsing the concept of free trade, not only on a sector-by-sector basis but also on an over-all basis. I know that those same Members would be most happy to agree with me and my Liberal colleagues when we say that if there is one industry in the world in which Canadians have shown themselves to be competitive on an international scale, it is the steel industry.
Perhaps the Minister could clarify to the House if, in fact, the labelling situation cannot be resolved through the efforts of Canadian lobbyists who are now working feverishly in Washington on this issue. Perhaps the Minister could clarify to the House what action she would be prepared to take with respect to tariff admendments which would in fact enforce similar restrictions on importation of foreign steel products into Canada.


Mr. Speaker:: Tradition requires me to inform the Minister that if she speaks, she closes debate on this matter.


Barbara Jean McDougall: Yes, Mr. Speaker, I am aware of that. In answer to the Hon. Member's question, the Government is looking at the question of the steel industry. It does not relate particularly to this Bill. I cannot answer the Hon. Member directly on the labelling issue but I will refer it to my colleague
Designation of Nova Scotia
and we will respond to her. However, the matter does not relate to this Bill.


Mr. Speaker:: Is the House ready for the question?


Some Hon. Members:: Question.


Mr. Speaker:: Mrs. McDougall, seconded by Mr. Hnaty-shyn, moves that Bill C-9, an Act to amend the Customs Act and the Customs Tariff, be read the second time and referred to Committee of the Whole. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.
Motion agreed to and Bill read the second time.


Mr. Speaker:: Accordingly, the Bill stands referred to Committee of the Whole.
I suspect that it is probably in the best interests of the House to consent now to call it five o'clock.


Some Hon. Members:: Agreed.


Mr. Speaker:: It being five o'clock, the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper. Shall all orders and items preceding Number 6 stand by unanimous consent?


Some Hon. Members:: Agreed.


PRIVATE MEMBERS' BUSINESS-PUBLIC BILLS   THE OFFICIAL DESIGNATION OF NOVA SCOTIA ACT MEASURE TO ENACT
[Stage Direction]
Mr. Pat Nowlan (Annapolis Valley-Hants) moves that Bill C-201, an Act respecting the official designation of "Nova Scotia", be read the second time and referred to the Standing Committee on Justice and Legal Affairs.
He said: Mr. Speaker, in the true tradition of private Members' hour, there should not be much debate on this Bill which is so patently fair, progressive and highly principled on the face of it. I certainly do not wish to take the entire time of the House between five o'clock and six o'clock, but I do want to describe briefly my private Member's Bill which I brought before the House on another occasion several years ago. After that, I remained quiet about the Bill because of the sensitivity of the bilingual question that seems to come up whenever I raise this Bill.
As far as I am concerned, if there ever was a reason for a private Member's Bill, there is a reason for Bill C-201, which is comprised of only one paragraph. It is a private Member's Bill which deals with a matter of public interest to the people
[Stage Direction]
November 26, 1984
Designation of Nova Scotia
of Nova Scotia involving no more and no less than the proper use of a proper noun in the proper context.
The proper noun we are dealing with, of course, is the name "Nova Scotia", which is Latin and, in my humble submission, therefore is not translatable to either English or French. If, under the BNA Act and under its original Charter, Nova Scotia was called "New Scotland", then in our day of bilingualism, the translation for that would be "Nouvelle Ecosse". However, the fact of the matter is that the name is Nova Scotia. It is a proper name that comes from a grant made by King James I to William Alexander in 1621. This was before Canada was ever even conceived of in terms of any constitutional arrangement. There were Indians present, and I shall return to that.
There are many names in Canada, historic names which reflect our history and heritage, which are not and should not be translated. I must say that this Bill germinated when I was a new Member of Parliament. This is why I am glad to raise it again in a new Parliament which consists of so many new Members. I was a Member of a new Parliament back in 1966 when in this far corner of the Chamber a very eminent Canadian, who happened at the time to be an independent Member and the ex-mayor of Trois-Rivieres, Mr. J. S. Mongrain, rose in his place every time an anglophone mentioned the words "Three Rivers". He would bring the proceedings to a halt. I suppose there were times in that new day of bilingualism that anglophone Members were irritated at the question of privilege or point d'ordre being raised on the use of the name Three Rivers.
Then there was the interesting situation of another eminent federal Member at the time, who has had some eminence in Quebec politics since that time, Gilles Gregoire. He represented part of the riding which now encompasses Sept-Iles. I worked in a place which was known as Seven Islands when the Iron Ore Company was only a dream. Before the railway was built along the Moisie River there was a fishing village with a population of 1,500 which was known as Seven Islands. However, quite properly attention was drawn to the fact that under the Charter of Seven Islands the proper noun for Seven Islands was Sept-Iles. Those points were made and they were accepted.
I submit that my case is even stronger than the cases which I have mentioned. I am not talking about a translation; I am talking about the use of a proper noun in the proper context. If there are Members, Nova Scotians or Canadians, who feel more comfortable using other appellations for my Province, then let them use them. The Bill does not restrict anyone or make it illegal to use any other name. Obviously I know the name that a majority of the people in my Province are familiar with, that is the name of la Nouvelle Ecosse. If in their social context and in their dialogues they feel more comfortable using Nouvelle Ecosse, so be it. Depending on the results of this debate today, the point of truth, frankly, Mr. Speaker, may become perhaps a problem between you and me. I believe
it is high time that a name which has existed for three and one-half centuries, which is neither English nor French but is Latin, should be the proper noun which is used for my Province. I will have to consider my position and how obstreperous I will become if this Bill does not find favour with the House.
I will not quote all of the Latin of the King James Charter which was given to Sir William Alexander, although it is beautiful stuff. There are pages and pages of Latin which relate to Nova Scotia. That is the first part of my case.
One can say, "What is in a name?" I will cite some interesting and ridiculous situations with respect to what is in a name.
When I was first in this House, Mr. Speaker, one of your eminent predecessors was Mr. Speaker Lamoureux. He was a very gracious Speaker and obviously a great predecessor of yours. However, on the English side we did not call him "Mr. Lover". Nor did we call Gilles Lamontagne, the former Minister of Defence, "Mr. Mountain". We did not call and do not call Madam Sauve, "Madam Saviour", although she was a Speaker who certainly saved the decorum of the House from completely breaking down from time to time. We did not do that because it would make a mockery of the sincerity and seriousness of bilingualism for us to become too fervent in deciding that every word should be translated, especially proper nouns. It is grammatically incorrect to translate proper nouns into another language, be it from English to French or from French to English.
In the present Cabinet we have Roch La Salle. Are we going to call him "Roch the Room"? We also have John Wise. Are we to call him "Jean Le Sage"? That obviously points to the absurdity of the matter. We could do it with Andree Champagne, who is a lovely lady. I have not had the pleasure of formally meeting her too often, but I will certainly call her by her name and not "Andree Field". That would be a mockery and an insult to her.
All I am asking is for fairness in using the proper nouns in the proper context. The Bill is very simple. Paragraph 1 reads:
This Act may be cited as The Official Designation of Nova Scotia Act.
That is simple. It does not pose a problem. The second paragraph reads:
In every place where the words "Nova Scotia" appear in any Act, regulation, statutory instrument, report, contract, lease, licence or other document the proper designation of such name in both official languages is and shall be "Nova Scotia".
I will not get into the situation of wanting rewritten all the laws which must be translated. I simply want to ensure from this day forward that we will not translate proper nouns when those words are not translatable.
I know Members in this House are versed in history and I do not want to take much of the time of the House, but I found it interesting, when I researched this matter, that the very name of Canada is an Indian name. We do not translate that. Ottawa is a very interesting Indian name. It perhaps typifies what we do in this city, but it is not translatable. Quebec,
November 26, 1984
[Stage Direction]
Ontario, Manitoba, and Saskatchewan are other well-known proper nouns which are not English or French, but Indian and, therefore, not translatable. In terms of the name of Canada, there is some conflict in history which obviously occurred when Jacques Cartier sailed up the St. Lawrence and picked up some guides along the way. Those guides were probably Iroquois. They referred to the villages along the St. Lawrence as Kanata or Canadia. In effect, the translation from Iroquois was that this was the place of cabins or lodges. The translation of that into French from Iroquois became "Canada". That is fine. We do not want to destroy the heritage of 1867. We have the Constitution Act, the flag, the national anthem, and a Supreme Court which can stop things in Ottawa. We have done things to emancipate our national identity and to develop our heritage. Surely we do not want to turn back the clock in this context.
In terms of other names, we could take the great Province of Ontario. "Ontario" comes from two Iroquois words. I will not try to translate them, but in effect Ontario means "beautiful lake". Quebec is Algonquin, and means "where the river narrows". The other side of that is Detroit, but I will not get into that. Saskatchewan comes from the Cree language and means "rapid current". Manitoba again comes from the Cree language and means "the strait of the Manito" or "the strait of the spirit". The most interesting example is that of the capital city itself, Ottawa. I believe "Ottawa" comes from the Algonquin language and means the place to barter or the place to trade. I must say that the Indians knew years ago, before anyone ever thought of this place-which used to be called Bytown-that it would be the place where we came to trade or to barter.
These names are not translatable and they should not be translatable.
I would like to delve into history for a moment to amplify what I said about Sept-Iles and Trois-Rivieres. The history of this is perhaps the evolution of Canada and of Quebec. There was a Bill introduced in 1915 in the Statutes of the Province of Quebec which referred to the City of Three Rivers. Then, because of many happenings and obviously the emancipation and the movement of the English and the French, in 1925 there was an amendment under the Statutes of the Province of Quebec which amended the English name "Three Rivers", and in effect said that the inhabitants and ratepayers of the City of Three Rivers would henceforth be known as inhabitants of the "City of Trois-Rivieres". It was because of that history, Mr. Speaker, and I believe, quite properly, that Mr. Mongrain, as an independent Member of Parliament-and I sat back there against the back wall-whenever Three Rivers was mentioned by any speaker, would stand and in a very proper way draw to the attention of the House that this was not the proper name.
I will quote from an excerpt of Hansard of March 25, 1966, at page 3195. With regard to the estimates of the Department of Transport-that was when we had full supply in the House-Mr. Mongrain said this, among other things:
Designation of Nova Scotia
For the last 15 years, Mr. Chairman, the municipal councils. Chambers of Commerce, both junior and senior, and the school boards of my home town and riding have been writing to the various federal departments to underline the fact that the name of my home city is Trois-Rivieres. This is true even in spite of the English version because the city is incorporated under the name of Trois-Rivieres. A proper name is not translated and it is a grammatical error to translate a proper name. For instance, the name of our Speaker is Mr. Lamoureux but I would not speak of him in English as Mr. Lover. Mr. Batten is an English name but I would not call him. Mr. Planchette if 1 were speaking French to him. We have a minister by the name of Mr. Winters but 1 would not call him Mr. Hiver if I were speaking to him in French. The name of my riding is Trois-Rivieres and I do not know how many hundred times we have to emphasize that fact.
Mr. Mongrain continues, in another part of his discourse, saying this:
But the pride we show in wanting our city's name to be expressed in our mother tongue should not be held against us.
This is the point I want to make. I take great pride in Nova Scotia even though I am basically of Irish heritage. We have a fine Scottish heritage. There was a grand fellow by the name of William Alexander. We have the celebration of the meeting of the clans. We have the tartan and the kilt. We take pride in our heritage. The fact that I am today pushing for the use of the proper name when referring to my Province is because of the respect I hold for my province, and for no other reason. It is a principle, as far as I am concerned, Mr. Speaker. I only ask for the same fairness given to me as was given Mr. Mongrain with "Trois-Rivieres" today and in the future.
I will not go into the whole evolution of history today, Mr. Speaker, because I would like other Hon. Members to contribute to the debate. But I repeat that I believe we make a mockery of bilingualism by translating names which have the strength of history behind them without the popular acceptance of the people who believe in their heritage. My home town, Mr. Speaker, is a place called Wolfville. It happens to be the seat of Acadia University. The whole history of the area comes from the Acadians. Every Nova Scotian and every constituent in my constituency talks about Grandpre. We do not talk about the "Big Meadow". We do not call Wolfville "La Ville du Loup". My mother was born in a place called Canard. I have heard about canards being used in canard a l'orange, but I have never known the area surrounding my mother's farm being known as "The duck land", Mr. Speaker. We do not call Whitehorse "Cheval Blanc". We do not call Mont Joli "Mount Jolly". We do not call the riding of the former Prime Minister "Royal Mountain". And, Mr. Speaker, we do not call Baie Comeau "Como Bay". I do not think we should.
I say to you, Mr. Speaker, that in fairness, equity and in history, this Bill goes right back to the 1621 Charter. I have a photostat of the BNA Act which is in English because we had evolved from Latin to English. We were not bilingual then. I would like an Hon. Member or the Table Officers to point out to me where there has been the legal move to use the name "Nouvelle Ecosse" or "New Scotland" in referring to the Province of Nova Scotia. I can tell you, Mr. Speaker, that by the proclamation of Queen Victoria which brought us into nationhood-and Nova Scotia, of course, was one of the four founding provinces-the Provinces of Canada, Nova Scotia
[Stage Direction]
November 26, 1984
Designation of Nova Scotia
and New Brunswick are united into one dominion under the name of "Canada". I suggest and submit, Mr. Speaker, that the 1867 proclamation brought us into being. Even in the Constitution Act of 1982, or whenever it was, which in effect reaffirmed the BN A Act and made the Constitution more modern, there is not a section in the statute which gets close to what they did with Trois Rivieres-Three Rivers officially to designate the change from Nova Scotia to any other name.
It is for that reason, Mr. Speaker, that 1 am happy to have had the chance to speak for these few minutes before the House. I hope I have not over-stressed the point, but I do believe it is time we considered this matter seriously. One can say, "What is in a name?" But long ago an Hon. Member of this House, the Hon. Member from Shawinigan, stood in this House during a private Member's hour and wanted the name of Trans Canada Air Lines changed to that of Air Canada. There was quite a debate and the Bill went through. That was many years ago when that Hon. Member was relatively new. 1 do not expect the same hallelujah if my Bill goes through today. That was one of the first Bills to, in effect, make a name almost "alingual", but I do not even have to face that. The proper name of my Province is Nova Scotia; it is not New Scotland, it is not Nouvelle Ecosse.
I ask the consideration of the House to reflect on my remarks. Hopefully, the reflection will conclude before six o'clock so that this Bill can be properly referred to the Standing Committee on Justice and Legal Affairs. I believe that if we do get it that far, it is high time that Nova Scotians, including its Premier, addressed this problem.
Don Boudria: Mr. Speaker, I am pleased to be taking part in the debate on this Bill.
In fact, I was reading about past debates on the subject in some old volumes of Hansard, and I cannot help wondering why another attempt is being made to bring this legislation before the House today. I must say that I wish it were a quarter to six or six o'clock or whenever we are going to vote on this Bill this evening, because it will be very interesting to see how our Quebec colleagues in the Progressive Conservative Party vote on this particular Bill.
I intend to be very brief to give these Hon. Members an opportunity to take part in the debate and show us how they intend to vote.
Mr. Speaker, the history of the Acadians in Canada is very important, although at times many Canadians have trouble remembering that particular history.
The Hon. Member who is sponsoring the Bill referred to the Acadians earlier, but I think his remarks need some elaboration. We should remember what happened in 1755, remember the deportation of the Acadians and their arrival in large numbers in Louisiana and related events.
Today, we should also remember the day when the Conservative Government of our country closed the consulate in
Louisiana, which I think was a slap in the face of the people of Louisiana, especially Acadians. Today, this Bill is once more before the House.
Mr. Speaker, I must say that as a Francophone outside Quebec, I am very reluctant to support this kind of legislation. That is why I fully intend to vote against the Bill, and I also wish to take advantage of this opportunity to urge my francophone colleagues here in the House of Commons to do the same, especially our colleagues from Quebec on the other side of the House. I would urge them, first, to rise in the House and let us know what they think of the proposed legislation and give us their views, and second, before the House adjourns this evening, to vote against the Bill.
We are told that the reason for presenting this Bill is that in 1621, the province was given the name "Nova Scotia". That may be so. In fact it must be so, because the Hon. Member said so. However, Mr. Speaker, in 1621 legal texts were probably all written in Latin. I therefore fail to understand why it is so important for us to remember this particular incident today. It is quite possible that at the time, a lot of other things were given Latin names as well, but today, these have been translated into other languages. Prince Edward Island is called "l'lle-du-Prince-Edouard" in French, and when I go to the Maritimes next year, I want to be able to go to Nouveau-Brunswick, if that is what I want to call that province, and to "la Nouvelle-Ecosse", if that is how I want to call that province. If the Hon. Member wants to go on calling his province Nova Scotia, he is welcome to do so. I think we should keep the province's French name, the way it has been translated for centuries. It is correct, and I think especially in the present context, it is a way of showing the Acadians of our country some small recognition, and we certainly owe them at least that.


Mrs. Monique Landry (Parliamentary Secretary to Secretary of State):: Mr. Speaker, as this is my maiden speech in the House as Parliamentary Secretary to the Secretary of State, I would like to start by congratulating you on your recent appointment.
I would first like to provide a few explanations on the origin, the functions and the responsibilities of the Committee responsible for geographical designations in Canada.
The first organization in charge of controlling geographical names in Canada was created by Order in Council in 1897 under the name of Geography Commission of Canada. In 1948, this Commission became the Canadian Commission of Geographical Names, and in 1961, it received its present designation of Canadian Standing Committee on Geographical Names.
The Committee is made up of seven representatives from Federal Departments and one representative from each province in Canada appointed at the provincial level. The
November 26, 1984

Committee rules on all nomenclature issues involving Canada. Toponyms within the provinces become decisions of the Committee upon a ruling by the provinces involved. The Committee is assisted in its work by four advisory committees in charge of names, linguistic policy and research. There are about 300,000 officially approved names in Canada.
The Official Languages Act and the Canadian Charter of Rights and Freedoms determine the policy of the Federal Government as far as the policy of the Canadian Standing Committee on Geographical Names is concerned. The Committee must therefore see to it that when members of both official language groups use federal maps they are served with consistency and fairness. Toponomy is also one of the essential elements which help create our national image as a country where both official language groups share a common heritage, each one designating major geographical entities in its own language.
To better meet the needs of Canadians of both official language groups, names which appear on federal maps must first of all match those used in legal documents, that is the names adopted by the provincial authorities within their own province and by federal authorities within the regions under their jurisdiction.
The purpose of a federal approach would be to determine which are the place names of geographical entities that are of national interest in both official languages. These names should be considered part of the collective ownership of the Canadian people, or in other words of its national heritage.
Mr. Speaker, the Canadian Permanent Committee on Geographical Names has been guided for a long time by the principle that, excluding entities under the jurisdiction of the Canadian government such as Indian reserves, national parks and Canadian Forces bases, geographical names are a provincial matter. The names of the provinces themselves, of course, are a different problem. According to the Department of Justice, the name of a province is that used in the Constitutional Act under which that province entered Confederation. In the case of Nova Scotia, that act of course is the British North America Act, a statute originally passed in English only. The Department of Justice is currently preparing an official French version of that act. However, all previous French versions of that act referred to "Nouvelle-Ecosse". There is therefore no reason to believe that the latest text will be any different.
Be that as it may, since constitutional documents are involved, the Canadian Government could not make changes without having them approved by the provinces. In the same way, provinces could not change their names without requesting the Canadian Government approval. We may therefore conclude in my view that this is an area of joint jurisdiction, where the lead should preferably come from the Legislative Assembly of the province concerned.
With respect to geographical names, past and present practice has been and is one of the main elements to be considered. Now, the use of the name "Nouvelle-Ecosse" in
Designation of Nova Scotia
treaties, in historical works, on maps and in geographical documents dates back to the 18th century. It has been in continuous use since then and remains current usage not only among French-speaking Nova-Scotians and Canadians generally, but throughout the French-speaking nations. That was the name used in the 1713 Treaty of Utrecht, under which France finally yielded Nova Scotia to Britain. It must be remembered that, first settled by France under the name of "Acadie", Nova Scotia was under French rule from 1667 to 1710. On the other hand, even if the name "Nova Scotia" is indeed of Latin origin, it has long since ceased to be perceived by people in that province and Canadians in general as anything but the English name of a very predominantly English province.
Mr. Speaker, this may be but a technicality, but one should not overlooked the fact that if Nova Scotia's official name were to be changed, changes would have to be made not only to federal statutes but also to all official documents, maps, and so on, bearing the name of that province. On the other hand, such a change, at a point in time where over-all Canadian attitude to bilingualism is entering a phase of greater tolerance and more general acceptance, might very well stress relations between those two linguistic groups and polarize their mutual positions. The name "Nouvelle-Ecosse" is part of the cultural heritage of Nova-Scotians and all Canadians.


Sheila Maureen Copps: Mr. Speaker, as the great great grandchild of a person who came to Cape Breton from the great country of France in the 17th century, it pains me to see that the motion introduced in this House today would see only one version of le beau nom de la Nouvelle Ecosse in documents from this day forward if this Bill were to pass. It also pains me as a student of Latin who has taken some interest in how languages are developed to look at the rather irregular logic of the Hon. Member for Annapolis Valley-Hants (Mr. Nowlan) in proposing this. He is suggesting that, because the origin of the two words "Nova Scotia" are Latin, it continues to be a Latin name. I think if he takes the opportunity to study the evolution of languages, including English, he will no doubt be aware, as was stated by the previous speaker, that when a word is incorporated into a language for many years, in some cases for many centuries, it becomes part of the idiom of that language. This is clearly the case in the use of the two words "Nova Scotia". The words "Nova Scotia" are incorporated into the English language and, as such, deserve a French translation.
I would point to other current uses of words in the English language which can be drawn from French origin such as the word "serviette". Serviette is a French word which has been incorporated into the English language to illustrate a small

November 26, 1984
Designation of Nova Scotia
piece of paper towel which we use to clean ourselves after a meal. At the same time, the origin of that word is from the French word "serviette" meaning a towel or towelling. Would the Member then suggest that all use the word "serviette" should be struck from the English language because of its origin in the French language? Of course this would be ludicrous.
Any student of language will know that as time evolves, so does a language. "Nova Scotia" was incorporated as the English appellation of the Province of Nova Scotia at the time of its introduction into Confederation. The Member will agree full well that it must, of need, have a French translation for those of us who have seen official documents translated since that time.
I do not want to speak for very long on this issue, Mr. Speaker, because I too am excited about the prospect of the Government's coming to a vote on this issue. For those Members from the Province of Quebec who were elected in great numbers to represent the Progressive Conservative philosophy in the Province of Quebec, as well as for other francophones hors Quebec, it must be an absolute embarrassment to see that two weeks into the discussion of private Member's Bills, at a time when Nova Scotia is facing extremely high unemployment rates and difficult economic times as well as a ferry shutdown perpetrated by the Government, the Member for Annapolis Valley-FIants (Mr. Nowlan) can find nothing of greater urgent and pressing public importance to discuss than a private Member's Bill which was roundly defeated back in 1981.
It seems to me, Mr. Speaker, that the people of the House of Commons have spoken. I hope that we will have an opportunity today to hear from the Members on the Government side of the House who will see fit to allow this issue to come to a vote. I am convinced that this particular proposed piece of legislation must be as embarrassing to the government members as it is to those of us who have our roots in Cape Breton and recognize that Nova Scotia has been incorporated into the English language as the name of a province of which every Cape Bretoner, Nova Scotian and Canadian can be proud. It is a province with a strong francophone and Acadian heritage which would certainly find this Bill to be a blot on its contribution to Confederation.


Paul Wyatt Dick: Mr. Speaker, I would hate to disappoint a couple of the speakers on the opposition side of the House who have recently joined us here in the House of Commons from the provincial Legislature, but there is a distinct possibility that sometimes Bills do not come to a vote in private Member's hour.


Sheila Maureen Copps: Because you don't want them to.


Jean-Robert Gauthier: We are ready.


Paul Wyatt Dick: I have not seen very many do that.


Sheila Maureen Copps: We are ready.


Paul Wyatt Dick: That is fine. You can be ready all you want to. I did not say that I was ready. There may be some other Members who are not ready. In this place we have the privilege of speaking our minds. I happen to think that the Hon. Member for Annapolis Valley-Hants (Mr. Nowlan) did a wonderful job in introducing this Bill. I think it shows the freedom a person has to speak his mind and express a point of view. I do not think we have to be locked into the narrow version we heard from a couple of speakers from the official opposition Party who are perhaps titillated by the idea that there may be a vote which they think is going to split the government Party. I hope that there will be votes on days to come when government members will be allowed to express their opinions on both sides.


Jean-Robert Gauthier: Never.


Paul Wyatt Dick: The Hon. Member for Ottawa-Vanier (Mr. Gauthier) says "never". Never is a pretty strong word. In politics I have learned that you never use the word "never".


Jean-Robert Gauthier: You just used it twice.


Paul Wyatt Dick: I just want to tell you that I will never say it.


Jean-Robert Gauthier: Never mind. Get to the point.


Paul Wyatt Dick: That is good of you. If you want any further interjections, go right ahead. I think the Hon. Member for Annapolis Valley-Hants was quite proper in bringing forth a very interesting argument. Having listened to what he had to say, I think he was very persuasive. He said that the name of Nova Scotia has a Latin origin and is a proper noun.
Then unfortunately I heard the speech made by the Hon. Member for Blainville-Deux-Montagnes (Mrs. Landry) who explained that in centuries gone by before Confederation the name appeared as Nouvelle Ecosse on a number of maps of the world. It appears that the words "Nouvelle Ecosse" have been part of our heritage before some of the items which the Hon. Member for Annapolis Valley-Hants brought up. He said that it was just in the Latin language that it was brought into our British North America Act in 1867.
We must be very sensitive. In the last 15 or 20 years this country has moved a long way toward accepting two languages from coast to coast. That has been an advancement in the country. If we are going to do anything which will derogate from that step forward, we must approach all corners of society very carefully and get their concurrence. Instead of simply having the Bill introduced in the House at this early date in the new session, a person who was serious about getting it passed may have lobbied various government ministries. Perhaps the Province of Nova Scotia itself may make a petition to the Government to have the name used only in the Latin language and not have it translated. Until that sort of lobbying has been completed, I think it would be premature to move away from the use of two official languages. I accept the argument that although Nova Scotia may have been derived from Latin, it has in fact been adopted into the English language as if it were an English word.
November 26, 1984	__________________COMMONS DEBATES__________________________________ 613
I would therefore reserve any final decision on that to see whether there is a wide scope of endorsement of the private Member's Bill. If the province itself wants this to come forward, hopefully it will endorse this. Perhaps it will pass a provincial Act and petition the federal Government. It would be interesting to see all the provincial Members sign a petition and send it to the House of Commons to be presented as a petition in the House of Commons. If some Act of that magnitude did come forward, the House of Commons would have to consider very seriously the representations being made.
As I indicated earlier, until something of that nature happens, I think we must derogate from the bilingual nature of this country, albeit improper nouns, with reticence. I would hope this matter will receive more consideration before it comes back to the House of Commons.
I do appreciate and am thankful, as I believe all Canadians are, that there is freedom of speech and of ideas in the House of Commons. Members can present their ideas in the form of a Bill which may get accepted on the first, second or third attempt, or may never get accepted. It is a right which private Members have. I hope that in the foreseeable future many private Members will take advantage of the opportunity to raise possible controversial matters. I think it is good for us.


Don Boudria: This is supposed to be relevant.


Paul Wyatt Dick: I think it is good for the House of Commons. Bill C-201 is a clear example of a Member introducing a Bill about which he undoubtedly feels strongly. It is obviously very controversial as evidenced by some of the comments from the two speakers from the Official Opposition.


Sheila Maureen Copps: It is embarrassing.


Paul Wyatt Dick: I do not find it embarrassing.


Sheila Maureen Copps: Let us vote on it, then.


Paul Wyatt Dick: If the Member is able to stick around here long enough, she might even find out how the rules work in this place. They are quite different from those in Ontario.


Mr. Parry:: Mr. Speaker, I rise on a point of order. 1 would ask and entreat you to bring the Hon. Member for Lanark-Renfrew-Carleton (Mr. Dick) to order. His speech has deteriorated entirely into vague generalities.


Mr. Speaker:: The Hon. Member obviously does not know the ruling in Beauchesne which indicates that one does not have to be anything less than vague to be relevant.


Stanley J. Hovdebo: We are even helping you out.


Paul Wyatt Dick: I appreciate that. I was rather hoping that the Hon. Member would make a longer intervention. However, seeing that he did not wish to make a longer intervention, I will have to continue with some vague generalities about the Bill, which is very interesting for our first private Members' Bill.
Designation of Nova Scotia
Since this is not a long Bill, I cannot spend much time going into its numerous clauses.
However, our country has increased its use of the two official languages so much in the last 20 years, that I believe there would have to be a wider consensus before we could proceed with something which I believe derogates from our most recent past. Perhaps this issue could be considered more fully together with the province involved. If it wishes to change its name, perhaps it could bring some evidence to the attention of the federal Government to show that it is taken very seriously by the entire population of Nova Scotia.
Although I have some time remaining, I am sure other Members would like to participate in this debate on this intriguing private Members' Bill. Therefore, I would like to give them that opportunity.


Albert Girard: Mr. Speaker, the Hon. Member proposes that the name of Nova Scotia be the official designation of that Province in both official languages. No doubt, there are practical reasons for such a proposal, the most obvious being the administrative simplicity of a single name which does not need to be translated from one language to the other.
There is also the appearance that one of our official languages, that is, French, is being slighted by the removal of the French name "Nouvelle Ecosse" which is a name that has been officially used since France ceded Acadia to the British Crown in the 18th century.
The Government, through the Official Languages Program of the Secretary of State, is making a great effort to promote the equality of the two official languages.

People are what really matters to us in the Secretary of State. To foster a legitimate national pride, we are seeking to help Canadians gain a better understanding and appreciation of Canada, its history, cultures and traditions. In fact, our activities affect almost all Canadians.
Canada is an officially bilingual country, French and English having an equal status enshrined in the Canadian Charter of Rights and Freedoms which was promulgated in 1982.
The Charter, however, does not limit the power of Parliament and the legislatures to further the progression toward equality of status or use of French and English.
The fundamental objective of the Canadian government's policy is to reinforce the equal status of French and English and to contribute to the development of the two linguistic groups in Canada. In other words, the government wishes to see the right to use either of both official languages extend to all sectors of our society and serve as a factor of identity, understanding and unity.
The implementation of this policy has been entrusted to the Department of Secretary of State which has redirected its programs and activities with a view to helping Canadians fully

November 26, 1984
Designation of Nova Scotia
realize the equal status of both official languages and enhancing the opportunities for them to live their lives fully in all areas of endeavour in either French or English. Its services, which take the form of financial or technical assistance, in some cases through the provision of human resources, are directed to the Canadian public as a whole, the communities of both official linguistic groups, the communities of other linguistic groups, the immigrants, as well as the education sector.
The Department of the Secretary of State offers its support and co-operation to voluntary organizations and to the private sector, as well as to governmental and para-government organizations which are seeking information and are anxious to take initiatives to promote the use of both official languages.
Here are the services offered by the Department of the Secretary of State: firstly, financial or technical assistance to national and regional non-profit organizations to develop programs dealing with bilingualism, linguistic exchanges, the use of translation and interpretation services during annual conferences, or to carry out a number of special projects. Secondly, technical assistance to the world of business, industry, trade and commerce. Thirdly, financial or technical assistance to other levels of government to provide or extend services in both official languages. Fourthly, financial assistance to individuals or groups initiating legal proceedings that will contribute to elucidating the purpose and meaning of constitutional provisions on official languages, including those of the Charter of Rights and Freedoms dealing with the equal status granted to the English and French languages, with the right of English-speaking communities in Quebec and Frenchspeaking communities elsewhere to have their children educated in their mother tongue.
Moreover, thanks to the skills of the Translation Bureau, the Secretary of State provides Canadians with a number of linguistic tools, of which in particular, terminological information drawn from the constantly updated computerized terminology bank which various specialized private or public organizations can obtain under certain conditions, and bilingual standardized glossaries.
The translation and interpretation services which are available only to federal departments and organizations take part in the implementation of various programs dealing with official languages and help the government of Canada to communicate effectively in all languages throughout the world.
Services are provided to French-speaking Canadians outside Quebec and to English-speaking Canadians in Quebec to encourage and help them to set up and maintain their institutions, to develop their organizations and take part in their own language in the activities of the Canadian community. They include financial assistance to voluntary organizations that are trying to promote community interests or to provide them with linguistic services; a financial contribution for the setting up of institutions and permanent services; and technical assistance
under the form of exchanges or the assignment of experts from the federal government or elsewhere to organizations and institutions in the community. As part of the multiculturalism policy adopted by the Government of Canada in 1971, the Department of the Secretary of State provides grants to support the preparation and publication of works of a historical, literary or educational nature illustrating the cultural diversity of Canadian society, and also for the translation of such works in both official languages. Grants provided for this purpose do not cover all expenses.
Another aspect of the official languages programs concerns the teaching of English or French as a second language to adult immigrants. The Department of the Secretary of State has placed special emphasis on official languages classes for immigrant women, a group in Canadian society that is particularly isolated and disadvantaged.
Since 1970, the Department of the Secretary of State has given the provinces and the territories financial assistance in providing English-speaking communities in Quebec and French-speaking communities in the other provinces and territories with the option of having their children educated in their own language at all levels in the school system.


Jean-Robert Gauthier: On a point of order, Mr. Speaker.


Mr. Speaker:: The Hon. Member for Ottawa-Vanier (Mr. Gauthier), on a point of order.


Jean-Robert Gauthier: On a point of order, Mr. Speaker. I do not mean to interrupt the Hon. Member who is reading to the House a departmental document about the programs that are available. However, Mr. Speaker, relevance is important, and I for some time now have failed to see any relevance in the Hon. Member's comments to the bill presented by the Member for Annapolis Valley-Hants (Mr. Nowlan) to change the name of his province.
Mr. Speaker, I would urge the Hon. Member, and perhaps 1 may rely on your good judgment, to comment on the Bill before the House and not to read a document. We know all about official languages. We know all about the programs. There is a committee of the House that deals with this subject. If the Hon. Member wants to read this to us in committee tomorrow morning at 9:30, that is fine, but today, I would appreciate it if the Hon. Member spoke to the Bill before the House.


Mr. Speaker:: I am reasonably certain that the Hon. Member accepts the comments made by the Hon. Member and will now explain to us very clearly the relevance of what he has been trying to put before the House. I am sure that will now happen.
November 26, 1984

[ Translation]


Albert Girard: Thank you, Mr. Speaker. It is because in New Brunswick, which is a bilingual province, we-


Jean-Robert Gauthier: The bilingual province.


Albert Girard: Thank you. Perhaps 1 could explain why it is so important for me to talk about these programs. My reason for doing so is that I am from a bilingual province, the Province of New Brunswick, where at one time people suggested that we make similar changes. And here we have a Government Department, the Department of the Secretary of State, which explains a policy and explains its services, and I think it is a good thing for Canadians to see what the Government of Canada is doing to provide Canadians with bilingual services across Canada, from British Columbia to Newfoundland. That is why I was explaining all this.
To recapitulate: Since 1970, the Department of the Secretary of State has been helping the provinces and the territories financially to provide English-speaking communities in Quebec and French-speaking communities in the other provinces and territories with the option of having their children educated in their own language at all levels in the school system.
Two other programs, fully financed by the Government of Canada, are administered by the provinces in co-operation with the Council of Education Ministers. I am referring to the bursaries for language summer courses and the official language "monitors", a program under which post-secondary students-
Mr. Speaker, I wanted to get back to . . . why I read it? Well, it is done.

The proposal before us that the term "Nova Scotia" be used exclusively is one that should be negotiated under the official languages policy. The term may be Latin. We are proud to live in a country that has kept its heritage and its tradition. Nevertheless, the term "Nova Scotia" is perceived as being English as a result of standard usage. We should like to recommend, not necessarily from a judicial or from an historical point of view but from the context of Canada having two official languages, that the name for the Atlantic Province which is designated as Nova Scotia should also be La Nouvelle-Ecosse when referred to in French.


Some Hon. Members:: Hear, hear!


Mr. Comeau:: Mr. Speaker, as the only Member from Nova Scotia-


Mr. Nowlan:: Mr. Speaker, I rise on a point of order. I did not interject as the Opposition Whip did who gave a very
Designation of Nova Scotia
interesting dissertation outlining all the services provided by the Secretary of State (Mr. MacLean), which ate up about 25 minutes of the one hour provided for the private Members' Bill. This raises the question, which obviously government members and opposition members have to discuss in their respective cauci-


Some Hon. Members:: Oh, oh!


John Patrick (Pat) Nowlan: -and cauci is the proper word-as to the place of private Members' Bills in this new Parliament.
There have been several references that this Member's Bill is for a change in name. That is totally wrong. I just want to ensure that we use the proper name.
I thought we had reached a degree of maturity in bilingualism that that canard would not always be raised especially by the migrant from Cape Breton who used that canard and spoke very interestingly. Is the main question for her and for everyone else who participated in this debate-do I understand that to be the drift and the consensus of this Chamber-that if there is a word that has a definite English name it should automatically be translated into French and vice versa?


Sheila Maureen Copps: I have a question of privilege. And this is not a point of order.


John Patrick (Pat) Nowlan: That is what I would like Members to direct their attention to, Mr. Speaker. For instance, "Mount Royal" and other names that are good in French or English.


John Edmund Parry: This is not a point of order, Mr. Speaker.


Sheila Maureen Copps: I want to speak on my own behalf-


Mr. Speaker:: It is very difficult in the middle of a point of order to hear a question of privilege. I will now rule that the Member does not have a point of order. What is the Hon. Member for Hamilton East's (Ms. Copps) question of privilege?


Sheila Maureen Copps: I have a question of privilege, Mr. Speaker. As 1 understand it, I was referred to as a transient-I think the Member changed the word transient to "migrant" Nova Scotian.


Mr. Speaker:: What is the Hon. Member's question of privilege?


Sheila Maureen Copps: My point of privilege is that 1 was not born in Nova Scotia. I was born in Hamilton, Ontario, and if the Member had listened to my speech-


Mr. Speaker:: The hour provided for the consideration of private Members' business has now expired.

Adjournment Debate



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
November 26, 1984
[Stage Direction]
A motion to adjourn the House under Standing Order 45 deemed to have been moved.
["Order. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at eleven o'clock a.m., pursuant to Standing Order 2(1).\nAt 6.20 p.m. the House adjourned.", 'Tuesday, November 27, 1984']
Mr. Speaker:: The Hon. Member for Broadview-Greenwood (Ms. McDonald).


An Hon. Member:: It is not six o'clock yet.


Mr. Speaker:: We started Private Members' Hour a minute or two early. The Hon. Member for Ottawa-Vanier (Mr. Gauthier) participated in the creation of the ruling sometime ago that produced the ruling that Private Members' Hour lasts precisely one hour and no longer. He will remember the ruling, I am sure, very well.


Jean-Robert Gauthier: Yes, Mr. Speaker.


Mr. Speaker:: The Hon. Member for Broadview-Greenwood.



Ms. Lynn McDonald (Broadview-Greenwood):: Mr. Speaker, the promises made by the Conservative Government in the course of the last election campaign in the area of arts and culture were very clear. The Government said very specifically that funding for the arts and cultural agencies would be maintained at least at present levels. They are not rich levels, but the Conservatives promised that at least there would be cost of living increases, if not a better deal for our artists.
The Conservatives said there will be full consultation with the arts and cultural community and consultation came out in every press release and every speech made on the subject. They were also very firm about the principle of an arm's length relationship with the arts and cultural agencies, that there would be no interference with decision-making within these agencies.
The Government has violated all three of these principles with the announcement of the recent cut-backs. The cut-backs are far greater than in other areas of the economy, although this is an area that has suffered from cut-backs in the past. The cut-backs are at least twice the level of the non-cultural areas. There has of course been no consultation with the arts and culture community. The arm's length relationship has been violated by the Minister saying in what areas he wants to see the cut-backs, specifically in the area of administration. We cannot disagree with the area he would choose for the cutbacks, although I wonder whether it is possible to cut back that amount of money in the area of administration.
The Minister is trying to have it both ways. When one raises the issue of cut-backs to artists and the ensuing suffering, because these are people with very poor incomes, the Minister
replies that he is trying to avoid that by having administrative cost cuts, not cost cuts to the standard of living of artists or to programs. When we ask him for specific assurance that there will not be cut-backs in real programs and that creative artists will not be suffering, he says he has to respect the jurisdiction of the arts and cultural agencies and he cannot say what they will be. Suddenly the arm's length relationship is re-established.
More seriously, the Minister announced a review of the mandate of the CBC, a major cultural area and a major area of independent programming in Canadian broadcasting. He suggested that this will be a very fundamental review of the entire mandate, purpose and activities of the CBC. It is not clear what consultations will take place.
[ Translation]
Why is the Minister in favour of budget cutbacks for cultural agencies? Is the Minister unaware of the economic situation of Canadian artists? Does he not know that a great many artists live under the threshold of poverty? Artists are the patrons of cultural life in Canada. Artists are the ones who give grants through their salaries and incomes subsidize Canadian culture, for us and for all Canadians who watch their programs, read their works, listen to their music. The Government claims that cuts have become necessary now as a result of the fat years we have been through. However, Canadian artists never did get a fair share during those years of prosperity, they never did enjoy budgets full of economic benefits. There has been no such life for artists in Canada. Cultural agencies have never been given generous amounts of money. Cuts have already been made in the area of administration because their increases have not kept up with the rise in the cost of living in recent years.

I suspect there is not much more fat to be trimmed from budgets and that cuts now will be cuts into the muscle, bones and vital organs of the cultural life of the country. We do not need budget cut-backs. We need increases. The Applebaum-Hebert Commission in most domains recommended very substantial increases to give artists the financial support they need.
Why do we need good support for our cultural life? We want to have an independent society. We have made that decision politically, socially and economically. We could have assimilated into the United States if we had wanted, but we chose not to do that. We chose to develop our own country. That was a political decision. We have to back it up with our cultural life. It costs money, and will always cost more money to develop our own programs, to publish our own books, to have our own poets and to have our own cultural life here than to import extra runs from other countries, the United States, or from other European countries such as France, Britain or wherever.
November 26, 1984

While there will be economic costs, I suggest they are important to bear because there will be economic costs from the cut-backs as well. There are good economic reasons for resisting cut-backs in cultural areas. The arts and cultural industry employ large numbers of people at good jobs. Often they are low-paying jobs, but they do valuable and interesting work which is very satisfying. The cultural industry is very important for tourism in Canada. There are areas where it is the attraction of the theatre or music festivals which brings in the tourists. There are estimates that for every dollar invested in museums, $4 come back in expenditures on the part of tourists for goods and services in the area. There are good economic reasons for saying no to cut-backs.
However, I would want to make the case on the basis of the political, cultural and social life we want for Canada. We have artists of whom we can be proud. They deserve our support. More important, we need them more than they need us. We need to have an independent country-


The Acting Speaker (Mr. Paproski):: I am sorry. I now recognize the Hon. Parliamentary Secretary to the Minister of Communications (Mr. Scott (Hamilton-Wentworth)).


Mr. Geoff Scott (Parliamentary Secretary to Minister of Communications):: Mr. Speaker, before dealing with the most important matter raised by the Hon. Member for Broadview-Greenwood (Ms. McDonald), may I say how delighted I am to be working once again with the hon. lady in this significant field of Canada's national identity. The Hon. Member and I have shared similar views on many committees in the past, and I must say that when it comes to the dignity, preservation and viability of the Canadian cultural community, we are in agreement again.
As has previously been noted in the House by the Minister of Communications (Mr. Masse), the Government believes that the impact of any budget restraint measures on individual artists and arts organizations can be greatly minimized by the Canada Council and the National Arts Centre through reductions in administrative costs and non-essential services. We have no doubt that this task will challenge the wisdom and determination of the agencies concerned. However, the current rate of growth of the national deficit makes it imperative that every possible savings in program administration and delivery be made by government Departments and agencies.
These decisions will, quite naturally, demand a fundamental re-examination of the roles, objectives and activities of the Government of Canada in support of the arts. The Government is committed to undertaking such a review. The Government's objective in this review will be to ensure that the public resources devoted to support of artistic expression are employed in the most effective manner possible and that budgetary restrictions do not jeopardize the federal Government's investment in the cultural development of the nation.
Adjournment Debate
With specific reference to the CBC, the Minister has emphasized that he expects the cut-backs to be made primarily in administrative areas and not affect Canadian producers and artists whose development the Government intends to encourage. According to the Minister, real change at the CBC must be based on the creation of an environment that will make it easier for creators, artists and producers to work and to develop. The objective is to ensure that the public resources now committed are being used as effectively as possible to contribute to Canadian cultural development. To this end, the Minister has hired three consultants to advise him on the budgetary cut-backs proposed by the CBC. Regarding consultations, the Minister specified that they will take place with due regard for the respective responsibilities of the Ministry of Communications and the Canadian Broadcasting Corporation and will not infringe on their respective mandates.
With respect to the Canada Council and the National Arts Centre, the budget reductions were $3.5 million and $1 million respectively. In the case of the Canada Council, this represents 4.8 per cent of the current parliamentary apppropriation of approximately $72.5 million and 4.2 per cent of the council's total operating budget which totals almost $84 million. The council's total operating budget-


The Acting Speaker (Mr. Paproski):: 1 am sorry, but the Hon. Member's time has expired.


THE CENSUS-JUSTIFICATION FOR CANCELLATION OF 1986 CENSUS. (B) REQUEST THAT CANCELLATION BE RESCINDED
Don Boudria: Mr. Speaker, I rise to bring to the attention of the House the entire matter of the census and the reply that the Minister gave to me on Wednesday of last week regarding the cancellation of the 1986 Census. I must tell you, Mr. Speaker, that the answers I have received thus far are most unsatisfactory, as 1 am sure you will agree.
The 1986 Census of this country cannot be totally cancelled since there are obligations under the Alberta Act, under the Saskatchewan Act and perhaps under other provincial legislation preventing the cancellation of the 1986 Census. Of course, you will know, Mr. Speaker, that the Alberta Act and the Saskatchewan Act now form part of the Constitution of our country. Therefore, there is a constitutional obligation to continue with the census, and the Government recognized that when it made its announcement a few weeks ago. However, in reply to a question that I put last week, the Minister answered the following, and I am sure that you will recall it vividly, Mr. Speaker.

As to whether Statistics Canada will provide the data required by the various departments to make sound decisions about the problems mentioned by the Hon. Member, I can assure him that Statistics Canada will indeed be in a position to gather this data. They have every technical resource at their disposal and can rely on very competent professional staff. But,

November 26, 1984
Adjournment Debate
Mr. Speaker, we are not here today to question the competence of Statistics Canada personnel, we know of course that they are quite competent. It is the competence of the Minister who gave that kind of answer which prompts me to raise the question today.
Mr. Speaker, I draw your attention to page 7 of a document entitled "Working Paper, Plans for the 1986 Census" published by Statistics Canada in August 1983. Here is provision 13 of this document:
As indicated earlier, as a result of a Cabinet directive. Statistics Canada has considered the possibility of using administrative and investigative resources instead of census data for 1986.
Here is the significant part, Mr. Speaker:
The conclusion was that it is impossible and that there is no other solution for the 1986 census.
So you can see the obvious contradiction between the answer the Minister gave me recently when he said that there were other sources of information to prepare affirmative action programs, other sources of information to do all the rest of the work related to the five-year census, when it is definitively not so, at least not according to Statistics Canada the very agency which the Minister claims told him it was possible. How was it possible for Statistics Canada to have set up a whole new administrative structure, to have developed an entirely new approach, an entirely new course of action, and an entirely new mechanism to gather information since their report of August 1983? That is what matters and that is what the Minister's parliamentary secretary should address today. It is unfortunate that the Minister was unable to be in the House and set the record straight himself since he misled the House. I am sure it was not intentional, but in any case, Mr. Speaker, the Minister himself ought to set everything straight.
Mr. Speaker, I draw your attention to a letter I received from the Social Science Federation of Canada. I quote the concluding statement of the letter:
The scholarly community fears that the Government may have sacrificed an irreplaceable national resource for a short-term gain which may never materialize. We hope, therefore, you will reconsider your intention to cancel the 1986 census.
This is an example where academics, social groups, the Opposition Parties in this House, and big business are in agreement. I have never seen another incident in which all of those groups were in agreement. Everyone is of the opinion that it is imperative that the 1986 Census should proceed, including Statistics Canada, in spite of what the Minister has told us.
It is important for the Parliamentary Secretary or the Minister to inform the House that the Government has changed its mind, that the previous scheme will be withdrawn, and that it will immediately implement the 1986 Census. The plans for that census were complete. I have a copy of the Order-in-Council which was signed by the Clerk of the Privy
Council. That is evidence that the Government was ready to proceed with the census.
Much, if not all of the work has already been done. The only thing left to be done is to place the people who will collect the information which will be used to provide the necessary programs which must be established.


Mr. Bud Bradley (Parliamentary Secretary to Minister of Supply and Services):: Mr. Speaker, it is indeed a privilege to be able to respond to the Hon. Member on behalf of the Minister, as well as on behalf of the Prime Minister (Mr. Mulroney) who he questioned the other day.
First, let me reiterate that all decisions of the Government announced in the Minister of Finance's (Mr. Wilson) Economic Statement were taken in light of the Government's determination to take action to control the federal deficit. Many programs were reduced or eliminated. They are indeed socially valuable, but are not fully cost-beneficial in view of the financial position of the federal Government.
Second, let me again make it clear that this Government recognizes fully the requirement for comprehensive and reliable statistical information to run the affairs of the nation. We are committed to meeting those information needs, and we support the mandate of Statistics Canada to meet those goals. Moreover, we have full confidence in the management and professionalism of Statistics Canada to fulfil that mandate.
The issue regarding the previously authorized 1986 Census is not the value of the information or the competence of Statistics Canada, but rather the cost effectiveness of the program as authorized by the previous Government.
Coincident with the Government's decision, the Minister has directed the Chief Statistician to re-examine user needs and develop options for more cost beneficial alternatives to the previously approved 1986 Census. This re-examination of priority needs and development of lower cost alternatives is vigorously underway, aided by the substantial number of reactions and representations which have been volunteered by various organizations and respected professionals. This Government has pledged itself to full consultation in its decisionmaking process, and I can assure you that that pledge certainly applies to the information development responsibilities of Statistics Canada.
It is too soon, and this is not the proper forum for a report on possible alternatives to the previously authorized 1986 Census. Suffice to say at this time that there are various possible approaches which would improve cost benefit and cost effectiveness. Those approaches may lead to a somewhat reduced information availability, but that would be justified by corresponding cost savings in view of the essential need for control of government expenditures.
In summary, we fully recognize and support the requirement for accurate and objective statistical information. We believe the priority information which the previously authorized 1986 Census would have produced can be obtained by more cost
November 26, 1984

beneficial approaches. We are expecting from Statistics Canada in the near future a report on more cost effective alternatives to the previously approved 1986 Census.


AGRICULTURE-FLOOD DAMAGE COMPENSATION FOR FARMERS IN NORTHEASTERN SASKATCHEWAN. (B) REQUEST FOR IMMEDIATE PAYMENT
Maurice Brydon Foster: Mr. Speaker, on November 13 I asked the Minister of Agriculture (Mr. Wise) when the Government was going to get on with the payment of flood compensation for five rural municipalities in northeastern Saskatchewan. This question arose because this Government has not filled a commitment made by the previous Government. During the summer months the Prime Minister (Mr. Mulroney) made a commitment that some $16 million would be paid for flood damage to about 1,700 agricultural producers in the northeastern part of Saskatchewan. This was based on the province putting up $8 million and the federal Government putting up $16 million. When I put the question to the Minister of Agriculture on November 13 he indicated that the matter was before the Treasury Board and that he was not sure whether or not it had been approved. I checked with the Treasury Board a few days before putting the question to the Minister and I was told that indeed the funding had been approved in mid-August but was being held up for a further review by the new Government.
The background of this matter is a devastating two years for some 1,700 producers in those five rural municipalities in which serious flood damage was suffered. There was a commitment by the two levels of Government in the early part of the summer. The Province of Saskatchewan came through on its part of the bargain. The cheques went out, I understand, in July. We are now waiting on the federal Government to come good on its funding.
The day after I put the question to the Minister, he indicated to me that he understood that some $7 million was going to be approved. He suggested that I check the details of that. We have checked further with his office and it was indicated that in fact the matter went to Treasury Board last Thursday, but the funding has still not been approved.
There is considerable urgency for those producers in that part of Saskatchewan. The deadline is November 30, just four days from now, when they have to make a commitment as to cash advance payments. Some producers are waiting to find out whether the Government is going to come good on this commitment. I am sure the Parliamentary Secretary wants to be helpful this evening, and perhaps he will indicate that the Government is going to honour its commitment and approve the funding. I hope the Government will move on that before November 30 for the benefit of these producers who have to signify by that date their acceptance of cash advance payments on farm stored gain.
Adjournment Debate
It certainly appears that the Government is procrastinating on this decision. The early indications are that the Government will either not make any payment at all, or at best make a payment of some $7 million, half the amount the previous government authorized and the Prime Minister announced early this summer, and which Treasury Board approved in mid-August. I certainly hope, for the sake of these producers who have been waiting now for several months, that the Parliamentary Secretary will not further embarrass the Government by not making a decision tonight. I hope he will announce that the Government is going to come good on its commitment, just as the Saskatchewan Government did, so that these payments for flood damage can go out within a very short period of time. They are urgently needed by those producers in northeastern Saskatchewan.


Mr. Pierre Blais (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, the Hon. Member for Algoma (Mr. Foster) could probably have asked his question to the Hon. Member for Shawinigan since he volunteered the information with a sly smile that the cupboard was indeed bare when his party was defeated last September 4. This partly explains the answer to his question.
The week before the election, Mr. Speaker, more specifically on August 29th, the previous Government announced assistance payments of $20 an acre would be made to farmers in north-easthern Saskatchewan in view of the losses they had incurred as a result of floodings the two previous years.

The payment was to be based on the provincial Government's program criteria, but the federal payment was to be twice as great per acre as the provinces. Immediately following the election the federal Government initiated a general review of discretionary spending, including the assistance program for northeastern Saskatchewan.
[ Translation]
As everyone knows, this review proved to be necessary so that the new Government would be better informed about financial commitments for the present fiscal year and could take action to reduce the deficit, and especially to stabilize it.
The review of this specific program is not yet completed, but I hope that a decision will be made in the near future. We are conducting an objective review of this program, but we cannot view it separately from other requests for assistance. I can assure you, Mr. Speaker, that they are numerous and come from everywhere.
I wish to emphasize that the Minister is aware of the nature and extent of the problem in northeastern Saskatchewan as

November 26, 1984
Adjournment Debate
well as in the adjacent areas in Manitoba. Indeed, the Minister has discussed the situation with his provincial counterparts and also with his Cabinet and caucus colleagues.
We share the concerns of the farmers who have suffered heavy losses over the last few years and we shall certainly take their concerns into account when reviewing the program. The Minister will make another statement on the subject as soon as these programs have been fully examined.


The Acting Speaker (Mr. Paproski):: Order. The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at eleven o'clock a.m., pursuant to Standing Order 2(1).
At 6.20 p.m. the House adjourned.

Tuesday, November 27, 1984