1985-11-05

[Stage Direction]
The House resumed from Tuesday, October 29, consideration of the motion of Mrs. McDougall that Bill C-80, an Act to amend the Excise Tax Act and the Excise Act and to amend other Acts in consequence thereof, be read the second time and referred to a legislative committee.
Hon. Douglas C. Frith (Sudbury):: Mr. Speaker, I am very pleased to be allowed to join in the debate on Bill C-80 this morning. There are several points that I would like to make over the next 10 minutes. I would like to refresh the memory of the House regarding some of the campaign promises made one year ago and relate them to Bill C-80.
It was only 14 months ago, in the midst of a national election campaign, that a promise was made by Conservative Members that if they were to take office, any budgetary measures they would introduce would ensure that more resources would be placed in the hands of those who need them the most. That was going to be the guiding principle of the Government. Since that time, all Canadians have had time to digest the over-all direction of the Government. Upon reflection, I think most of us would have to agree that if anything, once again the Conservative Government has broken its promise to put more into the hands of those who need it the most. Bill C-80 is a good example of that.
As was pointed out at a press conference held some 10 or 12 days ago by the National Anti-Poverty Organization, Bill C-80, an Act to increase excise and federal sales taxes, will impact twice as hard on the poor as it will on upper-income earners. In an analysis of the impact of this budgetary measure, the organization points out that excise taxes and sales taxes are regressive because of that. As a result, the organization would like the Government to withdraw the Bill and bring in one that is progressive to some degree.
It comes as no surprise to the Opposition that the Government has again introduced a Bill that is regressive in nature. One need look no further back than to the impact of the deindexation of personal exemptions in the May 23 Budget. I have pointed out time and again that that measure alone will
do more to widen the gap between the poor and the rich than any other budgetary measure that the Government could possibly bring in. Yet my complaints seem to have fallen upon deaf ears. All Conservative back-benchers represent constituents but they have been amazingly silent on this issue. It comes as no surprise to the Opposition that they would be silent on the matter. However, it is incumbent upon the Opposition to point out the folly of the Government's direction.
I said earlier that Bill C-80, the Bill to increase the excise and federal sales taxes, is regressive in nature. 1 would indicate as well that the deindexation of personal exemptions will be even more so. What is the full import of that kind of change in policy direction by the Government? It is astounding.
The various social council agencies that give advice to the Government including the Canadian Council on Social Development and the National Council on Welfare have had things to say about this impact. In a study released just two months ago, they indicated that from 1980 to 1984, before the Conservative Government came to power, there had been a widening in the gap between the poor and the rich. Despite all of the Guaranteed Income Supplement measures that the previous Government introduced between 1980 and 1984, the gap was still widening largely as a result of the recession. Clearly the point I am making is that there was a widening in the gap between the poor and the rich in those four years. Now, on top of all the other problems that are besetting the lower-income groups in our society, deliberate Government policy is going to widen that gap further.
The councils to which I refer have made some calculations and these numbers are not disputed by the Government, by the Minister of National Health and Welfare (Mr. Epp) or by the Minister of Finance (Mr. Wilson). They indicate that because of the deindexation of personal exemptions, a family that earns $15,000 per year is going to pay an additional $1,879 in taxes over the next five years. A family that earns $35,000 per year, a middle-income family, is going to pay an additional $3,450 in income tax over the next five years. However, what happens to the family that earns $80,000 per year? Amazingly, it will only have to pay an additional $1,612 in taxes over the next five years. In other words, the councils that represent middle and lower-income earners question the political and social policy direction of the Government, a direction that will widen that gap despite the fact that they have clearly shown that as a result of the recession, lower-income Canadians are the ones who have suffered the most in the last four years. They are now expected to suffer doubly over the next four to five years as a result of the Government's proposals.

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I indicated to the House that the report of the National Anti-Poverty Organization indicated that the impact of the federal excise tax will be twice as hard on the poor in our society. More important, the organization indicated something which I think should clearly be at the heart of the debate, not only with respect to the excise and federal sales tax measures but with respect to the direction of the May 23 Budget. The organization shows that the most important source of revenue for the federal Government comes from taxes, which comes as no surprise. Everyone knows that if we have expenditures and Government programs someone has to pay for them. Amazingly, of the S63.8 billion derived from tax revenue in 1984-85, fully 90 per cent of that came from personal income tax and from commodity taxes and the rest was derived from miscellaneous and corporate income tax.
Corporate income tax in the country in the last two and a half decades accounts for a decreasing share of tax revenue for Governments. Here we have a situation in which, once again, we will have to pay increased taxes under the May 23 Budget. If anything, these corporations have been given more tax breaks. Members who have spoken on these measures, and other Bills, have indicated our displeasure with respect to them. Corporations are not being asked to pay increased taxes. Rather, middle income and low income Canadians are being asked to pay more, which is why we are so disturbed that, seemingly, the Government does not understand why the social policy direction inherent in not only this Bill but in others is being opposed by the majority of Canadians. Yet, every time we raise the issue during Question Period the answer comes back to us in terms of: "What are you complaining about? The Government has certain measures which will, in fact, put more into the hands of the poor". Nothing could be further from the actual case.
I ask Hon. Members to consider Bill C-70, a Bill which proposes deindexation of family allowances. We have had the opportunity to review this Bill clause by clause with expert witnesses who have appeared before the committee. Every one of the social policy agencies in the country and every one of the groups which represent women and the poor in our society have indicated the falling off of the Government's social policy direction as a result of the May 23 Budget. I include in this category specific groups which do not represent national interests but pockets of poverty-stricken individuals in communities in Calgary, Saskatoon and so on.
This is why members of the Opposition are so adamant about ensuring that the Government bears in mind that the interests of our constituents, middle income and low income Canadians, are well served by our opposition to these types of Bills. I understand, of course, that with 211 Members, the Government can do exactly as it pleases. However, we want to ensure that the Government bears in mind the interests of our constituents when it introduces Bills such as C-70 and C-80 and, of course, other Bills which will be introduced with respect to changes in the Income Tax Act.


Mr. Jean-Pierre Blackburn (Jonquiere):: Mr. Speaker, I want to thank the House for this opportunity to speak to Bill C-80. Quite frankly, the responsible but painful decision we are about to make is merely the result of the policy the previous Government maintained for fifteen years without any regard for sound financial administration.
Mr. Speaker, Bill C-80, the legislation before the House today that concerns federal sales and excise taxes, is aimed at reversing the considerable erosion of the federal tax base caused by a lack of leadership on the part of the previous Government, which spent money without worrying about where it would come from. Red stands for Liberals, and they were indeed in the red.
The question we must ask ourselves today is, again quite frankly: Why are we obliged to impose these tax increases?
Mr. Speaker, this Bill should be seen within the context of the changes and proposals announced by the Minister of Finance (Mr. Wilson) last May. This Bill is a financial measure, and its purpose is mainly to keep our national debt within bounds through a number of measures that either produce revenue or reduce tax expenditures.
Unfortunately, I will now have to remind my hon. friends opposite of some of the consequences of their actions, actions that caused them to lose power, and subsequently, Canadians inherited a cumulative debt unprecedented in our history.
In 1968, only seventeen years ago, Mr. Speaker, our country had a budgetary surplus of $750,000, and now, seventeen years later, the country's national debt has risen to $200 billion, while interest rates have reached unprecedented levels, and I am thinking here of people who have payments to make on their homes, and I remember two years ago when we had interest rates of up to 18 per cent and even more, bringing Canadian industry to the very brink of bankruptcy, and causing the country's gross national product to drop so dramatically that around 1982, people were wondering whether Canada, as a result of the policies of the Liberal Government at the time, had become a country where the slogan was no longer "back to the land" but "into the ground".
Mr. Speaker, whatever my friends opposite may think, 1 take no pleasure at all in reminding Canadians of a time we would all like to forget. Mr. Speaker, forget is the word, because that time is certainly not representative of the imagination, know-how and courage of the Canadian people. During that time we were misled and deceived by the outward appearance of a serious Government, by a marvelous exercise in camouflage, by a flood of promises. On September 4, 1984, people across Canada finally realized it was time to hand the reins of power to a more responsible party that would not be
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afraid to bring this country's economy back to economic liberalism, and to focus on private enterprise and job creation.
The people were undeniably right, and in less than one year, our Government was able to restore the confidence of the people in their Government. However, Mr. Speaker, our Government did not mislead the people by telling them it would be easy. It did not claim, as some politicians do, often with a lot of political rhetoric, that all we need would be some legislation that would pay off in the next election. No, Mr. Speaker. By electing this Government, Canadians were putting common sense back into Government, and in doing so, they fully realized that they would have to do their share to help industry get back on its feet, a sector the previous Government preferred to ignore.
Mr. Speaker, as you know, Hon. Members opposite see confidence as an indispensable stimulus for democratic and capitalist societies, for societies that are creative and innovative. A man who is afraid of tomorrow, Mr. Speaker, is only happy in the security of the status quo, and he does not evolve. For fifteen years, Canadians have been kept in a state of non-confidence in the future, and they could no longer create or take risks or invent as they had before.
My colleagues in the Progressive Conservative Party and 1 are no longer interested in blaming the current situation on the previous Government, but in showing that one can achieve anything when one has both knowledge and confidence. We can go from a situation which is far from enviable to an environment which could be promising indeed.
Mr. Speaker, that is what we are doing now. Canadians have renewed confidence, as demontrated by various indicators. People are investing again, thereby creating hundreds of thousands of new jobs. Our trade unions, provincial Governments, and all economic agents generally are working together again, dialoguing and looking forward to rebuilding our country. Such are the indicators of the Canadian economy. It has been showing increasingly more evident signs of vigor ever since our coming to power. The number of jobs has increased, interest rates have come down, investors are showing signs of renewed confidence, consumer spending is rising, prices are stable and there are fewer and fewer bankruptcies. Moreover, the performance of our economy is superior to that of the United States.
Employmentwise, Mr. Speaker, we have created 304,000 new jobs over the past year. The unemployment figure, which was 11.6 per cent, is now down to 10.1 per cent. This is not yet excellent, but I suggest this shows a definite improvement and a very positive trend which should be emphasized.
Mr. Speaker, the era of arrogance and darkness has finally ended. We all know now that by working together, we will rebuild what others have demolished. We all know also that this will require the joint effort of all Canadians, but we are ready to pay the price for our own good and that of future generations of Canadians.
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In fact, when 1 adhered to this party and this Government, 1 was fully aware that I was getting involved with all other Canadians in a national effort to reestablish a climate of confidence.
Knowing full well that Canada absolutely needs to replenish its coffers, that it is back on the right track, and that we are about to shelve 15 years of poor performance, we must continue without sparing our efforts. Because of his trust in the support and good sense of the Canadian people, the Minister of Finance moved ahead in May and introduced a new budget. Three of every four measures in this budget were aimed at reducing expenditures. Bill C-80, which has now reached 2nd reading, will increase our revenues by $2.5 billion.
The purpose of this legislation, which should have been adopted a long time ago but which was not for some dark election-oriented reason, is to increase the sales tax base, leaving about 30 per cent of commodities which could be taxed on the federal level. This sales tax, as we all know, is one of the Government's main source of income. However, throughout the years a very long list of tax-free products has kept getting longer and longer, thus depriving the Government of Canada of massive revenues which would have allowed us to reduce the deficit and promote confidence. We are now proposing that those products be no longer tax-free.
Mr. Speaker, once again this Government having succeeded, thanks to its sincere and honest attitude, in dispelling strains and easing the situation in economic, social and political sectors; having succeeded in restoring confidence and thus lowering the unemployment rate; having succeeded in replacing workers' assistance and meaningless programs with programs stimulating effort and the will to learn; having succeeded in reducing interest rates which are a burden for millions of heads of families, because the previous Government had not found anything better to control inflation than raising interest rates, we are asking Canadians to let us carry on with what we have so well started and to give us the means to do it.
Before concluding my comments, Mr. Speaker, I should like to refer to the 2nd Annual Report of the Economic Council of Canada on economic forecasts and this is what its chairman, Mr. David Slater stated: "Economic forecasts for Canada are gradually improving and indicate a stable growth in the medium term. The Gross National Product could increase by an average of 3.5 per cent during the next decade and the inflation rate would be around 4 per cent per year as of 1990 and would fall to a lower level during the following five years."
The Economic Council of Canada expects that unemployment will decrease gradually to an average of 9 per cent between 1985 and 1990 and to 7.6 per cent during the following five years. Our federal deficit will continue to decrease in proportion to our Gross National Product. I think

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that it is quite an encouraging indication provided by the Economic Council of Canada.
We are now asking the Canadian people to support Bill C-80 now before this House in order to proceed with our economic revival and to reduce the deficit. It is not easy, Mr. Speaker, but we must do so if we want our economy to become healthier.


Mr. Keith Penner (Cochrane-Superior):: Mr. Speaker, I find it rather strange and somewhat disquieting to be debating Bill C-80, which introduces some very unfair tax measures which make no economic sense, and to be doing so under the guillotine. Closure has a purpose and validity in our Standing Orders, Mr. Speaker, as all Members of Parliament know, but I doubt very much whether it has validity when the Party in power has such a massive majority. I doubt whether the Canadian people would agree that a closure motion is justified when there is a huge majority on the government side and a small Opposition. Mind you, this small Opposition has proven to be very vigorous and very effective. If any Members have failed to comprehend that, they need only ask the senior citizens of the country how, when we combined forces with them, we were able to cause the Government to retreat from a mean and vindictive reduction of senior citizens' pensions.
However, I doubt whether closure has any validity on a tax grab Bill such as C-80. We all know that the sales tax is regressive. It hurts most those who can least afford to lose those extra precious dollars. It increases the Consumer Price Index. I suppose we have become lethargic about inflation, but it is still with us and it concerns most those who have the fewest dollars to spend. It is into the pockets of those people that we are reaching with these petty tax grabs which make no economic sense at all.
For example, we are going to add another tax on gasoline. In the region of the country from which I come, Mr. Speaker, gasoline is already too expensive. In fact, we pay the highest price for gasoline in the country apart from that paid in the far north. We pay much more than motorists pay elsewhere and it is hurting our tourist industry. I really wonder how the Members from northern Ontario who sit on the Government side could allow this additional tax on gasoline to be introduced through a Bill such as C-80. How do the Member for Timis-kaming (Mr. MacDougal!) and the Member for Timmins-Chapleau (Mr. Gervais) justify to their constituents a higher tax on gasoline?
I see that the Hon. Member for Timmins-Chapleau is present in the House today. He indicated recently that he wants to be my partner. He wants to work with me for a better deal for northern Ontario. He indicated that he has much greater access to Cabinet Ministers. I rejected his offer of a partnership, Mr. Speaker. I said: "Thanks, but no thanks". I want to confess that perhaps I was just a bit hasty. I would like to reconsider that offer. I would like the Member for Timmins-Chapleau to prove to me, to his constituents and to my
constituents that he can do something about this tax on gasoline. Can he get the Minister of Finance (Mr. Wilson) to roll back this increased tax on gasoline? If he can, perhaps I will reconsider his offer of a partnership. After all, I recognize that we are not here to serve our political Parties, but to serve our constituents. If we can get this tax rolled back, perhaps the Member for Timmins-Chapleau and myself can join forces and get a better deal for northern Ontario from the Government which has already done so much to downgrade this region with regard to job creation programs and regional development programs. So much has been done in such a short time to undo the good work of the previous Liberal administration in northern Ontario.
Let us talk for a moment about the increase in the price of gasoline. If one includes the increase in the general excise tax plus the higher gasoline price, it means that the price of gasoline will rise by approximately 4 per cent. According to the figures from the Tourism Industry Association, a 4 per cent fuel price increase translates into 900,000 fewer American visitors coming to Canada. The Member for Timmins-Chapleau knows that many of those visitors come to northern Ontario and that we want more of them.
On a typical day a visitor may spend about $82. The multiplier effect for every dollar is approximately $1.79. Therefore we can come to the conclusion that this increase in the price of gasoline will cost our economy, in tourism dollars, approximately $135 million. That is why I say it is an unfair tax that makes no economic sense. Furthermore, about 5,325 tourism jobs will be lost.
I do not know what happened in Cabinet when this issue came up but I must believe that the Minister of State for Tourism (Mr. Murta) must have fought like a mad dog against that increase. He must have dug in his heels to say to his colleagues in Cabinet: "No way will I allow that kind of an increase. It hurts my national constituency. I am fighting for the tourist industry in this country and will not let that happen". The Minister for International Trade (Mr. Kelleher) from Sault Ste. Marie must have been right there to give his support to the Minister of State for Tourism. When this issue came up in caucus I imagine the Member for Timiskaming and the Member for Timmins-Chapleau must have joined forces with those two Ministers to stop this tax increase, but to no avail.
We will feel the effects of this on the economy of northern Ontario because Members from northern Ontario will know that the forest industry has stabilized and is not creating any new jobs. Pulp prices are depressed. There is no expanding market so that we cannot look to forestry for new jobs. We are holding our own, but not growing.
Mining is in a depressed state, except for gold, so that we cannot look for any hope there unless international metal prices suddenly show a significant increase. We know that the market for metals is saturated so that we cannot look to that industry to produce jobs.
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Tourism is the sector which can provide jobs and encourage the economy of a region like northern Ontario. However, the Government has slapped on an additional tax that will affect our tourist industry which is already having difficulty matching costs in the United States for such things as fuel, accommodation and liquor. This increase in tax will add to an already intolerable situation.
Bill C-80 is a series of unfair taxes that make no economic sense at all. Let me give another illustration. Canadians should be aware that, incredibly, Bill C-80 will tax alternative energy and energy conservation equipment. Let me cite some of those items which will be taxed at the 11 per cent level, beginning January 1 next year: heat recovery units and devices for extracting heat from exhaust air or waste water for recovery of energy; solar panels and tubes for collecting and converting solar energy; wood-burning stoves and space heaters. The following items will be taxed at 7 per cent construction rate: heat pumps in permanent heating systems; wrapping material and thermal insulation designed for pipes and ducts in buildings and mechanical systems; loading dock seals and shelters.
The measures being imposed in Bill C-80 will not result in any great tax revenue to the Government but will discourage Canadians from improving the efficiency with which they use energy.
Because Bill C-80 imposes unfair taxes and makes no economic sense, the Government, being very embarrassed about it, imposes time allocation. I have said that there is a proper moment, with certain Bills, to use time allocation. However, this is not one of those Bills.
Let us see how Bill C-80 will affect the construction industry. There are hundreds of small and medium sized construction companies which will see their profit margins cut to the bone. They will be forced to absorb a new 6 per cent tax on construction materials which will place them in difficulty because many of these contractors are on a fixed contract and cannot adjust their contracts to meet this new tax. Therefore, the profit margin is lost.
One modest and very practical suggestion was that the tax be phased in to take account of the fixed price contracts. However, the Government ignored that suggestion.
When this Budget measure is added to other Government measures such as higher fuel costs, CMHC cut-backs and the elimination of the Registered Home Ownership Savings Plan, it will add up to a very heavy blow to the industry at a critical time when it was beginning to recover. That industry will be cut back as a result of these unfair taxes that make no economic sense at all.
Even the children will not be spared. There will be an unfair tax increase on chewing gum, candy and pet food. It makes no economic sense at all.


The Acting Speaker (Mr. Charest):: 1 regret to interrupt the Hon. Member but the time allocated to him has now expired.


Mr. Dave Nickerson (Western Arctic):: Mr. Speaker, I had not intended to speak on this matter but having heard the
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presentation by the Hon. Member for Cochrane-Superior (Mr. Penner), I cannot restrain myself from saying just a few words.
The Hon. Member is one who presents himself as a very reasonable person. In fact, he has a reputation for that and, in the past, it has been a well deserved reputation for reasonableness. However, he has thrown it all away today. 1 never heard such a blatant partisan argument as that presented by him today. There was not one iota of reason contained therein.
He argued that during the time of the Liberal Government it was acceptable to impose closure time and time again as a regular means of operation because there were more Members in the opposition. He went on to state that today that process, which is permitted in the Standing Orders of the House, should not be used because there are slightly fewer Members in the Opposition. That makes no sense because it is a well known fact that a small number of Members in the Opposition, by introducing amendment after amendment and recycling speakers, can tie up House business on a filibuster just as well as if there were another 30 or 40 Members. There is no difference when there is an opportunity to recycle speakers.
Unfortunately, the tactics that have been used by the present Opposition are precisely that. Their sole strategy appears to be to tie up the work of Parliament because they have no alternative policies to put forward. They have no real logical arguments to make that would propose better legislation. They are simply tying up Parliament and doing the Canadian people no benefit whatsoever by that type of tactic. They are forcing the Government to use these provisions in the Standing Orders.
I would agree to a certain extent with the Hon. Member for Cochrane-Superior that this is not the right way of proceeding. I understand that other Parliaments throughout the Commonwealth have developed a better system. Why is it not possible for us to use existing Standing Orders to allow the various Parties to decide how to deal with a measure such as Bill C-80? Everyone knows that it will be passed into law at some point because it is necessary legislation. This Bill is worth four or five days of debate and the Parties could sit down to organize such a debate and come to an agreement so that we do not have to use the time allocation system constantly. We certainly need a better system than that.
The Bill before us provides a means of raising the revenue for expenses that the Government will incur. These expenses include the old age pension. This again was referred to in the speech of the Hon. Member for Cochrane-Superior. He was condemning this legislation and at the same time praising his own Party's position concerning the old age pension.
If we are to have indexed old age pensions, it will cost hundreds and hundreds of millions of dollars. The Government cannot give something it does not first take away from somebody else. You cannot argue, on the one hand, for higher old age pensions, Mr. Speaker, and then, when the tax bill comes in to pay for it, say: "No, no, we should not raise that additional revenue". Anybody of a sound mind has to realize

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that if you want something, you have to pay for it. You cannot be like a child and say: "We want this and this". One cannot say, "We want more and more," as the Opposition says, and then when the time comes to pay say, "No, we are not prepared to pay for it."
If the public is to have any confidence in Parliament and any confidence in the Opposition-and what little bit the Opposition has in gradually slipping away-one has to take that sensible, reasonable and logical position and know one has to pay for anything given away by Government.
Regarding the sales tax, it is very easy to score political points by saying that any particular item should be exempt from sales tax, such as children's candy, for example. Who wants to put a tax on children's candy? Let us select another item, medical supplies, for instance. One hears: "We don't want to put a tax on that". You can come up with an argument on just about any single item as to why should not be taxed. It does not matter whether it is a cup of coffee, a cubic yard of cement, or whatever. You can always think of good arguments to exclude a specific item. If we allow ourselves to be persuaded by those who would argue that there should not be a tax levied on a particular item, one would find that the sales tax base would decrease, and on those items still taxed, the taxes would be horrendous in order to raise necessary moneys for other things.
What this Government has been trying to do is to be fair and say that everything, as much as possible, should be included in the tax base, so as to have as low an over-all rate as possible. Not only that, you have much less administration if you do not have special rates for special items or exclusions. Sometimes you exclude one thing that is substituted by something else, which creates a terrible administrative problem as the Minister of National Revenue (Mr. MacKay) can well describe.
As a final point, Mr. Speaker, I want to say a good thing about the Bill in that it extends the right of appeal and the right not to pay taxes until-if you want to dispute the tax levied-the matter has been decided by a court of law. Another good thing is to extend the provisions which were recently incorporated with respect to income taxes-those provisions which were included in the Progressive Conservative taxpayers' bill of rights-to excise and sales tax matters. That is certainly a step in the right direction.
Thank you for the opportunity, Sir, to refute some of the remarks made by my good friend and colleague from Cochrane-Superior.


Mr. Rod Murphy (Churchill):: Mr. Speaker, when speaking on this legislation with the threat of time allocation hanging over our heads, it is important to remember that time allocation is getting to be a consistent policy of the Government. The Conservative Party, now in Government, used to oppose time allocation when it was in opposition. Yet we are in the ironical situation that on almost every piece of legislation coming to the House at present the Government is preventing full debate.


Mr. Epp (Thunder Bay-Nipigon):: Shameful.


Rodney Edward Murphy: One of my colleagues calls it shameful. I am not allowed to say that it is hypocritical because that is not allowed by the rules of the House, but it is something close to hypocritical when you do one thing in opposition and the exact opposite when in government.
Tax policy is one of the very areas on which the House of Commons should be spending a fair amount of time. It is evident from the Auditor General's Report that we, as the watchdogs of the Government purse and as the people who are passing legislation resulting in tax increases, are not doing a very effective job. Much of that is because we are not getting the information we need from the Government, whether the present Conservative Government or the previous Liberal Government. In addition, the whole structure in a lot of these debates does not allow for the real investigation necessary, something we will have to look at in terms of Parliament itself.
By bringing in time allocation on this Bill and forcing it through the House later today, the Government is preventing us from moving in the direction which the Auditor General called for in his report last week.
We are also rushing this piece of legislation through which will increase taxes, hidden taxes for the most part, on Canadians without any real study of alternatives and without any real attempt by the Government to look at tax reform.
There is no introduction of a minimum tax for the rich. There is no change in the corporation tax. There is no concept of fairer taxation. What we have is a minor series of amendments which will add to the tax bill of ordinary Canadians. As my colleague, the Hon. Member for Cochrane-Superior (Mr. Penner) pointed out, in some cases that will especially hurt people from northern regions because higher gas, oil and aviation taxes increase the cost of living in those regions. Yet here we are rushing a Bill through the House with no consideration as to how it will affect people in northern Ontario, the Northwest Territories or northern Manitoba.
In September, 1984, Canadians did vote for a change. They wanted to see their Government open things up. Canadians wanted to see some type of fair taxation system introduced. Yet much of this legislation before us today has been introduced by previous Liberal Governments. It is the same system. All we see is percentages increased by 1 per cent here or 2 per cent there to increase the revenue to the federal Government.
I object to the quick passage of this Bill without any chance for public input, without any chance for a study as to how taxes should be raised and where the money should come from. At the same time, the Government is constantly spending. We have seen a billion dollars go in tax write-offs for the Gulf deal, another billion dollars went into the tax write-off in the Dome deal, and we have seen another piece of legislation rushed through the House for a billion dollar bank bail-out. The Government is spending billions upon billions on tax write-offs and in bank bail-out money, yet it says it needs to increase the money collected from ordinary Canadians.
If you have these bail-outs and give money away or refuse to take money owing to the Government of Canada on various oil
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company deals, and if you are to give something like $9 billion to the oil industry as a result of the May 23 Budget, you will have to increase taxes and take away money from the taxpayers, people who will not benefit from the billion dollar bail-outs.
Worse than that, Mr. Speaker, some of the other things the Government is doing indicate there is no sense of fair taxation. The Conservative Government is to continue along the same trail which Liberal Governments followed in the past.
Let met quote from a speech made by the Minister of Finance (Mr. Wilson) to the Canadian Tax Foundation in November, 1984 when he said:
Our recent figures indicate that the effect of tax incentives has been to reduce the average federal corporate income tax rate from 36 per cent to 15 per cent. . . Particular activities qualify for very high rates of incentives, especially under certain grant programs. When the benefits from special tax incentives are added we are looking, in some cases, at an extraordinary generous level of assistance.
Those were the words of the Minister of Finance when he spoke in November, 1984. However, what did he do in May, 1985? He added on a capital gains tax-free amount of $500,000 per individual. We know that that will not benefit someone earning $10,000 or $15,000 per year. It will not help most farmers in western Canada. It will not help people working in the mines or in the forest industry. It will not help people living on a minimum wage or the people who are seeing their family allowances cut back by the Government. What the Minister is saying is that we have a very generous system at the present time and that the corporate income tax rate went from 36 per cent to 15 per cent prior to the introduction of his Budget. The situation is becoming worse in that corporate taxes will produce less money for Canadians. Those people at the top level of income will be paying less for the services which all Canadians require. At the same time, those people who are working on farms, earning a wage or earning a salary will be paying more and more of their take-home pay to the coffers of the federal Government. It is not fair. It goes in the opposite direction to fairness.
While I have the floor, and because we are talking about the raising of tax money, I should like to talk about how money will not go to the provinces in the future. In the Budget we were told that by 1990 the federal Government hoped to reduce the amount of transfer payments to the provinces by $2 billion per year. That is a lot of money. That money is used for medicare, post-secondary education and to help provide the services of the provinces to ordinary citizens. By increasing taxes at the federal level, and by decreasing the amount of money going to the provinces from the amount required under the present legislation, it will be more and more difficult for the provinces to be able to provide their services. Money is being taken away from the provinces. The taxes paid by ordinary citizens are being increased. The federal Government is saying that it is broke, that it cannot afford to provide those services, and that it is up to the provinces to do it. Again I say that that is unfair. It indicates that the Government does not
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have a tax fairness policy and that it does not really consult with the provinces before it takes action.
In speaking about the cut-back in transfer payments, it is interesting to note that last month, in Halifax, the Minister of Finance indicated that he was planning to keep the threat in the May 23 Budget of reducing transfer payments by $2 billion per year by 1990. He also indicated that he would change the present legislation and bring in those cut-backs one year earlier, so that by April 1, 1986, the provinces will be getting approximately $400 million less next year than they would under the present legislation. The Minister of Finance made that threat in a meeting with provincial Finance Ministers in Halifax. He finally admitted it in the House of Commons, but he will not come clean on the actual figures involved. He will not tell the people of Nova Scotia or the people of New Brunswick how much less they will be receiving in transfer payments next year. He will not tell the people of Quebec, Manitoba and Saskatchewan how much less they will be receiving. In fact, he will not tell the people of Canada what the Government is doing.
At the present time, the Conservative Government is increasing the taxes which people will have to pay, as well as the costs of various goods and services, but it will not tell them its plans for next year. Their taxes will be increased, but there is no indication of what the Government will do to ordinary Canadians.
I think that is what upsets so many of us in the House and people right across the country. The new Conservative Government is acting much like the Government which the people of Canada voted out in September, 1984.
I suspect that my time is almost up, but in closing I should like to indicate that the people of Canada wanted a change. They wanted Government to become more open with its population. I see a Conservative Member sitting silently across the way. When he was in opposition to Government, he used to be active in opposing time allocation. He used to be very upset about the closed nature of past Liberal Governments and about tax increases. Now he sits there, allowing time allocation to take place day after day, allowing tax increases which affect ordinary Canadians and allowing the Government to cut back on transfer payments. Similarly, when the Minister of Finance and the Minister of National Health and Welfare (Mr. Epp) were in opposition, they used to oppose cut-backs in services to the provinces. Perhaps the Hon. Member for Simcoe North (Mr. Lewis) typifies what is wrong with the Conservative Government.


Mr. Aurele Gervais (Timmins-Chapleau):: Mr. Speaker, I am pleased to have the opportunity to participate in the debate on Bill C-80 and to answer the Hon. Member for Cochrane-Superior (Mr. Penner). During the last week, I was singled out twice by that Hon. Member when I really do not believe he knew what he was talking about. He talked about a partnership into which he presumed I wanted to enter with him.
However, before speaking about the partnership, I should like to make a couple of comments about the Hon. Member

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himself. In my days in the municipal field, I had the opportunity to work with the Hon. Member for a number of years. He has done good work for northern Ontario. He must have lost his cool now that he is in opposition, because he is saying things and doing things which are not very characteristic of him. Certainly he was not trying to be complimentary to me when he spoke on both those occasions. However, I say again that I got along well with the Hon. Member in days gone by.
The partnership proposition was proposed, not with the Hon. Member, but with an association in Cochrane-Superior. With all due respect to him, I do not think I would like to enter into a partnership with an Hon. Member who represents a Government which brought in the National Energy Program, FIRA, and the MacEachen Budget. I think the feeling is mutual. I do not think I would want to be in partnership with a Member representing such a Government. However, I want to enter into an agreement with an association in Cochrane-Superior because we can do a number of things.
I live in northern Ontario. I return to my riding once per week. I spend a lot of time there. That is more than I can say for the Hon. Member for Cochrane-Superior. He lives in Ottawa.


Mr. Nystrom:: Are you a nice guy?


Aurèle Gervais: He might say that he has a residence there, but he is normally in Ottawa.


B. Keith Penner: Mr. Speaker, I rise on a point of order. I am not sure if the Hon. Member is delivering his maiden speech, in which case he should be given the widest possible latitude and be allowed to express whatever views may be burdening his soul and his mind. However, if this is not his maiden speech and the general courtesies of the House are not extended to the Hon. Member, then I suggest that you, Mr. Speaker, direct the Hon. Member for Timmins-Chapleau to confine his remarks to Bill C-80. The House and his constituents are anxiously awaiting his views on Bill C-80.


The Acting Speaker (Mr. Charest):: Order, please. The Hon. Member for Cochrane-Superior (Mr. Penner) has well argued his case. I may point out to all Hon. Members that we are addressing Bill C-80 at this point in time. This would apply to all Members of the House, including the Hon. Member who rose to speak. We may bear that in mind while debating this Bill.


Aurèle Gervais: Thank you, Mr. Speaker. The reason I was making these comments is that 1 was singled out by the Hon. Member twice.


Some Hon. Members:: Shame.


Aurèle Gervais: I just wanted to explain the facts to the Hon. Member.
Let us talk about Bill C-80. Let us talk about increases in gasoline prices. Back in 1980, the Conservative Government
was brought down by the Liberals and the NDP because at that time we had proposed to increase the price of a gallon of gasoline by 18 cents. The record of the next three or four years when the Liberals were back in power shows that the price of gasoline did not increase by 18 cents per gallon but it increased by $1.28 per gallon. I would ask the Hon. Member who singled me out twice where he was when the price of gasoline went up by $1.28 per gallon. He just finished asking me where I was when Bill C-80 was proposed. Where was my hon. friend during the three years the price of gasoline rose by $1.28 per gallon?
I can tell the Hon. Member where 1 was and what I was doing in the federal caucus and the northern Ontario caucus at the time. I was helping my colleagues formulate a policy that has increased employment in Canada by 304,000 jobs in the last year.


Some Hon. Members:: Hear, hear!


Aurèle Gervais: I was working with my colleagues creating a policy that brought down interest rates to 8.85 per cent, the lowest they have been in seven years. What were interest rates when my colleague was supposed to be fighting for things of that nature?
I was working with my colleagues setting a policy that created an increase of 13 per cent in the manufacturing sector since September 1984. I was working with my colleagues introducing policy which became part of the Western Accord, an Accord which, in its first eight months, increased drilling activities in Canada by 19 per cent. That is where I was.
1 was also working with my colleagues introducing policy that reduced bankruptcies in Canada by 13 per cent.


Mr. Gauthier:: What about the three banks?


Aurèle Gervais: Yes, we were also working on the bank failures that were brought about by the policies of the previous Government. For the benefit of my hon. friend, that is what I was doing. I have been working on these matters of policy of which I am very proud.


Mr. Jacques Guilbault (Saint-Jacques):: Unlike the Hon. Member who just resumed his seat, Mr. Speaker, I shall endeavour to relate my remarks to the thrust of Bill C-80. The Government was practically forced to invoke closure-time allocation-because the Opposition has not softened its unrelenting attack against the Bill, and it is imperative that we explain our approach.
Among the major arguments in favour of this measure, one in particular was raised earlier when the Hon. Member for Jonquiere (Mr. Blackburn) took the floor of the House. Referring to the kind of taxes and levies proposed in Bill C-80, he said they are intended to offset the erosion of the sales tax base. In other words, according to the Hon. Member for Jonquiere and some of his Progressive Conservative colleagues,
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the purpose of this measure is to properly restore the sales tax within the Canadian tax structure.
That is where the Progressive Conservative Party and we in the Opposition have diverging views, Mr. Speaker. In our judgment, increasing the sales tax is a regressive step and we believe that the Government is not proceeding correctly to collect taxes. That is why we are against the Bill.
We agree that the Government should try to collect more money to provide better services to the people or perhaps to control the deficit, for those are commendable goals. What we are telling the Government is that it is trying to get the money from the wrong people. Its attack is directed against those who can least afford to pay. It is acting at the expense of low wage earners while continuing to protect its high income friends. For example, we figured out that, according to the forecasts, revenues generated by these new taxes in fiscal year 1985-86 will bring an additional $1,205 billion in Government coffers. However, 88 per cent of those revenues are regressive taxes. Among others, the gasoline tax will hit rich and poor people alike; the tax on alcohol-incidentally, there is nothing wrong with taxing bad habits-will produce only $15 million, but here again everybody will pay the shot; the tax on tobacco may prove to be a blessing in disguise if people end up smoking less, but again the Government will take $220 million out of our pockets regardless of incomes. The higher sales tax will account for $80 million more and, by widening the tax base, the Government will siphon off another $275 million.
That will do for examples, but what I am proving is that most of the new funds collected through this tax-88 per cent-will come from all taxpayers regardless of their income. As a result, a poor family will have to shell out $128 more this fiscal year, or 1.39 per cent of its total income. The $50,000-income family, much better off, will pay more in absolute figures, $547, but it will still amount to only 0.69 per cent of its higher income. To put it another way, poorer people will be expected to pay proportionally twice as much as wealthy Canadians, and that is where we draw the line.
I am not the only one who went through these tables and discovered that inequity. I can quote for instance the National Organization against Property, which had this to say according to the headline in the newspaper Le Droit of October 30, 1985: "Poor families will be twice as much affected as rich families by the increase in sales and excise tax proposed by the Tory Government". There is the problem. The Government is trying to get additional tax money, and this we do not oppose in principle, but it is plucking that money from the pockets of those who are the least in a position to defend themselves. Besides, this sales tax is a concealed, a hidden tax that nobody sees. If the Government on the other hand had chosen to increase taxes in a progressive way, it would have amended the income tax tables so that an extra effort would be made by
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high income groups to help increase Government revenues. But no, this is not what they are doing. They are asking everybody to pay, and the poor are asked proportionately twice as much as the rich! This is what we feel is unacceptable! This is why we are holding up the debate in the House of Commons. This is why we will fight this measure to the end, because it is fundamentally unfair.
As I said, this is a hidden tax. The federal sales tax is not like a provincial retail tax that is added on the invoice when consumers buy goods in the store. It is a tax that will be already included in the price tag. This is why people do not see it. It is a hypocritical way of collecting revenue especially as 1 said from the pockets of those who can the least afford to pay.
Meanwhile, the Government is proposing on the one hand to deliver a $500,000 handout, by increasing capital gains exemptions. It is interesting to note that with Bill C-80, the Government will tax the small people while with another legislation soon to be introduced, it will help those who make capital gains, those who are relatively well off in our society.
Let us also consider the Government's tax expenditures over the coming years in the sole area of existing capital gains exemptions, quite apart from the $500,000 handout the Government is getting ready to extend to people with higher income. I am referring to forecasts made by officials, for instance, on capital gains exemptions. These officials say that because of the increased use of such tax loopholes the Government would lose during the 1985-86 fiscal year something like $300 million more in tax revenues than it is already losing. And over the following fiscal year 1986-87, that amount would be $600 million. Finally, during fiscal year 1990-91, the forecasts indicate $1.25 billion. This means that the system set up by our friends opposite is aimed at helping, assisting high income groups, by switching the burden to those who already find it difficult to make ends meet.
The gas tax, for instance, is affecting everybody, even the taxpayer working at the minimum rate who has to use his car to commute. Even if he takes the bus, public transportation, he will suffer because the gas tax increase sooner or later will be passed on to him via his bus fares. This means it hits everyone, and the hardest hit are those who have the lowest income, because high-income groups could not care less if the costs of gas increases slightly. And speaking of the increased gas cost, let us look at the blind of judgment and meanness with which the Minister of Finance (Mr. Wilson) went about that: on the one hand, and this has been raised in this House by my colleague for Davenport (Mr. Caccia) who sits to my left, and thank God he pointed this out to the Minister of Environment (Mr. McMillan)-the tax increase on regular gas will be less than the increase on lead-free gas. So this measure, is regressive not only in respect of low income taxpayers, but also in respect of environment protection. In fact, the tax on leaded gas will increase by .32 cents a litre, while the tax on lead-free gas will be higher, at .35 cents a litre.

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So what we have in Bill C-80 is a tax package that is ill conceived, that plucks the money the wrong people. And this is why the Opposition is fighting it so vigorously for the reason again, not that we feel the Government has no need for extra revenues to manage public business, because clearly it does- but good Lord, when will this Government try and understand it has not been elected to help the affluent and penalize the poor, but to try and maintain the kind of social justice that existed in this land before September 4, 1984! This is the reason why we are opposing Bill C-80, Mr. Speaker.


Mr. Vic Althouse (Humboldt-Lake Centre):: Mr. Speaker, 1 rise today to speak against Bill C-80, an Act to amend the Excise Tax Act and the Excise Act. What we are dealing with in this Bill is $3.5 billion of extra tax money which the Government proposes to collect from taxpayers to the end of the next fiscal year 1986-87. As is typical with most Government legislation, and it was typical of the Liberal legislation, there is a bit of good news contained in the Bill. There is a minor clause which states that the treatment of the people who are collecting these excise taxes will be more in line with the recent changes to the Income Tax Act. This means that the power of search and seizure will be lessened. The Department of National Revenue will grant the person who is suspected of withholding taxes improperly the right to make a case for himself or herself and present that case before funds are actually seized from the person's bank account. This is a positive step. It gives taxpayers and the person collecting taxes on behalf of the Government for Revenue Canada some rights which were not in place before. I mention this clause because it contains good news. The rest of the few minutes which 1 have to speak today on this subject will be with respect to the bad news.
The bad news is that the tax rates which people in Canada have to pay will be going up. Because these are excise taxes and are geared to people who are spending money for consumer goods the load will tend to fall more heavily on lower income people than it will on higher income people. For that reason they should be designated as regressive taxes because they hurt people with average and low incomes far more than they hurt people with higher incomes. The reason for this is quite obvious when one starts going through the list of taxes.
We can see that one of the first tax measures mentioned in the Bill is an increase of 1 per cent effective January 1, 1986, which will be levied on construction materials. There will be additional taxes on cable and pay television services of 7 per cent. There will be a 14 per cent increase on alcoholic beverages and tobacco products and an 11 per cent increase on all other taxable goods. The other taxable goods category includes some items which were not included before. These are items which were exempt from sales taxes previously, such as candy which children buy, soft drinks, pet foods and certain health goods. An 11 per cent tax will be imposed on these items bringing the total cost to consumers up to $990 million- almost $1 billion. That is almost enough to pay for the recent bank bail-out.
Energy conservation equipment did not previously attract any excise tax at all. Taxes will now be imposed on this equipment on the same basis as other consumer items, which raises the question of just how serious the Government is about conservation. The total cost to Canadian consumers in the next fiscal year from these changes, including getting pet owners and children involved in the tax system, will be $785 million. As well, there is a tax increase which farmers have already noticed to their chagrin, that is the excise taxes on fuels. The excise tax went up 2 cents a litre on gasoline, diesel and aviation fuel on September 3. That works out to 9 cents a gallon for those using the other system of measurement. Effective January 1, those taxes will increase another cent per litre. This will collect one and a third billion dollars more taxes in the next fiscal year and will go some way toward paying off the taxes which Dome Petroleum did not pay last year because of its ability to avoid paying taxes. Ordinary farmers and consumers who use gasoline and diesel fuel will make up that loss by paying more at the pump. Smokers and users of alcohol will be paying their 14 per cent as well. Taxes on cigarettes, for instance, will go up by about 1 cent per cigarette.
* (1220)
The proposals in the Budget and in some of the speeches leading up to the Budget, did not make Canadians generally aware that this was going to happen. In a speech made to the Canadian Tax Foundation on November 28 of last year, the Minister of Finance (Mr. Wilson) stated that the real bottom line of any tax system is people, how it will affect people. We found out after the first Budget how this tax system will affect ordinary people. They will be paying about $3.5 billion more in taxes this year than they did last year. In the same speech, the Minister of Finance left the impression that there was going to be some levelling out of the tax system. During the election campaign there was concern expressed by all Parties, including the Conservative Party, that the tax system was inequitable, that the very rich were not paying their share and that people with lower incomes were paying a far higher burden of taxation than were the corporate citizens and those with high incomes. The Minister of Finance pointed out in that speech to the Canadian Tax Foundation, and 1 quote:
Our recent figures indicate that the effect of tax incentives has been to reduce the average federal corporate income tax rate from 36 per cent to 15 per cent-
He was speaking about some of the fast tax write-offs which are permitted under the tax law, which are not being changed, and he alluded to the R and D rip-off which did finally get stopped. He referred to such things as what is known in tax circles as the "little Egypt bump" which is still going on and which allowed Olympia & York in its acquisition of Gulf, and Dome Petroleum, to avoid between the two of them $1.5 billion worth of taxes. When we put that together with some of the recent reports of what the bank bail-outs will cost the Government of Canada, we arrive at a total of approximately $3.5 billion in taxes which the Government is proposing to collect in the form of excise taxes from ordinary Canadians. One can see very quickly why those of us in medium and low
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income brackets will have to carry the tax bill for these decisions made by the Government.
In conclusion, I will reiterate that we will be opposing this Bill. We believe it continues an unfair tax system and has not addressed any of the real problems which exist in the collection of tax in this country.


Mr. John Gormley (The Battlefords-Meadow Lake):: Mr. Speaker, I am pleased to have this opportunity to address a few thoughts and comments on Bill C-80, particularly at this stage of debate, on what this Bill proposes and, interestingly, how the Opposition Parties have been dealing with it.
Speaking in support of taxation is a little like speaking in support of borrowing Bills. It is a necessary evil and certainly gives the Opposition Members plenty of things to place in their canons. However, as we approach this particular Bill and what the Budget calls for and envisions, I believe we should perhaps ask the Opposition, and those who have spoken so strongly and vociferously against the measure, what they would do. In the spirit of partisanship-and it is as partisan as I will ever get- I would ask the Hon. Member for Humboldt-Lake Centre (Mr. Althouse), or his colleague, the Hon. Member for York-ton-Melville (Mr. Nystrom), that question. I would particularly like to ask that question of the Hon. Member for Yorkton-Melville, who is aspiring to be the Leader of the New Democratic Party in Saskatchewan, although why anyone would want that job I will never know. However, the Hon. Member for Yorkton-Melville is attempting very vigorously to get that job. So I will ask the supporters of the New Democratic Party what they would do, and I believe the answer would be quite clear. They would have us live in a system which requires no fiscal responsibility or accountability. It is a system of having an economy which is completely skewered.


Victor Fredrich (Vic) Althouse: If you owe them, pay them. It doesn't matter if you are a corporation.


John Kenneth Gormley: Perhaps the Hon. Member for Humboldt-Lake Centre would let me finish without interrupting.


Victor Fredrich (Vic) Althouse: Had you listened, you would have heard $2.5 billion worth.


The Acting Speaker (Mr. Charest):: Order.


John Kenneth Gormley: Thank you, Mr. Speaker. In dealing with the depressing matter of deficit reduction, may I say that we asked Canadians what they wanted. Canadians wanted jobs and a growing economy. Mindful of this, however, they said we had to get those jobs and a growing economy at the same time that we cranked down the deficit. It is a fact of life-and I would have thought that these well worn parliamentarians would have known the figures by now-that when a country is running an annual deficit in excess of $34 billion to $35 billion, with a cumulative net debt approaching $200 billion, it is evident that the deficit is a pressing problem.
How do we address that problem? Our Government is proposing to address the deficit in a very responsible fashion.
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Eighty per cent of deficit reduction will be done by expenditure reduction, taking what exists presently and winding it down. Only 20 per cent of deficit reduction will be done by increasing taxes. I believe if we took the approach advocated by the New Democratic Party, we would have a system where there would be overwhelming tax increases just to pay for the financial recklessness these Hon. Members propose.
Let us examine the premise that the tax increases are a necessary fact of life, however unfortunate and difficult it may be to defend a tax increase. Bill C-80 proposes, in the spirit of the Budget which contains, as my colleague, the Minister of Finance (Mr. Wilson) has said, "tough but fair measures". I believe if members of the Opposition would look responsibly at this Bill, as the people of Canada have, I think they would agree that Bill C-80 is indeed an equitable and fair measure of taxation. Yes, it is tough. It broadens the tax base and increases the number of sales tax items. Hon. Members of this House will know that the previous federal sales tax exemptions on candy, confections, soft drinks, pet food, certain health goods and energy conservation equipment have now been lifted so that those items are included in a broadened tax base. Yes, this is also tough in that it increases the actual rate of federal taxation. Hon. Members will know that the federal rate of taxation is increased by 1 per cent in this measure. But these are necessary tough measures in order to try to increase the level of Government revenue in an attempt to offset the great rate of expenditure with which our Government presently has to cope because of the large deficit we have inherited.
Let us look at the fairness. Bill C-80 includes some very fair measures, one of which is a comprehensive system of assessments, objections and appeals under the Excise Tax Act, much like the present reforms our Government brought into the Income Tax Act. This new comprehensive system will incorporate improvements in the areas of search and seizure, and in the presumption of innocence, which defers collection action until the taxpayer has had an opportunity to resolve any disputes arising with respect to his or her tax liability. So there is a spirit of fairness being brought into the collection of excise tax. This is indeed a moderate and fair approach to taxation.
Being a Member from Saskatchewan, I greatly deplore the criticisms of the NDP Members from Saskatchewan of the present state of the economy and their inclusion of the capital gains exemption in that criticism. This is indeed puzzling for those of us who come from a province with 70,000 farmers whose livelihood is interwoven into what we call the family farm. As a Progressive Conservative Member of Parliament from Saskatchewan, I worked very hard to see this exemption become a reality for my constituents. Numerous small retail service businesses serve these agricultural communities and industries and, like the family farm, the business and family life are interwoven. This is a way of life. These are the people who benefit most directly and immediately from this capital gains exemption. That money can be reinvested in a way that makes the economy grow. Therefore, when the Hon. Member for Yorkton-Melville is making his very active attempt to
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become the Leader of the NDP in Saskatchewan-and I do not know why anyone would want that job-the farmers of Saskatchewan should know that this is what the NDP has been criticizing our Government for.
Look at the positive effects this Government has had on the economy. Confidence and investment in the economy are growing and the figures are there for everyone to see. 1 would be remiss if 1 did not touch briefly on those figures. Inflation is now steady at its lowest level in years. Interest rates have tumbled a full three percentage points in the months that this Party has been in Government. Investor confidence and business spending intentions are rising. Housing starts have increased an incredible 44 per cent in the past year. Some 180,000 new living units have been built. That is indeed incredible. Over 300,000 new jobs have been created. These figures show that Canada is in an economic cycle or stage which we have not seen in at least the recent memory of most young Canadians, the past seven to 10 years. These are the sort of economic indicators we have seen since this Government came into power.
This Bill arises from the Budget of May 23, and I urge Members of the Opposition to ask the question 1 asked at the outset of my remarks. Let us leave aside the political rhetoric and partisanship, which is all too rife in this place at times, and ask ourselves how we should deal with the question of our need to bring in more revenue as against the large expenditure commitments already made. How do we come to a balance in dealing with the deficit by winding down present expenditures, and deciding how much revenue to take in?
Based on the formula we have dealt with, and based on the need for this increased taxation, I believe this Bill is fair. It is sensible and will add to the economic growth of Canada. Therefore, I call on all Members of the Opposition to see that the Bill is passed and, as a measure from a sensible Budget, enacted quickly into law so that we can see Canada continue to grow and develop and this Government continue to lead Canada on the proper path of economic recovery on which we have now started.


Mr. Alfonso Gagliano (Saint-Leonard-Anjou):: Mr. Speaker, Bill C-80 will create a new class of poor, the middle-income poor. 1 was not the first one to say so; the Consumers Association of Canada said this on May 23, when the Progressive Conservative Budget was brought down.
First, Mr. Speaker, 1 would like my Government colleagues to understand that the federal sales tax is a hidden tax in the sense that the consumer will not see it on his bill because it will be included in the price. The consumer will therefore always believe that the prices have increased and that it is the fault of the small businessman or big business, even though the Government will have been responsible by increasing the sales tax.
Mr. Speaker, as for the deficit issue to which my hon. colleague has referred, I agree with him that, to reduce the deficit, we have to increase certain taxes. However, this measure is not reducing the deficit, Mr. Speaker. Just look at what we are taking from the poor, from the most disadvantaged, from the middle classes, to give to those with deposits over $60,000 in the Canadian Commercial Bank and the Northland Bank, and to the Reichmann brothers. Do these people need money? The poor, our senior citizens and the handicapped will be taxed to give something to these people.
Mr. Speaker, that is the whole difference between the Progressive Conservative Party and the Liberal Party. The Liberal Party has always believed in a just society, in raising money so that everyone benefits, but the Progressive Conservative Party is taking money from the poorest, from middle-income citizens to give to the rich who do not need it. A striking example is the construction industry. Today, even labour is being taxed. For instance, there are now two categories in the industry: If the concrete is poured on the spot, labour will not be taxed-


Jean-Pierre Blackburn: On a point of order, Mr. Speaker.


The Acting Speaker (Mr. Charest):: The Hon. Member for Jonquiere (Mr. Blackburn) on a point of order.


Jean-Pierre Blackburn: Mr. Speaker, the Hon.
Member for Saint-Leonard-Anjou (Mr. Gagliano) and the Hon. Member for Saint-Jacques (Mr. Guilbault) have both said that our Government is taking more taxes from the poor to redistribute this money to the rich, which is not true since our 1985 Budget provides that the rich will be taxed more and that someone with an income of $100,000 will contribute $1,686-


The Acting Speaker (Mr. Charest):: Order, please. I think that the Hon. Member for Jonquiere (Mr. Blackburn) is well aware that that is not a point of order, but a question of debate.


Alfonso Gagliano: As I was saying, Mr. Speaker, there is a new taxation field in the construction industry. Pre-mixed concrete is now being taxed, and we are faced with two situations. If the concrete is poured on the construction site, labour will not be taxed, but if you decide to build with pre-mixed concrete, a federal tax of 6 per cent will be charged. In announcing this measure, Mr. Speaker, there is something that the Government did not consider, which shows its incompetence and its lack of knowledge about the building industry, since we all know quite well that, in this industry, long-term contracts are signed two or three years beforehand. Last May, it was announced that a 6 per cent tax on pre-mixed concrete would apply from July 1. What happens to the contracts which had already been signed? The Government does not even respect its own commitments regarding this tax.
I have here a letter from the Canada Museums Construction Corporation which concerns a contract signed before the
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Budget, when there was no 6 per cent federal sales tax. After the Budget, the general contractor wrote to the Corporation asking them to increase his contract, and the answer he got was quite clear: There is no clause in the contract so we cannot act on your request. And now the company has to pay 6 per cent tax on a contract. Well, we all know that the profit margin on these contracts is not that high. The contracts may be big, but the profit margin is very slight. So if the contractor has to pay 6 per cent, Mr. Speaker, we are going to see a number of bankruptcies in the construction industry, a sector that needs stimulating instead of being beaten down by this kind of tax.
Mr. Speaker, 1 could mention the notorious $500,000 capital gains tax exemption. If we look at the statistics for 1982, we see that only 4 per cent of the people who declared capital gains were declaring the kind of gains from industry and businesses that really create jobs. Mr. Speaker, 96 per cent declared capital gains as a result of property transactions and sales of homes and office buildings. They know perfectly well . . . We all know that changing the ownership of a building does not create that many jobs.
Mr. Speaker, instead of saying: We want to stimulate economic recovery, we want to help small businesses invest and create jobs, the Government is giving $500,000 to everyone. With a little bit of accounting imagination, one realizes that these $500,000 could become one million or two million dollars' worth of tax exemptions. So when we say that the Government takes from the poor and people on average incomes and gives to the rich, I know it hurts my hon. colleague, but it is the truth. Obviously, people earning $20,000 per year are not going to have a capital gain of half a million. That is the whole point of this debate, and that is the difference between previous Liberal Budgets and this Progressive Conservative Budget.
I would like to quote some of the organizations which, on the night the Budget was presented, were worried about the Conservative Budget. For example, the Retail Council of Canada was disappointed that a federal sales tax of 1 per cent along with an extension of federal tax on food products was imposed as it will have the greatest impact on lower income Canadians and they will be worse off as they make up the bulk of the consumers. The Consumers Association of Canada said that the average consumer is hard hit with higher expenses, whether through expenditure cuts or increased taxes. The association said that it is hard to imagine how consumers will be encouraged to spend when the money value is reduced.
With regard to the increased consumption taxes, the British Columbia Federation of Labour said that the two-cent increase in gasoline tax to pay for the western energy agreement is a gift to the industry at the expense of the consumer. It said that a consumption tax is regressive by any standard and is a distortion of the tax system.
Excise Tax Act
The Canadian Association of Social Workers said that the Budget was bad news for the lower income population, that it hurts the poor the most and that the child benefit package is another kind of horror. With regard to the reduced child tax exemption it said that there is no indication of where the savings are going. We know that they are going to Canadians who had more than $60,000 on deposit with the Canadian Commercial Bank and to the Reichmann brothers. The Government is giving a $1 billion tax credit to the Reichmann brothers at the same time as it is closing a refinery in the east end of Montreal. The Canadian Association of Social Workers also said that it seems as if we did not care for the low income sector and that we will probably see increases in line-ups at the food banks. We have been seeing that for the past few months, Mr. Speaker.
The National Anti-Poverty Organization said that the Budget is a bad one as far as support to families, the aged and women are concerned. It said that on top of that, all the increased consumption taxes target families directly and will be hardest on those with low incomes who have topay the same for basic products as do the rest. Increased taxes on upper income earners are off-set by giveaways such as the $500,000 capital gains tax exemption. The organization said that this Budget is bizarre as it increases public assistance to those who need it least.

Mr. Speaker, you are signalling that my time has expired. Well, we could go on for quite a while about the Budget and Bill C-80. Unfortunately, our time is limited, and I hope that Canadians will understand what the debate is about today.


Mr. Sergio Marchi (York West):: Mr. Speaker, I too feel it necessary to participate this morning in the debate on Bill C-80. I feel it necessary because Bill C-80 is, on the whole, a regressive Bill. In simple, layman's terms, effective January 1, 1986 it will increase the sales tax on a wide range of products by 1 per cent. That list of products gives an indication of the regressive element of this Bill and of the mind-set of the Tory Government. It is going to increase the telecommunications programming tax by 6 to 7 per cent. It will increase excise taxes on wines. Federal sales taxes will go up from 10 per cent to 11 per cent. There will be an increase in the gas excise tax of 2 per cent per litre on September 3 and another cent per litre on January 1, 1987. There will be an imposition of sales taxes on carbonated beverages, candy, confectionery and, yes, even pet foods. There will also be a sales tax on health goods and an imposition of sales tax on energy conservation equipment as well as on previously exempt construction and building materials.
We must look at Bill C-80 not only from an economic point of view, but from a social viewpoint as well because it has a dual effect on Canadians, economic and social. On the economic front the Government promised a renewal of the economic spirit in the country. Yet, when you look at this Bill, Mr. Speaker, you have to ask where that spirit is. What kind

November 5, 1985
Excise Tax Act
of economic spirit will impose upon Canadians an increase of S2.6 billion in sales tax alone by 1991? When one couples that with the $4.1 billion increase in income tax imposed by the Budget of last year Canadians begin to ask where the spirit of economic renewal has gone. Where is the spirit of economic fairness in Bill C-80, Mr. Speaker?
It does not take an economic genius to understand that the purchasing power of average Canadians is going to be reduced. It does not take an economist to realize that companies are going to be hard pressed to sell their services and goods at a competitive price. How will this help firms in our country to be more competitive and to sell more products when they have to pass on increased taxes to the consumer?
How will construction companies be assisted by increased taxes on construction commodities and equipment? How will Canadian truckers, who compete with truckers from the United States, feel about this Bill which imposes higher taxes on fuel? How will the tourism industry, which has been lobbying the Government for the last year and a half not to impose higher taxes on gas, react to Bill C-80? How will companies in the energy conservation business react to this Bill which increases the taxes on their equipment? We are saying, on the one hand, that it is important for Canadians to conserve energy, and, on the other hand, we are increasing the taxes on the products that Canadians must purchase and have installed in their homes in order to conserve energy. You simply cannot do both, Mr. Speaker.
This legislation not only squeezes Canadian consumers by decreasing their purchasing power and increasing their taxes, but also squeezes Canadian companies. They are having a tough time as it is making ends meet without having more added to their problems. Clearly, on the economic front, this is a Bill that hits both consumers and companies at the same time.
But there is another element to this Bill that cannot be overlooked. It is its social impact and the social fairness of this particular piece of legislation.
As I mentioned at the start of my speech, I said that it was a regressive Bill. That sentiment is certainly echoed by the Canada Council on Social Development. It estimates that the combination of increased sales, gasoline, alcohol and tobacco taxes will result in tax hikes of $140 for a couple with an annual income of $15,000 in 1990; $282 for a comparable couple with an income of $20,000; and $361 for a couple with an income of $40,000.
We must begin looking at the social equity in this legislation as well. While Canadians will be paying more than $2.6 billion in sales tax alone, the reality is that corporations in this country will enjoy a $2.2 billion tax break. Canadians are asking themselves, and urging the Government to look in the mirror as well, to ask if this is fair economics. Of course, the resounding answer is no. Is it fair to pass increased taxes to the consumer when a very elite community in our country will enjoy capital gains tax breaks that were introduced by the
Minister of Finance last May? Is it fair to pass on to consumers the goal of deficit reduction while the Government is bailing out banks in this country? Is it fair to ask consumers to pay more in the face of the Olympia & Gulf deal of over $1 billion?
Is it fair when tax increases in the Budget introduced by the Minister last May will mean that families in this country which earn $15,000 will pay 35 per cent more tax by 1990 while those earning $200,000 will only pay 4 per cent more and those in the fortunate income bracket of $400,000 will only see an increase of 2 per cent?
What sense of fairness is there in a measure which will mean that a family earning $15,000 will pay 35 per cent more while those earning close to $500,000 will face a 2 per cent increase?
When Government attempted to deindex the pensions of senior citizens, it told pensioners to forget about the social contract they had with the Government because it wanted to reduce the deficit. Is that fair? Of course not, and the senior citizens of the country taught Parliament and the Government in particular a big lesson about fairness. It seems that the Government has not learned its lesson very well because it went on to deindex family allowances. It is essentially telling mothers and children in this country that they also have to bear the brunt of deficit reduction. Yet there are companies and individuals in this country who earn millions of dollars but pay very little or no tax at all.
Canadians realize we must get our financial house in order and they are saying they will do it as long as it is fair for everyone. The $15,000 wage earner is prepared to pitch in with his family to put our financial house in order but he is not prepared to make that sacrifice when other families, individuals and companies in this country are not shouldering a fair burden of deficit reduction for economic renewal.
That is why this Bill is unfair and should not be supported by the House. It does not ask all Canadians to shoulder deficit reduction or the economic renewal equitably. This Bill, like most of the Budget measures, hits those families the hardest who can least afford to pay. That is why a host of organizations have come before Parliament to indicate their disapproval with this Bill. These organizations include the Metro Social Planning Council, COSTI and the Toronto Association of Neighbourhood Services. They have pointed out that this is a regressive and unfair Bill which attempts to place the burden for deficit reduction on the poor.
It is for that reason that the Government should withdraw Bill C-80 and redraft it. It is a regressive Bill which is unacceptable to Canadians.
Therefore, it gives me great pleasure to move, seconded by the Hon. Member for Trinity (Miss Nicholson):
That the motion be amended by deleting all the words after the word "that" and substituting the following therefor:
Bill C-80, an Act to amend the Excise Tax Act and the Excise Act and to
amend other Acts in consequence thereof, be not now read a second time but
that it be read a second time this day six months hence.
November 5, 1985


STATEMENTS PURSUANT TO S.O. 22
[Stage Direction]
It is a fair motion that speaks to the equity that all Canadians want in this legislation.
Mr. Doug Lewis (Parliamentary Secretary to President of the Treasury Board):: Mr. Speaker, I will not take up too much time of the House since we will break for lunch shortly. However, I want to make it clear on the record what the opposition Parties are attempting to do in this debate. They have no more speakers who have anything to say and the fact is that the point of the amendment is to refresh the list of speakers. They are recycling the Members who have already spoken.


Some Hon. Members:: Oh, oh!


The Acting Speaker (Mr. Charest):: Shall we resume debate?


Douglas Grinslade Lewis: Mr. Speaker, on the one hand, the Opposition complains that we are cutting off debate. On the other, it cannot even raise enough interest in this debate among its own members to bring in any more than four Members in the House.


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


Douglas Grinslade Lewis: The Member for Ottawa-Vanier (Mr. Gauthier) is here.


The Acting Speaker (Mr. Charest):: 1 ask the Hon. Member
to take his seat.


Jean-Robert Gauthier: Mr. Speaker, I rise on a point of order. 1 knew that the Member was going to state the number of Members in the House, although it is against the rules. We noticed from this side that there were only three of them until the motion was put. Then they all flocked into the House, the book-ends and everyone over there came in like a bunch of servants.


The Acting Speaker (Mr. Charest):: It is lucky for everyone in the House that there is only one of me. It being one o'clock, I do now leave the Chair until two o'clock this afternoon.
At 1 p.m., the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.

Mrs. Lucie Pepin (Outremont):: Mr. Speaker, like the Confederation des organismes familiaux du Quebec, the National Action Committee on the Status of Women and more than 90 groups throughout the country, I want to voice my opposition to Bill C-70.
On October 23 the Minister of Finance (Mr. Wilson) admitted that the deindexation of family allowances would be used to reduce the deficit, but until then the Conservatives had always maintained that those savings would be set aside for other social programs.
The Government could not care less about its election promises with respect to the social sector, but it does live up to its commitments respecting the energy field, as evidenced by the Western Accord and the dismantling of the National Energy Program.
Bill C-70 has to be one of the measures which has drawn the strongest opposition from family organizations, women's groups and native people associations, among many others. The Conservative Government should be ashamed to bring down upon itself the wrath of poorer Canadians.
When the establishment of a country is in favour of something and the poor try to defend themselves, it is because the Government is not exactly upholding the right cause.
I hope that opposition against the deindexation of family allowances on the part of so many social groups will prompt Members on both sides of the House to have second thoughts.


INDIAN AFFAIRS
Mr. John Parry (Kenora-Rainy River):: Mr. Speaker, the process of land claims for Indian bands in Ontario is in much need of repair. The Office of Native Claims is supposed to work in the best interests of Indian people, as is the Department of Indian Affairs whose Minister has a fiduciary responsibility in these matters.
One case in point, where this trust has been abrogated, Mr. Speaker, involves the Stangecoming Band near Fort Frances, Ontario. This Band is situated on an isolated island with no sewer and water, no electricity, no community buildings and, of course, is only accessible by water or air. With only one radio telephone on the island and no schools or medical facilities, it is easy to see why these people want a real place to

November 5, 1985
live. But in order to do so, they need action from the Department of Indian Affairs.
The Minister has been made aware of the situation many months ago by the Stangecoming Band, the Assembly of First Nations, and myself. The Minister is also aware that if this situation is not resolved in a satisfactory manner, the Band will seek redress at a higher level, namely, the Federal Court.
Such action should not be necessary, Mr. Speaker, if the Office of Native Claims and the Minister would adhere to the Indian Act, act in the interest of the Stangecoming Band, and fulfil the commitments undertaken to the Band.


ENVIRONMENTAL AFFAIRS
Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, through you, I wish to appeal to the 24 per cent of Canadians who drive automobiles. It is estimated that this many motorists misfuel their cars to save money at the gas pump. Misfuelling occurs when cheaper leaded gas is used in automobiles designed to burn non-leaded fuel exclusively. This practice destroys anti-pollution devices in the engine and causes harmful leaded emissions to be introduced into the air.
I need not remind any Canadian of the evil effects acid rain is having on the environment, our health, and our forests. The short-term gain of a few pennies at the pump is not worth the long-term pain we shall endure if misfuelling continues.
To his credit the federal Minister of the Environment (Mr. McMillan) has advocated wiping out the price differential between leaded and unleaded gasolines. Better yet, he wants to eliminate lead from gasoline entirely by the early 1990s.
Lest we introduce an Orwellian police state to regulate misfuelling, the onus is on each motorist to control this practice. From this point forward, Mr. Speaker, let each Canadian driver know he or she is part of a nation-wide honor system. Misfuelling must be regarded as a perversion upsetting our fragile environment.


THE ECONOMY
Mr. Jean-Guy Guilbault (Drummond):: Mr. Speaker, the latest survey made by the Canadian Federation of Independent Business shows that the rising trend in employment and capital investments in the small business sector is firm and that the capital gains tax exemption announced in the May Budget will indeed spur economic growth.
Those measures have restored a climate of confidence and signalled the beginning of a new approach in business planning on the part of many company owners.
The survey reveals that projected increases in capital investments and operating funds are more encouraging than they have been for quite some time.
Mr. Speaker, 42 per cent of those small businesses intend to boost their investment projects in the near future and to hire more people.
Quite clearly, small businessmen have welcomed the measures implemented by our Government to improve the small business investment climate, make funds more readily available, lower interest rates and do away with some of the more redundant regulations governing small businesses.
The survey definitely attests to this Government's intention of leading Canadians on the road to prosperity.


PUBLIC SERVICE
Mr. Dave Dingwall (Cape Breton-East Richmond):: Mr. Speaker, I rise to bring to the attention of the House the plight of retired public servants whose careful planning for their days of much deserved rest has been torn as under by the Government's plan to end full indexing of their pensions.
On April 17 of this year the President of the Treasury Board (Mr. de Cotret) told this House of planned changes to public service pensions. Included in the package of amendments were provisions to replace the present practice of guaranteeing benefits fully indexed against inflation with protection based solely on the earnings of pension funds.
Present superannuates have paid for their pensions and their indexing, and they have every right to expect that protection to continue.
To quote the Progressive Conservative Party's own literature from the last election campaign:
Our position is that current pensioners signed a contract with the Crown in years past and that contract should not be altered unilaterally by government. While our Party recognizes the need to negotiate changes to arrangements with current employees, we are determined that these must not affect the benefits for current superannuates.
If the Supplementary Retirement Benefits Act or the Public Service Superannuation Act is changed, a grandfather clause must be introduced to protect former public servants who are now retired. Anything less, Mr. Speaker, would be a betrayal of trust with Canadians who serve our country with diligence and dedication.
November 5, 1985


INCOME TAX
Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, last night millions of Canadians from coast to coast tuned in to watch the annual Juno Awards which celebrate excellence in the Canadian music industry.
Today I would like to present the "Golden Loophole Award" for excellence in the field of tax avoidance. Today we learned from Revenue Canada officials that the latest statistics available show that in 1983, 7,782 individual Canadians with incomes above $50,000 per year paid not one red cent in income tax.
When you consider these figures alongside the recent announcements of billion dollar tax breaks for corporations like Olympia & York and Dome Petroleum, it is surprising that taxpayers are not storming the Parliament Buildings.
What is important to remember in all of this, Mr. Speaker, is that this is perfectly legal. If you are wealthy enough to make use of the investment tax credit, the half a million dollar capital gains exemption, the indexed security investment plan or the flow-through share purchase tax credit, to name but a few of these loopholes, it is not surprising that you can end up without having to pay a cent in income tax.
If you are a corporation, Mr. Speaker, it also helps to have a Government formed by either the Liberals or the Conservatives, who have always shown themselves willing to use the taxpayers' chequebook to help out those large corporations that donate so generously to their party coffers.
All in all, I would say that ordinary wage-earning taxpayers are getting tired of having to pay for these tax boondoggles. It is time that the income tax system was changed to require everyone, including the wealthy, to pay their fair share.


AGRICULTURE
Mr. Bill Tupper (Nepean-Carleton):: Mr. Speaker, last week representatives of the Canadian Federation of Agriculture met with the Prime Minister (Mr. Mulroney), with members of the Cabinet, and with provincial caucuses.
Their president, Mr. Don Knoerr, stated on Canada AM on Wednesday:
It would be unfair of me to even suggest that this Government is not addressing agriculture issues.
They appreciate the fact that on Tuesday afternoon the Prime Minister adjourned a cabinet committee meeting to permit the Economic and Regional Development Ministers to attend their presentation. They appreciate the fact that over $2 billion has been spent since the election for such things as
special disaster assistance, farm finance initiatives, and research and development.
They appreciate legislation such as that providing for increased railroad accountability, freight rate stability, earlier payments under the Western Grain Transportation Act, and a doubling of advance payment levels for storable crops. They appreciate the $500,000 capital gains exemption.
[DOT] (MIO)
Canadian agriculture has built itself around the family farm. Farmers have doubled their efficiency in the past 12 years and have provided Canadians with low-priced food of the highest quality. The Federation urged the Government to establish farm credit at rates to preserve the family farm, to expand, to expand research, to support supply management, and for emergency relief for farm disasters. The Federation recognized that the Government is acting to preserve agriculture and the family farm.


CANADA ELECTIONS ACT
Mr. Patrick Boyer (Etobicoke-Lakeshore):: Mr. Speaker, the election expense provisions in the Canada Elections Act have proven, over the past decade, to be an important reform, ensuring that politics in Canada is not a preserve of the wealthy, and providing balance between contending Parties and candidates.
Over the past year, however, those very provisions have themselves proven to stand in need of reform in one important respect. I refer to the investigation of allegations of campaign overspending by candidates.
The Chief Electoral Officer lacks power to investigate complaints, to determine their validity swiftly, fairly, and in an even-handed manner. If he had this power, an investigation could determine whether evidence exists for charges to be laid, and then the matter turned over to the RCMP and made public. Members of all three Parties in the House, and the independent Member, have learned first-hand of the need for a reform of investigative and enforcement powers for election spending, to ensure that equal benefit and equal protection of the law apply to MPs as well as to all other Canadians. We do not need, in the first instance, the heavy hand of an RCMP investigation to determine what is essentially a matter of administrative compliance.
The Mulroney Government has already demonstrated a reform instinct as far as electoral matters are concerned, and I am confident that amendments to the Canada Elections Act could be made here as well.

November 5, 1985


EXTERNAL AFFAIRS
Mr. John Nunziata (York South-Weston):: Mr. Speaker, last week I had the honour of being part of the Canadian delegation which visited New York to observe and be briefed on the workings of the United Nations.
Might I say how impressed I was with the Canadian involvement and contribution to the UN. 1 was expecially proud and impressed with our Ambassador, Stephen Lewis, who has breathed new life and enthusiasm into the UN.
As part of our tour we also visited the Canadian Consulate and the Quebec, Ontario and Alberta Trade Offices. Upon entering the Quebec Trade Office I noticed, much to my chagrin, the absence of a Canadian flag. There was not one anywhere to be seen. I thought at first that it was an oversight. When 1 asked why there was not a Canadian flag displayed, I was told bluntly that the office was not there to promote Canada.
On touring the offices, 1 noticed a separatist poster in the office of the administrator. In another office there was an American flag beside a Quebec flag, but no Canadian flag. On reviewing the promotional literature, there was no mention of Canada or the fact that Quebec is a province of Canada.
As a proud Canadian, I felt let down by the Government of Quebec. As a proud Canadian, I felt betrayed. While it may not be the job of the Quebec Trade Office to promote Canada, surely it should recognize Canada as the great united nation we are.
* *
*


VETERANS AFFAIRS
[Stage Direction]
This record has brought new hope to veterans and their dependants, and it is something, in my opinion, of which we can be tremendously proud. These veterans made sure the terror of war never reached our shores. With these expanded veterans' programs, they can maintain their pride as well.


Right Hon. John N. Turner (Leader of the Opposition):: Mr. Speaker, my question is for the Prime Minister. The Government's secret, manipulative style of negotiations in respect of free trade with the United States is doing a disservice to the country. Yesterday the Secretary of State for External Affairs admitted that culture would be part of the negotiating items. That is just great; now Canadian culture is on the block. Last night, when the Prime Minister attended the Juno Awards, did he tell that to Bryan Adams and Corey Hart?


Right Hon. Brian Mulroney (Prime Minister):: No-


Mr. Blackburn (Brant):: He didn't even sing.


Martin Brian Mulroney: I didn't sing. I couldn't; i am bound by union rules. The NDP knows that.
What I did tell them was that-I repeated my statement of September 26-our political sovereignty, our system of social programs, our commitment to fight regional disparities, our unique cultural identity and our special linguistic character are the essence of Canada. They are not at issue in these negotiations.


Mr. Elliott Hardey (Kent):: Mr. Speaker, Canada's more than 700,000 veterans of three foreign wars report that they are at last being treated with courtesy and respect by the Government, after many years when their problems and concerns were largely ignored, making them feel like second-class citizens. The change in Government attitude is a direct result of the dedication of the Minister of Veterans Affairs (Mr. Hees).
The slowness of the pension process has been eliminated, with more than 50 per cent of pension decisions now going in favour of the veterans. A year ago that figure was only 28 per cent.
Other changes include an increase in the basic rate of pensions to parity with Public Service categories. Disability pensions at married rate now continue a full year after the death of a pensioner. There are increases in the casual earnings and interest earnings exemptions, as well as many other improvements. The program will again be expanded in 1986.


John Napier Turner: Having heard those words from the Prime Minister, I wish he would communicate that directly to the Secretary of State for External Affairs-


Some Hon. Members:: Hear, hear!


John Napier Turner: -because he gave the distinct impression to the House of Commons yesterday that our cultural industries were to be part of the negotiations with the United States.


Some Hon. Members:: Oh, oh!


CULTURAL INDUSTRIES-GOVERNMENT POSITION
John Napier Turner: Mr. Speaker, at a time when the Canadian record industry is in a slump as a result of an influx of U.S.-produced records, how
November 5, 1985

can the Prime Minister claim to want to negotiate with the United States on the subject of our cultural industries?


Right Hon. Joe Clark (Secretary of State for External Affairs):: Mr. Speaker, today, the Prime Minister has again pointed out that our Canadian cultural identity is not at stake and is not on the table in any negotiations we may engage in with the United States. What we want to do is to provide new strength for our cultural industries. We know we can do this, first of all, by implementing domestic policies in this country that will strengthen our cultural industries and second, by finding ways to expand the markets available to Canadian performers.


PRICE AND VALUE OF CANADIANISM
John Napier Turner: Mr. Speaker, with the greatest respect to the Secretary of State for External Affairs, he is swallowing himself today, after what he said in the House yesterday.
I ask the Prime Minister, who gave me a vague statement as to his intentions affecting the country: is the cultural industry-broadcasting, book publishing and periodicals-part of the items to be negotiated with the United States? Before he answers that, I want to remind him that while it may cost us a little more to live in this country and to be Canadian, the price of being Canadian is a price worth paying.


Charles Joseph Clark: Mr. Speaker, there is no doubt that the price of being Canadian is a price worth paying. There is no doubt that the value of being Canadian has been enhanced in this country and in the eyes of the world by, for example, the action taken by this Government to establish our sovereignty over our North, after years when that Government and that Party did nothing about Canadian sovereign interests.


Some Hon. Members:: Hear, hear!


BOOK PUBLISHING-PRENTICE-HALL TAKEOVER
Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, my question is for the Prime Minister. The Prime Minister is on record as saying that he is opposed to foreign takeovers of Canadian book publishers. Yesterday, in the House, the Secretary of State for External Affairs said just the opposite in respect of the industry, not necessarily the identity. My question to the Prime Minister is this: what is your policy?


Some Hon. Members:: Order.


Sheila Finestone: You can't have it both ways. Are you now leaning toward the lobby of Gulf & Western that is headed by your friend, Frank Moores?


Some Hon. Members:: Order.
Oral Questions


Charles Joseph Clark: Mr. Speaker, I am not sure there was a question there, but I think there was a question implied if not asked. I give the Hon. Member, as always, the benefit of the doubt. The answer is that the question with respect to one particular transaction relating to a Canadian publishing company is now before Investment Canada. I should make the point that, given the likely timetable of any negotiations that might occur with the United States, that question will be resolved before any negotiations might begin, because the resolution of that question has a deadline of December 31 and that deadline will be respected.


Mr. Speaker:: Supplementary question, through the Chair. FILM INDUSTRY


Sheila Finestone: Mr. Speaker, I thought I had addressed the Prime Minister. However, I will direct my question to the Prime Minister this time. Will the Prime Minister specifically guarantee that policy regarding films, magazines, books and broadcasting is not negotiable? Can we have the Prime Minister's word on that?


Charles Joseph Clark: Mr. Speaker, let me deal with the question of the film industry. The Hon. Member and other Members of the House will know that excellent Canadian films are produced in this country but cannot find an audience in the United States. Why is that? That is because of the old boys' network that exists in the United States. That is not a tariff barrier but it is a very real barrier that limits Canadian expression. Why do members of the Liberal Party not want us to have the opportunity, through any negotiations, to discuss the removal of that barrier to Canadian creativity?
[ Translation]


INQUIRY IF CULTURAL INDUSTRIES ARE NEGOTIABLE WITH UNITED STATES
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, the Government's policy with respect to our cultural industries is not clear. The Secretary of State for External Affairs was not clear about this yesterday, and the Prime Minister is not clear about the subject today. My question to the Prime Minister is quite simple: Are our cultural industries on the table in our negotiations with the United States, yes or no?


Martin Brian Mulroney: Mr. Speaker, on September 26 of this year, when I was making a statement on behalf of the Government, I mentioned that, among other things, Canada's cultural dimension was not at stake in the negotiations, and that any Government initiative would be aimed at further strengthening our cultural position. That was the position of my party and the Government I have the privilege of leading.

November 5, 1985
Oral Questions


CANADIAN POSITION
John Edward Broadbent: Mr. Speaker, to my knowledge this is the first time the Prime Minister has used the phrase "cultural industry" as opposed to "cultural sovereignty" or "cultural heritage". I would like to be very clear because not only the fate of one publishing firm is at stake right now but the fate of the whole cultural industry, and what that means for a sense of nationhood for Canadians is at stake. Is the Prime Minister saying that Canada's cultural industries, including film, radio and television, are not on the negotiating block and will not be a part of the negotiations that are now taking place with the United States?


Martin Brian Mulroney: Mr. Speaker, I think-


Charles Joseph Clark: Mr. Speaker-


Martin Brian Mulroney: I am sorry.


Some Hon. Members:: Oh, oh!


Charles Joseph Clark: Go ahead.


Martin Brian Mulroney: Mr. Speaker, we are so well prepared on this issue, as on every other issue-


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: -not only do we sing, but we sing in perfect harmony.
I made a statement on behalf of all members of the Government on the 26th. My hon. friend indicates some surprise and says that he had not heard it before. I think I indicated at that time that our commitment to fight and to defend our unique cultural identity, something which is done through a series of measures with which we are all familiar, is not at issue in these negotiations. That has always been the position of the Government.


CULTURAL INDUSTRIES INQUIRY
John Edward Broadbent: Mr. Speaker, once again the Prime Minister has not dealt with the question. I am not saying that he has not dealt with the question deliberately; far be it from me to suggest that. I simply say that he has not dealt with the question. The question does not concern the broad notion of cultural sovereignty or identity. It is very specific and is about our cultural industries. Will the Prime Minister just for once reply to that question clearly? Are our cultural industries going to be negotiated or not? It is a simple question. Please answer it.


Charles Joseph Clark: Mr. Speaker, I-


Some Hon. Members:: Oh, oh!


John Edward Broadbent: Will the real Prime Minister please stand up.


Derek Nigel Ernest Blackburn: You're five years late, Joe.


Charles Joseph Clark: Frankly, I-


Mr. Hnatyshyn:: That's one thing about the Junos, you can really rehearse.


Charles Joseph Clark: Mr. Speaker, 1 frankly do not know where the Hon. Leader of the New Democratic Party has been. I have indicated to him before that my colleague, the Acting Minister of Communications, and I will be meeting with representatives of the cultural industries, and we are looking to have that meeting on November 26, so that we can be sure that the interests of each cultural industry are well protected in the negotiations that might proceed with the United States.


John Edward Broadbent: So they are on the table.


Charles Joseph Clark: If he would stop shouting from his seat, the Hon. Leader of the Opposition-excuse me, John- the Hon. Leader of the New Democratic Party would know that there are some cultural industries that are concerned about the threat of negotiations and we intend to protect and preserve those industries. As well, there are others, such as the film industry and aspects of the publishing industry, that look forward to the opportunity of using these negotiations as a means of at least discussing the possibility of bringing down non-tariff barriers which limit the expansion of Canadian culture to larger markets. We are interested in strengthening Canadian culture, and that is what we are going to do.


CONTENT OF NEGOTIATIONS
David Charles Dingwall: Mr. Speaker, my question is directed to the Prime Minister. As the Prime Minister knows, culture is something about which people care and it is also at the very heart of sovereignty. Yesterday, and again today, the Secretary of State for External Affairs alluded to the fact that the book publishing industry is about to be sacrificed in the Government's attempt to snuggle up to the United States. Would the Prime Minister indicate to the House exactly what is on the table? Is the National Ballet on the table? Is the CBC on the table? Is the Neptune Theatre on the table for negotiations with the United States?


Charles Joseph Clark: Mr. Speaker, none of those cultural industries is on the table. The Neptune Theatre is not on the table and the CBC is not on the table. We are interested in looking to see if there is some way in which we can deal with the old boys' network that limits the distribution of Canadian films. We are interested in seeing if there is some way that we can resist the pressures that are now growing in the United States Congress against a provision in American practice that allows Canadian
November 5, 1985

authors access to U.S. markets because, under practice, but not law or treaty, they are treated as American authors. We are looking for ways to strengthen Canadian culture. For the life of me I cannot understand why members of the Liberal Party are so afraid of Canada that they do not want us to look for ways through these negotiations to strengthen our cultural industries.


NEGOTIATION ISSUES
David Charles Dingwall: Mr. Speaker, recently we have learned of a secret External Affairs document which emphasizes symbols as opposed to substance with regard to free trade with the United States. 1 suggest that the Government cannot continue to insult the Governor General by ignoring her role as head of state when the President of the United States comes to town, and then demand that she allow herself to be used for partisan purposes-


Mr. Speaker:: Order, please.


David Charles Dingwall: The Secretary of State for External Affairs has given us three examples of issues that will not be on the table. Will he now tell us what will be on the table?


Charles Joseph Clark: Mr. Speaker, one thing for which the people of Canada can be grateful is that Canada will not be represented at any negotiating table by that insecurity about Canada that is rife and rampant in the Liberal Party.


Some Hon. Members:: Hear, hear!


Charles Joseph Clark: Some Parties in this House were afraid to assert northern sovereignty for 16 years. This Party and this Government asserted northern sovereignty.


Some Hon. Members:: Hear, hear!


Charles Joseph Clark: We have made it clear on numerous occasions that the cultural institutions of Canada are not at issue and are not negotiable. What is at issue is that we have an opportunity to strengthen Canadian cultural expressions. We will not be so timid-


Some Hon. Members:: Oh, oh!


Charles Joseph Clark: -that we will not respond to that opportunity.


THE GOVERNOR GENERAL
Mr. Ian Deans (Hamilton Mountain):: Mr. Speaker, my question is also for the Prime Minister who will recall that at the Shamrock Summit the intent to use the office of the
Oral Questions
Governor General on the part of the Government became apparent. Given the report with respect to a memo provided for Cabinet by External Affairs which indicates a recommendation to the Government that the Governor General could and should be used to promote nationalism within the country while at the same the trade negotiations could go on with the U.S., which may well undermine that very nationalism, will the Prime Minister tell us now that under no circumstances will the Governor General of Canada be used by the Government for partisan reasons, as is suggested in the memo?


Charles Joseph Clark: Mr. Speaker, naturally I have read with some interest Macleans magazine. I read it with some interest every week, as do all Members of the House. There was reference in it to a document which was described as not only a cabinet document but one that had caused discussions in Cabinet. I have to say that from time to time Maclean's magazine is discussed in Cabinet; that alleged document has never been.


Some Hon. Members:: Hear, hear!


CANADIAN NATIONALISM
Ian Deans: Mr. Speaker, now that we know that, I would like to ask my question again. In the memo prepared for Cabinet by External Affairs-whether Cabinet considered it or not-the use of the Governor General was recommended in appeasing nationalism in Canada at the same time as the negotiation process is going on. Is it the Prime Minister's intention to use the office of the Governor General in this partisan way?


Charles Joseph Clark: Mr. Speaker, this Party and this Government do not consider nationalism something to be appeased. This Party and this Government believe Canadian nationalism is something to be encouraged. That is what we did with Arctic sovereignty. That is what we did in the North-


Some Hon. Members:: Oh, oh!


Charles Joseph Clark: -and that is what we will do throughout the life and mandate of this Government.


Some Hon. Members:: Hear, hear!


SOCIAL SECURITY
Mr. Jean-Claude Malepart (Montreal-Sainte-Marie):: Mr. Speaker, I wish to direct a question to the Right Hon. Prime Minister.

November 5, 1985
Oral Questions
Yesterday, Quebec's Confederation des organismes fami-liaux reminded us in its brief that in addition to the commitments to Canadian families which the Government had made in the Speech from the Throne, the Prime Minister has stated in front of the cameras when his fourth child was born that a family is the finest thing which exists in this world, an opinion which I share, Mr. Speaker.
My question is this: Could the Prime Minister explain to the representatives of millions of Canadian mothers who are here why he intends to make cuts in the programs designed to strengthen the finest thing in the world, when he had promised never to make cuts in this area?


Hon. Jake Epp (Minister of National Health and Welfare):: Mr. Speaker, as I indicated to the Hon. Member earlier, and as the Minister of Finance has stated in the House, if he were to take a look at year-over-year spending on social policy he will see that there is an increase of $2 billion. In addition, if he will take a look at the specifics of Bill C-70, which I would be happy to discuss with him later today when we meet in committee, and if he looks at the family tax credits, he will see that there is an increase for those in greatest need.


REQUEST THAT PRIME MINISTER MEET MOTHERS' REPRESENTATIVES
Jean-Claude Malépart: Mr. Speaker, I should like to direct a supplementary question to the Prime Minister who would not answer my original question. Is that a family policy?
In a gentleman-like fashion, would the Prime Minister kindly accept to meet with the representatives of Canadian mothers who are here today in order to hear what they have to say? Also, could the Prime Minister confirm whether he will take into account the views which the Committee has received concerning Bill C-70? Yes or no?


Arthur Jacob (Jake) Epp: 


Mr.   Speaker-Ms. Copps@: Get up and answer.


Arthur Jacob (Jake) Epp: Mr. Speaker, as the Hon. Member has requested, I am willing to meet with groups which have specific issues which they want to address that are directly the responsibility of this Department and this Minister. As well, I say to him that I look forward to meeting with him and other members of the committee to discuss this matter further this afternoon.


GOVERNMENT EXPENDITURES
Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, my question is for the Minister of State for Transport. It is a $64,000 question concerning the Minister's travels earlier this year in April, June, and July. Can the Minister explain to the House why it was that on a four-day trip to Paris, when she had one meeting lasting approximately two hours, she felt it necessary to hire a limousine with a chauffeur at a cost of $1,700 to Canadian taxpayers? Does she not believe in taking a taxi? Why does she-


Mr. Speaker:: Order, please. I take it the Hon. Member is asking a question about the travels of the then Minister of the Environment. Therefore, I think he knows that his question must be directed to the current Minister.


Mr. Benjamin:: You are trying to get her off the hook.


Mr. Speaker:: I am not trying to get anybody off anything. The Hon. Member knows that if he has a question of a Minister it has to be within that Minister's current responsibilities or it has to be directed to the Ministry, in which case the Ministry may decide whom they wish to answer.


Svend Johannes Robinson: Mr. Speaker, I will then address my question to the Prime Minister, whose Government is cutting back family allowances at the same time as his Ministers are flying-


Mr. Speaker:: Order, please. I am trying to be helpful to the Hon. Member. He might just put his question, please.


Svend Johannes Robinson: Mr. Speaker, my question for the Prime Minister is this. Does the Prime Minister believe it to be acceptable for one of his Ministers to use a limousine with a chauffeur at a cost of $1,700, in Paris, in April of this year, when she had to attend one meeting lasting approximately two hours? Is that really an acceptable use of taxpayers' money?


Hon. Tom McMillan (Minister of the Environment):: Mr. Speaker-


Some Hon. Members:: Oh, oh!


Leslie Gordon Benjamin: What is the matter, Brian, are you afraid of the heat?


An Hon. Member:: Brian's a chicken.


Mr. Speaker:: Order, please.


Thomas Michael McMillan: Mr. Speaker, I know that the now Minister of State for Transport is quite capable of defending herself. She respects the rules, as I do, and for that reason, and because the question relates to my Department, I am pleased to give the explanation. The explanation is quite simply this. I have read the news accounts in this morning's papers and other media accounts of the Minister's travels in Paris, Stockholm and elsewhere, and it seems-
November 5, 1985


Some Hon. Members:: Oh, oh!


Mr. Fulton:: Then you agree she should resign.


Thomas Michael McMillan: -that into a relatively short time she packed a lot of official business on behalf of her Department and the Government of Canada-


Some Hon. Members:: Oh, oh!


Thomas Michael McMillan: The problem seems to be that the newspaper reports are based on an official agenda and not on the Minister's itinerary. The two are different.


Some Hon. Members:: Oh, oh!


John V. Nunziata: There is the answer!


Thomas Michael McMillan: Many of the activities in which she was engaged were not reflected on the official agenda. Indeed, some of the itinerary was fleshed out only upon her arrival, for example, in Paris. In the case of Paris-


An Hon. Member:: Table it.


Some Hon. Members:: Oh, oh!


Leslie Gordon Benjamin: Let him go.


Mr. Speaker:: Order, please. If Hon. Members want to hear the answer then there is only one way to achieve that.
Supplementary question.


Svend Johannes Robinson: Mr. Speaker, I am not sure whether the Minister completed his answer before my supplementary question.


Mr. Speaker:: Order, please. I take it the Hon. Member did not have a supplementary question.

The Hon. Member for Saint-Jacques (Mr. Guilbault) has the floor.


THE CABINET
Jacques Guilbault: If I may, Mr. Speaker, I would like to draw the Prime Minister's attention-


Svend Johannes Robinson: Supplementary question, Mr. Speaker.


James Ross Fulton: He has a supplementary question. You phoney.


Svend Johannes Robinson: Supplementary question, Mr. Speaker.


James Ross Fulton: Supplementary question!
Oral Questions


Mr. Speaker:: The Hon. Member for Saint-Jacques.


Mr. Cassidy:: Stop covering up!


Svend Johannes Robinson: Supplementary question, Mr. Speaker. I have a supplementary question. I have a supplementary question, Mr. Speaker.


Mr. Speaker:: Will the Hon. Member please resume his
seat?


Svend Johannes Robinson: I have a supplementary question, Mr. Speaker.


Mr. Speaker:: I invite the Hon. Member to resume his seat.


Svend Johannes Robinson: Mr. Speaker, I have a supplementary question.


Mr. Speaker:: Every Member in the place has a supplementary question.


Some Hon. Members:: Oh, oh!


Mr. Speaker:: The Hon. Member for Saint-Jacques.


Svend Johannes Robinson: 1 have a supplementary question, Mr. Speaker.


James Ross Fulton: You wait until we get to vote.


Svend Johannes Robinson: Supplementary question, Mr. Speaker.


An Hon. Member:: Talk about a Tory hack.


Michael Morris Cassidy: You are covering up for the Tories.


Svend Johannes Robinson: I have a supplementary question, Mr. Speaker.


Michael Morris Cassidy: You tricked him out of a supplementary question.


Mr. Speaker:: Order, please. If an Hon. Member believes that an unfairness has been done, or a breach of the Orders, his route is to raise a question of order after Question Period. I, therefore, invite the Hon. Member for Saint-Jacques to pose a question.


An Hon. Member:: We know what side you're on now.


Jacques Guilbault: Mr. Speaker, my question is directed to the Prime Minister and has to do as well with the unnecessary journeys of his Minister of Environment who squandered something like $64,000 of taxpayers' money last summer. I would like to ask the Prime Minister how he could possibly have authorized-I have here the Minister's written authorization request-such a trip when in fact the purpose of the trip, which was the signature of an automotive vehicle pollution agreement in Stockholm, had been cancelled ten days

November 5, 1985
Oral Questions
before her departure? How could he authorize such useless travel?


Some Hon. Members:: No, no.


An Hon. Member:: Be accountable, Brian.


Thomas Michael McMillan: Mr. Speaker, again the discrepancy between the media accounts and the true facts relates to the fact that the media accounts are based on an official agenda, not on the actual itinerary which the Minister followed. For example, in Stockholm- since the question was based on that particular leg of the trip-there were three days in Stockholm, from April 9 to April 13. The agenda shows that there was only a half day's business in an official capacity when in fact, between April 9 and April 13, the Minister was occupied with government business for two and a half days.


Jean-Robert Gauthier: Wow! Do tell.


Thomas Michael McMillan: This involved meetings with representatives of the Department of the Environment in Stockholm-


Mr. Ouellet:: At what level?


Thomas Michael McMillan: -and official functions hosted by the Ambassador in Stockholm, bringing together high level officials in that country with the Minister, including the Minister of Health-


Some Hon. Members:: Oh, oh!


Thomas Michael McMillan: -the Minister of the Environment, the Minister of Energy for that country-


Some Hon. Members:: Oh, oh!


Mr. Speaker:: Order.
[ Translation]


ISSUANCE OF AUTHORITY FOR MINISTER'S TRAVEL
Jacques Guilbault: Mr. Speaker, I have a supplementary, and again I shall direct it to the Prime Minister, leaving the junior Minister lost in his flurry of details. What I want to know is who gave the authorization. I have here a letter signed by the Minister, addressed to the Prime Minister's Office, which begins like this:
The purpose of this letter is to seek authorization to travel to Paris and Stockholm between April 3 and April 14.
I want to know why the Prime Minister or someone in his office gave authorization to make such an unnecessary trip whose very purpose had been cancelled even before the Minister got under way. How could such an authorization have been given? What I want to know, not from a junior Minister, but from the head of the Government-


Thomas Michael McMillan: Mr. Speaker, in connection with the meeting to which the Hon. Member has addressed himself-he said the meeting was of no import-the present Minister of State for Transport, the then Minister of the Environment, was vice-president of the ministerial meeting of the Environmental Committee of the OECD, during which time she met with high level representatives of some 24 countries over three and a half days. She addressed herself, with those officials, to the important questions of toxic chemicals, hazardous waste, air pollution, and acid rain, on which subjects I am wondering if the Hon. Member's Party is suggesting that Canada should abdicate responsibility in international relations.


Some Hon. Members:: Hear, hear!


CANADA-UNITED STATES NEGOTIATIONS-CULTURAL POLICY
Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, my question is directed to the Minister of State for External Affairs. Over 20 arts groups met with us in Toronto this morning and made it quite clear that they don't want to be pawns in this free trade game. Will the Minister now be precise and make it quite clear that key parts of cultural policy, like our CRTC regulations, our cross-border advertising regulations, and our ownership rules on broadcasting, are not going to be part of free trade negotiations?
Right Hon. Joe Clark (Secretary of State for External
Affairs): Mr. Speaker, the institutions of cultural expression in Canada, the regulations which guide and often inspire those institutions, are part of the exercise of Canadian cultural sovereignty. We intend to maintain absolutely unhampered the exercise of Canadian cultural sovereignty.
The Hon. Member knows that this Government, after 16 years of inaction in another field, in the Arctic, acted to assert Canada's sovereignty.


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!


Charles Joseph Clark: We intend to be as diligent about Canada's cultural sovereignty as-


Mr. Speaker:: Order.


Steven W. Langdon: Mr. Speaker, that is the most classic example of baffle-gab that I have ever heard.


GOVERNMENT POSITION
Steven W. Langdon: Would the Minister please, for the sake of all of those arts groups right across the country, give a straight answer to the question 1 asked?

November 5, 1985

With respect to those specific cultural policies which these arts groups identified this morning as absolutely crucial, will the Minister say that we are not prepared to sacrifice them, or to negotiate about them, in free trade talks? Make it clear!


Charles Joseph Clark: Mr. Speaker, I want to make it very clear that we are not going to sacrifice Canadian sovereignty; we are going to strengthen Canadian cultural sovereignty.


Some Hon. Members:: Hear, hear!


Charles Joseph Clark: I have great respect for the Hon. Member. He and I have discussed this matter at committee and elsewhere. He knows that, respect him as I do, I believe it is my duty, and that of the Acting Minister of Communications, to meet directly with representatives of the arts community and of cultural industries which might be affected by any negotiations we enter into.
The Hon. Member knows well that entering into negotiations, discussing something, does not mean that we necessarily conclude on something. If Canada's interests are not well served, then there will be no arrangement. That commitment is clear and has been clear from the beginning, and from the Prime Minister's words. We will be meeting with Canada's cultural industries and we will be protecting Canada's cultural sovereignty and integrity. I look forward to some positive cooperation from my hon. friend and from others in this House.


SMALL BUSINESS
Mr. Gabriel Fontaine (Levis):: Mr. Speaker, my question is directed to the Minister of Finance and concerns the compatibility of federal and provincial tax incentives. In his May Budget, the Minister of Finance provided opportunities for those who want to invest their money in small businesses, for instance, the Small Business Investment Corporations. Could the Minister inform the House whether there is any degree of certainty that investors in SPECs, Societe de placements dans l'entreprise quebecoise and SBICs, Small Business Investment Corporations, will be able to benefit from both federal and provincial tax incentives?


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, 1 want to thank the Hon. Member for his very good question and his interest in this area. As I understand his question, he is asking whether the small business investment corporations are eligible investments for pension funds and RRSPs, and the answer to that question is yes.
Oral Questions


THE CABINET
André Ouellet: Mr. Speaker, my question is directed to the Prime Minister. He will probably recall that when his Ministers were sworn in, he promised that they would exhibit frugality and moderation in their public spending. Has the Prime Minister issued guidelines in this respect, especially on the subject of their trips abroad? And if so, is the Prime Minister satisfied that his Minister of State (Transports) abided by the guidelines on her travels in Europe last summer?


Martin Brian Mulroney: Mr. Speaker, one of the figures I have seen since the end of our first year, from September to September, where results were compared with the previous year, was the very high operating costs for the Government's fleet of aircraft, which, if I am not mistaken, have dropped by about 32 per cent under this Government, compared with the previous year. Those savings are quite impressive.
My hon. friend, I think I can check with each Minister individually, but I think my hon. friend ... I will check this out in order to give him that assurance, and we hope that in every case, the same downward trend in spending, compared with the situation under the Liberal Government, will be maintained. It is one of this Government's objectives to be careful how we spend the taxpayer's money, and that is what we are doing.


REQUEST FOR PUBLICATION OF GUIDELINES
André Ouellet: Mr. Speaker, my supplementary for the Prime Minister is as follows. Did the Prime Minister issue guidelines, yes or no? If he did issue guidelines to his Ministers, and since he promised Canadians open Government, is he prepared to publish those guidelines?


Martin Brian Mulroney: Mr. Speaker, one of the guidelines was that a Minister shall never spend as much as one tenth of the expenses of the Hon. Member for Winnipeg-Fort Garry (Mr. Axworthy) when he was a Minister! That is one of the guidelines, and there are others.
I assume-


Mr. Axworthy:: What about your office, Brian? Why don't you measure your own office?


Martin Brian Mulroney: Oh, there he is, back from Florida.


Mr. Speaker:: Order, please. The Hon. Member for Beaches.

November 5, 1985
Oral Questions HOSPITALS


SAFETY OF OPERATING ROOM EQUIPMENT
Mr. Neil Young (Beaches):: Mr. Speaker, my question is directed to the Minister of Health. As he knows, there have been numerous deaths and injuries on operating tables as a result of faulty equipment, yet he does not seem to be prepared to do anything about it. What steps is the Minister taking to restore the confidence of Canadians in hospital room equipment and devices? Up until now, as his own Department head said, if anyone believes those devices and equipment are safe, then they believe in the tooth fairy.


Arthur Jacob (Jake) Epp: Mr. Speaker, the Hon. Member raises a very valid issue, one with which I have been concerned as well. Regarding the Health Protection Branch, specifically the Medical Devices Bureau, he appreciates that there is first of all the need for absolute safety, as well as the need to develop in Canada standards acceptable to both importers and Canadian manufacturers. I have looked at this matter and asked for a further update. As well, a 1-800 hotline has been established in which doctors and other health care professionals can phone directly to report incidents such as these. This is apart from any other action we have to take in tightening up the inspection system.


LAUNCHING OF PROSECUTIONS
Neil Young: Mr. Speaker, could the Minister then advise the House why, even when cases are reported, his Department refuses to prosecute the manufacturers of these faulty products, as even their association has requested the Minister's Department to do?


Leslie Gordon Benjamin: That is not free enterprise.


Arthur Jacob (Jake) Epp: Mr. Speaker, it has nothing to do with free enterprise or anything else, but it has everything to do with the safety of Canadians. The Hon. Member is going back to some historical data. The point I want to make is that approximately 300,000 devices are in use across our hospital and health care system. Most of those are imported. Where prosecutions should be initiated, this Minister has no hesitation in doing so. In fact, quite the opposite. The Minister is instructing his Department that, where this can be founded, to do so.


MULTICULTURALISM
Mr. Bill Attewell (Don Valley East):: Mr. Speaker, my question is directed to the Minister of Multiculturalism. Most Canadians who choose to come to this country from another land see no conflict in being a Canadian first while preserving their cultural heritage and roots. Does the Minister agree that no conflict exists in these priorities, and will the Government
continue to give strong encouragement to the preservation of cultural heritage?


Hon. Otto Jelinek (Minister of State (Fitness and Amateur Sport) and Minister of State (Multiculturalism)):: Mr. Speaker, I am very happy to see an interest in this very important matter coming from this side of the House as opposed to the opposition Parties. I would like to tell the Hon. Member and the House that I am in the process of reviewing the funding criteria which will encourage the retention of ethnic culture, which of course is good for Canada's cultural community, while at the same time providing equal opportunity for all Canadians which will benefit all of Canada.


MUNICIPAL AFFAIRS
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, I had a question for the Minister of Justice or the Solicitor General, but in their absence I will direct it to the Prime Minister.
When 1 asked the Minister of Justice yesterday about the Eagle Combat School in British Columbia he replied that its activities were within the law and there was nothing he could do about it. Is it not time that these schools were subject to laws and regulations in view of the fact that they very often spawn vigilante muscle groups and even terrorist activities? Is it not time that these schools were subjected to standards and supervision in the best interest of society?
Ramon John Hnatyshyn: Mr. Speaker, in the absence of the Minister of Justice I might respond that it is one thing to make rather sweeping allegations with respect to any particular business. 1 think the Minister responded with the information he had at his disposal. If the Hon. Member has some specific allegations to make with respect to matters which are offensive under our Criminal Code, or which he feels should be dealt with in that context, I wish he would bring them forward. I am sure the Minister will give them the proper attention.


Mr. Speaker:: A very short supplementary.


REQUEST FOR FEDERAL-PROVINCIAL DISCUSSION
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, at one time our private security agencies and detective forces were not subject to law and supervision. I know these schools are not now subject to law. However, 1 am asking the Minister if his Government will make a commitment to raise the matter at the federal-provincial conference of Attorneys-General to make sure that these schools are subject to standards and supervision and that they do not do the sort of things they are suspected of doing in the U.S. where there have been a lot of problems?
November 5, 1985
Ramon John Hnatyshyn: Mr. Speaker, without accepting the basic premise of the Hon. Member's question, I will take it as a representation in a general sense. I will make sure the Minister receives the representation, and he will get back to the Hon. Member in due course.


NUCLEAR ARMAMENTS
Ms. Pauline Jewett (New Westminster-Coquitlam):: Mr. Speaker, my question is directed to the Prime Minister. He will know that at the very time he was speaking to the consultative group on arms control and disarmament last week, six of the world's most distinguished statesmen were issuing a call to the U.S. and the U.S.S.R. to suspend all nuclear testing for at least 12 months. Will the Prime Minister consider Canada joining this great five-continent initiative and, indeed, possibly offering Canada's verification mechanisms to help provide third-party monitoring?
Right Hon. Joe Clark (Secretary of State for External
Affairs): Mr. Speaker, as the Hon. Member knows, this matter has been raised and considered before. It is Canada's view that, particularly at this time as the Soviet Union and the United States prepare for a Summit which could well hold the world's security in its hands, it is important for Canada to continue to play actively those roles we have traditionally played. That means, of course, that we want to pursue, very vigorously, initiatives and opportunities open for us at Stockholm, at Geneva, at the MBFR talks and in other fora.


Mr. Speaker:: A short supplementary question.


CANADIAN POSITION
Pauline Jewett: Mr. Speaker, is the Prime Minister willing, however, to join the leaders of Greece, Sweden, Argentina, India, Mexico and Tanzania in calling for an immediate ban by both sides on nuclear testing? That would be the action we could take now, and we could help in the verification of that action.
Right Hon. Joe Clark (Secretary of State for External
Affairs): Mr. Speaker, asking others to act is not always action. The Hon. Member has asked the Prime Minister of Canada to join the leaders of India and some other countries. Very recently at Nassau the Prime Minister of Canada not only joined those leaders but led those leaders-


Some Hon. Members:: Hear, hear!


Charles Joseph Clark: -in coming to a conclusion on an important international question on which Canada has direct influence. It is the policy of the Government to direct its
Point of Order-Mr. Robinson
attention toward those areas in which we can offer leadership and influence, not simply advice.


Some Hon. Members:: Hear, hear!


CLERK OF PETITIONS' REPORTS
Mr. Speaker:: I have the honour to inform the House that the petition presented by the Hon. Member for Swift Current-Maple Creek (Mr. Wilson) on Monday, November 4, 1985, by filing with the Clerk of the House, meets the requirements of the Standing Orders as to form.



POINTS OF ORDER


Svend Johannes Robinson: Mr. Speaker, I rise on a point of order flowing from my question to the Minister of the Environment (Mr. McMillan) in the House today. On October 3, 1985, I asked a question of the Minister of State for Transport (Mrs. Blais-Grenier) as follows:
Is the Minister prepared to account to the taxpayers of Canada by tabling in this House all receipts for her personal expenditures on these junkets around Europe?
That was the question, Mr. Speaker, which I put to the Minister of State for Transport and on October 3 the Speaker allowed the Minister of State for Transport to answer precisely that question. I, of course, assumed that the Speaker's ruling today would be the same as his ruling on October 3. Therefore, following the precedent established by the Speaker, I put my question once again to the Minister of State for Transport. Well, Mr. Speaker, the rules apparently changed and the Speaker indicated that I should put my question to someone else, either the Prime Minister (Mr. Mulroney) or the Minister of the Environment. I then, Mr. Speaker, got up and put the question to the Minister of the Environment, and the Speaker will recall that the answer of the Minister of the Environment was interrupted by noise and then the Speaker stood up.
My recollection, Mr. Speaker, is that at that point the Speaker said that Members of the House should allow the Minister to complete his reply. My recollection of what the Speaker indicated is that Members should allow the Minister to complete his reply and that he was not being permitted to do so. I then stood up and indicated, because the Minister of the Environment was rising at the same time, that before putting a supplementary question I would allow the Minister to complete his answer. He was on his feet, Mr. Speaker. The Speaker then knew very clearly that I had a supplementary-


Mr. Speaker:: With great respect, I am prepared to let the Member finish his point of order, but I would appreciate if he would come to a point of order.

November 5, 1985
Point of Order-Mr. Robinson


Svend Johannes Robinson: Mr. Speaker, I clearly indicated that I had a supplementary question for the Minister of the Environment. The Speaker, however, said: "Obviously the Member does not have a supplementary question".
There is an appearance of, if not favouritism, certainly, Mr. Speaker-


Mr. Speaker:: Order! Order, please. If the Member has an allegation to make, he may make it, but not in this way. Does the Member have a point of order to make? The Hon. Member knows full well, I take it, that the question of who may ask a question or whether, in fact, any supplementary questions may be granted, is entirely at the discretion of the Chair. Is the Hon. Member, therefore, saying that a point of disorder occurred during Question Period under our rules?


Svend Johannes Robinson: Yes, Mr. Speaker, in two respects, the first with respect to the precedent that the Speaker himself established. On October 3 of this year the Speaker-


Mr. Speaker:: Order. Order, please. Could the Hon. Member give me a point of order? The Hon. Member is saying that something happened once. Is he then arguing, therefore-I am sorry. It is improper for me to debate this question with him, as I think he well knows. If he has a point of order to make, I would be glad to hear it. If his point is that a previous question was allowed that was improperly allowed, then I am prepared to look at that and determine whether in fact a previous question was improperly allowed by myself or anyone else. However, the Hon. Member knows full well, as he is an experienced Member of the House, that questions may not be put to Ministers with regard to their previous portfolios or a portfolio which that Minister no longer holds. I think that the Hon. Member is an experienced enough Member to know that.


Svend Johannes Robinson: Mr. Speaker, I also have Beauchesne's and I believe it indicates that this House is governed by precedent.
However, my second point of order, Mr. Speaker, is with respect to the question of order that arises from a situation in which the Speaker indicates, despite the clear record, that a Member did not ask for a supplementary when the Member clearly did ask for a supplementary question.


Mr. Speaker:: Order, please.


Svend Johannes Robinson: That is a question of order.


Mr. Speaker:: It is not a question of order. I recognized the Hon. Member for Burnaby clearly by saying: "Supplementary question". The Hon. Member for Burnaby rose to say that the Minister had not finished his answer. I, therefore-


Svend Johannes Robinson: And I said I had a supplementary.


Mr. Speaker:: I, therefore, went to the next questioner. I am more than happy to check the "blues" and if I have caused an offence to the Hon. Member, I will be more than happy to do the appropriate thing but, clearly, there is no question of order.
I think that the Hon. Member is an experienced Member and knows that.


Svend Johannes Robinson: Mr. Speaker-


Mr. Speaker:: Is the Hon. Member rising on a separate point of order?


Svend Johannes Robinson: Mr. Speaker, if I may conclude on this point of order, I would ask the Speaker to check-


Mr. Speaker:: Please! Is the Hon. Member rising on a separate point of order? The Hon. Member, I think, knows full well that the question of who puts questions and whether supplementary questions may be put is entirely discretionary. If the Hon. Member wishes to pursue the matter he may want to come to see me, but I will be glad, as I indicated, to check the "blues".



TABLING OF DOCUMENTS CITED BY MR. McMILLAN

Ian Deans: Mr. Speaker, I have a point of order.


Mr. Speaker:: The Hon. Member for Hamilton Mountain (Mr. Deans) on a point of order.


Ian Deans: Mr. Speaker, I have a somewhat different point of order. During the course of his reply to questions asked here today, the Minister of the Environment (Mr. McMillan) appeared to be reading some documents that had been provided to him that dealt specifically with the agenda of the former Minister of the Environment. He appeared, in fact, to be quoting from those documents in making his argument that the agenda was different in some way from the actual events that occurred-from the "itinerary" as he put it. I would like to ask you, if you would, Mr. Speaker, to review what was said during Question Period to determine whether in fact the Minister was citing those documents for the purpose of strengthening his reply. If that be the case, I would like to ask, respectfully, that he be requested to table the documents.


Thomas Michael McMillan: Mr. Speaker, perhaps I could resolve this matter by assuring the Hon. Member that I was not referring to any official agenda or official itinerary. To the extent that 1 was referring to anything, I was referring only to handwritten notes to myself based on conversations I have had with the present Minister of State for Transport (Mrs. Blais-Grenier) with my own officials, her former officials, and with former and current members of her staff. I do not think, therefore, Mr. Speaker, that they fall into the category of that which would be appropriately tabled today.


Ian Deans: Mr. Speaker, I am delighted to accept the Minister's assurances that he was not citing from official documents. I would request that, at some point, he and the former Minister get together to consider whether tabling the documents that relate to that particular trip might be advisable in the public interest.
November 5, 1985



HOUSE PRACTICE RESPECTING QUESTIONS CONCERNING MINISTER'S FORMER PORTFOLIO

Mr. Ian Waddell (Vancouver-Kingsway):: Mr. Speaker, 1 have a point of order. As one sitting on the back-benches and listening to the procedure whereby one Minister has to answer for another Minister who no longer has that portfolio, 1 wonder if it would not be proper to have either Minister, perhaps the first Minister, make a statement under Motions in response to the whole matter.


Mr. Speaker:: I am sure the Hon. Member intends that that be taken as a representation to the Government. That may be his view, but I have to say to him that it is not a point of order.


Leslie Gordon Benjamin: It is still a good point.


Mr. Speaker:: It may well be.



ROUTINE PROCEEDINGS


Arthur Jacob (Jake) Epp: Mr. Speaker, pursuant to the provisions of Standing Order 47(2), I wish to table in both officials languages copies of the report published under the title Canada Pension Plan Benefits for Survivors under the Age of 65.


PETITIONS
James Ross Fulton: Mr. Speaker, 1 am pleased to table today in the House a petition from a large number of British Columbians who are concerned about the cut-back in family allowances while at the same time the Mulroney administration is bringing forth billions of dollars in hand-outs to the oil companies and a billion dollars for bail-outs of the banks.


Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, it is my pleasant duty to table in the House of Commons today a number of petitions from metropolitan Toronto citizens who pray and call upon the Conservative Government to restore full indexation of the family allowance and child tax credit.


Victor Fredrich (Vic) Althouse: Mr. Speaker, it is my honour to present a petition from residents of Saskatoon who point out that the family allowance deindexation will not be offset by changes to the tax credit for children and that
Petitions
even the poorest families will be worse off by 1990. Therefore they call on the House to reverse the Government's policy on deindexation of family allowances.


Leslie Gordon Benjamin: Mr. Speaker, I have the honour and duty to present five petitions from Regina, Saskatoon, Yorkton, Nipawin, Unity, Coronach and Carduff. The undersigned, your petitioners, call upon the House to make sure that full indexation of the universal family allowance is retained. They are in duty bound to pray forever and so am 1.


Mr. Ross Belsher (Fraser Valley East):: Mr. Speaker, I have the honour to present petitions to the House containing several hundred names from St. Mary's Church, Faith Christian Fellowship, Glad Tidings Fellowship on the Netherlands Reform Congregation and the Eden Mennonite Church. All of these congregations which are located in Chilliwack, British Columbia, in the beautiful Fraser Valley East, urge the federal Government to strive to establish clear obscenity legislation and to enforce stricter control of pornography.


Jean-Robert Gauthier: Mr. Speaker, I have the honour to present a number of petitions to the House asking the Government of Canada to restore full indexation of the family allowance and child tax credit. My first petition comes from Vancouver Quadra.
I also have a petition which comes from Cape Breton-East Richmond, signed by dozens of petitioners who ask the Government to reconsider its position on family allowance.
1 have another petition from Parkdale-High Park, Spadina, Broadview-Greenwood, North York and Etobicoke which is signed by several dozen petitioners asking the Government to reconsider its position on family allowance, to restore full indexation, and also to restore the child tax credit.
I have a petition signed by people from Ottawa West asking the Government to reconsider its position on family allowance.
I have another petition from New Westminster and Surrey, British Columbia, signed by petitioners who are asking the Government to reconsider its position on family allowance.
I am also in possession of a petition, which 1 have been asked to table in the name of people from Westmorland-Kent and Fundy-Royal, which asks the Government to reconsider its position and to restore full indexation of family allowances. [Translation]
Mr. Speaker, I also have a petition signed by the constituents of the riding of Ottawa-Vanier, asking this Government to reconsider its position and to reinstate full indexation of family allowances and the child tax credit.

I have another petition signed by several dozen-

November 5, 1985
Petitions


Mr. Speaker:: I hesitate to interrupt the Hon. Member but it seems to me that he is presenting petitions on the same subject. The Member is an experienced Member who knows that the practice is to be as brief as possible. Perhaps he might just give us a list of where the petitions are from.


Jean-Robert Gauthier: Mr. Speaker, I appreciate that. I have so many petitions that I was not sure that they all claim to speak to the same subject. I was making sure by looking at them.
Following your direction, Mr. Speaker, I will table the petition from Spadina, Beaches and Davenport dealing with the full indexation of family allowances.
I have a petition from Mississauga North and Brampton asking the Government to reconsider.


Dave Nickerson: Mr. Speaker, I rise on a point of order. It would appear that all of the petitions that have been presented by the Hon. Member are petitions addressed to the Government. He has said that in his own words. Surely the only petitions that might be presented here are petitions to Parliament. That does not appear to be the case. Therefore, the Hon. Member ought not to be presenting these petitions.


Mr. Speaker:: Order. I appreciate the intervention by the Hon. Member for Western Arctic (Mr. Nickerson). He will know that petitions are often presented that are not entirely appropriate as to form and the Speaker has something to say about that question on the next day. Petitions are normally checked after they are presented.


Jean-Robert Gauthier: 1 will satisfy my colleague, Mr. Speaker. These petitions are addressed to the House of Commons of Canada in Parliament assembled. If he wants me to read the petitions, I will gladly do so. However, I was asked by the Speaker just to table the names of the ridings. Evidently we are talking about the Government, talking about a Government that is insensitive to family allowances-


Mr. Speaker:: Order, please.


Jean-Robert Gauthier: He is the one who started it.


Mr. Speaker:: No. The Hon. Member for Ottawa-Vanier is an experienced Member. Let me repeat once more that he knows that petitions should be presented in the briefest possible period of time. I invite him to conclude very briefly.


Jean-Robert Gauthier: Mr. Speaker, I have a petition to the House of Commons from the Capreol area in Ontario.
1 have another petition submitted to the House of Commons from Sudbury, signed by several constituents in that riding.
I have petitions signed by people from Montreal-Sainte-Marie, Windsor-Walkerville, Belle River, Essex North and Windsor-Walkerville again.
I have another petition concerning family allowance signed by people from Brampton-Georgetown.
I have another petition tabled-


Mr. Speaker:: Order, please. The Hon. Member knows the practice. He knows that if I allow this to go on for much longer it will be creating the appearance of a filibuster. He knows I cannot do that.
I am perfectly certain that the Hon. Member for Ottawa-Vanier will be here tomorrow with the rest of his petitions.


Sergio Marchi: Mr. Speaker, if you wish, I can finish the petitions for him. I have one petition, which was collected by Mr. and Mrs. Dorino Gobbo from my riding of York West. This petition also requests that the Government remove the deindexation of family allowances and restore full indexation, as part of the social contract that these families have had under the previous Liberal Government.


Mr. Jim Manly (Cowichan-Malahat-The Islands):: Mr. Speaker, it is my privilege to present a petition from residents of Saturna Island in the riding of Cowichan-Malhahat-The Islands. These residents are very concerned about the deindexing provisions of the family allowance Bill and its unfairness in comparison to the giveaways to the oil companies and the banks. They call upon the Government and the House of Commons to reinstate full indexation of universal family allowance and to rescind the unfair tax increases.


Rodney Edward Murphy: I have a petition signed by residents of Canada, in this case particularly from Flin Flon, Manitoba in the riding of Churchill. It is their opinion that the deindexation of universal family allowance and the massive cut-backs in the public commitment to child benefits are an unfair attack against women and their families, especially single-parent mothers. The petitioners humbly pray and call upon the House of Commons to reinstate the full indexation of universal family allowance and to rescind the unfair tax increases.


Mr. Stan J. Hovdebo (Prince Albert):: Mr. Speaker, it is my honour and duty, on behalf of a number of residents of the City of Prince Albert, to present three petitions which call upon the House of Commons to reinstate full indexation of universal family allowance and to rescind unfair tax increases.


Mr. Dan Heap (Spadina):: Mr. Speaker, it is my pleasure and honour to present a petition signed by a number of residents of Toronto from Spadina, Beaches, Scarborough West and other such ridings addressed to this House pointing out that the cut-backs in child benefits, on top of the sales tax increases, excise tax increases and other increases in income tax, are unfair and place an extraordinary burden on middle and lower income households. Therefore, the undersigned, your petitioners humbly pray and call upon the House of Commons to reinstate full indexation of universal family allowance and to rescind the unfair tax increases.


Michael Morris Cassidy: Mr. Speaker, 1 would like to table two petitions on behalf of my constituents from the riding of Ottawa Centre and other parts of Ottawa. These people object to the indexing of family allowances and, in
November 5, 1985

particular, to the amount of $600 million that will be taken out of payments to families. They call upon this House to restore the indexing of family allowances, the removal of which is proposed.



BANKRUPTCY ACT


Mr. Maurice Foster (Algoma) moved: for leave to introduce a Bill C-253, entitled an Act to amend the Bankruptcy Act (farmers and fishermen).


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


Some Hon. Members:: Explain.


Maurice Brydon Foster: Mr. Speaker, these amendments to the Bankruptcy Act would provide a legal mechanism for farmers and fishermen to apply to a court for an arrangement to settle debts.
It would provide a pre-foreclosure arbitration procedure by the court. Farmer-creditor arrangement legislation has been called for by groups, such as the Canadian Federation of Agriculture, the National Farmers Union, and others. Therefore, I introduce this Bill.


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

Douglas Grinslade Lewis: Mr. Speaker, I ask that all questions on the Order Paper be allowed to stand.


Mr. Boudria:: Mr. Speaker, I rise on a point of order. I was served with a notice a little while ago in this House stating that questions Nos. 450, 451 and 452 were to be replied to this afternoon. That notice was given to me approximately half an hour ago. 1 believe some explanation is warranted as to why replies are not to be provided when I was told previously that today they would be. Specifically, why is the Government stalling and delaying its answers to questions concerning trips of the former Minister of the Enrivonment?


Douglas Grinslade Lewis: Mr. Speaker, as always we are ready, willing and able to assist the Hon. Member by presenting answers to questions on the Order Paper.
As it happens, in defence of my colleague who is not here today, let me say that when I had to stand up for a second day in a row to request that all questions be allowed to stand, I asked why. I am told that the question of the acceptability of questions, whether or not these questions are in order, is presently under consideration. That is the information I have
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been given. I am sure that in due course we will have a satisfactory answer.


Mr. Speaker:: Shall all questions be allowed to stand?


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mrs. McDougall that Bill C-80, an Act to amend the Excise Tax Act and the Excise Act and to amend other Acts in consequence thereof, be read the second time and referred to a legislative committee; and the amendment of Mr. Marchi (p. 8360).
Douglas Grinslade Lewis: Mr. Speaker, immediately prior to the recess I was explaining for the record the reason that the Hon. Member put a motion on the floor to hoist the Bill for six months. After a full debate, during which many Members of the Liberal Party and the New Democratic Party have had an opportunity to contribute, the Government decided to allocate one further day for finalization of the debate.
At this point earlier today the unholy Liberal and NDP alliance ran out of steam, speeches and rhetoric. The House will know that we are in a period of 10 minute speeches and that members of the Opposition who have spoken will not be able to speak again unless the device used by the Hon. Member is used to freshen the list.
This comes at a time of severe embarrassment to the Liberal Party. The Liberal Party is decimated by the fact that nobody from the Quebec Liberal Party wants to go to the convention in Halifax this weekend and the leadership contest between the Hon. Member for Vancouver Quadra (Mr. Turner) and the Hon. Member for Saint-Maurice (Mr. Chretien) is heating up-


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


Mr. Speaker:: Rather than deal with it as a point of order, I might just remind the experienced Member of Parliament and Parliamentary Secretary of the rule of relevance.


Jean-Robert Gauthier: We do not mind the publicity.


Douglas Grinslade Lewis: Mr. Speaker, I was just relating the relevancy of the amendment to hoist the Bill to the difficulties of the Liberal Party in finding speakers to speak on the Bill. That is the binding relevance.

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Jean-Robert Gauthier: Mr. Speaker, I have a bona fide point of order.


Mr. Speaker:: On a real point of order, the Hon. Member for Ottawa Vanier (Mr. Gauthier).


Jean-Robert Gauthier: Mr. Speaker, there is a rule in Beauchesne's Fifth Edition that says that first, one has to be relevant to the Bill. Second, it says that you are not to impute motives. All I have heard for the last 35 to 40 seconds is the Member imputing motives, about which he knows nothing. In fact, my list is so long today that I could have Members speaking until twelve o'clock tonight, if the Member wishes to prolong the Members' right to speak. I have on my list Members who want to speak. If the Hon. Member has nothing else to say but that nonsense, he might as well sit down.


Douglas Grinslade Lewis: I have something else to say, Mr. Speaker.


Mr. Speaker:: Order. For the record I should rule that that is not a point of order, but I think the point is made.


Douglas Grinslade Lewis: I am sure that the entire House knew that, Sir, but I am pleased you put it on the record officially.
We will now see in the rest of this debate Members who have spoken before and who have made a contribution to Bill C-80. I am not sure I see anyone in the House who has not spoken before. Now that we have the device of the six months hoist, I invite Members who are about to retread their previous speeches to commence.


The Acting Speaker (Mr. Charest):: Resuming debate. The Hon. Member for Trinity (Miss Nicholson).


Jean-Robert Gauthier: She has not spoken yet.


The Acting Speaker (Mr. Charest):: Well, she will now.


Some Hon. Members:: Hear, hear!


Miss Aideen Nicholson (Trinity):: Mr. Speaker, may I point out, following on the remarks of my friend, the Hon. Parliamentary Secretary, that I am one of those now speaking on the motion who have not spoken yet on Bill C-80. His thesis does not have much to do with the facts.


Jean-Robert Gauthier: It never does.


Aideen Nicholson: When I spoke yesterday, Mr. Speaker, it was on the closure motion. I indicated that this Party has opposed Bill C-80 because we consider it unfair to low and middle-income earners and also because we think it does not make any economic sense.
It is interesting to find this morning that we got confirmation for this view from the prestigious Conference Board of Canada, which has generally been considered to take a rather conservative viewpoint of economic matters. The Conference Board of Canada points out that the tax increases in the last federal Budget will slow economic growth for the next few years.
In fact, it warns that economic growth will drop to a meagre 1.5 per cent per year, beginning in 1988, as the results of the cumulative measures introduced by the Government takes effect. The Conference Board blames the economic decline which it anticipates on tax increases in the Progressive Conservative Budget of May, which will take away spending money from most Canadians. It indicated that in 1986, the implementation of the more restrictive elements of last May's federal Budget would inhibit the expansion of consumer spending.
When the Government took power, Canada was at a point where it was recovering from a very serious world-wide recession, from which Canadians had been sheltered to some extent by the prudent policies of the previous Liberal Government. Canadians had not suffered as harshly as had people in other countries. Also, the Government inherited some building blocks for recovery and some elements of a good Budget. It has thrown away these advantages. In fact, in Bill C-80 before us we see an attempt, we are told, to grapple with the deficit. However, the attempt takes the form of piling on taxes like Pelion on Ossa on to low and middle income-earners, with the result, as we have heard from the Conference Board of Canada, that the money needed for a consumer-led recovery is disappearing. We will have a dampening of the economy and a dampening of economic growth. In fact, the deficit is more likely to increase.
Among the measures which we see before us in Bill C-80, there are tax increases on gas-two cents per litre in September, 1985, and one cent per litre in January. This will affect farmers. It is certainly already affecting food costs-and we have seen that food costs are up in the last month-because there is an energy cost in every food article. Farmers use energy. It is used for transportation, packaging, storage and retailing. Consumers will have to pay higher food costs as a result of this change.
Many of us have received mail from Canadian trucking companies indicating that the increase will make it more difficult for them to compete with their American competitors. So we see the risk of a loss of Canadian jobs.
A tax is imposed upon many categories of construction material including modular homes, concrete and asphalt. We have all received mail from people in the construction industry who are often locked into fixed cost contracts. For some small and medium-sized construction companies in particular, the fact that they now have to absorb this 6 per cent increase, because they are locked into fixed cost contracts, may mean going out of business. Yet this Government which claims to consult and to be responsive is not even willing to accept what has been proposed by some construction companies, that is, a method of phasing in the sales tax increase so as to allow them to deal with their fixed cost contracts.
Also we see taxes being imposed upon equipment and construction material used in energy conservation. The items which will be taxed at the 11 per cent level as of January 1 include heat recovery units, devices for extracting heat from
November 5, 1985

exhaust air or waste water for the recovery of energy, solar panels and tubes for collecting and converting solar energy, wood burning stoves and space heaters. The items to be taxed at 7 per cent will include thermal insulation.
The Government has clearly made a policy decision to put all its eggs in the oil and gas basket and to discourage Canadians from using alternative forms of energy. Not only that, it is discouraging homeowners who want to save a little money on energy costs by insulating. A price has to be paid for that.
I should like to turn to the sales tax on candy, soft drinks and pet food. Candy manufacturers also asked for time. They were willing to accept the sales tax, but they asked for a little time because many of them had prepackaged and priced their merchandise for their peak sales periods of Hallowe'en and Christmas. They were left with Hobson's choice-either redo the packaging with new prices or absorb the extra cost of the sales tax. The Government has been deaf to their request for a six-month delay.
Turning to the tourism industry, it has very serious concerns about the increase in gasoline tax which it sees as discouraging American visitors who form a large bulk of our tourist trade. That industry foresees a very substantial reduction in the number of American tourists visiting Canada each year, accompanied by a net loss of $135 million to the economy and perhaps over 5,000 jobs, when one takes into account the multiplier factor.
The list goes on and on. The direction is wrong for Canada. The new taxes discourage energy conservation. They impose a very severe hardship upon the construction sector of the economy. When we add the sales tax, higher fuel costs, CMHC cuts and the elimination of the Registered Home Ownership Savings Program to what the construction industry is facing, it is a heavy blow to an industry which was beginning to make a rather nice recovery from the recession.
The total amount to be taken out of the pockets of Canadian consumers in 1990 and 1991 as a result of these sales tax measures and the income tax changes may amount to $6.7 billion. Even this year the amount will be about $2 billion. This can only exert a damaging and dampening effect upon the purchasing power of lower and middle-income Canadians and, therefore, the economy in general.


Patrick Boyer: Mr. Speaker, most of the people I know would rather leave a burning building than rush into it. Most of the people I know would rather say hello to a friend than farewell. Most of the people I know would rather stand in Parliament and speak in favour of a tax reduction rather than tax increases. However, here I am rushing into the burning building to speak in favour of tax increases. I do so because in Bill C-80, the one under debate at this time, there are measures of great importance. I would like in the coming moments to look at three of them.
The first relates to the tax on cigarettes and what it raises in terms of general Government policy for the tobacco culture in our country and our economy. Second is the question of the
Excise Tax Act
tax exemption on certain health goods and what it means for many Canadians, particularly those who are disabled. Third, I should like to touch upon the measures included in Bill C-80 which represent an important step forward in terms of Government financial planning and accountability. I was also encouraged to rise to speak on this Bill because last night 1 heard from the Hon. Member for Surrey-White Rock-North Delta (Mr. Friesen) who had just returned to Canada from one of the eastern European communist countries. He said that no matter how bad things seemed in Canada, he was awfully glad to get back because in comparison with other countries, things are extraordinarily good here. It would be helpful for Hon. Members to place the relative amount of tax increases contained in Bill C-80 in that broader context. Members should look at them against the backdrop of the sincere effort of the Government to come to grips with the deficit that burdens the country and the future of the country.
Indeed, regarding the deficit, 1 would like to make another preliminary comment. At different times I was thinking about running for Parliament. I looked at the House in the 1960s, that great period of time when Government consisted largely of Ministers rising to announce new spending programs. It was a great expansionist era and politics was relatively easy then because politicians only had to decide what problem faced the country on which they could spend money. That was not hard politics, that was simply a matter of goodwill and the ability to spend money. It is the legacy of that approach which has now returned to haunt us in the eighties, a time when politics has become much harder and involves restraint in an effort to reduce the staggering deficit.
I have listened to the speeches made by Members opposite. As the Hon. Member for The Battlefords-Meadow Lake (Mr. Gormley) said this morning, any measure like Bill C-80 is bound to be fodder for the cannons of the Opposition. It is easy to shoot at the Government when tax increases are part of the legislation before us. However, the speeches that have been made in criticism of Bill C-80 have been very big on rhetoric and some of it easy rhetoric, but have not squarely addressed the reality faced by Government in the 1980s.
I now turn to the three measures I wish to mention briefly. One measure designed to increase Government revenue is the tax on cigarettes. This is the second time in the Thirty-third Parliament that a measure has been brought forward to increase tobacco taxes and it is the second time I have risen to speak in support of that increase for the same reason. I believe that the place of tobacco in our culture is something on which it is very difficult to formulate government policy. There are countries like China in which smoking is an indulgence followed by virtually the entire population. This kind of debate would never occur in China. However, in Canada we have now come to a point at which we are recognizing the extraordinary health hazards involved in the use of tobacco as well as the many related costs including the agricultural cost involved in having prime land dedicated to tobacco. A debate is now

November 5, 1985
Excise Tax Act
occurring in Canadian society which goes to the root of what we think of ourselves and how we wish to use certain products.
Hon. Members have recently raised the question of a contradiction in Government policy. Here we are raising tobacco taxes and the Minister of National Health and Welfare (Mr. Epp) has recently announced a spending program that will encourage Canadians and particularly younger Canadians to break the habit of smoking. Contemporaneous to that, there has been a measure of support for tobacco farmers. One could detect here certain inconsistencies.
I believe Government policy is reflecting the state of the debate and the shift in the thinking of Canadian society as a whole. I would hope that in the medium-term, we can move toward a policy that would see agricultural lands now given over to tobacco crops being given over instead to soybean or other crops that are certainly desperately needed in a world in which many people are starving and many more are going to bed hungry every night. I believe we have a broad social responsibility in that area.
Government policy regarding tobacco is clearly now in a state of transition. I hope it can continue along the same line so that within the next five to 10 years, we can see a true transition in the policy toward tobacco and no inconsistency on the part of a Government which is trying to get people to stop using a product that is so destructive to health. If this were to happen, the Government would no longer have the marvellous source of revenue it has from taxing tobacco. There is not a Government in the world that has not turned to levying hefty tobacco taxes in order to raise revenues. However, by the same token, in a society in which the use of tobacco products is alien, many Government expenditures for which those very funds are required including health care costs no longer need to come from the public purse.
The second point I would like to make concerns the tax exemption on certain health goods. I would like to applaud the Minister of Finance (Mr. Wilson) for blending an approach of fiscal responsibility with a compassionate understanding of the needs of Canadians. It did not fall on unhearing ears or to a hardened heart that Canadians, upon hearing plans for removing exemptions from certain products such as those used by diabetics, those who suffer from cardio-vascular diseases and those who suffer from respiratory diseases, requested that the Minister make a change. The Minister announced some weeks ago that the Government is prepared to listen and to modify its policy. As the Chairman of the Committee on Equality Rights, I would hope that the same view will prevail as we look more closely at a number of the tax exemptions available to the handicapped and disabled Canadians.
My final point concerns the effort to bring order and predictability to tax planning in Canada. I support this Bill because it introduces a comprehensive system of assessments, objections and appeals into the Excise Tax Act. This system is similar to the current system under the Income Tax Act and incorporates the recent improvements initiated by the Government in the areas of search and seizure and the presumption of innocence which defer collection and action on taxation until a
taxpayer has had an opportunity to resolve any disputes arising out of his or her tax liability. It is for the same reason that the Government has ended a provision inaugurated by the previous Government regarding the automatic indexation of tobacco taxes. We feel very strongly that it is Parliament that should have the opportunity to debate tax legislation. This point was made this morning by an Hon. Member from Manitoba. Again, I support this legislation because the removal of the automatic indexing of the tobacco tax is a step in the right direction. Whenever it has to be increased it is we here in Parliament, the elected representatives of the people, who will have a chance to speak to it.


James Ross Fulton: Mr. Speaker, I am pleased to have a chance to speak on Bill C-80 which, as all Members of the House know, is nothing more than another regressive tax Bill being dragged forward by the Government because it either does not have the guts or the will to go out and obtain the money where it should. In fact, somewhere between $30 billion and $50 billion could be collected from the corporations of the country. These are taxes which they are legally obliged and required to pay but because of the insufficient will of those who sit on the Government benches those taxes are simply not being collected.
It was interesting to listen to the Hon. Member for Etobi-coke-Lakeshore (Mr. Boyer). He did not bother speaking about the Little Egypt Bump-the $500 million to $1 billion going to Reichmann's. Instead, he talks about getting tobacco farmers in Canada to grow soybeans, as if those people who are listening to the debate today might think that somehow there is some sort of a comprehensive Government policy with respect to either the question of taxation or the question of tobacco. None of the additional taxes in Bill C-80 will go to help Canadians who are suffering health problems in relation to the fact that they have been either moderate or heavy smokers. In fact, these taxes will go into general revenues to help bail out the corporate friends of the new Government. It is quite clear that those friends are either the banks, the oil companies or certain individuals in Toronto who seem to be receiving the hundreds of millions of dollars which this Government likes to shovel off the backs of the trucks every day.
I would like to deal with how regressive these taxes are because they hit low and middle income earners the hardest, it then goes after the farmers, the fishermen and the forest industry workers in my constituency with a rather vehement beat. It blatantly attacks the tourist industry, as I will demonstrate in a few moments.
Let us consider the key elements coming forward from the May Budget which are contained in Bill C-80. The increases in the federal sales taxes and excise taxes have to be looked at very carefully because, of course, there is an essential difference between the two forms of tax. The sales tax is an ad valorem tax in that it is assessed as a percentage of the price of a good, for example, at 7 per cent, which is simply tacked on. Excise taxes are assessed at a fixed rate, as we recently saw in
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the first week of September with respect to the 2 cent per litre increase on gasoline. The main thrust of Bill C-80, of course, is to increase revenue though changes in both the scope and rate of the federal sales and excise taxes. There is no question about that. It is somewhere in excess of $3 billion, which point I will come to in a few moments.
There is one interesting point in the Bill for which I think the Government should be supported. I am speaking of the implementation of the presumption of innoncence concept. Although this does not help the overwhelming majority of taxpayers in the country who have their taxes lobbed off every two weeks, and who never really get an opportunity to use the clause, for some small business people and for fishermen, farmers and truck loggers in my constituency, it will be a rather useful change to the tax legislation.
The major increases in the Bill are as follows. The federal sales tax will be increased by 1 per cent effective January 1, 1986. Therefore, the new rate will be 7 per cent on construction materials. I know that will not help speed up the number of housing starts in the country. There will be a 7 per cent tax levied on cable and pay television services, which will certainly not help those people who are either in long-term care facilities or who are shut in at home for long periods of time for whatever reason. It will certainly hit low and middle income people much harder than anyone else. There will be a 14 per cent tax increase on alcoholic beverages and on tobacco products and an 11 per cent increase on other taxable goods. The total with respect to these increases in relation to Bill C-80 will be $990 million in fiscal year 1986-87 which will be borne directly by the taxpayers.
One initiative which has been fought consistently across the country and which has received a few rather narrow changes to it is the concept of broadening the sales tax base. The historic exemptions for candy, confectionary goods, soft drinks, pet foods and certain health goods are still basically in place. There have been some minor changes by the Minister of Finance (Mr. Wilson) in this respect. However, one which I find particularly irritating and one which is an example of colossal government stupidity is the broadening of the sales taxes to include energy conservation equipment. Studies which have been done by the National Research Council, by many provincial Governments and by many independent environmental organizations in the country demonstrate that that stands to be one of the stupidest things which has been done by the Government and one which will be hard felt in years to come as we see energy costs rising. This will be compounded by the fact that we will have used up so much more of our non-renewable energy base. To cut off funding to the scientific study of alternate energy, as we have seen at the NRC, and to cut back funds to universities and independent organizations across the country, whether it be with respect to wind, solar, biomass or any other alternate energies, is an example of a Government which his clearly in the pockets of the oil patch. Unfortunately for Canadians the Government is closing off one of the most promising small business enterprises which we have seen in this decade. Anyone who takes the time to study
Excise Tax Act
the figures would be quite astonished at the number of jobs which have been created and the long-term energy and cost savings both to the environment and to the economy. Those people could not find this concept of the Minister of Finance to be anyhting but stupid. The cost of this broadening will be some $785 million directly to the end of fiscal year 1986-87. It is interesting to note that not one single Member on the Government side has touched on the changes to the energy conservation area and what the impact will be in terms of job losses. We know that there will be almost $1 billion more in taxes on that sector; but no one from the government side has pointed out the large number of jobs which will be lost by so blatantly attacking a young and innovative new enterprise in Canada.
The excise tax will be increased on the following goods. Effective September 3, as we have already seen, an additional two cents a litre on gas and aviation gas had a hard felt impact on a constituency such as mine, which is about one-third of British Columbia, where many truck loggers are already hauling 200 miles each way in some cases. It does not take too many of these two cent a litre bumps to put many of these people practically out of business. We have seen the same thing occur with respect to many of the smaller airlines because there was already an increase of two cents a litre on diesel and aviation fuel. The Government sort of buries away and hides some of these increases, which is one reason I suppose we went metric with respect to gasoline. It is easier to hide from Canadian consumers just how great a lot of these jumps are in terms of taxation because of the change from gallons to litres. I see a resident expert on metric nodding knowingly from the government benches. I hope he will stand up and fight against this Bill. There is another one cent per litre on gas and aviation fuel effective January 1, and another cent per litre on diesel fuel and aviation fuel. The cost of these fuel tax increases to the end of 1986-87 will be $1,325 billion.
It is interesting that the Minister of Finance has not tabled in the House what the effect of this type of increase in taxation will be on farmers, fishermen, truck loggers, trucking companies and all those small airlines which fly not only in northern British Columbia but throughout Canada. I really object to this type of across-the-board taxation being brought in without knowing what the impacts will be.
When it comes to tourism I think the figures which I can put before the House will make it clear that these types of taxation increases are damaging some of the key industries in the country. The various per unit taxes on alcohol, with an increase of 2 per cent, and on cigarettes, with an increase of one cent per cigarette, are quite different. None of that money will go directly to deal with one of the most serious health problems not only in Canada but in the western world which is related to the consumption of cigarettes. There has been no serious attempt by the Government to deal in a comprehensive way with the issue of tobacco. The cost in this respect to the end of fiscal year 1986-87 is $440 million. Just on alcohol and tobacco alone we can see the Government stretching its long fingers into everyone's pockets on a fairly regular basis. The

November 5, 1985
Adjournment Motion
cost to the Canadian consumer with respect to these excise tax increases comes to $1,765 billion. When combined with the other hidden costs which the Minister of Finance has brought in to the end of next year it will amount to another $3.54 billion. I am sorry I do not have time to speak about tourism. However, let me conclude by quoting briefly from a speech of the Minister of Finance which demonstrates quite clearly how taxes in the last 10 years have gone from the individual taxpayer paying 50 per cent and corporations paying 50 per cent to corporations now paying 25 per cent and individuals paying 75 per cent. If we follow that through to the year 2000, individual taxpayers will pay it all. The Minister of Finance said on November 28, 1984, and I quote:
Our recent figures indicate that the effect of tax incentives has been to reduce the average federal corporate income tax rate from 36 per cent to 15 per cent... Particular activities qualify for very high rates of incentives, especially under certain grant programs. When the benefits from special tax incentives are added we are looking, in some cases, at an extraordinary generous level of assistance.
It is clear that the Minister of Finance, and the new Government, are giving all the give-aways to the rich and to the corporations and are loading all the taxes, particularly these kinds of taxes, on to low and middle income earners and are bankrupting many small businesses across the country.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
[ Translation]

The Acting Speaker (Mr. Charest):: 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 Don Valley East (Mr. Attewell)- Trade-Protectionist measures proposed in United States Congress; the Hon. Member for Algoma (Mr. Foster)- Agriculture (a) Sugar-beet industry-Plight of farmers, (b) Request for stabilization payment; the Hon. Member for Thunder Bay-Nipigon (Mr. Epp)-Marine transport (a) Construction of ferries, (b) Placement of orders.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mrs. McDougall that Bill C-80, an Act to amend the Excise Tax Act and the Excise Act and to amend other Acts in consequence thereof, be read the second time and referred to a legislative committee; and on the amendment of Mr. Marchi (p. 8360).
Maurice Brydon Foster: I am just delighted to have a chance to speak on Bill C-80 because it is a Bill which clarifies the fact that the Government is out to deceive the people and will certainly not keep its election campaign promises. I simply point to the two cents excise tax which was imposed on farmers, fishermen, forestry workers and on the mining industry on September 3 of this year.
During the election campaign last year the Government made a very strong promise that it was going to reduce taxes for farmers, fishermen, forestry workers and for the mining industry. On November 8 of last year it did reduce the excise tax by some three cents. It also gave an exemption to the petroleum compensation charge of 1.8 cents. On June 1, that exemption from the petroleum compensation charge of 1.8 cents a litre was eliminated but the price of gasoline did not go down. On September 1, the two cents excise tax was implemented so we see a new expensive tax loaded onto Canadian farmers. In fact, it is estimated that that tax will cost farmers something like $130 million. On top of that, there will be an additional tax of one cent on fuel starting January 1, 1987. At the end of December of next year the three cents excise reduction which has been in effect will be wiped out. Therefore, we will see farmers, fishermen, forestry workers and mining companies paying the full shot, plus a couple of extra cents per litre. This shows the kind of double dealing activity for which the Government is becoming famous.
The Hon. Member for Etobicoke-Lakeshore (Mr. Boyer) spoke this afternoon about the tobacco tax and tobacco farmers. If he is really interested in defending the Minister of Agriculture (Mr. Wise), he should visit St. Thomas this weekend. It is expected that 1,000 farmers will rally in St. Thomas to call the Government to account for its lack of action in agriculture. No industry has suffered more than the farmers from the farm debt crisis this past year, especially the young farmers. Yet the Government has failed to act. In fact, by this nine cents a gallon excise on gasoline, it is imposing even greater hardship on the agricultural community.
The Ontario Government changed from a Conservative Government to a Liberal Government last July and within a matter of two or three weeks, in the Budget brought down the provincial Government provided $50 million in relief for the farmers of Ontario. That is the kind of action which this Minister of Agriculture should be taking. Last year he put a moratorium on farm foreclosures. The situation has worsened.
November 5, 1985

We now have 23 per cent of our farmers, instead of 19 per cent, in serious financial difficulty and we see no action.
The Farm Credit Corporation was reduced from some $494 million of farm assistance, long-term loan funding, to only $90 million this year. On July 10 of this year, the Minister promised to bring in legislation on an urgent basis this fall with amendments to the Bankruptcy Act to provide a pre-foreclosure, pre-bankruptcy arbitration procedure for young farmers facing foreclosure. He started to walk away from this promise in September. Last week he was at the point where he was saying he would seriously consider it. This kind of lack of action is the reason the Minister of Agriculture is going to have to face many hundreds of young farmers in serious financial difficulty this Saturday when he goes home to his riding.
This Government has billions and billions of dollars. It has a $1 billion for a write-off for the Reichmann brothers in Toronto. It has $1 billion for Petro-Canada to buy 1,800 gasoline stations and refineries. But the Government has no money for farmers. This Bill exacerbates their situation because it imposes an additional two cents a litre, or nine cents a gallon, on farm fuel costs. It is a deliberate back-tracking and contravention of the very promises which the Government made. The Government imposes this tax at a time when the harvest is getting into full swing in western Canada. It is a travesty. It is unfair and unjust. On top of that the Government is going to impose an additional one cent sales tax on all farm supplies, including gasoline, which will probably cost a little over one cent a gallon. It will be imposing it on all farm supplies and goods.
The Government promised agri-bonds, long-term low-interest rate funding for farmers. It reneged on its promise. The Committee on Finance, Trade and Economic Affairs made a strong recommendation that we have an agri-bond program to help young farmers who are facing serious financial difficulty, but there was no action about that whatsoever in the Budget. The Government promised to revise Section 31. There was no action there. It promised to expand agricultural research and development. Yet the Government is cutting back $50 million on the estimates of the Department of Agriculture. That is reputed to be coming out of the research budget. The Government is reneging on its promise of an agricultural research institution in Quebec. The Toxicology Centre at the University of Guelph, which would have been very valuable to agriculture, was cut by the former Minister of the Environment. She did not have a clue about anything in the environment but you would think she would have at least learned something about that institution before cancelling it. This is just a totally disastrous history of lack of action or wrong action taken by this Government.
If we look at the rest of the Tory campaign manifesto we see that they promised to allocate the necessary funding to assist producers in refinancing their loans at current prevailing rates. We saw no action, but the Ontario Liberal Government,
Excise Tax Act
within a matter of a month, was able to announce a $50 million program of assistance. The Tories promised in the election campaign to impose an effective fast-track policy so that responsive action could be taken to protect producers by imposing import restrictions where necessary. What do we have? The Government imposed a 5.9 million pound limit on EEC beef imports to Canada but when the pressure was on, it was increased to 23.5 million pounds. The Tories said they would work to increase exports and stimulate production to meet export demand. Yet here we have a 5.3-cents a pound countervailing duty on all our hogs going into the U.S.


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


Mrs. Claudy Mailly (Gatineau):: Mr. Speaker, I think it is a pity that both the Hon. Member for Cochrane-Superior (Mr. Penner) and the Hon. Member for Skeena (Mr. Fulton) wasted their 10 minutes in exaggeration and puffery rather than addressing the problems of the day. I would particularly like to take up the suggestion of the Hon. Member for Cochrane-Superior that the Government of Canada should imitate the Liberal Government of Ontario. I would like to remind him that that Government brought in tax increases in its Budget. I would also like to ask him if he is suggesting that we should be getting the extra revenue we need to carry on with established programs and reduction of our debt, as well as trying to build up a cushion-


Maurice Brydon Foster: Point of order, Mr. Speaker. I know the Hon. Member for Gatineau (Mrs. Mailly) does not know what she is talking about, but I do not see the Hon. Member for Cochrane-Superior (Mr. Penner) in the House. If she is addressing her comments to me, I wish she would call me the Hon. Member for Algoma.


Claudy Mailly: Mr. Speaker, the same thing applies. The Hon. Member for Algoma (Mr. Foster) is just as confused as his colleague from Cochrane-Superior; it was his performance in Question Period which left his name in my mind. As for the Hon. Member for Trinity (Miss Nicholson), she had an interesting and creative approach to blotting out a terrible record which had the Hon. Member's Party thrown out of office in September, 1984. She spoke of prudent policies which brought us the economic renewal we are now just beginning to enjoy, that sent me to some of the background documents provided by the Department of Finance on the results of these prudent policies. For example, over the past three years our national debt grew at a rate of 25 per cent a year. That is almost three times the rate of growth of the GNP. Under the current fiscal plan debt growth has slowed to 17.7 per cent this year and will slow down further to 14.6 per cent in 1986-87. I fail to see where the prudent policies of the previous Government have brought us the economic renewal we are now beginning to see. Moreover, Statistics Canada, and DRIE surveys, indicate strong growth in investment for 1985, considerably larger than first forecast. Business fixed investment was up 17 per cent on an annual basis in the second quarter. I fail to see what that has to do with any policies of the previous Liberal Govern-

November 5, 1985
Excise Tax Act
ment. Elad we followed those same policies the effect would have been exactly the opposite. For example, when I look at another indicator, the value of the Canadian dollar, I can see that when the Liberal Party came back into power in 1980 it inherited a dollar at .837. By December, 1984, it had gone down to .756. It is now slowly climbing back because of the policies of this Government.
Another matter concerns the Hon. Member for Algoma; he mentioned the metric situation. He seems to have forgotten that it was the Progressive Conservative Party which put forward a motion in this House to allow the use of Imperial measurement in the sale of gasoline. Not only that, the Budget of the then Minister of Finance, now the Minister of Justice (Mr. Crosbie), presented to the House in 1979 was in Imperial measure. It was the Government of the Hon. Member for Algoma, when it came back to power in 1980, which instituted the metric system for the taxation of gas. Therefore, I think he should remember some facts even while he allows himself these very poetic and theatrical stories in this debate.
It is a fact as well that the Minister of Agriculture (Mr. Wise) has helped farmers more than all previous Liberal Governments. An example of that is that in our first Budget we introduced the abolition of the capital gains tax on the sale of farms. This will go a long way toward helping the passing on of family farms from parents to children. I have seen Liberal Member after Liberal Member as well as NDP Member after NDP Member get up in this House and condemn the abolition of this tax. They talk about a gift of $500,000 to supposedly rich people. What they are talking about is the average value of a farm in my riding. One can hardly say that riding is populated by very rich people. As well, the abolition of the capital gains tax, which is a gradual measure as Members are well aware, will help small business. Very often, when small business could have had access to capital, they were stopped from doing that because of this tax on capital gains. A business could not liquidate some shares it might have, for example, in some larger company or some guaranteed investment because of the fact it would face a very high tax on capital gains. This is not a measure for rich people, it is for small and medium businesses. Moreover, when we look at the statistics for the current economic situation, we see that housing starts averaged 185,000 in the third quarter. That gives us an annualized rate of 197,000 units in September. This is an increase of 19 per cent over the level of the second quarter, on top of a 24 per cent increase in the second quarter.
Obviously, Mr. Speaker, we do not enjoy increasing sales taxes. It is true that a sales tax affects everyone across the board and that it does not differentiate between people who are in a better position to make some sacrifices in things which are not essential to their lives. However, the fact remains that the choice was between increasing income tax for everyone and not being able to increase the child tax credit and not being able to continue with some of the programs which we have maintained. Our unemployment insurance fund, for instance, was exhausted by the middle of spring to the point where programs such as the Article 38 program, which was of very
useful to small businesses, no longer had any funds to extend in order to create jobs.
Something had to be done and the Budget which was presented was an attempt to try, in an over-all rather than an ad hoc way, to increase revenues to allow us to maintain and improve programs for people who need them most, and also to put us in a better position to take advantage of renewed confidence.
That is the key, Mr. Speaker. When the Member for Trinity was talking about the report of the Conference Board of Canada she omitted to say that you cannot measure confidence and, therefore, when a report such as the one of the Conference Board is issued, it only measures those indicators which are very visible and tangible. It does not measure intangibles such as investor confidence or consumer confidence which is much more important. Therefore, Mr. Speaker, I think that this debate has not really been to the credit of Members opposite. They have wasted time with exaggerations. It would be unparliamentary for me to say what they were doing in this House, but let us say that it was as far from the truth as we are from St. John's, Newfoundland.


Abram Ernest Epp: Mr. Speaker, when joining in this debate involves listening to some of the charges we have just heard, it requires a certain measure of self-control. It is obvious that the disagreement about what the effect of this set of tax measures may be can very easily lead to personal charges. That seems regrettable. I suppose that is one of the things that Members fall back upon as a response to the kinds of attacks that they would themselves probably have made if they were in the Opposition. In this case, of course, I am talking about Conservative Members. I expect that if they were in the Opposition and it were a Liberal Government proposing these things, they would be involved in saying the very same sort of things that we are saying now. Given that sort of reality, it is probably inevitable that in the process of defending the Government they will, in fact, stop the observations that are quite unworthy of Hon. Members. 1 shall endeavour, in my own comments this afternoon, not to do that sort of thing.
In taking part in this debate on Bill C-80, a proposal to increase federal sales and excise taxes, I want to provide a response to some of the observations we have heard, particularly from the Member for Simcoe North (Mr, Lewis), who suggested that we were merely producing noise over here which had no substance, that we had, in fact, no alternative, and that we were merely filibustering and killing time. That is one package of charges, Mr. Speaker, which is also, it seems to me, quite unworthy of Members on either side of the House.
To be faced with a closure motion so early in the debate on an important tax measure is, in itself, an action which all members of the governing Party should regret together with those of us in the Opposition. Surely, Mr. Speaker, to introduce time limitation on only the fourth day of debate, forcing us to a vote this afternoon resolving the matter,
November 5, 1985

suggests a kind of arrogance that one would have thought the Government would have taken longer in coming to. I know that coming to the House of Commons with 211 Members was a very, very heady sensation. The actions of the Government over the past year and other errors of omission, shall we say, which were committed, surely reflect the fact that the Government was so very sure in its numbers that it felt it could do anything. With much less than 211 Members it can, under the present rules, restrict debate and force us to express ourselves by voting against a matter, but in fact allow the measure to be carried through.
The traditions of Parliament are very, very strong. There are any number of Members of past Conservative caucuses who are spinning in their graves these days as they contemplate a Government bringing in time limitation motions and forcing matters to a vote, taking them out of the hands of Members of the House of Commons. It is not any kind of illegitimate use of the position of an Opposition member to oppose an action of the Government if one thinks it is unwise. There is abundant reason for saying that the tax measures with which we are faced in this particular Bill are unwise. Given that, we have a positive duty to the people of Canada to object to this measure with all the energy we have, knowing always that the rules of the House of Commons now impose very severe constraints on us. Particularly when we are few in number in the House, the possibility of our debating measures indefinitely is obviously very, very limited.
I suppose members of the Government might say that we are few in number because that is what the Canadian people thought of us on September 4 and therefore we should be quiet and let them govern the country as they see fit. Of course, the Canadian people do not see things quite that way any longer. Many, many Canadians know that on September 4, 1984 they made a very serious mistake. I think they are quite supportive of us in criticizing the Government's actions, as is, in fact, our constitutional responsibility, and in pointing out the weaknesses of the programs which the Government has put forward.
1 have suggested, Mr. Speaker, that what the Government has put before us in Bill C-80 is a mistake. Members in the Government caucus argue that the deficit had to be dealt with. I will not deny the truth of that proposition. It is a question of how to do it. What members of the Government, private Members included, do not talk about is one of the brute realities which the Auditor General of Canada has pointed out, that is, that the federal Government neglects to collect large amounts of taxes due to provisions such as those of the accelerated capital cost allowances which allow companies to avoid taxes. In just the past weeks we have seen some examples of that sort in the provisions which the Olympia & York interests were able to exploit to acquire Gulf Oil. More recent revelations of the Auditor General indicated provisions which Dome Petroleum was allowed to use earlier this year which will allow it to escape paying hundreds of millions of dollars of taxes.
Excise Tax Act
If in fact the Auditor General is correct in saying that the total of the taxes which are not paid year after year is $35 billion to $50 billion, then I do not understand how any Conservative who can think straight and add and subtract does not realize that the deficit is in fact a result of the tax laws of the country. There are people who are bearing the burden of taxation because the Conservative Government, which felt the same way as the Liberal Government did in the past, has refused to take large and effective action and has left the burden of taxation on individuals and small businesses while large business gets away with all kinds of tax breaks. Some solemn shaking of the head will not change the reality that if the total tax revenue that is not received exceeds $35 billion it will be more than equivalent than the entire deficit in the current Budget. Those Members who do not see the country from the Bay Street perspective will appreciate that if the Government does not close that collection of loopholes it will have no choice but to do exactly what is provided for in Bill C-80 and other measures. The Government will decide to tax the little people in Canada, the individuals, families and small businesses, while the wealthy and large businesses in this country will escape the burden of taxation.
Many Conservative Members will not be back to the next Parliament of Canada. Those Members will want to think about that because in their communities across the country, from Erie to Fraser Valley West and all the way to the East Coast, there are people who will realize that they will have less money to spend next year. They realize that the small businesses in their communities which depend totally on the people in those communities with whom they do business will suffer because of a decline in business.
There are those Members who believe that the way to create a prosperous Canada is to lower the deficit by cutting the expenditures on the one hand while increasing taxes on the little people, including small business and low and middle income Canadians. Those Canadians will say that they did not get the change for which they voted on September 4. Rather, they will see that they got another dose of Liberal Government as far as taxes are concerned and, therefore, ought to look elsewhere. It will be obvious to those Canadians that the old line Parties are exactly as described by predecessors in my Party and caucus over the years. They are Tweedledum and Tweedledee. As David Lewis would say occasionally, I believe, they are Tweedledum and Tweedledumber.
Surely the Conservatives should know better as a Government. The tax measures contained in Bill C-80 have the potential of ultimately reducing the revenues of Government so that the deficit is even worse afterward than it was before. Those Conservative Members should begin pushing the Minister of Finance (Mr. Wilson) and their causus into action. We want substantial tax reform. The people of Canada expect a reduction in the tax burden.


The Acting Speaker (Mr. Charest):: I regret to interrupt the Hon. Member but his time has expired.

November 5, 1985
Excise Tax Act


Mr. Fernand Robichaud (Westmorland-Kent):: Thank you, Mr. Speaker, for this opportunity to comment on Bill C-80. I say "comment", because I think at this point there can be no more debate. The Government intends to have all the measures proposed in this Bill approved, without considering the demands made by Members of this House. I may add that the demands of the tourist industry will also be ignored.
Mr. Speaker, I would therefore like to share with you a number of comments on this Bill and the tourist industry. I also would like to quote general statements made in this House by Conservative Members when they were in the Opposition. One Member said on March 14, 1984, and I quote:
In 1983, Canada had a record travel deficit, and an important cause of this deficit is the much higher price of gasoline in Canada compared to the United States.
Another Member said on January 30, 1984 and I quote:
The Canadian Automobile Association states that the high cost of gasoline has been a major culprit in deterring foreign travellers from auto touring in Canada. About 85 per cent of all tourism in Canada is by automobile.
Another Member said, and I quote:
The tourist industry is definitely pessimistic. We could take steps to reverse the trend in this crucial sector, and we would be well advised to start by reducing the federal tax on gasoline.
Those statements were made by Conservative Members when they were in the Opposition. I have yet to hear those Members raise the same points in the debate on Bill C-80.
Mr. Speaker, I also would like to share with you some data published by the National Conference on Tourism for Tomorrow. The paper is about the consultation process leading up the National Conference on Tourism for Tomorrow, and it says that more than 1,000 private citizens, businesses, professional associations and specialized groups in Canada gave their views on the problems being experienced by the Canadian tourist industry and the industry's potential. The 1,000 respondents said time and time again that current prices in Canada were too high, especially compared with the United States, and that this was very bad for tourism. Most comments were about the price of gas and alcoholic beverages.
Mr. Speaker, that is what our respondents had to say about the prices and more specifically about the price of spirits and gasoline. And here is what Bill C-80 brings us when we look at the price of spirits and gasoline, which are two major factors for the tourist industry.
Mr. Speaker, I may say, first of all, that the tourist industry is a very important one for Canadians. Tourism generates thousands of jobs. There are 600,000 persons working in this sector, which means that one out of ten Canadians work in the tourist industry. The industry represents 5 per cent of our gross national product and generates revenues of approximately $20 billion, which means it is well ahead of many other industries.
Mr. Speaker, nevertheless, despite the importance of this sector, the Government is doing everything it can to harm an industry that could create the jobs we need today.
To get back to the Bill before the House today, the proposed legislation provides for a 2 per cent increase in the tax on spirits. It also provides for an increase of 2 cents per litre in the tax on gasoline, diesel fuel and airplane fuel, as of September 3. We also find an increase of 1 cent per litre, effective January 1, 1987. The House will recall that the purpose of this increase is to pay for the full indexation of pensions for the elderly. The legislation also provides for extending sales tax to candy and soft drinks, pet food and certain health care products, which of course goes beyond the concerns of the tourist industry. We also find in this Bill the 1 per cent increase in sales tax, effective January 1, 1986.
So, to get back to the tourist industry: If we consider the price of spirits, we find that the Canadian Government is levying three times as much tax on a bottle of spirits as the U.S. Government.
Mr. Speaker, when Americans think about spending a few days in Canada, they certainly look at the price of spirits as a major factor, but it is only one factor among many others.
Mr. Speaker, I shall if I may get back to the price of gasoline, which is the most important consideration for people who come to visit this country by car. In fact, 85 per cent of the tourists who visit Canada, of Americans who travel across Canada, prefer the automobile over any other means of transportation. So if we look at the tax on gas which we were already exposed to in October 1984 . .. Does this mean I have one minute left, Mr. Speaker? Very well. Time flies.
Mr. Speaker, perhaps I may make a few more comments on the increase in the price of gas. If we consider the increase in the price of gas since the new Government came to power, we realize that the price has increased by 8 per cent. That increase is reflected in loss of visitors and especially loss of jobs, which works out to 18,500 jobs.
Mr. Speaker, I think we need these jobs back home, and I think people across Canada need these jobs.


Lloyd Axworthy: Mr. Speaker, I am willing to take a minute or two to register the very deep concern that members of my own constituency would want to express about the cavalier way in which this Government is dealing with an essential tax matter. We have watched Tory MPs bob and weave trying to explain the inherent contradiction in a tax Bill that is a repressive measure. It dampens growth, slows down the important initiative and dynamics of many vital sectors of our economy all for the sake of so-called deficit reduction, a deficit that is not reducing at all but is increasing.
November 5, 1985

It is with great sadness we see that once again the Government is unwilling to hear proper debate and that it has brought in closure so Canadians will not have an opportunity to hear full expression and point of view on a matter that affects them vitally in their own industries and in their daily consumption. It is a Government that we see time and time again has a strategy of keeping Canadians in the dark. Do not tell them what is going on is the new slogan of this Government; make sure we can do what we want. It has covert hidden agendas rather than trying to be prepared to defend our interests.


Some Hon. Members:: Oh, oh!


Lloyd Axworthy: The only time we find them coming awake is when they face the truth. The truth is not a pleasant thing to
face.


An Hon. Member:: Look who is calling the kettle black?


Lloyd Axworthy: The truth will be faced very clearly.
Once again we find a Government whose only capacity is to yell, bray and get excited when the truth is front and centre. This tax measure hits low income Canadians-


The Acting Speaker (Mr. Charest):: Order, please. [Translation]
Order, please. It being 5:45 p.m., and pursuant to order made Monday, November 4, 1985, in accordance with Standing Order 84, it is my duty to interrupt the proceedings and put forthwith every question necessary to dispose of the second reading stage of the Bill now before the House.

The question is the following one: Mrs. McDougall, seconded by Mr. Hnatyshyn moves that Bill C-80, an Act to amend the Excise Tax Act and the Excise Act and to amend other Acts in consequence thereof, be read the second time and referred to a legislative committee, and on the amendment of Mr. Marchi, seconded by Miss Nicholson that the motion be amended by deleting all the words after the word "That" and substituting the following therefor:
Bill C-80, an Act to amend the Excise Tax Act and the Excise Act and to amend other Acts in consequence thereof be not now read a second time but that it be read a second time this day six months hence.
The question is on the amendment. Is it the pleasure of the House to adopt the amendment?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mr. Charest):: All those in favour of the amendment please say yea.


Some Hon. Members:: Yea.


The Acting Speaker (Mr. Charest):: All those opposed please
say nay.
Excise Tax Act


Some Hon. Members:: Nay.


The Acting Speaker (Mr. Charest):: In my opinion the nays have it.
And more than five Members having risen:


The Acting Speaker (Mr. Charest):: Call in the Members.
Before the taking of the vote:


Some Hon. Members:: Order. Out, out.


Mr. Speaker:: Order, please. May I remind all Hon. Members that our practices have been that Hon. Members should be present in their seats at the beginning of the call of the question if they wish to vote.


Mr. Speaker:: I declare the amendment lost.
[ Translation]


Mr. Prud'homme:: Mr. Speaker, I just want to bring to your attention that 1 arrived a few minutes late, so I was unable to vote. I did not vote, but I want my constituents to know that I am in the House. I cannot run that fast between committees.


Ms. Copps:: On the same point of order, Mr. Speaker. The Hon. Member for Montreal-Sainte Marie (Mr. Malepart) and I were in committee which did not adjourn early enough-


Some Hon. Members:: Oh, oh!


Sheila Maureen Copps: This is a valid point, Mr. Speaker.


Some Hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. I take it the Hon. Member wishes to signal her presence here. I think she has done that.


Sheila Maureen Copps: My question of privilege is that the Chairman-


Mr. Speaker:: If it is a question of privilege, then I am sorry.


Sheila Maureen Copps: The Chairman of the committee continued on with the committee meeting. The Conservative Members walked out of the meeting leaving us without a quorum and the Chairman had not adjourned the meeting. Thus, I cannot see how we are supposed to end up in two places at one time.


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Shame.


Mr. Speaker:: Order, please.
The question is the following one. Mrs. McDougall, seconded by Mr. Hnatyshyn, moves that Bill C-80, an Act to amend the Excise Tax Act and the Excise Act and to amend other Acts in consequence thereof, be now read a second time and referred to a legislative committee. Is it the pleasure of the House to adopt the said motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


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


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


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


Mr. Speaker:: I declare the motion carried.
Bill read the second time and referred to a legislative committee.


PRIVATE MEMBERS' BUSINESS-PUBLIC BILLS   ELECTORAL BOUNDARIES READJUSTMENT ACT AMENDMENT TO PROVIDE SEPARATE REPRESENTATION FOR LABRADOR
Rodney Edward Murphy: that Bill C-228, an Act respecting the Electoral Boundaries Readjustment Act (Grand Falls-White Bay-Labrador), be read the second time and referred to the Standing Committee on Privileges and Elections.
He said: Mr. Speaker, I have the honour to present this Bill on behalf of many people from the area known as Labrador. In their presentation to Hon. Members of all three Parties, the residents of Labrador explained that they feel they need a separate seat to represent their interests in the House of Commons. They point to the special dispensation we have at the present time for Prince Edward Island, the two seats we have at the present time for the Northwest Territories and the seat we have for Labrador. In talking with Hon. Members of all three political Parties, they have made a point that Labrador is a distinct geographical entity with clearly defined borders. It stands historically, culturally, socially, logistically and politically apart from the rest of the province.
Labrador has the special geographical consideration and special community considerations which have allowed similar dispensations for Prince Edward Island, the Yukon and the Territories.
Precedent already exists under the Constitutional Acts of 1867, 1982 and special Clauses 51(a) Subsection 1 and Rule 6, Subsection 2. Labrador, already difficult to serve because of its geography, must share representation with mainland Newfoundland. The purpose of this Bill is to provide full and exclusive representation for that part of the province. In making my presentation, Mr. Speaker, I do so with the realization that it has little chance of being passed within the next 35 minutes. However, I do believe the people of that region of Canada deserve to have their concerns studied by the Committee on Privileges and Elections of this House of Commons. As you know, Mr. Speaker, at the present time the Committee on Privileges and Elections is looking into a redistribution Bill which was presented to this House by the Government House Leader. It is my intention, in making this speech in the House of Commons today-and hopefully other Hon. Members will indicate their support for this particular motion-that we ask the Committee on Privileges and Elec-
Electoral Boundaries Readjustment Act tions, on which I serve, to look into the special problems which are faced by the people of that section of the province.
As someone who comes from a large northern riding-and I am sure the Hon. Member for Skeena (Mr. Fulton) feels the same way-we understand the difficulties which a Member of Parliament has in getting around in a large geographical riding where there are no roads between communities and communities quite often have a small population and are spread out. What we are asking is not a blank cheque for the creation of a new seat for the House of Commons, but that the peculiar situation in which the people of Labrador find themselves be investigated by a Committee of the House of Commons and that we do all we can to try to meet the needs and concerns of the people from that region.
I am not going to take the full 20 minutes which would be allotted to me to speak on this Bill because there have been two votes and we only have 40 minutes left for the entire debate. What I will do in the next few minutes is to point out some of the things which have happened in the past. The idea of a separate seat for Labrador is not something which came from one political Party. It is not something which came from the New Democratic Party, the Conservative Party or the Liberal Party. What this is is a response to the efforts of the people of that region. They have founded a committee and that committee has written to people of all political Parties in the last few years. It is a committee which is asking for a seat encompassing the actual area of Labrador. They have written to the Premier of that province and he has indicated support for the concept. They have written to the representatives of the Liberal Party who have supported that concept. They have written to the New Democratic Party and our representative in the House of Assembly there has indicated his support for this proposal. Therefore this is something which has the support, if not officially of all three parties, nevertheless, the support of representatives of all three Parties. I believe it is certainly worthy of study and I would encourage Hon. Members of the House of Commons to indicate their support for this piece of legislation or at least indicate that they are willing to have the committee study particular problems of the people of that region.


Mr. Edouard Desrosiers (Hochelaga-Maisonneuve):: Mr. Speaker, the Hon. Member has described a situation which seems quite normal to me, and I think the Government should consider this request and examine the possibility of having a representative for Labrador. I think it is entirely fair and reasonable. As far as I am concerned, the Hon. Member has my support.


Patrick Boyer: Mr. Speaker, I am very pleased to have a chance to make some comments on Bill C-228 brought before the House by the Hon. Member for Churchill (Mr. Murphy). It was interesting to hear some Churchillian statements about the need to have adjustments for the electorate in Labrador.
8390

November 5, 1985
Electoral Boundaries Readjustment Act
To place this very important recommendation contained in Bill C-228 in a certain context, I would like to turn to several very relevant and timely documents. The first of those is the report of the study group which met at Halifax on September 25 to 27. This is the study group of the Commonwealth Parliamentary Association. It was my honour to be the chairman of that study group. Subsequent to the Halifax meeting the report was represented in Saskatoon before the full CPA Meeting. There appears at page 27 the observation that those Government officials charged with the limitation of electoral boundaries are at times accused of being concerned only with the numbers and of ignoring other factors such as community of interest, community of identity or historical patterns. Since a realistic tolerance level may be difficult to establish, these other factors may have to be given more emphasis. On page 28 of that same report, the conclusion of the delegates was expressed as the view that in redistributing electoral boundaries, equality of representation should be one of the main guiding principles. The principle of one vote, one value, should be uppermost while not precluding consideration of the political, legal and institutional factors. Those are the considered opinions of Parliamentarians from many Commonwealth countries who looked at the same subject which has been raised in Bill C-228, a Bill which would reflect and, indeed, recognize that Labrador has a distinct geographical entity with clearly defined borders and that it stands historically, culturally, socially, logistically and politically apart from the rest of the province, Newfoundland.
That brings us to the fact that, as the Hon. Member for Churchill has noted, the Government, acting through the Government House Leader, has brought forward legislation which will deal with redistribution of the constituencies in this Parliament. Bill C-74, to which I am referring, is at this stage before committee and will be reported back to this House by November 26. This is an important Bill because it not only amends the formula for deciding the number of seats in this House found in Section 51 of the Constitution Act, it would amend the Electoral Boundaries Readjustment Act, which is more relevant to the point raised in the Hon. Member's Bill. It would do so by providing to those commissioners who have the task of dividing up the boundaries in each province the power to depart in extraordinary cases from the 25 per cent rule. As Hon. Members know, the wording of the Act is that the population of each electoral district shall correspond as nearly as may be to the electoral quota for the province. That is to say, the quotient obtained by dividing the population of the province as ascertained by the number of Members of the House of Commons to be assigned to the province. We are suggesting two things in Bill C-74. First, that we change the wording "as nearly as may be" to "as close as reasonably possible". So we are, as the first step, introducing a doctrine of reasonableness. Second, we are amending the section to provide the possibility of going above or below the 25 per cent tolerance in extraordinary cases.
I think, Mr. Speaker, there can be no better example of an extraordinary case than that of Labrador. I am advised by one of my colleagues from Newfoundland that Labrador contains four, perhaps four and a half, electoral districts. Certainly it has a number of representatives in the provincial House, but at the federal level it is of course linked with one of the Newfoundland proper constituencies. The new provision being brought before Parliament in Bill C-74 will allow for the kind of suggestion that the Hon. Member for Churchill has made. That is why when he says here, as he did a few moments ago, that perhaps the Standing Committee on Privileges and Elections should look into the possibility of doing something like this, I would like to reassure him that we have done more than look into the possibility; the Government has brought in legislation which will permit the very kind of thing he advocates. Therefore, I draw from those comments the inevitable inference that the Hon. Member for Churchill will be fully supportive of Bill C-74, not only as it goes through committee but when it comes back to the House for a vote.
If I may be permitted a further point, I was reviewing the book I wrote four years ago entitled Political Rights, in which I talk about the quality of representation. I would make a final observation concerning the long-heard expression of one man, one vote, or one vote, one value. There is no question that in a parliamentary democracy such as ours that is a fundamental concept. However, as important as that doctrine may be, it is not the only doctrine relevant here. It is one of two, the second being the doctrine concerning the quality of representation. The concept of one vote, one value, means each of us must represent as closely as possible the same number of electors. At the same time an equally important reality is the quality of that representation. At that Commonwealth Parliamentary Conference in Saskatoon which I referred to a few moments ago, and the Hon. Member for Algoma (Mr. Foster) was there, we heard the very powerful speech by an Australian parliamentarian who said that democracy does not belong to Parliament or the Members of Parliament or the Government or any of the institutions, it belongs to the people. It is not a democracy if the people who live in concentrated urban areas can have ready access to their Member of Parliament any day of the week, any time they want to raise their questions and concerns, whereas in other parts of the country men and women have to wait weeks and perhaps months before the MP comes around to their community and talks to them personally to receive their representations, concerns, and proposals. We do have a geographically scattered population and, as the Hon. Member for Churchill indicates in the Bill before us now, that reality must be recognized in the way we distribute the constituencies.
If this exercise was nothing more than a mathematical computation, we could simply add up the Canadian population and have a computer tell us where the electoral boundaries should be. However, that is not the exercise which is involved when electoral boundaries are delineated. It is, rather, a delicate balancing act which seeks to take into account a
November 5, 1985

number of important factors, not the least of which is the accessibility of MPs to their electors, as well as having constituencies of a manageable size so that MPs can readily get around them to see those people they represent.
In conclusion, Mr. Speaker, the idea contained in this Private Members' Bill is a very important one. It is one which has already occurred to the Government and is fully reflected in the new provisions which will be part of the Electoral Boundaries Readjustment Act once Bill C-74 becomes law. For that reason I am sure the Hon. Member for Churchill will be exceedingly supportive of these initiatives by the Conservative Government to deal with a fundamentally difficult issue courageously so that long overdue reform of our electoral system is actually addressed, and so that the quality of representation comes closer to reality.


Mr. George Baker (Gander-Twillingate):: Mr. Speaker, let me say that I think the present quality of our representation is excellent, it could not be any better, covering the Labrador district. Let me also say that people in areas like Labrador sometimes wonder how it is that they, with a population of
30,000,	cannot have a seat unto themselves where they are geographically removed from Newfoundland. They look at another area of Canada which has less population in a federal seat and ask why they cannot have a separate seat. It makes much more sense for an area such as Labrador with a population of 31,000 to be designated as a separate seat than it does for some other areas of the country with less population to be designated as separate seats. Of course, Mr. Speaker, it goes back to the Constitution which states that you must have an amount of seats at least equal to the number of Senators that represent a particular province.
It was good news to hear the Government Member say a few moments ago that with the passage of Bill C-74 this very issue will be addressed by the Government of Canada. I do not know whether we can conclude from that that Labrador will get an extra seat through action of the Government, but it is certainly good news to hear the Hon. Members say, on behalf of the Government, that that problem will be addressed.
I think there is perhaps value in pointing out to the Chamber the reason an area such as Labrador deserves, in a way, to be treated differently than other areas of Canada. There is nothing strange about Labrador. Labrador is the same as Gander-Twillingate is in Newfoundland. Parts of Labrador have the finest facilities to be found anywhere. Labrador City is a modern community. However, due to the geographic location of Labrador, it has certain problems not experienced in any other part of Canada.
With regard to one of the problems, I could never figure out why, in our so-called social security safety net, we have rules based on times of year. There are fishermen all along the coastline of Labrador. The law states that the fishing season will run from May 15 to November 1. That is a strange rule to have in northern Canada because the ice is on shore after May 15. Consequently, the Canadian fishery can be operating all
Electoral Boundaries Readjustment Act along the coastline of Quebec, Prince Edward Island, New Brunswick, Nova Scotia and Newfoundland, but it cannot operate on May 15 of the Labrador Coast. That has a very important effect, Mr. Speaker. By law unemployment insurance for fishermen is cut off on May 15. What do you do if the ice is on the coastline and you cannot get out to fish on May 15 or June 15?
People who live in areas like Labrador have problems distinct from those in any other northern part of the country. Fishermen ask why they are treated the same as people in the so-called southern areas which you, Mr. Speaker, may call northern areas. Their question should be addressed by the Minister in charge of unemployment insurance who has commissions on-going in an attempt to find out what to do with unemployment insurance. Well, Mr. Speaker, those fishermen could tell her what to do with unemployment insurance. The answer is quite simple. You must treat fishermen like everyone else and then solve the problem on the Labrador coast. If a fisherman could draw unemployment insurance as a normal labourer does, that is, after a 10 or 20-week qualifying period, the problem would be solved. Perhaps that is too simple for the Government of Canada to see. Perhaps it is a little bit too straightforward and sensible for the commissions that are set up to re-examine the present unemployment insurance system. This is a case of outright discrimination against these people.
There is the other problem, Mr. Speaker, of weather. Federal-provincial relations are sometimes very important with regard to areas like Labrador. The Member of Parliament for Grand-Falls-White Bay-Labrador (Mr. Rompkey) was recently working on the problem of the installation of water and sewer facilities in Labrador. As often happens, about four or five months ago the federal and provincial Governments did not agree and the construction season has passed in certain areas on the Labrador coastline.
I suppose that these are some of the factors that went into the decision of the Hon. Member to introduce this Bill, if we interpret some of his explanatory notes correctly. He does say in the Bill that he would make Grand Falls-White Bay a separate riding with a population of 47,559. I do not agree with that. He would make Labrador a separate riding with a population of 31,318. I agree with that. I think we should allow the Bill to pass and then let the boundaries commission decide what the remaining districts in the Province of Newfoundland should be. Certainly the Hon. Member would not suggest that we should have a separate riding with a population of 47,559 when my riding is next door with almost double that population.
However, to facilitate matters, I suggest that we should pass the Bill through the Chamber this afternoon, as I am sure the Government is going to agree with it. We can then ask the boundaries commission to divvy up the remaining ridings in the Province of Newfoundland. Let us not forget, Mr. Speaker, that if the Government had allowed the redistribution to take place, there would have been an extra seat in Newfoundland and Labrador. However, the Government insists that we continue to have seven ridings in Newfoundland and Labrador

November 5, 1985
Electoral Boundaries Readjustment Act and merely redefine the boundaries. I just wanted to make that one point. I hope all Members will agree with this legislation. I take my hat off to the Member for Grand Falls-White Bay-Labrador who has done such a magnificent job on behalf of Labrador over the years.
IVfr. Keith Penner (Cochrane-Superior): Mr. Speaker, I agree with my hon. friend, the Member for Gander-Twillin-gate (Mr. Baker) who said that we ought to move quickly to pass this Bill and send it to a committee for further study. I would like to commend the Hon. Member for Churchill (Mr. Murphy) for bringing to the attention of the House an anomaly which ought to be corrected. Since redistribution is now under active consideration, this is an ideal time to do it.
I would like to say, by way of preface, that it was my privilege a number of years ago to travel with the Hon. Member for Grand Falls-White Bay-Labrador (Mr. Romp-key) in the part of his constituency that is designated as Labrador. It was a never to be forgotten experience for me. The difficult aspects of moving from place to place along that coast are deeply imprinted in my mind. For example, I recall being weathered in for four days at a place called Marys Harbour. Being weathered in there was different from what I or the Hon. Member for Churchill are accustomed to. Being weathered in usually means that there is a low ceiling or fog which makes it difficult for aircraft to come in and pick up passengers. In the case of Labrador, we were weathered in because of the extraordinarily high winds. On a number of occasions the aircraft we were using took to the air but made no progress at all because of the strong head winds. We had to come back for another day of waiting. That illustrates the difficulty a Member of Parliament has in representing a constituency with those conditions which face him or her regularly.
I listened with great care to the Hon. Member for Etobi-coke-Lakeshore (Mr. Boyer) in this debate because he is certainly the resident expert on matters related to redistribution and matters related to all electoral laws. I want to commend him very highly for the work he performed on behalf of all of us at a meeting of the Commonwealth Parliamentary Association earlier this year in Halifax to do a special study on problems related to electoral law. According to all reports that I have received, his contribution was outstanding.
The Hon. Member for Etobicoke-Lakeshore was absolutely correct when he said that the way in which the House of Commons represents a country cannot simply be a numbers fame that is arrived at by the use of a computer. The House of Commons must reflect, as accurately as possible, the nature and reality of our nation. This cannot be done by simply allowing representation by population to be the one and only guiding principle. We know this because we have already taken a number of steps with legislation in the past in order that more accurate or fairer representation could be given. For example, I draw to the attention of the House the fact that a few years ago we decided to introduce legislation allowing the
Northwest Territories to have a second seat. It simply was not realistic to have one constituency that included the western Arctic and all of the eastern Arctic. It made no sense at all. Therefore, the Northwest Territories is represented by two Members of Parliament. It would be unthinkable not to have the Yukon Territory represented. How would the House or Parliament ever be what it is if we did not have representation from the Yukon Territory? The Hon. Member for Churchill tells us that there is an anomaly in Labrador. I agree and I think we should move to correct it by the adoption of Bill C-228.
In concluding, I want to remind the House that my hon. friend, the Member for Notre-Dame-de-Grace-Lachine East (Mr. Allmand) has been giving serious consideration to a Bill that would allow the aboriginal people in northern Quebec, those people who come under the James Bay and Northern Quebec Agreement, to have representation in the House. They are the Cree of northern Quebec, the Naskapis people of northern Quebec and the Inuit. There should be a seat in the House of Commons in order to represent those people who in fact live under a treaty which we ratified in the House and which puts them into regular contact with the Government of Canada. They have no spokesperson of their own and 1 would support that Bill from the Hon. Member for Notre-Dame-de-Grace-Lachine East in the same way that I can support this Bill by the Hon. Member for Churchill. In the same vein, there is a situation in northern Ontario which I believe would justify a seat under exactly the same principle. The Nish-nawbe-Aski nation, which lives north of 50 degrees and occupies a territory which stretches from the Quebec border almost to the Manitoba border, do not have their own spokesperson in the House of Commons. It would make eminently good sense if that were a designated constituency for the purpose of representation in the House of Commons.
The Hon. Member for Etobicoke-Lakeshore was quite correct in drawing our attention to the Bill introduced by the Government, Bill C-74, which says that the Commission may, in extraordinary circumstances, depart from the 25 per cent more or 25 per cent less of the electoral quota for the province. Indeed, that does give the Boundary Commission powers an opportunity to respond to legitimate briefs and representations that they did not have before. Nevertheless, 1 still believe that we should follow the practice that we followed in the past in the case of the Northwest Territories and the Yukon, to provide legislation to give the Commission more direction and greater certainty. They could be told that although they have these powers under the Electoral Boundaries Readjustment Act, we believe that Labrador ought not be ignored, that the aboriginal people of northern Quebec ought not to be ignored and that the Indian people who are part of the Nishnawbe-Aski nation, the treaty nine configuration in northern Ontario, ought not to be ignored either.


Douglas Grinslade Lewis: Mr. Speaker, I appreciate the opportunity to participate in the debate on the Hon. Member's private Bill. Its essential purpose is to create a separate riding out of
November 5, 1985

Labrador. I appreciate the Hon. Member's concern for the people of that area and his proposal that that area of Canada should be made a separate riding on a geographical basis.
I listened with interest to other Members of the House who contributed to this debate. 1 want to make some specific and general comments. First, I believe that all of us could probably fight for different riding boundaries in different areas of the country, including those areas we now represent. However, the predicament in which we may find ourselves at the end of such a battle would be that we may have a House consisting of some 800 Members. While that may provide an opportunity for more one-on-one representation, the parliamentary process itself would be bogged down in terms of the number of people in the House. Where would we put these Members physically, and how would we support the cost of running the House of Commons financially? I suggest that we would soon find such an approach unworkable.
That does not mean for a moment that I do not understand the Hon. Member's argument that geographically, these people want a separate constituency. I also want to say that in my experience with the Hon. Member for Grand Falls-White Bay-Labrador (Mr. Rompkey), he has proven to be a Member who pays attention to the House and does a good job for the people whom he represents. 1 do not believe that the Hon. Member who presented the Bill or any Hon. Member who spoke on this subject are, by any means, demeaning the contribution of the Hon. Member in trying to represent people from Labrador and Newfoundland. 1 do not want this debate to leave that impression.
The Hon. Member's suggestion raises some problems. If we were to adopt the principle of the Bill we would have to consider its effect on other ridings in the province.


The Acting Speaker (Mr. Charest):: Order. I am always very sad to interrupt the Hon. Parliamentary Secretary but the time allocated for the consideration of Private Members' business has now expired.
S00)



PROCEEDINGS ON ADJOURNMENT MOTION

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

Bill Attewell: Mr. Speaker, I wish to follow up on my question of October 29 concerning the proposed trade negotiations with the United States. My question on that day was to the Secretary of State for External Affairs (Mr. Clark) concerning the potential problem of trade protectionism in the United States.
Adjournment Debate
We have been assured through the Prime Minister (Mr. Mulroney) that President Reagan would exercise his veto should extreme steps of protectionism arise in that country. The Secretary of State assured me of that.
Just going back a little, Mr. Speaker, on September 26, the Minister for International Trade (Mr. Kelleher) recommended to the Government that Canada begin trade negotiations with the United States at the earliest possible moment. Subsequent to that, the Prime Minister announced in this House that we would be sitting down with our ally, the United States of America, to begin the process of trade negotiations.
I would like to highlight the four steps involved in the process with the U.S. The first one we have already covered, that it is really the Minister for International Trade and the U.S. trade representative who submit their reports in accordance with the Quebec trade declaration.
Second, Congress has authority over tariffs. The administration cannot seek negotiating authority from Congress until it receives a proposal for trade negotiations from another country. That is the step we have taken.
Third, a formal proposal is required by letter from either the Prime Minister or the Minister for International Trade expressing our willingness to enter into negotiations of a trade agreement which would include tariff reductions.
Fourth, the administration sends the request for negotiations to Congress, which has 60 calendar days to consider the request. If Congress does not disapprove within this period, the administration may proceed to negotiations. There is no time limit in which the negotiations must be completed. That process has now begun.
I had the privilege to serve as an alternate on the special joint committee of the House of Commons and Senate on the subject of trade enhancement with the U.S. this past summer. We heard witnesses in Halifax, Montreal and in Toronto. Clearly, there are a number of concerns about this important topic. It may well be one of the most important decisions this Government makes. I suggest we should approach it with vigour and optimism but also knowing that we are up against a major ally which has some serious trade problems. That is not to say we should take anything away from what we are trying to do.
May I highlight the four objectives the Government has in mind. They include: security of access, expanded access in the U.S., a stable North American trading system and an ordered and predictable system.
If the decision is made at a later date to enter into very specific negotiations, I am confident that would be done over a protracted period of time. The recent free trade agreement signed with Israel, for instance, is to be achieved over a 10 year period.
Let me highlight how important our trading relationship is with the United States.

November 5, 1985
Adjournment Debate
From 1960, our exports to the United States accounted for 56 per cent of our total exports. In 1984 that figure had climbed to over 75 per cent. On the import side, 71 per cent of our total imports are from the United States. Exports, as a percentage of our GNP, have grown in a very favourable way from 12 per cent in 1960 to 25.8 per cent now. A full third of what we produce is exported. The export market accounts for two million jobs in the country. Over a 24-year period, some 474,000 manufacturing jobs have been created in Canada. All but a handful of those jobs can be attributed to export trade.
It is a very important topic, one which we need to approach carefully with our counterparts in the United States. Other trade regimes have been organized in the world. It is a different world out there. We must remain competitive. We cannot put our head in the sand and think that things are not happening. For example, the Japanese and the Koreans are very competitive. If we are to get to the Government's main thrust, which is economic renewal in the country, I submit that we need confidence and good judgment to approach the whole subject, in order to get the country moving on a long-term basis and to create much needed jobs.


Mr. Pierre Blais (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, the Hon. Member for Don Valley East (Mr. Attewell) has raised a very important question for the future of Canada.
As indicated by the Secretary of State for External Affairs (Mr. Clark) to the House on October 29, President Reagan initially provided the Prime Minister (Mr. Mulroney) with a strong political commitment to halt protectionism in cross-border trade in goods and services during the Quebec Summit last March. This commitment, which was highlighted by both Leaders as a key element in a declaration on trade, reflects their intention to create a more secure, predictable environment for trade between the United States and Canada. That is very important.
As Hon. Members may recall, the declaration on trade made at Quebec also included commitments to adopt measures to enhance access to each other's market, as well as a reaffirmation by both countries of their commitment to a strong, multilateral trading system. In addition, I would note, as did the Secretary of State for External Affairs last week, that the commitment to oppose protectionist legislation was renewed two weeks ago when the two Leaders met in New York.


AGRICULTURE-SUGAR-BEET INDUSTRY-PLIGHT OF FARMERS. (B) REQUEST FOR STABILIZATION PAYMENT
Maurice Brydon Foster: Mr. Speaker, I put a question to the Minister of Agriculture (Mr. Wise) on October 21 concerning the Government's intention regarding the sugar-beet industry in western Canada, especially in southern Alberta, where some 580 sugar-beet producers planted some 12,900 hectares in crop last year. It is a very important industry to southern Alberta. Some 550 jobs have been created in the plant operation at Taber. It is about a $170 million business.
This is the first year in 60 years that a sugar-beet crop was not actually planted in southern Alberta. As I said, it is a very important industry to that part of the country.
The industry creates about $500 million worth of business across the country. Four times since 1976, the Government has made stabilization payments. In 1976, it was $1.3 million; in 1977 it was $1.1 million; in the crop year 1981 it was $5.9 million; and in the crop year 1982, it was $10.2 million.
In a letter written to me several months ago the Minister indicated that he did not think he would be able to provide any stabilization payments. However, he indicated in a later exchange in the House that he did not remember actually sending that letter to me, although I do have a copy of it.
What is important tonight is that the Government commit itself to two things in order to help the sugar beet producers. First, the Government should commit itself to a stabilization payment for the 1983 crop year, a payment which has been estimated to be somewhere between $15 million and $18 million. I undestand that the Minister has stood up the producers five times. There were meetings which he had agreed to attend at which he did not show up and there were meetings that were cancelled at the last minute. The Minister of State responsible for the Canadian Wheat Board (Mr. Mayer) indicated in a meeting that he had with the sugar producers in late July that he would have a long-term sugar policy made available by October. October has come and gone and still no commitment has been made.
If there is going to be a sugar-beet industry not only in southern Alberta but in Manitoba and Quebec, a commitment by the Government to a stabilization payment for the 1983 crop year must be made and the payment should be due and payable now. There is no problem with the retroactivity of the payment. It used to be a legal problem but that was resolved with the passage of the stabilization Bill earlier this year.
It is essential that this payment be made now. As well, it is essential that there be a long-term commitment to a sugar policy. That commitment was promised by the Minister of State responsible for the Canadian Wheat Board who has been dealing with this problem. It is essential that the Government commit itself to this important industry.
The sugar-beet industry produces some $500 million worth of products used by Canadian consumers. It involves almost 1,000 jobs across the country, it is a vital industry. This is the first year that there has not been a sugar-beet crop planted in some 60 years. I hope that the Government will be able to make a commitment tonight to make the stabilization payment for the 1983 crop year of $15 million to $18 million, depending upon the calculations, as well as making a commitment to a long-term policy that will ensure that the industry continues.
Surely those figures to which I referred earlier regarding stabilization payments from 1976 are relatively small amounts in the scheme of things. That kind of payment is well worth making to save an industry that is important to foreign exchange and to the livelihood of at least 580 sugar-beet
November 5, 1985

producers in southern Alberta. As well, there are sugar-beet producers in Quebec and Manitoba who will likewise be jeopardized if this stabilization payment is not made and a long-term commitment to a sugar policy is not announced immediately.


Pierre Blais: Mr. Speaker, I am glad to have an opportunity to answer the Hon. Member's question. First of all, I can say that I know quite a bit about the situation. At the end of last week, I personally met with sugar beet producers from Southern Alberta here on the Hill, outside the House. I have met with them several times in the course of the year, and 1 even met them in Alberta. The Government has, in fact, already taken a number of steps to help sugar beet producers.
I would like to take this opportunity to clarify the situation raised by the Hon. Member. He felt there were anomalies between the federal Government's treatment of the sugar-beet industry and Ontario tobacco growers. Several points must be taken into consideration in this regard.
In the first place, the Hon. Member is in error when he says that the Minister of Agriculture authorized a $90 million payment to the tobacco industry. No money changed hands. Through the Ontario Flue-cured Tobacco Growers' Marketing Board, the Department provided a loan guarantee so that individual growers could receive cash advances to cover their needs while they store and market their crops the winter months.
The guarantee is handled under the Advance Payments for Crops Act. This Act has been used by a wide range of producer groups since it was passed in 1977. Under this Act there is a $400 million contingency liability which guarantees advances made to producers through their marketing organizations. The marketing organization obtains a loan from a bank or another financial institution and then makes advance payments to its members. The federal Government guarantees the loan and pays the interest charges until the advances are repaid. 1 should mention that there are seldom defaults under this program. Some 99.9 per cent of advances are repaid.
The Tobacco Growers' Marketing Board has applied for this guarantee every year for the past five years. To date, there have been no defaults on advances made to tobacco growers. The sugar growers have never applied for assistance under this program. The sugar growers have requested a stabilization payment, that is, a support payment to compensate for the fact that the bottom has fallen out of the world sugar market and farmers are not receiving adequate returns on their sugar-beet crops.

Mr. Speaker, last April, the Government, announced an $8 million aid program-
Adjournment Debate


George Albert Proud: You are always reading from English texts prepared by the Department-


Pierre Blais: -If the Hon. Member for Saint-Denis (Mr. Prud'homme) had been present at the beginning of my speech, he would know that I mentioned 1 met them personally, and that I am acquainted with the entire process that concerns Canadian sugar beet producers-


George Albert Proud: I was in the lobby- I was listening to you on television-


Pierre Blais: -We met them, as 1 said, we set up a program and we discussed with them-


The Acting Speaker (Mr. Charest):: Order, please. I am sorry to have to interrupt your comments. The Hon. Member for Thunder Bay-Nipigon (Mr. Epp).


MARINE TRANSPORT-CONSTRUCTION OF FERRIES. (B) PLACEMENT OF ORDERS
Abram Ernest Epp: Mr. Speaker, I appreciate the opportunity this evening to say something more about the situation in the shipbuilding industry which is of concern to many Canadians. I appreciate this opportunity particularly because I am the only opposition Member with a shipbuilding or ship repair facility in his riding. In my case it is the Port Arthur Shipbuilding Company.
I am concerned about the state of the industry nationally and I am concerned about the industry in my own riding. In my riding there is a great deal of anxiety among the workers of the Port Arthur Shipbuilding Company with respect to the lack of orders the company has received. The management of the company has pointed out to me the difficulties which they face when competition for repair work is so severe because of the relatively few orders coming to the shipbuilding yards across the country, specifically on the Great Lakes.
There is much reason for concern about the shipbuilding policy of the Government. I have had the opportunity to articulate some of those concerns. I must say that as days pass and the Government says nothing, makes no announcements, I become more and more concerned. After all, more than four months ago, on June 27, I asked the Minister of Regional Industrial Expansion (Mr. Stevens) whether or not he would wait months and months more to provide some answers to the needs of the shipbuilding industry. And he said in one word, "no". But four months have in fact passed and everyone in the industry, and we in the House of Commons, await a statement of policies to follow which would make a real difference.
I am, however, not addressing those general considerations so much as the particular question of the addition of vessels to the fleet of CN Marine in the Gulf of St. Lawrence. I address that particular matter for a couple of reasons; First, because of

November 5, 1985
Adjournment Debate
the fact that Government Orders are of enormous importance to the industry, given a lack of appropriate policy and, second, because as La Presse has pointed out just in the last day or two, there are in fact fewer vessels under construction in the shipyards these days than there are shipyards in existence. That underscores the fact that when Government does nothing in the way of commercial orders, it becomes imperative that the possibility of public orders. Government contracts of various sorts which now provide some business, remains a possibility.
What we quite specifically have for our focus is a statement by the Minister of Transport (Mr. Mazankowski) which was made almost a year ago. I am going to read that statement because it is quite central to our concern, and I quote from Hansard, page 217:
Mr. Speaker, in answer to the Hon. Member's question, it really is a twofold proposition. There will be a rationalization of the Gulf ferry services and the coastal ferry services. As a matter of fact, there will be an additional three new vessels on the Gulf service and one new vessel on the Newfoundland-Labrador coastal service. These vessels will be of the latest state of the art; they will be faster, they will be larger, and they will provide more flexibility and more reliable service. Not only that, this will have a tremendous impact upon the shipbuilding industry and, therefore, will create jobs.
That statement on November 14, 1984, is of enormous importance to people in the industry. When reports surfaced last week that CN Marine might in fact be allowed to import a vessel rather than ordering and having built in Canada a state of the art vessel, I had real reason to raise questions in the House. The Minister's answers were not satisfactory. They were in fact cause for the gravest concern.
In 1979, may I remind you, Mr. Speaker, and Hon. Members of the House, the Conservatives had achieved power and came to office on the basis of many promises, including the promise to build up the shipping industry, to encourage it. It allowed CN Marine very soon thereafter to obtain from Scandinavia two vessels on long-term lease, and by that action prevented the opportunity for construction of these vessels in Canada. At the moment the shipbuilding firm of Versatile Davie in Lauzon, Quebec is near completion of the Caribou. That is one addition to the CN Marine fleet.
The question is will the promise of the Minister of Transport on November 14, 1984, that another such vessel would be built in Canada, be kept? The Minister's statements a week ago today were anything but reassuring. In fact, there was enough cause for concern that one of his colleagues, the Hon. Member for Levis (Mr. Fontaine), presented a report to him on the following day, Wednesday, which pointed out that the cost advantages which CN Marine was putting forward with respect to a vessel from Scandinavia were largely elusory. If one takes a purchase price, of, let us say, $40 million and converts it into U.S. dollars, then puts a duty of 25 per cent on that, then applies the refitting effort which would be required to bring the vessel to scratch, whether it was done outside or within Canada, one would in fact end up with a vessel cost of perhaps $110 million in Canadian dollars. Versatile Davie is completing construction of the Caribou, I am told, at the price of about $117 million. So the difference is very small.
You can appreciate, Mr. Speaker, that the construction of the vessel at Versatile Davie would create 2,000 person years of work so that 50 per cent of that cost is likely to go for wages and an additional very large amount of money to Canadian suppliers of materials and so on. We can see that the impact on the economy of the Quebec City area, and of suppliers beyond that, and the return to Government in the way of income tax and corporation taxes, would be quite sufficient. On the other hand, if the work is not there, we are going to see people on unemployment insurance and the Government will be forced to incur other costs while CN Marine tries to get away with saving a little.
The question is then: Is the Government going to keep its promise? Is the Minister of Transport going to stand by his words of November, 1984? I look forward to a response from the Parliamentary Secretary who I know has the interests of shipbuilding very deep at heart. What will the Government do?


Mr. J. M. Forrestall (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, the Hon. Member's comments are appropriate and reflect a genuine concern. I assure him that those concerns are shares by this Government.
The Government is aware of its responsibility to provide good and efficient ferry services at a reasonable, efficient and effective cost. To this end the motor vessel Caribou, constructed at Davie shipbuilding, Lauzon, Quebec, will operate on the North Sydney to Port-aux-Basques ferry service. This vessel, built at a cost of $121 million, has a capacity of 350 automobiles and 1,200 passengers, and is expected to commence service in early 1986. As well, a new passenger-freight vessel is under construction at the Port Weller dry docks in St. Catherines for the Newfoundland and Labrador coastal service. The vessel, built at a cost of $20 million, will have a capacity of 130 passengers and will replace the aging motor vessel Bona-vista which has served now for some 28 years.
Both these projects give work to Canadian workers, using Canadian materials in Canadian shipyards. The motor vessel Caribou was the first phase of the rationalization of the Gulf ferry services undertaken by CN Marine. The new service will consist of the motor vessel Caribou, a roll-on-roll-off vessel which will be assigned to carry containers, and a new passenger vessel for the North Sydney-Argentia service. The latter ship will replace the motor vessel Ambrose Shea and be similar to the Caribou but with additional passenger cabins.
The Minister of Transport (Mr. Mazankowski) informed the Hon. Member, in response to his question of October 29, that methods of acquisition of the roll-on-roll-off vessel and the second passenger vessel are under consideration by CN Marine at this time.
In reply to the Hon. Member for Levis (Mr. Fontaine), on a similar question on October 31, the Minister gave his assurance that the report sent to him by this new yet very knowl-
November 5, 1985

edgeable Member would be taken into very serious consideration during the course of these evaluations.
We remain vitally concerned about our Canadian shipyards. If it were not for Government orders, our shipyards, already in serious difficulties, would be in dire difficulties.
Adjournment Debate


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


[Stage Direction]
The House adjourned at 6.28 p.m.
[Stage Direction]
Wednesday, November 6, 1985