1984-06-07

Mr. George Baker (Gander-Twillingate):: Mr. Speaker, if the House gives its consent, I intend to table the second report of the Standing Committee on Fisheries and Forestry.


Mr. Hnatyshyn:: Mr. Speaker, there have been consultations with respect to the adjustment of our agenda for today for the purpose of tabling this report. We are, of course, agreed to that unanimous consent going forward.


Mr. Blackburn:: Mr. Speaker, we give our consent as well to concur in the report.


Mr. Speaker:: By unanimous consent, the Hon. Member has leave of the House to table the report.


George Baker: Mr. Speaker, I have the honour to present the second report of the Standing Committee on Fisheries and Forestry, which is the first report of the Sub-Committee on Acid Rain.
[Editor's Note: For above report, see today's Votes and Proceedings.]


MESSAGE FROM THE SENATE
Mr. Speaker:: I have the honour to inform the House that a message has been received from the Senate informing the House that the Senate has passed Bill S-14, an Act to implement a convention between Canada and the United States with respect to taxes on income and on capital, to which the concurrence of the House is desired.



GOVERNMENT ORDERS


Hon. Roy MacLaren (Minister of State (Finance)) moved: that Bill C-36, an Act to amend the Interest Act, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
He said: Mr. Speaker, Bill C-36, an Act to amend the Interest Act, arises from February's Budget. Members may recall that the Budget outlined a number of proposals to improve the security of home owners. In fact, two Bills now before the House are in response to that initiative. Bill C-37, which we approved in principle yesterday, amends the National Housing Act to provide for the introduction of the Mortgage Rate Protection Program while Bill C-36 proposes amendments to the Interest Act.
One of the key elements in the Government's housing initiatives is these proposed amendments to the Interest Act. Those amendments will, first, strengthen the rights of mortgage borrowers by providing consumers with better disclosure of the terms of their mortgages. The amendments will also establish a statutory right for borrowers to prepay their mortgages with maximum penalties that strike a balance between the needs of both borrowers and lenders. Second, the amendments will increase the flexibility of the mortgage market. Third, they will provide a broader choice of mortgage instruments by permitting the development of new mortgage instruments.
Canadians have experienced a period of high and volatile mortgage rates. Conventional mortgage rates rose from just over 13 per cent in early 1980 to a peak approaching 22 per cent in the latter half of 1981. Since then, rates have returned to more traditional levels. In adapting to that unusual environment, available evidence suggests that the majority of borrowers renewed their mortgages for terms of less than two years or chose to take variable rate mortgages. We hope, however, that those experiences are now well behind us.
The steep decline in interest rates led many borrowers who had renewed their mortgages at high rates for longer terms to seek assistance from the Government in having their interest rates reduced. The Minister of Finance (Mr. Lalonde) and the Minister of Consumer and Corporate Affairs (Mrs. Erola) have also received numerous complaints about the level of prepayment penalties that some lenders have demanded from consumers who wish to renegotiate or prepay existing high-

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rate mortgages. Some lenders have shown an unwillingness to allow any prepayment.
The Government is sympathetic to the plight of those who have experienced difficulty in often trying circumstances. As Members know, the Government has demonstrated that it is prepared to take exceptional action in exceptional circumstances. It has introduced a number of measures to assist borrowers who are hardest hit and least able to cope. A joint government and industry task force was established to ensure the problems were identified as quickly as possible and dealt with in a flexible and responsive way. The co-operation of mortgage lenders in responding to problems in a flexible manner was essential and was forthcoming in most instances. Also the Canada Mortgage Renewal Plan has provided assistance to over 21,000 home owners.
The proposed amendments to the Interest Act now before us are one prong in the Government's efforts to improve home owner security. These proposals represent a comprehensive and balanced approach to this important problem and will minimize the risk of Canadians once again finding themselves in similar situations to those of recent years.
I should now like to discuss the proposed amendment contained in Bill C-36 in rather more detail. One comment that has been expressed on numerous occasions in letters and in other representations to the federal Government concerns the lack of information and understanding that borrowers had about the terms of the conditions of their mortgages. Bill C-36 proposes that mortgages be divided henceforth into two categories: first, mortgages over the prescribed amount of $150,000; second, mortgages equal to or less than $150,000. Mortgages in the second category, which encompass the vast majority of residential mortgages, will be subject to comprehensive disclosure requirements that will provide consumers with essential information on the terms and conditions of their mortgages, including prepayment rights and privileges. Lenders will have to fulfil these disclosure requirements when the mortgage is initiated and upon subsequent renewals. To permit "comparison shopping", lenders will be encouraged to disclose this information in advance.
The Interest Act requires that mortgage lenders disclose the rate of interest calculated yearly or half-yearly, not in advance. There is little disagreement among consumer groups, financial institutions and the public at large that most individuals do not understand this method of disclosing interest rates and cannot compare mortgage rates to other consumer loan rates. Lending institutions have suggested that the method of disclosing mortgage rates be modernized to reflect current lending techniques as practised in consumer and commercial lending. The lending institutions have suggested that mortgage rates be disclosed as an annual percentage, as is done in the United States.
The main reservations that have been expressed about adopting a new method of disclosing mortgage rates focus on the potential for a one-time disguised increase in mortgage
rates that could result from incorrect rounding of interest rates. In particular, while the Consumer's Association of Canada is generally supportive of modernizing the method of disclosing interest rates, concerns have been expressed about the rounding problem. As a result I suggest that the method of disclosing mortgage rates be examined at the committee stage of this Bill.
The proposed amendment in the Bill now before us attempts to balance the various facets of the mortgage market to ensure its continuing flexibility and responsiveness to the needs of borrowers and lenders. In this regard, the adoption of simple solutions could do more harm than good, making matters worse.
At various times there have been calls on the Government to set the prepayment penalty for all mortgages equal to three months' interest. While this proposal would allow borrowers to be relieved of their high mortgage obligations at relatively low cost, it remains a simplistic solution to a complex issue and can indeed do harm to the total mortgage market.
The adoption of this type of penalty in the majority of cases does not provide an appropriate balance of risks between lenders and borrowers, as it would interfere with the ability of financial institutions to match their assets and liabilities. Especially during periods of volatile interest rates, distortions in the mortgage market will occur. It is expected that all borrowers would find themselves more exposed to volatile interest rates and with fewer options available. This could both increase their costs and reduce their security by precluding the ability to lock in mortgage payments for reasonably long periods.
In recent years there has been considerable confusion in the minds of consumers about their prepayment privileges under the Interest Act. While the public's perception at times has been that a three-month interest prepayment penalty for longer-term mortgages is available on all mortgages, in reality mortgage contracts have a variety of prepayment penalties. Some contracts are silent on the subject and in those circumstances penalties are at the lender's discretion.
As I have already noted, some borrowers have complained about the level of proposed prepayment penalties and their ability to prepay the mortgage under any circumstances. The amendments contained in Bill C-36 propose that for mortgages of $150,000 or less borrowers have the right to prepay their mortgages upon the payment of the principal outstanding, any accrued interest and the prepayment charge. The method of calculating the maximum prepayment charge that a lender can impose is set out in the legislation. However, borrowers will not be prevented from negotiating more favourable prepayment conditions. It should be noted that the value of the prepayment charges will depend on a number of variables, including the outstanding principal, the amortization period, the decline in interest rates and the time remaining to the end of the term of the mortgage.
The basic principles underlying the proposed prepayment formula are that it should be a reasonable balance of the
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interest of both parties and that it should not interfere with the vitality of the mortgage market. When mortgages are prepaid, lenders must relinquish their claims on existing mortgages and replace them with other mortgages. If current mortgage rates are lower than the contract rates, then lenders could experience losses. Accordingly the prepayment formula provides compensation to lenders for the losses incurred due to the prepayment and will thereby ensure a continuing supply of funds to the mortgage market. The proposed maximum for the prepayment penalty will be the present value of the difference, over the balance of the mortgage term, between the interest stream at the rate provided for in the mortgage being repaid and the currently prevailing market interest rate for mortgages of the same term. For partial prepayments, the charge shall be proportional to the amount of principal being prepaid.
In the event that interest rates remain unchanged or increase, there would be no prepayment charge. Due to the wide ranging debate and until recently the unspecified nature of the maximum prepayment penalty, some lenders have been inserting clauses into their mortgages and renewal agreements that require the borrower to waive his or her rights to future prepayment privileges. Bill C-36 proposes that borrowers cannot waive their statutory rights to disclosure or prepayment privileges.
Section 10 of the Interest Act provides borrowers with the right to prepay mortgages which have been in effect more than five years upon the payment of a penalty equal to three months' interest. The existence of Section 10 has contributed to the disappearance of long-term mortgages because lenders view it as an unequal distribution of risks between borrowers and lenders. There have been periodic requests for government action to encourage the development of a long-term mortgage market, and, accordingly, the Government is proposing initiatives to this end. As one step, Section 10 will be repealed to eliminate this legislative barrier to the development of very long-term mortgages and to make uniform the prepayment penalties for residential mortgages. The repeal of Section 10 would not apply retroactively to existing mortgages. No existing mortgage borrowers will be adversely affected by this change.
The repeal of Section 10, combined with the proposed present value prepayment penalty rules, is necessary if the longer-term mortgage market is to be revived. The new prepayment formula will help to ensure that mortgage funds are available to meet the market demand, while the repeal of Section 10 will remove an important barrier to longer-term mortgages.
The flexibility of the mortgage market can be improved by increasing the number of alternative mortgage instruments that are available to consumers. Variable rate mortgages have been available for a number of years and naturally gained in popularity during the recent period of high and volatile mortgage rates. While variable rate mortgages are available, lend-
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ers have expressed some concerns about their legality with respect to the Interest Act. Bill C-36 proposes to clarify the legal status of variable rates in mortgages. Because the borrower, rather than the lender, bears the risk of interest rates changing, there would be no penalty for the prepayment of a variable rate mortgage.
Index-linked mortgages are another mortgage design that could add to the flexibility of the total mortgage market. While index-linked mortgages can be useful in certain circumstances, they are not appropriate for all borrowers. While not promoting this instrument, the Government is amending the Interest Act to permit their development if market forces dictate.
Bill C-36 proposes that the amendments apply to new mortgages on a date set by proclamation. The proposed amendments will not be applied retroactively to existing mortgages, but those mortgages will become subject to the amendments as they are renewed.
The February Budget asked lending institutions to adhere to the spirit of the proposed amendments. Many institutions have done so. We hope that they will continue to do so. Bill C-36 also contains some house-keeping amendments on judgment debts that were asked for by the provinces and will be proclaimed on a province by province basis.
At the time of the February Budget, it was announced that federal Officials would be consulting with provincial counterparts on the proposed Interest Act amendments. Consultations were also held with a committee of financial institutions and the Consumers' Association of Canada. I am pleased to report to the House that the general response to the proposed initiatives was decidedly positive. In particular, provincial consumers' affairs officials and the Consumers' Association have generally endorsed the proposals, noting that they go a long way towards improving consumer information and protection in the mortgage field.
In conclusion, Bill C-36 is a progressive piece of legislation that deals with real consumer problems caused by a lack of information and inflexibility in mortgage arrangements. The proposed amendments will improve the flexibility, vitality and functioning of the total mortgage market. The experiences of home owners during the past few years suggest that this legislation is urgently needed. I hope that this Bill can be debated quickly and sent to committee. The positive response that the proposed amendments have received from all interested parties would indicate widespread public support for Bill C-36. I trust the House will approve the Bill before the end of this current session.


Mr. Don Blenkarn (Mississauga South):: Mr. Speaker, we have just heard a speech by the Minister of State for Finance (Mr. MacLaren) who knows absolutely, completely and totally nothing about the mortgage industry other than what he has been told by his friends is the big trust companies, the big insurance companies and the big banks. It reminds me of the fact that he has now set up a task force which is examining the powers of the big insurance companies, the big banks and the

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big financial lenders. He does not want to consult with the public. He gets this information from the foxes and then designs a henhouse for the foxes. The people of the country will be hurt dramatically by this legislation.
May I point out, Sir, that Section 10 of the Interest Act provides that no mortgage held by an individual can be held for longer than five years and the individual can escape his obligations under the debt instrument upon payment of three months' interest by way of bonus. This particular Bill creates a situation that is absolutely disastrous to a personal borrower who is borrowing on a term that is in excess of five years.
In the Minister's press release he gives the illustration of a mortgage of $50,000 with an interest rate of 12 per cent amortized over 25 years. In the press release he has indicated that the interest rate has presumably dropped to 9 per cent and that the term of this particular mortgage has two years yet to go. He shows that the penalty to discharge that $50,000 mortgage would be $2,538.23. Three months' interest by way of bonus would be $1,500. That is his illustration.
I asked the Department of Finance to give me the true figures with respect to someone who was unfortunate enough to sign up for a mortgage at an interest rate of 18 per cent back in the days of the Government's high interest rates which are returning again. I asked what would happen if that unfortunate person wanted to pay off his mortgage because interest rates had dropped to 13 per cent. I suggest to you, Sir, that on a two-year term rather than a three-year term or a five-year term, the penalty would be excruciatingly higher than three months' interest by way of bonus; substantially higher than six months' interest by way of bonus; probably higher than one year's interest by way of bonus. This is the kind of help that the Government wants to give to home owners. Government Members ought to be ashamed of themselves. The Minister ought to be ashamed of himself. I do not know how he can come to the House and even suggest that this Bill is designed to help home owners.
Let us take a look at the Interest Act. From my preliminary investigation I have found that we have had an Interest Act dating back to at least 1840 which has contained virtually the same terms and conditions. This Bill is in almost exactly the same form as that Act. I would suggest that it is probably in the same form as that which has been in existence since July 1, 1880. The present Interest Act is at least 100 years old and is probably much older than that.
The concepts contained within the current legislation are concepts regarding dealings between parties, lenders and borrowers, on mortgages for real estate, concepts that are a part of the common law of the country. Those concepts are well understood by people throughout the country. They are not concepts that are new. They do not involve the horrendous nonsense of the present value of future payments of money. I do not know how anyone could explain to Aunt Mamie, who may be lending money on a mortgage, the present value of future payments when she is forced to discharge the mortgage
in accordance with regulations yet unpublished, yet unthought of and yet undetermined.
It is true that a vast amount of the money in mortgages on real property or real estate in the country is money that has been put up under the auspices of financial intermediaries like the trust companies, the banks, the credit unions and the insurance companies. However, I would suggest that when dealing with the numbers of mortgage documents that exist, not necessarily in total dollar amounts, private mortgages and small trust mortgages represent more mortgage documents than the number of mortgage documents held by the large financial intermediaries. The law that is before us is a law of general application. It is a law that requires the concept that the lender is in business to lend money on mortgages for real estate not only today but 100 years from now. Aunt Mamie will be dead and buried and her estate will be long wound up by that time.
This country is a vast one. It is not made up of only Etobicoke North and Mississauga South. It is a country of small towns right across the land in which retired people, small groups of people and private merchants lend money to finance their neighbours' properties. We cannot change dramatically the terms under which interest is calculated and under which the bargain is struck without some long-term public input and without some real investigation. Such changes require a full debate and full consideration by the House.
This Bill is a bad Bill because it has been scrutinized only by the big banks, the big trust companies, the big insurance companies and the big credit unions. It has not had the scrutiny of the small town lawyers, the small town credit unions, the small finance companies, the local merchants and the people who put up money and make the country grow in the small towns and villages right across Canada. This Bill will make it virtually impossible for those people to understand the kinds of privileges that Parliament would like to see given to those who lend money on the security of real estate.
If, for example, this Bill indicated that if there were three years to go on the term of a mortgage, the bonus would be six months' interest and if there were less than three years to go on the term of a mortgage, it would be three months' interest, we could understand that and we could live with that. Even Aunt Mamie and her lawyer could understand that. However, the present value of futures in a money market somehow determined somewhere by regulations here in the ivory towers of Ottawa and presumably on the top floor of Place Bell tower is the kind of nonsense that has been spewed out by the Government for the last four and a half years and the reason why the people of the country will toss it right out.
Let us deal with the question of lending money on real estate. Somewhere along the line the Government quietly snuck in a change. The Interest Act spoke of lending money on the security of real estate. There is a great deal of difference between what is real estate and what is real property. They snuck it in with that change. Therefore, if the mortgage is a first mortgage against the title to real property, presumably the Interest Act applies. If the mortgage is a mortgage on
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personalty or the equity in real property, or a mortgage against a mortgage, or a loan against a mortgage, or a loan against a mortgage on real property, it is a loan on personalty secured against real estate and the Bill will not apply. No longer will there be any protection against the hideous contracts that might be forced on the general public by the foxes that the Minister seems to support.
The Minister says that the Bill is to protect and help people. How did people get in trouble in the first place? I would refer the House to a document produced by Arthur Andersen and Company for Canada Mortgage and Housing Corporation respecting the objectives and overview of mortgage rate insurance. That was another disaster which the House dealt with yesterday. We will speak again on that when the Bill goes to committee. The document reads:
Two characteristics of a mortgage are: (i) the length of the period upon which the monthly payments are based; and (ii) the period during which the mortgage interest rate is fixed. When mortgages were initially introduced, and for a long period thereafter, the interest rate on the loan was fixed over the life of the mortgage. The borrower was secure in that his monthly payments were known and fixed during the entire period. The lender had either been able to borrow funds for a period that matched the life of the mortgage or was fairly certain that any changes in funding costs would be nominal. In essence, as long as interest rates remained relatively constant, lenders were prepared to offer fixed rates for the life of the mortgage.
When was that? Arthur Andersen says that it was prior to the 1970s. It was only in the 1970s that it became difficult under the present Interest Act to get a mortgage that extended beyond five years. Why? Because the governments of the day operated the country so that interest rates were relatively level. There were no massive gyrations in interest rates. The country was managed sensibly, honestly and carefully.
We are now told that that condition cannot return. Somehow we will never be able to get to a point where lenders will lend for 10 years, 20 years or 25 years as they once did. We will have to put up with variable rate mortgages, or indexed mortgages or mortgages that somehow run for short periods of time.
This country does not need to put up with that kind of mismanagement. This country should have an election soon to allow Canadians to get a set of managers who will manage the country so that interest rates will not go the way interest rates have gone during the past decade.
What is the concern? It is that because financial intermediaries want to finance with short-term money. They want to protect themselves when they lend long term, they want to ensure that they can have matching in terms of their receipt of deposits and in terms of their payment out of interest to depositors. Those people want matching and they could have matching if we had a sense of stability in the country. But rather than attempt to create a sense of stability, we had yesterday a Bill to ensure high interest rates, and today a Bill to ensure that those who borrow from mortgage companies will pay, if they want to get out of their contract, the present value of future money. This is again to ensure high interest rates and
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to insure against the effect of instability. There is no need for that.
We are faced with what has often been referred to as Hardin's Law. It says that once there is a bad law, to correct the effects of that law, three more laws must be passed to correct that situation.


An Hon. Member:: Which are equally as bad.


Donald Alex Blenkarn: As my friend says "equally as bad". Of course, it implies that we must have three times three more laws, nine bad laws to cover the three bad laws which were passed to clean up the first bad law.
Let us go back to basic principles. The Interest Act has been with us for well over 100 years. It represents the basic contract that has proven itself to be a sound contract on which those who lend money and those who borrow money know where they stand. Section 10 of the Interest Act is designed to prevent lenders from tying up borrowers for longer than five years. In other words, it would give borrowers an out at the end of five years upon three months' interest to pay off the lender's claim. There has been no problem with that. That did not prevent long-term loans. But it did prevent someone gouging, harming or injuring a borrower. It was and is a form of consumer protection which we understand, know, are used. There is no need for any change in that condition.
This Bill is before us today because of the situation which developed as a result of the Government's high interest rate policy and its national energy policy which attempted to Canadianize every oil company in the world. The lack of confidence which this Government has inspired throughout the world in our economy, through the NEP and through the crude application by the Government of the Foreign Investment Review Act caused the need to keep interest rates in Canada about 6 per cent higher than those in the United States, from August 1981 to June 1982.
We are now faced with the same type of problem. We are faced with a falling dollar. Because Canada is deemed not to be a sound risk and in order to ensure that people will lend to Canada, more interest has to be paid in Canada than anywhere else to get money into Canada. That was the condition then which led people to talk about finding some way of allowing borrowers to get off the hook on mortgages.
The problem of 18 per cent and 20 per cent mortgages when interest rates fall to 12 per cent and 13 per cent arises from the fall-out of the National Energy Program, the Budget of November, 1981, of FIRA and the inept management of the economy that led to the fleeing of capital from the country. That condition can and will be changed, but to change the basic lending laws because of a government is the wrong thing to do; we must change the government.
Throughout late 1982 and 1983 people were forced to take mortgages at 18 per cent and 20 per cent. They then found they could not sell their homes with these kinds of mortgages,

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particularly when mortgage money was available at 12 per cent to 14 per cent, so they wanted to pay off these high mortgages and refinance at a lower rate. The mortgage company had borrowed the money at the higher rate, but they said: "If you will pay our costs, we will let you off." All this Bill does is to try and institutionalize that condition; it does nothing for anyone. The penalties authorized in this Bill are so horrendous that it makes the three months' or six months' interest penalty these people would probably have to pay look pretty cheap. What is offered here is ridiculously expensive and very hard on people.
It was not as if borrowers did not know what they signed for; they knew they were tied to their mortgage contract for five years. It was the penalties they had to pay to get out of their contract that created the problem the Government is trying to react to. But it is not reacting to the problem, it is only institutionalizing a settlement which many companies made, not a very fair settlement as far as their borrowers were concerned. Our view is that there should have been a broadening of Section 10 of the Interest Act to cover more people, and make sure that the existing three months' penalty applied in more situations.
Representations were made by some of the leading companies which are now the friends of the Minister. They suggested that borrowers at 18 per cent to 20 per cent could always get out of the mortgage, even though it was a closed mortgage, with a three months' interest penalty. "That is our policy," is what some officials of Canada Trust said. But rather than go after the trust companies and the banks, rather than put the heat on, as the Minister of Finance (Mr. Lalonde) could easily have done, and force them to comply with what they said they would do, the Government let the large institutions get away with those misrepresentations. Rather than insist that the companies comply with the representations they made and solve the problem, the Government has come in with this statute which is really designed to make sure that the large institutions can somehow reap their pound of flesh.


Mr. Malone:: Forever.


Donald Alex Blenkarn: They will never be stuck again. That is a poor response to the problem.
I now want to deal with the portions of the Bill which attempt to deal with disclosure. In my province of Ontario, some 15 years ago we passed a Mortgage Brokers Arrangements Act and made the provision that mortgage brokers, lenders, had to make full and proper disclosure to the borrower. They had to be licensed, and if there were fees involved there was to be full disclosure. The disclosure form sets out the amount of money owing on the mortgage at maturity. I am told that is now the case in most provinces. Then, all of a sudden, the Ministry of Consumer and Corporate Affairs in Ottawa finds disclosure to be an important constituent matter. Well, it has always been an important constituent matter. The existing Act requires disclosure of the interest rate; it requires that the mortgage be calculated half yearly, not in advance, and there is all sorts of case law which indicates what that
means. Indeed, the lenders have published tables which indicate how much principal and interest are included in a blended payment over a period of time, calculations going to the tenth decimal point. This matter of disclosure has been covered for a long time, and it is not necessary that we in this House legislate that kind of disclosure. It is already available and working well in the provinces.
What are we going to do, ask everyone who lends money on mortgages to fill out not only the provincial forms but federal forms as well? What kind of bureaucracy are we trying to create? There is absolutely no need for the disclosure provisions proposed by the Minister in the material sent out to Members of Parliament and members of the press. Indeed, the proposals set out are poor in comparison to the existing provisions in the Province of Ontario. Therefore, why create additional paper work? You must remember that when a lender has to comply with more and more red tape, he must be paid for doing so. In other words, all his costs are paid for by borrowers, not by the Government. The money does not come from the Minister's generosity, it comes out of the pockets of borrowers. To add unnecessary red tape to the lending of money implies greater payments for the borrowers of money. There is no justification whatsoever for these provisions in the Bill.
I spoke earlier about the future value of present money being the concept on which the discharge of a mortgage prior to its maturity would be worked out. I suggest that Clause 11.2(1) (a) is unconstitutional because it affects property and civil rights by implying that by regulation the Government is somehow allowed to reduce the principal amount of money on a mortgage. That is interesting. Aunt Mamie has lent you money on a mortgage. All of sudden, by regulation passed pursuant to the discharge of the mortgage, the regulation can provide that the principal money you owe can be reduced by regulation. I am afraid that will certainly be brought before the Supreme Court of Canada and will certainly be thrown out.
While the Government has power to deal with interest rates, it has no power to deal with the principal amount owing on a mortgage. The Interest Act, the Mortgages Act and all of the other statutes do provide that no interest may be chargeable or that interest may be reduced to 5 per cent under certain conditions. But nowhere in statute law has the federal Government the power to indicate that the principal amount of the debt may be reduced. On that basis this proposal should be referred by the law officers of the Crown to the courts before it is passed by the House.
This Bill essentially guts the entire Interest Act which has been in effect since at least 1880. The last Act my researchers and I looked at was 1840. It was not quite the same but very similar. This Bill eliminates and changes Sections 4, 6, 7, 8, 9, 10 and 11 of the present Interest Act. It also dramatically changes an anachronism which has been there for a long time dealing with interest charged on judgments in western Canada.
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That shows how old this statute is. It has special provisions for the charging of interest on judgments in western Canada. They have been there since 1880. The Act has never been changed. Western Canada has since developed into provinces. It is a dramatic change in the statute.


Arnold John Malone: Colonies.


Donald Alex Blenkarn: My friend from Crowfoot says colonies. It was a colonial piece of legislation. This Bill changes that. With reference to those provinces the Interest Act will be changed. That is probably good.
I am essentially saying that this Bill abolishes the provisions with respect to the calculation of interest on mortgages. That statute is now part of the common law of Canada. It is a statute which lawyers and people generally in the country understand. It has no reference to regulations made by Orders in Council. The statute is clear, readable, understandable and interpreted by courts. In place of that statute is being put a whole new raft of social engineering. The Government says it has consulted the banks, trust companies and so on. However, it must consult the House of Commons, the people of the country, before it makes massive changes to the common law of the country.
This Bill should not be passed in a hurry. It should be thoroughly understood by every Member of Parliament. The proposed regulations ought to be tabled in the House. The calculation system which is proposed with respect to the early discharge of a mortgage ought to be clearly understood. It should be simple and capable of being understood by the simplest country lawyer, myself for instance. I see the President of the Privy Council (Mr. Pinard) here. It should be capable of being understood by him too. We have before us a measure which changes the system; that vitally affects the lending of money on real estate and how the interest is to be charged. We should not pass this Bill. This Bill is poorly thought out. It does not do what it is supposed to do. It does not really solve any social problem. It imposes greater penalties on borrowers. It is not a good statute for the general application of mortgage interest in Canada.


Mr. David Orlikow (Winnipeg North):: Mr. Speaker, I presume that the ostensible purpose of the provisions of this Bill is to try to overcome and obviate the difficulties experienced by many people who purchased homes in 1981, 1982 and 1983. When they got their mortgages they had to make arrangements to pay monthly interest rates of 18, 19, 20 and 21 per cent. A year later they found that interest rates had dropped by 6, 7 and 8 per cent. They were stuck. When they tried to do something to reduce the exorbitant monthly payments which they were finding extremely difficult to meet, they found that they could not get out without the payment of a penalty which they had never expected and, in fact, had never been led to believe they would have to pay when they discussed the situation with their bank or mortgage company.
We are going to oppose this Bill because we believe the Bill is overly complex. It is not clear from the Bill what the
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Government intends. The rhetoric of the Budget emphasized that more disclosure of mortgage interest information would be made available. We believe that the major benefits of the Bill which the Government is proposing will not be to the people who were caught in the situation where they had to agree to pay exorbitant interest rates to get their mortgage. The major beneficiaries of this Bill will be the banks and mortgage companies.
The prepayment rights and penalties sections of this Bill may sound good, but it is a nothing proposal. The Government wants to allow borrowers to have the right to prepay at any time. However, the penalty for doing so would be the full amount of interest due between the day one prepays and the day that the mortgage term expires. In other words, the person who has the mortgage would pay all the interest in any case. The Government would like to see that the borrower does not have to pay for the privilege of paying all of the interest sooner, but this represents no break to the borrower. For example, if one is locked into an 18.5 per cent mortgage of $50,000 for five years and has three years until the term expires but would like to renegotiate, the prepayment penalty would be $7,855 which represents 36 months of payments at 12.5 per cent rather than 18.5 per cent.
In the period between 1981 and 1983 I, as I suspect every other Member of Parliament, was receiving calls from constituents who found themselves in a situation where they had agreed to take a mortgage at a very high interest rate but a year later the interest rate on mortgages had come down very sharply. One could not blame them for wanting to renegotiate their mortgage so they could pay the much lower interest rate. When they went to the bank they discovered that the bank was imposing new rules and procedures. They then went to their Member of Parliament. We made representations to the banks and mortgage companies but were unsuccessful. We made representations to the Minister of Finance who told us that these matters could be cleared up by referring them to the appropriate Minister. He said he would look after it.
Some of us took all of those steps but with no results. Our constituents were stuck with these very high mortgage rates. Let me put on the record one illustration of what happened to one of my constituents. It is a good illustration because it is typical of what was happening right across the country. I will read a few sentences from the letter which was sent to me by this constituent explaining what happened. This occurred in 1982. This constituent says:
I took the mortgage out as of July 1st, 1982, at 183/4 per cent-
I asked (the manager) what would happen if the rate dropped considerably. He told me that I would be charged a three-month penalty, that they take my mortgage payments times three, and that would be the penalty to discharge my mortgage. He told me it would cost approximately $2,200-
He also told me that 1 would be saving approximately $3,000 by doing this.
This is when the person wanted to renegotiate the mortgage because the interest rates had come down by 6 per cent or 7 per cent. This constituent went to her lawyer because she was not certain that she understood everything. Her lawyer spoke

June 7, 1984
Interest Act
to the branch manager who confirmed the situation, but when they tried to pay the three-month penalty so they could get a new mortgage at the much lower rate, they were suddenly told by the local branch manager that the instruction had come from the head office that the penalty would be almost $5,000. The poor bank could not afford to do it any cheaper.
In order to make certain that I had a clear understanding of what had happened, I got in touch with the local branch manager. He confirmed what my constituent had told me. I then wrote to the head of the Toronto-Dominion Bank and outlined the situation to him. I asked him to explain why this had happened. I suggested that the bank could really show some consideration for this constituent.
Eventually, I received a reply from the Vice-President of the Toronto-Dominion Bank, William Clarkson. I will read part of his letter into the record:
The mortgage which Mr. and Mrs. Silvari contracted for in May 1982 is a standard C.M.H.C. mortgage which, in effect, provides for no prepayment other than 10 per cent of the original amount of the mortgage on each anniversary date, for the first three year term. After three years has elapsed, the mortgagor has the privilege of payment paying the full amount of the loan on payment of an amount equal to three months' interest at the contract rate.
Later he said:
Because of the large number of mortgage customers involved, it is quite simply beyond our resources to cushion the impact of high interest rates for our borrowers, nor could we do it selectively as it would be impossible to set criteria that would be fair and equitable to all. We regret that, because of the circumstances outlined, we are unable at this time to modify the amount of the payment required to renegotiate the terms of the Silvaris' mortgage.
The banks are all the same. They made over $1 billion in profits last year on which they paid very little taxes because of the very generous way in which the Liberal Government of Canada treats the banks. These poor banks, which need so much assistance, are the most powerful business organizations in the country. Not only do they control the financial services but because of their interlocking directorships they control virtually all large businesses and corporations in this country. The poor banks could do nothing for my constituent or any of the other Canadians who were caught in this very tough squeeze.
I took the Minister of Finance (Mr. Lalonde) at his word when I and other Members on this side of the House, both NDP and Conservative, appealed to him publicly in the House to do something. We were assured by the Minister that he would and could do something about it. He inferred that in some way we had not done our jobs as we should have. I am sure that Liberal Members of Parliament were getting similar complaints from their constituents and were taking them up with the Minister of Finance not publicly but privately. I am sure they were getting the same kind of assurances.
I wrote to the Minister of Finance and took him at his word that these matters could be straightened out so that those who were caught in this squeeze could get better treatment and a small modicum of justice. I sent the Minister the particulars of the case which I have just illustrated, including the correspondence from my constituent and the replies I got from the Toronto-Dominion Bank. What did I get from the Minister of
Finance? He explained that the banks, of course, had loaned people money for their mortgages and that they had reinvested the interest they received in fixed-term investments and were therefore stuck. In his letter to me, his offer of assistance to these people who were really caught in this unconsionable squeeze was as follows:
In certain cases, if a homeowner is facing financial hardship as a result of renewing his or her mortgage at high interest rates, the federal government will grant up to $3,000 under the Canada Mortgage Renewal Plan. This plan falls within the jurisdiction of the Honourable Minister responsible for Housing. If you believe that your constituents might be able to benefit from the Canada Mortgage Renewal Plan, may I suggest that they contact the Canada Mortgage and Housing Corporation-
That, of course, was of no help to my constituents. This Bill drops the present requirement on prepayment of a mortgage of five years or longer of paying a penalty of up to three months' interest. Whom does that benefit, Mr. Speaker? It does not benefit the borrower; it benefits the banks and the mortgage companies who lend the money. Section 10 of the Interest Act provides that after five years mortgages can be repaid with an interest penalty of three months. This provision is now to be eliminated, presumably so that the long-term mortgage market can be revived. I do not believe we will ever see a long-term mortgage market again. The days are gone when one could get a mortgage for 20 or 25 years at a rate which would not change over that period.
This is an interesting proposal if only because both Opposition Parties, and I am sure privately some back-bench Liberal Members of Parliament, have been calling for the standardization of the three-month interest penalty. This change is being introduced "to ensure that mortgage funds are available to meet the demand".
The Government brought forward Bill C-36 with the suggestion that it will help people buy a home and take out a mortgage in order to finance the purchase of that home. This Bill helps not the person who is buying a house, who arranges to pay for the house by getting a mortgage from a bank or a trust company; if it helps anybody, this Bill helps precisely the institutions which have used the high and fluctuating interest rates on mortgages we have had in recent years as well to gouge the person who arranges a mortgage.
Because this Bill benefits those who have instead of those who have not, because this Bill benefits the lender rather than the borrower, because it is doing exactly the reverse of what it should be doing, we intend to oppose it.


Mr. Deputy Speaker:: Order, please. The Hon. Member for Halifax West (Mr. Crosby) for debate.


Mr. Howard Crosby (Halifax West):: Mr. Speaker, Bill C-36 which is before the House to amend the Interest Act has much broader ramifications than might have been indicated by the Minister of State for Finance (Mr. MacLaren) when he was presenting the Bill to the House of Commons.
Interest rates are at the heart of the housing problem both in terms of the home owner because of the problems of
June 7, 1984

mortgage interest rates which face a home owner, and the problems of providing an adequate supply of housing since construction of housing units is affected by interest rates, these are both aspects of the equation.
Let me review very briefly the history of mortgage rates in Canada. We went through a long period, 1951 to 1972, when interest rates were below double-digit figures; that is, they were below 10 per cent. On one or two occasions, however, mortgage interest rates did rise to 10 per cent during that time. But since 1972, almost 13 years, Canadians have been faced with double-digit mortgage interest rates and people seeking to finance a home have been forced to pay 10 per cent or more. Unfortunately, at certain periods within that time frame Canadians have paid interest rates like 21.46 per cent and 19.22 per cent, the latter in 1982. Now in April, May and June, 1984 Canadians are facing mortgage interest rates rising to 14.25 per cent. There is no indication that those rates will not rise over the next six months. Hopefully they will not rise to the high which occurred in September, 1981 of 21.46 per cent.
High mortgage interest rates are the problem, Mr. Speaker. How do they affect Canadians? They affect them in very specific terms. The cost of a $90,000 mortgage at 18 per cent is $1,346 a month. Contrast that with a more reasonable mortgage interest rate of 10 per cent. On that same $90,000 mortgage, the payment would be $847 a month. This means almost $500 a month more to the person who happens to be unfortunate enough to face a mortgage rate of 18 per cent when he should be entitled to a mortgage rate more in the area of 10 per cent.
Let us now look at a mortgage of $50,000. At 18 per cent the monthly payment would be $747. That same $50,000 mortgage at 10 per cent costs $476 a month. A person pays $271 a month more at 18 per cent. Now, whether you enjoy a home carrying a $70,000 mortgage or a home carrying a $50,000 mortgage, in proportionate terms you have the same problem. A mortgage payment on a $90,000 mortgage is increased by $500 at 18 per cent and on a mortgage of $50,000 is increased by $271 at 18 per cent. You can see, Mr. Speaker, how that difference in mortgage payments at the higher level dramatically affects the budget of a Canadian family. How many Canadians are in that position? In 1983 there were approximately 5.3 million home owners in Canada, the great majority of whom had mortgages on their homes. We are talking about a tremendous number of people who are affected by this problem of mortgage rates.
It is with those people in mind that we have to approach a Bill like, Bill C-36 and examine it in that context. I want to direct my remarks in response to the Minister. The Minister mentioned as a highlight of this Bill the matter of full disclosure. That is a deception of serious proportions. Bill C-36 with respect to disclosure of mortgage provisions adds nothing to the existing law that will benefit any Canadian. In 1966 the Province of Nova Scotia enacted the first Consumer Protection Act in Canada. Other provinces followed very quickly thereafter. The thrust of those provisions in legislation like the
Interest Act
Consumer Protection Act was to require mortgagees and other lenders to disclose in exact terms the rate of interest charged and other conditions of the loan. Canadians have enjoyed the advantage of that kind of protective legislation for almost 20 years. When the Minister boasts that he is introducing in the House of Commons legislative provisions intended to protect Canadians in terms of the conditions of mortgage loans, he and his Government add nothing to the protection already provided to them under provincial legislation.
The Hon. Member for Mississauga South (Mr. Blenkarn) pointed out that the Interest Act is ancient legislation. While consumer protection legislation does not have the same antiquity, it has certainly been in force for a sufficient length of time to have established that in consumer loan transactions, including mortgage transactions, lenders are at present required to disclose in a very careful way the terms and conditions of mortgages.
I want to point out the downside of the new provisions. There may even be a disadvantage to the additional provisions which the Government proposes in Bill C-36. As has already been pointed out by the Hon. Member for Mississauga South, there is a price for these disclosure provisions and that price is paid by consumers. It can be set up any way, but the ultimate cost of all goods and services provided in Canada are paid for by Canadian consumers. Although it may appear on the surface that the lender is bearing some of the costs of the disclosure provisions, we can rest assured that those costs will be paid in the long run by consumers.
If the Minister's additional protective provisions add to the cost of the mortgage transaction by increasing the paperwork and increasing administrative services required to conform to the new law, then it will be an additional cost burden which will eventually be paid for by consumers. I caution the Minister to review that aspect of Bill C-36 and ensure that, in carrying out the pretence of additional protections and benefits for Canadian consumers in the mortgage market, the Government is not simply adding to the costs which consumers eventually will have to bear.
A second remark made by the Minister in his introductory comments was that Bill C-36 was urgently needed. I do not think anyone would argue about the seriousness of the mortgage problem in Canada in respect of Canadian home owners and those seeking to acquire homes. However, I want to point out that the Minister and his colleagues in government have a very strange attitude toward the urgency. On December 8, 1983, in the Speech from the Throne, the Government proposed a package of mortgage protection for Canadians. Again in the Budget Speech of February 15, 1984 reference was made to a package of protection for Canadian home owners faced with mortgage problems. It is only now in June, 1984 that we have come to deal with the legislation intended to implement this promise made to Canadians in December, 1983.
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June 7, 1984
Interest Act
I ask the Minister how he views this as responding to an urgent need. It took over six months to fulfil the promise made in the Speech from the Throne in December, 1983. If the Government did not know what kind of legislation it contemplated in its protective package, why did it make that promise in the Speech from the Throne? Why did it not simply say that it would consider some protective measures and bring them forward at a later date? Instead, Canadians were led to believe that they would receive immediate protection. I remind Government Members that many Canadians who are faced with mortgage renewals would look very carefully at promises of assistance and watch longingly and with a great deal of concern for these legislative remedies to be presented to Parliament. I am sure those Canadians will not be very pleased with the Government's version of immediate action in response to what it admits is an urgent situation.
Also in his remarks the Minister mentioned an industrial task force to deal with mortgage interest rates and solutions to the problems created by the Interest Act. While I agree with consultation between government and those involved in the industry, this decision on the matter of mortgage interest rates and what is a fair price for cancelling a mortgage transaction is a decision which has to be made by the Government of Canada in the interests of all Canadians. It may well be important to consult with loan companies or companies engaged in the mortgage business, but the Government has to take into account the welfare of Canadians in making that decision. It cannot rely upon representations and discussions with institutions in the mortgage industry which have, after all, a vested interest. They must put forward the interests of their own clientele and investors.
However, I remind Government Members that housing is one of the most important needs of Canadians. The availability of mortgage funds to provide housing is part and parcel of the response to that need. The Government cannot simply come up with a formula which is satisfactory to lenders and put it forward as the proper solution to the problem. The Government must consider what Canadians need in the way of housing and in the way of assistance to provide themselves with adequate housing, and make the decision on that basis. While consultation with industry is important, it does not forgive the Government for making a decision which may be consistent with the advice it receives from those in industry but is not consistent with the welfare of Canadians who are seeking to maintain their homes or those who are seeking to acquire homes. That is the test which must be applied to this legislation. Does it help Canadians in maintaining their homes? Does it assist Canadians who are seeking to acquire homes?
In that respect one must conclude that the legislation fails. Why does it fail? It fails because it introduces a complex formula or method of dealing with a very simple problem- what is the proper and fair way to discharge an existing mortgage when the debtor under the mortgage has to make the difficult decision that he or she can no longer afford to carry the mortgage and must cancel it? They are either forced to sell
their homes or to move to another place and acquire new homes.
The Hon. Member for Mississauga South has very graphically and clearly discussed this aspect of the problem. However, I want to make the plea on my own behalf that the proper method to deal with the problem of the cancellation of mortgages is a simple formula, one which is fair to the lender and fair to the mortgagor but which at the same time reflects the vital need of all Canadians for adequate housing. If there are to be errors made in the construction of that simple formula, then they have to be made on the side of home owners.
Along with the Hon. Member for Mississauga South, I propose that there be a simple penalty based upon monthly interest payments. Whatever may be selected, from one month to six months, it should be the basis for the amount charged when a mortgage debtor seeks to cancel a mortgage transaction. A fair level would be three months; that is to say, a mortgage debtor who seeks to cancel a mortgage would pay a three months' penalty. It is difficult to know whether that figure should be six or one, but three appears to be reasonable. If there is going to be any error, it should be on the side of the home owner who has no method of recovery for losses as opposed to the mortgage lender who has other methods to recoup any losses that may be suffered.
If that sounds too arbitrary and unfair, let me explain it. With mortgage penalties for cancellation of mortgage transactions, as in all other transactions involving consumers, what we have to attempt to achieve through legislation is a balance of rights. We have to balance the rights between lenders and borrowers in a fair way. As I have said, if there are going to be errors made, they should be made in favour of the borrowers rather than lenders, because in the long run that is in the interest of all Canadians. In seeking to balance those rights, the Government has the obligation to make the decision. It cannot slough off that legislation obligation on a committee composed of government, consumer and industrial representatives. It is a decision that has to be made by the Government.
It is clear in Bill C-36 that the Government has avoided taking its responsibility. In response to the consultations it has held, the Government has come up with a method that is simply a failure to make a decision. The method chosen by the Government, alleged to be flexible, is simply to enact regulations from time to time to set up the formula. That is not making a decision: it is avoiding a decision.
It is very difficult to take the legislation as a serious attempt to resolve the problems that exist under the current Interest Act with respect to the cancellation of mortgage transactions. The Government knows there is a problem. As Members have said time and time again, the problem comes up as mortgage interest rates escalate. The Government must realize that some action has to be taken. Its answer was to present a Bill which does not provide a solution. That does not provide an answer; it
June 7, 1984

merely finesses the whole problem to regulations that will be made at some future time.
Even though the Government proposed these legislative enactments seven months ago, the regulations are not available. Nobody knows what the regulations will be. Canadians are being asked to accept a pig in a poke, legislation that does not answer the question or respond to the needs. Everyone will have to wait for future developments to find out whether the effects of the legislation are fair or adverse. That is not acceptable. It is appropriate that Members of this House of Commons underline the failure of the Government to respond to this evident need. We should underline the failure of the Government to come up with a solution that Canadians can examine and then determine for themselves whether it meets the test of balancing rights between mortgage lenders and mortgage debtors. The Government is copping out, failing to make a decision. It leaves Canadians in the dark as to what the attitude is with respect to the vital matter of mortgages, mortgage interest rates and the cancellation of mortgage transactions.


Mr. Deputy Speaker:: Are there questions or comments?


Donald Alex Blenkarn: Mr. Speaker, the Hon. Member has practised law both in Ontario and in Nova Scotia. Can he explain the type of disclosure required in the Province of Nova Scotia with respect to those who lend money on mortgages, mortgage brokers and so on? What type of disclosure is required in Nova Scotia? In his speech, the Hon. Member mentioned that the disclosure provisions are not required, that provinces have disclosure provisions and this is a duplication of a kind of disclosure already required.


Howard Edward Crosby: Mr. Speaker, the Hon. Member for Mississauga South has struck a very interesting chord in his question, particularly as it relates to the Provinces of Nova Scotia and Ontario. As I indicated, Nova Scotia was the first province in Canada to enact consumer protection legislation. That occurred in 1966 when the legislature of the Province of Nova Scotia enacted the Consumer Protection Act. It should be admitted that the provisions of that Consumer Protection Act were based on a report that emanated from the Government of the Province of Ontario, a Progressive Conservative Government that had examined the problem concerning consumers in relation to loan transactions, particularly mortgage transactions. It recommended that certain disclosure requirements be enforced through law.
Nova Scotia acted upon that kind of advice and that of other legislative committees that had studied the matter and formulated the Consumer Protection Act. That Act has been in force since 1966, with amendments intended and designed to meet needs as they arose over that period of time.
To deal directly with the Hon. Member's question, the Consumer Protection Act of Nova Scotia, and I am certain there is similar legislation in every other province, requires that a lender advise the borrower of the exact interest rate that will be enforced throughout the life of a loan, and that includes
Interest Act
a mortgage loan, so that the borrower knows exactly the rate of interest, the basis for calculating that interest and the amount. The concern of most consumers and most mortgage borrowers is the amount they will have to pay on a monthly basis. The consumer protection provisions require full and proper disclosure of the exact amount that will have to be paid throughout the life of a loan. In addition, there is a requirement that the mortgage borrower be advised of the rate of interest in exactitude. That means the ancillary provisions and whether it is calculated annually, semi-annually, cumulatively and so on. All of that information must be given not only to mortgage borrowers but to all borrowers of funds in consumer situations.
In addition, there are other specific requirements that relate to all loan transactions. The borrower must be informed of the place of business of the lender and other vital statistics. The matter is completely covered. To the extent that it is not covered, I am sure simple amendments to provincial legislation would cover any other areas that might give rise to problems.


Mr. Taylor:: Mr. Speaker, I commend the Hon. Member for Halifax West (Mr. Crosby) for a very interesting and excellent address. He is not only highly trained but is a highly experienced barrister.
I would like to get his view on a matter. When interest rates were at their highest, I had a number of cases concerning my constituents. One problem in particular comes to mind at this time. A family suddenly came into sufficient money to pay off their mortgage. If I recall correctly, the interest rate was 18 per cent. They went to the trust company which held the mortgage and reminded it of its promise that they could pay off the mortgage with a two-month penalty. The trust company said that could not be done, that there would be a two-year penalty because the money had been invested in a long-term investment. Therefore, the family was told they had to pay a two-year penalty in order to get out of the mortgage.
I thought that was outrageous. I referred the matter to the Minister of Finance because he had indicated in the House that he wanted these kinds of cases brought to his attention. I brought it to his attention and he sent me a letter containing a list of all the trust companies and telling me to write to them myself. That was not very helpful.
I did write to the mortgage companies and they were able to do very little for my constituent. They continued to say that they had invested in long-term investments. I reminded the mortgage companies that many of their investments were short-term investments and perhaps the majority of them were short-term investments. I would like to hear the comment of the Hon. Member for Halifax West regarding what a reasonable penalty would be when a family is able to pay off its mortgage. What would be fair to both the mortgagor and the mortgagee?


Howard Edward Crosby: Mr. Speaker, my colleague, the Hon. Member for Bow River (Mr. Taylor), has described the classic case and

June 7, 1984
Interest Act
asked the classic question. I know that he believes as I do that a lender should be entitled to fair compensation for the cancellation of a transaction, but he should not be entitled to a windfall profit arising from the good fortune-or the misfortune-of the borrower. When answering that question in terms of the law that we enact, we must try to achieve a balance between those two rights.
I can best answer the question of the Hon. Member for Bow River by going back a bit in time to see what the developments in the mortgage market in Canada have been in relation to the Interest Act that is now before us and in relation to Section 10 of that Act. For many decades, the classic mortgage system in Canada was that a mortgage was held for a 25-year term. In more recent times that was reduced to a five-year term after which time the mortgage interest rate was renewed. That term has now been reduced to as little as one year.
The reason I mention this bit of history is that for many years the mortgage provision in the Interest Act was that if a mortgage ran for more than five years-and most mortgages ran for at least 20 years-that mortgage could be paid off after a five-year term with a payment equal to three months' interest. I believe I am correct about that but the Hon. Member for Mississauga South can correct me if I am not. In other words, the so-called penalty was based on the monthly interest rate in relation to that mortgage. However, there was no provision for mortgages with terms of less than five years. That is to say, such a borrower was left to the provisions of the mortgage or to the good offices of the lender. That is the situation in which the constituents of the Hon. Member found themselves. There was no clear provision in law with respect to their rights when paying off the mortgage.
In those circumstances, many mortgage lenders claim that they have taken money from their investors and promised to pay them a rate of interest over a long period of time, like five years, and they then take the attitude that the only fair thing is for them to receive all of the revenues that they would have received had the borrower kept the money he had borrowed for that entire period of time. Of course, that is an extreme position and it is a ridiculous one. Unfortunately, that was the position taken by many of Canada's foremost lenders, including the banks and large mortgage companies. That is why we as legislators must step into that situation and make our judgment with respect to what is fair. The thrust of my position is that the Government should make that judgment. Such penalties should be based upon a monthly interest payment and I think the penalty should be no more than three months' interest.


Mr. Deputy Speaker:: Order. The House will now proceed to debate.


Mr. Dave Nickerson (Western Arctic):: Mr. Speaker, when speaking today on Bill C-36, the amendments to the Interest Act, I will go backwards. I shall begin with the last provisions in the Bill which is before us, being Clauses 4 and 5 which deal with the interest payable on judgment debts.
I am pleased to see that the amendment regarding judgment debts is before us today. In effect, what it does is remove an anachronism that has existed since 1880 or even longer. At that time the Provinces of Alberta and Saskatchewan did not exist but were contained within the Northwest Territories. Ever since Confederation the eastern provinces had within their legislative authority the ability to specify the interest payable on judgment debts. It makes no sense to have one law affecting eastern Canada and a different law affecting western Canada.
I would hope that the western provinces and the western territories which, as a result of the passage of this Bill, will have the authority to stipulate in their own legislation the interest payable on judgment debts will take upon themselves the responsibility to do so as soon as possible. However, when doing so I would hope that they would keep in mind that as much as possible interest payable on judgment debts should be uniform across Canada.
Although I agree that it should be within the authority of the province or territory to set these rates, it does not make much sense if the rate is 5 per cent in one province, 7.5 per cent in another province and 10 per cent in another province. I think that the provinces and territories should get together and try to come up with a uniform rate if that is at all possible. As well, when changes are made the provinces should act in concert to keep those rates reasonably uniform across Canada.
Again working from the back of the Bill forward, the next prime issue contained therein is that dealing with disclosure. This deals with what, by law, should be disclosed within a mortgage document. Items dealing with disclosure were contained in Section 6 of the old Act. This is certainly not a new concept.
Today we heard that many provinces go much further than the federal Parliament when requiring disclosure of certain terms and conditions with respect to mortgages. The point has been made that most mortgage lenders are already obliged to comply with the provincial requirements and that some difficulty and additional expense might be imposed upon them by making it necessary at the same time for them to comply with federal legislation. Although those additional expenses would be minor, I would imagine that the difficulties could be worked out so the lenders could easily comply with both provincial and federal disclosure requirements.
In reading through the proposed changes to Section 6 of the Act which are contained in Clause 2 of the Bill before us, what strikes me is some of the new things that will have to be disclosed. In 1880, the year the present Act was passed by the Parliament of the day, if someone had suggested that at some point in the future of Canada we would be thinking about mortgages with terms and conditions dealing with changes in principle because of inflation, the legislators of that day would not have had the foggiest idea what he was talking about.
In those days the term of a mortgage was generally a period of 20 years or more. There was an element of stability to mortgages. The terms and conditions were reasonably simple. They were such that someone who homesteaded a farm in
June 7, 1984

Alberta or Saskatchewan, although those provinces did not exist at the time, would understand along with legal counsel in the small settlements what they were all about.
I see that it is very close to one o'clock. I might call it one o'clock, Sir, and continue this afternoon.


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


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.


Mr. Gerry St. Germain (Mission-Port Moody):: Mr. Speaker, I would like to bring to the attention of this House the fact that a delegation of mayors and reeves from the Fraser Valley of British Columbia is presently in Ottawa. Mayor John Agnew from Mission, Danny Griffin from Maple Ridge, Danny Sharpe from Pitt Meadows, John Jansen from Chilliwack, Paul Inkman from Harrison Hot Springs, Lloyd Foreman from Boston Bar, and Brian Appleby from Dudney-Allouette regional district are here to discuss and co-ordinate a plan of direct action to resolve catastrophically high levels of unemployment. It bears emphasizing again that in the area of Mission-Port Moody and Fraser Valley East average unemployment stood between 14 per cent and 15 per cent. However, with the shake and shingle mill shut down, the rate stands at an alarming 47 per cent to 52 per cent. If one takes into account the native population, the rate climbs to an astonishing 58 per cent.
A Fraser Valley College private study pointed out that the job situation is devastating. There could be as many as 15,000 young people in that area looking for jobs this summer. The problem of unemployment must be dealt with swiftly. I appreciate the commitment given by the Minister of Employment and Immigration (Mr. Roberts) and I now look to him to flesh out the particulars of the LEAD program and the reforestation assistance program. This is an opportunity to show that the Government can respond to Canadian citizens who are really in need. I urge all Ministers and officials who are meeting with this delegation to do their utmost to help in trying to resolve this terrible unemployment problem.



RUMOURS REPORTED IN ANGLOPHONE PRESS ABOUT MEMBER FOR MANICOUAGAN

Mr. Andre Maltais (Manicouagan):: Mr. Speaker, last week, the North Shore gave one of its sons a royal welcome. The North Shore knows the meaning of hospitality. However, Mr. Speaker, I would also like to mention that last week, the English-speaking press said that the Member for Manicouagan, despite his affinity and friendship with the Leader of the Official Opposition, might switch to provincial politics or at least leave his seat vacant.
From my seat, I would like to point out that there has never been any question of any agreement with the Leader of the Official Opposition, and if the latter or someone else from the Progressive Conservative Party wants to run on the North Shore, out of loyalty and solidarity with workers and ex-workers, there will be a race! Chances are we may see another contest between David and Goliath. In both cases, I think workers and ex-workers will decide who is going to represent them on the North Shore, considering the economic problems this region is experiencing at the present time.



CONSTRUCTION OF HEAVY OIL UPGRADER IN LLOYDMINSTER, SASK.

Mr. Bill McKnight (Kindersley-Lloydminster):: Mr. Speaker, yesterday was an exciting day for the people of Alberta and Saskatchewan. The long awaited announcement was made that Husky Oil Limited will build a heavy oil upgrader in Lloydminster with a capacity to produce 42,000 barrels of synthetic refinable crude oil per day. This giant leap forward for Canada's energy self-sufficiency, long overdue, will bring a renewed vitality to the petroleum industry in western Canada. It will have a significant economic impact.
Some $1.2 billion worth of Canadian manufactured goods will be purchased over the next five years. It will provide much needed employment opportunities through some 18,000 person years of employment during construction, and 3,600 permanent jobs thereafter. Husky, a truly Canadian enterprise, must be congratulated for its commitment. Because it has persevered, Canada will benefit.
Lloydminster is unique. It is the only city in Canada whose main street is the border between two provinces, those of Saskatchewan and Alberta. The Hon. Member for Vegreville (Mr. Mazankowski) and I have the honour of representing that community. The Bi-Provincial Upgrader so named by Husky, comes to my riding as a result of the spirit of co-operation and the climate of confidence established by Husky Oil and the Progressive Conservative Governments of Alberta and Saskatchewan, the management of Husky Oil, and the Minis-

June 7, 1984
ters of Energy, the Hon. Paul Schoenhals, the Hon. John Zaozirny, and the Hon. Jean Chretien-


Mr. Speaker:: The Hon. Member's time, unfortunately, has
expired.



EXTERNAL AFFAIRS


Mr. W. Kenneth Robinson (Parliamentary Secretary to Minister of National Revenue):: Mr. Speaker, on Sunday, March 27, 125 demonstrators marched in support of three hunger strikers who have been camping outside the Polish Consulate in Mimico, a part of my constituency. For the last 16 days they have survived on water. After 18 days of this, permanent damage to their bodies may occur. They are starving in protest. They cannot bring their families into Canada because Polish authorities will not recognize the visas held by their spouses and children. These measures are drastic, and although the hunger strikers have been told it is blackmail and unfair pressure, they will continue with their protest.
One of the strikers, Grazyna Trzesicka, has attempted 11 times to reunite her family in Canada over the past two years, and 11 times she has been refused. Both Zygmunt Augus-tyniak and Wladyslaw Sliwa, whose applications were being considered by the Polish authorities, went on this hunger strike after a six-month delay for consideration was imposed, and after a "no" answer was finally given. All of the hunger strikers have been told that the decisions are final with no consideration whatsoever being given, and no appeal will be considered.
When applications for exit permits are refused, the remaining family members are often told they must bear the consequences for their relatives who emigrated illegally. This collective responsibility on the part of family members exists in all communist countries. We, as Canadian citizens, are quite fortunate. We have a choice. We have rights. We have a voice.
These hunger strikers have not seen their families in a long, long time. It is most unfortunate that people have to resort to these-


Mr. Speaker:: The Hon. Member's time has expired.



FORTIETH ANNIVERSARY OF ALLIED LANDINGS IN NORMANDY


Hon. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I trust you will forgive me for mentioning something today that I perhaps should have spoken about yesterday. However, I would like to associate myself with the tremendous words of those who spoke yesterday about the events of June 6,
1944. Some of my friends were reminded that I was here on that occasion and said that perhaps I should say so now.
I would like to have this opportunity not only to add to those tremendous words that were spoken yesterday, but also to say that I am very conscious of the speeches that were made in this Parliament on June 6, 1944. As I said, I happened to be here. It so happened that Mr. Coldwell, our leader, was absent that day and it fell to me to speak on behalf of our Party. All of us who spoke that day in 1944 were concerned for the support of those who carried on the war, and our hope was that it might soon be won. As you know, we did succeed the following year, but we were also concerned about those who lost their lives or their health in that war.
I am glad that other Members have spoken in the last few days about the veterans' pensions which need to be increased for some of our veterans, especially for those who were injured during the war. I urge that something be done about that now. It is good that we have done so much in the field of veterans' pensions, but there is more we could be doing, and I hope we will. Again I thank Members of 40 years ago and those of today for the things that have been said on this important event.


Some Hon. Members:: Hear, hear!



CANADA MORTGAGE AND HOUSING CORPORATION


Mr. Maurice A. Dionne (Northumberland-Miramichi):: Mr. Speaker, in this House we frequently hear talk about the need to improve national productivity in order to get our economy moving again. If we are looking for an example of how to improve productivity, I believe that the building inspection operation of CMHC provides a good example. Not only did it complete 600,000 inspections valued at $23 million in 1983, but it also defrayed CMHC's overhead and indirect costs to the tune of over $5 million. I believe that virtually everyone recognizes the competence and professionalism of CMHC inspectors.
It has also increased its productivity by over 50 per cent in the past two years. I would therefore like to congratulate the Minister and the Corporation on their success. I would like to make a suggestion. Since housing is becoming more complex, and since many of the more than 4,800 municipalities in Canada simply cannot afford a resident building inspector, I would like to suggest that the Minister offer the building inspection services of CMHC to small municipalities. There would be many benefits from such a move.
1.	Competent inspection services would be available in areas where none presently exist.
June 7, 1984

2.	We would be seen to be doing something for small municipalities at a time when they are particularly strapped for financing.
3.	We would be assisting provinces to implement the National Building Code, something we have been trying to achieve for years.
4.	We would be providing protection against property deterioration and rising costs to our constituents.
5.	We would be enhancing and promoting the expertise and efficiency of the CMHC inspection operations-


Mr. Speaker:: The Hon. Member's time has expired. The Hon. Member for Bruce-Grey (Mr. Gurbin)



ENVIRONMENTAL AFFAIRS


Mr. G. M. Gurbin (Bruce-Grey):: Mr. Speaker, this is Canadian Environment Week and is thus a good time for reflection on our environmental track record. I am disappointed that the Minister of the Environment has chosen to say that this is a week of celebration. I agree we must give thanks for our environmental assets, but we must also take time for sober observation of the current state of affairs.
Recently Canada has experienced many environmental problems. Attempts to redress these problems, however, have often been hampered by the inefficiencies of and lack of real action by the current Liberal administration. Take for example the recent reports of the Royal Society of Canada and the sub-committee on acid rain which reviewed the quality of Canada's acid rain program. The Royal Society found that, although the program includes much excellent research, there were major problems, such as a lack of over-all planning and too little co-ordination of effort, particularly in research. The acid rain subcommittee found words but no real action.
We must set our environmental priorities and tackle the job directly and efficiently. Our main concerns now are with the clean up of acid rain, the elimination of toxic substances, the safe and permanent disposal of hazardous wastes, and the revitalization of the forest sector. We must do our utmost to clean up our own back yard. At the same time we must convince the United States to do likewise.
Our approach must be positive and action oriented. The results of today's efforts will determine the environmental future of all Canadians. So far, the Government has very little to celebrate.
S.O.	21 RAILWAYS



WESTERN GRAIN FREIGHT RATES-COST TO FARMERS

Mr. Lee Clark (Brandon-Souris):: Mr. Speaker, western Canadian farmers are in danger of buckling under the weight of a projected 58 per cent increase in the cost of moving grain. As a result of the Liberals' Crow Bill, each western grain producer will pay, on average, between $500 and $1,500 more to move grain in the next crop year. That is an extremely heavy burden for a sector already enduring extremely trying times.
The cause for virtually the entire increase coming up in August is the cap on the amount of western grain shipments subsidized by the federal Government. Because prairie grain shipments will exceed the 31.5 million tonne cap in the current crop year, the producers will have to pay the full freight rate on more than 3 million tonnes of grain in the coming crop year, an additional $60 million in total. As well as being the cause of a dramatic freight increase, the cap is also a disincentive to improved western grain production. Surely a disincentive to food production is in no one's best interest.
It is my understanding that the Minister of Transport has directed the Special Grain Transportation Committee to review this matter. I urge the Minister to ensure, not only that the issue is studied soon, but that the opinions of groups representing western grain producers are reflected in any decision taken. The Crow Bill and other Liberal Government policies have caused financial hardship for far too many prairie farmers. I call upon the Government to put the needs of western Canada first for once, by abolishing the volume cap on subsidized prairie grain shipments.



MULTICULTURALISM


Mr. Laverne Lewycky (Dauphin-Swan River):: Mr. Speaker, on May 3, 1984, my office corresponded with the Ministers of Employment and Immigration and Transportation concerning an urgent request for special funding for a project that is of the utmost importance. To date, no adequate response has been given.
Selo Ukraina is a project which seeks to preserve Canada's Ukrainian culture and heritage through the construction of a Ukrainian village located just outside Dauphin, Manitoba. Selo Ukraina is to have the distinction of being officially opened by Her Majesty Queen Elizabeth II on July 25, 1984. This has brought with it some weighty logistical problems and unforeseen financial burdens.
Selo Ukraina must construct three-quarters of a mile of access road some two years before its projected budget and development plan. The existing access road will simply not be adequate to handle the anticipated flow of traffic, and does not

June 7, 1984
Oral Questions
satisfy the fundamental security requirements associated with the royal visit.
Given the immense potential for growth arising out of the national and international visibility engendered by the royal visit, I am once again requesting the aforementioned Ministers to give consideration to federal funding. The impending visit of Her Majesty gives great urgency to this matter and necessitates the Ministers' immediate and sympathetic attention.



THE ECONOMIC SUMMIT


Mr. Bill Yurko (Edmonton East):: Mr. Speaker, the dominant issues in Canada today are jobs, economic growth, and investment. We tolerate an unemployment rate of 25 to 30 per cent amongst our youth. Our economy staggers somewhat drunkenly, while the economy of the United States is booming at a growth rate reaching 9 per cent. Never before in history has so much foreign money been coming back to the United States, being drawn to that country by high interest rates, sound investment potential, and future stability. This dynamic U.S. economic resurgence is precipitating increasing hardship throughout the free world. Free world leaders are concerned.
On this very day the leaders of France, Germany, Italy, Britain, Japan, the United States, and Canada are meeting at an economic summit. Their agenda has two dominant items- U.S. and world interest rates, and world debt levels. However, this meeting is missing some essential parts. The Arab nations which produce much of the world's trade in oil are not represented. Why was a country such as Saudi Arabia not invited to attend? The world of debt is primarily represented by South America and Mexico. A representative like Brazil should have been invited to attend this summit meeting. This exclusive club of seven must grow if it is to solve the world's economic malaise.



ORAL QUESTION PERIOD


Donald Alex Blenkarn: Mr. Speaker, in the absence of the Minister of Finance, my question is for the Minister of State for Finance. As a result of the weekly Thursday auction, the Bank of Canada rate is 11.77 per cent. That is so despite massive intervention and buying by the Bank of Canada of its own Treasury Bills. This represents an increase of 23 bases points over last week and clearly indicates that prime rates will rise again.
There have been massive increases in interest rates since the Budget. There is real disquiet in the country. There is real lack of confidence, particularly as this increase in interest rates has not really improved the value of the Canadian dollar one bit. Therefore, will the Minister suspend the debate we have today, and on Motions after the Question Period outline to the House what proposals the Government has to stem the fall in the Canadian dollar and to bring some confidence back into the economy of the country? What proposals has he, other than massive increases in interest rates such as those which took place in 1981 and 1982 when the same condition was in effect?


Roy MacLaren: Mr. Speaker, the Hon. Member opposite, as in the case of his colleague, the finance critic for the Opposition, constantly engages in a doom and gloom outlook for the Canadian economy which I, for one, certainly do not share. On the contrary, we see some real evidence of growing strength in the Canadian economy.
I shall deal with the question which the Hon. Member raises. The fact is that interest rates in Canada are, to a significant degree, a function of interest rates in the United States. In the United States the combined upward pressure of private sector borrowing and a substantial structural deficit in the U.S. economy drives up U.S. interest rates. Canadian money flows out of Canada on a short-term basis looking for greater return in the U.S. market.
In those circumstances, the same thing occurs in Canada as occurs in all industrialized countries. We see either a moderation in the value of the Canadian dollar versus the U.S. dollar, or an increase in Canadian interest rates to retain an attractive investment opportunity for Canadian and foreign money in Canada.
Let us be clear on what is happening. The situation in Canada is occurring generally throughout the industrialized world. The Member opposite must know that short-term interest rates in most industrialized countries have been increasing in the face of increases in the United States interest rates. Equally, the Hon. Member must know that the exchange rate value of major foreign currencies vis-a-vis the U.S. dollar has been reduced. For example-


Mr. Speaker:: Order. I wonder if both the questions and the answers could be shorter. The Hon. Member for Mississauga South, for a question that is hopefully a little shorter.


INTEREST RATE LEVELS-MINISTER'S BUDGET STATEMENT
Donald Alex Blenkarn: Mr. Speaker, he took an awful long time to say nothing. He has not told us why the American economy is bustling while we have more unemployment today than we had in 1981. He has not told us why fewer people in Canada are working today than in 1981.
I will direct my supplementary question to the Minister, who has a lot of nothing to say. He will recall that the
June 7, 1984

Minister of Finance said in his Budget that if nominal and real interest rates were to rise significantly above current levels, the recovery itself would be at risk. Nominal and real interest rates have risen by between 2 per cent and 3 per cent since the date of the Budget. The economy is at risk. What proposals does the Minister have, other than the guff he has been giving us, that will give the country some confidence?


Roy MacLaren: Mr. Speaker, the economy is not at risk. The Hon. Member opposite is talking nonsense. The fact is that we have seen, in recent months, an increase in U.S. interest rates. That has a twofold effect. It has meant that the U.S. dollar has increased in value against the currencies of all major western industrial-zied countries.


Mr. Andre:: Why don't you do what they did, and get Canadians back to work?


Roy MacLaren: It has also meant that interest rates in Canada and other industrialized countries have been trending upward as a result of that pressure. Canada has joined with other industrialized countries in seeking, with the United States, a solution to the problem of high interest rates within that country. These high rates have had their natural spill-over in Canada. I am surprised that the Member opposite does not recognize that basic economic fact.
Equally, I am surprised that the Member opposite does not recognize that in recent months, indeed for the past year and a half, we have had major achievements in growth in the Canadian economy. I speak, for example, of the-


Mr. Speaker:: Order. The Chair has some concern about the length of answers. A further supplementary to the Hon. Member for Mississauga South.


Donald Alex Blenkarn: Mr. Speaker, clearly the Government has no plans. All we get from the Minister is a mouthing of the same old inconsistencies and lack of hope. He is here to apologize for the Minister of Finance. The Minister of Finance is going throughout the countryside looking for a new job.


Mr. Speaker:: With all due respect, the Hon. Member should ask his supplementary. This is a second supplementary.


REQUEST FOR CALLING OF ELECTION
Donald Alex Blenkarn: Mr. Speaker, the only solution is to direct my supplementary question to the Acting Prime Minister. In view of the fact that the Minister of Finance cannot bring any proposals before the House to give the people of the country some confidence, and in view of the fact that the Minister of State for Finance just mouths old prepared answers from some bureaucrat, will he cast around his backbenchers to see if he can Find someone else who can come forward and act as a Minister of Finance and give the country some hope? If he cannot find anyone else, will he at least do the country a favour and call an election?
Oral Questions


Mr. Speaker:: Order. The Chair has some misgivings about the nature of the question. The ministerial responsibility of the Acting Minister of Finance is limited in respect of the questions offered.


Roy MacLaren: Mr. Speaker, as is usual on his side of the House, the Member opposite engages in a lot of gloomy forecasts. Clearly he offers the Canadian people none of the reassurance and optimism which are a necessary element in our economic outlook. The fact is that we have been able to maintain interest rates in Canada at a level which, for the past 18 months or so, has been running level with or below that in the United States, which is a remarkable achievement in the Canadian economy. Indeed, today the prime rate in Canada is lower than that in the United States. That is in part the result of our very real achievement in, for example, the growth in our export trade. The Member opposite overlooks the fact that our trade balance in April improved by $1.8 billion.


Mr. Speaker:: I am sure that the Hon. Minister has made his point.


LABOUR CONDITIONS
Hon. John Wise (Elgin):: Mr. Speaker, in the absence of the Minister of Employment and Immigration I will direct my question to the Minister of State for Finance. It deals with the unemployment rate, and more particularly the youth unemployment rate.
Earlier this morning the Social Planning Council of Metro Toronto released a study which indicated that, indeed, youth unemployment was not some 18.5 per cent but some 26.5 per cent.
In the last few days the Corporation of Dieticians of Quebec indicated that many unemployed youths in that province were driven to desperate measures simply to seek enough Financial remuneration to buy food. It is obvious that government programs are not working. Will the Minister immediately introduce some substantive programs to deal with this very, very serious problem?
[ Translation]


Hon. Celine Hervieux-Payette (Minister of State (Youth)):: Mr. Speaker, we have indeed read the report, which does not contradict the data we are going to release today in a report on youth in Canada. In fact, the ofFicial statistics released by Statistics Canada are those used internationally by OECD members. If there is any difference, it is because they do not allow for "hidden unemployment" among young people who have given up looking for employment. Thus, as Minister of State for Youth, I accept these figures. However, I think the Hon. Member should realize that $150 million have already

June 7, 1984
Oral Questions
been added to the $1.1 billion earmarked for youth. We earnestly hope that the measures suggested in the report that will be tabled this afternoon will be approved by Opposition Members, so that we can act as soon as possible.


MINISTER'S SPEECH IN MONTREAL
John Wise: Mr. Speaker, my supplementary question is directed to the same Minister. I am not clear whether the Minister, in her response, is taking the position that she is agreeing with the study of the Metropolitan Council-the Acting Prime Minister is shaking his head no.


Mr. Pepin:: Nobody does completely.


John Wise: If the Minister of State for Youth is disagreeing with the fact that indeed the true number of young Canadians between the ages of 15 and 24 who are unemployed is some
788,000,	then why did the Minister, shortly after her appointment, travel to Montreal and speak to a meeting in Montreal indicating that the true figure of those people who were unemployed in Canada would well exceed 700,000? Answer that question.
[ Translation]


Céline Hervieux-Payette: Mr. Speaker, I think the exact figures we are releasing were provided by experts at Statistics Canada. Last month, according to StatsCan, 463,000 people were unemployed; 106,000 had given up looking for employment and 250,000 were working part time and had no steady job.
We therefore accept the figure of around 800,000 which appears in the study by the Social Planning Council. We do not necessarily agree with the rest of the report. We are only referring to the figure of 800,000.


THE ECONOMY
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, I listened with care to the Economics 101 lecture we got from the Minister of State (Finance). Following his homily, I have a question for the Acting Prime Minister. The Liberals promised in the 1980 election campaign, a low, made in Canada interest rate policy. As the Minister of Finance has told us that in effect there is nothing the Government can do now, that our interest rate policy, according to that Minister, now will be set in Washington, and considering the Americans in the late 1960s and 1970s took action to stop an outflow of capital from their country and were concerned about doing something about jobs and employment for their people, will the Acting Prime Minister tell us why we cannot take some independent
action to protect our dollar, to keep down interest rates, and produce jobs in Canada?


Roy MacLaren: Mr. Speaker, the fact is the Hon. Member opposite asked whether we are pursuing an independent interest rate policy. The Member opposite should realize that to the degree that we have been able to close the traditional gap between U.S. interest rates and Canadian interest rates, we have done so, we have indeed succeeded in closing that interest rate gap. We have done so despite the fact that over a number of years Canadian interest rates have tended to be well above United States interest rates as much as four and five percentage points.
Due to the basic strength of the Canadian economy in terms of a reduction in inflation, in terms of an increase in our export trade and in terms of greater productivity in the Canadian economy, that we have been able to maintain interest rates in Canada at the level of, or in some instances, as today with regard to the prime rate, below those of the United States. Therefore, Mr. Speaker, I would suggest to the Hon. Member opposite that he consider whether in those circumstances we have not delivered on our undertaking.


Mr. Epp:: Order.


Roy MacLaren: With regard to the second part of the Hon. Member's question, we have, in fact, provided the environment in which we can maintain a degree of independence in our interest rate policy. But if the Member opposite thinks for a moment that with the free flow of capital, the free flow of people and money between our two countries, we are able to immunize ourselves, when 70 per cent of our export trade is with the United States-


Some Hon. Members:: Order.


Roy MacLaren: -from interest rate pressures there, he is very much mistaken.


John Edward Broadbent: Mr. Speaker, it would be hard to get a greater combination of complacency and nonsense than that which we have just heard from the Minister.


UNITED STATES PRECEDENT
John Edward Broadbent: Mr. Speaker, if the United States in the 1960s and the 1970s, to pick up on the last phrase of the Minister of State for Finance, took steps to stop the free flow of capital, because that is what the Americans did, because the Americans had a Government then that was interested in American jobs-if they could interfere with the free flow of capital to keep interest rates down and produce American jobs, why cannot the Government of Canada, committed to Canadian interests, do the same thing for the people of Canada?
June 7, 1984


Roy MacLaren: Mr. Speaker, the Hon. Member opposite does not know what he is talking about.


An Hon. Member:: Do you?


Roy MacLaren: The United States in those days was an exporter of capital.


REQUEST THAT GOVERNMENT IMPOSE CAPITAL OUTFLOW TAX
John Edward Broadbent: Mr. Speaker, I will be glad to send over to the Minister a copy of the legislation which the Americans introduced and kept on the books for almost a decade to cover such situations.
I want to be specific in my question and I ask the Minister to be specific in his answer. The estimated cost to Canadian business caused by today's almost one-quarter of a per cent increase in the rate could run in the neighbourhood of $200 million, which means that Canadian business will not be investing. We already know Canadian business investment intentions are down, which means that we will not get the jobs we need. Why will the Government not levy a special speculator's tax on capital flows beyond a certain level, against people who are acting contrary to Canadian interests, so as to keep capital in this country?


Roy MacLaren: Mr. Speaker, the Member opposite simply does not understand the nature of the economic relations between Canada and the United States. The fact is that not only does 30 per cent of our gross national product depend on our export trade, and therefore 30 cents of every Canadian dollar-the earnings of every Canadian are affected by our export trade. And 75 per cent of that is earned in our trade with the United States. Is the Member opposite proposing that we somehow close our borders, or that we put a cap on, or that we limit the flow of money between our two countries-that we artificially close our borders and say to people moving between our two countries, investing between our two countries, buying the products between our two countries-


John Edward Broadbent: Answer the question.


Roy MacLaren: -"That's it. We are now closing the borders" because of some hypothetical or theoretical desire to maintain some level of the Canadian dollar? The Hon. Member opposite is surely more sophisticated than that. He must know better than that. He spoke earlier of Economics 101. He would do better to take a course in Economics 100.


LABOUR CONDITIONS
Hon. Flora MacDonald (Kingston and the Islands):: Mr. Speaker, my question is for the Acting Prime Minister. It
Oral Questions
concerns the report produced by the Social Planning Council of Toronto. This report reflects the fact that the Government ignores some 250,000 young people who are under employed or are discouraged workers. They simply do not exist according to the Government. They are lost statistics. But each lost statistic, Sir, is a young person who perhaps works only two hours a week mowing a lawn, because that is the only work he can find. The system rejects him; the computers do not record him. Why is it that that young person, and the 250,000 like him, have no place in this country to turn under the Government's misdirection of the economy?


Jean-Luc Pepin: Mr. Speaker, I am really very surprised because the Minister of State for Youth has just said that she recognized-she spelled it out- the problem. Obviously the hon. lady's question was prepared this morning because the Minister of State for Youth just said that there were statistics, conventional statistics, provided by StatsCan. These were the ones that were comparable to other world statistics. She recognized, secondly, that some young people have given up looking for employment.


Mr. McDermid:: What do you mean, some?


Jean-Luc Pepin: She recognized, thirdly, that some young people were under employed. She has just said that. Why is my hon. friend asking a question which indicates that she was not listening at all?


John Horton McDermid: There is a problem. What is the solution?


PLIGHT OF UNLISTED UNEMPLOYED
Flora Isabel MacDonald: What the Acting Prime Minister has not done is to look at the statistics themselves to see that the Government only reports there are half a million young people looking for work. He does not take into consideration, and the statistics the Government releases do not take into consideration, that there are 250,000 more who are underemployed and discouraged workers. That is what the Government does not show in its statistics. Why is that difference made? Why does the Government not recognize that the plight of these people is just as great as those who may be listed in the unemployment statistics? Why does the Government make a difference between these two groups of people? The Government does this every month when it is reporting the statistics.


Jean-Luc Pepin: Mr. Speaker, I read the article too. The Secretary of State for Youth has indicated what I think is the common sense approach. The conventional statistics, the ones that are used in Canada, in Great Britain, France, the United States and what not, bring in a degree of certainty in the estimating of unemployment among young people. The other type of statistics bring up questions such as why people have given up looking and are rather psychological. The reason may very well be "because I have looked for two or three months and I haven't found one." The reason can also be "because I am lazy".

June 7, 1984
Oral Questions


Some Hon. Members:: Oh, oh!


Jean-Luc Pepin: Yes. Consequently the Minister of State for Youth just made the argument that there was a degree of certainty in the conventional way of establishing statistics on unemployment and there was more social psychological consideration in the estimation of other types of statistics concerning youth.


An Hon. Member:: He dismisses them because he says they are lazy.


ALLOCATION OF YOUTH EMPLOYMENT FUNDS ON A CONSTITUENCY BASIS
Hon. James A. McGrath (St. John's East):: Mr. Speaker, I hope the Acting Prime Minister is not trying to tell us that there are 200,000 lazy young Canadians who do not want to work, because that is what he said.


Mr. Lapointe:: You are stupid.


James Aloysius McGrath: No, the Minister is stupid for saying that in the House.


Some Hon. Members:: Hear, hear!


James Aloysius McGrath: Mr. Speaker, my question is directed to the Minister of State for Youth. She said today that in her estimation there are 800,000 young people unemployed. She also indicated that she had about $150 million which she could use in a discretionary way to address that problem on a constituency basis.
When her Estimates were before the committee on May 29, her Deputy Minister, in response to whether or not Statistics Canada data were relevant, said:
I think it is a fact that data officially compiled by Statistics Canada do not permit us to have reasonable assurance of data based on the local situations.
How then does the Minister allocate the money she has at her disposal on a constituency basis, if she cannot rely upon Statistics Canada data?


Céline Hervieux-Payette: Mr. Speaker, I believe my hon. friend is referring to a question about the formula being used to allocate subsidies to various ridings under the Summer Canada Program, subsidies which this summer should create 81,000 jobs for our young people at a cost of $200 million. I have answered this question, Mr. Speaker, and my Deputy Minister has provided the detailed information. The formula which is being used could not be based only on Statistics Canada data, because such data are not compiled on a constituency basis. We are using, therefore, a mixed formula which nevertheless takes into account local situations; it is being applied across the board to 281 ridings in Canada. Because there is no official Statistics Canada formula, we are using a statistical formula which applies to all ridings, whether Conservative, NDP or Liberal.


FORMULA FOR DETERMINING ALLOCATIONS
James Aloysius McGrath: Mr. Speaker, let me help the Minister in her education. We do not have Statistics Canada data by constituencies. According to the Deputy Minister and the Minister of Employment and Immigration, the allocations are applied according to the labour rate surplus. The Minister knows, or should know, that the labour rate surplus is based upon unemployment insurance recipients. Young people do not qualify for unemployment insurance. How, then, does the Minister determine which constituency gets what amount for Young Canada Works?
[ Translation]


Céline Hervieux-Payette: Mr. Speaker, we have indeed acknowledged that the formula is neither the one determined by Statistics Canada, nor the one used by Statistics Canada to assess the number of young unemployed, which the hon. member for Kingston and the Islands referred to earlier in her question. We recognize, therefore, that the official agency is not providing us with the necessary data, but that we have developed a formula which take into account the local realities. My hon. friend did not suggest an alternative; we are therefore left with the one we have at this time, which I suggest is fair for young Canadians and all ridings throughout Canada.


VETERANS AFFAIRS
Mr. Neil Young (Beaches):: Mr. Speaker, my question is directed to the Minister of Justice. For some years native Indians and their organizations have been attempting to convince the Government that many of the benefits which they received after the First World War and Second World War were the subject of fraud, in many cases by officials in the Department of Indian Affairs. Yesterday a study was released which confirmed that many of the claims of native veterans over the years were indeed factual. Would the Minister advise the House whether he and his Department would be prepared to investigate officials in the Department of Indian Affairs with a view to determining whether the allegations raised by that study are indeed factual? If so, will he initiate prosecutions against those Indian Affairs officials?


Hon. Mark MacGuigan (Minister of Justice):: Mr. Speaker, I have not had that study drawn to my attention. I must say that it is not easy for me to see how my Department or I would be involved if it is a matter of the substance of the programs that would come under the Minister of Indian Affairs and
June 7, 1984

Northern Development. If it is a matter of a prosecution for fraud, it would come under the appropriate provincial Attorney General. Of course the investigation would also be under the direction of that Attorney General. As the Hon. Member relates the facts, I am not sure how my Department would be involved.


REQUEST THAT INDEPENDENT INVESTIGATION BE CONDUCTED
Neil Young: Mr. Speaker, my supplementary question is directed to the Acting Prime Minister. There have been numerous studies made by committees of the House, including the Special Committee on the Disabled and the Handicapped, Veterans Affairs, and others, which have indicated that there is a real need for some independent investigation of the allegations raised by native veterans. Would the Acting Prime Minister undertake to make a recommendation to Cabinet that funds be allocated for such an independent investigation?


Jean-Luc Pepin: Mr. Speaker, I will take notice of the question. The efforts which Canada has made in this area are well known. We had a committee on this particular subject. However, I will look at the particular aspect raised by the Hon. Member.

[ Translation]


BILINGUALISM
Mr. Raymond Dupont (Chambly):: Mr. Speaker, my question is for the Minister of State for Fitness and Amateur Sport. In a previous statement, the Minister announced that his Department was ready to help the management of 22 sports organizations to improve their services in both official languages.
Now, the Minister has just announced the bilingualism policy for national amateur sports associations subsidized by the federal Government. Will the Minister tell this House to what extent the services provided by these associations will be improved for the benefit of French-speaking athletes?


Hon. Jacques Olivier (Minister of State (Fitness and Amateur Sport)):: Mr. Speaker, I merely want to say once again that, where the basic principles are concerned, it is obvious that the Canadian Government has had no change in policy, namely that we want to make sure that all of their services will be provided in both official languages within a year from now. It has been decided that 22 national organizations would provide such services this year, and on account of that, they will receive 50 per cent of all their subsidies from the Federal Government.
Oral Questions
With respect to the Canadian Olympic Association, which is not involved in this policy, I had the simple choice of requiring that the Association follow this policy or of not financing it and keeping our athletes from going to Los Angeles. Because such is my role, I much prefer to help our athletes, whether they are French-speaking or English-speaking, take part in the Olympics, and for the moment, I have absolutely no wish to involve the Canadian Olympic Association in that policy.
However, next year, the Canadian Olympic Association will be subjected to the new policy just like all the other organizations. My greatest wish is that all our Canadian athletes, whether they speak French or English, might take part in the Los Angeles Olympics; this is why the Canadian Olympic Association is not among the 22 federations I have selected.


Mr. Speaker:: The Hon. Member for Parry Sound-Muskoka.


Some Hon. Members:: Hear, hear!


Mr. Darling:: Mr. Speaker, from that applause you will no doubt be aware that I must have had a word in the question period earlier this morning with my colleagues, to say that even backbenchers have questions of importance.


ENVIRONMENTAL AFFAIRS
Stan Darling: Mr. Speaker, my question is directed to the Minister of the Environment who, I presume, is expecting a question today. He is aware that the subcommittee on acid rain tabled a report in the House this morning. I would appreciate his comments on whether he approves of the recommendations outlined by the committee after literally thousands of hours of study, briefs, and so on.


Hon.   Chas. L. Caccia@Minister of the Environment: Mr. Speaker, in reply to the Hon. Member, let me express my recognition and appreciation of his substantial contribution over the years on the issue of acid rain.


Some Hon. Members:: Hear, hear!


Mr. Caccia:: I say this because I know he was extremely active, long before I was given this assignment.
As to the recommendations contained in the report to which he referred, I am studying them. As the House is aware, it was published three hours ago. All recommendations are of significance, and I will study them thoroughly. On those on which there is a possibility to move in the immediate future, I will certainly do my best. Those that are practical in the long term will be put in the system, and for those that are impractical, I will provide members of the committee with a due reply.

June 7, 1984
Oral Questions


REQUEST THAT MINISTER PLACE RECOMMENDATIONS BEFORE CABINET
Stan Darling: Mr. Speaker, I appreciate the comments of the Minister. I am aware that he has to sell Treasury Board and Cabinet as a whole. I hope he will zero in on some of those very important recommendations and see that Cabinet looks them over and makes a decision now. So far, all we have been doing is talking. The Government has not done anything to show the United States that we mean business. Will he ensure that some of those recommendations are brought before Cabinet and put into effect immediately?


Hon.   Chas. L. Caccia@Minister of the Environment: Mr. Speaker, for the first time in Canada we have a dateline, 1994. The percentage of reduction, as a commitment of both the provincial and federal Governments, is 50 per cent. Therefore we have done more than talk. We have a plan of action. Second, we have met as a working group with the provincial Ministers. Third, we have registered, and will continue to register, and I know that the Hon. Member and his colleagues are active as well, with the Washington administration our desire that they join us in the plan of action that we have outlined, and for which we have obtained the support of nine nations in Europe. That is more than just words; that is action.


PRESENCE IN GALLERY OF THE MINISTER OF AGRICULTURE, LIVESTOCK AND RURAL DEVELOPMENT OF THE REPUBLIC OF EQUATORIAL GUINEA
Mr. Speaker:: 1 call to the attention of the House the presence in our gallery today of Senor Miguel Oyono Ndongo Mifumu, Minister of Agriculture, Livestock and Rural Development, of the Republic of Equatorial Guinea.


Some Hon. Members:: Hear, hear!


THE CANADA COUNCIL
Hon. David Crombie (Rosedale):: Mr. Speaker, my question is for the Acting Prime Minister. The Acting Prime Minister may be aware that an article in this morning's Globe and Mail by the immediate past chairman of the Canada Council, Mavor Moore, stated:
According to several members of the Canada Council living in various parts of the country, the Deputy Minister of Communications, Robert Rabinovitch, recently telephoned the director of the Canada Council, Timothy Porteous and instructed him that public criticism of the Government's plan in Bill C-24 by himself, or the staff or even members of the Council's board, would not be tolerated.
That squares with the testimony we heard on Tuesday from Brian Anthony, executive director of the Canadian Conference of the Arts, who said:
We have been led to believe that it would be inappropriate for any agency to risk its good standing and well-being at this moment by speaking out against Bill C-24.
These are very serious charges. This is a very serious matter. What steps will the Government take to rectify this situation and remove the atmosphere of intimidation and fear that now surrounds Bill C-24?


Jean-Luc Pepin: Mr. Speaker, the Deputy Minister of Communications emphatically denies that he exerted any pressure or intimidation on the executive director of the Canada Council. He denies that. The conversation he had with the said gentleman was at the request of the Minister, with the consent of his own Minister, and consequently quite within the rules of his function.
The Canada Council will be before the committee this afternoon, at the request of the Minister, who suggested that they should appear before the committee on the discussion of Bill C-24 and these questions can be raised there.
The Government intends to respect the tradition of autonomy which exists for cultural agencies in Canada, but there is also a tradition of accountability that must be reconciled with the tradition of autonomy. These subjects are very important and will be discussed this afternoon before the committee.


REQUEST FOR INVESTIGATION OF ALLEGATIONS
David Edward Crombie: Mr. Speaker, the gravity of the situation may not be clear to the Acting Prime Minister. The atmosphere of fear and intimidation of which I speak has been with us for a number of weeks. There are a number of groups which have failed to come forward because they fear the consequences for their own funding. Since it involves not merely the Canada Council but, as Brian Anthony pointed out, and he speaks for many arts organizations across the country, given the intimidation, these organizations are considering having to take "a dive" because they fear the intimidation from the Government, will the Acting Prime Minister undertake in this House to investigate other allegations which have been made with respect to cultural organizations beyond the Canada Council which had been intimidated as well?


Jean-Luc Pepin: Mr. Speaker, I really do not know to what allegations my friend is referring. Certainly the Canada Council was not intimidated. Obviously this morning's article by Mavor Moore is one where his own autonomy and independence explodes in public. If there are groups in Canada which feel intimidated, they will have an opportunity to express that fear. The committee is one place where they can do so.
June 7, 1984


CANADIAN ARMED FORCES
Mrs. Ursula Appolloni (York South-Weston):: Mr. Speaker, my question is addressed to the Minister of National Defence. In view of today's report of tragically high and increasing numbers of unemployed young people, can the Minister tell us if there is a corresponding increase in the number of applicants to join Canada's Armed Forces? If so, will the Minister again review the petition signed by 109 Members of the Liberal caucus and presented to the Prime Minister in the fall of 1982?


Hon.   J.-J. Blais@Minister of National Defence: Mr. Speaker, we are very much aware of the plight of the young unemployed. Of course there is a repercussion of that plight in terms of the number of applicants who are coming to the Canadian Armed Forces in order to seek to enlist. We have recognized that. With the assistance of the hon. lady, in the last year we introduced the Youth Training Employment Program, YTEP. This year the allocation for that program has been increased as a result of funds made available to us through the Ministry of Employment and Immigration. We have increased the number within the YTEP program by
1,000.	I recognize the number is not that which the hon. lady would wish. It is not the number I would have wished. However, with the amount of money available, those were the plans that were put forward and accepted by the Government.


EXTERNAL AFFAIRS
Mr. Dan Heap (Spadina):: Mr. Speaker, my question is directed to the Minister of International Trade. As the Minister knows, armed conflict is growing in the State of Punjab in India. In particular, about 300 are reported to have been killed yesterday. Travel in and out of the Punjab has been discontinued, and communications interrupted. We in the New Democratic Party are concerned for the many Canadians who are worried over the safety of their relatives in the Punjab. Has the Minister any information on when communications will be restored or whether, in the meanwhile, Canadians can inquire through the Canadian Embassy about the safety of their relatives in the Punjab?


Hon. Gerald Regan (Minister for International Trade):: Mr. Speaker, as the Hon. Member has said, the situation in the Punjab is a very troubled one indeed, and a great many lives have been lost. We are aware of some 50 Canadians who are in the State of Punjab at the present time and of some others who may be travelling in the area. We are not at this time in contact with all of them. There has been a curfew in effect, and communications between Punjab and Delhi have been interrupted. We have no reason to believe that any Canadians
Oral Questions
are in immediate danger, but we are making all appropriate efforts to obtain and maintain contact with those Canadians.


INTERRUPTION IN COMMUNICATIONS
Daniel James Macdonnell Heap: Mr. Speaker, the Minister has answered a question I did not ask, but I was going to ask it next. I would like to return to my original question which goes beyond the one he answered. There are Canadians, not those travelling in the Punjab, but those who have relatives there who are anxious and would like to make inquiry, and are prevented because communications have been interrupted in the State of Punjab by the Government of India during a state of emergency. Is it possible for Canadians with relatives there, not necessarily travelling but living there, to inquire through the Canadian embassy about the safety of their relatives?


Gerald Augustine Regan: Mr. Speaker, it is certainly possible to make those inquiries. Our High Commission will certainly do its best to provide information when it is available. It is our feeling that, when the curfew is lifted, Canadians who do not have urgent reasons for being in the Punjab should leave that area.
Until communications are re-established with the Punjab, we are in the position of not being able to give any detailed information about Canadians who happen to be there at the present time. The Hon. Member can be assured that our competent consular officials are available to provide any assistance that may be needed just as soon as communications are established.


CANADA SPORTS POOL CORPORATION-CONTRACT INFORMATION
Mr. John Bosley (Don Valley West):: Mr. Speaker, my question is directed to the Minister of State for Fitness and Amateur Sport. He will know that today the press has reported what the retailers have been saying for some time, and that is that sales for sports pool tickets are going terribly, and that in fact some retailers are saying that the game has struck out.
Will the Minister finally table in the House the list of people who have contracts with the sports pool, so that we may know who the distributors are and whether in fact they have two-year severance pay contracts, and so that the people in the real world of amateur sport will know whether or not, if this pool fails, it is only Liberals and their friends who will benefit from its existence?


Joseph Mario Jacques Olivier: Mr. Speaker, I must say I am glad the Hon. Member is asking this question while I am in the House,

June 7, 1984
Petitions
because as a rule he seems to wait until I have left to ask his questions. Mr. Speaker, I should like the House to know that the Canadian Sports Pool Corporation has now 70 permanent employees who have been hired following interviews by an independent organization, the Chairman of the Corporation or a group of people.
The Corporation has also some 300 term employees, chosen among all those who had replied to ads placed in local papers by the regional directors of the Corporation. I can state emphatically that there has been no patronage. Distributors have yet to be appointed!


Mr. Speaker:: A short supplementary question.


REQUEST THAT MINISTER TABLE LIST OF CONTRACTS
John William Bosley: Mr. Speaker, the Minister knows full well that the regional directors and agents have been informed that distributors are now to be given five free tickets for every 20 they buy. The thing is a disaster. If the Minister is so convinced of the innocence of the situation, will he undertake to table the full list of contracts so that Members of the House of Commons can discover the real truth?
[ Translation]


Joseph Mario Jacques Olivier: Clearly, Mr. Speaker, the Hon. Member opposite refuses to understand. I must repeat, therefore, that 300 term employees have been hired following a series of ads placed in local newspapers throughout Canada. Whether these people were Conservative, Liberal or NDP supporters, has not and will not be taken into account.
I should like to ask the Hon. Member the following question: Has Air Canada, the CNR, or any other agency such as Loto-Quebec or Wintario ever tabled their list in their respective legislative assembly? That is my question. When he gave $500 million to the provinces, was it a gift he was making to his Progressive Conservative friends in exchange for the $35 million which may not make it possible for us to assume the full costs of the Olympic Games in Calgary? This man is trying to destroy a scheme which could possibly finance these games. He is working against the Western people and against amateur sport in Canada, not to mention medical research, etc.! The underlying philosophy is that a national government should be able to help its athletes.


PETITIONS
Mr. Speaker:: I have the honour to inform the House that the petitions presented by Hon. Members on Wednesday, June
5, 1984, meet the requirements of the Standing Orders as to form.



COMMISSIONER OF OFFICIAL LANGUAGES


Hon. Yvon Pinard (President of the Privy Council):: Mr. Speaker, after consultations we have reached an agreement and therefore, by unanimous consent, the following motion could now be passed. I move, seconded by the Minister for External Relations (Mr. Pepin):
That, in accordance with Section 19 of An Act respecting the status of the official languages of Canada, Chapter 0-2, Revised Statutes of Canada, 1970, this House approves the appointment of D'Iberville Fortier, Esquire, as Commissioner of Official Languages of Canada.


Mr. Speaker:: Does the Hon. Minister have the unanimous consent of the House to introduce his motion?


Some Hon. Members:: Agreed.


Mr. Speaker:: Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

Ramon John Hnatyshyn: Mr. Speaker, I would like to direct the usual inquiry to the President of the Privy council, the Government House Leader, regarding his intentions with respect to Government business for tomorrow and until next Thursday, with the understanding that next Friday the House will not be sitting because of certain events that will be taking place in the City causing most of us to want to get out of town fast!


Yvon Pinard: Mr. Speaker, in so far as the business of the House is concerned, the first item of business tomorrow will be a Bill that is about to be introduced today in relation to the Cree and Naskapi. The Government will be prepared to allow this Bill to be passed through all stages tomorrow. We are willing to hear from one speaker per Party, but if my colleague would prefer to have more, we would not mind. However, we would like to see this Bill passed through all stages tomorrow. If this happens before the normal hour of adjournment, the back-up legislation will be Bill C-39, the War Veterans Allowance Act, and the second back-up Bill will be Bill C-10, resuming debate on the Divorce Act.
On Monday the first item of business will be Bill C-34, the amendments of the Canada Labour Code, and in this instance we would like to see the Bill sent to the Standing Committee of the House by or before the end of the day. The back-up
June 7, 1984

legislation on Monday will be Bill C-31 dealing with freshwater fish.
Beginning on Tuesday and until Thursday inclusive, the business of the House will be Bill C-36, assuming that it is not disposed of today. If it is, we will resume debate on Bill C-25 regarding the CDIC and then Bill C-10 again regarding the Divorce Act. However, business for next Tuesday, Wednesday and Thursday, like all business, of course, is subject to change, and there is most likely to be a change if Bills are reported from committees.


Ramon John Hnatyshyn: Mr. Speaker, I appreciate hearing the outline of the business of the House. With respect to the proposed Bill relating to the Cree and Naskapi, there were consultations between representatives of the Cree and Naskapi and myself and our spokesperson, the Hon. Member for Brampton-Georgetown, with respect to that Bill. At that time my understanding was that they were in consultation with the group affected. They asked for our co-operation by having the Bill dealt with through second reading and sent to committee for one day's consideration. I have seen the draft Bill. It is one that has been worked on for a great deal of time and one of which we are supportive.
Dealing with the observation made by the Government House Leader that at this point in time we could somehow deal with the Bill through all stages, while I am not saying that we are opposed to that proposition, I am wondering how he now comes to that conclusion when my very clear understanding of my direct discussions with the representatives was that they would prefer to have a second reading debate, one day in committee and then have the Bill come back to the House for an expeditious resolution. Is the Government House Leader in possession of information or facts of which I am not in possession? I am quite prepared to discuss the timetable if that is the case. I do not want to waste the time of the House. However, I am sure that my ears did not deceive me when I had discussions with representatives of that group. I would be interested in knowing precisely the basis on which the Government House Leader now suggests that we go through all stages in one day.


Yvon Pinard: Mr. Speaker, the information which I have comes from the Minister of Indian Affairs and Northern Development who spoke with me this morning. He informed me that the request which was made by the interested people was that the Bill be passed through all stages tomorrow. But if that is not the case, I am sure that the interested people will contact me or the Hon. Member before the House starts debating the Bill tomorrow.
I take note of the generous offer of the Hon. Member that, if that was the wish of the interested people with respect to the Bill, his Party would be prepared to allow the Bill to go through all stages tomorrow. If that is not the case, of course, we would be prepared to allow the Bill to go to committee. However, the proposal for the time being is to pass the Bill through all stages tomorrow.
Business of the House


Ramon John Hnatyshyn: Mr. Speaker, I would simply like to reiterate that we, of course, are supportive of the Bill and want to ensure that the matter receives the proper attention of the House. There is no question that if the Minister of Indian Affairs and Northern Development has had subsequent discussions, I will make it my business to communicate with Chief Billy Diamond and other representatives of the Cree and the Naskapi to ensure that the right thing is done. In view of the fact that there have been discussions with respect to this matter, I would appreciate if in future the Government House Leader could give me an indication of those subsequent discussions. 1 thought that the matter had been made quite clear in the course of discussions which had taken place up to this point. So that there will be no misunderstanding, we are not fooling around and wasting the time of the House. I do not want to play games and I know the Government House Leader does not want to either.


Yvon Pinard: Mr. Speaker, I would like to keep the confidence of the Hon. Member. He is right in saying that maybe I should have told him, but I took it for granted that he knew. The Minister informed me that Mr. Diamond and others had told the Hon. Member that they preferred that the Bill go through all stages tomorrow. There might be a misunderstanding, but the Hon. Member is right in saying that yesterday we had discussions on this matter. I will not refer to the details of the discussions, but it was understood that the Bill would go to committee at the request of the Hon. Member. Our proposal yesterday was to pass the Bill through all stages. I know the Hon. Member is speaking in good faith. I will ensure that whatever the people who are interested in the Bill want, it will be done accordingly tomorrow. In other words, we are proposing to dispose completely of the Bill tomorrow; but if the interested people do not want that to happen, the Bill will be sent to committee. It is no more complicated than that.


Neil Young: Mr. Speaker, I am pleased to hear that the Government has decided to call Bill C-34 respecting amendments to the Labour Code for debate on Monday. I would like to indicate to the Government House Leader that we would be prepared to have the Bill go to committee with one speaker in the House. Also, to repeat the offer of the Hon. Member for Hamilton Mountain which was made last week, we would be prepared to enter into a House order to ensure that the Bill is reported out of committee and back into the House, dealt with and passed by the end of June.


Stan Darling: Mr. Speaker, I am wondering if the Government House Leader has had conversations with the Minister of the Environment regarding the possibility of continuing the Sub-committee on Acid Rain. If he has not, I hope he will look very favourably on the idea of continuing this important committee because of the seriousness of the problem. I know he did when the previous committee fulfilled its mandate. However, I suppose that the mandate of the committee has been completed at this time.

June 7, 1984
Business of the House


Yvon Pinard: Mr. Speaker, I will consider very seriously the request made by the Hon. Member. I will talk to the Minister of the Environment about it. I listened to his answer today, but I will have to discuss it with him and report back to the Hon. Member as quickly as possible.
In so far as Bill C-34 is concerned, we have an understanding among ourselves to have one speaker from the NDP and two from the Conservatives. We were not specific in so far as our Party was concerned. However, Monday is available and the spirit is to allow the Bill to go to committee on Monday. This will be possible so far as we are concerned, but if the Conservative Party wants more than one speaker, that is fine. If the NDP wants more than one speaker, that is fine too. If we want more than one speaker, we will also do so. But we want the Bill to be sent to committee before five o'clock on Monday, and we will not do anything to prevent that from happening.


John Wise: Mr. Speaker, I want to pose a question to the Government House Leader. I respect very much the negotiations that have always been carried on between the Government House Leader, the House Leader of the Official Opposition and the House Leader of the NDP. I raise my question because of the fact that the Government House Leader has really laid before us the legislative program not only for the rest of this week, but indeed the entire program for next week. That is subject to change, of course. As well, I appreciate the fact that the Government House Leader has indicated that there are a number of Bills which are presently before committee.
On May 17 I posed a question to the Government House Leader. At that particular time there was co-operation among all Parties to pass the Prairie Grain Advance Payments Bill which would double advance payments to farmers for commodities falling within the Canadian Wheat Board. We supported that Bill and co-operated with the Government. Indeed, the Bill passed all stages in one day.
I would remind the Government House Leader that as a result of that we have a situation in which advance payments legislation applies in one part of the country and provides $30,000, $60,000 and $90,000 to producers of grains within the Canadian Wheat Board. Indeed, that was a result of the passage of Bill C-23. However, in other parts of the country- Ontario, Quebec, Atlantic Canada and B.C.-the existing advance payments crop legislation, which I believe was passed in the House in 1976, maintains the same levels. Those are the old levels of $15,000, $30,000 and $45,000.
The Minister took my remarks seriously. He indicated that he would have discussions with the Minister of Agriculture. I do not want to quote the Minister, but he indicated that he would have a conversation with the Minister of Agriculture and, indeed, if anything could be done it would be done. It is now June 7 and we have a legislative program which deals with this week and next week, but there is no mention of that Bill.
The second problem might well be more serious than the first problem, and I raise this question in all sincerity. There exists in southwestern Ontario a very serious problem in the tobacco industry. The tobacco farmers have been led to believe that a national marketing board would be established to negotiate on their behalf and to market the 1984 crop. Indications were given to various board members and growers as early as the Agricultural Outlook Conference which was held in December that the necessary amendments to the Farm Products Marketing Agencies Act would be introduced into the House in February. The Minister of Agriculture, in so many words, led people to believe that the Act would be introduced in the House by March 15.
I questioned the wisdom of those statements at that time, but I thought that if the Minister wanted to hold out false hopes he could do so. I would have preferred him to have been more honest, more forthright and more realistic to the board and to the growers. Indeed, they were led to believe that the amendments to the Farm Products Marketing Agencies Act would allow the board to establish a national board and that it would be introduced in the House today. It has not been introduced in the House today and I doubt very much whether it will be introduced.
I would like to impress upon the Government House Leader that it is a very serious situation which applies-


Mr. Speaker:: The Chair hesitates to interrupt the Hon. Member, but if he has a question relating to House business, the Chair invites him to put his question.


John Wise: I will follow your advice, Mr. Speaker. I could go on and talk about this very serious problem for hours. However, I would be happy to have some private discussions with the Government House Leader. I believe the Minister of Agriculture is away for some time on official duties. I just want to impress upon him the fact that commitments have been made, deadlines set, and the commitments are unfulfilled and the deadlines are passing. It is a serious problem. When can we expect the introduction of the necessary amendments to the Farm Products Marketing Agencies Act which would allow the growers to decide whether or not a national board is in their interest?


Yvon Pinard: The Hon. Member raises two concerns. His first concern has been brought to the attention of the Minister of Agriculture. As Government House leader I deal with Bills on the Order Paper; obviously in this instance the Bill has not yet been introduced and I do not know if it will be introduced in the next week, before the end of June or when the session resumes next fall; I cannot tell the Hon. Member. But if ever we introduce a Bill on this important matter, I hope that it will be disposed of very quickly, probably with one speaker per Party, and that we will consider the speech for the Conservative Party will have been delivered today by the Hon. Member.


Some Hon. Members:: Oh, oh!


Ramon John Hnatyshyn: And it was a heck of a good speech, too.
June 7, 1984


Yvon Pinard: On the second concern, the Bill will be introduced once the policy has been approved by Cabinet. I must tell the Hon. Member that the representations he has just made to me were also made by what I call the interested people, and by many Liberal Members last week, the week before and months before. Those representations are well known to me and I will make sure the Minister of Agriculture knows exactly what has to be done.
Once again, there are only three weeks left before the summer adjournment and some Bills will have to be disposed of. If a Bill was to be introduced to deal with this matter, obviously it would have to be dealt with very quickly. There again, I hope the Hon. Member would agree to refrain from speaking again since he has done so today.


Mr. Mayer:: Mr. Speaker, I can assure the Government House Leader that we will be prepared to deal very quickly with legislation affecting tobacco growers once the Government brings it forward.
Is the Minister aware of any intention by the Government or the Minister of Agriculture to introduce amendments to the Agricultural Stabilization Act which will allow for the creation of a tri-partite stabilization program in the red meat industry? The Minister is on record as saying he had it approved in principle by Cabinet back in April and he wants agreement with some of the provinces by July 1. He will not be able to do that unless we have amendments to the Agricultural Stabilization Act. Is there any intention to bring that legislation forward so that we can deal with it very quickly before the end of this month?


Yvon Pinard: I will take good note of the representations made by the Hon. Member.


Laverne Lewycky: Mr. Speaker, can the House Leader give us some indication whether the Minister of State for Multicultur-alism intends to bring down legislation concerning the mul-ticulturalism Act proposed in the Speech from the Throne? I did not hear the House Leader comment on that, so can he indicate whether we can expect to see it before the House rises on June 29?


Yvon Pinard: Most likely, Mr. Speaker.



ROUTINE PROCEEDINGS


Gordon Edward Taylor: for leave to introduce Bill C-245, an Act to amend the Holidays Act.


Mr. Speaker:: Is it the pleasure of the House that the Hon. Member shall have leave to introduce the Bill?
Introduction of Bills


Some Hon. Members:: Agreed.


Gordon Edward Taylor: Mr. Speaker, I have great pleasure in moving first reading of this Bill. Constitutional independence of Canada was achieved on April 17, 1982 by the proclamation of the Canada Act. This day will, therefore, under this Bill, be celebrated in the future as Canada Day. It will also restore July 1 as Dominion Day, as July 1 marks the beginning of the Dominion of Canada as it was known in 1867. This historical fact is so important that it is appropriate to retain July 1 as Dominion Day.


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


Some Hon. Members:: Agreed.


CREE-NASKAPI (OF QUEBEC) ACT MEASURE TO ESTABLISH
Yvon Pinard: for leave to introduce Bill C-46, An Act respecting certain provisions of the James Bay and Northern Quebec Agreement and the Northeastern Quebec Agreement relating principally to Cree and Naskapi local government and to the land regime governing Category IA and Category IA-N land.


Mr. Speaker:: Does the Minister have leave to introduce the Bill?


Some Hon. Members:: Agreed.


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


Some Hon. Members:: Agreed.


Mr. Speaker:: The President of the Privy Council, on a point of order.


Yvon Pinard: Mr. Speaker, I think the Minister on my right would like to have the unanimous consent of the House to revert to Tabling of Documents, because she forgot she had something to table.


Mr. Speaker:: Is there unanimous consent that we revert to Tabling of Documents?


Some Hon. Members:: Agreed.

June 7, 1984
Order Paper Questions


TABLING OF STATISTICAL STUDY ON YOUNG PEOPLE IN CANADA
Céline Hervieux-Payette: Mr. Speaker, pursuant to Standing Order 46(2), I wish to table a report entitled "Focus on Youth" and a study entitled "A New Statistical Perspective on Youth in Canada".

\ English]


INCOME TAX
Roy MacLaren: the first reading of Bill S-ll (from the Senate), an Act to implement conventions between Canada and the Republic of Tunisia, Canada and the People's Republic of Bangladesh, Canada and the United Republic of Cameroon, Canada and the democratic socialist Republic of Sri Lanka, an agreement between Canada and Kenya, conventions between Canada and the Arab Republic of Egypt, Canada and the Republic of the Ivory Coast, Canada and Sweden, for the avoidance of double taxation with respect to income tax.
Motion agreed to and Bill read the first time.


Mr. Speaker:: When shall the Bill be read a second time, at the next sitting of the House?
tional Development Agency and by the Department of National Revenue as follows:
1.	CIDA contributed the following amounts to the International Defence and Aid Fund for Southern Africa of Ottawa as follows:
(a)	-1982-83 (through the Public Participation Program of the Non-Governmental Organizations Division) $9,000, for development education projects.
1983	(through the International Non-Governmental Organizations Division to the international association of IDAFSA based in London, England), $3,000, which was the final payment for an earlier project run by Christian Care in Zimbabwe to help settle former political detainees and their families through training in chicken farming, vegetable gardening as well as small settlement grants.
(b)	1983-84 (through the Public Participation Program of the Non-Governmental organizations Division), $22,000, for development education projects.
1984	(through the Non-Governmental Organizations Division) $47,025, of the total CIDA commitment of $49,500. was contributed for Self Help and Development Projects in Zimbabwe.
2.	No.


Mr. Evans:: I ask, Mr. Speaker, that the remaining questions be allowed to stand.


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


Some Hon. Members:: Agreed.


QUESTION ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
John Leslie Evans: Mr. Speaker, the following question will be answered today: No. 800.


CIDA-GRANTS TO INTERNATIONAL DEFENCE AND AID FUND FOR SOUTHERN AFRICA OF OTTAWA
Mr. Stewart: 1.	In (a) 1983 (b) 1984 to date, did the Canadian International Development Agency grant any money to the International Defence and Aid Fund for Southern Africa of Ottawa and, if so, in each case, what amount was granted and for what purposes were the funds granted?
2.	Is the International Defence and Aid Fund for Southern Africa a registered charity?


John Leslie Evans: I am informed by the Canadian Interna-


Mr. McKinnon:: Mr. Speaker, this question of mine comes around about as regularly as the Thursday question on House business. I would like to point out that I have had question No. 368 on the Order Paper for over three years. It requires a simple answer. I fully believe that the reason it is not answered is that the answer would embarrass the Minister of National Defence, who has been deceiving the House and the country about the increases in the National Defence budget.
As this question is over three years old, Mr. Speaker, I put another question of a similar nature on the Order Paper bringing it up to date. My first question, No. 368, asked for the returns from 1971 to 1979-80. I have tabled a new question on the Order Paper, No. 840, which requests the returns from 1970-71 to 1983-84.1 think that in the interest of the tidiness of the Order Paper it might be appropriate, if I can get unanimous consent of the House, to cancel that question about which there has been procrastination for over three years.


Mr. Speaker:: By agreement, can the Hon. Member for Victoria (Mr. McKinnon) withdraw his question from the Order Paper?


Some Hon. Members:: Agreed.
June 7, 1984


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


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. MacLaren that Bill C-36, an Act to amend the Interest Act, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Dave Nickerson: Mr. Speaker, if I recall correctly, when I left off speaking immediately before lunch I was discussing some of the new wording in what will be the new Section 6 of the Act. It deals with the possibility of fluctuating principal amounts within mortgages. Presumably the principal amount will be re-assessed periodically in light of the inflation that has taken place. This new section also contemplates fluctuating interest rates on mortgages. With the advent of computers and everything else we have today it is not unlikely, and we can foresee such circumstances, that the interest rate on a mortgage may fluctuate on a daily basis. Taking into account today's increase in inflation, the principal may be re-adjusted at the same time.
In the mortgage business, whether it is mortgages for residential houses or for industrial and commercial purposes, surely we should have stability. We are getting further away from the stability which we had until the present Government came into power. Instability in financial matters has characterized the Liberal administration of the last many years. Everything appears to be in a constant state of flux. It is very difficult for one to plan financial affairs when the Government appears to be unconcerned with financial and economic matters.
The preoccupation of the Liberal Government under the current Prime Minister (Mr. Trudeau) has certainly not been with economic and financial affairs. These have been neglected and relegated to the back-burner. The Government, and Parliament as a consequence, has been concerned with philosophical ideas concerning constitutions. We have had great debates on bilingualism. We have engaged in all manner of social engineering, but we have neglected financial stability for the nation. That is one of the reasons we are in the sad and sorry state we are in today.
Today in Question Period the Minister of State for Finance (Mr. MacLaren) stated that there is nothing Canada can do about interest rates in the country. They are all a function of what someone else does in some other part of the world, the United States in particular. I do not buy that idea. I think that
Interest Act
Canada is capable of conducting its own affairs and engendering a stable economic climate in the country. Instead of tagging on to someone else with regard to interest rate matters, this would allow us to set the trend, or at least to have that degree of stability which we need in Canada if we are to encourage residential, industrial and commercial borrowing for the purpose of new capital construction in Canada. We should have control over our own state of affairs in the financial field.
I will address another aspect of this Bill. Why do we need legislation of this kind? Why can we not just leave it up to the market and negotiations between borrowers and lenders? The reason is that there is always an unequal balance of power between the lender and the borrower. Anyone who has had experience in negotiating a mortgage, especially in the case of a residential mortgage, knows that you do not engage in real negotiation. You may try to shop around a little to get a better rate. That is about the best you can do. The mortgagors are almost invariably obliged to sign a standard printed document which is drawn up by the mortgagees, almost invariably in their favour. They have the benefit of all kinds of legal counsel. The drafting is done to protect the interests of the lender. Were it not for Parliament and legislation such as the Interest Act, the borrower would have very little to protect him or her.
It is up to Parliament, through legislation such as this, to protect the interests of the borrower and also to provide a fair and equitable system for both the lenders and the borrowers. It is a disappointment that the present Government does not seem to share this sense of equity. It appears to be more concerned with the interests of the financial institutions. We will see this when we discuss the provisions in greater detail. The Government seems to be much more concerned with the interests of the financial institutions and not concerned at all with the interests of the borrowers.
It is desirable, if circumstances change and people have the financial wherewithal, that they be able to discharge a mortgage as soon as possible. Many people would want to do that if interest rates are either high or low. It might make very good financial sense when interest rates are high, but most people, whatever the rate of interest charged on that mortgage may be, would want to be free and clear of it. They would want to obtain their financial freedom.
The House will recall the mortgage burning ceremonies that were popular at one time. This was done once the mortgage had been discharged and people had that burden off their back. It is a common objective and something we should encourage by making provisions to enable people to discharge their mortgage in advance of the original date set in the original mortgage.
In enabling this to be done, and to be fair to the lender, there must be some form of penalty imposed if an early payment is to be made. If the principal is reloaned by the lender at a lower rate than that prevailing at the time of the

June 7, 1984
Interest Act
negotiation of the original mortgage, there is a reduction in income or earnings by the mortgagee, that should be taken into account. Of course, there is the overhead cost of making new loans. That also must be taken into account.
Our aims, when designing a prepayment scheme, should be threefold. First, there should be an element of fairness to which I referred before. Second, there should be simplicity and clarity which I do not think exists in the Bill before us today. It should be something that everyone can understand, and it should not contain long, weird and wonderful financial formulae. It should be written in such a way that everyone can understand it. There should be certainty about it. That certainty does not exist in the scheme that has been proposed by the Government.
The traditional way of doing this has been to assess the penalty in terms of the number of months of interest payments. The provisions of the old Act with respect to certain mortgages was that the penalty that was payable if one wanted to pay off the mortgage was some three months' interest. This was understood by everyone. It is sure, simple and understandable. It might not be absolutely equitable under every circumstance, but in order to get that simplicity and certainty perhaps it is necessary to give up a little of the fairness.
I hope that we can again approach the question of prepayment penalties in the same way. I see no necessity for changing from the traditional, simple, reasonably fair and sure system. But apparently this is not the Government's approach. If there is an easy way of doing something and a difficult way of doing something, you can bet your bottom dollar that the Liberals will take the difficult way. Just look at their approach to this Bill. Primarily, they have a great desire for regulations. If action can be taken through regulations, in secret and behind closed doors, that is what the Liberals will do. Practically everything concerning prepayment of mortgages is to be done by regulation with that aura of secrecy about it. You can also bet your bottom dollar that when the regulations do see the light of day, they will probably be 25 pages in length. I guarantee that no ordinary Canadian will be able to understand what those regulations mean. They will be complex, and the Liberals love complexity because they can hide behind it.
I cannot see any advantage to the mortgagor at all under the government proposals. Let us explain those proposals in general. When a mortgage is to be surrendered or paid up, one takes the present value at the old rate, which will normally be higher than the new rate, and computes the present value of the rate under existing interest rates on the day of surrender. The second is subtracted from the first, with the resulting sum of money which is to be payable by the mortgagor to the mortgagee. This system was described by the Hon. Member for Mississauga South (Mr. Blenkarn) as a henhouse designed by foxes. That is certainly what it is. It is entirely in favour of the financial institutions. It is not fair to the mortgage borrowers of Canada.
It is complex and difficult to understand. When the rates go up, the borrower is obliged to pay the going rate. When the rates go down, the penalty is assessed in such a manner as to
wipe out any advantage the borrower might otherwise have had with a decline of interest rates.
This Bill is so clouded, so obscure and so unfair that I can only conclude that it has been drafted by one of the Liberal candidates for the leadership, that is, by Mr. John Turner. That is where I suspect this Bill originated.


Mr. Deputy Speaker:: Are there questions or comments?


Donald Alex Blenkarn: Mr. Speaker, I have a question for the Hon. Member for the Western Arctic (Mr. Nickerson). The press releases delivered by the Government indicate that mortgages of $150,000 or less will have this maximum penalty on their predischarge. Has the Hon. Member been able to find any reference to $150,000 in the Bill? I have gone through the Bill and cannot find any such reference. It seems to me that the Government, in presenting this Bill to the press and to others, has deliberately misled the public and the House with respect to any prepayment arrangements. Would the Hon. Member care to comment on that?


Dave Nickerson: Mr. Speaker, I too have read the Bill. I can find no such reference in the Bill. It is possible that the Government may wish to address this in the regulations. If that is indeed the case, we do not know if the figure will be $ 150,000 or whatever else it might be.
However, this just goes to illustrate some of the comments I was making in my formal presentation. It illustrates the obscurity with which the House has always been faced by Members on the Government side. It is what one might call government by press release. On how many similar occasions has something been made known in a press release and then the content of that press release has never in fact materialized?
A subject which is not really related but one about which I am very concerned at the present time involves press releases in 1980 and 1981 put out by the Minister of Indian Affairs and Northern Development (Mr. Munro). He stated that many millions of dollars were going to be made available for training opportunities at the time of the construction of the Norman Wells pipeline. These moneys have never seen the light of day. That is just an indication of how the Government manipulates by press release and does not come forward with legislation in what it professes.


Donald Alex Blenkarn: Mr. Speaker, in the same press release the Government gives an example of the kind of penalty that would be charged to a consumer. Suppose a consumer takes out a five-year $50,000 mortgage at the rate of 12 per cent which is to be amortized over 25 years. Suppose that, with two years remaining in the term of the mortgage and a market rate of 9 per cent, the consumer wishes to repay it. The maximum penalty could be assessed, it was worked out, to $2,538.23. I went to the Ministry of Finance and asked people there how they worked it out. I gave them a $50,000 mortgage at 18 per cent, the current market rate being 13 per cent, with two years to go. They told me I should ask the Minister. Has the Hon. Member for the Western Arctic (Mr. Nickerson) any idea
June 7, 1984

how the Ministry of Finance could conceivably come up with this computation, on the mortgage suggested, of $2,538.23, or is this another illustration of deliberate misrepresentation by a government that refuses to put up any speakers in debate so the Government can not in any way be questioned as to the nature and terms of a Bill?


Dave Nickerson: Mr. Speaker, I must say I fully subscribe to the observations made by the Hon. Member for Mississauga South (Mr. Blenkarn). I do not know how that computation was made. No one really knows how it was made because there are no regulations which give the complex formulae to be incorporated in the Bill. It is impossible for anybody really to know at the time of public debate in the House of Commons on this Bill how it will affect him or her and what penalties will be assessed upon the early discharge of a mortgage.


Mr. Deputy Speaker:: Debate.


Mr. Deputy Speaker:: Debate? Questions? The Hon. Member for Temiscamingue (Mr. Tousignant), for questions or comments.


Mr. Tousignant:: Mr. Speaker, I would like to comment briefly on what was said by the Hon. Member opposite. Quite frankly, I must admit I was amazed at the contradictions in his comments, and at the way he contradicted the policies of his own party. When the Hon. Member said that:

"We should have control over our own affairs".

Every time this Government has wanted to take control of its own affairs, those people over there were shocked, they shouted and they let the bells ring! I am surprised at such statements. When the Hon. Member says that the Government wasted its time on constitutional matters and on language issues . . . Mr. Speaker, I am speechless! Are these people going to tell Canadians in an election campaign that what was done for this country, the very essence of being Canadian ... are these people going to say this kind of thing publicly in their election campaign? I am absolutely dumbfounded! While the Government approached these issues responsibly and bravely, they could and would never have done so! And at the same time, the Government conducted the affairs of State. Yes, we did have an economic slowdown, as did all other countries. If the Progressive Conservatives had been in power, Mr. Speaker, it would have been a disaster! People with no experience, who would have lost control completely! And now they are telling us that we ignored the economic issues.
When I hear the Hon. Member opposite saying that- [English]
"The interest of the Government is more with the financial institutions".
Interest Act

Imagine hearing such words from a Member on the opposite side of the House! How can we believe statements that contradict the very policies of his Party, a Party that is dedicated to the interests of the big financial institutions? And now they are saying that the Government is in bed with big business!
Mr. Speaker, if that is how he looks at things, perhaps the Hon. Member opposite should cross the floor and sit on this side of the House, because he is certainly not going to feel comfortable with Members of his own Party. Mr. Speaker, these people are speaking out of both sides of their mouths at once, and just to kill time, too! Other Members were saying that nobody was speaking on this side of the House. We do not have to be convinced, we already are. And we do not have to make all kinds of false accusations, like the Members opposite are doing.
Mr. Speaker, we know this Bill is a good Bill. We know that Canadians are anxious to see it pass, and we do not really have to try to convince our friends opposite.


Donald Alex Blenkarn: Mr. Speaker, I have a question for the Hon. Member for Temiscamingue.


Mr. Deputy Speaker:: Order, please. The Hon. Member for Temiscamingue was recognized for a question or a comment. The Hon. Member for the Western Arctic (Mr. Nickerson), to whom the comment was addressed, is not in the House now. In any event, the Hon. Member may make a general statement pertaining to the remarks of the Hon. Member for Western Arctic even though the latter is not here. There is only one minute left in the period allowed for questions.


Donald Alex Blenkarn: Mr. Speaker, I was of the opinion that the Hon. Member had risen to speak in debate, and we were quite pleased to see him rise in debate. It is about time that this House of Commons had a Member of Parliament from the other side speak in debate.


Mr. Deputy Speaker:: Order, please.


Henri Tousignant: Mr. Speaker, I rise on a point of order. The Hon. Member does not respect the House. I was commenting on the speech. The Hon. Member also can comment on that speech. He does not have to stand up and make another speech or ask questions of me.


Mr. Deputy Speaker:: Order, please. I will help resolve that matter. The time allotted for questions has expired. We will now proceed with debate. The Hon. Member for Burlington (Mr. Kempling).


Mr. Bill Kempling (Burlington):: Mr. Speaker, the Interest Act has been around for a long while. It was passed in its original form in 1880 and portions of it were around prior to Confederation, I am told, as early as 1840.
The part of the Bill which has attracted a lot of interest is Section 10. The Bill purports to amend Section 10 and make

June 7, 1984
Interest Act
some changes, with which we are not very impressed. Section 10 in its present form purports to allow a person to prepay a mortgage on the payment of a three-month interest penalty after the mortgage has been in effect for five years. Essentially, that is what Section 10 does. The penalty was put in there to reimburse the lender or the mortgagor for expenses he may have to meet as a result of prepaying the mortgage after the five year period. A number of my colleagues who have been in the legal profession for a number of years and bankers and others who have dealt with mortgages whom I have consulted have told me that this was not always the case. I discussed this matter with an old-time bank manager, and he said that they did not always collect that three-month interest. If the client was a good customer of the bank, in many cases the bank waived that interest. Many of my friends in caucus who are in the legal profession have told me the same thing, that it would depend upon the individual, the circumstances, the amount, and the terms. But in many cases if the person was going to remortgage with the same institution, the three-month interest was waived.
What we are doing now is sort of institutionalizing this matter. We are saying that the penalty is now going to be the interest differential between the new rate and the old rate. That is the part that has upset many of us. I should point out at the outset that the Standing Committee on Regulations and other Statutory Instruments has had a look at Bill C-36, particularly at Clause 11.1. Clause 11.1 reads:
Sections 10 and 11 do not apply in such circumstances as are prescribed by regulation.
This enabling power does not indicate in general terms when the operation of Section 10 and Section 11 will be suspended. Given that the power being delegated is effectively that of amending an Act of Parliament by regulation-and that is what it does-I do not think that we as a responsible political Party can allow that to happen. We did not come to Parliament to pass legislation which would be subsequently amended by Order in Council. That is not the purpose of Parliament. The Standing Committee on Regulations and Other Statutory Instruments has raised this matter. It will be pursued within that committee. Certainly we will pursue it if the Bill is passed on to committee for consideration, the calling of witnesses and all that that entails. The major portion of the Bill before us, the section which the Government wants to amend, is under attack.
I should like to refer to the conduct of some people in the mortgage business over the past few years. On numerous occasions I have risen in the House on this entire matter. I directed questions to the Minister of Finance (Mr. Lalonde), to the Minister responsible for housing and to the Minister of Consumer and Corporate Affairs (Mrs. Erola). I asked them what they would do about interest differential charges. In my wildest dreams I did not believe that they would institutionalize them or that they would put them in a statute and say that the mortgagor must pay the interest differential charges. I just
could not believe that would happen, but that is the way I read this Bill.
The reason I become interested in this subject matter is that numerous constituents wrote to me about it. As I said, I raised it with the Minister of Consumer and Corporate Affairs, the Minister of Finance and others. They replied by indicating that they were very upset and concerned about it and that something should be done. The Minister of Finance said that he had spoken to the financial institutions. He did not like the way in which they were operating and indicated that there should not be an interest differential charge. He said that a three-month interest penalty was adequate, and the Minister of Consumer and Corporate Affairs said the same.
I also brought to the attention of the House the fact that
750,000	Canadians across the country were trapped into mortgages with interest rates as high as 22 per cent. I also brought to the attention of the House the fact that 30 per cent of the homes were on the Hamilton real estate market-and I do not know about the other markets-in late 1982 and early 1983 as a result of foreclosures because of high interest rates. I was looking for confirmation of the comments of the Minister of Finance, the Minister of Consumer and Corporate Affairs and the Minister responsible for housing and CMHC. In their compassionate way they implied that they would do something for home owners, for people caught in high interest rate mortgages. When I saw this legislation, I saw nothing for them at all. All they are doing is saying to the mortgage companies that they can charge penalties on the differential in the interest rate between the new and the old rate. In effect, that is what they are saying, and they made it law. I cannot believe that we should sit here and allow this to happen.
I had hoped that they would come before the House and say that they would make Section 10 of the Interest Act work. Half a dozen of the large trust companies are the main offenders, but everyone else follows suit. There is a herd instinct when it comes to making a buck. I thought they would say that if those fellows wanted the legislation regulating trust companies to be amended and to be allowed to enter into other fields of finance, to expand their operations, to be given more leverage and to obtain everything else they were requesting, they would have to abide by the rules of the land. I expected them to say that trust companies would have to abide by Section 10 of the Interest Act and by the provincial statutes in place in Ontario and Manitoba which cover the same circumstances as Section 10. That is what I expected to see, but I do not see it at all. I am disappointed that that initiative was not put forward by one of the three Ministers who have been questioned over a period of time on this matter.
In order to understand the full impact of what has been happening, we should examine how these people found a way around Section 10 of the Interest Act. We should see the way in which they manoeuvred and manipulated. First, they attacked the five-year period in that section. When a person went in for a mortgage renewal, they were led to believe that the renewal document was in effect starting the clock on the five-year period all over again. That is what people were told;
June 7, 1984

that is what was implied. They were told that they did not have a five-year mortgage because it was renewed last year, which started the clock on the five years over again. That is crazy; if persons renewed their mortgages evey three years, they could never get to five years. Someone inevitably tested the matter in the Supreme Court of British Columbia. That court ruled that a renewal of a mortgage is just that, that it does not start the five-year clock all over again.


An Hon. Member:: Is that right?


William James Kempling: Yes, that is what the court ruled. What did the trust companies and some of the large mortgage operators do?


Mr. Gamble:: They pulled out their hair.


William James Kempling: No, they found a way around it. They included a clause in their mortgage renewal contracts which indicated that the signing of that document started the clock all over again. It was like redating the mortgage back to year one. When we asked the Minister of Consumer and Corporate Affairs about that, her reply was: "A contract is a contract is a contract".
If institutions and corporate bodies can take a statute of the Parliament of Canada and statutes of the provincial legislatures and circumvent them in that manner, and nothing happens to them, what will happen to legislation in general? For example, what would happen if someone wanted to sell me a set of automobile tires but did not comply with the Motor Vehicle Safety Act? For the sake of discussion, suppose that I was told that I could purchase these tires but that I would have to sign a document which waived my rights to any protection under that Act? If it happens under one piece of legislation, it could happen under others. What has incensed me and angered me about the whole matter is the manner in which some of these people have cavalierly walked over mortgagors in this country. I am sure we still have 600,000 people with high interest rate mortgages who went along on the basis that the three Ministers would provide some relief from their difficulties, and they will receive nothing at all.
In essence, the Bill before us says that they can prepay their mortgages but, according to the proposed change to the statute, they will now have to pay the interest differential total for the full term of the mortgages. The five-year period is now something of the past. The reason given for the five-year period being waived is that it will encourage long-term mortgages. Have Hon. Members ever heard anything more ridiculous than that? The Government will not encourage long-term mortgages by taking away the rights of individuals.
I should like to refer to another portion of an average mortgage renewal document. It was drafted on the corporate side by a guy who really knew how to use weasel words. In the mortgage renewal document he says: "You waive your rights under Section 10 of the Canada Interest Act or any similar provincial statute that is now in place or may come into place in the future, or in other words forever, so that we can charge you the full interest for the full term of the mortgage".
Interest Act
What was their objective? I can tell you what it was. Anybody who thinks about it will realize what it was. Interest rates were going up. The highest mortgage rate that I saw during that tragic period was 22.5 per cent. Some trust companies, and if they did not do it they were foolish, looked over their mortgage portfolio and said: "My God, if these mortgages are paid to term, we have hit the mother lode. It's bonanza time. Our objective has to be to somehow or other get the mortgagees to hold these mortgages to term and, if we can, it's going to be a windfall in profits". You just have to look at their balance sheet for 1983 and 1984 and you will see it all there. They hit the windfall and they hit it big. They hit the mother lode. They designed a tactic. When the mortgagees came in to renew, they gave him 30 days' notice. They sent the notice by mail. With the mail delivery we have in this country, they lost ten days. Only 20 days were left. They told the mortgagee that if he wants to pay it out, they have to pay the interest differential charge. The average that came through my office was an $8,000 or $9,000 penalty. They were thunderstruck by this and tried to find another trust company in order to get a mortgage. Time was shorter and shorter and, eventually, they had to sign. They had no alternative; either lose the house or sign. That is the way they operated. That is the way they forced many of these people to hold their mortgages to full term. They would not comply with the law of the land. This Government did not have the courage or the guts to make them stand up and do it. They yielded and bent to them. I can see the fine hand of some of the lobbyists written into the pages of this Bill.
We in this country should be moving to see that everyone who wishes to own a home, and has the reasonable expectation of being able to pay for it, should be able to have that wish. No other segment of our economy responds quicker than the house-building industry. Just look at the spin-off effect in the appliance industry and other parts of our economy such as lumber, transportation and the various trades involved in house construction. We see the tremendous engine it is to keep our economy going.
This Bill will not do anything to help homeowners. 1 am not impressed, particularly when our Standing Committee on Regulations and Other Statutory Instruments pointed out that we are delegating to the Governor in Council the right to amend an Act of Parliament without reference to Parliament. That is something we have to stand against, both now and in committee. Unless it is amended, we will fight very hard in committee to see that it does not go through.
My colleague from Mississauga South pointed out the situation. It was set forth in the information release put out by the Government. I might just read it into the record. It reads:
As an example of what a maximum penalty would be, consider a situation in which a consumer takes out a five-year $50,000 mortgage at an interest rate of 12 per cent which is to be amortized over 25 years. Suppose further that with two years remaining in the term of the mortgage and a market interest rate of 9 per cent he wishes to prepay the mortgage. The maximum penalty which he could be assessed would work out to $2,538.

June 7, 1984
Message from the Senate
My colleague called the Department of Finance. He said that it did not seem right to him, and asked what the penalty would be on a $50,000 mortgage with three years to go if the interest rate were 18 per cent and were going to be remortgaged at 13 per cent. They replied that they could not figure out how the interest rate quoted in the Government information bulletin had been figured out. They had no idea how to calculate the request that he put to them for a 5 per cent drop in interest rates on a $50,000 mortgage with three years to run. They just could not do it. If I read carefully the reference they made, the error was that the $2,538 referred to in the Government release is principal and interest over three months and not just interest only. If it is interest only, it means they are paying $800 a month in interest. I cannot imagine that.
I am getting near the end of the time allowed me in this debate. I thank you, Mr. Speaker, for your courtesy. I just want to say that I certainly do not approve of this Bill. I cannot believe that we are going to pass it in its present form. If it does go by, it will certainly be with a lot of debate. When it gets to committee, we will have a lot to say.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: It is my duty, pursuant to Standing Order 45, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the Hon. Member for Trinity (Miss Nicholson)-Immigration-Refusal of visitors' visas to applicants denied landed immigrant status; the Hon. Member for Western Arctic (Mr. Nickerson)-Environmental Affairs-Oil drilling in Lancaster Sound-Government policy inquiry, (b) Minister's advice; the Hon. Member for York North (Mr. Gamble)-Energy-Removal of Ontario radioactive waste, (b) Responsibility for permanent storage.


MESSAGE FROM THE SENATE
Mr. Deputy Speaker:: I have the Honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed Bill S-15, An Act to provide for the creation by amalgamation of the Wesleyan Church of Canada, to which the concurrence of this House is desired.

I have also the honour to inform the House that a message has been received from the Senate informing the House that
the Senate has passed Bill C-241, An Act to amend the Senate and House of Commons Act, without amendment.
Another message has also been received from the Senate informing the House that the Senate has passed Bill C-45, An Act for granting Her Majesty certain sums of money for the Government of Canada for the financial year ending the 31st March, 1985.



THE ROYAL ASSENT

['Order, please. I believe that there has been a communication. Would the Hon. Member please resume his seat.']
Mr. Deputy Speaker:: I have the honour to inform the House that a communication has been received, which is as follows:
Government House Ottawa
7 June, 1984 Sir,
I have the honour to inform you that the Right Honourable Brian Dickson, Chief Justice of Canada, in his capacity as Deputy Governor General, will proceed to the Senate Chamber today, the seventh day of June, 1984, at 4.30 p.m. for the purpose of giving Royal Assent to certain Bills.
I have the honour to be,
Sir,
Your obedient servant,
Edmond Joly de Lotbiniere Administrative Secretary to the Governor General.



[Stage Direction]
The House resumed consideration of the motion of Mr. MacLaren that Bill C-36, an Act to amend the Interest Act, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Mr. Deputy Speaker:: Order. The House will now proceed to a 10-minute question period for comments and questions, if need be.


John Albert Gamble: real effect of that is something more than a simple amendment. It is indeed a repeal. I am delighted that the Hon. Member has referred to this issue because we are being confronted with the repeal of sections which would be renumbered Sections 10 and 11 of the Interest Act.
If we believe in the process, then Parliament, assuming that the Liberal majority in the House has its way, will provide under Section 10 of the Interest Act that interest is not payable on a variable principal increase in a mortgage amount. We are also told that in the event that Clause 11 passes, interest will not be paid which would otherwise be payable on a fluctuating rate of interest under a mortgage document. However, once Parliament has done all of that, the Governor in Council may, with the snap of his finger, repeal both of those sections.
We in this place have on many occasions witnessed the regular delegation of the authority of the House to the Governor in Council. Until today, I had yet to see the ability to repeal absolutely by Order in Council the Bills that this House passes. That is exactly what this offensive provision would do. I am indebted to my colleague for drawing this matter to the attention of the House. He may indeed wish to make some observations with respect to both of these provisions and deal with them at some greater length.


William James Kempling: Mr. Speaker, I thank my colleague for recognizing the impact of Section 11.1. Quite correctly, one of the great dangers in a parliamentary system is that the power of the Parliament is eventually eroded away. This is one of the ways in which that is done. Bills are drafted and sections of old statutes are amended and these amendments are couched in the language of the drafting officers to the extent that the average individual does not understand what he is reading and becomes confused after a period of time. Consequently, a Bill passes and no one pays that much attention to it, particularly when it passes on a Friday afternoon or near the end of a session.
Parliament and the country are in danger when we pass Bills that are not debated. As well, we are in danger when we pass Bills that we do not thoroughly understand. That is when the people of the country lose power and that is when the Parliament of the country loses power. That is something against which we must fight at all times.
The enabling power that this clause will give to the Governor in Council means in effect that he can dictate to whom this section will apply and to whom it will not apply. He can put things in and take them out. As recognized by my colleague, the important thing is that we are giving the Cabinet and the Governor in Council the right to amend an Act of Parliament without further reference to the Parliament of the country. That is something against which we are going to fight and we will see that it does not happen in this Bill.


Donald Alex Blenkarn: Mr. Speaker, the Hon. Member for Burlington (Mr. Kempling) told me that he lived at one time in Dundas, Ontario, a relatively small town. He said that, in most cases, people who lived in Dundas never went to a trust
Interest Act
company or a mortgage company for a loan because, in fact, most of the trust companies and mortgage companies in Dundas did not lend. When seeking a loan, those people went to see their local lawyers.
As someone who was a very prominent citizen of that town at one time, I was wondering if the Hon. Member could tell me whether or not he thought that the people who went to see their local lawyers would be prepared to understand or would be able to understand the following, and I am quoting from the Government's press release:
To account for the fact that the lender can reinvest the penalty at prevailing interest rates, the future values of the interest differences must be brought back, or "discounted", to present value terms. This "present value" of the differences will equal a lower figure than would result from simply adding them up, and it is this lower figure that will constitute the maximum penalty that can be imposed.
I was wondering if the Hon. Member thinks that an ordinary person who was a client of a law office in Dundas that was lending money on mortgages could understand that.


William James Kempling: Mr. Speaker, I thank my colleague for his kind references to my former place of residence. One of the tragedies of the mortgage field is that the local lawyer was the source of much of the funding of mortgages in the past, but that field has virtually dried up for the lawyer. The lawyer ends up doing a legal service for a mortgage company, a bank or a trust company and receives a stated fee.
With all due respect to the people I know who live in Dundas and in the areas around Dundas who practise law, I do not think that they have the necessary staff to comprehend the meaning of that statement. It will be so confusing to them that they will feel that they cannot be involved in that field any longer. It is a tragedy that the mortgage field is being narrowed down to include only larger institutions and banks and trust companies.
The private mortgage field built this country, and up until probably the mid-1950s the bulk of mortgage money came from private small lenders and local lawyers. These people are now being excluded and the mortgage field is being pushed toward the big money market. I think that that is a tragedy and something that we must stop and even reverse.


Mr. Deputy Speaker:: The House will now proceed to debate.


Mr. Cyril Keeper (Winnipeg-St. James):: Mr. Speaker, I welcome this opportunity to enter the debate on Bill C-36-


Donald Alex Blenkarn: Mr. Speaker, I rise on a point of order. Several matters have been raised. I was wondering, Mr. Speaker, if you did not see anyone from the government side rise to speak. I would have thought that someone from the government side would have wanted to speak in order to answer these allegations of incompetent draftsmanship-


Mr. Deputy Speaker:: Order. That is hardly a point of order. The Hon. Member for Winnipeg-St. James (Mr. Keeper) caught the Speaker's eye.

June 7, 1984
Interest Act


Cyril Keeper: Thank you, Mr. Speaker. Obviously my colleague on this side of the House is more optimistic than I about what could happen on that side of the House.
Bill C-36 is a significant piece of legislation, not because it accomplishes anything, but because it deals with a very important subject that affects all of our lives. Interest rates are not just something that we read about in the Globe and Mail. Interest rates are something which affects us in our daily lives. They affect the amount of disposable income which we have and our capacity for owning a home. Owning a home is something which Canadians have traditionally considered a right. It has been natural for Canadians to assume that they have the right to own a home. However, interest rates have threatened the common assumption which we have shared as a community. This legislation, which will amend the Interest Act, does nothing substantial to protect the right of Canadians to own a home or to protect the right of Canadians to an adequate income.
This debate is crucial. The way in which interest rates have fluctuated over the last several years has made Canadians very insecure. As well, this fluctuation has put a damper on the economy and on investment. Therefore, when the Government comes before the House with a piece of legislation affecting the Interest Act, we would expect it to be substantial and to deal with the meat of the question. We expect it to have a true impact upon interest rates and to restore some sense of security in the minds of Canadians with regard to their capacity to own their own home or to invest in economic activity and to have a job.
I would like to mention specifically the areas which I find questionable in the legislation. Before I deal with that, I would like to mention that at one time in Canada there were longterm mortgages. Long-term mortgages went out in the midseventies because the Government introduced a legislation which allowed for the disappearance of long-term mortgages. It would be wise to remind Canadians that long-term mortgages are still available in the United States. Therefore, it is possible to have an economy and a mortgage system in which there are long-term mortgages and an opportunity to provide to people who borrow money in order that they might own a home.
The legislative action of previous governments in Canada has added to the insecurity of people concerning mortgages, interest rates and owning their own home. The reason I mention this and the reason that it is relevant to the discussion today is that the same situation is happening. This piece of legislation deals with interest rates. It will increase insecurity and make it more difficult for people to own their own home, rather than enhance the possibility of Canadians owning their own home.
I would like to draw to the attention of the House some specifics. One of the proposals before us is the notion that people who have a mortgage should have the right to be able to prepay that mortgage at any time. Well, the big "but" that
goes along with this so-called right is the fact that the person would have to pay a penalty, which would include the full interest rates due between the time when the person chose to take the action and the end of the term of the mortgage. It is a nothing proposal. It is a right which has no substance. It is a rhetorical right. It will not help people in terms of coping with interest rates and their insecurity with the fluctuation of interest rates.
It is important to remember that it has been some time since interest rates hit 18 per cent and people were trying to get out of their 18 per cent mortgages and into the 12 per cent mortgage category. Yet today the interest rate market is so unstable that people are once again beginning to worry that interest rates will sky-rocket the way they did a few months ago. I would think that a government which cared would have brought in legislation to answer the concern which people have with regard to the stability of interest rates as they affect their mortgages.
The legislation eliminates the interest rate penalty of three months that a person would be obliged to pay to get out of a high interest rate mortgage and into a mortgage that is at a lower rate. Members on this side of the House have called upon the Government on many occasions to standardize the three-month penalty. We wanted to limit the penalty which people would be obliged to pay if they were to get out of a very high interest rate mortgage and into a mortgage which reflected the market interest rate of the day. Rather than people being forced to continue to pay very high interest rates after interest rates have come down, it is important that the penalty which people are obliged to pay under this system be limited. Therefore, we called for a standardization of the penalty. What did we get from the Government? We got an elimination of the three-month penalty. It is augmenting the insecurity which people face when they borrow money in order to pay for their home. Of course, the Government has a rationale for doing this. It wants to ensure that there is mortgage money available for people to borrow.
It is good to have mortgage money available, but surely there is some place in our economic thinking for the notion of a just return on money or a just interest rate. Surely it is not acceptable to Canadians or to their Government to allow for the market to set interest rates at any level. Surely there comes a point at which governments say, "No, you have gone too far. You are entitled to a fair return on your capital, but you are not entitled to rip off Canadians and you are not entitled to increase the insecurity that people live under in this country*.
Rather than helping people deal with interest rates, this Bill in fact increases the insecurity in the lives of ordinary Canadians today. Unfortunately, there are more ways in which this legislation adds to the insecurity of ordinary Canadians. This legislation intends to legalize some very dubious mortgage-


Mr. Speaker:: Order, please. I believe that there has been a communication. Would the Hon. Member please resume his seat.



[Stage Direction]
A message was delivered by the Gentleman Usher of the Black Rod as follows:
Mr. Speaker, the Honourable Deputy to the Governor General desires the immediate attendance of this honourable House in the chamber of the honourable the Senate.
Accordingly, Mr. Speaker with the House went up to the Senate Chamber.
And being returned:
Mr. Speaker:: I have the honour to inform the House that when the House did attend the Right Hon. the Deputy to Her Excellency the Governor General in the Senate Chamber, the Right Hon. the Deputy to Her Excellency was pleased to give, in Her Majesty's name, Royal Assent to certain Bills:
Bill C-23, an Act to amend the Prairie Grain Advance Payments Act- Chapter No. 7.
Bill C-4, an Act to amend the Coastal Fisheries Protection Act-Chapter No.
8.
Bill C-l 1, an Act to amend the Currency and Exchange Act-Chapter No. 9.
Bill C-44, an Act to amend the Yukon Quartz Mining Act-Chapter No. 10.
Bill C-41, an Act to implement a treaty between Canada and the United States relating to the Skagit River and Ross Lake, and the Seven Mile Reservoir on the Pend d'Oreille River-Chapter No. 11.
Bill C-42, an Act to establish the Asia-Pacific Foundation of Canada- Chapter No. 12.
Bill C-l2, an Act to amend the Federal-Provincial Fiscal Arrangements and Established Programs Financing Act, 1977-Chapter No. 13.
Bill C-205, an Act to change the name of the electoral district of Hull- Chapter No. 14.
Bill C-241, an Act to amend the Senate and House of Commons Act- Chapter No. 15.
Bill C-45, an Act for granting to Her Majesty certain sums of money for the Government of Canada for the Financial year ending the 31st March, 1985- Chapter No. 16.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. MacLaren that Bill C-36, an Act to amend the Interest Act, be read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
Cyril Keeper: Mr. Speaker, before we received the message from the Senate, I was attempting to put on record my thoughts with regard to the
Language Rights
amendments to the Interest Rate Act. It is important to put on the record how we view the Government's amendments to the Interest Act. As I said before, the fundamental problem with the amendments is that they tend to increase the insecurity of Canadians rather than assist Canadians to face their responsibility to carry debt under the mortgage system which exists in the country. I was giving a number of examples before we were interrupted. I will mention some other reasons that I think this legislation increases the insecurity of home owners trying to pay off mortgages, rather than assists home owners to face that responsibility.
This legislation legalizes some pretty dubious mortgage instruments. One of these instruments is called the variable rate mortgage. Lenders have been able to make this kind of mortgage available under existing legislation, but this legislation makes the variable rate mortgage clearly legal. The problem is that the variable rate mortgage leaves home owners with mortgages in a very insecure situation. They do not know how much their monthly payment will be. Home owners do not know whether they will be able to afford to stay in the home they are in. How can people feel secure under those circumstances? Surely the function of an economy is to provide some security for people. Surely the function of government is to direct the economy to provide security for people.
The legalization of variable rate mortgage simply adds to the insecurity of the average citizen. It legalizes the terrorizing of home owners by financial institutions. If the Government had wanted to bring in interest rate amendments which would be of interest to ordinary Canadians, it would have brought in amendments which would have added to people's security rather than to their insecurity.
Another specific item in these amendments is something called the index linked mortgage.


The Acting Speaker (Mr. Guilbault):: Order. The Chair regrets to interrupt the Hon. Member but the clock shows five o'clock.
It being five o'clock, the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper.



PRIVATE MEMBERS' BUSINESS-MOTIONS

["I regret to interrupt the Hon. Member, but the hour provided for consideration of Private Members' Business has now expired."]
The Acting Speaker (Mr. Guilbault):: Shall all orders and items preceding No. 12 stand by unanimous consent?


Some Hon. Members:: Agreed.

June 7, 1984
Language Rights



[Stage Direction]
Mr. Jean-Robert Gauthier (Ottawa-Vanier), seconded by Mr. Tousignant, moved:
That this House resolves that Her Excellency the Governor General be authorized to issue a proclamation under the Great Seal of Canada amending the Constitution of Canada, pursuant to Section 43 of the Constitution Act, 1982, as follows:
[Stage Direction]
Shall I dispense?
Some Hon. Members:: No.


The Acting Speaker (Mr. Guilbault):: The Chair will try to read this long motion before we reach six o'clock.


PROCLAMATION AMENDING THE CONSTITUTION OF CANADA
The Acting Speaker (Mr. Guilbault):: The Hon. Member for Ottawa-Vanier (Mr. Gauthier) on a point of order.


Mr. Gauthier:: Mr. Speaker, with respect to the reading of the motion put on the Order Paper of the House of Commons, on May 22, 1984, this resolution has already been made public and has been with us for nearly a year; I think it would be a waste of time to read it, as it is quite long and already is on the record of this House. As I was saying, there is no need to read it as it would take much of the time which could be better used to debate the motion.


The Acting Speaker (Mr. Guilbault):: The Chair is in the hands of Hon. Members. We need unanimous consent to dispense with the reading of the motion. I would just like to inform Hon. Members that the motion is fairly lengthy and may take probably as much as 50 per cent of the time. However, if I am requested to read it, I will do so.



[Stage Direction]
1.	The Manitoba Act, 1870 is amended by adding thereto, immediately after section 23 thereof, the following sections: Official Languages of Manitoba "23.1 English and French are the official languages of Manitoba.
Equality of both language versions
23.2	(1) The English and French versions of Acts of the legislature of Manitoba enacted in both languages are equally authoritative.
Definition of "Act"
(2)	In this section and sections 23.3 and 23.6, "Act" has the same meaning as it has in section 23.
Act enacted after December 31, 1985 to be in both official languages
23.3	(1) Subject to section 23.6, any Act of the legislature of Manitoba enacted after December 31, 1985 is of no force or effect if it is not printed and published in both official languages.
Saving provision
(2) Notwithstanding section 23, but subject to sections 23.4 and 23.5, no Act of the legislature of Manitoba enacted before January 1, 1986 is without force or effect by reason only of its having been printed and published in only one official language.
Public general statutes to be in both official languages
23.4	(1) Any public general statute included in the Revised Statutes of Manitoba, 1970 and any public general statute enacted on or after January 1, 1970 of a kind normally included in a general revision is of no force or effect if it is not printed and published in both official languages on or before December 31, 1993.
General revision of public general statutes
(2)	Any general revision of the public general statutes of Manitoba enacted after the coming into force of this section is of no force or effect if it is not printed and published in both official languages.
[Stage Direction]
Delay period for revision
(3)	A general revision of the public general statutes of Manitoba shall be printed and published on or before December 31, 1993.
Delay period for re-enactment of certain Acts
23.5	(1) Any private Act or public municipal Act, or any public general statute not of a kind normally included in a general revision, that is referred to in the schedule, or any amendments to or Act substituted for any such Act or statute, is of no force or effect after December 31, 1993 if it is not re-enacted in both official languages on or before that date.
Delay for re-enactment of certain regulations (2) Any regulation enacted before January 1, 1986 that would, if enacted on or after that date, be of no force or effect under subsection 23.3 (1) if it were not printed and published in both official languages is of no force or effect after December 31, 1993 if it is not re-enacted in both official languages on or before that date.
[Stage Direction]
Exception for amending Acts
23.6	Notwithstanding section 23, no Act of the legislature of Manitoba enacted before January 1, 1994 that only amends one or more Acts of the legislature of Manitoba that are in force notwithstanding the fact that they were printed and published in only one official language is without force or effect by reason only of its having been printed and published in only one official language.
Communications between public and certain institutions
23.7	(1) Any member of the public in Manitoba has the right to communicate in English or French with, and to receive available services in English or French from,
(a)	the head or central office of any department of the government of Manitoba;
(b)	the head or central office of
(i)	any court,
(ii)	any quasi-judicial or administrative body of the government of Manitoba,
(iii)	any Crown corporation, or
(iv)	any agency of the government of Manitoba established by or pursuant to an Act of the legislature of Manitoba;
(c)	the office of the Chief Electoral Officer; and
(d)	the offices of the Ombudsman for the Province of Manitoba.
Idem
[Stage Direction]
Idem
(2) Any member of the public in Manitoba has the right to communicate in English or French with, and to receive available services in English or French from, any office not referred to in subsection (1) of an institution described in paragraph (l)(a) or (b) where
June 7, 1984
[Stage Direction]
(a) there is a significant demand for communications with and services from that office in that language; or
(A) due to the nature of the office, it is reasonable that communications with and services from that office be available in both English and French.
Section 23 not affected
(3) Nothing in this section abrogates or derogates from any rights guaranteed by section 23.
Enforcement of rights under section 23.7
23.8	(1) Anyone whose rights under section 23.7 have been infringed or denied may apply to the court for a declaration to that effect and, where that court finds that those rights have been infringed or denied, it may make a declaration to that effect.
[Stage Direction]
Declaration and court order for plan
(2)	Where the court makes a declaration under subsection (1), it may order the institution concerned to submit to the court a plan for changing its administration to ensure that the rights under section 23.7 are respected by the institution, and the institution shall forthwith submit a plan for the approval of the court.
Submission of plan to court
(3)	Where a plan is submitted to the court pursuant to this section, the court may approve the plan as submitted, or may order the institution concerned to submit to the court a new or varied plan for the approval of the court.
When a plan is approved
(4)	When a plan submitted to the court pursuant to this section is approved by the court, the institution concerned shall forthwith make such changes in the administration of the office concerned as the plan requires.
Definition of "court"
(5)	In this section, "court" means the Court of Queen's Bench for Manitoba". Coming into force of section 23.7 and 23.8
2.	Section 23.7 and 23.8 shall come into force on January 1, 1987.
[Stage Direction]
Citation
3.	This Proclamation may be cited as the Constitution Amendment Proclamation, 1984 (Manitoba Act).
Ramon John Hnatyshyn: Mr. Speaker, I rise on a point of order. I think there may be a disposition, now that we have heard the resolution, to dispense with the reading of the schedule to the motion since the essential ingredients of the motion have now been presented to the House and we can proceed with the debate.


The Acting Speaker (Mr. Guilbault):: Is there unanimous consent that we dispense with the reading of the schedule?


Some Hon. Members:: Agreed.


Jean-Robert Gauthier: Mr. Speaker, the resolution you have just read and which I am moving today is identical to the one introduced by the Attorney General of Manitoba on behalf of his Government in the Legislative Assembly of Manitoba on July 4, 1983. The Manitoba resolution would have initiated the process of amending the Constitution of Canada and particularly the Manitoba Act of 1870 in relation to linguistic rights in that province. The Manitoba resolution reflected the provisions of an agreement made on May 16, 1983,
Language Rights
between the Governments of Canada and the Province of Manitoba, with, of course, the participation and agreement of the Societe Franco-Manitobaine. The compromise reached was the result of negotiations undertaken by the Manitoba Government to find a political solution to a major legal problem.
The Manitoba Government anticipated the possibility that the Supreme Court of Canada, in ruling on the Bilodeau case, could invalidate all provincial legislation passed in English only during the last 90 years in flagrant violation of Section 23 of the Manitoba Act of 1870. This section provides, among other things, that the acts of the Province of Manitoba are to be printed and published in French and English. The Supreme Court had indeed already stated in effect in its Forest and Blaikie rulings made in December 1979 that this obligation extended to the passage of legislation. Thus, according to the Manitoba Government, the purpose of the negotiations was to avoid the actual possibility that the Supreme Court would declare nul and void any unilingual legislation and require the writing and passage of both the French and English versions of each legislative text passed in English only during the past 90 years.
The Manitoba Attorney General, Mr. Penner, in his speech upon introducing the motion proposing the constitutional resolution on July 4, 1983, said the following:

-we have heard, and I'm sure we will hear again, 'well, you should have fought it in the Supreme Court of Canada'... I would remind those who urge that course of action that the Government of Manitoba ... took that stance of Tight it' in the Forest case in the Supreme Court and lost, and went on to instruct Counsel in the Blaikie case, in the Supreme Court, on the same issue, and lost. That's what our record is, zero for two, in the Supreme Court, on these very same issues-
So we sought an agreement-not a dishonorable thing to do-the kind of thing that one does day in and day out when faced with a particularly complex or difficult issue before the courts-
-Our initial position, that is the initial position of the government, was simply this: Give us the time that we feel we need; eight years, ten years, 12 years and cut down the requirement of translation from 4,400 to about 400 laws; that was our proposition. We put it on the table-nothing more. It was rejected. Why, said the other parties, what are you talking about; that's ridiculous. That much at least we could get from the Supreme Court of Canada. We'd rather take our chances before the Supreme Court of Canada than "settle" on this basis. You're asking us to give something for nothing. There is no quid pro quo; no this for that. You can't be serious. We then raised the question, well what is the quid pro quo? What is this for that? What is the agreement to be based on, and essentially it was that there should be some constitutional guarantee for French language services that were already being delivered by the government and that then became the key negotiating issue.

Constitutional expert Stephen Scott, when testifying before the Committee of the Manitoban legislature which was considering the agreement, told members who objected to the inclusion of certain bilingual services, and I quote:

The shortest answer to this objection is of course that the constitutional amendment will dispense with the duty to translate an immense volume of legislation covering close to a century and will also give the province a considerable further breathing space. It is surely not unreasonable for something to be offered in return, particularly to those whose rights have been denied for so long

June 7, 1984
Language Rights
a period. There is indeed no reason why they should accept a one-sided settlement which simply gives the province an indulgence and gives them nothing at all-
Manitoba in effect says this in the agreement. "For nearly a century the constitutional obligation to legislate bilingually has been violated, even after that obligation was reaffirmed by the Supreme Court of Canada. We ask these breaches to be execused and our laws to be declared valid, and also a further breathing space for future compliance. In exchange, we offer bilingual services from central provincial agencies, and from others, where the circumstances make it reasonable."
Surely this says, "It is true that we have been in breach of our obligations, but we will now make good and settle in a way which will compensate you fully".
Surely this tells all Canadians that our constitutional system can cure historic injustices and potential legal crises. It invites Canadians to rely in confidence on their constitution and in the good faith of their provinces and country. It renews and strengthens our federation.

The agreement of May 16, 1983 and the proposed constitutional amendment contain a number of points, Mr. Speaker, which may be summarized as follows:
First of all, it is stated that any Act of the legislature of Manitoba enacted after January 1986 is of no force or effect if it is not printed and published in both official languages. Unilingual Acts enacted before January 1986 shall remain in effect until 1994, and this applies also to any Act enacted after January 1986 as an amendment to a unilingual Act. Any public general statute included in the Revised Statutes of Manitoba, 1970 and any public general statute enacted after January 1970 is of no force or effect unless printed and published in both languages before 1994. A general revision of public general statutes shall be printed and published before 1994.
In addition, certain private Acts, public municipal Acts or any public general statute referred to in the schedule to this amendment, are of no force or effect unless printed and published in both languages before 1994.
Mr. Speaker, the net result of this agreement is to reduce the task of translating 4,400 unilingual Acts to that of translating the 400 Acts judged to be most relevant. An orderly and realistic time frame for translation had to be established, to preserve the validity of unilingual legislation in Manitoba for ten years. In exchange for this compromise, the constitutional amendment would enshrine the right of the public to use French or English to communicate with certain Government institutions and with the legislature of Manitoba, and to receive available services.
The historical and constitutional crisis would thus be resolved, and by meeting this challenge, the legislature of Manitoba and the parliament of Canada would be establishing the basis for dealing in a just and equitable manner with minority rights in the rest of Canada. To quote once more constitutional expert Stephen Scott, testifying before the legislature of Manitoba:

Franco-Manitobans are, it is true, relatively few in number. But the province of Manitoba was created by the Parliament of Canada on the basis of legislative and judicial bilingualism; and the violation of these guarantees, for more than
ninety years, can be, has been, and is, cited by French-speaking Canadians elsewhere as proving that our Constitution-our country-cannot keep faith with its citizens. Surely if we are to have a country founded on respect for the rule of law-of any country at all-we must leave no basis for such beliefs.

For the same reasons, Mr. Speaker, the constitutional agreement of May 1983 received the solemn and unanimous support of this House in the form of two resolutions on French language rights in Manitoba, adopted here in the House on October 6, 1983 and on February 24 of this year. Mr. Speaker,
I shall recall, if I may, the most important and most relevant passages of these resolutions. First of all, on October 6, and I quote:
Whereas it is in the national interest to support continued efforts by the Government and Legislative Assembly of Manitoba to fulfil effectively their constitutional obligations and protect the rights of the Frenchspeaking minority of the province;
(1) the House endorses, on behalf of all Canadians, the essence of the agreement reached by the Government of Canada and the Government of Manitoba, with the participation of the Societe Franco-Manitobaine, on May 16, 1983, to modify the Manitoba Act, 1870;
The House invites the Government and Legislative Assembly of Manitoba to take action as expeditiously as possible in order to fulfil their constitutional obligations and protect effectively the rights of the French-speaking minority of the province.
This passed unanimously.
On February 24, 1984, there was another resolution, and I quote:
Whereas the Legislative Assembly of Manitoba, after several months of debate, is being prevented from bringing the constitutional resolution to a vote, and therefore from fulfilling its constitutional obligations;
(1)	the House urges the Government of Manitoba to persist in its efforts to fulfil the constitutional obligations of the province and protect effectively the rights of its French-speaking minority in a spirit of tolerance and civility, amity and generosity;
(2)	the House urges the Legislative Assembly of Manitoba to consider such resolution and legislation in an urgent manner so as to ensure their timely passage.
Mr. Speaker, it also passed unanimously.
One of the Supreme Court's roles is first and foremost to uphold the Constitution of the land and to ensure that its provisions are adhered to. For that reason, the Court did not hesitate in 1979 to declare void chapter 3 of the Quebec Charter of the French Language, which violated Section 133 of the Constitutional Act of 1867. The Court in Blaikie then found that section 133 of the British North America Act required that official status be recognized to both languages, English and French, in Quebec's and Canada's legislation and courts. For that reason, the Supreme Court found unconstitutional the 1980 Act titled "An Act to Provide that the English Language shall be the Official Language of the Province of Manitoba." That Act, which purported to make English the official language of the province by abolishing the use of French in Manitoba's legislation and courts was rendered inoperative by Forest. The practice which had prevailed over 90 years and the political difficulties caused by the Supreme
June 7, 1984

Court's ruling did not intimidate the Court which supported the Constitution.
The role of Parliament and other legislative bodies, on the other hand, is to solve political problems. It is not the Court's responsibility to repair the damage done by politicians. The court must uphold the constitutional means for politicians to correct their errors themselves. Therefore, the solution of Constitutional changes, under fair and equitable terms, came to the mind of the Manitoban legislators. What is called in the British legal tradition "the rule of law", the principle of lawfulness, could then be asserted not only by the courts but by the political authorities.
The Right Hon. the Prime Minister of Canada (Mr. Trudeau), during the debate on the first House of Commons resolution, had this to say on October 6, 1983, and I quote:
I admire the Supreme Court for saddling politicians with this problem, since it is its role. The Supreme Court must tell us what the Constitution says, without worrying about the political, social or economic problems that may arise as a result of a Supreme Court judgement on a legal matter arising from the Constitution.
Mr. Speaker, at that point a solution appeared to be in sight. However, an aggressive minority in the Manitoba Legislative Assembly, vehemently opposing any form of development of linguistic rights in the province, blocked everything. That group of opportunistic, petty politicians, disregarding the Constitution and the agreement between the federal and provincial governments, over and above the two resolutions passed by this House adjoining them to proceed, refused to believe that the Supreme Court would dare invalidate the unilingual legislation involved.
However, the Supreme Court will hear the Bilodeau case and the Reference on Linguistic Rights next week, and as I said, the Court could soon declare null and void all the acts and regulations involved. In fact, according to some Constitutional experts, the Court might even explicitly state that nothing short of a Constitutional amendment would be accepted to fill the legal vacuum that would result from such a court ruling.
The Court could state that the Manitoba Legislative Assembly, that would sit de facto, would be only authority empowered to pass the resolution required by the amendment procedure which is delineated in Section 43 of the Constitution Act, 1982. Barring such a constitutional amendment, the Court might not see the need for preserving the unilingual legislation, even for a short time. This way, the Supreme Court would encourage the respect of the rule of law and the Constitutional process, while sending the ball back into the political arena.
At that point, Mr. Speaker, the problem would reach its full scope. Manitoba would be deprived of laws other than those enforced before 1890. A constitutional amendment would become extremely urgent for that province. Like Quebec on December 13, 1979, when the National Assembly sat all night
Language Rights
to re-enact all previous unilingual legislation in both languages, Manitoba would have some catching-up to do. However, because of the absence of any legislation in French over a period of ninety years, Manitoba could not pass an omnibus bill as Quebec has done. It would make more sense for Manitoba to adopt its constitutional resolution according to Section 43 of the Constitutional Act, 1982 a resolution that is before the House today-and this time without any obstruction from the Conservative Opposition, of that I am sure, since its room to manoeuver would be reduced to nothing as a result of the judgment of the Supreme Court.
A constitutional amendment that concerns the use of French or English in a province must, according to Section 43, be made by proclamation issued by the Governor General under the Great Seal of Canada and only where so authorized by resolutions of the Senate and the House of Commons and of the Legislative Assembly of the province in question. Must we wait, Mr. Speaker, until the unilingual fanatics realize that the Supreme Court has invalidated all the statutes and that Mr. Pawley and Mr. Penner were right? Must we wait any longer before we act as responsible and intelligent parliamentarians? Would it not be wiser to adopt this resolution as provided in Section 43 of our Constitution and in accordance with the terms of the agreement between the Government of Manitoba, the federal Government and the Societe Franco-Manitobaine?
I would emphasize that unless a resolution of the Parliament of Canada is accompanied by its provincial counterpart, it can have no legal effect on the Constitution. So there is nothing unilateral about adopting this resolution in the House. There is no question of any imposition by the federal Government. We would adopt, in its entirety, a resolution arising out of negotiations conducted in good faith, a resolution that received the unanimous support of this very same House. Twice, we encouraged and urged Manitoba to adopt this resolution. Within this context, the resolution is a precautionary measure being offered to Manitoba, and the province may consider and eventually adopt it if it is deemed appropriate.
However, the resolution goes beyond the legal and political sphere. It is a re-affirmation of principles that are part of the very fabric of our Canadian way of life. As the Hon. Leader of the Opposition (Mr. Mulroney) said so eloquently during the debate on the first resolution on language rights, on October 6, 1983, and I quote:
The purpose of this resolution is one which has touched the soul of Canada for decades.
Years ago this House approved the principle of official bilingualism for Canada. Simply put, it means that English and French Canadians shall have equal rights and equal opportunities across Canada. It is a noble principle, one which is capable of enriching the life of this nation.
I continue to cite the Leader of the Opposition (Mr. Mulroney). He said:
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June 7, 1984
Language Rights
This resolution is about fairness. It is about decency. It is an invitation for co-operation and understanding. It speaks to the finest qualities in this nation.

The Leader of the New Democratic Party also supported this motion, and he said:

-what we are doing today in unanimously supporting this resolution goes beyond support for the details of a particular Bill in a single province on a given date. We are now acting in the spirit of those who created Canada in 1867, who out of necessity and by imagination created our fundamental duality. We are supporting a spirit of tolerance and a respect for diversity which should always be the hallmark of Canada and of Canadians. Never again should any Canadian say-

"In am a stranger in my own country."
Mr. Speaker, as I pointed out at the beginning of my speech, the resolution I have just proposed in the House is indeed the resolution tabled by the Attorney General of Manitoba, Mr. Penner, in the legislature of Manitoba on July 4, 1983. In concluding, I would therefore like to quote Mr. Penner's last words, because they are very appropriate today:

Let us tell Manitobans, you have nothing to fear. Let us tell Manitobans rather, you have everything to gain. You will have not only paid history's debt in a reasonable and an economical way, you will have done something, we can say to ourselves and to Manitobans, you have done something for Canadian Unity that will live long in the history books, long after we have left this place of noise, strife and turmoil.

Mr. Speaker, I urge the House to adopt this resolution.


Arthur Jacob (Jake) Epp: Mr. Speaker, the resolution that is before the House today is a distinct departure from the motions which have been passed in the House on two previous occasions. The resolution before the House today is a constitutional amendment, which is possible under the provisions of the Constitution Act, 1982, but one which, if the process were accepted, would violate the federal spirit of Canada. It does not reflect in process of time the situation in the Province of Manitoba, either in the Legislature or among the citizens of Canada at this time. It is my intention this afternoon to point out to the House why this approach is wrong, why this approach is divisive and why this approach will not lead to solutions which we all seek.
Constitutional amendments must be approached with care. They must be clothed by the vision of the future. They must be tempered by the awareness of history, and they must be constantly governed by a commitment to fairness. I suggest that the resolution before us today and the manner in which it has been introduced by the Hon. Member does not meet those criteria.
Put in simpler terms, constitutional amendments, if they are to have legitimacy, must be seen by the public as doing the right thing. I say to the Hon. Member today that the approach
he has taken does not meet the criterion of doing the right thing. Why not? All Members in this House, Manitobans and most Canadians, are aware of the debate that has taken place in our province, in the Legislature and in our homes over the last months. The matter has been thoroughly discussed in my province. What is important is that, despite those discussions, a process is now entrained which should not be tampered with or modified by any intervention in this House, that is, that this matter will be before the Supreme Court of Canada on Monday next, June 11.
Those hearings will begin at that time. No one in the House can determine what will be the decision of the court. No one in the House should use his parliamentary position to predetermine any modalities that the court might recommend or that the province of Manitaba might take in the Legislature. The Supreme Court decision could necessitate major changes to the very resolution before the House today. It is my submission that that kind of approach is improper and obviously does not appreciate the reality of the situation.
The Member who has introduced this resolution suggested in a letter to my Leader that it would be advantageous for the House to express once again its opinion on this subject through a constitutional amendment, something we have never done before, and that this would be helpful to the court as it begins its hearing. My concept of executive powers, of legislative powers and the division of legislative powers and judicial powers is very clear. I do not believe that we should use Parliament, when we know that this matter is before the courts as of Monday, to try in whatever form-if in fact we could, and I suggest we might not be able to-to send signals in any way, to give impressions or to leave opinions on the record of which the court would then be apprised. The court is independent and should be left as such.
What we have before us is an amending process. I remind Members of the House and Canadians generally that those of us from western Canada who sat on the special joint committee studying the constitutional resolution argued literally for months that a constitutional amendment, that is the process by which our Constitution would be amended in the future, should reflect the reality of Canada and that a constitutional amendment proposal such as produced by the Government, which would entrench for all times that certain provinces and, therefore, certain Canadians would have a veto power and, therefore, others would not, was not a reflection of the reality of Canada and in fact would make those of us who did not live in those provinces or those who come after us second-class citizens.
Our Constitution today has three amending formulas. The burden of our argument was that we should not have imposed on us from the outside constitutional changes which we ourselves must determine. I remember the long debate regarding language and culture and a specific amending formula under Section 43 which was introduced that would allow the provinces-I know that for a long period of time the debate was relative to the Province of Quebec-to determine that aspect of any amendment relative to their constitution and language.
June 7, 1984

In fact, one province, New Brunswick, availed itself through its premier of that provision. I suggest to the Hon. Member for Ottawa Vanier (Mr. Gauthier) that he misinterpreted my Leader's comments. My Leader said in the House of Commons on October 6, 1983, as recorded at page 27819 of Hansard:
In the final analysis, it is up to Manitobans themselves to decide.
In Winnipeg, on March 29, 1984, he said:
So tonight, I am not going to tell Manitobans what to do or how to do it. I have no such right.
This is what the Hon. Member for Ottawa-Vanier is trying to do today, to impose a solution, a constitutional amendment. This is not in the spirit of Confederation. It is an imposition which is not acceptable to us.
Amendments to the Constitution, as we discussed constitutional amendments at the time, was that constitutional amendments were to be legislated from one legislature to another. I recognize that private Members have the opportunity now to bring in constitutional amendments as individuals, but I suggest we should go very carefully on that route because we have not had either precedents or experience because of our previous situation where amendments finally had to be made to the British North America Act in Westminster. We do not have those precedents. I suggest also, in view of the sensitivity of this issue, that this is not the time to establish that precedent.
On the matter of money Bills, no Member of the House other than a Member of the Cabinet can introduce a Bill relative to the royal prerogative. We all understand that approach. Today I would think that common sense would dictate that constitutional amendments should not be introduced through the process the Member is using in the House today.
There are additional reasons why this constitutional amendment is unacceptable. It is interesting to note that when the Member rose in his place to introduce it, he said that when it was introduced in July, 1983, it was exactly the same amending resolution as was introduced by the Attorney General of Manitoba. To that he was correct, but he was wrong in terms of the time frame today. Through that long process of debate, that original amendment was modified by the New Democratic Party Government that introduced the first resolution that is before us today and amended it. Therefore, he is introducing today a resolution which is not supported even by those who proposed it initially, that is, the New Democratic Party of Manitoba. In fact, there were three modifications to the resolution. I will not take the time of the House to go through the various differences between the first resolution which we have before us today and the one that was eventually not approved by the Manitoba Legislature. Simply on the matter of constitutional clarity, I would think that we would not want to consider a resolution which has already been changed by the province on at least three different occasions.
If you look at the schedule, which we did not ask you to read, Mr. Speaker, you will note that a number of corporations
Language Rights
and societies are listed therein. If the relative Bills passed in the Manitoba Legislature were not changed or translated, those societies could in fact cease to exist. I received a letter dated September 19, 1983, from Mr. Ernest A. Wehrle. I spoke to him today and received permission to put his letter on the record of the House. Mr. Wehrle is writing on behalf of the Historical and Scientific Society of Manitoba and the St. Boniface General Hospital. He said:
Our concern is with the wording of proposed Section 23.5(1). Its legal result, if the named private organization(s) were not re-enacted by December 31st, 1993, would be to extinguish the legal existence of the organization(s), and cause the assets of the organization(s) to pass to Her Majesty the Queen, in Right of the Province of Manitoba.
The risk, however slight, is an unfair and unacceptable one because the named organizations have no control over the process. It will be the failure of the Legislature to act, and not the failure of the organizations to act, which would cause such a severe penalty.
The Manitoba Legislature might deliberately select certain organizations for elimination, or it might happen as a result of a constitutional or international crisis. Present assurances from the government, or from political parties, are not binding upon a future legislature.
I spoke to Mr. Wehrle today because the Attorney General rejected that proposal in 1983. Then, after consultation, the Attorney General said that we were right and he in fact brought in an amendment to Section 23.5 which, after looking at today's resolution put forward by the Hon. Member, one could see has not changed. Again, it is after the fact. I would think that the Hon. Member should consider very carefully the effect of his resolution should it be accepted here in the House.
Canada is a federal state. This fact dictates that the propriety of the matter demands the proper etiquette between federal and provincial governments by allowing a provincial government to legislate within its own sphere of authority. It has | always been contemplated that a constitutional amendment for and on behalf of a people in a province would be initiated in that province and, following passage of the provincial request, the federal Houses of Parliament would then deal with the matter.
I would ask the Hon. Member if he has consulted with the Province of Manitoba lately regarding the acceptability of the resolution. Did he consult with other members of the legislature? Did he consult with those in Manitoba? Did he consult with Franco-Manitobans? I can give you the answer, Mr. Speaker, because I asked that question today and the answer is no. Yet he has the temerity to enter the House and take this kind of action.
I could put forward other arguments regarding possible decisions of the Supreme Court. However, I do not think that they would help us in our deliberations today because the court will decide that matter. The issue before us all is that there is surely no longer any doubt that there must be one resolution after the next establishing the principles of language rights. 1 would ask the Hon. Member if he is sincerely trying to find a solution to the problem or if he is trying to create a political opportunity for himself.


Some Hon. Members:: Hear, hear!

June 7, 1984
Language Rights


Arthur Jacob (Jake) Epp: I would suggest that it will not lead to understanding. I know that the exercise that the Hon. Member has put before us today will not lead to a solution.
I would like to tell you about something that has deeply troubled me, Mr. Speaker. I have looked forward to an opportunity to make the following comments in the House: Those of us who come from western Canada have always and will always regard ourselves as being as Canadian as those who come from other parts of the country. The Manitoba debate as it has become known has raised in the minds of some and on the editorial boards of certain newspapers the question of whether or not we in Manitoba and perhaps in western Canada as a whole understand the country. Our roots are deeply embedded in the soil of Manitoba.
As one who represents a riding which contains Canadians of English descent, a great number of Canadians of Francophone descent and many Canadians of multicultural descent, I say to Members in the House that we came to Canada and specifically to Manitoba with our cultures, our languages, our hopes and our dreams. These have become the realities of western Canada.
I would make the point that it was a necessity and a reality for those of us whose language was neither French nor English that English became the language of common communication. That is reality. I cannot change that and I do not want to change that. That is the way it is in the area in which I live.
I would also make the point that there is no solution to this problem in Manitoba or in the rest of the country that will be good for the unity of the country if we are to use these kinds of methods to try to develop solutions. Tolerance is not enough. What we need is understanding.
I say to my friends opposite that I want to understand them. All that we as western Canadians ask is that they understand our realities as well. We will build a better country if we understand each other. Let us put behind us the use of resolutions on language or cultural matters. Let us not try to indicate that such a resolution might be to the advantage of one group, because we will not build a country that way. Canada is a great country. We are diverse, and that is our reality. That diversity can also lead us to greater understanding and it can and should be a model to the rest of the world.
I say to my friends opposite that I believe that a solution to the Manitoba situation will come just as 1 saw a solution come yesterday to the problems of the Canadian municipalities association which is now meeting in Winnipeg. That solution was based on understanding, on dialogue and finally on agreement. Let us follow that route and not the one chosen today.


Some Hon. Members:: Hear, hear!


Mr. Bob Ogle (Saskatoon East):: Mr. Speaker, I have only a few minutes to speak on this issue today but I am happy to be afforded an opportunity to say a few words about it.
In general, I support what this Bill is attempting to do. I appreciate, as I imagine the mover of the Bill appreciates, that there was no chance that it would pass today. Nevertheless, it has given Members of the House another opportunity to speak on this matter. I congratulate both the mover of the Bill and the Hon. Member for Provencher (Mr. Epp) for addressing it from their points of view. As Members know, I speak from a political position in the sense of a political future in this House. I would like to add to that the feeling which I have regarding what has taken place in our country, particularly in Manitoba.
I believe that one of the major factors in the debate has been fear of the unknown. When there is fear, there is distortion. I grew up in a world which was not unlike Manitoba. I grew up in Saskatchewan. When I was a child, I literally lived in a language laboratory. If I had known what it was and if I had been open to it, I could have learned seven languages within two miles of where I was living. Unfortunately, at that particular time in history, my parents-who were Irish, from Quebec and completely bilingual in French and English-felt that there was something wrong in passing on to their children the ability to speak bilingually. I do not know why they felt that way. Thank God that is no longer true. On my way home to Saskatoon the other day, I rode with the president of the French schools in Saskatoon. He cannot speak a word of French. His four children are in the schools because he wants them to be bilingual. Somehow or other the fear that my parents were able to instil into our generation will not, I hope, be instilled into the next generation.
When I was about seven or eight years of age, there was an old French Canadian farmer who had come from Quebec and had become bilingual. He spoke with an accent, but he spoke English very clearly. He told me that I should learn another language. He told me that a language is a very light load to carry. That was great advice because a language is a very light load to carry. There is nothing to be afraid of in being able to understand another person who speaks another language. No one in Canada is forced to learn another language. They do not have to learn English nor do they have to learn French. However, it is very nice to be able to speak two, five or ten languages. What is really required is a change in mentality. That may come in the next generation, although I believe that the confrontation which has taken place in recent history in Manitoba would not bring that about. There seems to have been a lack of will to reach an understanding.
On November 15, 1976, I was returning to Canada after spending a year doing research with the International Development Research Centre in India. I was not aware of the fact that there was an election taking place in Quebec that day. I had been in India where there are 23 states. The states of India are basically divided by language. Although there are 400 languages or more, India has built itself into 23 states, basically with the same language groups. India does its official business in English and Hindi. With this massive number of languages and the massive division, this country, with a popu-
June 7, 1984

lation of 400 million or 500 million, is able to function. However, upon returning to Canada, coming through customs I found that an election was taking place which was basically being fought on the language issue. I said at that time, "What has happened to our country?" I did not understand why we were not able to accept each other with only two languages when a member of the Commonwealth is able to live with a diversity which is incomprehensible to Canadian minds.
I think it is extremely important to have an openness. There should not be the fear of someone forcing a language on anyone. I think we must be consistent in accepting the historical realities of our country and that the rights of minorities are guaranteed. Minority rights were established in 1870. The English were probably in the minority at that time.
I am sorry the Manitoba Government was not able to solve the question earlier this year with the help of the federal Government and others, but I do hope sincerely that it will be solved in the near future.


David Edward Crombie: Mr. Speaker, it gives me pleasure to be able to participate in the debate today, particularly because I was able to have the opportunity of hearing the Hon. Member for Provencher (Mr. Epp) who spoke so eloquently. I have heard him speak before on matters pertaining to the Constitution of this country. But, I might say that that is the best speech he has given. It was an outstanding and eloquent speech regarding his own province.


Some Hon. Members:: Hear, hear!


David Edward Crombie: I only have two or three minutes and I do not know that I need to embellish the arguments which were made by the Hon. Member for Provencher. However, I wanted to make a contribution which would remind us of the process we went through when we dealt with the much larger constitutional amendment. Like the Hon. Member, I was a member of the Constitution Committee.
During that time we heard people from across the country. We talked about the amending formula, and we talked about the importance of ensuring that the regions of the country, as well as its different cultures, felt a part of it all. At the end of the process, one of the most interesting things happened. We insisted that the matter be sent to the Supreme Court of Canada, before it proceeded to the United Kingdom. We insisted for months that that happen, and ultimately that is where it went.
After some weeks, the Supreme Court came down with its decision. It was probably the most Canadian judicial decision which I have had the pleasure of reading. To anyone who has not had the opportunity or has not taken the opportunity to read it I may say that it is not merely a judicial decision, it is probably one of the most impressive statements of what is in reality the Canadian political and constitutional process. It ended up by making a key judgment. It said that the Government's constitutional package was legal, but that it was not legitimate. I do not think that there is another country in the world which would understand that statement. In most coun-
Adjournment Debate
tries, including the republic to the south, if it is legal it is also legitimate. However, the Canadian political process for 250 years, and certainly since 1791, has always included an understanding that legality by itself does not confer legitimacy. What does confer legitimacy is the process of involving consensus.
Consensus in this country is a process which allows laws to be legitimate. That, of course, is what the Hon. Member missed entirely in his motion. The motion which the Hon. Member brought forward to the House today is unwise. It is not only unwise, it is trouble-making. It acts in a way which is totally outside of the constitutional process of the country. Therefore, it seems to me that the important thing to understand, if one is sincerely interested in ensuring the equality of the two founding languages, is that Canadians for generations have insisted that it be done according to a process. That is offended by my hon. friend when he brings forward this motion-


The Acting Speaker (Mr. Guilbault):: I regret to interrupt the Hon. Member, but the hour provided for consideration of Private Members' Business has now expired.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Miss Aideen Nicholson (Trinity):: Mr. Speaker, on May 18 I addressed a question to the Minister of Employment and Immigration (Mr. Roberts) about the practice of having visitor's visas automatically refused to applicants who have recently applied unsuccessfully for landed immigrant status. I asked the Minister to ensure that the practice be altered, and that instead a system be set up whereby each application would be assessed individually on its merits. I received a letter from the Minister who pointed out that there is no such policy. I am very well aware that there is no such policy but the practice exists. In his letter the Minister says that:
Neither the Commission which establishes policy in this area nor the Department of External Affairs, which is responsible for the issuance of visitor visas, has any policy or instructions to automatically refuse visitor visas to unsuccessful applicants for permanent resident status. If, in fact, such a practice currently exists at any office abroad, it has originated with local officials and is not sanctioned by me or Commission management.
The Minister goes on to say that he is not aware that any overseas post has enforced such a policy. He says:
If you have any information to the contrary, I would be pleased to receive it.

June 7, 1984
Adjournment Debate
I regret that the Minister allows staff whose work is so sloppy to draft letters for him. He of course knows perfectly well of some examples on which I have corresponded with him. 1 can give three examples, all of which have been the subject of correspondence between myself and the Minister. One is a case in the Philippines. The application of a woman for landed immigrant status had been delayed for many years. Finally, when she was accepted, her children were over 21 and were no longer eligible to accompany her. When she had been here for some months the children wished to visit her and they were refused visitor's visas.
There was a similar case in Islamabad. A man had been coming to Canada as a visitor each year. He spent his holidays with family here. He applied for landed immigrant status and when he next applied for a visitor's visa it was refused.
I could go on with other examples but the point is that the officials do have this practice of automatically refusing visitor's visas to people who have recently applied for immigrant status. It may not be the Department's policy, but it is certainly a practice at many of our overseas offices. I suspect it has become the practice because it is simpler to assume that anyone who has recently made an application for landed immigrant status is trying to get into the country with the intention of staying. It is simpler to then refuse the application than to sit down with the person and see what the exact circumstances are.
It is this laziness or passivity that I am objecting to. I say this with some sympathy for the officials. I understand that immigration officers generally have a very difficult job. I would rather see them exercise some judgment in that job than try to protect themselves with simple rules. I appreciate that if an officer overseas is required to exercise judgment, there will be times when that judgment is wrong. I would rather see some tolerance of error and have the occasional person come to Canada who is not a bona fide visitor, than have this blanket system which is harsh, impersonal, and does not fit with the goals of our Immigration Act which is meant to be human, responsive, and respectful of people.


Mr. Jean-Guy Dubois (Parliamentary Secretary to Minister of Employment and Immigration):: Mr. Speaker, I thank the Hon. Member for taking the opportunity provided by the late show to raise this question concerning the refusal of visitors' visas to applicants who have been denied landed immigrant status.
Mr. Speaker, I can say very briefly that further details can be added to the reply given by the Minister of Employment and Immigration (Mr. Roberts) to the Hon. Member for Trinity (Miss Nicholson) on May 18 last. Pursuant to Immigration Act Section 9, every visitor shall make an application for and obtain a visa. Still in accordance with Section 9, the decision rests with the visa officer who considers each case.
Accordingly, it would be against the legislation to refuse automatically visitor visas in some circumstances, for example when the same applicant has recently applied unsuccessfully for landed immigrant status. There is no such policy. I must add that the law requires the applicant to prove his good faith, and that was the basis of the Minister's answer to the Hon. Member. A recent application for permanent residence might indicate that the applicant intends to stay in Canada permanently.
However, in many instances, a visa can be granted to someone who applied for an immigrant visa if the application is still being processed or has been rejected. The Hon. Member may rest assured that each application is dealt with objectively, as it should be. I understand she would like the officials of the Department to be more humane or sensitive when reviewing the applications.
As the Minister indicated in his letter to her and as I said today, each case is reviewed objectively according to the law, and the Department of Employment and Immigration does its best to respond adequately to applications from immigrants. Canada has one of the most open and liberal immigration policies of any country, and I feel confident the Hon. Member will be reassured by my brief answer.


ENVIRONMENTAL AFFAIRS-OIL DRILLING IN LANCASTER SOUND-GOVERNMENT POLICY INQUIRY. (B) MINISTER'S ADVICE
Dave Nickerson: Mr. Speaker, my question to the Minister of the Environment (Mr. Caccia) a few days ago was a very simple one. All it sought was a simple statement of Government policy with respect to Lancaster Sound. I wanted to know whether the Government was going to proceed with oil and gas drilling there. Needless to say, I did not get a very satisfactory response.
What prompted my question, and why I felt it was necessary to ask what was government policy, was the public squabble that had been going on for quite some time between the Minister of the Environment on the one hand, and the Minister of Indian Affairs and Northern Development (Mr. Munro) on the other.
I am always at a loss to understand why it is that the Liberal Government insists on washing its dirty linen in public. Let me give a few quotations from the media. The first one is from the CBC MacKenzie Regional News on May 4. The item reads:
The Federal Environment Minister is urging a permanent ban on oil and gas drilling in the Lancaster Sound area in a proposal to the Minister of Indian Affairs and Northern Development.
An article in The Gazette on May 3 states:
A permanent ban on oil and gas drilling in the wildlife-rich Arctic region of Lancaster Sound is being urged by Environment Minister Charles Caccia.
June 7, 1984

Caccia urges the ban in a private letter, details of which have been obtained by Southam News which he wrote six weeks ago to Northern Development Minister John Munro.
A CP Wire service release on May 9 stated the other side of the argument being pursued by the Minister of Indian Affairs and Northern Development as follows:
The environment is just one of many concerns blocking a quick decision on whether to allow exploratory oil drilling in Lancaster Sound, the eastern entrance to the Northwest Passage, Indian and Northern Affairs Minister John Munro said Wednesday.
But Munro, whose department will make the final decision, is in no hurry to approve drilling in the region for a number of reasons, despite the millions that have been invested there since oil companies were granted exploration permits more than a decade ago.
What we have here is a case of one Minister leaking correspondence to the press to make public his departmental point of view and to put pressure on yet another Minister. We have the Minister of Indian Affairs and Northern Development publicly rebuking the Minister of the Environment by saying that his concern is not of any particular importance because there are a number of things that have to be taken into consideration.
The Lancaster Sound issue needs resolution. So far we have seen an attempt by the Minister of Indian Affairs and Northern Development to slough it off, make no decision at all and just hope that the matter will go away. All the people involved in the argument deserve from the Government of Canada a clear statement of policy, whether or not it plans to allow drilling to take place. The developers who have already spent millions of dollars want to be able to plan for the future. They want to know the terms and conditions, if any, which will attach to the authority that they may or may not be given to proceed with drilling.
On the other hand, those who oppose and would not like to see activity of that nature take place in that location deserve from the Government of Canada the knowledge of what in fact is government policy.
I think that the Government has forgotten what is the function of the Cabinet. Each Minister goes around publicly stating his side of the argument. Surely decisions should be made in Cabinet. That is the place and time where Ministers can come together, sit and discuss these matters and come to a proper decision. The function of Cabinet is to make important decisions where there may be conflicting views from each department. Once that Cabinet decision has been made, then we should and ought to have-and have had in the past- Cabinet solidarity where, regardless of which Minister of the Crown one asks, one gets the same answer. It should not be one answer from the Minister of the Environment and another answer from the Minister of Indian Affairs and Northern Development.
The argument on this issue which is going on in public ought to go on in private. The Government of Canada ought to speak with one voice. It ought not speak with many voices.
In closing, I urge the Ministers of the Crown to put aside their public squabbles, and I urge the Government to get its
Adjournment Debate
act together and come up with one firm policy statement on the Lancaster Sound issue.


Mr. Leonard Hopkins (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, Lancaster Basin represents a westward extension of sedimentary deposits occurring in Baffin Bay, for which seismic data indicates a sedimentary sequence six kilometres in thickness in the Sound. Although no wells have been drilled in Lancaster Sound or adjacent areas, some hydrocarbon potential is inferred from a small active oil seep in Scott Inlet a few miles to the north. Recent Geological Survey of Canada estimates place recoverable oil potential in Baffin Bay/Lancaster Sound at 55 million cubic metres and a 50 per cent probability.
There has been interest in exploiting the petroleum resources of Lancaster Sound since the late 1960s. A federal Environmental Assessment Review Office panel recommended deferment of exploratory drilling until the Government had addressed the issue of the best uses of Lancaster Sound, and the proponent had demonstrated the capability to deal with the physical hazards to drilling in the Sound and preparedness to mitigate effects of a blowout.
In response to the recommendation for a Government regional use plan, the Department of Indian Affairs and Northern Development undertook in 1980 a preliminary analysis of potential options for the use of Lancaster Sound and the surrounding region.
Since that time, Consolidex Magnorth Oakwood, a consortium which has succeeded Norlands Petroleum as the permit holder for the land in question, has published a resource management plan for Lancaster Sound hydrocarbon development, and has submitted an official letter of application for drilling to the Minister of Indian Affairs and Northern Development (Mr. Munro).
Before any decision can be made relative to the issuance of exploration agreements, a number of important steps must be taken involving several federal departments. The Department of Indian Affairs and Northern Development must conduct a land use planning exercise and partake in native rights consultations. The Department of the Environment must ensure that all appropriate environmental safeguards would be employed. The Canada Oil and Gas Lands Administration of Energy and Resources must investigate all aspects relative to the technological and economic feasibility of any proposal, be satisfied that proper safety measures would be taken, and that any proposal would meet the appropriate Canada Benefits criteria.
May I simply say that while the federal Government is currently studying various options, no development will take place in Lancaster Sound. Such development could only take place once decision makers had conducted multi-dimensional analyses that confirm that development projects could be carried out in a safe and timely manner and would be beneficial to the people of Canada, particularly those in the region.

June 7, 1984
Adjournment Debate


ENERGY-REMOVAL OF ONTARIO RADIOACTIVE WASTE. (B) RESPONSIBILITY FOR PERMANENT STORAGE
John Albert Gamble: Mr. Speaker, on May 25, 1984, after waiting for three weeks for the Minister of Energy, Mines and Resources (Mr. Chretien) to appear in this House during question period, and finding that he did not, I raised a question with the Minister responding for the Minister of Energy, Mines and Resources. That question related to the transportation of some 4,000 tons of low level radioactive waste from the Malvern subdivision in Scarborough to a location in the City of Scarborough on Reesor Road very close to the border of my riding of York-North, the intended sight being a few hundred yards from Steeles Avenue which separates the Town of Markham and the City of Scarborough.
I am rather surprised that the Liberal MP for that area has not taken a more active part in protecting the interest of his constituents, for what we are concerned with here is the relocation of some 4,000 tons of material which contain radium 226 in quantities which are from 20 to 280 times the normal level of that material in natural deposits in the Toronto area.
In addition, the material which is about to be transported contains substantial contaminations of arsenic. It is intended by the federal Government, which has under the terms of the agreement with the Province of Ontario dated November 3, 1983, acknowledged its responsibility for the permanent storage of the material, to locate this very substantial quantity of contaminated material on about two acres of land near the little Rouge River. The material is to be placed in a large plastic bag or a large plastic wrapper on the surface of the ground which geologically consists of sand and gravel-sand substance. This will permit the leeching of the contaminants from this material into the Rouge River system.
The people in that area, some of whom live as close as 1,000 yards to the intended site, obviously will be subject to this contamination. Radium 226 in its decomposed form becomes radon 222, a known carcinogenic gas which will produce lung disease and other lung ailments of the cancerous nature in human beings. It is absolutely astounding that with the available evidence the Government still proposes temporarily to transport but a few miles to where it will be located some material which is dangerous to human beings, and to store that material on a ground level site near a river-the people in the area derive their water supply from wells-and cover it with a plastic bag, with no more concern for the general public in the area than is disclosed by its conduct here.
Fortunately a group of citizens retained the services of a firm of solicitors and have commenced an action in the Federal Court of Canada. They apparently have obtained an interim injunction precluding the movement of this soil in the fashion the federal Government would contemplate.
My concern is very simply this. Recognizing, with the abundance of material filed in that court action, the dangerous nature of the material-and indeed, had it not been dangerous,
the federal Government would never have agreed to remove it from its existing site-how could the Government ever contemplate storing it on that site in that fashion?
When I asked the Minister of Finance (Mr. Lalonde), answering for the Minister of Energy, Mines and Resources about the issue, he said that a number of Conservatives had opposed the storage of the material in some other location. Atomic Energy of Canada is in the process of producing and licensing the use of radioactive materials in Canada. There has to be some place where that material can be stored. If the federal Government cannot find a suitable location for low level radioactive waste, what in the name of heaven will it do with the uranium bundles at hydro projects? Where will they be stored? It is very clearly time that the Government awakened to its responsibilities and stored this material where it will not result in injury to the inhabitants of the immediate area.


Leonard Donald Hopkins: Mr. Speaker, the work to date of the Low Level Radioactive Waste Management Office has concentrated on the cleanup of historic wastes in Malvern and Port Hope, Ontario and in Surrey, B.C. I would like to specifically address the Malvern case.
About 4,000 tonnes of slightly radioactively contaminated soil, for which no permanent disposal site exists, is currently located on residential properties in the Malvern subdivision of Scarborough. In 1983, the Canadian and Ontario Governments signed a Memorandum of Understanding under which the federal Government assumed responsibility for removing the soil to permanent disposal when a disposal site could be established. Ontario, preferring that the removal of the soil from Malvern take place without waiting for the establishment of a disposal site, agreed to co-operate with the federal Government by identifying a temporary storage site for the soil, and agreed to incur the additional costs involved in taking the additional step through storage prior to going to disposal.
The Hon. Member has made an attempt to dump the whole problem on the federal Government. I must remind him that the provincial governments have a very great responsibility in this particular field. Indeed, there was a lot of opposition to the disposal site that was selected. I think the Hon. Member is well aware of those Conservatives who opposed that, along with the general public.
The federal Government, with Ontario's agreement, named the Low Level Radioactive Waste Management Office of AECL as the agency to carry out the work. The Malvern removal has been delayed because of an interim court injunction obtained by a group of residents near the temporary storage site.
The federal Government is now actively addressing all aspects of the management and disposal of radioactive wastes in Canada. It has been doing that for some time. The Hon. Member must be very much aware that this is a very emotional topic for the general public. It is very difficult to find a satisfactory site. Much work remains before a complete oper-
June 7, 1984

ating system is in place and the co-operation and support of provincial and municipal governments, industry and the public is crucial to reaching that goal.
For the past five years, Atomic Energy of Canada Limited has been managing a major research program into the permanent passive disposal of irradiated fuel waste deep in the stable crystalline rock of the Canadian shield. The preliminary research results from this program support the view that nuclear fuel waste can be safely disposed of in this manner. A lot of research has gone into this field. I do not want the impression left that anyone has been dragging his feet on this issue.
This research is a joint program which is being performed under the terms of the Canada/Ontario Agreement of June,
Adjournment Debate
1978. Under this agreement, Ontario Hydro is responsible for the work required on storage and transportation of irradiated fuel. A further federal-Ontario agreement in August, 1981 defined the evaluation process leading to acceptance of the disposal concept proposed.
In closing, I would just like to say that the Hon. Member mentioned the Liberal Member from the area. I can state that he has been very communicative on matters relating to his constituency.


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


[Stage Direction]
The House adjourned at 6.28 p.m.
[Stage Direction]
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[Stage Direction]
Friday, June 8, 1984