1985-10-15

[Stage Direction]
The House resumed from Friday, October 11, consideration of the motion of Mr. Crosbie that Bill C-78, an Act to amend the Governor General's Act, the Governor General's Retiring Annuity Act, the Salaries Act and the Judges Act, be read the second time and referred to a legislative committee.
Mr. Dan Heap (Spadina):: Mr. Speaker, this is principally a Bill to increase judges' salaries, as well as those of the Governor General and Lieutenant-Governors. It refers as well to pensions along with salaries. What I want to speak about, however, is the salaries of judges. As the Government itself notes, notwithstanding this Bill it has put forward, there is the problem of spending restraint.
What we have here is a proposed raise in salaries for the judges retroactive to April 1 of this year. For example, the chief Justice of the Supreme Court is now receiving $117,000 annually with a cost of living adjustment capped at 7 per cent. His salary goes up by 7 per cent or the cost of living each year, whichever is less. At present inflation is less than 7 per cent but it will go up by 3 per cent or 4 per cent next year no doubt. However, this Bill proposes that his salary be increased to $135,000 retroactive to April 1, and I understand the cost of living increase would continue. The salaries of other judges of the court go up from $108,400 to $124,000, again retroactive to April 1. In the Superior Court, the Chief Justice now gets $101,800 and that will be increased to $113,900. Puisne judges will have an increase to $105,000. The chief judge of a district or county court will receive $108,900 and the salaries of other judges, now at $86,900, will increase to $100,000. In addition there is what is called the representation allowance. Judges are sometimes called upon to act in a public way and travel, and most of them are allowed up to $5,000 for representation costs. That will now be doubled to $10,000.
There are, Mr. Speaker, somewhere between 700 and 800 judges covered by this Bill. That, of course, is not a very large number in a country of 25 million so it can be argued that the money involved is not a great amount. It is not like the $1 billion being paid to bail out the banks. It is not like the $1
billion being given to the oil companies. However, there is a principle involved, that of restraint. These increases amount to 12 per cent or 15 per cent. That is a remarkably large increase compared to what almost every other public servant receives. It is a remarkably large increase compared to what ordinary wage earners and professional people in private employment receive. It is a shockingly large increase when compared with what is happening to people on mother's allowance.
Now, we are told that there is a problem. The judges have a problem which requires special consideration. They have a cash flow problem. I understand they need to spend more than they receive and therefore they have a cash flow problem. This problem is very easy to understand. A great many people in the country have the same problem. For example, there are millions of mothers in this land, whose income is only a small fraction of that of the judges, who have cash flow problems. There are thousands of mothers in my riding of Spadina who receive the family allowance and have cash flow problems. They have it every day when they go to the grocery store and every month when they pay the rent. Of course they are not the only ones, but I mention them particularly because the Government has decided that this country is so poor that it must reduce the effective income that mothers receive from mother's allowance by 3 per cent every year.
[DOT] (i HO)
There are others who are affected less directly. For example, many people need legal aid but the budgets for legal aid offices are being cut back or, at best, frozen rather than increased in accordance with the cash flow problems of the lawyers and other workers in those legal aid offices. They would like a little more money to pay the higher prices because they have a cash flow problem. Of course, that does not fall directly under federal jurisdiction, but some of the problems that require people to use legal aid are under federal jurisdiction.
For example, people come to my office who have immigration problems with the federal Government. They may be getting a raw deal through a mistake or perhaps through a bias in the administration. They may need the services of a lawyer, but very often new immigrants cannot afford that and must go to legal aid. There they run into these people with the cash flow problems. Both the legal aid clinics and the people who work there have that problem and it makes it difficult for them to give service to the people who need legal aid in order to argue their case before the immigration commission.
People who have trouble with unemployment insurance have difficulty getting legal aid because of the cash flow problem of the legal aid clinic. The same applies to pensioners. It occasionally happens that a pensioner cannot get his or her prob-
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October 15, 1985
The Governor General's Act
lem resolved, even with the help of an MP or another helpful person on a voluntary basis, and must get a lawyer. Once again they run into a cash flow problem.
Now that the grape boycott has been launched in Parliament today there will be some difficulties between boycotters and stores. There may be some controversies arising out of that and there may be some people who will need legal aid to defend themselves against an over-hasty charge laid by the police who are trying to keep order on the picket line. They will come to the legal aid clinics and find that there is a cash flow problem.
My point, Mr. Speaker, is that just about everyone of whom I have heard has a cash flow problem. I do not know whether the President of the Bank of Montreal has a personal cash flow problem because he has not told me, but the people who come to my office have cash flow problems and most of them receive only a quarter or an eighth of the income that judges now receive. Therefore, I think that their cash flow problems are much more serious than those of the judges.
My Party and I feel that this is not the right time to give the judges such a big raise. It may be that in times of affluence we can give them a little more, but at this time of restraint when we are cutting back family allowances and so many of the programs which help ordinary working people, all of whom have cash flow problems, it is not right to be raising the pay of judges by the astonishing amount of 12 or 15 per cent retroactive for nearly a whole year. For instance, if the Government were persuaded by the public of Canada to withdraw its legislation that will reduce the family allowance that is available to mothers, as it wisely did in June with respect to pensions, and if it withdrew other forms of taxation, such as increased sales tax, which bears so heavily on working people, I think there would be a better environment and a better public attitude within which to increase the judges' pay by this or some other amount. However, I suggest it would seem monstrously unfair to do so at this time.
While I am not a lawyer, I would suggest that it seems unjust to give an extra large increase to people who already have more while we are taking away from the people who already have less. We know that there is a saying in the gospels that, "To those that have shall be given and from those that have not shall be taken away" but whatever that means, that was meant to be the action of God, not the action of this Parliament. On the basis of our Charter, we certainly cannot find any justification for taking money away from mothers on family allowances and giving it to judges who already earn five or even ten times as much.
If the Government wished to amend this Bill so that the judges' salaries would increase according to the cost of living minus 3 per cent, I and I believe other Mmeber of my Party would be willing to take a very fresh look at it. I am not sure that the cost of living or Consumer Price Index will be this year perhaps 3.5 per cent, but if that is the case the judges would receive the same increase as mothers, that is, 0.5 per
cent. I suggest that most people would consider that to be reasonably fair. While it may be a perfect solution for mothers or judges, most people would agree that it would be fair.
Furthermore, since judges are in the business of justice, I hope even they would suggest that it would be a just decision, especially since some of the judges are women and perhaps mothers. I hope even they would suggest to the Government that a just compromise would be that judges' pay not be increased as proposed but rise each year by an amount equal to the Consumer Price Index minus 3 per cent so long as that is the formula being applied to the mothers of Canada.


The Acting Speaker (Mr. Paproski):: Is the House ready for the question?


Some Hon. Members:: Question.


The Acting Speaker (Mr. Paproski):: Mr. Crosbie, seconded by Mr. Hnatyshyn moves that Bill C-78, An Act to amend the Governor General's Act, The Governor General's Retiring Annuity Act, the Salaries Act and the Judges Act, be now read the second time and referred to a legislative committee.
Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: On division.


[Stage Direction]
Motion agreed to, Bill read the second time and referred to a legislative committee.

Hon. Don Mazankowski (Minister of Transport) moved: that Bill C-75, An Act to amend the Canada Shipping Act and to amend the Arctic Waters Pollution Prevention Act, the Maritime Code Act and the Oil and Gas Production and Conservation Act in consequence thereof, be read the second time and referred to a legislative committee.
He said: Mr. Speaker, the amendments which are contained in Bill C-75 which I am introducing today will reaffirm the Canada Shipping Act as the principal Act of Parliament dealing with safety of shipping, the preservation of life at sea and the protection of the marine environment in Canadian waters and fishing zones. The last time major amendments were made to the Canada Shipping Act was in 1971. These dealt specifically with pollution from ships. The Liberal Government of the day was jolted into taking stopgap measures by the tragic events surrounding the break up of the Arrow. As all Hon. Members will know, there is considerable demand for and widespread interest in these amendments by all sectors of the marine industry and the maritime bar. For example, there is an immediate requirement for amendments to the Canada Shipping Act to enhance safety at sea; to enable Canada to deal more effectively with matters associated with marine pollution; to allow for the Government to consider charging for certain Coast Guard services; and to give effect to important
October 15, 1985

international marine conventions, such as the 1978 Protocol to the Safety of Life at Sea Convention, the Convention of Standards of Training, Certification and Watchkeeping for Seafarers and the Convention for Prevention of Pollution from Ships. Most Hon. Members will be aware that Canada has been unable to ratify and hence become a party to these conventions because of not having the necessary enabling legislation.
In layman's terms, apart from those amendments of an administrative nature, what I am proposing today relates principally to health, safety, recovery of costs and financial protection for individuals, all of which are of concern to everyone associated with maritime transportation and trade in Canada. As well, the two items announced last year as part of the Government's restraint program are included in this legislation.
First, in order to avoid unnecessary duplication of ship inspections, the amendments will enable the delegation of routine inspection of ships to classification societies. This of course will be done in accordance with our regulations. Safety equipment will continue to be inspected by the Coast Guard. This will amount to a cost saving of some $200,000 annually.
Second, amendments are also included which would permit the option of transferring the provisions of port warden services to the private sector. If this option is exercised, cargoes will continue to be loaded and inspected in accordance with the regulations made under the Act, but the actual inspections would be carried out by private sector surveyors.
Another very important provision provides for the enabling authority for the recovery of certain Coast Guard expenses for services such as ice-breaking, escort services and aids to navigation.
Perhaps, in introducing this provision, it is necessary to take a few minutes to elaborate on the services which I have mentioned. I am sure Hon. Members on both sides of the House may be somewhat amazed at the depth and breadth of Coast Guard activities presently provided at virtually no charge to the maritime community. The Coast Guard provides a multiplicity of services to the marine sector. These include a sophisticated system of aids to navigation; radio aids and maintenance of ship channels; ship movement systems, such as the vessel traffic services and a network of radio stations; and ice-breaking services for commercial shipping, flood control and support of arctic operations. The Coast Guard is the principal marine component for search and rescue operations, with particular emphasis upon the safety of pleasure craft through education on boating safety and regulatory activities which encompass the safety of shipping, including the examination and certification of personnel, the licensing and registration of vessels, and the inspection of ships and their cargoes. Additionally, the Coast Guard deals with pollution clean-up from marine-related sources and other marine emergencies.
The Coast Guard operates from bases in five regions across Canada. In support of its functions, it deploys a fleet of 86
Canada Shipping Act
vessels ranging from major ice-breakers to shore-based search and rescue lifeboats, some 34 helicopters, four hovercraft and one aircraft, plus a number of inshore rescue boats and various sized work boats.
The total operating and capital costs, including administrative costs, in the 1985-86 fiscal year for the Coast Guard are in the region of $824 million. This includes costs of $368 million for aids to navigation; $74 million for ship movement systems and services; $177 million for ice-breaking, Arctic and ship support services; $62 million for marine search and rescue; $37 million for regulatory activities including marine emergencies; and $72 million for public ports and harbours.
I would like to emphasize, Mr. Speaker, that the Canadian Coast Guard is a vital component of the marine transportation system, contributing to the safe and expeditious movement of shipping and, most important, the safety of life at sea.
I would like to make it clear, Mr. Speaker, that the introduction of charges for certain Coast Guard services and the concept of privatizing the port warden services would only proceed after consultation with interested parties in the public and private sectors. I will be directing my Department to establish a consultative committee, mandated to meet with groups across the country, including shipowners and their representatives; unions, shippers and shipper-groups, fishermen and their associations, and other representatives of the marine industry and users of the marine infrastructure.
Let me turn now to other details of the Bill. The amendments will provide for clear authority for vessel traffic zones and the procedures to be followed by ships in or about to enter such zones. The Bill also provides for the designation of marine traffic administrators and delineates the circumstances under which they may issue directions to ships in Canadian waters.
I would emphasize here that there is no intention to undermine or take away the authority of masters or pilots but instead, to work with these professionals to enhance the safety and integrity of the existing system.
There would be no additional financial expenditures, public or private, associated with vessel traffic services, as these systems are already in place.
Experience in administering Part XX, the pollution section of the existing Act, which was prepared on an urgent basis as a sequel to the Arrow disaster of 1970, has revealed serious faults and omissions, and these amendments aim to correct those faults and omissions. Further, through a lack of enabling legislation, Canada has been unable to implement and obtain the advantage of the assured compensation provided by two international conventions; the 1969 International Convention on Civil Liability for Oil Pollution Damage, and the 1971 International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage.
These amendments, Mr. Speaker, therefore provide not only improvements in pollution prevention from ships and the

October 15, 1985
Canada Shipping Act
arrangements for clean-up, but also a greatly improved scheme of liability and compensation for the victims of oil pollution damage.
For instance, if a 60,000-ton laden tanker importing crude into Canada experienced a spill today, the owner of that ship would be required to make approximately $8.7 million available to pay compensation for pollution damage; that is to say, the maximum amount available would be $8.7 million, plus any moneys that there might be in the maritime pollution claims fund. The balance of that domestic fund is currently approximately $110 million. On the other hand, there would be assured compensation of $60 million from the two aforementioned international conventions and $100 million from the maritime pollution claims fund.
Improvements are to be made to the maritime pollution claims fund, which will be renamed the ship source oil pollution fund, whereby small claimants, such as fishermen and resort owners, will in future be able to claim directly against that fund.
Compensation for a ship other than a laden tanker will be at least $100 million, provided from the Canadian fund.
Within a similar context, Mr. Speaker, the powers of pollution prevention officers to board ships will be modified to conform to the inspection provisions of the International Pollution Convention. They will also be authorized to delineate emergency zones and to control traffic within those zones and, in cases where there is the likelihood of a spill, order any ship to move or to proceed as directed, and also, for purposes of prosecution, to obtain samples of pollutants from ships without first having to obtain a search warrant.
Additionally, to comply with the recommendation of the Auditor General, designated officials will be empowered to enter premises to inspect the books and financial records of contributors to our own domestic oil spill compensation fund.
Included in these amendments providing for discretionary authority for officials, the Board of Steamship Inspection would be able to permit adoption of equivalent standards in respect of such items as the structural strength of ships and equipment or exemption from regulations where this may be deemed desirable or appropriate. The board would also be empowered to prescribe interim standards for the carriage of dangerous goods in bulk for new substances for which standards do not exist and where time does not permit the making of a regulation.
With reference to dangerous goods, Hon. Members may wish to note that the amendments will provide for more effective regulation of the carriage by sea of dangerous goods in bulk by bringing the provisions of the Act into line with the Transportation of Dangerous Goods Act. Bulk cargoes will continue to be regulated under the Canada Shipping Act while packaged goods will in future be regulated on a multimodal basis under the Transportation of Dangerous Goods Act.
With respect to safety at sea, the amendments will promote safety and more efficient navigation. For instance, they will enable the introduction of new and improved standards for the training and certification of seafarers including, very importantly, special qualifications for service on ships such as oil and chemical tankers and mobile offshore drilling units. I think Hon. Members only have to recall the tragic events of the Ocean Ranger, the Hudson Transport and the Cartiercliffe Hall to understand the importance of this amendment which will enable the adoption of recommendations on safety training, made by these formal investigations. There will be some additional cost to both industry and Government in undertaking this training but this must be balanced against the benefits in terms of safety and environmental protection.
Specifically, the cost of training in respect to seafarers of the industry would be in the magnitude of $24 million over the next five years and for employees on civilian government ships it would be in the magnitude of some $4.8 million over the same five-year period. The cost for employees on government ships will be absorbed by appropriate Departments such as the Departments of Transport, Fisheries and Oceans, National Defence and Public Works, and of course the cost to the private sector will be absorbed by the individual firms. It is far easier to put a dollar figure on the cost of training and prevention than it is to estimate the price we may pay in loss of lives and irretractable damage to the environment if we do not proceed in this area.
With respect to ship integrity, particular standards for the construction and equipment of mobile offshore drilling units and special purpose ships have been adopted internationally. These amendments will enable Canada to implement these standards. As well, the amendments provide for the implementation of the 1978 Protocol on Tanker Safety and the 1974 Safety of Life at Sea Convention regarding such matters as inspections, steering gear, fire protection and navigational equipment.
In addition to the foregoing, there are a number of other amendments relating to dynamically supported craft such as air cushion vehicles, tonnage measurement, abolition of hard labour as a penalty under the Act, restricted application of rules and regulations, the recording of Government ships in the shipping registry and a provision that would enable foreign flag ships to be exempted from the prohibitory provisions of the Act relating to the coasting trade when suitable Canadian ships are not available. This latter provision has been in place since 1973 and is retained as an interim measure for use until such time as a separate coasting trade Act is developed, a point I shall address later in my remarks.
It should be noted that the Bill is drafted to permit the regulation of matters relating to drill ships and structures, their construction and equipment and training and certification of personnel on board while actively engaged in exploration and exploitation on Canada Lands to be regulated under the Canada Oil and Gas Act. At all other times, these vessels will be regulated under the Canada Shipping Act.
October 15, 1985

I am sure Hon. Members would appreciate my referring to other aspects of marine-related legislation mentioned in my recent discussion paper on economic regulatory reform entitled Freedom to Move. The Shipping Conferences Exemption Act, 1979, was extended for a further year by the Government and now expires on March 31, 1986. I am anxious that some of the uncertainty surrouding the future of this subject be dispelled as soon as possible since proposed revisions to the legislation in one form or another have been under discussion for some time now both by the previous Liberal administration and by this Government. I therefore propose to present a revised shipping conferences exemption Bill to Parliament separate from and ahead of revisions to the National Transportation Act with the hope that Parliament will dispose of the subject before the most recent extension to the Shipping Conferences Exemption Act of 1979 expires.
A further item referred to in Freedom to Move that I intend to put before Parliament before the new National Transportation Act is introduced is a Bill concerning amendments to the previously mentioned Coasting Trade Act of Canada. I should explain that coasting trade provisions are now covered under Part XV of the present Canada Shipping Act, and indeed the amendments to the Canada Shipping Act which I am proposing do in fact contain an amendment to Part XV, which is necessary to correct a technical problem which is of some concern. However, the amendment is only there to remove any doubts about the legality of existing practices.
Consistent with Freedom to Move, the new coasting trade Bill will, among other things, extend the jurisdiction to 200 nautical miles or to the limit of the continental shelf, whichever is greater. It will expand the scope of the act to include all commercial marine activities except fishing, yet it will still retain a waiver system to allow foreign flag ships to satisfy temporary requirements.
Last, Freedom to Move made references to the Inland Water Freight Rates Act and the Transport Act. I propose to deal with the future of both of these pieces of legislation when the new National Transportation Act is introduced to Parliament some time early next year.
It is more important at this particular time that the House deal expeditiously with what I am proposing today. As I said earlier, the Canada Shipping Act is the principal Act of Parliament dealing with the safety of shipping, the preservation of life and the protection of the marine environment in Canadian waters and fishing zones. As outlined, it deals with such diverse matters as vessel ownership, tonnage measurement, certification and training of seafarers, construction and equipment of ships, safe navigation, civil liability, cargoes, the prevention of pollution from ships and compensation for the victims of oil pollution damage. Its provisions ensure that all ships entering Canadian waters and using our ports comply with standards that provide a high degree of safety and efficiency.
These amendments, which have taken considerable time to develop, have been widely discussed and generally endorsed by all interest groups including ship owners, shipbuilders and
Canada Shipping Act
repairers, trade unions, the oil industry, fishing interests and other agencies of Government. I believe the Bill goes a long way toward modernizing an outdated piece of legislation and making it responsive to today's needs.
Canada is fortunate to have a solid reputation within the international maritime community. In fact, I am proud to note for Hon. Members that Mr. Bill O'Neil, the President of the St. Lawrence Seaway, was the first Canadian elected as Chairman of the Council of the U.N. International Maritime Organization in 1979. He was subsequently re-elected to this position in both 1981 and 1983.
Let me reiterate to the House that there are approximately 12 major international conventions and codes that Canda cannot effect until these amendments are passed. The maritime community, both at home and abroad, awaits these amendments to bring this legislation governing the seafaring trade into 1986 and beyond. This legislation will re-establish Canada's credibility in the marine sector. I therefore call upon all Hon. Members to give expeditious pasage to this Bill.


Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, in looking at this Bill, which is quite an elaborate piece of legislation that cannot be absorbed very quickly, my impression of which 1 would like to speak today is that the Government of Canada is expecting a growing volume of year-round oil tanker shipping in Arctic waters. I will address the subject of the Arctic in the next few minutes. As well, the Minister has given a much broader and more comprehensive perspective to the Bill than the one I will develop.
The reality of the South is one thing and the reality of the North is another. It seems to me that the Minister needs to be sensitized to some of the realities of the North in view of the fact that by amending the Arctic Waters Pollution Prevention Act, this Bill spells bad news for northern people and the northern areas of the country from an environmental point of view. I would like to provide the Minister with some background on this. He has referred to the groups with which he has consulted or intends to consult. He did not make a reference, at least I did not hear him make any reference to the native people. I would like to refer him to some documentation of which his Department ought to be aware, beginning with the Lancaster Sound regional study of November of 1983. It is a document which embodies a public review. It consists of public consultation, and I will just put on the record a few selected passages because they seem to be quite relevant to this Bill which will generate growing volumes of year-round tanker shipping in the Arctic. George Eckalook, speaking on behalf of the Resolute Bay Settlement Council, stated:
-the settlement wants Lancaster Sound to stay in its present state and not be touched at all. The people of the settlement want to protect the environment, they want to learn more, to consider the possibility of parks, and to wait for the Nunavut land claims settlement. They are concerned about the possible use of icebreaking ships moving through the Sound during the winter and are frightened by the possible explosion of natural gas being carried by these ships.

October 15, 1985
Canada Shipping Act
Sampson Akpaleapik, a student in grade nine at the Takijualuk School in Pond Inlet, expressed on the same occasion an opinion that, and I quote:
-if there was an oil spill in the Sound the fish would suffocate. The narwhals, seals, and other sea animals would die out. If there was an oil spill, the marine currents would spread the oil rapidly killing the animals that the whales, seals, and walruses eat. Even if there was no oil spill, the noise of the ships' engines would scare the animals away.
Maggie Allooloo, speaking on behalf of the Development Review Committee of the Hamlet Council of Pond Inlet, stated emphatically and I quote:
-the Council does not want development of non-renewable resources at this time. Even with planning, heavy controls, and strict regulations, the Development Review Committee feels that activity associated with non-renewable resource development would grow beyond what the environment and the people could tolerate. The Committee is in favour of option two as outlined in the Green Paper, and after land claims are settled, the final decisions on the National Park in the area could be worked out.
Charlie Inuarak, speaking on behalf of the Baffin Region Inuit Association, reviewed the association's positions with respect to conservation, uncertainty about impacts, and the narrow definition that equates national interest to Canada's energy supply. He stated:
The key question for BRIA is: do we choose to put the Lancaster Sound Region at risk? In response, BRIA contends that if we are serious about the principle of the maintenance of biological productivity and environmental quality, then no hydrocarbon activities should be allowed to proceed in the Lancaster Sound Region.
You can appreciate, Mr. Speaker, that the Lancaster Sound would be right smack in the middle of many of these shipping movements if they were to take place. I am sure you, Mr. Speaker, and the Minister of Transport (Mr. Mazankowski), have seen the beauty and richness of that ecological body of water and you are aware of how fragile it is and how much it represents one of the last unique resources of this particular quality in the entire globe.
In the same document, a position was taken by the Canadian Arctic Resources Committee, of which, I am sure, the Minister is familiar, as an organization with which he intends to consult or has consulted. The report reads as follows, first:
That the moratorium on exploratory drilling and year round shipping be continued until a satisfactory regional planning process and a northern conversation policy are in place;
Second:
That the establishment of a planning process recognize the political development and land claim initiatives which are now taking place in the Northwest Territories.
And third:
That all immediate decisions regarding Lancaster Sound be made in line with the general principles that CARC developed in 1979.
We have here, Mr. Speaker, an input from North by people who live there are who follow developments such as the Canadian Arctic Resources Committee which really seems to be expressing a viewpoint which is diametrically opposite to the direction in which this Government intends to go. I can only express profound disappointment in the absence so far of consultations with the organizations of the North and also with the Inuit Tapirisats and with the territorial Governments
as well as, perhaps, Environment Canada or the Department of Indian Affairs and Northern Development.
I believe it is essential, Mr. Speaker, that a thorough consultation, which has not taken place up to now, be part and parcel of the examination of the Bill after second reading so as to allow input from the people in the areas affected and the consideration of lifestyles and cultures which are going to be affected if this Bill goes through and eventually leads to growing volumes of year-round oil and tanker shipping.
There has been a draft Green Paper on Lancaster Sound and the North. There has been Lancaster Sound regional study. There has also been a Green Paper on the Lancaster Sound region 1980-2000. It is basically this Green Paper I would like to be sure the Minister is familiar with. It needs to be examined in the light of the main thrust of this Bill, which is to increase liability and compensation and to destroy the ecology and lifestyle in the North by the tanker traffic which will inevitably lead to serious consequences.
I am told that the Inuit Tapirisats Organization feels very strongly about any activity which would contemplate tanker movement through Lancaster Sound, and that the public hearings so far did determine an attitude which rejected that notion. The Inuit Tapirisats, as an organization and as individuals, would be simply outraged, if, after second reading, consultations had not taken place in committee and a decision made.
I realize that will be a very difficult situation to resolve by the Minister in the application of this Bill if he intends, as it is my assumption he does, to increase the volume of year-round tanker shipping in the Arctic. That will mean that once again we will have imposed our values and our economic goals on a culture which so far has managed to survive under very difficult circumstances and in a very fragile ecological set-up. Basically, this tends to reject our exploitation of the natural resources in the way we do it as a white society. There is a very strong commitment to finding ways of exploiting our renewable resources, but certainly in my experience there is a rejection of the exploitation of oil and gas in a manner which will cause damage to the environment which no amount of compensation can adequately repair. We all know the beauty of Lancaster Sound and I can hardly imagine anyone in his right mind who would want to see any damage caused to that beautiful body of water. It is one of the most striking of its kind in the world, and increasing liability and compensation from present levels to the highest amount any Government could afford is not really coming to grips with the important ecological and cultural question before us, namely whether we want to move into that environment and pollute it. Regardless of the good intentions and the prevention schemes which may be in place, cleaning up marine pollution in the Arctic is virtually impossible once the damage is done. It is difficult to do that even in our climate and latitude, as our experience off the Atlantic coast some 10 years ago has shown. It is virtually impossible to do it in our Arctic areas once the spill has taken place.
October 15, 1985

It is therefore necessary to bring this to the attention of the Minister of Transport and ensure that he has the support of his colleague, the Minister of the Environment (Mr. McMillan), as well as the Minister of Indian Affairs and Northern Development (Mr. Crombie). He has to ensure that a proposal of this kind also has the full support and understanding of the territorial Governments. Beyond that, the bottom line is that he has to have the support of the native people in the regions affected. My impression is that, by and large, the native communities in the North would reject the notion of a year-round oil tanker route for the reasons I have already identified by way of quotations from the Lancaster Sound Regional Study produced by the Department of Indian Affairs and Northern Development. Evidently the attitude of people up there is one that rejects any activity which would have the potential to damage permanently the ecology and the environment per se.
I urge the Minister to travel to and consult with the people in communities like Pond Inlet and Tuktoyaktuk and Grise Ford and others in order to see with his own eyes the ecological reality. Standing in the North and looking south gives you a perspective quite different from that of standing here in this House and looking North. I am sure that if he were to do that, he would have profound doubts about the advisability of using this Bill to increase year-round oil tanker traffic.
The reason I raise these questions is that I know the Minister is a democrat, he listens to people and he wants to be fully informed about the implications of any measure he brings to Parliament, not just from the perspective of the industrialized South but from that of the North. My impression is that if we were to tap the oil and gas resources of the North, we could get the support of the native people there if we did it by land, if we were to do it by way of pipelines, which are operated under strict controls, well-regulated and environmentally safe. That is where the thrust has been for some time. But when it comes to the alternative of doing it by sea where the possibility of an accidental spill is increased many, many times, then we are talking a completely different approach. This can only be fully understood if you stand, for example, on a hill in Pond Inlet and look out over Lancaster Sound. This is unique water body, ecologically speaking one of the richest in the world. Then try to envisage a tanker route moving through that part of our Arctic. It is unthinkable. Therefore, I submit that we should be extremely careful in laying the foundations for such an initiative which would have such profound consequences on the lifestyle and ecological riches of our North.
The main thrust of this intervention on my part today is to impress upon the Minister and the Government the absolute necessity of thorough consultations with the native people. It is of the greatest importance that this Bill be explained to them. It is difficult for us to fathom it in all its details here today, and one can only imagine what difficulty it poses to people who live several thousand miles away. It is important that the Bill be understood, because a one-page press release cannot do justice to a Bill which runs some 106 pages and which contains
Canada Shipping Act
a very important chapter on pollution prevention and control and which has politically, I suspect, some profound and longterm implications. Therefore, the Minister of Transport and his Government owe this House as well as the affected communities a thorough explanation as to what the long-term policy of this Government is in relation to year-round oil tanker traffic in Arctic waters. This is the basic policy direction which has to be understood on second reading of Bill C-75.


Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, it is my pleasure to rise to speak on Bill C-75, an Act to amend the Canada Shipping Act, among others. I do so in my role as my Party's spokesperson for marine activities and, in particular, for the St. Lawrence Seaway. While this Act is basically an effort to bring the marine industry into the twentieth century, I believe it has one serious flaw. Before I get to that, I would like to say that the matters raised by the Government in this Bill are extremely important. I agree with the Minister that we should move them through the House and committee as quickly as possible. However, we may have some difficulty with this one flaw.
Bill C-75 takes the former Government's user-pay philosophy for the St. Lawrence Seaway and expands it into the Conservative Government's philosophy for cost recovery on the remainder of the marine industry in Canada. Clause 4 of this Act gives the Government the power to require that any amount up to 100 per cent of the cost of providing Coast Guard services be passed on to the users. It is important to this debate, Mr. Speaker, that 1 read the clause that I am so concerned about. It reads:
3.1(1) For the purpose of defraying the cost of navigational services provided by the Canadian Coast Guard, the Governor in Council may make regulations respecting charges relating to those services, including, without limiting the generality of the foregoing, aids to navigation, dredging, vessel traffic services, ice breaking services and escorting services.
(2) Charges may be imposed pursuant to subsection (1) in relation to any ship or vessel, regardless of whether the Canadian Coast Guard actually provides a navigational service to that particular ship or vessel.
Those are fairly broad powers given to the Minister of Transportation (Mr. Mazankowski) and Cabinet. 1 want you to understand, Mr. Speaker, that regardless of my comments and those of my colleagues who will follow me, this Bill does have considerable support. In fact, this particular clause has support in every country that competes with Canada in the world market for sales of grain, coal, potash, and other bulk commodities. They support the Bill because they know that the imposition of yet another user-fee policy will make Canada and Canadian exports less competitive on the world market. They know that such a policy will make our grains more expensive, that our potash will increase in price, and that it may put some of our producers out of business over the long term. If you like, Mr. Speaker, they welcome a permanent elimination of their competition.
It was with no surprise, Mr. Speaker, that I discovered this particular clause in the Bill. It was clear from this past spring's

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federal Budget that the Conservative Government was going to pursue the Liberal Government's cost recovery philosophy. The decision by the Minister of Finance (Mr. Wilson) to skim $30 million from the assets of the St. Lawrence Seaway Corporation was a clear indication that Seaway tolls would have to rise. I would, however, like to acknowledge and congratulate the Minister of Transportation for having indicated in the House last week that that matter was under review. It is clear that he has an understanding of the needs of the Seaway and the marine industry and is prepared to go to bat for them at the Cabinet level. I encourage him to continue to do so.
I am not surprised that the Government is following the Liberal's philosophy of user-pay. I am, however, disappointed that the Government would bury this clause in this particular Bill, which otherwise, as I mentioned before, is, on the whole, worthy, albeit long overdue, legislation. However, I am not surprised. Although I am surprised that the Minister of Transportation would allow his name to be associated with this particular Bill. When I used to watch Parliament while I was trying to get here I heard the words that the Minister himself used to chastise his predecessor, Otto Lang, on this subject. He said:
Consider the record when it comes to fulfilling the commitments which were made. What has become of those sweeping plans, those radical departures from past methods, those comprehensive programs we heard so much about? What became of the idea of world leadership in transportation? We can probably summarize all this in one phrase: all we have received following these lofty promises amount to nothing more than the Otto Lang user-pay concept.
I go back further into history to June 16, 1958. The Speaker of the House was the then Member of Parliament for Niagara Falls, Mr. W. L. Houck. He was quoting history. Back in 1934, Mr. Speaker, there was a full debate in this House on the motion that all goods shipped through canals owned and operated by the Government of Canada be subject to taxation.
In speaking against the motion, the Hon. R. J. Manion, MP for Fort William from 1917 to 1940-which riding was the predecessor of the riding of Thunder Bay-Atikokan which I now hold-former Leader of the Conservative Party and, at the time, Minister of Railways and Canals, stated in part:
In regard to the Panama, Suez, and Manchester Canals, it is true that they collect tolls. We must realize, however, that the conditions under which these canals are operated are altogether different from those existing in connection with Canadian canals. The Manchester Canal is a private commercial enterprise, whereas in Canada our canals are national. Then the Suez Canal is operated by a privately owned company. True, the Panama Canal is publicly owned and operated, but we must remember this important point: The difference between the Suez, the Panama and our Canadian canals is that no vessel owner is forced to use either the Suez or the Panama.
On the other hand, in Canada we have no alternative water route from the western grain fields, unless one wishes to use the railways from the head of the lakes. As has already been pointed out, however, the railroad would be so much higher that it would not be possible in the marketing of grain. It is important that we should have the lowest possible rates in order that we may compete with countries whose grain fields are closer to the seaboards than are the fields of Canada.
Those words, Mr. Speaker, were no more true in 1933 or 1958 than they are today. In fact, those same words have been echoed by industry spokesmen over the last year as they have warned the Government that it has put the Seaway on the road
to ruin. It is perfectly clear that when we increase transportation costs, whether by increases in fuel costs, taxes, tolls, labour, or materials, those costs ripple through the economy.
The transportation company itself is affected in that it is less able to compete, particularly against other modes, for the movement of, in this case, bulk commodities. The producer, whose products are no longer as competitive in the domestic and foreign market, is directly impacted upon. Due to declining demands for the goods that workers handle, they have less employment and, therefore, less income to spend on consumer goods. Canada as a nation is affected because of a reduction in exports and, therefore, a shift in the balance of payments, because of a reduction in income and corporate tax paid, and because of an increase in the cost of income support programs such as unemployment insurance and welfare that must be paid out to support those laid off workers.
In 1958, the MP for Welland, another riding in this country which has a very direct relationship to marine industry, Mr. W. H. McMillan, said as follows:
As Members of Parliament, we should be interested in the costs of vessel operation in so far as they relate to the cost of moving cargo. We should consider what effect this cost may have on industry generally, on agriculture and commerce. We should be interested in the shipping industry because of the thousands of men who are engaged as seamen and because of the shipbuilders and suppliers, in the same way that we should be interested in the welfare of Canada generally.
I have often read that 40 per cent of our workmen depend for their livelihood on our foreign trade, and I believe that if we are to have a continuing prosperity in this country we must have an expanding trade. The St. Lawrence River and the Great Lakes basin, which extends to the very heart of our continent, a distance of 2,900 miles to the sea, are Canada's greatest single outlet to the markets of Europe, the eastern coast of the United States and South America. Much of the trade between Canada and the United States goes across this route. It is the most economical transportation system in the world and, because of its economy, it has helped to build our country. It has helped our farmers to market their wheat in highly competitive markets, even though that wheat is grown thousands of miles from the seaports. It has also helped our industry to assemble raw materials to manufacture products and to enter competitive markets. Today this water transportation system is becoming even more important to the economy of Canada because of the prospective shipping of large tonnages of iron ore from Quebec and Labrador to steel centres along the Great Lakes in both Canada and the United States.
The following also was stated:
One must agree that ultimately tolls are always paid by the consumer, whether he knows it or not. They are included in the cost of transportation and eventually wind up in the price charged for the product. In the case of our basic materials the added cost of transportation through tolls increases in proportion to the number of processes through which the material passes before it finally goes off the dealers' shelves. It is thus cheaper, to say nothing of less painful, for all of us to pay for waterway improvements just once through taxes rather than repeatedly through the higher prices which would result from tolls on the Welland Canal.
That is a final quote from Mr. W. L. Houck, the M.P. for Niagara Falls.
I have a final quote in this series, dated March 12, 1959. It is from a gentleman well known to the House and to you, Mr. Speaker. He is still a Member of Parliament. The then Minister of Transport, the present Minister of Veterans Affairs (Mr. Hees) said:

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-this great inland water way will become operative with the opening of the navigation season this year and we have every reason to look forward to the material increase in the volume of shipping using these facilities. This should be of great assistance to the development of the commerce of this country as whole, and should enable goods produced in Canada to become more competitive in world markets. We look forward to the whole economy of Canada benfiting with the opening of this great Seaway project.
Although it is geographically located in the centre of Canada, clearly it is a national asset and should be treated as such. Throughout this debate my colleagues and I will try to put before the House our concerns over the negative impacts of this particular clause. We want to talk about its impact on the commercial fishing industry on the West Coast and the East Coast. We do not believe that those borderline operations can withstand another cost. We want to talk about the impact on recreational boaters as well as the boating industry itself.
Most specifically, we want to deal with its impact on commercial shipping throughout our nation. This will not only hurt the Seaway but will negatively impact on Churchill, Prince Rupert, Vancouver, Saint John, Halifax, Baie Comeau and Port Cartier. Each port and port community in this country will be affected by this Bill. The impact will be severe and nowhere will it be more severe than in the Great Lakes and the St. Lawrence system. In fact, I would go so far as to say that when taken in conjunction with other Government action to increase cost recovery, this legislation will kill the Seaway as a viable transportation entity.
In this respect, it is important not to look at the cost recovery measures in this Bill in isolation. We cannot just focus on Clause 4 of Bill C-75; we must look at it in the context of Seaway tolls, Seaway fees and pilotage fees. The Minister knows well, as does his parliamentary assistant, that the industry is howling about the cost increases that they are already facing through the proposed changes to the Laurentian Pilotage Authority as well as their fear that the Minister will not be able to replace the $30 million in the Seaway Authority.
As evidenced by this Bill, it is quite clear that the Government intends to follow this path of cost recovery. Just a few days ago in The Globe and Mail, a paper that is read occasionally by some Members in the House, an aid to the Minister of Transport is quoted as saying:
We're going to make Crown corporations stand on their own two feet.. . The users of the Seaway are going to have to pay most of the cost of the service they get.
Assuming that he was speaking on behalf of the Minister, it is unfortunate that he made such a statement because that kind of approach is not positive for the country and is certainly not positive for the Seaway. This Act gives the Government the power to recover the cost of services that are now provided or will be provided by the Canadian Coast Guard, regardless of whether those services are used by a particular vessel. These services include dredging, ice-breaking, the provision of navigational aids and the provision of ship escort services.
This clause in no way indicates the total extent of that cost recovery. Is it to be 10 per cent, 25 per cent, 50 per cent or even 100 per cent or more? It is my understanding that officials at the Thunder Bay Harbour Commission and offi-
Canada Shipping Act
cials from the Coast Guard have been in negotiation over dredging services for the Port of Thunder Bay all summer. They have been told that the Coast Guard wants to recover 100 per cent of the cost of dredging services within the harbour of the Port of Thunder Bay. Those charges, while levied against the Harbour Commission, will be passed on to the shipper who will pass them on to the producers. Therefore, everyone loses in that cycle.
There are a number of industries whose products are shipped through Thunder Bay and the rest of the Seaway. Their margin is so slim that they are negotiating and competing for pennies and barely able to make anything above the cost of labour. They are competing this way in order to keep in business because they recognize their value not only to the communities where their production originates but to the communities along the Seaway as a result of shipping those goods.
The vast majority of commodities that move through Thunder Bay into the Seaway originate in western Canada. In 1984 alone, 16.6 million tonnes of grain, 2.8 million tonnes of coal and 1.8 million tonnes of potash from as far away as British Columbia was shipped to eastern and foreign markets via Thunder Bay and the Seaway. In fact, in recent years the amount of coal and potash moving through the eastern gate of the Prairies has been on the increase, aided in part by the efficiencies of the Seaway itself. Each year, the Seaway generates $3 billion of economic activity for the ports on both sides of this international waterway.
According to the President of the St. Lawrence Seaway Authority, Mr. William O'Neil, the Seaway was built, "To serve the grain industry which is now a $6 billion earner of foreign exchange".
Undeniably, the Seaway is uniquely cost efficient for moving transportation intensive bulk products. For less than half the cost of rail, western grain can be loaded on to bulk carriers and shipped from Thunder Bay to eastern ports. Canada's key grain and steel industries demand a low cost bulk system to move their high volume products. The 3,200 kilometres of Seaway is an irreplaceable artery for these industries. Since its completion, the Seaway has moved well over a billion tonnes of cargo. In 1985, the Seaway handled 54 million tonnes through its Welland Canal and 47.4 million through its Montreal-Lake Ontario section. Today, the Port of Thunder Bay ships in excess of 23 million tonnes a year and is responsible for a third of the Seaway's traffic.
According to Robert J. Paterson, Executive Vice-President of NM Paterson and Sons Limited of Thunder Bay, on average, a ship will carry a tonne of cargo 125 per cent farther on a unit of fuel oil than a train, and seven times farther than a truck. Therefore, dollars and cents notwithstanding, in terms of our natural resources it makes more sense to encourage shipments by water.
The head of the grainhandlers in Thunder Bay, Frank Mazur, stated in one of their publications:
We have a world-class seaport on a world-class waterway. Our work force is one of the most productive in the world.
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When most Canadians think of grain, they probably think about the infamous Crows Nest Pass rate debate that was held in the House and across the Prairies a few years ago. 1 think the underlying message derived from that debate is that there is a belief in this country that the movement of a commodity like grain must be subsidized because our grain fields are so far from export positions compared to other countries whose ports are 30 miles to 40 miles away. They recognize that we must do something to overcome those obstacles. Perhaps they also recognize that we must ensure that new obstacles are not put into place which prevent products from going to market. Quite honestly, Clause 4 of Bill C-75 puts a very serious obstacle in the way of grain and other bulk commodities being competitive on the world market.
Mr. Donald S. Rothwell, President of the Great Lakes Waterways Development Association, recently said:
The Lakes-Seaway system must get competitive again, in a viciously price conscious world. In an environment where a quarter of a cent per tonne can make a difference, no cost is so insignificant it is inconsequential.
Lower costs are mandatory if traffic is to increase to the point where the Seaway's very stringent cost recovery mandate is to make any economic sense at all. .. Ill-conceived increases in user fees could be counter-productive and result in lower gross revenue to the Government while inflicting serious damage on industries that are already badly wounded by the economic downturn of the early eighties.
The Minister spoke earlier about wanting, once the Bill was passed, to go forth and seek opinions as to what the industry had to say about cost recovery. I respectfully suggest that it should be the other way around. He should have listened to the industry which has been saying for quite some time that it is concerned about the move to cost recovery. Mr. George J. Ryan, President of the Lakes Carriers Association, said:
User charges will wreak havoc on the Great Lakes transportation system and send shock waves through the whole economy. Great Lakes shipping has prevailed through the recession and preserved its assets for better times to come, but user charges could well be the death-knell of this proud industry.
In part, a publication of the Thunder Bay Harbour Commission read:
Excessive tolls have all but driven away the lucrative "general" or "manufactured" cargoes that plied the system in the sixties and seventies. If our Government transfer the costs for Seaway maintenance to the ports, the Seaway will be priced out of business.
Also, Robert J. Paterson from NM Paterson and Sons said:
The user pay cost recovery concept has an obvious political attraction for Government, but its implementation can have severe consequences in efficiency. Fuel surcharges and Seaway user fees pose a serious threat to ship owners and shippers. Private industry is intuitively wary of Government charging back costs when the level of the costs is not subject to the disciplines of the market. We, in the Seaway, are being penalized for being as efficient as we are .. . The Seaway should be treated like every other transportation mode in this country.
If we look at the highways are railroads of our nation, can we really say that they are being charged full cost recovery for their use? I doubt it. I would be very pleased to see a cost comparison, if the Minister happens to have one, showing the various subsidy levels by mode. Then we could take a look at the impact, particularly as it relates to the marine industry. Also Mr. Paterson said:
A greater percentage of the running of the Seaway should be picked up by the general public simply because the Seaway positively affects every citizen of Canada.
During the years of bumper crops in the Prairies or an abundance of grain sales, everyone is happy and everyone is working; grain is moving east, west and north to Churchill. However, during poor years such as last year the inequities or the system become more apparent. The 1984-85 crop was one of the worst in at least six years, if not longer, with a decline of some three million tonnes over previous years. Despite a commitment in the House by the Minister of State For Canadian Wheat Board (Mr. Mayer), the crop failure was not shared equally throughout the system. For instance, the Port of Prince Rupert saw its throughput decline by 26 per cent; Churchill, by 31 per cent; and Thunder Bay, by 29 per cent. On the other hand, Vancouver was down only 14 per cent over the previous year. While Vancouver was thankfully at full employment last summer, at the Port of Thunder Bay over 1,200 men and women in the grain handling and grain transportation industry were out of work. It was not only in Thunder Bay. Throughout the length of the Seaway, grain handlers and sailors were out of work last summer. The International Seafarers Union estimated that 2,500 of its members were laid off.
If we examine some of the eastern ports downstream, we have a better idea of the trickle effect throughout the country. In two ports in the riding of Manicouagan-and, Mr. Speaker, I am sure you are familiar with the person who represents it- 47.5 per cent of the workforce in the elevators was laid off last summer; in Halifax, 41 per cent; in Saint John, 70 per cent; in Quebec City, 29 per cent; in Trois-Rivieres, 12 per cent; and in Sorel, 60 per cent. Although those percentages are high, the numbers on a broad scale are fairly low. For instance, at Port Cartier, 47 people were laid off and at Baie Comeau 46 people were laid off. Those are smaller communities, and the effect is much greater than in larger centres. Certainly it is important for those 46 and 47 people who were out of work and did not have to be out of work. We estimate that approximately 3,900 people along the Seaway were out of work. When I say "along the Seaway", I am extending it into Manitoba and its rail workers, tradesmen and those at CN shops. People all through the system were out of work because of that inequity. Approximately 51 per cent of the industry was shut down. I suspect- and perhaps the Minister will be able to enlighten us about this later today-that because of the accident, which has shut down the Seaway for a length of time that no one is prepared to estimate, and I can understand the difficulty in doing it, we may see the situation occur again quite quickly where a large number of Canadians are out of work. The trickle down effect is also very severe. It not only affects those people working in the industry, but also those who provide services to them and whose consumer goods they buy.
The American port at Duluth conducted a study a few years ago which found that for every job directly related to the grain industry, there were 2.57 jobs elsewhere in the community. If we look at last summer's unemployment figures, we are talking about 14,000 people who were directly affected by these
October 15, 1985

lay-offs. The cost to UIC alone, if those people were unfortunately laid off for a year, would be $200 million.
At the present time it costs anywher from $23 to $28 per tonne more to move grain through the Seaway to an export position than it does to move it to Vancouver. We are already in a situation where we cannot compete with our western brethren in the Port of Vancouver. The addition of cost recovery measures would in effect be applied unevenly because Vancouver does not have a requirement for ice-breaking whereas Churchill, Thunder Bay and other ports on the Seaway system do. It makes the gap even worse. This is the kind of thing about which I am concerned, as are my colleagues and the industry. This Bill is pushing up that cost.
I have spoken a fair bit about grain and the Port of Thunder Bay, and as well I have touched on some of the ports downstream of Thunder Bay in terms of their unemployment situation this past summer. I should like to continue on that theme for a little longer. Over the summer, Members tend to spend a lot of time in their ridings talking with people, and this past summer I took the opportunity to spend a lot of my time with the people involved in the grain transportation industry. I met with most of the managers of the grain elevators in Thunder Bay and spoke with the managers of the elevators in the eastern part of the system by telephone. As well, I met with the rail superintendents and with the Grain Transportation Authority staff-all in an effort to understand a little more about the movement of grains. And quite frankly, Mr. Speaker, I found, on going into it, that my knowledge was very limited. I suspect that most Canadians do not have an appreciation of the nature of the grain industry, both in terms of pricing and competition and how grain moves.
I honestly did not know the relationship between the Port of Thunder Bay and the ten bay ports along the Great Lakes and the Ports of Montreal, Trois-Rivieres, Baie-Comeau, Port-Car-tier, Halifax, and St. John's. It was through the research that I did this past summer that I was able to get a much better understanding of the system, and I would like to share some of that with you.
As most Members of the House know, when grain or any other bulk commodity moves from western Canada through the St. Lawrence Seaway, it can be picked up by an oceangoing vessel at Thunder Bay-and that is one of the reasons the Seaway was built some 26 years ago-or it can go on a laker for downstream transference to another elevator or directly on to an ocean-going ship.
About 16 per cent of the grain coming through Thunder Bay goes directly on to a "salty." The remainder is distributed throughout the system through the 32 elevators in 18 communities, stretching from Collingwood to Halifax.
For example, 37 per cent of the grain handled in Thunder Bay is handled in the two ports of Manicouagan, Port-Cartier and Baie-Comeau. The ports of Halifax and St. John's handle 2 per cent each; Quebec City, 15 per cent; Trois-Rivieres, 7
Canada Shipping Act
per cent; Sorel, 7 per cent; Montreal, 12 per cent; and then approximately 18 per cent is handled by the ten bay ports.
I said in committee last year that when the West gets sick, Thunder Bay catches pneumonia. Well, if Thunder Bay catches pneumonia, those germs are spread all the way downstream, because the economies of all of the other port commu-nites go up and down with the economy of Thunder Bay.
I mentioned a few moments ago, Mr. Speaker, the competitive aspect. I should like to give the House an idea of what we are up against in the grain industry in terms of competition. This is part and parcel of what we are dealing with, because the higher the fees, the less competitive we will be as a country.
The Manitoba Government conducted a study from 1972 to 1981 comparing the subsidies for grain prevailing in the European Economic Community, the United States and Canada, the three of which, in combination, handled four-fifths of the world's export grain market during that period, a value of (U.S.) $15 billion.
The report produced as a result of that study contained the following statement:
The question at hand is less one of whether in the absence of subsidies everywhere world grain prices would be lower (they would, and so would government expenditures, and hopefully taxes), but rather what is the likely consequence if one grain-exporting nation reduces subsidies unilaterally. Undoubtedly, its grain production and (very likely) exports would decline.
The study group found that, during that 10-year period, our subsidies averaged about 4 per cent, compared to 8.6 per cent in the United States and 10.5 per cent in the EEC. When they examined the year-to-year levels of proportional subsidies, they found a striking difference between Canada and the U.S. On Canadian wheat, for example, subsidies ranged from a low of 2.2 per cent in 1973 to a high of 5 per cent in 1972. In the United States, on the other hand, the variation was much more pronounced, with wheat subsidies as low as 0.8 per cent in 1974 and as high as 22.5 per cent in 1977.
And this clearly reflects the nature of the U.S. grains support programs. U.S. wheat, on average, received $11.41 per tonne in subsidy; Canadian wheat, $6.35; and the EEC, $19.96.
Mr. Speaker, I have the feeling, given the signal you are making, that I am going to have to share my notes with some of my colleagues so that they can continue the arguments in respect of this issue-


Mr. Gauthier:: With unanimous consent, you could go on.


Iain Francis Angus: The Hon. Member suggests that I could try to get unanimous consent. I am not sure that the House is willing to provide that.


Some Hon. Members:: Sure, sure.


Iain Francis Angus: Let me go on for a bit and we will see what happens.
Mr. Speaker, Clause 4 of the Bill is crucial to the viability of my community in the long term and to port communities all

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along the Seaway. It is crucial to the Port of Churchill and as well to the West Coast ports, particularly the ports of Prince Rupert and Vancouver, and to the maritime ports of Atlantic Canada.
If the user fees are increased to 100 per cent of the cost of the service, Canada would be much less competitive on world markets. Fewer of our products would move offshore.
In the light of that, 1 would ask the Minister to reconsider the whole concept. The Minister indicated to the Elouse last week that he would have no objection to the question of the tolls and fees to be charged by the St. Lawrence Seaway Authority being discussed by the Standing Committee on Transport. What I would like to see happen is for the Minister to remove voluntarily Clause 4 from the Bill and refer it and all other user fees in the marine industry to the Standing Committee on Transport so that the philosophical aspect can be dealt with. In that way we can have hearings focusing on the impact of user fees on marine transportation.
That would allow this Bill to go through in the expedient manner that he has asked for. In that way the positive aspects of the Bill can be put in place, as they most appropriately should be, with the controversial element removed from the Bill, thus giving us an opportunity to examine that issue with the industry, with the users, with the workers. In that way we can take a good hard look at the whole question of the cost of using the Seaway system and the costs of using our ports. It also will allow us to work with the United States in doing these things in concert.
I should like to hear from the Minister whether or not he has received the agreement of the U.S. officials that they will be moving ahead with their cost recovery in respect of the operation of U.S. ports and whether or not this is a matching duo of operations that we have here, or whether Canada is going on its own in this respect.
And if Canada is going on its own, what is the impact within the St. Lawrence Seaway system? Will a lot more of our bulk commodities go to the United States by rail through Minneapolis and Duluth, or to Chicago? There is already potash going by rail from western Canada to Chicago, instead of coming by rail to Thunder Bay and then by water from Thunder Bay to Chicago.
Mr. Speaker, you as a westerner knows, as do all Members of this House, that we cannot hurt our commodity exports. We are involved in a very vicious fight in world markets.
I should like to conclude by asking the Minister once again to pull Clause 4 out of the Bill. I have been advised that I do not have the ability to move an amendment to have Clause 4 removed from the Bill, and so I would ask the Minister to do so in the interest of maintaining a viable shipping industry in this country.
I thank you, Mr. Speaker, and Members of the House for your patience.


The Acting Speaker (Mr. Paproski):: Is the House ready for the question?


Some Hon. Members:: Question.


Mr. George Baker (Gander-Twillingate):: Mr. Speaker,-


The Acting Speaker (Mr. Paproski):: The Hon. Member for Gander-Twillingate (Mr. Baker).


An Hon. Member:: Oh no!


George Baker: Thank you, Mr. Speaker. I had not-


The Acting Speaker (Mr. Paproski):: Order, please. I should just like to remind Hon. Members that we are now in the second phase of Standing Order 36(2), which calls for 20-minute speeches, followed by a 10-minute question and comment period.


George Baker: Thank you, Mr. Speaker. To be quite honest with you, I was not intending to say very much concerning this Bill-


Donald Frank Mazankowski: Prove it.


An Hon. Member:: You now have a full glass of water.


George Baker: Mr. Speaker, I might point out to the House that there are perhaps two things wrong with this Bill. The first is what is in it and the second is what is not in it.
The Hon. Member who just spoke was talking about Clause 4 of the Bill. Perhaps I could elaborate on it a little bit. This clause gives the Governor in Council the authority to make regulations respecting charges relating to services including aids to navigation, dredging, vessel traffic services, ice-breaking services and escorting services. The full implication of that will not become evident until this Government with its massive majority passes this Bill and the Minister of Transport (Mr. Mazankowski), under an obligation to the Treasury Board and the Cabinet, imposes the said charges as outlined in this Bill.
If this Bill passes, we can imagine that the following situation will arise: say that a fishing boat is out in the Atlantic 100 miles off the coast of Canada. Perhaps this boat has engine trouble, is stuck in the ice and needs to call the Coast Guard. The captain of the boat will first have to check to find out how much that will cost him. As well, when boats go out in the spring, ice-breakers normally precede them so that the vessels can be allowed out. That is not the responsibility of the Coast Guard as outlined in its regulations. However, it has always done so over the years because it was of assistance to the fishermen and their communities. All of a sudden, the Coast Guard will have to charge for the time of the ice-breaker. The Minister of Transport knows how much it costs to operate an ice-breaker for just one hour. It is quite a considerable cost. Because of this legislation, the Minister of Transport will be able to impose charges on Canadian fishermen.
Let us not forget that we should never discourage fishermen from checking with the weather office to find out what the weather will be like and we should never discourage them from asking for assistance if they need it. This particular clause of
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the Bill gives the Minister or the Cabinet the authority to impose these charges which have never before been imposed.
Quite frankly, I would warn the Minister of Transport that he should check the Terms of Union between the Province of Newfoundland and the Government of Canada. I can assure the Minister that the Terms of Union indicate that these services will be provided without charge. In fact, through the Terms of Union, it becomes an obligation of the Government of Canada to provide these services free to Newfoundlanders. How can there be an Act of Parliament that gives the Governor in Council the authority to impose these charges? It is absolutely contradictory to the Terms of Union between the Province of Newfoundland and the Government of Canada.
Through this same clause, the Government will now be able to charge for dredging. That is quite something. Who is it going to charge? It is going to charge the provincial Governments, the boat owners or the fish plants and the industries? The dredging of a harbour is done for the use of the public, not only for the use of pleasure craft as pointed out by the Hon. Member a few moments ago. It is done for working people. How is the Government going to charge for this? Obviously it is to be done in the name of cost recovery. Perhaps the Department of Transport and the Department of Public Works which is selling its dredging machines will charge the Department of Fisheries and Oceans, another federal Government Department. Certainly these Departments cannot charge the public of Canada as this clause suggests.
The final point mentioned in this clause is escorting services. Why is the Government of Canada so anxious to charge a boat owner for being escorted into port if he has trouble at sea? A poor fellow with problems with his engine is going to be charged for the time it takes a federal government vessel to bring him into port. That should not be allowed to happen. That is ridiculous. The Minister might say that he will never do that but he wants the legislative authorization to do it. He should not have that legislative authorization.
The second part of Clause 4 is rather interesting. It reads:
Charges may be imposed pursuant to subsection (1) in relation to any ship or vessel, regardless of whether the Canadian Coast Guard actually provides a navigational service to that particular ship or vessel.
That is an interesting clause. Can you imagine charging someone for something you did not do, Mr. Speaker? Perhaps that part of the clause exists so that a boat owner may be charged if his engine starts while the Coast Guard vessel is on its way to get him.
Clause 4 goes on to indicate that interest may be charged on the amount outstanding from time to time. I would say that this clause is directed particularly at fishermen from eastern Canada. The Government can eventually bring fishermen to court on interest charges owed for help given in 1980. The clause also gives to the court authorization to collect the fee owing plus any charges owing. That is an incredible affront to the fishermen of eastern Canada.
At the same time as the Government with its massive majority, through the Department of National Revenue, is trying to make deals with every fisherman from Newfoundland
Canada Shipping Act
for the repayment of some $14 million, the federal improvement loans that were guaranteed by the Government of Canada through the banks will no longer be honoured by the Government. On top of that, there is now to be a system of charging fishermen for other things. This will affect fishermen from British Columbia to Newfoundland.
Fishermen are now receiving notices from the Department of Fisheries and Oceans saying that loans made back in the late 1970s and early 1980s will no longer be guaranteed for a three-year period. On top of that comes this legislation.
Another very interesting part of Clause 4 indicates the following:
The Minister may enter into an agreement with the government of any province or any agency thereof for the collection of charges,-
Why would the federal Government enter into such an agreement with a provincial Government? The only reason I can see is that many of the services provided relate to provincial transportation systems like ferry systems. Although it is not normally its function, the Coast Guard provides ice-breaking services in British Columbia, Quebec and Newfoundland. There can now be a charge for that service. This clause enables the federal Government to enter into an agreement with the provincial Governments for the collection of those fees. Actually, the charges will be paid by the general public which travels to many islands off the Canadian coast.
As far as Clause 4 is concerned, it would contravene the Terms of Union between the Newfoundland Government and the federal Government if it can be enacted on the approval of the Newfoundland Government. It would not surprise me, from the way this Government gets along with the Newfoundland Government, to see that approval granted. Everything this Government does is approved by the Newfoundland Government. There are no disagreements. Everything is hunky-dory. The two Government are like peas in a pod. No matter what this Government does, it is agreed to by the Newfoundland Government. Perhaps it will get the agreement of the Newfouland Government to enact this, although I believe it is against the Terms of Union between the Province of Newfoun-land and the federal Government. That is what is in the Bill, Mr. Speaker, as far as absolute error of judgment on the part of the Minister of Transport is concerned who is being forced to do this by the Treasury Board.
What is not in the Bill, Mr. Speaker? Bill C-75 reads:
An Act to amend the Canadian Shipping Act and to amend the Arctic Water Pollution Prevention Act, the Maritime Code Act and the Oil and Gas Production and Conservation Act in consequence thereof.
I will tell you what is not in the Bill, Mr. Speaker. The Minister of Transport in introducing this Bill talked about the amendments which were being made as far as the safety of seafarers, workers and ships is concerned. The biggest disaster in Canadian shipping history in the past 10 years was the sinking of the Ocean Ranger. There was a royal commission which presented its reports to the federal Government and the Government said it was going to implement this and that

October 15, 1985
Canada Shipping Act
recommendation. It announced it was going to increase search and rescue in St. John's, Newfoundland. But all it did, Mr. Speaker, was to steal a helicopter from my riding. The Government stole a helicopter from Gander Search and Rescue and put it in St. John's to take care of the offshore. Then it found a fixed wing aircraft somewhere, either in Nova Scotia or in New Brunswick, and stuck that down there, and that was the Government's improvement in search and rescue service.
The Government said it made certain structural changes. It claimed it got together with the Newfoundland regulatory authority to achieve some sort of unity in its regulations. You see, Mr. Speaker, there were Newfoundland Government regulations, federal Government regulations under the Canada Shipping Act, the Canada Oil and Gas Lands Act and the Newfoundland Oil Directorate regulations. Then there were the U.S. shipping regulations. All of them came together in the case of the sinking of the Ocean Ranger and in the subsequent examination. An incredible number of recommendations were made by the royal commission.
This Bill talks about the Canada Shipping Act and the Oil and Gas Production Conservation Act. I would venture to say, Mr. Speaker, that the key recommendations made by the royal commission are not being followed in this particular Bill. The Minister said in his opening remarks that he was going to bring in further amendments later on next fall. But that is not good enough. Even when those changes are brought in, I just wonder whether or not the Government of Canada will actually do anything to prevent a similar disaster from occurring again.
When we read the Ocean Ranger report, we are struck by one fundamental fact. In examining the entire sequence of events, it boils down to the fact that there were people in the water who could not be rescued. That is incredible, Mr. Speaker. Most people who heard about the Ocean Ranger disaster actually believed that everyone was drowned in the rig and that the rescue vessels went out to look for them and could not find anyone. That is not correct. There were people who actually were in boats, in the water, and they could not be rescued. It is rather shocking to read that section of the report which talked about 20 or 30 men in a life boat, going towards this stand-by rescue ship, in waves up to 80 feet high, the men all shouting, and the rescue boat actually throwing a line to the vessel and trying it on to the rescue boat. There were 20 or 30 people alive in the boat and not one of them ever came ashore. Not one of them ever got into the rescue ship. We have to ask ourselves, Mr. Speaker, what was wrong.
When we look at the report we discover that what was wrong was that there were no regulations-and there still are none-under the Canada Shipping Act because it has no jurisdiction. It should have jurisdiction and it should be spelled out in this Bill but there is no regulation concerning the type of vessel which is used as a stand-by vessel for certain rescue purposes. The people could not get over the side of the rescue vessel because of the way the vessel was built. Those people could not get over the side because there was no mechanism to take them over the side, even if the boat had been built
differently. We have this incredible disaster of 20 or 30 men in a boat, trying to get aboard a rescue ship and not being able to do so because there were no facilities on board, according to Canadian law or any other law, to make these rescue ships capable of saving the people who were in the ocean.
According to the reports there were men floating around with life jackets on in the middle of the night, with lights on, and they could not be saved. The Search and Rescue helicopters came out and they could not save them. That is the bottom line, Mr. Speaker. And the Government of Canada after receiving that report should have sat down with the Canada Shipping Act, with all of the regulatory bodies, and asked itself how it could prevent this from happening again. The federal Government should have sat down with the Newfoundland Government-


Mr. Forrestall:: Three are 12 amendments, for God's sake.


George Baker: The Hon. gentleman should read these reports and find out how many amendments were recommended. The Minister said he was going to bring in legislation with respect to extending the jurisdiction out to that area. As I was saying before I was so rudely interrupted, the federal Government should have sat down with the Government of Newfoundland. I am sure the Parliamentary Secretary will agree with what I am about to say. The regulations of the Newfoundland Government stated that there had to be x number of Newfoundlanders hired right off the bat in every branch of that operation offshore. And even before the disaster took place, there should have been some co-ordination as to where these people should be, who they should be and how we define the occupations. But paramount in the minds of both Governments should have been the question, what were the recommendations of the royal commission on the Ocean Ranger marine disaster as it relates to the Canada Shipping Act and to the other Acts with which we are dealing today.
The Minister brings a Bill into this House today amending the Canada Shipping Act but does not adopt the most important recommendation of the royal commission, which was to give some jurisdiction to that area. The Minister tells us he is going to bring it in next fall and I suppose it is better late than never but I wonder what the extent of his amendment will be. The Minister says he is now going to charge everyone for using rescue ships. Shame! He is going to charge people for using an ice breaker or rescue ship to meet a long liner. That is absolutely incredible.
You are about to cut me off, Mr. Speaker.


The Acting Speaker (Mr. Paproski):: The Hon. Member's time has expired. He will still have 10 minutes for questions or comments after three o'clock.
It being one o'clock, I do now leave the Chair until two o'clock this day.
At 1 p.m., the House took recess.
October 15, 1985


COMMONS DEBATES AFTER LUNCH
[Stage Direction]
The House resumed at 2 p.m.


Mr. George Henderson (Egmont):: Mr. Speaker, the Prince Edward Island Truckers Associations is hopping mad. As of today, October 15, Northumberland Ferries Limited is tying up the M.V. Confederation for the winter. Reducing the number of runs between Wood Islands and Caribou, Nova Scotia, means a weaker link in our connection to the mainland. Businesses which transport goods on and off the Island do not need this. They are already at a competitive disadvantage with the Atlantic counterparts because of the ferries. Line-ups and long delays are not uncommon for Islanders who depend upon the ferries. Reducing the number of ferries just adds to those problems.
We need a consistent, reliable ferry service on Prince Edward Island. We do not need fewer crossings at a time when potato farmers are busy shipping their crop to markets in Newfoundland and Nova Scotia. Farmers do not have extra winter storage space. They count on getting their early crop to market in October and November.
This move does not help our farmers who are once again facing a bleak year. Potato prices have hit rock botton. P.E.I. farmers are getting 1.5 cents per pound, which is 4.5 cents per pound below the cost of production. They also depend on the ferries to bring in lime from Nova Scotia. The P.E.I. Government brings in salt from Nova Scotia for our highways. These are just a few examples of those who will be seriously inconvenienced by one less ferry on that run.
Northumberland Ferries Limited would operate the M. V. Confederation with two crews until late November if the Government would approve this necessary sailing and provide the funding.


Mr. Speaker:: I regret to advise the Hon. Member that his time has expired.



CALIFORNIA GRAPES-BOYCOTT CAMPAIGN

Mr. Rod Murphy (Churchill):: Mr. Speaker, Cesar Chavez, Leader of the United Farmworkers of America, met with Members of Parliament today as part of his nation-wide tour, gathering support for a renewed boycott of California table grapes. At this meeting Members of Parliament from all three
political Parties officially signed a pledge to join and support the boycott. I hope all Members of this House will take the lead in encouraging Canadians to support this cause.
We are asking Americans to enforce the law enacted in 1975 to allow farmworkers the right to unionize. Grape workers continue to be fired, coerced and abused by the corporate grape growers, and there have even been two union leaders killed. The boycott is also aimed at forcing grape growers to drop the use of pesticides which are dangerous to the workers, their families, and consumers.
To quote Cesar Chavez: "Farmworkers will never again be treated like agricultural implements to be used and discarded. We have tasted freedom and dignity, and we will fight to the end before we give it up. We have come too far and we have too much further to go to give up now!"



PROVINCIAL AFFAIRS


Mr. Gordon Taylor (Bow River):: Mr. Speaker, it was a great weekend in Alberta. Thousands gathered in Edmonton to thank Premier Peter Lougheed and his wife Jeanne for years of dedicated service to Alberta and Canada. His record stands out conspicuously throughout our Dominion. His administration improved health services for all of the people, with emphasis on those for the mentally retarded. His program gave eastern Canadians oil and gas at prices which cost Alberta millions of dollars. He was a great Albertan and a great Canadian, and this House now wishes him and his wife many more years of happiness.
His replacement, Don Getty, who was raised in Montreal, educated in Ontario, went west with Margaret, his wife, in 1950 and chose Alberta as his home, was chosen as Alberta's next Premier. Flanked by his two opponents, either one of whom would have been an excellent Premier, Don Getty declared: "I'm happy to have you on my team". Thousands cheered. "We're going to listen to the grassroots", he continued. He will give agriculture and jobs top priority. "I will not soon forget the National Energy Program that crushed our growth and derailed our economy", he cried to the thunderous applause of the people.
A strong Alberta means a strong Canada, and Don Getty, a real man with high principles, will make sure Alberta's voice is heard and respected. He will add strength and teamwork to the national P.C. determination to build a strong and united nation. Long live Premier-elect Don Getty?


Some Hon. Members:: Hear, hear!
7632_________________________________



THE COMMONWEALTH


Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, I am pleased to inform the House that the 31st Conference of the Commonwealth Parliamentary Association held recently was a complete and resounding success. Held from October 2 to October 11 in Regina and Saskatoon, it attracted 250 delegates from 46 countries around the world. In representing some 10,000 parliamentarians and one billion people, the delegates worked to bring each country closer together toward the common good of mankind.
Amid the fabulous panorama that is Saskatchewan, many of the world's ills were discussed by this group of international legislators. Apartheid, drug abuse, electoral law practices, the debt crisis, and international currency fluctuations were but a few of the important problems under scrutiny at the Conference.
The image of modern-day parliamentarians was also investigated, and it was concluded that the M.P. must be more mindful of his or her commitment to constituents, rather than seeking to enhance his or her own image. We are the watchdog for the people, and although we are obliged to have some Party interests, they should not be at the expense of the people we represent. Those responsible for setting the agenda for this Conference are to be warmly congratulated. In this time of fractious relations between some countries, conferences such as this are the cement of international relations.



LABOUR CONDITIONS


Mr. Dave Dingwall (Cape Breton-East Richmond):: Mr. Speaker, I rise today under the provisions of Standing Order 22 to express my concern in the hope that the Government will take some action regarding the high unemployment rate on the Island of Cape Breton. On Friday Statistics Canada reported that this area had the highest unemployment in all of Canada.
One of the actions taken by the Government since it came to power was to close down two heavy water plants in Cape Breton, thereby throwing 750 people out of work. The Government has refused to provide much needed money for the Sysco modernization fund, previously agreed to by the provincial Conservative Government and the federal Liberal Government. The Government has terminated the decentralization program which would have provided a couple of hundred jobs in the City of Sydney. It has also made major cut-backs to the CBC budget, thereby nullifying its efforts in that area of Canada. It has also terminated the expansion of the coal industry on the Island.
All this Government has done is appoint an advisory committee, which has made 34 recommendations to the Minister of Regional Industrial Expansion (Mr. Stevens), which would
October 15, 1985
pump in excess of $600 million into the economy of the Island for the fiscal year 1985-86. I hope that the Minister responsible, as well as the Minister of Employment and Immigration (Miss MacDonald), will take their responsibilities quite seriously and move on these recommendations forthwith. There is high unemployment in the construction and fishing industries, and-


Mr. Speaker:: I have to advise the Hon. Member his time has expired.



HOUSING


Daniel James Macdonnell Heap: Mr. Speaker, as more and more Canadians fall below the poverty line, the Tory Government is moving to reduce its commitment to ensuring that all Canadians have equal access to decent, affordable housing. For a year now, the Minister of Labour (Mr. McKnight) responsible for housing, has carried on closed-door negotiations with selected groups concerning changes to the federal housing program.
Provincial Governments and others have leaked information showing that the consistent direction of the Minister's negotiations is toward handing over to the provinces much of the responsibility for social housing traditionally belonging to the federal Government. However, groups representing users of social housing, such as co-ops, tenants, and unions, along with Members of Parliament, have been excluded from these discussions with the Minister for many months. Recently in a letter to the Minister the Canadian Labour Congress demanded that he stop these secret and one-sided negotiations until he has put on the table some clear proposals and invited everyone in the public to comment.
Does the Minister intend to opt out of all social housing programs? If not, which ones? Will he maintain and enforce standards of housing supply in all provinces and territories? Will he reaffirm the federal Government's commitment to funding assistance to all parts of Canada for rent geared to income housing, co-op and non-profit housing, native peoples' housing, and home owners' mortgages?


Mr. Speaker:: I regret to advise the Hon. Member that his time has expired.



BANKS AND BANKING


Mr. Gabriel Fontaine (Levis):: Fortunately, Mr. Speaker, the collapse of the Canadian Commercial Bank and the Northland Bank did not set off the chain reaction Opposition Members were predicting.

October 15, 1985

However, Mr. Speaker, we should consider those two unfortunate events as an opportunity to take stock of the situation and introduce mechanisms that will preclude further occurrence of this kind in Canada's economy.
About sixty new banks have been established in recent years. Relevant legislation was never passed and was not in place to anticipate the results we have seen in recent weeks.
On the basis of those events, our Government has ample justification for adopting new provisions to strengthen the supervision of our banking institutions.
Mr. Speaker, we must conclude that the efforts of the Minister of Finance (Mr. Wilson) and the Minister of State for Finance (Mrs. McDougall) as well as the solidarity shown by our major banks last week were successful in stemming the incipient psychological panic that might have harmed two more banks for purely artificial reasons.
Congratulations to the Minister of Finance, the Minister of State for Finance and our major banks!
Depositors can stop worrying and our banks will continue to be safe and secure for both Canadians and non-Canadians.



SUPPORT FOR CANADA-UNITED STATES NEGOTIATIONS

Mr. Bill Attewell (Don Valley East):: Mr. Speaker, on September 26 the Prime Minister made a historic announcement to express Canada's interest in pursuing a new trade agreement with the United States. Trade has been critical to the livelihood of Canada. One-third of what we produce is exported, yet our share of world trade is declining, and this means a loss of jobs.
We want to turn this trend around, Mr. Speaker. My Government's highest priority is job creation through economic renewal. I applaud the Government for this courageous initiative which is not without risks. The Macdonald Commission on the economy said: "Instead of weaknesses, we found substantial areas of strength in Canadian manufacturing. Canada has proved its industrial capacity at the level of the individual firm and the subsector, even in sectors that normally run a deficit in U.S. trade. Thus Canada would be likely to achieve substantial benefits from more open trade, even in our manufacturing sectors".
The Canadian Manufacturers' Association recently stated that more than 475,000 new manufacturing jobs have been created in Canada over the past 20 years and that all but a handful can be attributed to our expanding export trade. It is clear that we must negotiate with the U.S. to find special and direct means of securing and enhancing the $155 billion of trade which we enjoy with the United States.



YOUNG OFFENDERS ACT


Hon. Bob Kaplan (York Centre):: Mr. Speaker, I would like to say a few words about the Young Offenders Act. This piece of legislation came into effect during the last Parliament, part of it in 1982 and another part about a year ago. 1 consider it, as I believe most Canadians do, to be a great reform and it had the unanimous support of this Parliament when it was passed. However, I certainly would not want to give the impression that I think the legislation is perfect. 1 know that there have been some criticisms of it, but a lot of them are not well founded. They are really as a result of problems created by provincial Governments failing to implement the parts of the legislation which are under their jurisdiction. However, if some of the interpretations of the courts which have heard certain cases are right, they indeed suggest that the law should be amended.
The Government has had two Solicitors General now, both of whom have indicated that they are studying the law and consulting with the provinces about it. I think it is time for that process to be completed in order that full public confidence in that legislation can be established. I think that the present Solicitor General (Mr. Beatty) should let the House and the Canadian people know what shortcomings he sees in the legislation. If there are any, he should introduce amendments to correct that legislation.



ENVIRONMENTAL AFFAIRS


Mr. John Oostrom (Willowdale):: Mr. Speaker, acid rain and other air contaminants have been killing some forests in the eastern United States as suddenly and drastically as they have wreaked havoc on the famous Black Forest in Germany, according to American scientists. Dr. Hans Marten, senior adviser to the Canadian Acid Rain Research Program, said such findings in the United States are very worrisome for Canada.
Though the effects on our forest, have been minimal when compared to the deterioration of the forests in the Adiron-dacks, our stands of maple are showing symptoms of decline. Over the past several years there has been a serious decline in the production of maple syrup. Research indicates that there is a direct correlation between the increase in acid rain and the decrease in maple syrup production.
The maple syrup sugar industry is a component of our economy upon which hundreds of jobs depend in areas where it is produced. Maple syrup is part of our culture and our history. It marks the coming of spring. The Government must do everything possible to solve the acid rain problem or we will lose not only our forests and lakes, but also part of our heritage.

October 15, 1985
Oral Questions



ORAL QUESTION PERIOD


[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, I was going to address my question to the Minister of Employment and Immigration, but I will address it to the Minister of Finance. The unemployment statistics released on Friday clearly indicate that there has been a decline, by 24,000, in full-time jobs, and an increase, by 47,000 in part-time jobs which, by the way, has been an ongoing trend for several months. Will the Minister explain to the House why his Government is so willing to accept this exchange of low paying part-time jobs for full-time jobs? Is that what his leader meant when he was promising "jobs, jobs, jobs" during the election campaign?
Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, at the time of the election we promised 300,000 "jobs, jobs, jobs". That is pretty good for a full year.


Some Hon. Members:: Hear, hear!


Michael Holcombe Wilson: We would have been happier if they had been full-time jobs, but 1 ask the Member to cast his mind back. About three months ago there was a sharp increase in full-time jobs and a drop in part-time jobs. I do not recall the Member asking a question at that time.


EMPLOYMENT OF WOMEN
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, my supplementary question is directed to the Minister of Employment and Immigration. The trend has been toward a greater percentage of part-time jobs. Those statistics released on Friday indicated that the 24,000 full-time jobs which were lost were almost entirely those of women. Of the 47,000 new part-time jobs, 45,000 were taken up by women. Why is the Minister and her Government satisfied with having women move from full-time jobs to low-paying part-time jobs? Is that what she promises to the women of this country?
Hon. Flora MacDonald (Minister of Employment and Immigration):: Mr. Speaker, the continuing trend has been toward a decrease in unemployment for the last six months.


Mr. Allmand:: Part-time jobs.


Flora Isabel MacDonald: That has been an ongoing decrease.


Some Hon. Members:: Hear, hear!


Flora Isabel MacDonald: With regard to part-time employees, Mr. Speaker, we have found, through analysing this situation and questioning people about it, that those who are seeking parttime work are doing so in large measure because they also want to return to school and to training.


Ms. Mitchell:: Come on.


Flora Isabel MacDonald: For that very reason, Mr. Speaker, we introduced,-


Margaret Anne Mitchell: You know better than that.


Flora Isabel MacDonald: -for the first time, training allowances for people who are working part-time. That applies particularly to women who will benefit under this new program.


WALLACE REPORT INQUIRY
William Warren Allmand: Mr. Speaker, the Minister has now confirmed that she is willing to live with this very bad trend away from full-time work to part-time work. If she is willing to accept that, when is she going to announce the implementation of the recommendations of the Wallace Report on part-time work which would guarantee pensions and other important fringe benefits for part-time workers?


Flora Isabel MacDonald: Mr. Speaker, as I mentioned, we have implemented training allowances for those who are working parttime and who are attending school or training programs part time. That became beneficial for 21,000 people in the last month and for some 170,000 over the last year. Those people are able to improve their situation because they are now able to enroll in part-time training and to benefit themselves by becoming more productive as a result of that training and the training allowances they now receive.


EMPLOYMENT
Mr. Jacques Guilbault (Saint-Jacques):: Mr. Speaker, my question is directed to the Minister of Employment and Immigration.
Regarding unemployment, our major concern in Quebec is that Montreal's industrial base is being eroded to the point of no return, and that the Government is doing very little to stop the process.
The Minister of State (Transport) has refused to make a commitment to provide locomotive contracts for Bombardier. The Minister of Energy, Mines and Resources has refused to guarantee funding for Motoco to purchase Gulf, which would protect jobs. 1 therefore wish to ask the Minister whether she is relying on her part-time employment policy to replace the thousands of full-time jobs now being lost in the east end of Montreal.
October 15, 1985


Flora Isabel MacDonald: Mr. Speaker, I am very happy to say that the number of jobs created in Montreal last year was over 50,000.


IMPORTANCE OF CREATING FULL-TIME JOBS
Jacques Guilbault: I have a supplementary, Mr. Speaker.
The Minister fails to realize that part-time jobs are being created while every day, full-time jobs are being lost. I would like to ask the Minister to come down from her ivory tower and explain to the House whether she has a specific plan to stop the erosion of Montreal East's industrial base. If she does, could she provide details of that plan now and right away?


Flora Isabel MacDonald: Mr. Speaker, I am pleased to say I often have a chance to visit Montreal, and from time to time I spend a few weekends in Montreal to discuss the problems of the unemployed with certain people in that city, and I intend to continue to do so.


APARTHEID
Ms. Pauline Jewett (New Westminster-Coquitlam):: Mr. Speaker, my question is directed to the Secretary of State for External Affairs. How can Canada take a strong position on economic sanctions against South Africa at the Commonwealth Conference this week and persuade the United Kingdom to take a strong position when its own policy is so weak, when it supports only voluntary sanctions that business appears to be ignoring entirely and that require no economic sacrifice on our part?
Right Hon. Joe Clark (Secretary of State for External
Affairs): Mr. Speaker, not only do I not agree with the Hon. Members, characterization of the policy of the Government of Canada on South Africa, she did not agree with it when I announced that policy some two or three weeks ago.


GOVERNMENT POSITION
Pauline Jewett: Mr. Speaker, I encouraged the Minister in his policy statement several weeks ago and urged him to see that the private sector went along with the intentions of the Government of Canada. The private sector, as the Minister knows, is totally ignoring the policy of the Government of Canada. An instance in British Columbia came to light the other day.
Will he restore the credibility of his position on sanctions against South Africa by admitting that the voluntary process
Oral Questions
is not working and we will turn to mandatory economic sanctions?


Right Hon. Joe Clark (Secretary of State for External Affairs):: Mr. Speaker, it may be that some Members of the House are so committed, as a matter of principle, to state action as against voluntary action that they will not give the voluntary process a chance to work. The evidence is that there has been remarkable voluntary support by the business community, by the labour community and other Canadians for the position that has been taken by the Government of Canada with respect to South Africa.
The Hon. Member makes general reference to a particular case in British Columbia. I presume that is the one she raised with me in the House the other day. By now she should have received a letter from me indicating the full details and background of that case which indicate that, in effect, there is no inconsistency with the policy of the Government of Canada. There is no danger of the export of Canadian computers to a sensitive industry in South Africa. That will not occur.


Pauline Jewett: Yes, I was referring to that exact MacDonald Dettwiler case. However, I did not want to take the time to go into it here.


IMPLEMENTATION OF POLICY
Pauline Jewett: The
fact is that the Government did not object to what MacDonald Dettwiler was doing. It did not ask it to postpone or call off the trip from the branch of Armscor in South Africa trying to do business with a Canadian firm. In fact the Minister did not object.
I ask the Minister to stop kidding us about objecting. He does not object. Will he now object to Canadian business doing business with South Africa? Will he admit that it should not be doing business with South Africa? Will he encourage sanctions at the Commonwealth Conference?


Charles Joseph Clark: Mr. Speaker, for a case that the Hon. Member did not want to raise in the House of Commons, she is pursuing it with considerable vigour and considerable inaccuracy. She knows the facts. I gave her the facts in a letter. She must have them in her hands.


Pauline Jewett: I do indeed.


Charles Joseph Clark: She knows that the policy announced by the Government of Canada would stop the export of that kind of computer to South Africa.


Pauline Jewett: There is no policy at all.


Charles Joseph Clark: That was not the case before our policy was introduced. That is the case now.

October 15, 1985
Oral Questions


BANKS AND BANKING
Mr. Raymond Garneau (Laval-des-Rapides):: Mr. Speaker, since the Minister of Finance is in the House, I would like to ask him a question about the Mercantile Bank. It is common knowledge that the Government's incompetence in its abortive attempt to rescue the Canadian Commercial Bank has led to liquidity problems at the Mercantile Bank, for one, and considering what we are reading in the newspapers, I would like to ask the Minister of Finance, who said before leaving on a trip that he was completely in control of the situation, what is actually happening at the Mercantile Bank.


Michael Holcombe Wilson: Mr. Speaker, if the Hon. Member has a specific question I would be happy to respond. However, the Hon. Member can read the newspapers. He knows that statements have been made by the Mercantile Bank. It is making these statements as a private sector institution, and I will let those statements stand on their own.


FUTURE OF MERCANTILE BANK
Raymond Garneau: Mr. Speaker, I have a supplementary. As I understand it, the future of Canada's banking system no longer concerns the Minister and it is up to the financial institutions to make decisions that will affect thousands of depositors. What is the real situation today at the Mercantile Bank? For instance, does the Minister of Finance agree with the suggested amalgmation with Citibank and its Canadian branch, to make it a Schedule B bank?


Michael Holcombe Wilson: Mr. Speaker, now that the Hon. Member has put a specific question, I will give him an answer. He is speculating on the result of some actions that might be forthcoming from the decisions being taken by the Mercantile Bank. That is speculation at this point in time and I caution him not to jump to conclusions based on speculation arising out of street talk.


POSSIBLE TAKEOVER
Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, my question is also directed to the Minister of Finance. He will be well aware that a United States merger firm has been commissioned to find a buyer for the Mercantile Bank. Is he prepared to suspend the provisons of the Bank Act to allow a foreign bank to take over this small Canadian regional bank?


Michael Holcombe Wilson: Mr. Speaker, I would give the Hon. Member the same response. He is reading
the papers and drawing some conclusions out of speculation that is arising from rumours. 1 ask and caution him not to draw any conclusions arising out of that speculation.


BANK ACT PROVISIONS
Nelson Andrew Riis: Mr. Speaker, I am asking the Minister for the policy of the Government. We have been told time and again that the Bank Act cannot be changed in order to provide us with a list of depositors. However, we now discover that to enable a foreign bank like Citibank to take over Mercantile, it would require ignoring the provisions of the Bank Act. Is the Minister of Finance prepared to ignore the provisions of the Bank Act to allow this acquisition to take place?


Michael Holcombe Wilson: First, Mr. Speaker, what acquisition are we talking about? As 1 said in my previous answer, the Hon. Member is responding to speculation that is coming out of rumours on the street. The Hon. Member should know that there are many rumours floating around these days and some of them are totally untrue.


CANADIAN COMMERCIAL BANK-MINISTER'S LETTER TO SHAREHOLDER
Miss Aideen Nicholson (Trinity):: Mr. Speaker, my question is directed to the Minister of State for Finance. On August 9, having received the interim Hitchman Report, the Minister wrote to a shareholder of the Canadian Commercial Bank, saying: "The liquidity requirements of the CCB are being met by the Bank of Canada. Such liquidity will be continued . .. until full confidence in the bank is restored". Will the Minister tell the House why the Government flip-flopped and closed the bank two weeks later?


Hon. Barbara McDougall (Minister of State (Finance)):: Mr. Speaker, there was no flip-flop.


Some Hon. Members:: Oh, oh!


Barbara Jean McDougall: I have told the Hon. Member before that all facts will be coming forward in a judicial inquiry and that other facts will be coming forward in committee on the Bill which is now before the House. When those facts become available, I suggest the Hon. Member will be quite pleased.


MINISTER'S ASSURANCES
Aideen Nicholson: Mr. Speaker, my supplementary question is directed to the Minister of Finance. The assurances of the Minister of State for Finance on August 9 were unequivocal. Shareholders and depositors alike hung in because of them. Why, then, did the Government not live up to these assurances?
October 15, 1985


Michael Holcombe Wilson: Mr. Speaker, I think my colleague, the Minister of State for Finance, has responded quite adequately to that question. At that time she said that the liquidity of that bank would be maintained. It was maintained until we took the decision on Labour Day weekend that the bank was no longer viable. I am sure the Hon. Member would agree with me and say that we should not maintain in existence a bank which is no longer viable.


ST. LAWRENCE SEAWAY WELLAND CANAL BLOCKAGE
Iain Francis Angus: Mr. Speaker, my question is directed to the Minister of Transport. It concerns the unfortunate accident on the Welland Canal. How long is it estimated that the canal and the system will be shut down? More important, given that the President of the Seaway Authority indicated that the Seaway is beginning to show its age, what steps will the Minister and the Government take to ensure that the canal, as well as other structures along the Seaway, will remain structurally sound and therefore safe?


Donald Frank Mazankowski: Mr. Speaker, unfortunately I am not in the position as of now to give the Hon. Member the kind of information he wants. The extent of the damage is still being assessed. I will be meeting with the president of the Seaway this afternoon. There are four engineers and contractors on site. I expect to have a preliminary report this afternoon. As well, the president of the Seaway Authority will be meeting with the users tomorrow to discuss further actions. Perhaps by that time we will have a better idea of the extent of the damage and the length of time which will be required to repair Lock No. 7.


CONDITION OF LOCKS
Iain Francis Angus: Mr. Speaker, setting the accident aside, is the Minister prepared to commit the necessary capital funds to ensure that all locks remain in a usable condition for the next 20 years?


Donald Frank Mazankowski: Mr. Speaker, I would certainly like to give the Hon. Member that assurance, but 1 am sure he would understand that it would be premature for me to undertake what he is suggesting. I urge him to wait for an accurate assessment of the damage. I will be glad to confer with him upon ascertainment of those facts.


INCOME TAX
Mr. Lee Clark (Brandon-Souris):: Mr. Speaker, my question is directed to the Minister of National Revenue. As the
Oral Questions
Minister knows, western Canadian grain producers often receive cash advances in the fall and grain is subsequently delivered in the next taxation year to cover the cash advances. As there is some confusion on this point among Canadian farmers, could the Minister clarify which is taxable? Is it the cash advance that is taxable, or is it the grain which is delivered the next taxation year?


Hon. Elmer M. McKay (Minister of National Revenue):: Mr. Speaker, for the benefit of my colleague and the House, the Department's position is that for taxation year 1985 and subsequent taxation years, farmers are only required to report proceeds from the sale of crops in the year in which the sales actually take place. The 1985 Farmers' Guide, which will be available in December, will clearly set this out to remove any uncertainty that presently exists.


AGRICULTURE
Mr. Maurice Foster (Algoma):: Mr. Speaker, my question is directed to the Minister of Agriculture. It concerns the desperate state of the Canadian sugar-beet industry and a stabilization payment for the 1983 crop year. For the first time in 60 years there is no crop due to market conditions. The Minister indicated in a letter a couple of weeks ago that there would be no stabilization payment for 1983, yet the Government House Leader in the Senate indicated last week that the matter would go before Cabinet for a decision. Could he indicate which decision will prevail, which one is factual, and which one is retractable?


Hon. John Wise (Minister of Agriculture):: Mr. Speaker, the Hon. Member will know that the Government is very concerned about the future of the sugar-beet industry, particularly in view of the fact that we have growers left in only three provinces. The Hon. Member should know that we took immediate action to provide some financial incentive to the producers of the three provinces. It was not picked up by the Province of Alberta. However, as he knows as well. Cabinet is giving very active consideration to further assistance for the industry. At this point in time I am not in a position to indicate to him exactly what the final decision will be.


GOVERNMENT POSITION
Maurice Brydon Foster: Mr. Speaker, could the Minister explain why he has cancelled five meetings since the First of the year with sugar-beet producer groups? Could he clarify exactly whether or not a 1983 crop year stabilization payment will be made? The Minister has indicated that it will not be made, and the Government House Leader in the Senate has indicated that this matter is up for consideration by Cabinet. Can he indicate whether or not a stabilization payment will be made for the 1983 crop year?

October 15, 1985
Oral Questions


John Wise: Mr. Speaker, I do not know whether there was some misunderstanding or misinterpretation of my remarks. I cannot recall at any time ever giving an indication that a 1983 payment would not be made.


Maurice Brydon Foster: I have it in a letter.


John Wise: At the moment it is being considered in the over-all package which would provide some benefit to ensure the retention of the sugar-beet industry.


CANADIAN DEVELOPMENT INVESTMENT CORPORATION
Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, my question is directed to the Minister of Regional Industrial Expansion. Three of the seven members of the CDIC divestiture committee are tied to the Brascan group, the company which is trying to buy 15 per cent of the Canada Development Corporation. Will the Minister request that these three members resign in view of the conflict of interest their Branscan ties create for a body which is shaping how the CDC is to be privatized?


Hon. Sinclair Stevens (Minister of Regional Industrial Expansion):: Mr. Speaker, in answer to the Hon. Member for Essex-Windsor, rather than ask for resignations, I ask him to identify for the House where exactly the alleged conflict of interest exists. If he cannot identify that conflict of interest, he should resign himself.


Some Hon. Members:: Hear, hear!


MANAGEMENT DEBATE
Steven W. Langdon: Mr. Speaker, I simply hope the Minister will do likewise if I demonstrate this conflict of interest.


Some Hon. Members:: Hear, hear!


Steven W. Langdon: We have a conflict publicly between CDC and CDIC about the independence of CDC management. Why can the Minister not see that allowing CDIC to debate in public with CDC is very much a conflict of interest, when three of the members of the CDIC divestiture committee are key players in the Brascan group which is trying to take over CDC?


Sinclair McKnight Stevens: Mr. Speaker, again in answer to the Hon. Member, one wonders should we have entrusted to such Members our legislative committee procedure? The fact is that witnesses appeared before the committee and discussed exactly what the Hon. Member is raising in the House. Rather than be
responsive to such an open approach, the Hon. member suggests that the mere fact they entered into the discussion to which he alluded indicates a conflict of interest. What absolutely tommy-rot!


EXTERNAL AFFAIRS
Hon. Jean Chretien (Saint-Maurice):: Mr. Speaker, I should like to ask a question of the Secretary of State for External Affairs. Will the Secretary of State for External Affairs inform this House who authorized the Minister of National Revenue to represent the Canadian Government at the National Day celebration of Taiwan?


Charles Joseph Clark: Mr. Speaker, the question of authorization for a Minister to attend a domestic event in Canada is really not at issue.


An Hon. Member:: A multicultural event.


Charles Joseph Clark: The precaution taken by the Minister of National Revenue was to check with the appropriate Department of Government, the Ministry of State for Mul-ticulturalism, which assured him that the group sponsoring the meeting was a group which represented a broad cross-section of Canadians of different origin.


REPUBLIC OF CHINA-CANADIAN POSITION
Joseph Jacques Jean Chrétien: Mr. Speaker, could the Minister explain to the House why there was no one in this Government who could inform the Minister in question that it was the National Day of Formosa, and furthermore, does the Minister intend to send apologies to the Government of the People's Republic of China?


Charles Joseph Clark: Mr. Speaker, there is no need for sending apologies to the Government of the People's Republic of China or any other government. In fact, direct contract was made by the representative of the Government of China with the Canadian Government. There were no representations from the Government of the People's Republic of China. It is a matter of position. It is not a matter that concerns relations between Canada and China. If the Liberal Member still wants to stir up a controversy where there is none, well that is up to the Liberal Party, but there is no basis for the allegations made by the Hon. Member for Bay Street.


Some Hon. Members:: Hear, hear!
October 15, 1985


Some Hon. Members:: Oh, oh!


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


Mr. Speaker:: Order. References by one side to Members on some basis other than their constituencies are just as out of order as references from the other side misnaming Ministers.
Let me suggest to all Members that the practice be stopped by both sides.


INDUSTRY
Mr. Mike Cassidy (Ottawa Centre):: I have a question for the Minister of Regional Industrial Expansion.
Is the Government prepared to accede to the request by the Donahue Company in Clermont, near Quebec City, for a subsidy of $16 million to help the company modernize its facilities and thus maintain some 300 jobs in the face of international competition?


Sinclair McKnight Stevens: Mr. Speaker, in response to the question from the Hon. Member for Ottawa-Centre I can only tell him that, in due course, if it appears appropriate to provide such assistance to the company he has referred to, it will of course be done. In the meantime the Government has no advice to offer the Hon. Member on this particular matter.
[ Translation]


MAINTENANCE OF QUEBEC'S POSITION IN NEWSPRINT PRODUCTION
Michael Morris Cassidy: My supplementary is as follows: Does the Government believe it is important for Quebec to maintain its position on the world market as a producer of newsprint? If so, is the Government prepared to provide some leadership in this area and find a way to modernize Donahue, or are you going to let this matter deteriorate until all the people of Quebec start putting pressure on the Government as they did in the Domtar case?


Sinclair McKnight Stevens: Mr. Speaker, the Hon. Member knows the circumstances surrounding the Donahue plant: the provincial Government involvement and the involvement of The New York Times. If he were to take the opportunity quietly to weigh all of the circumstances, he might frame his question in a different way.
Oral Questions


RESTRICTION ON ENTRY OF CANADIAN TECHNICIANS TO UNITED STATES TO SERVICE EQUIPMENT SOLD TO UNITED STATES
Mr. Jean-Guy Guilbault (Drummond):: Mr. Speaker, I have a question for the Minister for External Trade.
As a result of charges brought before the courts in California, Canadian workers and technicians may no longer enter the United States to instal and repair Canadian commercial and industrial equipment.
In my riding, Verville Incorporated, whose main customers are in the United States, cannot send its technicians to service their equipment.
Does the Minister intend to take the necessary action to clear up a situation that is causing a crisis in our Canadian industry?


Hon. James Kelleher (Minister for International Trade):: Mr. Speaker, I can advise the Hon. Member that where a contract was entered into prior to August 28, 1985, technicians will continue to enter the United States without any problem.
With respect to those contracts entered into subsequent to August 28, 1985, as a result of representations to the Attorney General of the United States, an appeal has been launched for a temporary staying order to the Ninth Circuit Court of Appeals, and we expect a decision on that this week.


IMMIGRATION
Mrs. Lucie Pepin (Outremont):: Mr. Speaker, my question is directed to the Minister of Employment and Immigration. Three weeks ago, departmental officials promised to facilitate the release of a number of refugees in Montreal who have been under detention for several months, without cause, and now that promise has been withdrawn, on the pretext that the refugees would fail to appear at their inquiry.
Could the Minister inform the House whether she intends to make use of her discretionary powers to have these people released as soon as possible?


Flora Isabel MacDonald: Mr. Speaker, there are ongoing discussions between the officials and the individuals concerned in the City of Montreal. I shall take notice of the Hon. Member's representations for the Minister of State for Immigration.

October 15, 1985
Oral Questions


REQUEST THAT DETAINEES BE RELEASED BY 3 P.M.
Lucie Pépin: I have a supplementary, Mr, Speaker.
The deadline given was today at 3 p.m. Could the Minister inform the House whether she will be able to release these people as requested, by three o'clock this afternoon?


Flora Isabel MacDonald: Mr. Speaker, as I said in my earlier response, I shall take the representations of the Hon. Member to the Minister of State for Immigration.

[ Translation]


TEXTILE INDUSTRY
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I have a question for the Minister of Regional Industrial
Expansion.
Last week, the Minister of State for Small Businesses informed the House that the closing of textile plants at Saint-Jean and Valleyfield was a matter that concerned the private sector and not the federal Government. My question, Mr. Speaker, is as follows:
Is the Government going to act responsibly and become involved in this decision, since it has already invested $2.6 million in modernizing these plants?


Sinclair McKnight Stevens: Mr. Speaker, in answer to the question of the Hon. Member, let me say that I feel that he has read something additional into my colleague's answer of last week.
1 listened to the answer most attentively, and I think he gave a full and fair answer to the question that was put to him.


Pauline Jewett: In other words, he doesn't know.


EMPLOYMENT-IMPORTANCE OF GOVERNMENT AID
Lorne Edmund Nystrom: In that case, Mr. Speaker, would the Minister not agree that this Government funding, and I mentioned $2.6 million, would justify the Government's intervening to ensure that the 850 workers in these industries are not laid off?


Sinclair McKnight Stevens: Mr. Speaker, again in answer to the Hon.
Member, let me say I think it is totally wrong to read into what my hon. colleague said last week that in some way there is not concern on the part of the federal Government in this regard. We have been having ongoing discussions with management concerning this matter and with the provincial Governments.
We have indicated that we want to work out, not just for the short term but for the longer term, an appropriate textile policy in Canada to ensure the viability, not just of such plants as the Hon. Member has referred to, but the industry in general.
What we would really appreciate is a little more co-operation from his Party in this connection.


Some Hon. Members:: Hear, hear!


Some Hon. Members:: Oh, oh!


TEXTILE INDUSTRY IN NOVA SCOTIA-MINISTER'S STATEMENT
David Charles Dingwall: Mr. Speaker, my question is for the Minister for International Trade. Last Thursday the Minister made the statement that in Nova Scotia there was no textile industry. In fact, Mr. Speaker, there are 3,000 Nova Scotians employed in the textile industry.
Will the Minister indicate to the House how Canadians in that province can expect a fair deal from the Government's handling of the free trade issue, when one of the Ministers charged with the responsibility of that file has made such an irresponsible and incompetent statement?


James Francis Kelleher: Mr. Speaker, I am quite prepared to admit that I was in error in making that statement.


Some Hon. Members:: Hear, hear!


James Francis Kelleher: There is indeed a vibrant textile industry in Nova Scotia. I certainly apologize to our former Leader, Mr. Stanfield, and his family business.


Some Hon. Members:: Oh, oh!


James Francis Kelleher: I certainly apologize to my friends in Nova Scotia and the Hon. Members from that province.


Some Hon. Members:: Hear, hear!


REQUEST FOR MINISTERIAL ASSURANCE
David Charles Dingwall: Mr. Speaker, I thank the Minister for his partial apology.


Some Hon. Members:: Oh, oh!
October 15, 1985


David Charles Dingwall: Would he apologize to the workers in Yarmouth, in Bridgetown, in Windsor-


Mr. Speaker:: Question, please.


David Charles Dingwall: Would the Minister give his personal assurances to the workers in Windsor, Truro, Yarmouth and Bridgetown that their economic interests will be treated equitably and fairly in all subsequent talks on the free trade issue?


James Francis Kelleher: Absolutely, Mr. Speaker.


CO-OPERATIVES GOVERNMENT RESPONSE TO TASK FORCE REPORT
Mr. Ernie Epp (Thunder Bay-Nipigon):: Mr. Speaker, 1 have a question for the Minister responsible for co-operatives, a Minister who undoubtedly does not need to be told that this week has been designated National Co-operative Week. The Government has been in office more than a year but has not yet issued a response to A Co-operative Development Strategy for Canada. What can the Minister tell us about plans to issue a substantial response to that report which was issued in May, 1984?


Hon. Charles Mayer (Minister of State (Canadian Wheat Board)):: Mr. Speaker, I thank the Hon. Member for his question. Co-operatives truly are an important part of the Canadian economy.
In direct answer to the Hon. Member's question, we have been working very closely with the co-operative sector developing a response to the task force report. I am happy to have the chance to announce that on Friday the federal Government will be hosting the first ever federal-provincial meeting of Co-operative Ministers in Regina as a way of getting input from the provinces into what precisely should be our response to the task force report.


REQUEST THAT CO-ORDINATING AGENCY BE ESTABLISHED
Abram Ernest Epp: Mr. Speaker, meetings are useful as far as they go but mechanisms are far more important. Does the Minister have plans to create a substantial co-ordinating agency within Government to bring the various activities of Government together to ensure that there really is a co-operative development strategy operating with the encouragement of the Government?


Charles James Mayer: Mr. Speaker, we are interested in doing whatever we can to assist the co-operative sector to develop and have a fair chance at Government programs just like every other sector. We have worked very closely with the co-operative sector and it has been my experience that it has been much more impressed with a good response than a quick response. It is my understanding that it is not at all interested in having another layer of bureaucracy. It is interested in having programs that
Oral Questions
are co-ordinated and do the best for the co-operative sector. That is exactly what the Government intends to do.


EXTERNAL AID
Mr. Bruce Halliday (Oxford):: Mr. Speaker, my question is directed to the Minister for External Relations. We understand that the Prime Minister, in a speech to the Commonwealth Press Union this morning, has pledged $25 million over the next Five years to assist developing Commonwealth countries to achieve total immunization of their children by the year 1990. Would the Minister tell the House what the projected scope and benefits of this initiative will be? In particular, given the past commitment of the Secretary of State for External Affairs to increased non governmental organizations' involvement in foreign affairs, will NGOs be expected to play a role in this latest initiative?


Pauline Jewett: That's a plant if there ever was one.
[ Translation]


Hon. Monique Vezina (Minister for External Relations):: Mr. Speaker, the NGOs will indeed have a major role to play within this immunization campaign, whose objective is to immunize all children throughout the world by 1990. 1 am proud to be administering this program, through CIDA.
As Hon. Members are no doubt aware, tomorrow, October 16, marks the tenth anniversary of the eradication of smallpox. Our Prime Minister and his Government have announced a $25 million immunization program over five years, which annually will save the lives of five million children suffering from these diseases-


Mr. Speaker:: Order, please! The Hon. Member for Saint-Henri-Westmount (Mr. Johnston).


NATIONAL REVENUE
Hon. Donald J. Johnston (Saint-Henri-Westmount):: Mr. Speaker, my question is for the Minister of Finance. Does the Minister agree that Canadians are entitled to know exactly how much money they have contributed in order to facilitate the acquisition of Gulf Canada?


Michael Holcombe Wilson: Mr. Speaker, 1 would assume that that is a question that the Hon. Member would like to answer himself. I think I know what he is driving at here. There has been speculation about a tax ruling and the Hon. Member knows, as a tax lawyers, that neither I nor the

October 15, 1985
Oral Questions
Minister of National Revenue are allowed to comment on particulars of a tax ruling according to the law. If the Hon. Member is asking me to break the law, then I would like him to say that.


AMOUNT INVOLVED
Donald James Johnston: Mr. Speaker, is the Minister telling us that disclosing the amounts involved in the ruling is breaking the law without disclosing the ruling itself? He said that he would not disclose the ruling. He has said that a number of times in the House, as has the Prime Minister and others. I am simply asking the Minister to tell us how much money was involved in the ruling so that Canadians will know how much they have contributed.


Michael Holcombe Wilson: Mr. Speaker, I put the same question to the Hon. Member that I put in my previous response. If he is asking me to break the law, let him say so. If he wants to have the law changed, let him make a proposal to change the law. Right now, under the law of Canada, neither I nor anyone else, as the Hon. Member knows as a former tax lawyer, would be able to comment specifically about any tax ruling, whether it relate to the Hon. Member as an individual taxpayer or to any corporation as a corporate taxpayer.


CANADA-UNITED STATES NEGOTIATIONS
Rodney Edward Murphy: Mr. Speaker, my question is for the Minister for International Trade. I think the people of Nova Scotia will accept his apology with regard to the remarks he made while he was in the province. However, how can the people of Canada feel confident about a Government negotiating on their behalf when it makes such a fundamental error?


James Francis Kelleher: Mr. Speaker, I think I have already answered the question. I believe that my apology stands and I have given my assurance that the industry will certainly be given every consideration in whatever negotiations take place between Canada and the United States.


CANADIAN POSITION
Rodney Edward Murphy: Mr. Speaker, my supplementary question is directed to the same Minister. Would the Minister's gaffe of last week not make it further necessary for Canadians to know exactly that position the Government is taking into the negotiations? Is that not something all Canadians must know?


James Francis Kelleher: Mr. Speaker, I can assure the Hon. Member that most of Friday in Halifax was taken up discussing with the provinces
their involvement in these negotiations. I am satisfied that the provinces feel that they will be fully consulted, and that will certainly take care of the problem to which the Hon. Member has referred.	.


GOVERNMENT EXPENDITURES
Mr. Sergio Marchi (York West):: Mr. Speaker, my question is for the Deputy Prime Minister and relates to the one-month African safari taken by the former Secretary of State. With regard to the $100,000 cost of Government aircraft alone, the Minister said the following over the weekend:
I would do exactly the same. I make no apology whatsoever.
I find this statement not only arrogant but callous and immoral. Does the Deputy Prime Minister support the Minister's profligate spending habits? Does he not agree that it would have been preferable and more humane to give $80,000 to the relief agencies in Africa that are helping Africans overcome the battle against famine? Does the Deputy Prime Minister not agree that that would have been the moral solution?


Hon. Erik Nielsen (Deputy Prime Minister and Minister of National Defence):: Mr. Speaker, I answered a similar question last week. I would point out to the Hon. Member that he is the last person to be speaking about a matter such as this, being a supporter of a Party which was previously in Government and expended 37.5 per cent more on government aircraft than this Government in a comparable year. That is a statistic that 1 would like the Hon. Member to explain regarding the operations of the previous Government.


Some Hon. Members:: Shame!


Sergio Marchi: Mr. Speaker, the only shame is for the Deputy Prime Minister not to have the courage-


Mr. Speaker:: Order.


REQUEST THAT TRAVEL DOCUMENTS BE TABLED
Sergio Marchi: Mr. Speaker, 1 would like to ask the Deputy Prime Minister, if he is talking about courage and legitimacy, if he has the moral courage and obligation to table in this House all documents referring to the expenses not only of the Minister, but of his wife and aide, while they were trucking across Africa for one month? Let Canadians decide if those expenditures were legitimate or illegitimate. Does the Deputy Prime Minister have the courage?


Erik Nielsen: Mr. Speaker, it is not a question of courage. If the Hon. Member paid the same attention to processes
October 15, 1985

which are available to him and to the general public in order to obtain that information which is freely available, as he did the Question Period today when speaking of aid to foreign countries-he seems to have completely missed the $25 million which has been expended on global immunization programs in favour of the kind of questions he is asking-he would find that the information is available. The Hon. Member should know the processes to obtain it.


CLERK OF PETITIONS' REPORTS
Mr. Speaker:: I have the honour to inform the House that the petitions presented by Hon. Members on Friday, October 11, 1985, meet the requirements of the Standing Orders as to form.



ROUTINE PROCEEDINGS

["Mr. Speaker, I have the honour to present a petition signed by residents of Dryden, Ontario, who call upon Parliament to make its best efforts in persuading the United States Congress not to pass legislation which would adversely affect Canada's softwood lumber industry."]
Mr. Speaker:: Presenting reports from Standing, Special or Legislative Committees. Tabling of documents. Statements by Ministers.
I take it Hon. Members have just noticed that we have gone through three items, have they?


Jean-Robert Gauthier: We didn't hear you.


Mr. Speaker:: Order, please. I will now revert back. I am trying to make a small point today, if I may. Neither the Minister, who is waiting to table a report nor the Hon. Member who is waiting to present a report, could hear the item being called, even though it is amplified. That is not their fault, it is the fault of the rest of the House.


Mr. Prud'homme:: Thank you, Mr. Speaker, for your understanding. It is true we could not hear.



Marcel Prud'homme: I have the honour, Mr. Speaker, to present the third report of the Standing Committee on Management and Members' Services.


INDIAN AFFAIRS AND NORTHERN DEVELOPMENT-THIRD REPORT OF STANDING COMMITTEE
Mr. John A. MacDougall (Timiskaming):: Mr. Speaker, I have the honour to present the Third Report of the Standing
Petitions
Committee on Indian Affairs and Northern Development in both official languages.
If the House gives its consent, I intend to move concurrence to the report later this day.
[Editor's Note: For above reports, see today's Votes and Proceedings.]


DEPARTMENT OF JUSTICE
Hon. John C. Crosbie (Minister of Justice and Attorney General of Canada):: Mr. Speaker, I have the honour to table the annual report of the Department of Justice for the year 1984-85 in both official languages.


PETITIONS
Rodney Edward Murphy: Mr. Speaker, 1 have the honour to present a petition signed by people from Prince Edward Island in which they state that the deduction of pension benefits from the unemployment insurance benefits would seriously interfere with the efforts of the employees and the community to create employment via early retirement pension packages. In their petition, the petitioners ask that all retired employees keep their pension benefits and receive their unemployment insurance benefits without deduction of pension income.


Mr. Benno Friesen (Surrey-White Rock-North Delta):: Mr. Speaker, I have the honour to present a petition gathered by citizens of Surrey-White Rock-North Delta who are concerned about the effects of the young offenders' legislation. They are concerned enough to have gathered 9,000 names. They point out the need to address problems of the ages of the young offender, that Section 11 should be re-examined, clearly defined and changed, that the statement to "person in authority" be more clearly defined, made uninational and changed; that Section 7(3) relating to custody should be subjected to a commission for study and to make recommendations, that the judicial system treat offenders and offences as serious and impose stiffer sentencing, and that-


Mr. Speaker:: Order, please.


Iain Francis Angus: Mr. Speaker, it is my honour to present a petition signed by a number of residents from across northern Ontario who attended a recent

October 15, 1985


Mr. John Parry (Kenora-Rainy River):: Mr. Speaker, I have the honour to present a petition signed by residents of Dryden, Ontario, who call upon Parliament to make its best efforts in persuading the United States Congress not to pass legislation which would adversely affect Canada's softwood lumber industry.



THE NATIONAL ANTHEM ACT


Mr. Reg Stackhouse (Scarborough West) moved: for leave to introduce Bill C-251, an Act to amend the National Anthem Act


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


Some Hon. Members:: Agreed.


Reginald Francis Stackhouse: The intent of this Bill to amend the National Anthem Act is to make a modest change of two words which would enable the National Anthem to reflect more aptly the current values of Canada on sexual equality.


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


[Stage Direction]
On the Order: Government Notices of Motions:
Petitions
New Democratic Party Northernary Council meeting in Thunder Bay. They call upon the Government to reverse itself on the question of deindexation for family allowances.
I have the honour to table also a petition circulated by a constituent of mine, calling for the reinstatement of full indexing of family allowances and signed by over 171 residents of my riding.

Mr. Gus Mitges (Grey-Simcoe):: Mr. Speaker, I have the honour to present a petition from the congregation of Annesley United Church, Markdale, Ontario, in my riding of Grey-Simcoe. The petitioners would like to see legislation passed to replace the Lord's Day Act which the Supreme Court of Canada has declared unconstitutional, and provide for one pause day in seven for the sake of family life and to provide the opportunity for those who want to worship to attend worship together.



IMPACT OF U.S. LEGISLATION ON CANADIAN LUMBER INDUSTRY

Mr. Jim Fulton (Skeena):: Mr. Speaker, I am pleased to table at this time a petition signed principally by residents of Dryden, Ontario, who are concerned about the possible impact of the Gibbons Bill and other protectionist legislation and the effect it would have on Canadian softwood exports to the United States. They are concerned that the Government of Canada is not taking adequate steps to deal with the consequences of that softwood lumber protectionist legislation.



CHANGES TO FAMILY ALLOWANCES AND CHILD TAX CREDIT PROGRAMS

Abram Ernest Epp: Mr. Speaker, 1 have the honour to present a petition on behalf of my constituents and other residents of notherwestern Ontario. These petitioners protest the Government decision to deindex the family allowance and point out that the changes in the child tax credit will not be adequate to offset what so that by 1990, as things stand, even the poorest families will be worse off than they would be if the present system were to continue.



CANADIAN PACIFIC RAILWAY PROPOSED ACTION

Abram Ernest Epp: Mr. Speaker, I have the honour to present also a petition on behalf of former employees of CP Rail who protest that the company has plans to do away with their lifetime pass privileges and to replace that with an unnegotiated health care plan. They were promised that they would have these passes throughout their lifetime and they bitterly oppose the action which is proposed by the Canadian Pacific Railway.
Oct 10, 1985-The President of the Privy Council: That, in relation to Bill C-79, An Act respecting the provision of compensation to depositors of Canadian Commercial Bank, CCB Mortgage Investment Corporation and Northland Bank in respect of uninsured deposits, one sitting day shall be allotted to the consideration of the second reading stage of the said Bill; and That fifteen minutes before the expiry of the time provided for the consideration of Government business on the above-mentioned sitting day, any proceedings then before the House shall be interrupted, if necessary, for the purpose of this Order and, in turn, every question necessary to dispose of the said stage of the said Bill shall be put forthwith and successively, without further debate or amendment.


Mr. Speaker:: Pursuant to Section (2) of Standing Order 26, this Government Notice of Motion stands transferred to and ordered for consideration under the Government Orders at the next sitting of the House.
October 15, 1985



INDIAN AFFAIRS AND NORTHERN DEVELOPMENT


John Alexander Frances MacDougall: Mr. Speaker, I should like at this time to move concurrence in the third report of the Standing Committee on Indian Affairs and Northern Development, presented earlier this day.


[Stage Direction]
Motion agreed to.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Paul Dick (Parliamentary Secretary to President of Privy Council):: Mr. Speaker, the following questions will be answered today: Nos. 167, 366 and 379.


Mr. Stackhouse: What will happen to the Voodoo aircraft with the acceptance of the CF-18 into the Canadian Forces inventory?


Mr. Robert Wenman (Parliamentary Secretary to Minister of National Defence):: As of December 31, 1984 when the CF-101 Voodoo was deactivated, the fleet totalled 48, comprising 16 flyable and 32 non-flyable aircraft. One aircraft will remain flying for the next two years in support of a special project. Twenty-three are being retained for non-flying technical training and support roles. The remaining 24 aircraft have either already been positioned for display or are in the process of being allocated for display at military bases, federal and public museums, communities and veterans' organizations.


Mr. Caccia: 1.	Will the Government undertake assessments of the environmental impact of the North Warning System plans across the Canadian North?
2.	Who is responsible for the environmental aspects of the plans?
3.	Will native concerns and those of civilian experts on the Arctic environment be heard and, if so, in what manner?
4.	Will North Warning System sites be on unsurrendered native lands and, if so (a) what provisions have been made for informing the owners of these lands (b) has any agreement been sought and/or obtained and (i) if so, under what conditions (ii) if not, for what reason?


Robert Lloyd Wenman: 1. Yes, although final locations for the Short Range Radar (SRR) have not been finalized, initial screening has been carried out in conjunction with the Department of Indian Affairs and Northern Development (DIAND). Once site locations are confirmed environmental assessments will be carried out.
Order Paper Questions
2.	The Department of National Defence (DND) is responsible for the environmental aspects of the plan. The Federal Environmental Assessment Review Process (Order in Council, June 21, 1984) will apply. DND will seek the advice and guidance of DIAND and the Department of the Environment (DOE) throughout the process.
3.	Yes, community consultations will be held and site visits will be made during the preparation of the environmental assessments. Upon completion, the report(j) will be made public, and anyone can make interventions for consideration by the Department.
4.	Some North Warning System sites may be on lands where aboriginal claims have been or are being negotiated. The Department will keep the native negotiating bodies and individual communities apprised of project details. Discussions on conditions for land use and occupancy and environmental protection will be part of that information process.


Mr. McKinnon: 1.	On March 31 (a) 1981 (b) 1982 (c) 1983 (d) 1984, what total amount was at the credit of the Canadian Forces Superannuation Account?
2.	During (a) 1981 (6) 1982 (c) 1983 (d) 1984, what rate of interest did the Government pay for the use of this money?
3.	What amount of interest was credited to the Account during the fiscal year ended March 31 (a) 1981 (b) 1982 (c) 1983 (d) 1984?
4.	For each of the above fiscal years, what was the total amount (a) paid into the Account by service personnel (A) paid from the Account?
5.	What portion of the amounts paid into the Account for each of the above years, represents contributions towards indexation of the Fund?


Robert Lloyd Wenman: October 15, 1985
Canada Shipping Act
(a)	$ 80,056,222.
(b)	$ 91,295,399.
(c)	$104,348,025.
(d)	$113,166,394.
(b)	The amount paid from the account for the years in question is as follows:
(a)	$280,886,649.
(b)	$306,909,882.
(c)	$327,196,681.
(d)	$345,626,573.
5.	Members' contributions shown in 4(a) are paid into the Canadian Forces' Superannuation Account for provision of basic pensions. Indexation of basic pensions requires additional contributions (1 per cent of salary) by members and are paid into the Supplementary Retirement Benefits Account (SRBA). Contributions to the SRBA for the above years were:
(a)	$14,738,376.
(b)	$16,972,634.
(c)	$19,540,469.
(.d) $21,182,091.
[ Translation]


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


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


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Mazankowski that Bill C-75, an Act to amend the Canada Shipping Act and to amend the Arctic Waters Pollution Prevention Act, the Maritime Code Act and the Oil and Gas Production and Conservation Act, be read the second time and referred to a legislative committee.
Mr. Speaker:: When the House adjourned there was a period of questions and comments following the speech of the Hon. Member for Gander-Twillingate (Mr. Baker).


Jean-Robert Gauthier: Mr. Speaker, I welcome this opportunity to take part in the debate on Bill C-75. I was most interested in the remarks and comments of my hon. friend from Gander-Twillingate (Mr. Baker), when he mentioned to the House that Clause 4 of Bill C-75 reads as follows:
For the purpose of defraying the cost of navigational services provided by the Canadian Coast Guard, the Governor in Council may make regulations respecting charges relating to those services, including, without limiting the generality of the foregoing, aids to navigation, dredging, vessel traffic services, ice breaking services and escorting services.
In fact, Mr. Speaker, the explanatory note says, and this is very straightforward:
New. This amendment would provide the authority for the Coast Guard to recover the cost of providing navigational services.

As was brought to our attention by the Hon. Member for Gander-Twillingate (Mr. Baker), this Bill means that boat owners, more specifically fishermen, could be charged certain fees which today they do not have to pay. Fees could be charged for, say, urgent situations where a boat is unable to proceed because of difficulty with its engines. There could be a lot of such difficult situations and the fishermen would have to cope also with an additional cost to their operation. Can the Hon. Member explain further his views on this important clause and tell us how the fishermen of his riding, which I understand he visited recently, feel about this clause?


George Baker: Mr. Speaker, let me make it perfectly clear what this Bill means. I will give the Hon. Member an example. Right now at this very minute there is no such charge in place if a fellow wants to leave a harbour and go fishing. What this Bill would do is to enable the Government of Canada to impose a charge to dredge the harbour this fisherman is leaving from. It enables the Government to charge for the use of an ice-breaker so that fishermen can get out in early spring. Not only that, if he uses Marine Radio, which is a navigational aid as such, then the Government of Canada could charge him for that. Suppose his propeller breaks while he is out at sea. He needs assistance to be brought back into port. The Government of Canada can charge him for escorting his boat back into port. Isn't this incredible? That is in Clause 4 and that is what is wrong with this Bill.
It was not enough for the Government of Canada to turn around last winter and impose a charge on all Canadians who phone the weather office. Here we have a fisherman or boat owner who is not going to want to check on the weather because he has to pay for it, and he is going to wonder whether he should really go out early in the spring to fish because he is going to be charged to have the ice in the harbour broken up. He is going to hesitate to phone Marine Radio because he is going to be charged for that.


Mr. Tobin:: In a life-threatening situation.
October 15, 1985


George Baker: Yes. Here he is with problems in his motor 100 miles out in the ocean and he will hesitate to phone the Coast Guard.
This Bill is an absolute affront to all boat owners in Canada. The Minister of Justice (Mr. Crosbie) is in his place today and I am sure that he will check the Terms of Union between Canada and Newfoundland because I believe, from my reading of that document, that this Bill violates the Terms of Union. It says that this service will be provided by the Government of Canada. Not for a charge; it will be provided in a continuing fashion. All in all, as the hon. gentleman pointed out, this clause in the Bill is absolutely disastrous for the fishermen in all of Canada, on the East Coast or the West Coast.


J. Michael Forrestall: Mr. Speaker, the implication of the comments made by the Hon. Member for Gander-Twillingate (Mr. Baker) are, of course, that it is the Government's intention to charge 100 per cent of the cost. There is no intention of doing that whatsoever. It would be against the great traditions of this House and successive Governments over the lifetime of our country to attempt to do that. What we are attempting to do is to put in place enabling legislation to recover some of these costs. We presently recover about 2.4 per cent of marine costs. Who does the Hon. Member think is paying for it now?


Jean-Robert Gauthier: All taxpayers.


J. Michael Forrestall: Who pays for the dredging of the harbour? There is no harbour in Ottawa-Vanier.


Jean-Robert Gauthier: That does not matter.


J. Michael Forrestall: But you pay for it.


Jean-Robert Gauthier: Yes.


J. Michael Forrestall: So why don't the users of harbours, the ones who benefit directly, begin to pay a little bit more?


Jean-Robert Gauthier: I can't believe you, Michael.


Brian Vincent Tobin: I am going to send this speech back home.


J. Michael Forrestall: Another comment which should be made, Mr. Speaker-


Brian Vincent Tobin: Who pays for the Ottawa airport? Not the people in small fishing harbours. They do not use it but who pays for it? The taxpayer.


J. Michael Forrestall: The air services, for the Hon. Member's edification, recover about 35 per cent or 36 per cent of their cost. If we are to continue the level of service which is enjoyed by fishermen and small craft owners, not to mention the commercial services and bulk carriers, then funds have to be found to maintain navigational aids, dredging and ice clearance.


Brian Vincent Tobin: Who pays for the National Capital Commission?
Canada Shipping Act


J. Michael Forrestall: Money has to be found and where does the Hon. Member think the money is coming from? He knows that this Government is obliged to pursue deficit reduction. This is what we are doing. When the Hon. Member or any Hon. Member rises in this Chamber and suggests that through Bill C-75 the Government is attempting to recover 100 per cent of these costs, he is misleading the people in the Chamber and the people in the country.


George Baker: Mr. Speaker, I am glad to hear that the Parliamentary Secretary to the Minister of Transport (Mr. Forrestall), who obviously knows the Government's policy, is saying it is not going to charge 100 per cent of the cost. I wonder whether it is 99 per cent, 98 per cent, 50 per cent, 10 per cent, or 2 per cent of the cost of an ice-breaker. An ice-breaker costs about $1,000 an hour. What is the cost to the people of Canada? He talks about saving money. The Government did not think about saving money when it recently allocated $1 billion for the bail-out of certain uninsured depositors in a bank. It did not think about saving money when it spent over $10 million to put a communications system in the Prime Minister's office. It did not think about saving money when it increased the staff by 54 per cent to 120 people.
That argument does not apply in this case when we are talking about our primary producers, safety at sea, and trying to assist poor fishermen in the country at this time of the year. That argument just does not hold any water at all.


The Acting Speaker (Mr. Paproski):: The period for questions and comments is now terminated. The Hon. Member for Bonavista-Trinity-Conception (Mr. Johnson) on debate.


Mr. Morrissey Johnson (Bonavista-Trinity-Conception):: Mr. Speaker, as I rise to speak on Bill C-75 I would like to say that I believe that most of the amendments contained in this Bill are long overdue and I certainly hope that the Bill will be given quick passage by the House. I feel that all Canadian seafarers and all seafarers who ply Canadian waters will be glad to hear of the emphasis in this Bill on safety at sea. As well as enhancing safety at sea, this Bill will enable Canada to deal more effectively with matters associated with the prevention and clean-up of marine pollution and will provide an improved scheme for attributing liability and paying compensation for all pollution damage caused by ships at sea. In addition, Mr. Speaker, the amendments will enable Canada to ratify a number of important international maritime conventions which we have been unable to do because of the lack of enabling legislation.
I believe that Canadians can and should be proud of the Canadian Coast Guard as it presently exists. This Bill has been drafted to allow the introduction of additional Coast Guard services such as aids to navigation, ice-breaking and dredging.
I am sure that Hon. Members will appreciate my reference to the fact that most of the amendments put forth in this Bill have been discussed in public hearings across Canada. I have

October 15, 1985
Canada Shipping Act
personally discussed some of the amendments as far back as 1983. Hearings have been held across Canada from St. John's to Vancouver over the last few years. You can see, Mr. Speaker, that industry has been consulted on the amendments put forward in this Bill and has been given the opportunity to have in-put in them.
As with all legislation, 1 am sure that there are those who will find fault with this Bill, as the Hon. Member for Gander-Twillingate (Mr. Baker) has already done. I feel confident that the Government will move quickly to make additional amendments to the Canada Shipping Act if and when they become necessary. As I have already said, the amendments in this Bill have been a long time coming and the Bill should be given speedy passage.
This morning the Hon. Member for Gander-Twillingate referred to the Ocean Ranger disaster. I am sure that all of us who know of that disaster were deeply touched by it. The Hon. Member failed to say that his Party was in Government at the time of that disaster. It should have moved quickly at that time to bring in the regulations to which he referred this morning. However, it did not do that. He also failed to point out that Bill C-75 will improve construction and equipment standards of mobile off-shore drilling units such as the Ocean Ranger.
1 should point out that this Bill provides for the recovery of costs for certain services that are now provided for without charge by the Canadian Coast Guard. It does not set out what the charges will be and I believe that the Government will be discussing the proposed charges fully with industry before any charges are implemented. I say that, Mr. Speaker, because, unlike the previous administration, this Government believes in and practises consultation.
There are many reasons why the amendments in Bill C-75 are put forward. I think we all agree that there is an urgent need to amend the Canada Shipping Act. For several years we have been trying to implement a maritime code in Canada. I do not believe that we can go on without passing amendments to allow the Government to take the necessary action with regard to the construction of ships and to having master's and seaman's certificates improved and modernized. This Bill will also provide for the implementation of the International Maritime Organization convention for the standard of training and for the introduction of medical examinations for seafarers. At the present time I believe that the only medical requirement for anyone obtaining a certificate as a master, mate, or engineer on a ship is to have an eye examination. At times the lives of thousands of people depend on the physical and mental ability of those in charge. The requirement for periodic medical check-ups for officers on ships is long overdue.
I spoke earlier about construction equipment and certification provisions for ships. One of those which will be important is the code for the construction of equipment and ships carrying liquefied gases in bulk and those carrying dangerous cargoes. With regard to the disaster to which I have already referred, I hope that more stingent regulations will be brought in for the construction of drilling rigs and so on. I have to
agree with the Hon. Member for Gander-Twillingate that the Bill may not go far enough. With oil exploration and development about to take place off the east coast of Canada, there should be more detailed legislation setting out what type of ship should be used. In particular, the legislation should make it compulsory to have ships, other than the traditional supply vessels, standing by the oil rigs. We should follow the example of the United Kingdom, Norway and other countries and make it compulsory to have those stand-by ships in place. I believe the Bill should take that into consideration.
Although the charges have not been set out in this legislation, I am sure that as people from the Department of Transport consult with ship owners and operators in Canada, any increases that must be imposed to recover some of the costs will be modest.


George Roland Henderson: My question for the Hon. Member who just spoke concerns Clause 4 of Bill C-75. That clause explains the purpose of adding more revenues through user fees.
First, I want to draw to the Hon. Member's attention the situation that will be faced by my Province of Prince Edward Island with regard to ice-breaking as a result of Clause 4. As he knows, agriculture is the main industry in Prince Edward Island and potatoes are the primary product grown there. The Hon. Member, being a former sea captain, is aware of the ice conditions in the Gulf of St. Lawrence and the Northumberland Strait during the winter, when there are two and a half to three months of virtual freeze up. At that time we must rely heavily upon ice-breaking services to ship our produce- mainly potatoes-to market.
Prince Edward Island is a seed growing area. It probably grows the best seed potatoes in the world. In my six years in this place, representing the riding of Egmont, I have been asked by producers and shippers of potatoes on several occasions to obtain the services of an ice-breaker in order to allow vessels in and out of Summerside harbour from where approximately 85 per cent of all potatoes grown on P.E.I. are shipped. The Hon. Member for Gander-Twillingate (Mr. Baker) stated that it costs approximately $1,000 an hour for ice-breaking services. The Hon. Member who just spoke stated that although the regulations would be in the legislation, the user fees may or may not be imposed. I want to tell the Hon. Member that with respect to legislation that is passed, it is too late to close the barn door after the horse has been stolen. Whether it is the present Minister, a Minister of the Government which may follow, or any other Government, if difficult economic times arise, this legislation would be in place and could suddenly become an avenue through which revenues could be taken by a Government. That is why I do not like Clause 4. If the Government does not intend to impose user fees it should say so and delete this Clause. It is too open-ended.
Let me explain the current situation facing the potato industry in my province. The cost of production of potatoes is a bare minimum of 5 cents per pound. The cost to potato
October 15, 1985

farmers at the farmyard f.o.b. is 1.5 cents per pound. Since the farmer is already losing 3.5 cents a pound, how much longer can the agricultural industry survive? If the cost of ice-breaking services, dredging services and those other services which usually come from general revenue are added, the cost will probably be up to 6.5 cents a pound.
EIow does the Hon. Member believe his Government will use Clause 4 once this legislation is passed?


Morrissey Johnson: Mr. Speaker, first 1 would point out to the Hon. Member for Egmont (Mr. Henderson) that 1 stated at the beginning of my remarks that I believe most of the amendments were long overdue. I did not say that I agreed with everything in Bill C-75. I pointed out that it would be almost impossible for any legislation that is introduced to be perfect. There will be those in any nation who will find some faults in their legislation.
Let me point out to the Hon. Member that I know of cases where ice-breaker services have been called upon not to provide ice-breaking services but to have fuel or food put on board vessels. That is why I am not entirely opposed to Clause 4. I think the Government should recover the costs of those services that are provided to put fuel or food on a vessel. I do not believe that charges for ice-breaking services in the Maritimes, whether it is Newfoundland, P.E.I., Sydney harbour or Cape Breton or the St. Lawrence River will be made if it is to enable ships to carry on the commerce of this country and ship exports to other countries or bring produce from one province to another.
I am quite familiar with the Hon. Member's Province of Prince Edward Island. I have shipped a good many loads of spuds from that province. Sometimes I have had to put heaters in the hold to raise the temperature before loading the potatoes because they would freeze before we got the hatches back on.


The Acting Speaker (Mr. Paproski):: Questions and comments are now terminated. Debate.


Abram Ernest Epp: Mr. Speaker, I rise to join in this debate on Bill C-75 with decidedly mixed feelings. The debate has already focused on some of the strengths of this Bill as well as some of its weaknesses. It is worth taking a few moments to consider the contributions this Bill will make to the statute law of this country as it deals with an important part of our transportation system, specifically the support and regulation of shipping in the waters of this country.
The Government has often given us the impression that regulation is detrimental. The former Liberal Minister of Transport actually created the impression as well that deregulation would be the direction of the future.
It is good to see legislation which recognizes those matters of life and death, safety, prevention of pollution and so on, for which the Bill provides. It is also good to see that the Government recognizes there are situations in which regulation is
Canada Shipping Act
quite essential and provides us with a Bill which makes provision for these areas. Since we are honoured this afternoon to have the Minister of Transport (Mr. Mazankowski) listening to the debate, surely it would not be inappropriate for me, as a member of one of the opposition caucuses, to commend him for that. I trust that all movements in the deregulation policy of the Government will be carried out with regard for the safety of travellers and for the safety of the environment. Surely the changes will not be carried through in any blind pursuit of some principle without regard for the environment and for people who work in the industry as well as those who travel on aircraft, trains, buses or whatever, for whom the Minister of Transport has responsibility.
Recognizing that the process of deregulation has been judicially handled in this particular area by the Minister, I also recognize that the Bill contains a variety of provisions which is long overdue. I suspect that it would not be unfair, although it may have been a more extreme case, to compare this Bill with the Aeronautics Act which we considered some time ago. There were significant revisions and amendments to update legislation largely dated back to the inter-war years, which makes it more than a half-century ago. Surely the preceding Liberal Government was not very concerned about the infrastructure or transportation system of the country or about legislative provisions for it. If at times I am inclined to say nasty things about this particular Government in terms of the slowness with which it arrives at initiatives for us to consider, some of these matters deserve to be recognized as more than just housekeeping legislation because they in fact update legislation which provides for our basic transportation system.
The most unfavourable part of the Bill before us is the particular provision which has already received a great deal of attention, the provision which would enable the Minister or the Government to institute a cost recovery system against our shippers for Coast Guard services. The Hon. Member for Thunder Bay-Atikokan (Mr. Angus) already recognized the very real danger that those particular charges could only be part of an increased loading of cost on the transportation system, particularly in the St. Lawrence Seaway, with which shippers may be faced in 1986 and years thereafter. We recognize that particular possibility and consider the importance of the transportation system to Canada. It is important to northwestern Ontario and to the great City of Thunder Bay to which I want to devote a little of my attention this afternoon. We have real reason for concern about part of the Bill and powerful reason for asking the Minister to reconsider Clause 4 and give up the idea of any kind of cost recovery.
After all, it is in a time of recession, at the very least, that this proposal comes before us. There are enough Canadians facing situations which seem to be ones of depression. 1 recognize that it is tempting for a Minister to contemplate some possibility of recovering costs in terms of his contribution to the deficit reduction program of the Government. However, there is such a thing as short-sighted reduction which makes Canadian industries even less competitive than they might be in other circumstances, which reduces economic activity in the
7650

October 15, 1985
Canada Shipping Act
country, and which ends up increasing the deficit by loading other costs on to the Consolidated Revenue Fund, particularly the cost of unemployment insurance and the loss of revenue, whether it be individual income tax or corporate income tax. Those particular dangers require careful calculation before one is ready to undertake anything of the sort the Minister is seeking authorization to do. Simply, it is very easy to undertake such measures as these for reasons which are a little more than ideological but are regarded as important matters of principle and, in the process, to act against the national interest of the country.
The Canadian nation was not built upon cost recovery. It was not built upon the expansion of market opportunities for their own sake. Surely it was built upon and found expression in policies designed to enlarge opportunities, frequently by putting costs on the Consolidated Revenue Fund and by carrying out investments which would be justified if the country were to be seen in over-all corporate terms. I am referring to social investments which made it possible for people to settle in the Canadian West and in that process improve the land, grow grain and find a market for it. For me, being from Thunder Bay, to talk about the importance of the western settlement, land improvement and wheat production, is simply to recognize the fact that the most important trade through the Port of Thunder Bay is the trade in grain. In 1984, the most important product which went through the Port was grain, for a total of 16.6 million metric tons. That total is evidence of the extent to which the Port of Thunder Bay is a junction between western grain growers and shippers on the Great Lakes moving grain toward domestic markets to the East, and, even more so, on the export markets beyond the North American continent.
If I compare the quantity of grain moved with the amount of coal which went through the port at 2.78 million metric tons, one has a real indication of the dominance of the grain trade in that port. Also it helps one to appreciate the way in which great terminal elevators dominate the lakeshore along the bay and provide the point of linkage between trains from the West and vessels from the East.
The importance of the grain trade is not only a matter of the business done in Thunder Bay. After last year's decline of 25 per cent from the preceding year, this year we have a further decline of 40 per cent in grain movement. For weeks and months during the summer-time practically nothing happened in the port and hundreds of elevator workers were laid off. Some were laid off for more than a year. They realized, as it went into the summer and continued into the fall, that it was unlikely they would be called back for the moment and perhaps never called back again. We have a daily experience with those circumstances. I visited the Port Arthur Shipbuilding company and talked with managers and workers there. I was told how very slow business was this year. When ships are not moving, they do not have the good fortune to move grain nor do they have the bad fortune for them, to rub bottom at various points and to suffer other minor damage which make it possible for that company to do its jobs in ship repair.
As a result, employment at the shipyards falls off sharply, and in one area after another the same is true. The Seafarers' International Union is talking in terms of 2,500 of its members not being at work this year, and both CN Rail and CP Rail have laid people off.
We are experiencing what can happen when factors go against an industry. Initially we were told that the decline in the grain crop in the West was to blame. However, we also have anxiety about the cost factors that make it less attractive to ship through the Port of Thunder Bay, thus leading to these effects in the Port of Thunder Bay and in ports all along the system, including the Port of Montreal and beyond.
At point after point the factors that slow the movement of grain and of other freight through the Great Lakes system have a serious effect on employment and business activities. It is for that reason, Mr. Speaker, that my colleague, the Hon. Member for Thunder Bay-Atikokan, and I feel, as I am sure others do, so deeply the necessity of asking the Minister of Transport, to reconsider Clause 4 of the Bill. Our desire is to prevent any possibility of additional costs being added to the use of the system.
The centennial of the construction of the Canadian Pacific Railway is almost upon us, and in the case of the St. Lawrence Seaway we have a system that is nearing the 30-year mark now-which, incidentally, might underscore the damage suffered as a result of the collapse of part of the wall of a lock in the Welland Canal system, a point which was pursued briefly in Question Period earlier this afternoon. It is clear that we need not only to undertake every measure to reduce the costs on the system but to invest the money to ensure that the system is in first class condition.
We speak readily these days about things being "world class" and "state of the art," and so forth. Well, the canals on this system have been around for quite a while. The Welland Canal, of course, is rich in history, the first construction having taken place in the late 1820s, with a series of reconstructions and expansions following as one canaly system has succeeded another.
I do not mean to suggest to the Minister that we need yet another Welland Canal built-although, given the size of vessels today, that is a topic that is perhaps worth thinking about. In recession circumstances, I do not suppose that the Minister wants to contemplate such a project. Nonetheless, Mr. Speaker, we have to ensure that the system is as efficient as it can be and that the costs to the carriers are kept down. Those are the important points that I wish to note critically about this Bill. Clause 4 presents some very dangerous prospects for the shippers, a perilous possibility for the Government to act upon.
Perhaps I could now say something about the second largest trade done through the Port of Thunder Bay, the trade in coal. The figures in respect of the trade in coal underscore the importance of keeping costs down to the various industries in Canada and in fact to Canadians generally, as I shall demon-
October 15, 1985

strate in a moment. I note, Mr. Speaker, that the second largest trade in 1984 done through the Port of Thunder Bay was that in coal, with a shade over 2.75 million tonnes passing through the Port of Thunder Bay. As Canadians who know their economic geography are well aware, Canada has been most unfortunate in terms of the location of its energy resources vis-a-vis the centres of industry in this country.
J. B. Brebner, in his mid-1940s publication dealing with Canadian-American industry-a publication which became in fact a study of the North Atlantic Triangle-pointed out something that we Canadians can so easily forget, that being the reality that the Americans have with iron ore at the upper end of the lakes and coal just south of the central lakes, or lower lakes, if you will, and that incredible transportation system linking the two. It is, after all, on that reality that American industrial might for 100 years was built. That reality led to the building of the great Rockefeller fleet and others to carry the iron ore to the areas of the coal deposits, which in turn led to the establishment of the great steel mills, the automobile industry, and so forth. Those were the factors that helped make America the industrial power that it is.
Where were we Canadians? Well, we had our centres of population in the St. Lawrence Valley/Lower Great Lakes region. We had our small iron ore deposits on the Canadian side of the international boundary. But where was the coal? Well, the coal, of course, was off in Cape Breton and in other places in the Atlantic region and in the Rocky Mountains and on Vancouver Island. Given that the coal was to be found at the far reaches of the country and the iron ore in the centre, it became difficult to build up industry. As we all here appreciate, the ore is hauled to the coal. One does not, as a rule, haul the coal great distances, only to burn it up at its destination.
The remarkable fact since the mid-1970s is that it has proved feasible, to some extent, to move coal from the Rocky Mountains and the lignite deposits of eastern Saskatchewan eastward across the Prairies and the northwestern Ontario part of the Shield and then on to the lakes and down the lakes to industrial users in Sault Ste Marie and Hamilton and on to the thermal generating plants of Ontario Hydro.
The fact that it has become possible to do that is a remarkable achievement. It is, in its way, a small revolution, if you will, and certainly a remarkable addition to the potential economic geography of this country. However, the necessity, of course, is to keep costs down. Ontario Hydro would be quite happy to burn a good deal of western Canadian coal, particularly when one considers that it is coal that is low in sulphur, thereby producing far less of the acid rain-producing emissions which result from the burning of American coal. That particular feature is one that is well worth noting. After all, it was just this afternoon that a Government private Member was spotlighting the dangers from acid rain, emphasizing the importance of dealing with this menace.
As anyone who is exploring this topic these days realizes, it is only in the last year or two that the consequences of acid rain have become so very obvious. Large numbers of trees have been lost in the forests of Europe and the forests of the
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Appalachian Mountains. Prior to that time, it was thought that it would be years before the consequences of acid rain would be obvious in the forests of this continent and the forests of northern Europe, and now suddenly we find that there are large numbers of trees that are unable, as a result of the acid rain emissions, to survive the diseases that beset them, leading to the loss of many of our trees.
In the circumstances, Mr. Speaker, anything that will make it possible for Ontario Hydro to move to a level of 50 or 55 per cent of Canadian coal being burned in its furnaces in order to generate electricity is something that should be undertaken. The challenges, of course, are quite real. American coal is all too close at hand on the other side of the lakes. The cost of moving American coal to the generating stations of Ontario Hydro is in the $2-a-tonne range. When Ontario Hydro faces a cost of moving Canadian coal to its plants in the $7-a-tonne range, it undoubtedly becomes a matter of significance.
It is in such circumstances that we surely want to do everything we can to ensure that costs are kept down and that the St. Lawrence Seaway can to continue operate effectively in providing the transportation means needed for the various resources of the country.
Mr. Speaker, I know you have a limit to your patience. Thank you for having given me this opportunity to ask the Minister to think very carefully about Clause 4 in terms of its removal from the Bill.


Some Hon. Members:: Hear, hear!


The Acting Speaker (Mr. Paproski):: We will now entertain questions or comments on the remarks of the Hon. Member. The Hon. Member for Thunder Bay-Atikokan (Mr. Angus).


Iain Francis Angus: Mr. Speaker, I would like to ask my hon. colleague if he could advise us as to the impact of Clause 4 on the forest-based industries, not only in northwestern Ontario from where we both come but in Quebec, other parts of Ontario and perhaps even British Columbia. Will this have an adverse effect on its competitiveness in the world pulp, newsprint and lumber markets? Perhaps the Hon. Member could advise us as to his understanding of the situation.


Abram Ernest Epp: Mr. Speaker, I have to thank my colleague, the Hon. Member for Thunder Bay-Atikokan, for that good question. In responding to it, I think immediately of the extent to which the American lumber producers, in their efforts to meet the Canadian competition, experienced difficulties because of the Jones Act which requires that cargoes which move between American ports and do a coasting trade be carried in American bottoms. That creates cost disadvantages because, as has been shown in Canada, the Government has rejected any possibility of a deep-sea marine policy, although I must say-and this may cut against my own argument-that I wish that we in Canada had something similar to the Jones Act making it possible to build up, on the basis of our large export trade, a Canadian

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merchant marine. The question that we are debating this afternoon regarding the viability of industries is at the very heart of that particular question.
My colleague has given me the opportunity to point out that if the movement of forest products from this country was affected by increased costs, there would be very unfortunate consequences for the industry. The Hon. Member for Skeena (Mr. Fulton) came to northwestern Ontario two or three weeks ago to discuss with us the dangers facing lumber producers. At that point, we were thinking primarily of lumber producers being faced with the prospect of Congressional action which could put countervailing duties against Canadian lumber products or take even more drastic forms like the Gibbon Bill. When we spoke to people in the industry, we found that they were underscoring the closeness with which they had to cut their costs and the fact that they were making very little money when trees are being cut 200 miles from the mill and trucks have to go back and forth. That 400-mile round trip creates an incredible cost.
I might note, since it was one of the most interesting days in the early part of this parliamentary Session, that when we were debating last December the question of sales and excise tax increases, there was a most interesting debate on the question of a reduction in the rebate on the fuel tax for fuel used by the forestry industry not only for equipment but for transportation. I am sure you would agree with me, Mr. Speaker, that one of the reasons the combined Opposition defeated the Government on a voice vote that auspicious Wednesday afternoon was that a number of private government Members were convinced along with us that the sales tax should not apply to fuel being used by logging trucks operating on the roads.
The Hon. Member for Kootenay West (Mr. Brisco) spoke with some passion on this particular matter that day and he was only one of the private government Members who felt strongly along with my colleagues and particularly my colleague, the Hon. Member for Thunder Bay-Atikokan, about that point. That is a little bit of parliamentary history illustrating the same point we are discussing today.
Where we can avoid costs, let us find the means to do so in order to ensure that the industries remain valiable, employment is maintained and profits continue to be made. After all, we do need some kind of a base for taxation, and let a New Democrat say so occasionally.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
[ Translation]

The Acting Speaker (Mr. Paproski):: It is my duty, pursuant to Standing Order 46, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: The Hon. Member for York East (Mr. Redway)-Income Tax-Introduction of minimum tax; the Hon. Member for Don Valley East (Mr. Attewell)-Customs and Excise- Planned reductions in inspection personnel; the Hon. Member for Gander-Twillingate (Mr. Baker)-Fisheries (a) Refinancing of Fishery Products International (b) Company's social responsibility.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Mazankowski that Bill C-75, an Act to amend the Canada Shipping Act and to amend the Arctic Waters Pollution Prevention Act, the Maritime Code Act and the Oil and Gas Production and Conservation Act in consequence thereof be read the second time and referred to a legislative committee.
Brian Vincent Tobin: Mr. Speaker, I am pleased to participate today in the discussion on Bill C-75, the Canada Shipping Act. Let me say at the outset that 1 agree with the Hon. Member for Bonavista-Trinity-Con-ception (Mr. Johnson) who indicated that there are many amendments contained in this Bill that are long overdue, much needed and proper. Having said that, let me also say that in some very important ways, this piece of legislation is more noteworthy for what is not contained within it than for what is.
Nearly four years ago on February 15, 1982, the drilling rig Ocean Ranger went down off the coast of my home province and took with it 84 lives. Among those 84 lives were 69 Canadians and 56 fellow Newfoundlanders. One of the ways the Government of the day, in conjunction with the Government of Newfoundland, reacted after some weeks and months to that tragic disaster was to commission a joint federal-provincial royal commission to examine the circumstances that led up to the disastrous night of February 15, 1982, to examine the regulations that were in place at the time of the disaster to

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see if they were sufficient and to examine the safety standards and practices that were employed at the time of that disaster.
The royal commission to which I referred produced a very comprehensive and excellent report. It was detailed, it uncovered every stone and it looked at every facet of the events leading up to this marine disaster. The report was passionate in its approach and committed to preventing such occurrences from happening again. I am told that it was a $15 million exercise.
The commissioners made some very specific recommendations to the Minister of Transport and tabled a report in August, 1984, about a month before the last election. They made some very specific recommendations to the Government of Canada, recommendations that they hoped would be contained within pending changes to the Canada Shipping Act, the Bill that is before us today.
While I will acknowledge that some of the recommendations made have been included in Bill C-75, the single most important recommendation has not been adopted in Bill C-75. I am sure it will astound Members of this House to know that when an oil rig operates 200 miles offshore the regulations contained in the Canada Shipping Act do not apply to that oil rig. The Minister of Transport (Mr. Mazankowski) under the Canada Shipping Act has no authority over the operation of that rig under that Act when it operates 200 miles offshore. One of the primary recommendations contained in this report was that the Shipping Act be changed and the provisions of the act encompass rigs operating offshore. That has not been done, Mr. Speaker. Words, discussions, and policy formulation and debate in this palatial Chamber seldom resembles the reality of the real world. For example, our agricultural policies seldom resemble the impact on farmers in western Canada. The fishery policy seldom resembles the impact it has on fishermen in Atlantic Canada. When we talk about safety regulations and a royal commission, nothing we say here makes us truly undestand why it is important that the Government of Canada under the Shipping Act regulate rigs operating offshore. I would like to refer to the report of the royal commission so that we know what we are talking about and why we are insisting that the Shipping Act govern and police the operation of rigs offshore. Most people believe that the Ocean Ranger went down with 84 men, that no on really got off the rig. They believe we do not know what happened but that is not true, Mr. Speaker.
A supply vessel called the Seaforth Highlander at 2.32 o'clock a.m. on February 15, 1982, reported a lifeboat to be alongside. Inside the lifeboat lights were on and men who had got off the Ocean Ranger could be seen moving about. Some of the men were bailing through the port and starboard sides. The sound of the seas and wind made voice communication between the lifeboat and the seamen on the after deck impossible. On the after deck a seaman attempted to throw a Samson rope to the lifeboat but it was blown away from its target. He then threw a line with a life ring attached to a man
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in the aft hatch of the small capsulized lifeboat. The man, clinging for his life, caught the line and attached it to the canopy of the lifeboat. He tied the other end of the line to the cat rail on the port side of the Seaforth Highlander, the supply vessel.
When this was happening, seven or eight of the men in the lifeboat emerged into the port gunwell. These men were wearing hard hats and work vests or life preservers. Some were lightly clad and others wore heavier clothing. The lifeboat began to roll slowly to port away from the Seaforth Highlander and within seconds it capsized, throwing the men who had been standing on the port gunwale into the sea and snapping the lines which had attached to the Seaforth Highlander.
As the men from the lifeboat spilled into the sea, the water in the immediate area was illuminated by the lights attached to the life preservers. The lifeboat had completely capsized. The time was 2.38 o'clock a.m.
That is what we are talking about, Mr. Speaker. We are not talking about the bureaucracy. We are not talking about red tape. We are talking about the lives of people who go to sea.
We are talking about the lives of men who managed to escape that floating coffin on February 15, 1982, the Ocean Ranger, the men who managed to get into the capsulized raft but who were unable to be rescued. Why? The report goes on to tell us that the supply boat, despite the courage and determination of the men on it, was ill equipped to bring a capsule alongside. It was ill equipped to provide any assistance. Even though they had a line on that capsule which had men in it, alive, it was not able to rescue those men.
The report recommended as well that the Government, through the Canada Shipping Act, provide regulations for the construction and operation of those supply vessels. That is not contained in the Minister's legislation, Bill C-75. I therefore say to the Minister who tells us that he will make further changes next fall, I absolutely guarantee to the Minister that if he will make the appropriate changes as recommended by the royal commission now, he will have no trouble as far as this Party is concerned, the Liberal Party, in having this legislation moved quickly and speedily through the House of Commons.
I know that every Member of Parliament, no matter on what side of this House he sits and no matter what Party he represents, feels exactly as I do and as strongly as I do. Offshore exploration is an area which is still relatively new but it is an area where we have Canadian men and women putting their lives at risk in order to harness that resource from the sea in the most dramatic and difficult conditions in the word. We want to ensure that every possible action is taken by the Government of Canada to guarantee the health and safety of our people. I know, and the people who work the rig know, that there is no fail safe system. They go to sea in those kinds of weather conditions, doing that kind of work, putting life and limb at risk. They know that no one can give them guarantees. But surely to God, Mr. Speaker, we can give them the very best facilities, regulations and equipment that money, technology and political will can provide. That is what we ask of the Minister today.

October 15, 1985
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We ask the Minister to go further than he has and we tell him that if he is prepared to go further, this legislation will receive speedy approval from the Official Opposition in this House and that this Minister will be applauded, I know he has some difficulty. I know there is some bureaucratic in-fighting and there is some difficulty with the Department of Energy, Mines and Resources, in particular, COGLA, which believes its regulations apply when a rig is operating at sea. However, we are not going to let bureaucratic in-fighting or empire building stand in the way of our responsibility to those citizens who make their living from the sea.
There is another measure contained in this Act which I would like to address. Section 4, charges relating to navigational services, has already been mentioned by the Hon. Member for Gander-Twillingate (Mr. Baker) and I know by other Hon. Members who have spoken on Bill C-75. You would need to have more nerve than a bad toothache to include that particular section in Bill C-75 at this time. More nerve than a toothache, Mr. Speaker. This is incredible. The Canadian shipping industry at this moment is in deep trouble and on its back. We already have one major company being operated by a bank, and the Minister knows it. We have one or two more which, before this year is out, are liable to join their crippled friend in being operated by a bank or receiver as well. Yet the Minister includes in this legislation a measure to impose on that industry what is, I submit, an unreasonable hardship. This at a time when you have a ship in the Welland Canal looking like the Conservative Party, frozen in suspended animation; unable to move forward, backward or sideways. This at a time when the credibility of the St. Lawrence Seaway is seriously endangered. For two years in a row the system has broken down because preventative maintenance is not being done.


Donald Frank Mazankowski: Because of Liberal neglect! Why don't
you say it?


Brian Vincent Tobin: Because preventative maintenance is not being done because you are trying to balance the books-


Donald Frank Mazankowski: Boy, have you got a lot of nerve.


Brian Vincent Tobin: -in a way that bites off your nose to spite your face. The Minister knows that if he drives a car year in and year out and does not take it in and do at least the normal maintenance, rotate the tires, check the brakes and change the oil, that car is going to break down. Yet another car, properly maintained, tires rotated, oil changed regularly, will run for a heck of a long time. We were providing good constructive maintenance on the St. Lawrence Seaway when we were in power but this Government is trying to drive the Authority right to the wall. The Authority has a $30 million surplus. That is not well-known because all you ever hear is that the Authority will have an $11 million deficit this year. The Government does not know whether it is going to bail the Seaway out. The Government will not let the Authority have
access to the $30 million it built up in surplus, either to pay off its debt or do preventative maintenance. That is the problem.
The Seaway saves Canadian farmers $10 per tonne compared to what it would cost to move grain by other methods. It is estimated that in the 26 years the Seaway has been in place, it has saved grain farmers a total of 2 billion. That Seaway is absolutely incredibly important for farmers, iron ore mines, those who are left, not having been shut down during the tenure of the current Prime Minister (Mr. Mulroney). It is important to people at Stelco producing steel. Yet this Government treats it as if it were an old bus. It has aged a little bit and it is letting it run itself into the ground. This is the exact same approach being taken with the Newfoundland Railway. The Government does not have the political courage to say that it wants to scrap the railway in Newfoundland so it is taking away maintenance dollars and letting it run itself into the ground. Eventually it will tell Newfoundlanders that it is run down, no good and let's close it down. Well, if the Government is not careful that is exactly the kind of situation we will find on the St. Lawrence Seaway. I know my friend from the NDP has raised this matter a number of times during the last few weeks and he is absolutely correct. The Government is being penny-wise and pound-folish.
I simply want to say again to the Minister, having spent $15 million over a couple of years in order to come up with the most intensive and exhaustive examination of conditions affecting the operation of rigs in the offshore, having made specific recommendations to the Minister, and despite the bureaucratic difficulties he has, despite the in-fighting which may occur among bureaucrats because the Minister is certainly not a man who would be distracted from doing the right thing because of bureaucratic in-fighting, would he not please reconsider and stand in his place and provide us with amendments which would reflect the spirit of the recommendations made by the royal commission on the Ocean Ranger marine disaster? Will he not do that? If he does, I can assure him that we in the Liberal Party, and I would not be surprised if the same applies to the other Party represented in this House, will do everything in our power to see that this Bill receives the speedy passage it deserves. That is always providing that we have made up our minds here that Canada should use all her technology and whatever of her wealth is necessary to give those people at sea in hazardous conditions every possible chance at survival.


J. Michael Forrestall: Mr. Speaker, as someone who has a son on one of those rigs, I assure the Hon. Member that he does not have a corner on concern for these people. It is shared by all of us from our part of the country. I want to direct my comments, because the Hon. Member's observations are important, to advise the House of where we stand, in part, on the recommendations of Mr. Justice Hickman. As has been indicated, the first phase of the report was tabled in August of 1984 and it contained 66 recommendations directed at Government and industry. They dealt with drilling rig design, evacuation systems, certification and training of crew, search and rescue, among others. Some 80 per cent of those recommendations are
October 15, 1985

either fully or partially implemented. The remaining 20 per cent require legislative authority to implement. That is what this process is all about. The recommendations contained in the more detailed report, some three volumes, require legislative change or Government-industry agreement after very close consultation.
The Hon. Member and others have said that this Bill does not address the Ocean Ranger report. In Bill C-75 we are dealing with safety at sea, standards of training and certification of seafarers, and we are dealing with greater capacity for the Board of Steamship Inspections to assure themselves and the Canadian public of the safety of the rigs. We deal with construction and equipment. We require the implementation of certain conventions and codes, some of which have been hanging around since 1969. That is about 15 or 16 years ago. For the edification of the House, these include the 1969 International Convention on Tonnage and Measurement of Ships. The International Convention on Standards of Training, the certification of watchkeeping certificate for seafarers; and the 1978 protocol to the 1974 International Convention of Safety of Life at Sea. Then we have the 1975 International Convention for the Prevention of Pollution and the 1958 Seafarers' Identity Document Convention. We have also included the 1969 International Convention on Civil Liability for Oil Pollution Damage and the 1971 International Convention on the Establishment of the Fund for Compensation of Oil Pollution Damage. Among the codes that are even more pertinent are the code for the construction of equipment of ships carrying liquefied gases in bulk, the code for existing ships carrying liquefied gases other than in bulk, the code for the construction and equipment of ships carrying dangerous chemicals, and the code for the construction and equipment of mobile off-shore drilling units, the very thing which must be ratified before Canada can implement the regulations.
I ask the Hon. Member where in this Bill, if he has read it, he got the impression that Bill C-75 is not attempting to address the very real concerns which he raised, almost blatantly, and, I suggest, with perhaps not as much regard as he should have for the families of those who have been lost.


Brian Vincent Tobin: Mr. Speaker, I am surprised at the last words of the Member opposite. I hope he will stand in his place and apologize for them.


J. Michael Forrestall: Oh, come on.


Brian Vincent Tobin: I am serious. I pointed out at the beginning of my remarks that no Member of this House had a monopoly on concern for people off-shore. I have stated repeatedly-and I wish the Member would read the "blues"-that every Member has a concern-


J. Michael Forrestall: Stop trading on their misfortune.


Brian Vincent Tobin: I have to tell you, sir-
Canada Shipping Act


J. Michael Forrestall: You are trading on their misfortune and you should be ashamed.


Brian Vincent Tobin: The comments that the Hon. Member has just made are not worthy of his reponsibility as a Member of Parliament and are certainly not worthy of his responsibility as a Parliamentary Secretary to the Minister of Transport. I will also say that they are not worthy of an honourable man. 1 will say no more, Mr. Speaker. When I speak in this House on the Ocean Ranger and the Ocean Ranger disaster, 1 speak as a Member of Parliament from Newfoundland who is concerned about all 84 people who went down on that rig. There were two people from my riding who went down on that rig and I do not want my sincerity questioned by any Member.


J. Michael Forrestall: You are trading on it and you know it.


The Acting Speaker (Mr. Paproski):: Order, please. 1 appreciate the comments being made and the exchange which is taking place. We are touching on a very serious incident which happened and I hope that Hon. Members on both sides will cool it, shall I say, and let us get on with the debate.


Brian Vincent Tobin: Mr. Speaker, if this is not the place to talk about it, I don't know what is. The Hon. Member says that 80 per cent of the recommendations have been implemented or partially implemented. I congratulate the Government, as 1 have in the past, for implementing those recommendations which it has. However, some of the so-called partially implemented recommendations are very much partial. The Government says that it has met a recommendation that a helicopter base be established in St. John's by temporarily stationing a helicopter from time to time in St. John's. That is not the recommendation of the commission on the Ocean Ranger. That recommendation has not been met as the Government claims it has.
I would like to see a report card from the royal commission which would tell us how many of these so-called recommendations the Government believes it has met have indeed been met, in the minds of the Ocean Ranger commissioners. The commission said that there ought to be a full-time helicopter facility established in St. John's. The Government says that it has met that recommendation by moving a helicopter from Gander into St. John's from time to time. That is not meeting the recommendation of the royal commission. The Parliamentary Secretary, the Minister, and the Member for St. John's West (Mr. Crosbie) know that. The Member is very knowledgeable about this matter. He knows that everyone in Newfoundland knows it.
People are questioning the very nature and type of the helicopter which is currently being used. People are questioning whether this vehicle is proper and sufficient for use in off-shore weather and icing conditions. We are still using those same helicopters with no publicly expressed intention to replace them with more modern and efficient aircraft. That indicates that the spirit of the recommendations are not being met. The means for getting off the rig when it is listing or in a stormy sea is a couple of slings which drop a capsule over the side. That is the same means which was in place on February

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15, 1982. That indicates that the spirit of the recommendations have not been met.
That is all I am saying, Mr. Speaker. It has nothing to do with partisan politics. It has to do with doing the best we can by using the technology that is available in this country and the money that is available to the Government to make the best possible system. I have said that no system can guarantee the safety of anyone on a rig but, by God, we should do our best. If the Parliamentary Secretary wants to call into question anyone's sincerity in raising this matter in the House, then he is out of touch. I give him the opportunity to apologize for that comment. I would not accuse any Member-


J. Michael Forrestall: You just did.


Brian Vincent Tobin: I would not accuse any Member-


The Acting Speaker (Mr. Paproski):: Order, please.


Brian Vincent Tobin: -in a natural disaster of this kind-


J. Michael Forrestall: You're trading on the misery of those families and you know it.


The Acting Speaker (Mr. Paproski):: Order, please. The period for questions and comments is now terminated. I would like to recognize the Hon. Minister of Justice (Mr. Crosbie).


John Carnell Crosbie: Mr. Speaker, I was not planning to get involved in this particular debate, but since the matter of the Ocean Ranger has come up I thought that I would speak about it for a few moments because I am taking an obvious interest in ensuring that the recommendations with regard to the Ocean Ranger are implemented in so far as they can be. The final report of the commission on the Ocean Ranger which was headed by Chief Justice Hickman of Newfoundland was only received in July if my memory serves me right. That report is now under intense scrutiny by various departments of the Government, including the Department of Transport, in order to decide how many of the recommendations can be effected. Since I am a Member from Newfoundland I am taking a particular interest in that period.
As a matter of fact, Mr. Speaker, I met last Friday with the chairman of the committee of officials which is dealing with the report. The legislation which is now before the House deals with revisions and changes to the Canada Shipping Act. As we all know, it is not, nor will it be, the only legislation which applies to Canada's off-shore areas. I would like to assure the Members of this House, and through this House anyone who might be watching or interested from Newfoundland and Labrador, that the recommendations of the Ocean Ranger commission are going to be implemented wherever possible and wherever the Government considers that these recommendations would bring about improvement which are possible and can reasonably be made in connection with off-shore safety of Canada. The Government will certainly make clear its position on each recommendation which it feels it cannot or should not accept and on each recommendation which will only be partially accepted or partially implemented. Nothing less would be satisfactory.
I am pleased that the hon. gentleman has brought up this subject as it is a most important one. I know that some of his rhetoric is just that. He likes to expound with some vigour and as a young MP he is coming along. He is certainly able to fill this Chamber with the rotundities of his views, if that is the right wording.


Lorne Edmund Nystrom: The new John Crosbie.


John Carnell Crosbie: Being in Opposition, he can now do that and exercise himself with considerable indignation whereas in former times he had to remain silent. One can understand that he is somewhat like the steam kettle that has been on the boil all day with a wooden plug in the bung-hole. Having come from Government and into Opposition of course the bung-hole has sprung and all the steam is pushing out. We welcome it. Of course, often the hon. gentleman does not make more sense than a bung-hole.


Lorne Edmund Nystrom: What hole?


John Carnell Crosbie: Bung-hole. It is a kind of hole that you would not understand, coming from Saskatchewan.
Returning to the point, I would ask the hon. gentleman to remember that when the Ocean Ranger tragedy occurred in 1982, it occurred when our predecessor Government had been in power for some 20 years. It is obvious from the circumstances that surrounded that incident, certainly as later found by the royal commission, that some peculiar situations had been allowed to develop about which people had not been made aware. Most of this has been clearly pointed out in the report of the Ocean Ranger. Hopefully it is not a situation that will ever occur again but we have to be vigilant to make sure that it does not occur again.
The Ocean Ranger commission consisted of six members. As I recall, three were nominated by the Government of Newfoundland and Labrador and three were nominated by the Government of Canada. Both Governments jointly shared the expenses of that commission. However, this is primarily within the jurisdiction of the Government of Canada and it has a responsibility to see that these recommendations are carried out except where a conclusion is reached that a recommendation is not the right one.
In addition to the fact that the legislation and regulations that pertained in 1982, at the time of this occurrence, were regulations that were implemented under a legislative regime for which the hon. gentlemen opposite had been responsible for some 20 years, I would point out that there have been considerable improvements brought about in the situation since this Government assumed office. The Hon. Member mentioned one of those improvements but only did so to denigrate it. It is the stationing of National Defence search and rescue helicopters in St. John's during the winter period, which is the period of
October 15, 1985

greatest danger for offshore operations. That commenced last year under the aegis of this Government.
For years, when we were in opposition in the House, our protests and cries that the search and rescue facilities in Newfoundland were inadequate were completely ignored by the Government of the day, which is the Government to which the Hon. Member belonged. There have already been considerable improvements brought about in search and rescue for the offshore just through the stationing of helicopters in the St. John's area in the winter-time. They are not in Gander or Prince Edward Island or Halifax or some areas where it will take them hours to get to the scene of the trouble, if trouble occurs. Although more improvement is needed, there has already been a great deal of improvement in that direction. Better equipped helicopters, reflecting the latest state-of-the-art technology, are needed in this location, certainly during the winter period but preferably all year.
I do not intend to make a lengthy intervention here today, except to say that the Minister of Transport (Mr. Mazankow-ski) is well aware of these problems. He has done more in his few short months as Minister of Transport to overcome transportation problems in Newfoundland and elsewhere than any other in our history. He only had eight months in his last reincarnation. He has had 13 months so far, this time. He is well aware of the problems and well aware, as far as his jurisdiction is concerned, of what must be done to overcome these problems. As long as we have a person of his calibre and interest occupying this position, we do not need to worry about what will happen to the Ocean Ranger report. That report will be implemented and any aspects of it that the Government concludes are not suitable for recommendation will certainly be made public.


Brian Vincent Tobin: Mr. Speaker, I have a comment and then a question. First, let me say that I agree with the Member for St. John's West (Mr. Crosbie) that the Minister of Transport is indeed a man unusually possessed with a high degree of intelligence, ability, wisdom and knowledge in this industry. 1 think he is a man of integrity. I do not question that. It is because I believe he has those qualities that I appeal to him to move more quickly and not wait until next fall with respect to the recommendations contained within the Ocean Ranger report.
Let me say with respect to the Member for St. John's West, that I agree with just about everything he said with the exception of his comments about the bung-hole. Even though 1 agree with everything he said, I tremble somewhat in fear because I am expecting a retraction to be issued at any moment. I do not know if he cleared those comments with the PMO First.
The Hon. Member said that conditions were not as good as they should have been in 1982 when the previous Government was in power. He is right. They were not. If the Hon. Member checks the record in Hansard for 1982 and 1983, or checks the public record as far as press clippings are concerned in Newfoundland, he will find that that is exactly what I was saying as a Member of the Government about the provisions made by
Canada Shipping Act
the Government in 1982 and 1983. They were not good enough.
I recall that one of the most disturbing incidents at that time was that two levels of Government were having a political fight about safety regulations while the rigs were operating. One Government threatened to close down the drilling season while the federal Government said it would not allow that to be done. It was a political football that was being kicked back and forth in a very partisan way. If the Hon. Member checks the record, he will see that I was asking at that time for an interim report from the royal commission. In fact, I asked questions in the House of the Minister of Transport as well as in public through the press for an interim report so that we could resolve at least some question of safety rather than let the matter become nothing but a political football.
If the Hon. Member for St. John's West is consistent he will check the record and find that out. The fact of the matter is that we did not have a report in 1982 or 1983. However, since August, 1984, we have had the most exhaustive report of a royal commission. The fact that it was not available before is not an excuse for the past. It does not forgive inaction by Governments of any stripe, including Liberal, if there was inaction in past years. However, we never had a report.
The fact that we have that report now is why I ask the Minister of Transport to take this opportunity to encompass within Bill C-75 the recommendations of the royal commission, particularly as it affects his jurisdiction under the Canada Shipping Act to police the operation of these rigs when they are stationary and at sea.
I ask the Member for St. John's West, in good faith, if he is satisfied that the temporary stationing of the helicopter from Gander meets the specific recommendation of the royal commission. Is he satisfied with that as the Member for St. John's West and, more important, as a Newfoundland Cabinet Minister?
Second, will he tell us whether any initiative is under way by the Government to examine what new types of equipment with respect to SAR helicopters might be more appropriate for this kind of offshore duty than the aircraft that is currently being used? There is wide ranging debate as to whether or not this current vehicle is appropraite for the conditions offshore.


John Carnell Crosbie: Mr. Speaker, I do not know about retractions. I never recall having retracted anything that 1 have said, not even in recent days. Therefore, I am not familiar at all with retractions. I do not know what the Hon. Member is referring to in that respect.
Perhaps the hon. gentleman was being accurate. I will have to accept his word for it if he says that in 1982 and 1983 he went on the record as to the need for improvements in offshore search and rescue capabilities and other needs in Newfoundland.
I also remember that he was aiding and abetting the then Minister of Energy, Mines and Resources, who is now the External Affairs critic for the Official Opposition, in his efforts to crush the province and force it to submit to the

October 15, 1985
Canada Shipping Act
Government of Canada and accept what it was offering the Province of Newfoundland by way of an oil and gas agreement at that time. Of course that agreement was one which would have put complete authority and control over all offshore activities into the hands of the Government of Canada.
I well remember when the Ocean Ranger tragedy occurred the disgraceful appearance of the Government of Canada attempting to prevent the Government of Newfoundland from appointing a commission of inquiry to look into the matter and trying to beat it to the punch by appointing its own commission. I remember well the unsavoury fracas which occurred until wiser heads persuaded the Government of Canada to pay some attention to the province, to do the decent thing and to appoint a commission which would have representatives of both Governments. That is the kind of thing I remember. The then Government of Canada did not care much about what was happening in the offshore insofar as safety or the conduct of the offshore was concerned. It was interested in who would control it, who would have the power, how it could best crush Newfoundland and Labrador, and how it could prevent another Alberta from arising on the East Coast of Canada, as it visualized it. That was its concern at that time, not helicopters or equipment on helicopters-


Brian Vincent Tobin: On a point of order-


The Acting Speaker (Mr. Paproski):: The Hon. Member can rise on a point of order, a supplementary question or a comment.


Brian Vincent Tobin: Mr. Speaker, I put the same two questions to the Hon. Minister again. Obviously he is using partisan rhetoric to try to avoid my questions. My question was twofold. Is the Hon. Member for St. John's West (Mr. Crosbie) satisfied-


John Carnell Crosbie: That is not a point of order.


The Acting Speaker (Mr. Paproski):: Order, please. It is not a point of order, but the Hon. Member wants to direct a supplementary question to the Minister. Is the Minister finished?


John Carnell Crosbie: Could I answer his original question?


Brian Vincent Tobin: There are two questions; answer them.


John Carnell Crosbie: Mr. Speaker, I could either ignore answering his supplementary questions or ignore answering his original questions. I choose, at the moment, to ignore answering his original questions. I will ignore his supplementary questions later.


Brian Vincent Tobin: Why are you afraid to answer them?


John Carnell Crosbie: Mr. Speaker, I was interrupted-


Brian Vincent Tobin: Answer them.


John Carnell Crosbie: The Hon. Member claims to have asked a question. What I heard was a harangue, followed perhaps by a question.


Brian Vincent Tobin: Hansard will record my original two questions, and Hansard will record that you are afraid to answer them.


John Carnell Crosbie: The hon. gentleman is irrepressible in the venting which he wants to do through his bung-hole at this particular moment. With respect to the question of helicopters, I believe, as I said in my earlier remarks, that we should have state of the art helicopters with the latest in search and rescue techniques and equipment stationed in St. John's, Newfoundland, in order to provide maximum search and rescue capabilities and safety features, particularly during the winter season. That is what is required. The Government of Canada is looking at all options and how they can best be accomplished.
We are looking at the recommendations of the Ocean Ranger commission. Some of them would involve quite massive changes and, therefore, decisions could not be made overnight. For example, there was a recommendation that the search and rescue work should be conducted by a new, independent agency, not by a Department of Government which has other responsibilities, such as DND. That would be a very considerable change involving some intricate questions as to whether all the equipment of such an agency would be dedicated for that one purpose, how it would affect present arrangements and the like. All these matters are under intensive scrutiny now, and certainly that will be decided within the next several months; three or four months at the latest. Other matters which are not quite that intricate or where the involvement of Government in the changes would not be so massive will be decided much quicker. I know that the Minister of Energy, and the Minister responsible in Newfoundland will be giving a report this fall on just what has happened to all these recommendations to date.
I have forgotten the second question, but just to answer-


Brian Vincent Tobin: Are you satisfied with temporary placement in St. John's?


John Carnell Crosbie: That is an improvement over the condition which applied beforehand.


Brian Vincent Tobin: Yes, it is.


John Carnell Crosbie: However, I could not say that I was satisfied with just that. I would like to see the new arrangements made permanent and better equipment used. That is what we have to work toward.


Nelson Andrew Riis: Mr. Speaker, I do not plan to say too much, so that this Bill can proceed. However, I have a few comments to make regarding Bill C-75. My concerns focus around 16 items in the Bill. 1 will start by going through them one at a time.
The first one primarily concerns the suggestion or implication that user fees will be applied to commercial shipping. Most likely this is where costs will be imposed on the grandest
October 15, 1985

scale. As a western Canadian Member of Parliament, 1 am concerned about added costs to central Canada in potential coal contracts with Alberta and British Columbia. Mr. Speaker, I know you are familiar with the study by the Alberta and Ontario joint task force on coal, being a Member from the fine Province of Alberta. The task force shed a great deal of light on Seaway transportation costs, particularly as they impact upon the matter of coal.
In 1978, in my own province, the Byron Creek collieries started looking at the exportation of coal from British Columbia to central Canada, to be used primarily by power facilities in Ontario. Aside from it being a Canadian product producing jobs in western Canada, not to mention the jobs which would be created throughout the transportation system, western coal is of particular interest because of the role it plays in acid rain and the fact that its sulphur content is so much lower than that coming from the United States of America. It has a significant role to play in the future, particularly with Ontario Hydro generating stations. Like many of our problems in Canada, our unfortunate fluke of geography results in it being a considerable distance from market. That is the essence of my first concern. The imposition of additional commercial shipping fees put the possibility of a western Canadian coal link with central Canadian demands simply that much further into the future. For example, a cost-quality comparison indicates that in Canadian dollars per tonne, the maritime transportation component shows an average cost of $2 per tonne for American coal compared with $7 per tonne for Canadian coal. Obviously any increase in Seaway tolls for indirectly or directly related Coast Guard services will only make the gap between the cost of American coal and the cost of Canadian coal larger and therefore reduce the competitiveness of western Canadian coal. Hon. Members from western Canada have repeatedly raised this matter as something into which the Minister of Transport (Mr. Mazankowski) should look very seriously, in terms of keeping costs to a minimum to facilitate the exportation of western coal into central Canada. If currently contracted Hydro Ontario purchases are any indication, western Canadian coal could increase to 50 per cent or 55 per cent of Hydro's total coal supply by 1990. The opportunities for increased sales of western Canadian coal to Ontario Hydro will of course depend upon the availability of a competitive product.
The fact that western Canadian coal is of low sulphur content ought to be a factor in encouraging the Government to consider some subsidies in respect of the transportating of that coal from western Canada into the Central Canadian basin-


The Acting Speaker (Mr. Paproski):: Order, please. The Hon. Member, on Bill C-75, will have 15 minutes for his speech, plus 10 minutes for questions and comments, when the Bill next comes up in the House.
Octane Enhancers

It being five o'clock, the House will now proceed with the consideration of Private Members' Business as listed on today's Order Paper.


PRIVATE MEMBERS' BUSINESS-MOTIONS   ENERGY ADVISABILITY OF PRODUCTION AND DISTRIBUTION OF OCTANE ENHANCERS
Mr. Elliott Hardey (Kent) moved:: That, the Standing Committee on National Resources and Public Works be empowered to study the feasibility of recommending the production and distribution for sale to the motoring public of Canada, through its Crown agency, Petro-Canada, gasoline blended with the octane enhancers ethanol (3 per cent) and methanol (5 per cent) for the purposes of:
1.	removing the additive of lead concentrates and MMT (Methylycylopentadienyl Mangenese Tricarbonyl) from currently-marketed gasolines;
2.	creating an expanding market for Canada-grown corn;
3.	utilizing the existing sources and known reserves of natural gas; and
4.	reducing the importation of light crude oil products currently used in
gasoline production.
He said: Mr. Speaker, this motion proposes a government initiative of far-reaching importance to Canadians and one which would result in extensive economic and environmental benefits both in the short and long terms, providing the type of stimulus that can only come from a major national staple industry.
Energy and environmental issues are of paramount importance to the world community, of which Canada is a part. These issues touch each part of our land in such a way that individual national interests are inseparable from mankind's global interests. Each day we become more and more committed to the development and discovery of energy sources to meet the needs of our nation's growing population. These needs represent an important part of the progressive lifestyle of our citizens, and the lifestyle of our citizens reflects the well-being of Canada.
At the same time, we are equally committed to a national and international program to clean up, maintain and protect our environment. The proper and controlled uses of energy sources are recognized as essential to any environmental protection efforts.
Our principal environmental pollutants, particularly those released into the atmosphere, emanate from energy sources used by industry and in transportation. And, of course, today we are dealing with the pollution problems arising from transportation.
We all know how seriously the federal and provincial Governments of Canada view the environmental clean-up pro-

October ] 5, 1985
Octane Enhancers
gram. The recent conference on acid rain held in Minett, Ontario, certainly demonstrated these concerns in a most impressive way. 1 think this is one of the most important issues of our time and our generation. It is we who must solve the environmental pollution problems, while there is still time.
As simple as it may sound, it is the combustion engine that is the major problem resulting in pollutants in our atmosphere. The constant release of vast quantities of nitrous oxides into the atmosphere over extensive regions of the globe has brought us to the critical juncture where we have no choice but to take drastic steps to control air pollution. Over the last several years, there has been a major effort to reduce the lead content in gasolines, both in Canada and the United States, as a major part of this clean-up thrust.
In the United States the Environmental Protection Agency has been the leader in these efforts, even to the point of promoting what are called "lead credits'; that is, federal subsidies to petroleum producers for taking the lead out of their products. It is a program that has been largely successful. Lead as an octane enhancer has been on the way out for the last three years, and with it the injurious effects on the environment and on people. We in Canada have been a little slower in the move to phase out lead in gasoline, but there is a move in that direction.
What about the so-called "lead-free" gasolines? In Canada, lead-free gas is known as MMT, a manganese compound, Mr. Speaker, which is another heavy metal. It is added to gasoline as an octane enhancer. While MMT has a high octane rating, it is highly flammable and can cause irritation to the skin and eyes. High concentrations of it can cause headaches, dizziness, and even unconsciousness.
MMT vapours are known to travel considerable distances to ignition sources and cause a flashback. The hazards of MMT to people and to the environment are therefore obvious. In the United States, MMT has been effectively prohibited since 1977 because of federal regulations which only permit a quantity of 0.0685 grams per gallon to be used in any gasoline blend. MMT is also prohibited in Europe. So, it has to go also in Canada, and as soon as possible.
The removal of lead and of MMT from gasoline as octane enhancers leads naturally to the question of their replacement. Where do we go to find a replacement source? What are the global aspects, economically, of such a possible replacement? My motion answers these questions. When Canada meets U.S. and, indeed, world standards for lead and MMT concentrations, something else must supply the needed octane enhancement. Clean-burning alcohols are ideally suited for this purpose. My motion proposes the federally-sponsored production of an ethanol-methanol blended gasoline for Canada, known as EM gasoline.
A blend of 92 per cent gasoline, 5 per cent methanol and 3 per cent ethanol creates a satisfactory octane requirement. Again, that is a blend of 92 per cent gasoline, 5 per cent methanol-sometimes known as wood alcohol-and 3 per cent ethanol-and that is the happy stuff, Mr. Speaker. The combination of the alcohols making up 8 per cent of the fuel
will cost no more than the gasoline it replaces, and maybe less, and these alcohols will not damage the environment.
Both methanol and ethanol are home-grown products. Methanol is derived from methane, or natural gas, of which Canada has an abundant supply, and ethanol is a renewable fuel alcohol produced from grains, particularly grain corn, though it can also be produced from cull potatoes, from the east, or forestry by-products in the West.
Let us get right into the cost factors of this EM concept of octane enhancement. The idea of alcohol for this purpose has been around for a number of years, usually in the form of a straight 10 per cent ethanol blend with gasoline, which is known as gasohol, a product used commonly in the United States. It has gained the reputation of being unable to quite compete with petroleum-based fuels, but in Canada, we have natural gas and lots of it. With it we can produce methanol for nearly one-half the cost of gasoline. It can be produced at 16 cents to 18 cents per litre while the cost of producing gasoline is about 31 cents per litre. Methanol is the key to introducing clean-burning, affordable alcohols into our gasoline blends.
There are three modern western plants already producing methanol. One such plant is Alberta Gas Chemical Co. at Medicine Hat, Alberta. The two others are Canadian Celanese in Edmonton and Kitimat, British Columbia. These factories were built during the heyday of export markets. Presently, the domestic market is quite small. 1 am told by reliable sources that if these plants were put into high gear, they could produce enough methanol for all the gasoline blend requirements in Canada. No megaprojects need be considered, just efficient, job-creating, production increases with natural gas as a source.
I am sure Hon. Members are asking themselves at this point why we need ethanol if methanol can be produced far cheaper. Today's cost of producing ethanol is, I believe, about 50 cents per litre. Methanol requires a co-solvent to keep it properly mixed in gasoline, particularly in cold wheather. Ethanol is a co-solvent that will do the job. There are other co-solvents such as isobutyl alcohol and isopropanol, both derived from petrochemical feed stock. However, ethanol comes from a renewable source and it is now unmistakably clear that the price of petroleum and petrochemical products, regardless of technological advances in the field, can only go in one direction and that is up.
Since 1977, petrochemical products have shown a continuous price increase and it is the opinion of the economists, based on long-term supply and demand stituations, that the cost of petrochemical resources versus renewable resources will meet at a certain point. 1 have a graph which shows absolutely and inevitably that the costs will meet and even forecasts the meeting point to occur some time in 1991. Right now, though, ethanol does cost more to produce than gasoline.
The success story of gasohol in the U.S., where five billion U.S. gallons of blended gasoline consisting of 10 per cent ethanol and 90 per cent gasoline are sold annually, means that its production is supported by federal and state incentives. This
October 15, 1985

tax is justified by the tremendous boost to agriculture it provides, particularly to corn producers in Nebraska, Iowa, Illinois and Ohio. If fuel ethanol is to be used or developed in Canada, it will be with a blend of ethanol and low-cost methanol, known as EM fuel. This would require no subsidy by the taxpayer. We would simply tap into our abundant supply of natural gas. The 8 per cent portion of the combined ethanol and methanol in a litre of blended gasoline would cost 2.40 cents. The gasoline it would replace would cost 2.48 cents. The alcohol mixture is cheaper than the gasoline it replaces. It should be emphasized that no changes will be needed in automobiles for them to use EM gas and that all warranties would cover the use of EM fuels.
Companies like St. Lawrence Reactors Ltd. and Commercial Alcohol Ltd. in Montreal which are presently producing ethanol are eagerly working on technology in conjunction with the Canadian Renewable Fuels Association. They are ready to construct new plants as soon as a market appears to be forming. Again, no megaprojects will be required. Plants will simply appear where renewable resources are available. Representatives of these companies are telling me that they expect to significantly reduce the cost of producing ethanol in the future. However, the cost of EM fuel to which l just referred is based on today's prices, and even these figures indicate a favourable cost structure.
What does EM fuel mean? It means a cleaner environment and an opportunity for Canada to match U.S. gasoline standards for lead and MMT. This will surely strengthen Canadian credibility in discussions on acid rain and other environmental issues. That alone should be enough to put this motion before a committee. Further, the utilization of Canadian-produced renewable fuel source will involve the use of Ontario corn plus other agricultural and forestry by-products.
I come from Ontario, and there we think of corn as being a renewable source for ethanol. The production of 350 million litres of fuel ethanol in Ontario would require about 35 million bushels of corn. That corresponds to the average offshore sales of corn in recent years. As well, wet mill processing of corn yields corn gluten meal which is 60 per cent protein and highly prized in the poultry industry as well as corn gluten feed which is 21 per cent protein and used in the cattle industry.
Consider the potential for job creation, Mr. Speaker. Unlike petroleum refining which requires relatively few employees, grain handling and processing industries are more labour intensive. Expanded ethanol production would create literally thousands of jobs.
Finally, while Canada is again a net exporter of heavy crude oil, it is a significant importer of light crudes which are used for gasoline production. An 8 per cent reduction in the total Canadian requirement would have a major effect in reducing this import demand.
I ask my colleagues on all sides of the House to support this motion. There are only minimal adjustments to be addressed and once those are addressed we can stop using lead and MMT as an octane enhancer because the alternative can be
Octane Enhancers
readily available. We have a tremendous opportunity to capitalize on our Canadian resources. The time to move is now.


Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, I would like to thank the Hon. Member for Kent (Mr. Hardey) for bringing this motion before the House today. It is a very thought-provoking motion and one that has the potential to do a great deal not only for the consumers of this country but for the agricultural industry and the energy sector.
In looking at this question, I feel that the thought that must be uppermost in our minds is caution. There are many things we must consider when looking at the use of methanol and ethanol as octane enhancers in gasoline. This does not mean that we should not take a very serious look at the blend as an alternative fuel but we must use caution. I express concern mainly because methanol can cause problems such as vapour lock, layer separation and unusual wear on engine parts. That is not to say that these things cannot be overcome by thoughtful utilization and I believe this is going to be part of the interesting feature of studying this whole question. Although this is widely believed to happen only when methanol is used in heavy doses, the fact is that a vehicle's fuel system can be harmed and that is the main reason the automobile industry has had some hesitation in using this product widely. Also, Mr. Speaker, and more importantly, the long term effects of its use are not known at the present time. We must be very careful when we are dealing with the health of the Canadian consumer. Even if this Government does forget this fact from time to time, as we have seen very recently, the health of Canadians must be uppermost in our minds.
The automobile industry has allowed to a maximum of 5 per cent the use of methanol, which is the amount we are discussing here. Although the use of this blend could remove the additive of lead concentrates and MMT, which, of course, would be of great benefit to the environment, there remains one important question. What are the long term effects of this blending on the Canadian environment? We could-and I hope you will forgive the pun, Mr. Speaker-be adding fuel to the fire with regard to putting harmful substances into the environment. We must also face the fact that removing MMT from gasoline would be the last thing the industry wants. MMT is easy and much cheaper as an octane additive. If there is a chance that methanol can harm car parts, not to mention people, we must ask ourselves if there is not another alternative. That is not to throw water on this very important question because I, as well as the Hon. Member for Kent see this as a very important alternative.
I am glad the Hon. Member brought this subject forward and his motion to present this to the Standing Committee on Natural Resources and Public Works will give us an opportunity to look at this question. I think we have to look at the facts and the present data which is available to us through RDC, Research and Development and Consulting Ltd. which shows that the blend of 5 per cent methanol and 3 per cent

October 15, 1985
Octane Enhancers
ethanol and 92 per cent gasoline lies within the satisfactory operating region for Reid vapour pressure or RVP. RVP is simply the vapour pressure of a fuel at 37.8 degree Celsius. It is used to measure the fuel volatility and, of course, fuel volatility must be controlled between suitable limits to provide proper operation in an internal combustion engine.
At the lower end, some volatility must be present to allow starting in cold temperatures and, at the upper end, too much volatility can cause vapour lock. I mentioned the problem with methanol when exposed to very high temperatures.
The Canadian General Standards Board allows for three levels of RVP, a summer grade, a winter grade and an intermediate grade. Through studies on this particular gasoline blend, it was found that this blend would have the vapour pressure and volatility characteristics suitable for the area of western Ontario. The study suggeted that motorists using this fuel would not experience vapour lock problems.
What about the other areas of our country, Mr. Speaker? Winters can get very cold in some parts of this country. Another problem with this blend of gasoline is drivability during warm up. I know that anyone who has had the distinct pleasure of sitting in a cold car waiting for it to warm up would find that an annoying problem.
These may be simple questions which have no bearing on the ultimate need to change to a blend such as this, but once again these are questions which are worth studying and worth answering because they are questions, Mr. Speaker, which are going to be asked of us who will be debating this very important issue.
The fact that this blend consumes less energy per mile is very significant. It does help to reduce our need for imported light crude oil products, and after the OPEC shocks to the western world, that is a very welcome option. Canada does have huge reserves of feed stocks from which methanol can be produced and it would create an expanding market for Canadian corn producers. With the situation in the agricultural industry at the present time, I think it is very important to be able to provide a blend which would be suitable to the motorist, to the environment and would be helpful to the Canadian public, and at the same time, it would be of benefit to the agricultural industry, which is something that would be very attractive indeed.
We must also look, Mr. Speaker, at what this type of blend will do for the consumer. Bob Chislett of Sunoco, who has joined with Alberta Gas Chemical Ltd. in test-marketing the blended fuel says that the consumer benefit. I believe that is very significant. Mr. Chislett says that the higher octane rating can help stop engine knock and in winter can reduce gasline freeze-up. It also burns more cleanly, which of course reduces the emissions going into our atmosphere.
However, the consumer does not get any break with lower prices. The reason for this is not because of the blend so much as it depends upon the price at which it is offered to the Canadian public. If recent history repeats itself, there is a very great reluctance to reduce fuel oil prices. Of course, there is
also the high cost of the co-solvent which must be present in this blend and which at present comes from the United States.
The Ontario Government is waiving the tax on the methanol portion of the fuel, but the consumer will not feel it because of the increased cost in producing the blend. So there are many advantages to this blend of gasoline, advantages which we must consider, especially in view of the fact that lead additives are being phased down in our gasoline products from .77 grams per litre to .29 grams per litre by 1988. Therefore, we have no choice. We must find other octane enhancers, but in looking at those alternate fuels, we must also look at the history of the product. In 1976, the Canadian Society of Chemical Engineers and the Canadian Society of Mechanical Engineers concluded at a symposium that methanol may have better use as a replacement for liquefied petroleum gas in gas turbines. There would be fewer problems and application could be in areas such as electrical generation in rural communities for grain drying. We must look at their reservations, even though it was back in 1976. They were still reservations held by a very important and learned body.
We must be sure before we approve anything that our children will not regret our choice in future years. I must stress here, Mr. Speaker, that we must have an open mind in looking at this question, not because we do not see the benefits of what is before us today but because of the importance of the decision and because of the great utility of the product on which we would be passing judgment and which we would be analysing. If the effects were detrimental in any small fashion whatsoever, it could have serious consequences in the years ahead.
That is why, Mr. Speaker, I feel that the Standing Committee on Natural Resources and Public Works should have the opportunity to study the question more carefully, to invite members of the industry who are involved in the production of this blend and to hear from members of the auto industry who have some reservations about the blend, and of course, to hear experts on the environment.
We must realize that this blend of gasoline is widely used in other parts of the world, in West Germany, Brazil and in the United States. It is imperative that we look at what it means for Canada, and especially for the future health of Canadians.
I request, Mr. Speaker, as does the Hon. Member who presented this motion, that the question be referred to the Standing Committee in order that we can fully understand the implications and consequences of our decisions. We will then be in a better position to pass judgment and make a more informed decision about the use and possibilities of this very important fuel for our country.


The Acting Speaker (Mr. Paproski):: The Hon. Member for Regina East (Mr. de Jong) from a standing position.


Mr. Simon de Jong (Regina East):: Mr. Speaker, the doctors have put a cast on me and I am able to hop around and stand and face you and bow, Sir.
October 15, 1985

It is a pleasure to enter the debate on this private Members' resolution. I think it is a good one and the suggestion that it should go to committee makes a heck of a lot of sense. All of us recognize that alternate energy sources are important. We are living in a fool's paradise if we believe the energy crisis is over. All we have is some time in which we can get our house in order, so to speak. We do not have an energy or oil crisis now because of general economic conditions and because more oil and gas fields have been developed in the last number of years. However, we all know that oil and gas are not renewable resources. They are finite resources. Eventually mankind will have to face the fact that we have run out of these precious resources. To do nothing would be criminal. It would be socially irresponsible for any Government to claim that there is no longer an energy crisis and therefore we do not have to do any further research into alternate forms of energy. Regardless of what political Party is in power, any Government which took that attitude would be socially irresponsible. As I mentioned before, common sense tells you that at some stage down the line we will again be facing shortages of oil. The resolution in front of us makes sense from that point of view.
It also makes sense from the environmental point of view. A few years ago, I believe in 1983, the U.S. Environmental Protection Agency reported on the greenhouse effect. That report stated that this greenhouse effect will be felt and seen within a 15 to 20 year period. Airborne carbon particles will cover the globe and trap the earth's heat within the atmosphere causing major climatic and environmental changes which will have tremendous effect on the world as we know it today. At that time I asked the then Minister of Energy, Mines and Resources if he considered this report to be a serious one and would he give the same type of grants and incentives to developing alternate energy sources as he was providing to the oil companies. He pooh-poohed the idea. He suggested there was no linkage between the greenhouse effect and the grants and subsidies we were giving to the oil industry, particularly for drilling for oil in the Beaufort and along the Atlantic coast. Well, a good case can be made that all forms of energy research receive the same type of grants, incentives and tax breaks. I really wonder whether Government can determine what type of technology is developed through its taxation and grant programs. It seems as well that there was a degree of social irresponsibility when on the one hand we have some of the best scientists in the world warning us about the greenhouse effect, and on the other hand another arm of Government is promoting the very thing which will cause the greenhouse effect.
I found it unfortunate that at the beginning of this Government's mandate it chose to counsel some of the important work that the National Research Council was doing into alternate energy. At that time, in front of the Standing Committee on Miscellaneous Estimates, the Minister of State for Science and Technology (Mr. Siddon) stated that: "In many cases, after some 10 years of funding, it has become evident that, particularly in the areas of solar and wind energy, the return on that investment was not evident". I have expressed before in this
Octane Enhancers
House the sentiment that new forms of energy do take a long time to develop and make economically viable. As such, I have to disagree with the Minister when he says that 10 years is enough. I have pointed out previously that nuclear energy took 30 years of research and development before it became economically viable. Even now, there is a good question whether it is still economically viable.
I really do not have much more to add to the debate, Mr. Speaker. I think the mover and the spokesperson from the Liberal Party have covered many of the points I was going to raise. I will not repeat what they have said other than to indicate that we in the NDP support the resolution. We hope that the standing committee will seriously consider this motion. We welcome as well the establishment of a committee, which I understood was announced last week, to deal with hydrogen. Hydrogen is my choice for the ideal fuel. It is the cleanest fuel. Its only by-product is water vapour. Considering the warnings we have received about the greenhouse effect, I believe the fuel of the future is hydrogen. That was the conclusion of a special committee of Members of this House a few years ago. Their chief recommendation was that we begin to change Canada to a country which is based and dependent upon hydrogen. I would like to see hydrogen added to this list but it is my understanding that a committee has been struck to investigate the potential of hydrogen and the state of art of that technology. Therefore, I will accept the resolution as is, although I understand that the Government speaker after me will introduce a minor amendment which we will support as well.
In conclusion, we support this private Members' resolution and congratulate him because he will be one of the few lucky ones to see this resolution actually pass this House and not be talked out.


Mr. John McDermid (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, first of all I want to congratulate my good friend, the Hon. Member for Kent (Mr. Hardey) for introducing this very thoughtful motion. It is something that I know the committee concerned with natural resources is anxious to get its teeth into for an in depth study. If I might, I want to for a few moments talk about this well intentioned motion and introduce one concern that I have which will cause me to, with your permission, introduce an amendment at the end of my remarks.
The one area that I am concerned about in the motion is that the federal Government should direct Petro-Canada. We all know that the federal Government has no authority to direct Petro-Canada to take the lead in the production and distribution of gasoline blended with octane enhancers. Petro-Canada is an autonomous company in pursuit of commercial goals, and such a federal directive could be interpreted as interventionist. Nevertheless, it is interesting to note that, without any federal prompting, Petro-Canada has been conducting studies on the use of methanol and ethanol extenders. 1 will be introducing an amendment a little later to that effect.

October 15, 1985
Octane Enhancers
1 would like to deal with this motion as three distinct issues; the first relating to the removal of lead and MMT, the second focusing on addition of alcohols, and the third on the role of Petro-Canada. I would first like to discuss the removal of lead and MMT.
Approximately 50 per cent of Canada's vehicles use leaded gasoline while the rest use unleaded gasoline which is required for vehicles fitted with catalytic converters to reduce exhaust emissions. There has been considerable concern over lead emissions from vehicles that use leaded gasoline. The Minister of the Environment (Mr. McMillan) is responsible for regulating lead under the Clean Air Act. As of January 1, 1987 allowable lead levels will be reduced to .29 grams per litre from .72 grams per litre. No further reductions have been announced and I believe that any additional decrease in allowable levels will be based on a full assessment of related economic and health factors.
Such an assessment will take into account the findings of the Commission on Lead in the Environment headed by the Royal Society of Canada which is soliciting views and information from all interested parties in Canada. This commission will present a preliminary report to the Minister of the Environment later this fall with a final report scheduled for release in the fall of 1986.
In the interim, the Canadian Government is carefully monitoring developments in the United States relating to the lead issue. In that country allowable lead levels will decrease in 1986 to .03 grams per litre. In addition to these reductions, the U.S. Environmental Protection Agency has also proposed that, in due course, lead be banned completely. This proposal is rooted in the suspected health hazard of lead emissions as well as in the misfueling issue whereby cheaper leaded fuel is used in cars designed for unleaded gasoline resulting in damage to emission control devices.
MMT in the quantities currently used in Canada is not a health hazard. It is banned in the United States because American officials suspect that MMT contributes to increased exhaust emissions. The Minister of the Environment is currently examining the use of MMT in Canada. In a decision to change current use of MMT in this country-the only reason I am saying MMT is that I cannot pronounce the big words that it represents. I could spell them but I will not. They are very long and even for an old radio announcer they are tough to pronounce.
The use of MMT in this country would be based on a full assessment of economic factors and emission requirements. One factor in this assessment will be the adoption in 1988 of emission standards for light duty vehicles that match those in the United States. These more stringent emission standards may be difficult to meet if continued use of MMT is permitted. That would be in the future.
I would like to move along to the area of additions of alcohols to fuels. Lead and MMT are linked to ethanol and methanol because all four increase the octane or "anti-knock"
ratings of gasoline. Octane is an important property of gasoline and refiners must absorb costs to ensure their gasolines met octane requirements, obviously in as cost-effective a way as possible. Lead has been the cheapest, and therefore the preferred way to raise octane. As lead use decreases due to the reduction in permissible levels and to the increasing use of unleaded gasoline, refiners must adopt other means of raising octane. Options range from switching additives such as MMT and alcohols to modifying refinery processes.
However, new processes may require large capital expenditures and may increase oil consumption. The Department of Energy, Mines and Resources holds the view that the alcohol-ethers option could be the attractive one for Canada for the reasons cited by the Hon. Member for Kent in his motion. Alcohols and ethers are made from domestic resources like natural gas and biomass that are abundant and could reduce light oil imports. Preliminary studies show economic benefits could stem from their production and use.
The Hon. Member refers specifically to corn which would be used to make ethanol and natural gas which would be used to make methanol. At this time I would like to report to the House that the Ontario Corn Producers' Association which is headquartered in Guelph has made representation to me as have a number of other associations interested in this production. The Ontario Corn Producers' Association has 25,000 members and it has written a letter to thank members of the Government for their support which permitted advance payments for crops. The Ontario Corn Producers' very kindly lauded the Government for its action and said how important this is for them. They wrote us all a thank you letter. In this business we do not get too many thank you letters, so 1 just wanted to put on record today that the Ontario Corn Producers' Association recognized the good work of the Government in its Department of Agriculture through some of the advance payments that were made permitting them to receive some cash while the harvest is being brought in in October and November. I got a little off the subject, but I did want to publicly thank the Ontario Corn Producers' for recognizing our good work.
While the Government is very interested in promoting increased use of domestic resources, it believes that market forces should determine which is most economic. It may be inappropriate to favour one resource over another. In particular, different feedstocks such as other cereals, wood, and liquefied petroleum gases could pay a role in the production of alcohols for gasoline blending.
There is some extensive testing on alcohol-gasoline blends going on. I could discuss these but I think the committee will go into great detail in examining this entire matter. It has a very wide scope and a number of excellent witnesses can be called before the committee to consider all aspects of this proposal from auto manufacturers to the Ontario Corn Producers' Association and Celanese Canada Inc. I know that our friends at St. Lawrence Starch are interested in making a presentation to the committee. There are a number of groups
October 15, 1985

that will be called before the committee to give evidence. We are very pleased about that.
I would like to briefly discuss the role of Petro-Canada in connection with Motion No. 218. Petro-Canada has done a considerable amount of work in evaluating the potential of octane enhancers, especially methanol. It has conducted several joint studies on methanol with Celanese Canada Inc., the most recent of which was managed by the Ontario Research Foundation and involved 60 vehicles being driven in typical owner-operator situations. The results of these initial studies indicate to Petro-Canada that there are still some unresolved concerns over the use of alcohol blends in Canada. It is also not clear that the sale of these blends would be financially advantageous to the company. Again, those who have been involved in this research would make excellent witnesses before the committee. I am sure that the chairperson will be happy to call these witnesses in order that we may have the benefit of their advice. I might also point out that through the recent Gulf acquisition, the research facility at Sheridan Park in Mississauga has now been obtained. Of course, we have been assured that broadened fuel research can take place there.
The Government believes that Petro-Canada should compete in the market-place on the same basis as all other oil companies. This means that Petro-Canada will receive no special support from Government. It also means that the managers of Petro-Canada must be free to make management decisions based on their best assessment of market demands. If these fuels prove to be commercially and socially attractive, we believe that Petro-Canada will want to take a lead role in marketing them.
However, the present wording of the motion limits the feasibility of producing and distributing for sale these additives through its Crown agency, Petro-Canada. If this is found to be beneficial for Canada, I believe that all companies dealing in these products should be included in this. Therefore, I move:
That the motion be amended by deleting the words "through its Crown agency, Petro-Canada".
The remaining words in the motion should remain.


The Acting Speaker (Mr. Paproski):: Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.
Motion (Mr. McDermid) agreed to.


Walter Leland Rutherford (Lee) Clark: Mr. Speaker, I wish to say a few words in support of the motion. Let me begin by congratulating the Hon. Member for Kent (Mr. Hardey) for presenting a very timely motion to the House.
In the time remaining, I would like to concentrate on a certain portion of this proposal. Needless to say, we all recognize the importance of a proposal which has the possibility of producing a new petroleum product which would mean less acid rain emission. We also recognize the importance of
Octane Enhancers
providing an alternative fuel source, bearing in mind that petroleum resources are naturally limited.
What is of particular interest to me is the possibility that this study and the use of this particular fuel supply can provide an alternative market for agricultural products. I want to talk particularly about an experiment which is currently under way in the Province of Manitoba and on the Prairies. It involves a company by the name of Mohawk which, since 1982, has been selling a product called gasohol in the Province of Manitoba. Since 1984 it has been providing a product in the provinces of Alberta and Saskatchewan by the name of EM Gasohol.
It is of particular interest to us in the Province of Manitoba that Mohawk is producing the ethanol which is the key product of gasohol in the neighbouring constituency of Port-age-Marquette in the community of Minnedosa. It is of particular interest this year that Mohawk at this plant is able to take advantage of and make use of agricultural products which have been severely damaged by bad harvest conditions. For example, in the fall of 1982 there was a severe frost which affected the corn crop. Mohawk was able to make use of that corn, even though it was damaged. It found an important economic use, regardless of its quality.
Since then, in the same plant in Minnedosa, the company has been experimenting with the use of sprouted barley, sprouted rye crop and considering the possibility of making use of feed wheats which, unfortunately, will be far too available this fall.
I also understand that there is a possibility that the company can make use of waste cheese whey. Should this experiment prove to be successful, we might have the ability in western Canada, if not all of Canada, to develop a domestic market. All of us who are concerned about the future of agriculture in Canada are very conscious of the fact that we have been too dependent on export markets for our agricultural products. Anything that we can do to increase domestic markets, particularly alternate domestic markets, is very clearly to our advantage.
You come from the great Province of Alberta, Mr. Speaker, and many Members come from western Canada. They are intrigued by the possibility of making use of scrub poplar as well as scrub spruce as a source of alternative supply.
Therefore, the economic advantages are extremely interesting. For those who may not have had an opportunity to make use of this particular product, as a casual customer I believe the market acceptability of gasahol is improving with the passage of time. However, I must confess that the automobile which I drive back and forth to the airport in Winnipeg is of such vintage that I cannot tell whether or not it is performing better when I use gasahol. However, others tell me that it is so.
Furthermore, the fact that this product has a built-in antifreeze is certainly of some advantage to those of us in western Canada during the winter. Although the time allotted for this subject is not as much as it should be. I look forward to this subject being referred to committee. However, I think you will find, Mr. Speaker, that there is an inclination in the House

October 15, 1985
Adjournment Debate
that prior to calling it 6 o'clock the motion as amended will be accepted.


The Acting Speaker (Mr. Paproski):: Shall the motion, as amended, carry?


Some Hon. Members:: Agreed.
Motion, as amended, agreed to.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Standing Order 46 deemed to have been made.

Mr. Alan Redway (York East):: Mr. Speaker, during the last election campaign many concerns were pointed out to me. However, one of the major concerns was the question of fairness of our income tax system. While many people were concerned about the complexity of the income tax system, the key concern relating to income tax was one of fairness and whether or not everyone paid some income tax. The real issue revolves around the concern that some high-income earners are not paying any income tax at all.
The Department of National Revenue, in its statistics, pointed out that some 5,500 people earning $50,000 or more per year paid no income tax whatsoever. In addition, it pointed out that even more than 5,500 people earning $50,000 per year paid 10 per cent or less of their income in income tax.
There are those people who feel there is nothing wrong, that there are good and legitimate reasons for high-income earners not paying income tax. They point out, for example, those people who make charitable donations which go toward good purposes. There are other reasons for people not paying income tax, the dividend tax credit being one. That provision is in the Income Tax Act to encourage Canadians to invest in taxable Canadian corporations. The provision respecting contributions to RRSPs is included in the Income Tax Act to encourage people to contribue to their own retirement, not to rely solely on the state to provide their pensions. Business and farm losses are deductible from income and result in no income tax being paid. Of course there is a very valid social reason, the fact that many people have to pay support payments to former spouses, separated spouses or children living separate and apart from them.
Notwithstanding these legitimate reasons, most people are concerned about the fact that some people do not pay income tax while the vast majority, probably earning less money, have
to pay a very substantial proportion of their incorhe in taxes to the Government. They feel that this is unfair and that perhaps they should be looking for ways of getting around having to pay any taxes. Of course there is potential for income tax cheating and for the creation of an underground economy where people deal in cash or deal in trading kind for kind so that there will be no income to report or taxes to pay.
As a result of the concern about high-income earners paying very little or no income tax, there was the great debate of the last election campaign when the Leaders of all three political Parties expressed their concerns about it. Most Canadians were pleased when the then Leader of the Official Opposition, the Prime Minister (Mr. Mulroney), indicated that he was in favour of bringing in a minimum income tax. In fact, he said that it should be a very handsome tax to be paid by large-income earners who were paying very little or no income tax.
There was a good deal of disappointment when, on May 23, the Minister of Finance (Mr. Wilson) did not introduce a minimum income tax. Of course, while he did introduce one to take effect immediately, he indicating that there would be a minimum income tax to take effect on January 1, 1986. At the same time the Minister released a discussion paper outlining certain alternatives for such a tax. There were three alternatives outlined in that discussion paper.
The first, as you will remember, Mr. Speaker, was the alternative minimum tax, which would involve two calculations of one's income tax, with the larger amount representing the taxes payable.
The second alternative was the add-on minimum tax, which would see an amount added where the taxes payable fall short of a certain level. In those instances where no taxes are payable, a minimum tax would be applied.
The third alternative would see a limit placed on the tax deductions available. Under that option, the full lump sum of deductions would not be available to taxpayers. Rather, only a portion of the tax deductions that we now have would be allowed.
In one of these ways there would be a minimum tax paid, but its form was a matter left open for discussion and decision.
Since that time the Minister of Finance has consulted with the provinces, and apparently all of the provinces are agreed that there should be a minimum tax. The question remaining has to do with its form and the income level at which it will commence. Will it be the $30,000 level as it the case under the American system, or the $50,000 level that the NDP has suggested?
I am hoping that tonight we will hear from the Parliamentary Secretary to the President of the Privy Council (Mr. Dick) the details of this minimum tax and exactly when it will be announced. But realistically, Mr. Speaker-and 1 see him shaking his head in the negative-I know that that is not going to happen; that probably we will just hear, "In due course, it will be announced".
October 15, 1985


Paul Wyatt Dick: Mr. Speaker, I am pleased to have the opportunity to speak on this issue. In my view, the minimum tax represents a very important development in improving the basic fairness of the tax system. The discussion paper on the minimum tax, tabled in the last Budget, presented three possible options for a minimum tax; an alternative minimum tax (AMT), an add-on minimum tax, and a limit on tax preferences (LTP).
Under the AMT option, a separate and alternative tax structure to the regular income tax would be established. The AMT would have its own tax rate which would be applied on an expanded income base.
The second option, the add-on minimum tax, would effectively serve as an additional levy on the use of a specified list of preference items above a certain exemption level.
Finally, the LTP option would place a limit on the use of specified tax preferences within the operation of the existing income tax system. For example, preference deductions and exemptions could be disallowed to the extent that they exceed a certain percentage of total income, with no disallowance if they are less than a specified dollar amount. A similar limit would be placed on the use of preference credits.
The Hon. Member's question concerns the exemption that will be provided under a minimum tax. In this regard, it is important to recognize that under each of the three possible options, the exemption operates in a distinctly different way. For example, under the AMT option the exemption level relates directly to the income of the individual. On the other hand, under the add-on approach or the LTP option, the exemption level applies to the amount of preference deductions and credits claimed by the individual. As a result, the exemption levels under the add-on and LTP options would not need to be similar to those under the alternative minimum tax option to provide the same relief to lower income individuals.
I should also note that for the LTP option two separate exemptions would be required, one for deductions and exemptions, and the other for tax credits.
One can see from these examples that the appropriate exemption levels will vary depending on the form of minimum tax structure that is chosen. I should add that the exemption level will also depend on the preference items that are included in the base for the minimum tax.
For example, if personal exemptions are allowed as a deduction from an AMT tax base, the general exemption level would not have to be as high as it would be if personal exemptions were excluded in the minimum tax calculation. Similarly, under an add-on tax or an LTP, the broader the list of tax preferences included under the minimum tax, the higher the exemption level should be.
The Minister of Finance (Mr. Wilson) has received a number of submissions on the minimum tax from interested parties. Recently the Minister met with his counterparts from the provinces and discussed the minimum tax options with
Adjournment Debate
them. These consultations have been very helpful in the analysis of the possible options.
At this time, the form of minimum tax, as well as the level of exemption and the breadth of the base of the tax, are still under consideration. However, 1 am sure that an announcement covering the Hon. Member's question will be made in the future, and certainly in time to introduce a minimum tax on January 1, 1986, as promised.


The Acting Speaker (Mr. Paproski):: I regret to inform the Hon. Parliamentary Secretary to the President of the Privy Council (Mr. Dick) that his time has expired.


CUSTOMS AND EXCISE-PLANNED REDUCTIONS IN INSPECTION PERSONNEL
Bill Attewell: Mr. Speaker, on Tuesday, September 24, I asked the Minister of National Revenue about the proposed cut in Customs and Excise jobs which are planned over the next five years in connection with the planned centralization of the examination of international parcel mail.
Many of the residents of my riding of Don Valley East are very concerned about the problems of drugs and pornography. While I strongly applaud the Minister's initiative to do his share in reducing the size and cost of Government in this country, I would like his assurance that the rigid control that we require in order to reduce the illegal importation of drugs and pornography will be improved through this process and not in any way weakened.
I do want to share a few thoughts about my reasons for applauding the Minister for his share in helping reduce the size of Government. 1 believe the proposed cuts amount to about 8 per cent of the total. Individual Ministers can, as this Minister has, show leadership and do their share in reducing the size of Government. Canadians right across the nation are very concerned not only about the size of the federal Government but about the sizes of the various provincial and municipal Governments. Individual Members like myself can help with committee work and by offering ideas and suggestions to the various Ministries.
Deficits are a relatively recent phenomenon in this country. In the last 10 or 15 years, every year in succession has shown an ever-increasing deficit to the point where our cumulative debt is now well over $200 billion. I regret to project this, but by 1988, just three years from now, the total debt will likely be around the $300 billion mark.
I applaud the Minister for his action but I do want to talk about the risks that might be inherent in the steps that he is taking. Just before 1 do that, may I just highlight again the size of the bureaucracy in Ottawa? A recent article in a local newspaper highlighted a number of such instances. Let me cite two or three of them.

October 15, 1985
Adjournment Debate
The Canadian International Development Agency in 1970 had one president and three vice-presidents. In 1985, 15 years later, the same agency has one president, one senior vice-president and 10 vice-presidents. Agriculture Canada, in 1970, had one Deputy Minister and three Assistant Deputy Ministers. Today, in 1985, it has one Deputy Minister, one Associate Deputy Minister, one senior ADM and six ADMs. Even the Government's watchdog agency, the office of the Auditor General, has seen costs mushroom and grow. In 1970, that agency had one Auditor General and one assistant. Today, it has one Auditor General, three Deputy Auditor Generals and 12 assistant Auditor Generals.
I have had over 30 years of experience in a financial institution and my experience is that when one wants to cut costs, it must be done together with cutting back on the number of jobs in one's own agency. Again, I applaud the Minister for what he is doing, as the people of Canada are looking for this type of leadership.
My main area of concern is the harmful and insidious impact of drugs and violent pornography on this country and how they are eroding the values of our social and family lives, the cornerstone of our great country. I can speak with firsthand knowledge of the terrible use of drugs which goes on at several local high schools and shopping plazas in Don Valley East. The local police are almost perplexed about what to do with the drug problem that exists.
During the election campaign of 1984, I attended at a housing development during the supper hour. At 11.30 that night a man telephoned me from that housing development. He was worried and asked if we could not do something to help reduce the drug trafficking problem in that local housing development. He told us that while he was talking to a few youths drug trading was going on just a few feet from him. I am concerned, Mr. Speaker, that in no way should the action of the Minister create any increased risk of extra drugs in this country.
Just to comment on the terrible problem of violent pornography in this country, it has spread now to the video tape machines in this country. I attended with my wife a symposium on private violence several months ago in Toronto. We were disgusted with the type of hard-core violent pornography which exists in this country today, and through the leadership of agencies such as the Minister of National Revenue (Mr. MacKay), the Solicitor General of Canada (Mr. Beatty) and the Minister of Justice (Mr. Crosbie) I am very hopeful that this terrible problem can be reduced in this country.
Let me just close by saying that while I applaud the Minister very strongly for his initiative in doing his part to reduce the cost of Government in this country, I just ask for his assurance that it in no way will increase the problem of violent pornography in this country and the use of drugs.


Mr. Pierre H. Vincent (Parliamentary Secretary to Minister of National Revenue):: Mr. Speaker, as you are aware, the
Government's restraint program, as initially described in the economic statement of the Minister of Finance (Mr. Wilson) in November 1984, and reaffirmed in the budget of May 1985, requires that the Public Service be reduced by 15,000 person-years over the next five years. In support of this over-all Government initiative, Federal Departments were asked by Treasury Board to develop plans whereby their person-year base would be substantially reduced over the next five years.
In compliance with this request, The Department of Customs and Excise developed a departmental plan which will lead to a reduction in person-years from a 1985 figure of 10,148 to 9,292 by 1990, a total decrease of 856 person-years. These reductions will be implemented in accordance with specific targets which have been established for each year of the five year period. This plan will be submitted to Treasury Board for approval this month.
In approaching this task, the department selected measures that would allow it to streamline its operations, improve productivity and, where possible, transfer operations to the private sector. None of these reductions will effect the department's capability to carry out its mandate, including the interception of pornography and illegal drugs coming into Canada.
The postal improvement project was established to achieve significant resource reductions in customs' postal operations. A pilot test will be conducted in the Montreal region beginning in October. National implementation is scheduled for April 1986 if the evaluation of the project demonstrates that the new postal system is successful.
The purpose of centralizing the examination of international mail would be to improve service to the public while substantially reducing cost by streamlining customs mail processing operations. Customs' ability to screen the mail entering Canada will not be affected by this centralization. Customs inspectors will continue to examine the mail, assess duty and taxes owing and prohibit the entrance of such goods as drugs, pornography and firearms. Customs processing of international mail will be concentrated in 12 centres, thus alleviating Canada Post's routine concerns, because over 99 per cent of international mail entering Canada will pass through these 12 centres. Furthermore, the concentration will enable Customs and Canada Post to eliminate a considerable amount of double handling of dutiable mail. Recipients of dutiable mail will no longer have to visit Customs offices to collect their goods.


The Acting Speaker (Mr. Paproski):: 1 regret the Hon. Parliamentary Secretary's time has expired.


FISHERIES-REFINANCING OF FISHERY PRODUCTS INTERNATIONAL. (B) COMPANY'S SOCIAL RESPONSIBILITY
George Baker: Mr. Speaker, a couple of days ago I asked the Deputy Prime Minister (Mr. Nielsen), presently the Acting Minister of Fisheries and Oceans, with responsibilities as well for several other Govern-
October 15, 1985

ment Departments, a question relating to the restructuring of Fisheries Products International. I asked him what guarantees would be given to the communities where the Government claimed plants would be disposed of over a three-year period in Newfoundland. He stood in his place and said that I was twisting the facts and raising undue alarm in these communities.
In my supplementary I pointed out that even the Hon. Member for St. John's West (Mr. Crosbie) had made exactly the same statement that same afternoon. We all wanted to know the answer. He then passed it to the Minister responsible for small business who stood up and gave what I call the typical non-answer we get from the Government these days. He said absolutely nothing. That is why I wanted to deal with this question this evening. I note that the Hon. Member for Charlesbourg (Mrs. Tardif) has been designated to answer the question, she being the Parliamentary Secretary to the Minister of Regional Industrial Expansion. I am sure I will hear a lot more common sense from that Hon. Member than I would from the Deputy Prime Minister, as I am sure you will agree, Mr. Speaker.
The Government has said, and there is no sense in denying it, that 15 fish plants in Newfoundland will be disposed of over a three-year period. That is serious because it involves 15 communities. For the record, let me give the House the names of those communities and the number of jobs involved. We have the Port aux Basques fish plant with 414 employees; we have the Rose Blanche fish plant with 170 employees; and the St. Lawrence fish plant with 102 employees. These plants are to be closed down and disposed of. We have the Charleston plant with 649 employees; the Fermeuse with 218 employees; the Twillingate plant in my riding with 404 employees; the Englee plant with 270 employees; and the Cow Head plant with 39 employees. Then we get down to the plants which are leased to Fisheries Products International. We have the plant at Flower's Cove with 110 employees, the Anchor Pointnplant with 113 employees, the Great Harbour Deep plant with 39 employees, the Bridgeport plant with 49 employees, the Black Tickle plant with 68 employees, the Williams Harbour plant with 39 employees, and the Bide Arm plant with 79 employees. Why did the Minister not release this list when he announced the disposition of these plants? This adds up to 2,775 employees, and that is, at the low point in the fishing season, and not counting part-time staff. We are talking here about a total of 5,000 jobs in Newfoundland.
This is a very important matter which has really not sunk home for the people in Newfoundland, but I am sure it will very soon because there is no other employment in these communities. The Government has already said these are unprofitable plants. Just imagine, putting fish plants on sale and saying they are unprofitable. The Government says the equipment is not up to date and the plants cannot operate economically, yet it expects someone to come along and buy them. This is an absolute violation of an agreement made when Fisheries Products International was created. The Newfoundland Government and this federal Government said no fish
Adjournment Debate
plants would close. Now we have this incredible figure of 2,775 employees who are going to lose their jobs over the next three years.
You can see, Mr. Speaker, why I have raised this question here. In fact, if there were not so many important things going on in this Chamber and so many embarrassements for this Government which we have to delve into, I would be up on my feet every single day in this Chamber about this matter. In my riding alone some 550 employees are going to lose their jobs due to this restructuring. I am sure that the Parliamentary Secretary will at least shed some light on this agreement that has been made and will at least give us some hope for the future, certainly more than the Deputy Prime Minister would give.


Mrs. Monique B. Tardif (Parliamentary Secretary to Minister of Regional Industrial Expansion):: Mr. Speaker, I am always pleased to answer my colleague, the Member for Gander-Twillingate (Mr. Baker), and I am not embarrassed at all by his question.
I would like to remind him that the two Government shareholders of Fishery Products International Ltd. have jointly approved the business plan of FPI and have agreed to share an additional equity investment of $105 million. The plan anticipates earning a return on the investment, paying dividends to shareholders, profit-sharing with employees, returning plants to the private sector and creating a modern viable fish harvesting-processing-marketing operation. The new investment will permit FPI's management to achieve its goal of commercial viability and privatization. It completes the restructuring process begun in 1983.
Following the initial investments by the shareholders as part of the restructuring process, the company was plagued with a number of unforeseen events including a delay in appointment of a new senior management team and an eight-month strike by trawlermen. The impact of these problems on operating profits was aggravated by very poor cod product prices until recently and by the disappointing in-shore fishery in 1984 and 1985. With these extraordinary problems now in the past and the new equity investment the company's management team now in place can deal more effectively with economic downturns. They have set forth a program to exploit market opportunities and to respond promptly to changing circumstances. [Translation]
Mr. Speaker, in its commercial plan the company has provided for the disposal of fifteen plants within the next two years, to achieve its goals of profitability and privatization. However, FPI intends to operate all these plants during the two-year period, and no decision has been made to close any of the plants the company intends to sell.
The plants that are now sold will be assessed in FPI's 1988 commercial plan in terms of their overall production at that time. The purpose of privatization is to restructure FPI and not to diminish the status of these plants. FPI does not intend

October 15, 1985
Adjournment Debate
to reduce its efforts regarding their operations. In addition, capital expenditures will be made, if necessary to keep the plants open. Prospective buyers will have to provide a firm operating plan to ensure that the plants have a realistic future in the industry.
In its petition on countervailing duties submitted to the U.S. Department of Commerce, the task force on North Atlantic fisheries indicated that the Government's investment in the Atlantic fisheries constituted a subsidy. There is some apprehension that this investment would give further weight to this argument.

We do not feel that this is the case, Mr. Speaker. In the past the United States has regarded Government equity investment as a subsidy in cases where there was no expectation of a commercial rate of return on the investment. The original
1983 investment was made on the basis of adequate returns forecast. As noted, there has as yet been no return due largely to unusual circumstances which could not be foreseen in 1983. A reasonable rate of return is expected on the investment being made now and on all the funds invested.
FPI's management and board of directors are aware that no further investment will be made and that they must manage the company with the resources in hand. There is no question of continuing equity infusions which could be considered a subsidy.


The Acting Speaker (Mr. Paproski):: The motion to adjourn the House is now deemed to have been adopted. Accordingly, the House stands adjourned until tomorrow at 2 o'clock p.m., pursuant to Standing Order 3(1).


[Stage Direction]
The House adjourned at 6.31 p.m.
[Stage Direction]
Wednesday, October 16, 1985