1985-10-28

OFFICIAL REPORT

[Stage Direction]
FIRST SESSION-THIRTY-THIRD PARLIAMENT 34 Elizabeth II

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Published under authority of the Speaker of the House of Commons by the Queen's Printer for Canada
Available from Canadian Government Publishing Centre, Supply and Services Canada, Ottawa, Canada K1A 0S9.
[Stage Direction]
Monday, October 28, 1985


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The House resumed, from Thursday, October 24, 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.
Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, I am pleased to have the opportunity this morning to speak on Bill C-80 which relates to the Budget delivered on May 23 of this year. That Budget has had very detrimental effects on low and middle-income people in this country. It has had a very retrogressive influence on the Canadian economy and on its prospects for the future.
This morning I would particularly like to discuss matters relating to the Budget as they in turn relate to energy. The Budget stipulated that the excise tax on gasoline be increased by two cents per litre on September 3 and another cent per litre on January 1 of 1987. There will be a further increase in taxes as a result of the Government backing away from the partial deindexation of old age pensions. Although we are very pleased that the Government backed away from that policy, we feel that it is very unfair to make up for it through the price of oil. It seems that the Government believes in give and take and this belief is costing consumers a bundle of money. The Government believes in giving lots of money to the major oil companies through such vehicles as the Western Accord and the Gulf tax deal. The Government can give millions of dollars to bail out banks which failed due to a multitude of bad loans and bad management. However, the Government can only take from consumers.
Since the new Government came into power the consumer has had to face more and more tax increases. The Government tried to take money away from senior citizens and when it backed away from that policy the consumer, rather than big business, ended up paying for it through an increase in the price of gasoline. The consumer ends up paying through the nose because it seems that the Government cannot see beyond the end of its nose. The Government promised that the consumer would benefit under deregulation. The consumer has not benefited one bit from deregulated prices. Oil prices are falling everywhere except in Canada. Thanks to the generosity of spirit which the Government is displaying the consumer in Canada is experiencing more and more tax increases.
I would like to point out the inconsistency, the ambivalence, and the complete disregard shown by the Government by referring to some of the things it said and some of the indications it has given to the people of Canada. After a meeting with Ministers of Energy in late January it was agreed that companies operating in Canada be allowed to negotiate their own deals with U.S. importers without having to wait for federal approval of export prices. At that time, the Minister of Energy, Mines and Resources (Miss Carney) said that this move by the federal Government in realizing export pricing controls is an important step toward ultimate deregulation of Canadian crude oil prices and marketing procedures. She went on to say that it was impossible to project what effect a new energy pricing policy would have on consumer prices. She was prepared to go ahead with this program of deregulation without any idea what effect it would have on energy prices in Canada. At no subsequent time did the Government give any indication of concern about what would happen to energy prices here. Why did the Minister agree to deregulation if she did not have any idea of what effect it would have? It does not make any sense that she would have agreed to that.
In April, an energy expert with the Consumer's Association of Canada said that consumers can expect very significant increases in gasoline prices after June 1, the time of deregulation. That expert was Bruce Wilson, the association's energy committee chairman. The Government and the Minister of Energy, Mines and Resources were told that oil company officials reluctantly admitted that tax cuts will not mean cheaper prices at the pumps.
Austin Torrell, of Gulf Canada Products said that gas prices are largely contingent on the price producers pay for their crude oil. He said: "As a refiner and marketer of petroleum products, we see no change in the price consumers will pay for gas as a result of these cuts unless there is a change in crude oil prices". There has been a change in crude oil prices internationally. There has been a reduction of oil prices to consumers everywhere but Canada.
Why has that happened? Why have oil companies not passed those reduced costs of oil to consumers in this country? It is obvious that the producers believe they have the support of the Tory Government in Ottawa and that there will not be any ripple effect if the people in this country are charged as

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much as the market can bear. This is an extremely callous, unfortunate and self-defeating action by the Government, as it is realizing today.
The Government has taken away consumer programs such as the Canadian Home Insulation Program and the Canadian Oil Substitution Program. Just in case consumers save money by insulating their own homes, the Government decided to tax insulation materials that consumers would have to buy as a result of the elimination of this program. Furthermore, if consumers try to save money on fuel tax by heating their homes with wood, the Government decided to tax wood stoves as well. Apparently the Government is attempting to tax consumers from every angle. First, it eliminated the program, then it taxed insulation products, and finally it taxed wood stoves when consumers tried to go off oil. The Government is making an incredibly lethal attack on consumers in this country.
It has told Petro-Canada to make profits, beginning by decreasing competition so that consumers will not benefit from any price war that may occur. Rather than worry about consumers in the future, the Government is encouraging us to become more dependent on foreign imported oil so that consumers will be left scrambling when the price sky-rockets. It will guarantee our reliance on foreign oil by cancelling the incentive program which provided incentive to find future oil and gas supplies. The Government has not given any thought to a replacement program for the Petroleum Incentive Program. This is devastating to frontier exploration, including offshore exploration in this country.
Let us see how these facts relate to the attitude of the Minister of Energy, Mines and Resources and the Government. When the Minister was speaking at an energy conference on March 8 in Vancouver, she described deregulation as much better for Canadian consumers. This is especially true in today's world of falling international oil prices because we cannot expect and be complacent about the fact that lower prices will continue over a long term. Therefore, we have to do two things. The first is to build in-protection for consumers should international prices surge. The second, is to get on with the job of conservation. The Minister said on March 8 that we have to protect our security of supply and that we have to get on with the job of conservation.
Let us deal with the second point first, that of getting on the with job of conservation. The Minister said this on March 8 and on March 31 the Canadian Oil Substitution Program was terminated and she cut back on the Canadian Home Insulation Program. The final blow in the heart of the Canadian Home Insulation Program will be dealt with in March, 1986. She is talking about conservation and at the same time she is doing away with the conservation program. She is saying: "We do not need to give financial incentives. We do not need to have this sort of program. We are going to give people information so that the conservation program will continue". That conservation program will not continue to the same degree because
the Government has stabbed the program in the back. Dollar for dollar the Government and the country got more benefit from energy spending on conservation than it did from any other energy expenditure which it instituted.
Let us look at number one. The Minister has said that first we must build in a protection for consumers should international prices surge. She is saying that we have to develop our energy sources. This is the same Minister who today is saying that we are working on a replacement for the Petroleum Incentive Program. On March 8 she said we must build a protection for consumers should international prices surge. Last November she said that her objective was to prevent a lull in offshore activity. How do you reconcile the statements of last November and the statement on March 8 with what this Minister is doing to the Petroleum Incentive Program, taking away the incentive for offshore, taking away the incentive to develop the energy sources off Nova Scotia and Newfoundland and in the Beaufort Sea, Mr. Speaker? Not only that, the Minister just recently postponed the bi-provincial Husky upgrader project. The former Liberal Government has promised a loan guarantee of $780 million plus a $50 million grant to cover construction costs. The Minister has completely gone against what she has been saying. It is incredible that she says one thing and does another.
The Government has no regard for what it is saying. It has no regard for matching what it says to what it does. It is insulting to people, not to mention its absolute devastation of our energy program. The whole this is ludicrous and it gets wilder and wilder.
The Government is now toying with natural gas pricing. It is bad enough that the Government did not come up with something in the Western Accord last spring. The Government said: "We are going to provide a natural gas pricing arrangement by November 1". To begin with, November 1 was not a good date. It should have been September 1 or even October 1. November 1 is the beginning of the contractual year for natural gas contracts. What she is saying is, "At best we are going to give you an arrangement on the very day you must enter into your contract for the next contractual energy year. It is ludicrous to wait that long, but anyway the Minister gave the date of November 1.
The Government has had plenty of time to reach an agreement but we still do not have an agreement on natural gas prices. The whole picture on natural gas pricing and exporting, the whole structure of natural gas commerce is in a state of limbo. November 1, is next Friday, which is four days away. Why has the Minister placed this very important aspect of our economy in a complete state of limbo and confusion? Natural gas exports mean $4 billion per year to Canada. She is taking a $4 billion benefit to the country and throwing it into a complete state of confusion.
I should like to talk for a moment about the offshore, the replacement of the petroleum incentive program and the amendments to the Canada-Nova Scotia agreement. After the
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signing of the Western Accord, the Minister of Energy was asked about a new agreement for Nova Scotia, and she said: "Give me a weekend to rest". Boy, was she tired? That was months and months ago, and still we do not have anything from the Minister or from the Government. It seems that Nova Scotia, and perhaps Newfoundland, if this complete inadvertence and disregard continue, will suffer tremendous problems as a result of the lack of a fiscal regime on the part of the Government. Once again the words of the Minister are not followed by action. Her words do not mean anything to her. 1 tell Hon. Members of the House that her words mean an awful lot to the people of Canada. They are not positive, but they are starting to realize that the Government just does not care about the country. It does not care what it says, and it does not care whether what it says is followed by action. It believes it need not do what it says it will do.
When the Western Accord was announced, the Minister said that offshore projects were protected; we all remember that. Also she said that she had received assurances of a reinvestment of $800 million per year from companies working in the Atlantic offshore and that removing five different taxes meant that they will invest more money in the East Coast. My, oh my, if they are investing more money in the East Coast, it has to be the best kept secret in the country. Last year, there were 10 rigs drilling off the shore of Nova Scotia. Now there are two. Companies are leaving Halifax and Dartmouth in droves. The whole offshore is crumbling because the Government has refused to put in place a fiscal regime which would indicate that it is giving any support at all to the Venture project in Nova Scotia.
On March 29, the Minister said: "The companies involved in the drilling ventures told me personally that the removal of the PGRT, which is a revenue tax, would be one of the greatest incentives to continue drilling in the Scotia Shelf'. Imagine, imagine! Are those not just yummy words? Then, when referring to the Leader of the Opposition (Mr. Turner), she said: "I can assure him that there is nothing in the Accord that does any damage at all to Newfoundland and Nova Scotia".
This Government, which was practically paranoid about the reduction of the deficit last spring and according to its own terms, supposedly reduced it by $2 billion, has completely done away with that reduction. In fact, the removal of the PGRT, which is a gift to multinational oil companies, and the bail-out of the banks, each meaning $1 billion to the taxpayers of the country, have completely wiped out any reduction which may have taken place in the deficit.
The Government made some decisions on energy which it felt it could make and from which it could gain some political points. If it was a easy decision, the Minister of Energy and the Government made it. They did not have any regard for consumers or for what increased prices would result. They felt that if they could get some political points from it, they would do it.
It seems that the energy decisions are a little more difficult now. Perhaps the pressure groups are not all on one side or the
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other. It is not clear-cut. There will be a down side and an up side. The Government is frozen at the switch, and Canadians are paying the price as consumers and they are paying the price by the reduction of impetus and confidence in our energy program.


Mr. Don Blenkarn (Mississauga South):: Mr. Speaker, there is no tax that is a good tax. All taxes are in some sense a drain on the productive end of the economy, to pay the expenses of Government. So it is easy to argue that tax increases, such as proposed in this Bill, to some extent can cut back on economic activity.
The problem of course is that bills have to be paid. The expenses of Government go on. The deficit of the Government is massive. It is to that issue that I intend to address the House this morning.
This Bill really is a three-part Bill. It increases the general sales tax from 10 per cent to 11 per cent and the tax on building materials and products of that nature from 6 per cent to 7 per cent, commencing at the beginning of the new year. It increases the tax on alcohol to 14 per cent. It imposes some new taxes and broadens the base of our tax system to include a number of products that were not heretofore taxed. To that extent the broadening of the tax base is to increase the revenue to the Government in the period commencing on January 1, 1986, for that year, by $510 million.
The tax also deals with the excise tax on motor fuels. You will recall that the effect of the Budget was to remove the Canadian ownership special charge. That was the tax that was designed and imposed on all consumers of all petroleum products in order to pay for Petro-Canada's purchase of Petrofina. That tax was 1.3 cents a litre and it covered home heating oil, natural gas and all forms of fuel, not just motor fuel. The effect of the change in the excise tax is really not to change the gross revenue of the Government at all because what the Budget has done is to remove the Canadian ownership special charge that applied right across the board and replace it with a tax deliberately and specifically focused on motor fuels. So while we removed a 1.3 cent a litre tax, which included home heating oil, we now have a tax of 2 cents a litre, but that is strictly on motor fuels.
It has been the view of the Government, indeed the view of this Party, that the cost of heat in a man's home should not be taxed. This is a pretty cold country and it is a pretty callous Government which would tax the cost of heat on homes. So we took the tax off that item, but we added tax to the cost of motor fuel because the Government needs the revenue. It would be a sensible Parliament that would applaud that effort.
The total effect of the taxes is to increase the burden on the economy by roughly $1.6 billion in the next fiscal year, and that revenue is absolutely essential if we are going to come to grips with the problem that this Parliament faces, indeed that the country faces, in returning our economy to a certain stability.

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Recently the figures for the period ending on July 31, the first four months of this fiscal year, were released by the Minister of Finance (Mr. Wilson). Those figures were disastrous. I remind you that the deficit at the end of July of last year was $11.3 billion. The deficit for the end of July of this year is $11.5 billion. In other words, despite what we have done, the deficit has crept up by $200 million.
Our expenditures are up. Our revenues are up. However, so is the deficit. For every $100 the Government spends, it is only able to collect in taxes $63. That means that it has to find $37 either by borrowing it or by taking it out of other funds such as pension accounts and the like. In other words, we have to beg, borrow or steal $37 for every $100 spent.
When Members of Parliament and Ministers ask for spending increases, for new programs and for better programs, they must remember that only 63 cents of every $1 comes from the taxpayer and that 37 per cent of that is a burden on our children and our children's children. It goes on and on sapping away at the life-blood of our economy and the future of our nation.
Dramatic efforts have been made by the Government this year to cut back on expenditures. In the figures ending in July, many Departments have shown that they are spending considerably less than they had spent in previous years. Expenditures in the Department of Agriculture, for example, are down $8 million or $9 million despite the fact that there has been a drought, despite the fact that there have been problems in the agricultural community and despite the fact that we still have an inflation rate of 4 per cent. The same can be said of one Department after another. Indeed, the only Departments of Government that show any increase are those Departments which make specific transfers like transfers on pensions, transfers on EPF and transfers to the provinces. These are transfers that have to be made because they have defined programs of payments. Of course, the costs of two other items have risen. The cost of national defence has gone up as we try to do those things that were left undone through so many years of mismanagement. As well, the thing that has really risen is interest. The cost of carrying the national debt in this four-month period was $8,275,000,000. Last year we spent $6,954,000,000 in four months to carry the national debt. The cost of carrying the debt went up by $1.3 billion.
I have already mentioned that this Bill will raise $1.6 billion. However, the interest cost alone charged to the Government in a four-month period would take care of nearly all the revenue this Bill will raise. Opposition Members must tell us where we will get the money to pay the bills if we do not get it from the taxpayers.
Departmental Estimates have been cut way back. For example, the Estimates of the Department of Transport have been cut back by $250 million in this four-month period alone. Where do we get the money we need if we do not take it in taxes? How do we come to grips with an over-burdening debt if we do not raise taxes? It is totally unrealistic for opposition
Members to oppose this Bill in any way because this Bill is an attempt to come to grips with the inherent problems with which the Government was left after so many years of profligate management.
As I said, the taxes we receive account for only 63 cents out of every $1 spent, and the other 37 cents have to be taken from the economy by borrowing. This borrowing burden presses up interest rates, cuts back on other expenditures that could be made and is the problem which seriously impairs our ability to come to grips with reducing the deficit and eventually getting the country on a sound footing.
It should be pointed out in this debate that the Government has been eminently successful over the past year in reducing interest rates. Interest rates are now lower than they have been for some seven and a half years. The interest factor is such that we were able on Thursday of last week to put 90-day T-bills at an interest rate of 8.51 per cent. We hope to be successful in borrowing on Canada Savings Bonds this year at 8.5 per cent. By the way, that is a pretty good rate of return for those who invest in Canada Savings Bonds because I do not know where else one would be able to get a bond or certificate cashable at any time that would yield 8.5 per cent.
Interest rates are being pressed down and they are being pressed down because we are coming to grips with the problems of the country and because we appear to the community to be responsible. Interest rates are being pressed down because the community realizes that we all have to face the music and pay the additional levy that we must impose upon ourselves in order to come to grips with our debt problems.
If we refuse to pass this Bill, if we refuse to pay attention to the cost of carryign the debt and if we refuse to pay some attention to the realities of our budgetary process, our interest rates will go up to the moon because no one will trust our currency any more than the currencies of Mexico, Argentina and Brazil are trusted. If we were to carry on the policies advocated by members of the Liberal and New Democratic Parties, that is exactly what would happen to our economy. We were in serious danger of having that happen to the economy throughout the years the former Government was in power. Interest rates have dropped at least 3 per cent since the previous Government was defeated.
Most importantly, Sir, I would like to speak today about how we may come to grips with these problems. Members of Parliament are elected to do things for their constituents who expect them to represent their interests in the House of Commons and before Ministers of the Crown. If there are programs that could be made available to assist Members' constituents, the Members want to make sure that those programs are put in place. However, Members of Parliament have an overriding responsibility and that is the responsibility of being legislators for the entire of Canada and of guiding the future of Canada not only for the short-term benefit of their constituents but for the long-term benefit of all of Canada.
I spoke of the need for some parliamentary review of the ways and means by which taxes are raised and expended. At the present time, the Government produces a "blue book"
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which contains a breakdown of the Government's estimate of spending for each Department. There is no parliamentary input on the Estimates before they are prepared. The only thing we can do is to object to an Estimate. Members will recall that on the last Supply day in the spring term there was a series of votes whereby a Member objected to an Estimate, put it before the House, and the Government moved to have the Estimate reinstated. I do not know of a method less effective than that by which Parliament is supposed to come to grips with government expenditures.
Under the present system the Government is totally responsible for the budgetary and tax measures. Until now it has refused to let Parliament really become involved in how taxes are raised and how expenditures are given priority. If you have so many dollars you can spend on the environment, where do you spent it? Do you spend it on a park, on protecting wildlife, or on cleaning up improper waste disposal? Where do those priorities fit in with pension, transportation or job training expenditures? It should be Parliament that decides on those priorities, but our present system does not permit Parliament to do so. Presumably the priorities are determined somewhere in the Treasury Board or Cabinet. Perhaps they are not determined at all. Perhaps Budgets are determined on the basis of what was spent the year before and you add 4 per cent.
Clearly, Mr. Speaker, we must have a better system in order to come to grips with our expenditure program. Clearly we need a method whereby parliamentarians, in committee, can go over Government priorities and determine among themselves, from a zero base, how much ought to be awarded to one envelope or another. Until we are prepared to do that, the system will be without a budgetary control mechanism because at no time under our present system do Members of Parliament ever get together and go over the whole Budget and determine priorities on the basis of available funds.
Sir, I have made these suggestions before the committee which is studying new procedures for the House. I say to you that unless we are prepared to take this kind of action, we will be faced with one little Bill after another coming before us. This particular Bill taxes various economic activities at varying rates, 14 per cent, 7 per cent, 11 per cent. However, there is no relationship between how this Bill raises money and how the money is spent, whether it be on retraining programs or defence programs or anything else. It is a Bill to raise money, but there is no relationship between it and the needs and demands of our constituents and their children. Therefore, we need a committee of this House which will look at the total revenue raising potential in co-ordination with the necessary expenditures. Then we will have a handle on where we are going, because at present we have no such handle. Unless we as parliamentarians do this and do it fairly quickly, we are going to continue to receive great, big, thick blue books with all sorts of Estimate breakdowns which do not help us and do not give us any idea of expenditure priorities. They are all presented as equally important and therefore we will vote for
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them. The tax measures which come in will be equally important, as will the borrowing requirements, but there will be no co-ordination between tax and expenditure. That is why I say it is important that this Parliament comes to grips with our problem generally.


Mr. John Parry (Kenora-Rainy River):: Mr. Speaker, it is a pleasure for me to rise and join in the debate on Bill C-80. Previous speakers have emphasized at considerable length that this Bill represents a large part of the income side of the Budget and that its primary purpose is without a doubt to raise money. At the outset I want to say everything good which can be said about this Bill, and I know Government Members will endorse that. I will then spend the other 19 and a half minutes pointing out what is wrong with Bill C-80.
It is my belief that the introduction of the search and seizure provisions, similar to those proposed for the Income Tax Act and which have been instituted in the system, is indeed a step long overdue. The idea that taxpayers may at least have some possibility of being considered innocent until found guilty is worthy of incorporation in the income tax system, and I am glad to see those principles extended to the Excise Tax Act through Bill C-80. It seems to me that the institution of provisions which will allow the taxpayer to exhaust his, her or their appeal remedies before the tax becomes due and payable is inherently fair and much more in accord with principles of natural justice than the previous regime of pay up now and we will settle whether you owe us anything later.
As has been said, the rate of the federal sales tax is increasing by 1 per cent. For the record, that will mean that from now on a 7 per cent tax will be payable on construction materials. I do not intend to enumerate all the items subject to increased taxes but I want to look at the larger items. One of the measures in this Bill which I see as most pernicious, the one most worthy of opposition from this side and, indeed, from that side of the House, if there are any Members who care to do so, is the introduction of the federal sales tax on a wide range of what we might call near-food items. Specifically, the sales tax exemption for candy and confectionery has been repealed, along with those for soft drinks, pet foods and certain health goods. I would like to concentrate on those two categories and see what sort of effect this has on Canadian consumption patterns and, by extension, on Canadian society.
It bothers me to see a measure coming in which taxes these near-food items, because there is only a very fine line remaining between those near-food items and items which are genuinely and legitimately part of people's every-day diets. In fact, I would go so far as to say that many items covered in the exemptions that are being repealed are legitimate parts of the every-day diets of Canadians today. We all know of people whose workstyles and lifestyles are run at such a pace and in such a manner that they do depend on snacking between meals to supplement their nutritional intake. I would say that in spite of the many legitimate things that have been said about the near-food items such as candy and confectionary, there are

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many such items which are legitimately nutritious, which have reasonable nutritional content for the price demanded, and which can legitimately be included in a proper nutritional diet.
I wonder if a spokesman for the Government would tell us at which point cereals become confectionary. Over the past few years we have seen the rising popularity of granola which has translated into products known as granola bars which are highly nutritious and of which I, in my travels, consume a fair number. One must wonder whether there is a line and whether the Government is planning to make a wider range of food products subject to the federal sales tax. I hear one of the Members opposite who represents a farming constituency making a comment. I would point out to him that when the consumption patterns of foods are changed, it is not necessarily Canadian farmers who benefit.
Similarly, with regard to what are to be classed as soft drinks, there is a very fine line to be drawn. There are products on the market today which are compounded of real juices, artificial flavourings and carbonated water. In passing a measure such as this, we have to ask whether this represents the thin edge of a wedge for the Government. Is it a measure which is being tried out to see what the public reaction will be? Is it some sort of kite flying to see whether a wider range of products could not be subjected to the federal sales tax in the future?
The subject of pet foods has not been adequately addressed in the debate to this point in time. It is unfortunate that there are some Canadians who consume pet food as part of their own diet. I do not point that out in an attempt to exploit it for its emotional value, but merely to state it as a fact. With regard to the question of health goods, let us look at the likely effect of the institution of the federal sales tax on medical substances and devices that were not previously subject to the federal sales tax. My impression, Mr. Speaker, is that in at least a marginal way, if not a wider way, it is going to impact on the operations of our health care system. Will it not lead to people paying more visits to the doctor, which visits are not entirely necessary, because the prices of the remedies which they have come to know, use, and trust in the past are now rising in price by 10, 15, or 20 per cent, depending on what happens between the manufacturer and the retailer? They may find, particularly with drug insurance that is available to many Canadians, although unfortunately not to all, that they can get these items virtually free by visiting the doctor rather than getting them on their own.
I would like to discuss the effect that the increase in taxes on fuels will have on the more remote northern parts of Canada which depend on transportation systems for all the major inputs of life. They depend on transportation systems for personal movement and for the transportation into the community of most of the goods consumed there. This situation can only be described as one of double taxation. For example, an airline operator in a community such as Big Trout Lake in my riding has to fly in large amounts of gasoline, preferably during the winter, in order to run his operation throughout the year. Therefore, the impact of the tax is in
essence ratcheted. It is subject to a gearing factor, and the consumer is going to see far more than the pro-rated effect by the time it reaches the price of an airline ticket or the price of freight rate for bulk commodities. This is, of course, because tax is being paid on the gasoline used to transport the taxable gasoline for future use.
That is hitting at a community which is one of the lower consumers of the support services provided by the federal Department of Transport. I know that the Hon. Minister of State for Transport (Mrs. Blais-Grenier) will be very pleased to confirm that for any Member of the House who may ask her. In fact, there are parts of this country where there are no federally maintained airports, runways, or control towers. While these areas can get weather forecasts, they are made for a larger area and cannot be relied upon too much for the smaller areas and shorter trips that these planes are making. There are planes, after all, Mr. Speaker, that serve their entire lives without ever touching a federally assisted runway because they are always operated on floats and skis. While it is not easy, obviously, to relate the actual cost of the services that those operations do consume, I think that the Government would be willing to acknowledge that, on a per airplane basis, the consumption of those services and, therefore, the impact on the budget of the federal Department of Transport is lower than that of those aircraft that are using airports and of those airlines that are using the wide range of services which provide such a safe and efficient transportation system throughout southern Canada.
The impact on prices in communities where all commodities must be brought in by air is not going to be of the same percentage order as the actual increase in taxation because it, too, will be ratcheted by the effect of using that tax paid fuel to get the product to the distribution centre, from the distribution centre to the jump-off airport where it will be flown north, to fly it north and finally to distribute it throughout smaller communities.
I would like to turn now to the so-called sin taxes, Mr. Speaker. I think that we should acknowledge that although we may not ourselves sin in all the ways that are taxed, there are very few of us who sin in none of the ways that are taxed. The Government, which in its Throne Speech offered something for everyone, is now getting something from everyone. I would like to look particularly at the effect of excise taxes on alcohol in Canada's tourist industry. It is my belief that many factors are being ignored in the imposition of that additional tax. It is not simply a question of what the final effect would be on the price of a drink in a given bar. Rather, it is a question of the way in which the market perceives it, the way in which people who are coming to Canada look at what is happening. There are, after all, price points in every form of service. Let us, for a moment, imagine the situation of someone saying to his neighbour in the United States that he went to Canada and it cost him $3.65 for a martini. Let us also remember that generally speaking, the effect of the very large exchange premium tends to go completely by the listener on first examination. They think of where they were when they last saw a martini
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advertised at that price. It is probably one of the most expensive places that they ever visited. They equate the range of prices for all of those other tourist products, including hospitality, meals, transportation and excursions by gearing them to the price of alcohol. There is a spill-over effect, if you like, and a negative perception permeates the way in which other tourism products are perceived. This is undoubtedly a contributory factor to the declining share that Canada commands in world tourism receipts.
I think the kindest and perhaps most sensible comment I could make on the increase of 25 cents for a package of 25 cigarettes is that it is an adequate increase. Of course, I was warned by my colleagues, as a known avid anti-smoker, that taxation is not necessarily the best way of stamping out that very expensive and dangerous habit. I will restrain myself by saying that I am glad to see that there was at least some raise imposed in that particular area.
Finally, let me set the excise tax increases within the context of Canada's over-all taxation system. It is in the over-all context that one should judge how Canadians would perceive these tax increases. The point has already been made many times but does not seem to have been fully absorbed by the Government that sales taxes are a regressive form of taxation. These taxes take a larger proportion of the income of low-income consumers. I am reminded of complaints against monopolies in Great Britain during the reign of King James I of England-the sixth of Scotland. It is somewhat similar about the complaint that was voiced about monopolies: "They sleep in our beds, they sup in our cups". Indeed, that is the effect of these sales taxes and it has a far greater relative impact on the poorer person than on those who are more comfortable or wealthy.
Let us look at the excise and sales tax increases within the framework of the rapidly declining contribution to Canada's tax revenues that is made by the corporate income tax. Let us look at the progress-I use that word with my tongue well in my cheek because it is indeed a regress-in the percentage of taxation collected from the corporate income tax over the last few years. In the 1950s, the corporations were paying approximately half of the income tax in Canada. In 1960, they brought it down to 42 per cent; down to 36 per cent in 1970 and by 1980, down to 30 per cent. Indications are that the corporate share of income tax in Canada will fall to the 20 per cent range, given the incentives, breaks, loopholes and boondoggles, frankly, that have become available to corporations in Canada.
The 1984 annual review of the Economic Council of Canada pointed out that the forgone tax revenue on corporate tax and expenditures was approximately S30 billion to $50 billion a year. This is at a time when taxes on individuals are predicted to go up by over a billion dollars in 1986, a year in which it is expected that the corporate tax share will drop by $500 million.
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During this debate we have heard much from the Government side about the Government's record on interest rates and job creation. While 1 will not condemn the Government record outright, I merely want to suggest that the reason there are so many speeches being made in the House praising the Government on job creation and interest rates is that there are so very few economic journalists and economists in the country who really believe that the definite improvements that have taken place are a result of the Government's action in this field.
I want to commend the Hon. Member for Mississauga South (Mr. Blenkarn). While I depart from him on most points of ideology, he is known and respected as one of the best technicians in terms of the budgetary process. Using the time he took to explain potential improvements was very worthwhile for the record in this debate. Over-all, however, C-80 is a game of winners and losers. We know who are the winners, and we know that the losers are the ordinary people of this country.


Donald Alex Blenkarn: Mr. Speaker, the Hon. Member will know that the tax on alcohol spirits was to have risen by 4 per cent on September 1 in accordance with the cost-of-living arrangements and the current taxing system that is in effect. He will also know that this was abandoned and replaced by a 2 per cent increase.
I must agree with him that the price of alcoholic beverages in Canada is a serious detriment to our tourist industry but he should point out to the House that the Government recognized this to some extent and allowed that tax to rise only by half of what was proposed. I think it is important for people to understand that.


John Edmund Parry: Mr. Speaker, I certainly have no problem acknowledging that fact. I thank the Hon. Member for putting that on the record because I believe it is worth-while.
In the over-all context of taxation policy, it is a good principle to untie the major commodity taxes from a simple inflation adjustment because I believe that tax rates on such prime taxable items as alcohol, tobacco and gasoline should be reviewed every year as a matter of taxation policy and part of the budgeting process. I am sure that the Hon. Member for Mississauga South would endorse that point of view.
The Hon. Member is correct that the rate increase is half of what would otherwise have taken effect. I believe that the gasoline tax increases should have been handled as sensitively because that is also a substantial component in the mix of tourism expenditures in Canada. This is of particular concern to tourist operators in my riding because of the unusually long distances people must travel to get to their area. Since a large proportion of the route travelled to get to their area is in Canada, they have considerable concern about the impact of those gasoline tax increases on the tourism industry in Canada generally.


Donald Alex Blenkarn: I appreciate the Hon. Member's understanding of the Government's policy with respect to the liquor tax.

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Excise Tax Act
With respect to gasoline, the revenue between what would be received from the 1.3 per cent a litre Petrofina tax is approximately the same as the revenue from the 2 cent a litre tax on motor fuels.
While I am also very concerned that our gasoline prices are considerably higher than those in the United States as a result of this tax on motor fuels, I would rather have the tax on motor fuels than on home-heating oil. I am sure the Hon. Member will appreciate that, coming as he does from a constituency where many people are required to use homeheating oil to heat their homes. The amount of revenue collected from this tax is the same as what would have been collected with the Canadian ownership special charge. While it obviously increases the cost for those who drive vehicles, it reduces the cost for those who use home-heating oil. Perhaps he will agree that the effect is awash in the economy, even though the total burden of tax is regressive.


John Edmund Parry: Mr. Speaker, I thank the Hon. Member for that comment. I think the elimination of the tax on home heating fuel is a sound measure. But it is worth saying that, by and large, the home heating oil tax has affected people at the lower end of the income scale even more than does taxation on gasoline.
I would like to thank the Hon. Member for his understanding of the way in which the tax on gasoline used for motor vehicles impacts on people who live in the more remote areas. Gasoline which they purchase has already been subjected to "up charges" because of the transportation distance for the refinery. The distances people must drive in remote areas tend to be greater than the distances people in major centres have to drive for whatever cause or reason. I see more higher mileage vehicles throughout my riding than I do around the City of Ottawa.
We ought to bear in mind, and it is worth having on the record, that that tax is one that tends to fall disproportionately on people who live in remote areas.


Mr. Morrissey Johnson (Bonavista-Trinity-Conception):: Mr. Speaker, I rise to support Bill C-80, not because I think it is a fantastic piece of legislation but because I think it is necessary and that it is a fair Bill which will help to bring our staggering deficit under control.
The Bill before us to amend the Excise Tax Act and the Excise Act will raise badly needed revenues from the commodity tax system, badly needed revenues which will assist the Government in achieving its goals of economic renewal and sustained economic growth.
While it would surely be easier, Mr. Speaker, for the Government to avoid such difficult measures as tax increases, uncontrolled increases in the deficit and debt would not only hamper economic growth but would jeopardize Government programs and services which people require.
Hon. Members from the opposition Parties who have spoken on Bill C-80 so far oppose the responsible action the Government is taking in this Bill, despite the fact that the interest on the deficit is fully one-third of total spending and that debt charges threaten social programs targeted at the needy.
Controlling the deficit is a condition of assisting the needy. This is a fact which should motivate all Hon. Members in this Chamber to give their full support to this Bill and to ensure its speedy passage through the House.
As the Minister of State for Finance (Mrs. McDougall) and my other colleagues outlined in debate last week. Bill C-80 concentrates on controlling the national debt through a number of revenue raising measures. Substantial new revenues will be raised by broadening the base of federal taxes and increasing rates of tax.
None of us like tax increases, Mr. Speaker. However, putting people back to work is going to require sacrifices and hard work by all of us. I believe Canadians are willing to give a little to help those who are less fortunate. It is important to consider this Bill in a broader context in relation to other measures which the Government has also taken. The Government has balanced these increases in taxes with a reduction in its expenditures. Measures have been introduced to increase private initiative and investment in the country's economy. Civility has been restored to federal-provincial relations. The Western Accord is presently contributing to economic renewal in that part of the country after its economy had been devasted by the former Government's national energy policy.
In my own Province of Newfoundland, after a decade of long battle with the former Government over control of our province's offshore resources, the Government has fulfilled its election promise and brought an early agreement after just five months in office.
The Atlantic Accord is a shining example of what can be achieved when a spirit of co-operation and fairness exists between two Governments. Just as the Atlantic Accord will help to achieve economic prosperity for Newfoundlanders, the measures in Bill C-80 will assist in creating economic growth throughout the country.
Some Hon. Members have stated that this Bill will have a dampening effect on the economy. It is well known that since 1984, 305,000 new jobs have been created and that today's rate of unemployment is the lowest it has been in three years. It is not low enough by any means, but our Government will continue its successful efforts in order to keep this decline continuing in the jobless rate. As well, interests have fallen since the Government was elected a year ago and are at the lowest level in seven years.
A recent Statistics Canada survey found that business investment intentions for 1985 are up 12 per cent over last year's level. This increased capital spending will create jobs, of that there is no doubt. Inflation remains steady. At 4 per cent it is at its lowest rate since October 1971.
After only a little over a year in office, the policies of the Government have brought about these positive results. I am amazed that opposition Members, which saw the deficit go from $17 billion to $200 billion while the former Government
October 28, 1985

was in office, can stand in this House and criticize the responsible actions of Bill C-80.
The economic indicators which I have cited show we are on the right course, Mr. Speaker. The difficult measures contained in Bill C-80 clearly reflect the Government's commitment to the people to achieve economic renewal and jobs.
I believe that the Government is on the right course. The difficult measures contained in Bill C-80 clearly reflect the Government's commitment to the people of the country, to achieve economic renewal and to create new jobs.


Some Hon. Members:: Hear, hear!


Mr. Cassidy:: Mr. Speaker, I appreciate the comments of the Hon. Member for Bonavista-Trinity-Conception (Mr. Johnson). He has spoken favourably and said that it was good to contribute by this means, that his constituents should pay more for liquor, gasoline and all types of goods and services which in fact will suffer an increase in sales tax under Bill C-80. He is saying that that kind of sacrifice is something which is worth while. Of course, the question which comes to my mind is: To what extent will his constituents benefit, or for that matter the people of Newfoundland?
I suggest that the people of Newfoundland will not benefit, if benefits arise, in nearly the way the people in central Canada will benefit. Quite simply, the private sector in an area like Bonavista-Trinity-Conception is not particularly strong. There are very few high-rollers in that part of the country who stand to make $500,000 in capital gains which will be sheltered from tax, according to the measures put forward by the Government. At the same time, there are large numbers of unemployed workers or people in the fishing industry who are now being driven to the wall by the decision of the Conservative Government to allow the Department of National Revenue to go after fishermen for back taxes to the point where they will be driven out of business, if they are still in business at all. They are suffering from the worst catch in many years in that particular part of the country.
I ask myself the following question: If a Government wanted to make all people suffer to some extent by means of increases in regressive taxes in order to turn around and create jobs in disadvantaged parts of the country, that might be at least a defensible strategy. However, is it really defensible to take money from regions with high unemployment or little economic opportunity in order to put it into the pockets of people who benefit from capital gains on investments in apartments in Manhattan, in works of art, or in condominiums in Florida or Palm Springs, Arizona?
Perhaps the Hon. Member would be able to enlighten the House as to how many of his constituents will in fact be in positions to benefit from the capital gains exemption on such matters as foreign real estate investments, and what he thinks that will do in terms of job creation in his region about which I know he is terribly concerned. Perhaps he could enlighten us in terms of the provision of jobs for young people, married
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women and workers in general in Bonavista-Trinity-Conception.


Morrissey Johnson: Mr. Speaker, I thank the Hon. Member for his comments and for his question. I am sure he is well aware that I said at the outset of my remarks that it was not a Bill about which to be jubilant, but that I thought it was a necessary and fair act.
While the people in my riding may not benefit from all measures contained in the Bill, with the vastness of the country from Newfoundland to British Columbia, we would be sitting in the House year round, day after day, for many years to come, if we had wanted to introduce legislation which would perfectly meet the requirements and the needs of all people in the country. I am well aware of the hardships in Bonavista-Trinity-Conception. Some of the taxes collected from the more prosperous areas of Canada will help to pay the $9.5 million which the Hon. Minister of Employment and Immigration (Miss MacDonald) had announced today in Newfoundland to help fishermen and plant workers who were not fortunate enough this summer, through their endeavours in trying to earn a decent living, to have acquired enough fish or work to qualify for unemployment insurance. A lot of people look upon unemployment insurance as a supplement to their income in the part of the country from which I come. It is not because they are proud to tell people that they are receiving unemployment insurance benefits. It is because they do not live in a manufacturing area and they can only find seasonal work. They have to depend upon the prosperity of other parts of Canada. That is what Confederation is all about; it is the sharing of the wealth of one part of the country with the poor in other parts of the country.


Michael Morris Cassidy: Mr. Speaker, again I appreciate the Hon. Member's comments, but I should like to suggest to him that perhaps the long-established practice of the sharing of wealth among different regions of the country has been reversed, now that the new Government is in power. Traditionally, those areas which were the most prosperous, including southern Ontario and Alberta, for a time, in fact contributed to regions of Canada, including Newfoundland, which were less prosperous. Surely the Hon. Member must know that a sales tax increase is a regressive tax. It hits people in low-income brackets harder than it hits people in upper-income brackets.
The Hon. Member stated that the people in his riding may not all benefit from these particular measures. It seems to me that the redistribution of wealth which will take place with Bill C-80 is that money will be taken from the people of Bonavista-Trinity-Conception. They are the ones who are being hit in order to provide financing for the high-rollers in Toronto, Montreal, perhaps Ottawa and other parts of the country, who will benefit from the $500,000 exemption on capital gains tax. I am told those high-rollers all drive BMWs, but I have as yet to hear about a BMW being made in Canada by automobile workers even in southern Ontario. They are made in West Germany.

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Does the Hon. Member really feel that he can go back to his constituents? The Government has announced a program to allow some completion of unemployment insurance entitlement for his constituents, and that is welcome, but it has yet to pull back on saying to the same fishermen, who could not even reach the point where they could receive unemployment insurance, that they will have to pay more than 25 per cent of their income this past year toward paying off tax liabilities from previous years with National Revenue. If the Government were really concerned, it would be doing something about that as well, but it is not taking place. What kind of Government does the Hon. Member find himself a part of which in fact robs the poor in order to benefit the rich? It is a kind of reverse Robin Hood tactic, and the Newfoundlanders whom I know do not stand for that kind of reverse tactic.


Morrissey Johnson: Mr. Speaker, I am glad the Hon. Member decided to sit down and make a little time available to me in which to respond to him. The grass is always greener on the other side of the fence. I am sure his colleagues in Ontario thought that when they formed a coalition with the provincial Liberal Government. In order to provide the services which people want, they found it necessary to increase taxes. I am sure the Premier of Ontario was not happy to have his Finance Minister do that.
When I made reference to the Atlantic Accord, I did not say that the Government of Canada was putting in $225 million for the training of people to work on oil rigs and in the developmental stages of Hibernia. That is a substantial amount of money. People are grateful that a Government in which they believe could come to an agreement with a provincial Government in just five months in office. I am proud to be part of that Government, even though there will be times when I have to take part in decision-making that I do not fully agree with but, as I have already said, that will be necessary if we are to continue to govern and give the needy of the country the things they deserve and to which they are entitled.


Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, the debate today takes place in rather unusual circumstances, provoked by the publication of public opinion polls this morning whereby it would appear that there has been a sudden drop in Progressive Conservative support across the country. It is a sudden drop that reflects the political reality where the federal Conservatives seem to be holding only a six point lead over the Liberals and trailing the Liberal Party in every region except in the West. According to this poll also, the Conservative losses have occurred in every region and demographic group and they are the greatest in Ontario, especially in Toronto.


Mr. Lanthier:: Mr. Speaker, on point of order.


Mr. Deputy Speaker:: The Hon. Member for LaSalle, on a point of order.


Claude Lanthier: Mr. Speaker, I was waiting to see whether I could find some relevance to the debate. You asked the House a while ago to resume debate on Bill C-80. I have the Bill here, and although I have looked everywhere, I fail to see any connection with the points the Hon. Member is trying to make.


Mr. Deputy Speaker:: The Hon. Member for Davenport (Mr. Caccia) has the floor and is an experienced parliamentarian, and of course he will speak to the Bill.


Mr. Caccia:: Mr. Speaker, if the Hon. Member for LaSalle (Mr. Lanthier) would give me a few minutes, I would be delighted to demonstrate the relevance of this poll to Bill C-80. [English]
In continuing with this background to this debate it would appear that middle-aged Canadians, professionals, executives and union members have also deserted the Tory Party in large numbers. In Ontario the federal Liberals have moved ahead for the first time since June, 1984.


Mrs. Mailly:: The Bill isn't passed yet. This is not relevant.


Charles L. Caccia: Exactly. That is an interesting point. I will take it into account in a short moment. In Quebec the Conservatives are slightly-


Donald Alex Blenkarn: That is what happened to you. You believed the polls last June.


Charles L. Caccia: -trailing the Liberals.


Mr. Deputy Speaker:: That is no doubt interesting but could the Member please get to the Bill shortly. I understand that he wants to make a preamble, which is fine, but I would ask him to come to the Bill, please.


Charles L. Caccia: Yes, Mr. Speaker. I will certainly heed your advice. I was getting there by also reviewing Atlantic Canada, but your urging brings me to raise the question: is this because of these budget measures and the Ways and Means measures in Bill C-80? That question, of course, is being answered by those of us in the Official Opposition by opposing the measures contained in Bill C-80 and in having for months and months-


Claudy Mailly: On a point of order, Mr. Speaker.


Mr. Deputy Speaker:: The Hon. Member for Gatineau, on a point of order.


Claudy Mailly: Mr. Speaker ... Yes, well, the Hon. Member for Bourassa (Mr. Rossi) just left the House after addressing some comments to me. He remarked a while ago that I was always the first to complain about people asking questions while I was speaking. I want to point out to him that my
October 28, 1985

complaint against him was not about a Member putting questions to another Member while he is speaking. Actually, what he does is make audible comments when he is not even in his seat, and then leave the House. Mr. Speaker, I wish you would remind him of the ruling you handed down several months ago, when he was acting in a way that was not acceptable in this House.


Mr. Rossi:: On the same point of order, Mr. Speaker.


Mr. Deputy Speaker:: The Hon. Member for Bourassa (Mr. Rossi), on the same point of order.


Carlo Rossi: I would say that it is not up to the Hon. Member but up to the Chair to decide. She complains all the time . . . You see, what she is doing is just talk for the sake of talking, as usual. She does not want anyone to ask questions when she is speaking, and she goes and complains behind the curtains to the Speaker as soon as any one does, Mr. Speaker.


Mr. Deputy Speaker:: I would ask the Hon. Member to listen to what the Hon. Member for Davenport (Mr. Caccia) has to say.


Charles L. Caccia: Thank you, Mr. Speaker. I hope that this latest exchange and the time involved will not be counted against the time allocated to me. The points that I am trying to get across to this evidently nervous group of Tories across the aisle who are, as you can see by their faces, extremely unhappy about the result of the polls, is that if they had listened to our advice and comments since the Budget was announced when we told them that this Budget had a number of weak points and a number of wrong decisions in it, maybe the polls today would not have been so unfavourable as their present result.
There are a number of measures in this Budget that are going to come into effect once the Bill is approved, which we object to. There is, for instance, a 6 per cent tax that became effective on the day of the budget that affects insulation materials, heat pumps, solar heaters, panels and furnaces, wood-burning stoves, wind deflectors, wind generators and windmills and other such energy saving types of equipment and material.
In addition to that, we are debating a measure that involves tax increases on gas of 2 cents per litre as of September of this year, and that will impose 1 cent per litre in January of 1987; a tax that has already been imposed on many categories of construction materials; and a tax on equipment and construction materials using energy conservation; a tax on candy, soft drinks and pet foods; a tax on a wide range of health care products on which we on this side of the House have commented on a number of occasions before, and I would not be surprised if it is also one of the components that has led Canadians to lose their confidence in the Progressive Conservative Party to govern them, as shown in the poll published today. An increase in federal sales taxes across the board from 10 per cent to 11 per cent will become effective on January 1, 1986.
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If we look at 1990-1991, what we see is a picture where consumers will pay some $2.6 billion more as a result of these tax changes while at the same time corporations will enjoy a $2.2 billion decrease in taxes. The capital gains tax break alone will reduce the taxes of wealthy Canadians by some $1.25 billion. I ask, where is the equity in the long term of this kind of taxation measures?
To increase sales taxes is damaging to the purchasing powers of consumers, as we know. The increase in higher fuel costs will affect also the cost of transportation and it will affect also the competitiveness of Canadian truckers vis-a-vis their U.S. competitors. Hundreds of small and medium-sized construction companies will see their profit margins cut to the bone as they are forced to absorb the new 6 per cent tax on construction materials because of the existence of many fixed-price contracts in this sector, which as you know characterize the construction industry, and which are of a nature that cannot be modified just overnight.
We made suggestions, and I thought they were practical, on our side of the House, that this tax on construction companies be phased in to take into consideration fixed-price contracts, but these suggestions have been ignored by the Government. The list goes on and on. What we object to are the details of the measures as well as the direction that is being taken on behalf of Canadians.
I would say in summary that the new taxes discourage energy conservation and they erode the progress made in permetting an increased capacity on the part of the Canadians to exert their purchasing power and, therefore, they erode the purchasing power and lower and middle-income Canadians. In the time available today I would like to speak about a specific measure whereby a specific tax rate will be imposed on unleaded gasoline, a .35 cents per litre tax as compare to .32 cents per litre on regular gasoline. In bringing this to the attention of Hon. Members and the Government, I regretfully conclude that the Minister of Finance (Mr. Wilson) made a serious political mistake, particularly in environmental terms. I will explain this mistake as briefly as I can.
It is well recognized that leaded fuels contribute to environmental degradation, and this occurs in two ways. First, lead emissions pose serious environmental threats in and of themselves, particularly in large urban areas. This has led to legislative reductions in allowable gasoline lead content. The desire to control emissions of substances like CO, HC and NOx has led to tough emissions standards requiring the installation of expensive catalytic converters on new automobiles. These converters are very sensitive to lead in fuels and lead to relatively high rates of misfuelling, which render the converters impotent, thus sabotaging the cause of good, sound, tough environmental standards.
Approximately one-half of the misfuelling that takes place in our country today has been encouraged by the price advan-

October 28, 1985
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tage enjoyed by those who use leaded gasoline. From an environmental point of view, it is undesirable to sell leaded gasoline at prices lower than those charged for comparable unleaded gasoline. On the one hand, this increases the demand for automobiles running on leaded gasoline relative to the demand for automobiles running and unleaded gasoline. On the other hand, it provides an incentive for the misfuelling of automobiles designed to run on unleaded fuel. This price advantage, therefore, leads to increases in lead pollution and acid-rain-causing emissions. It is thus desirable, I submit, to use the federal commodity tax system to eliminate the price advantage.
I propose that the price differential be eliminated through changes to the structure of the federal sales tax on motor fuels.
I will explain this briefly. I apologize in advance for the fact that this will mean putting on record some technical data and figures. Nevertheless, it is necessary.
Let me First explain that as of June 1 of this year, the sales tax on motor fuels has been charged at specific rates according to the following formula: (a) gasoline, regular leaded, a tax of .32 cents per litre; (b) gasoline, regular unleaded, a tax of .35 cents per litre; (c) gasoline, premium leaded or unleaded, a tax of .36 cents per litre; and (d) diesel fuel, a tax of .29 cents per litre. These tax rates will increase by 10 per cent on January 1 of next year. In addition, the excise tax on gasoline and diesel fuel increased by 2 cents per litre as of September, 1985, as we all know.
The sales tax on motor fuels was converted by the recent Budget to a specific tax from an ad valorem tax. The respective rates of taxation thus reflect relative gasoline prices and therefore the tax on regular leaded gasoline is lower than the tax on unleaded or premium gasolines.
On May 29, 1985, a small survey of retail gasoline prices was conducted. I am told that the price of regular unleaded gasoline was found to be consistently higher than the price of regular leaded gasoline by some 2.5 cents per litre. Only a small fraction of retailers sell premium leaded gasoline, and those who do said that they charged the same price as for premium unleaded gasoline.
I would propose that the formula used for setting the federal sales tax on motor fuels be altered and that two new categories, premium leaded gasoline and premium unleaded gasoline, replace the present category of premium leaded or unleaded gasoline. Following the terminology of the notice of Ways and Means motion to amend the Excise Tax Act, the formula for calculating the sales tax on motor fuels should be changed to read as follows;
That the specific rate of sales tax imposed on the following petroleum products be determined as:
(a)	gasoline, regular leaded
(b)	gasoline, regular unleaded
(c)	gasoline, premium leaded
(d)	gasoline, premium unleaded
(e)	diesel fuel
.57 cents per litre; .35 cents per litre; .36 cents per litre; .36 cents per litre; .29 cents per litre;
multiplied by the ad valorem rate of consumption or sales tax expressed as a decimal number and multiplied by one hundred, which applies to goods other
than wines and goods on which a duty of excise is imposed under the Excise Act and goods enumerated in Schedule V of the Act.
This is the technical text, as I understand it, that should be applied in order to achieve the desired goal of reducing the differential in price that exists and which is likely to increase in future between leaded and unleaded gasoline.
What this convoluted piece of language means-and I apologize for it but it is infernally complex-is that as of June 5, 1985, the sales tax on gasoline would be the same as indicated earlier except for regular leaded gasoline which would have a tax of .57 cents per litre; namely, an increase of .25 cents per litre from the .32 cents per litre which the tax is to be according to the formula to which I referred earlier.
As of January 1 of next year, if this proposed amendment to the Ways and Means were to be adopted, we would then have the following tax structure; (a) gasoline, regular leaded, a tax of .63 cents per litre; (b) gasoline, regular unleaded, and note the difference, a tax of .39 cents per litre; (c) gasoline, premium leaded, a tax of .40 cents per litre; (d) gasoline, premium unleaded, a tax of .40 cents per litre; and (e) diesel fuel, a tax of .32 cents per litre. These taxes would then be based upon the current differential between leaded and unleaded gasoline of 2.5 cents per litre. In the meantime, as I learned from The Globe and Mail of Thursday, October 17, in an article by Nicholas Hunter, this spread unfortunately has increased to 3 cents per litre and therefore these figures will have to be slightly adjusted in light of that development.
This very serious situation leads me to say that had the Government thought in environmental terms, it would not have proceeded by recommending a .35 cents per litre tax on unleaded fuels and a .32 cents per litre tax on regular fuels but would have adopted the kind of schedule I proposed a few moments ago.
This adjustment, Mr. Speaker, would of course require from time to time a survey of retail gasoline prices. However, this new formula will not completely eliminate the price differential between leaded and unleaded gasoline. This is for two reasons. In the first place, there is always a time lag in its imposition. Market conditions which generated some differential in one quarter may change so as to generate another differential in the next quarter. Second, the taxes are based on the average differential; regional variations, as we all know, may exist. Having said that, it is quite evident that the spread between the price of leaded and unleaded gasoline tends to be much more stable than the actual price of gasoline which can vary significantly over time and from place to place.
Therefore, even though the sales tax structure I propose will not completely eliminate this price spread, it would eliminate most of the price advantage currently enjoyed by leaded gasoline. I can imagine the thinking on the part of Members representing farmers and fishermen. They will be a bit edgy about this proposal as it affects both the farm and the fishery. To meet that understandable concern, I propose that those two groups be made eligible for a rebate equal to the difference
October 28, 1985

between the sales tax on leaded gasoline and its unleaded counterpart, multiplied by the volume of leaded gasoline purchases. This rebate would be delivered to farmers and fishermen in the same manner as the current 1.5-cent a litre tax refund is delivered. The same eligibility rules would apply and therefore no restrictions would be made between on and off highway use.
It is important that when we approach the taxation of gasoline from now on that we have a political concern for the damage caused by acid rain and that we reflect that concern in our taxation structure. This is a departure from practice because what I have put on record today requires a calculation which so far has not emerged. My conclusion is that by proposing a tax rate for unleaded gasolien which is higher than for regular gasoline we are making a serious environmental mistake. If we want to redress that mistake we should therefore restructure the proposed tax rates. It would be to our long-term benefit if we can find ways through the price structure in the market-place to make unleaded gasoline available to the consumer at the same price as leaded gasoline. In doing so we will reduce lead emissions and the concomitant health dangers, particularly in the heavily built-up areas, as well as reducing the emissions of NOx which find their way into the atmosphere and come back to us in the form of acid rain. It is with this in mind that I would like to conclude and I thank you for your patience.


Mr. Deputy Speaker:: Questions and comments?


Mr. Lewis:: Mr. Speaker, if I did not know the rules of this House I would be tempted to ask the Hon. Member what effect he thinks the massive sales tax increases brought in by the NDP-Liberal Government in Ontario will have on the polls. I would also be tempted to ask him what effect he thinks the vicious behind-the-scenes leadership campaign being waged by the Hon. Member for Saint-Maurice (Mr. Chretien) will have on the Liberal Party. However, I will not do that. What I would like to ask him is this. In view of the fact that he was a Minister of the Environment in the former Liberal Government and has given us a very interesting discourse on what steps we should take with respect to taxing unleaded and leaded gasolien, what steps was he successful in having previous Liberal Cabinet Ministers take specifically on these proposed taxes when he was Minister of the Environment?


Charles L. Caccia: Mr. Speaker, I want to thank the Hon. Member for asking two questions to which he does not want an answer and then focusing on the third one which is as interesting as the other two. This price spread and its widening is something which has emerged only very recently. It is on the path towards becoming wider as time goes by. As I mentioned earlier, it was 2.5-cents in the spring. It is now 3 cents. The application of this specific tax rate as recommended in Bill C-80 is likely to increase this spread in the future because it applies unevenly. On unleaded gasoline the tax will be .35-cents per litre but on regular it is ,32-cents. This is, to the best of my knowledge, a new policy development in the taxation process adopted in this country. Therefore, it is
obviously my duty to bring it to the attention of the Government and to underline the environmental consequences of this particular tax measure, small as it may appear to be in the immensity of the Ways and Means Bill in which it is buried. I am not saying it is buried deliberately, but it is a measure which may go by unnoticed by anyone who is not sensitized to the environmental impact caused by leaded versus unleaded gasoline.
I am sure the Hon. Member comes from an area where the question of acid rain is perceived by people in a particularly strong manner. I am sure he knows that in addition to acid rain the question of lead in gasoline has been one of concern to people who follow its effect on health and connect it with the content of lead in human blood. If that is the case, I imagine that I would have in the Hon. Member a very keen ally in making representations to the Minister of Finance on this issue because he would approach the matter in a way very similar to mine. He would want to ensure that leaded gasoline usage goes down and unleaded goes up.
Finally, in answer to the Hon. Member as to what I did in my term, I would bring to his attention-


Philip Derek Lewis: You have just about enough time to tell me, 30 seconds.


Charles L. Caccia: -the fact that we did set in motion a reduction of lead in gasoline in Canada. The present standard of .77 milligrams per litre is gradually being reduced to .29 milligrams, bringing our standards in line, by 1988 I believe, with the standards in place and enforced in the United States.


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


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.


Mr. Keith Penner (Cochrane-Superior):: Mr. Speaker, I wish to advise the House of my wish to dissolve a partnership, a partnership to which I never gave consent in the first place. The Progressive Conservative Member of Parliament for Tim-mins-Chapleau (Mr. Gervais), not having enough work to do in his own constituency, has announced to a handful of PCs in Kapuskasing that he is now in partnership with me to serve my riding. He told a small gathering of the Party faithful: "It is

October 28, 1985
quicker to gain the ear of Cabinet through a Government Member rather than an opposition MP". The curious aspect of this claim, Mr. Speaker, is that there is hardly a Cabinet Minister who even knows who the Member for Timmins-Chapleau is.


Mr. Boudria:: Who is he anyway?


B. Keith Penner: As far as the House of Commons is concerned, he is somewhat akin to H. G. Wells' The Invisible Man. Where was the Hon. Member for Timmins-Chapleau when the opposition Parties were fighting back attempts to reduce senior citizens' pensions? Where was he when we protested the cuts to family allowances? What has he said here in the House or to his constituents about the billion dollar bank failure fiasco, or rotten tuna on supermarket shelves? He said nothing.
No, Mr. Speaker, such a partner as that I do not want under any circumstances. To the House, to the people of Cochrane-Superior and to the people of Timmins-Chapleau I want to say that this never was partnership will never, never be.



THE HUMANITIES AND SOCIAL SCIENCES


Mr. Ernie Epp (Thunder Bay-Nipigon):: Mr. Speaker, Canadian social scientists and humanities scholars feel discriminated against by the federal Government. They have watched support for the Medical Research Council and the Natural Sciences and Engineering Research Council increase by over one-third in real dollars since 1978-79. The federal Government's support for the Social Sciences and Humanities Research Council, however, has kept pace only with inflation and has not increased at all in real value since 1978-79.
Medical, natural science, and engineering research is undoubtedly important to Canada. Pure research requires federal Government support even while corporations fund a great deal of applied scientific research. Scholars in the social sciences and humanities are primarily dependent on government support for research funding. The limited funding by the Government of such research could lead them to infer that this research is not important to our country, but that is surely not true. If the Government has become largely economic and requires the best possible understanding of how our economy functions, such areas of policy as multiculturalism also require a research basis for their development.
We should all be deeply grateful to the scholars who have clarified ethnic development over the years in our country. Their research points us toward a fuller appreciation of how ethnic interaction created the Canadian society of our day. National development, Mr. Speaker, requires a substantial increase in federal funding of the social sciences and humanities.
[ Translation]



ADMINISTRATION OF JUSTICE


Mr. Fernand Jourdenais (La Prairie):: Mr. Speaker, today 1 want to join all Canadians in deploring the murder of policewoman Jacinthe Fyfe, 25 years old, who had been with the Montreal Urban Community Police Force for nearly five years and, while she was making a routine call, was shot down by an unsavory character.
Mr. Speaker, this time it was a policewoman. Two weeks ago, it was Mr. Frank Shoofey, a well-known Montreal lawyer and one of my constituents, who was killed in cold blood at his office while he was at work. A few months ago, an elderly lady, the mother-in-law of Tex Lecor, a well-known Quebec performer, was strangled and hanged in her apartment, for the sake of a few articles worth $50. And there are many more cases I could name.
Mr. Speaker, it is high time our Government tabled in this House a Bill aimed at reinstating capital punishment in Canada, since 25 or 35 years in prison do not seem to be a sufficient deterrent.
Mr. Speaker, now that every week Canadians are constantly hearing about gratuitous killings and murders, it seems to me that Parliament can hardly remain unmoved.
I understand that Crime Prevention Week will be held from November 3 to 9, a very laudable decision on the part of our Government, but it is not enough. The time has come, and this is what most Canadians and most people in my constituency want, to allow this House to speak out and hold a free vote on the reinstatement of capital punishment.



APARTHEID


Mr. Barry Turner (Ottawa-Carleton):: Mr. Speaker, as someone who spent many years living and working in east and central Africa, and who has been to South Africa three times, I am proud to be finally a part of a Government that is showing strong Commonwealth leadership to dismantle apartheid in South Africa. The Commonwealth countries, with Canada leading the way, have opted to take a series of economic sanctions against South Africa that were announced in the recent Commonwealth Accord. No more Government loans will be extended to South Africa. Trade delegations will no longer be funded, organized, sanctioned or endorsed. There will be a ban on the importation of krugerrands. The freedom of Nelson Mandella is demanded, and more, Mr. Speaker.
In his address to the U.N. last week the Prime Minister (Mr. Mulroney) said: "My Government has said to Canadians that if there are not fundamental changes in South Africa, we
October 28, 1985

are prepared to invoke total sanctions against that country and its repressive regime. If there is no progress in the dismantling of apartheid, our relations with South Africa may have to be servered absolutely". That's leadership, Mr. Speaker-great leadership.


Some Hon. Members:: Hear, hear!



UNEMPLOYMENT INSURANCE


Mr. Dave Dingwall (Cape Breton-East Richmond):: Mr. Speaker, the Minister of Employment and Immigration (Miss MacDonald) has been told once again that changes to rules concerning unemployment insurance eligibility are a step backward in coming to terms with the problems of unemployed workers in their forties and fifties. This time the warnings came not from the opposition benches as they have so often in the past, but from counsel she appointed to advise her. Yet it appears that even their thoughtful consideration of the issue failed to sway the Government from its plan to add to the enormous social and financial problems of older Canadians who find their jobs disappearing, most often because of the Conservatives' economic policy.
The Minister has been persistently warned that changing the rules for unemployment insurance eligibility for workers who received severance pay or company pension payments until their funds are exhausted could present serious problems. I would be remiss, however, if I failed to note that the Minister partially returned to her senses last year when, under heavy pressure from unions and the Members on this side of the House, she decided to delay the revisions. Although the show of compassion was short-lived, those changes affecting severance pay are now in place and The Globe and Mail quotes a ministerial spokesman as saying that there will be no delay to the senseless imposition of hardships on the unemployed who receive company pension payments. To quote the commission's report: "A large number of older workers are faced with economic and social problems which range from severe to desperate. They see their hopes for a safe and secure economic future for which they have worked many years disappearing. They feel that employers, the community, Government and society have abandoned them and they cannot understand why this is happening".


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



CHARTER OF RIGHTS


Ms. Margaret Mitchell (Vancouver East):: Mr. Speaker, Canadians can be proud of the parliamentary committee on equality rights which held hearings across Canada and came to an all-Party consensus on progressive changes that are needed to remove discrimination from our laws and enforce our Charter of Rights. The Equality for All recommendations, which must be implemented, will affect parents, persons over 65 who wish to continue working, homosexuals, immigrants, religious minorities, native people, visible minorities, and the physically and mentally disabled.
Discriminatory practices against Canadian women have been given special consideration in recommendations that also respect the rights of men. The committee recommends shared parental leave, protection in common law relationships, equal treatment of women in the Armed Forces, prorated benefits for part-time workers, and much stronger enforcement of employment equity than is proposed in current Government legislation.
We call on the Government to prepare legislation immediately to implement these recommendations and remove discrimination. Bill C-62 should be redrafted as a first step. Action must replace words to achieve true equality.



THE COMMONWEALTH


Mr. John Gormley (The Battlefords-Meadow Lake):: Mr. Speaker, upon the return to Canada of the Prime Minister (Mr. Mulroney) following the successful meeting of the Commonwealth leaders, we have heard nothing from the Opposition about the success of the Commonwealth Conference. Surely the Liberala and others in the House would have been able to set aside their jaundiced opposition mentality just this once to give credit where credit is due.
The Commonwealth Accord was signed in Nassau by all 49 Commonwealth representatives. This agreement, which calls on South Africa to dismantle apartheid, was largely due to the work of our nation's Prime Minister. The Prime Minister and Mr. Gandhi of India successfully convinced Commonwealth leaders to call on South Africa to end apartheid, end the state of emergency, and initiate real and meaningful dialogue. In addition to these terms, the Commonwealth Accord calls on South Africa to release Nelson Mandella and lift the ban on the African National Congress. Included in the Accord is a serious commitment of measures toward reform. These measures are sensible and compelling. This unanimous accord adds more credence to the Commonwealth and its leadership, among whom our Prime Minister ranks highly.

October 28, 1985




Mr. Bill Tupper (Nepean-Carleton):: Mr. Speaker, the Commonwealth is a vital institution in Canada's external affairs program and the manner in which it interfaces in the solution of world problems. Each Commonwealth Conference has addressed significant world problems. The last Commonwealth Conference was no exception.
Our Prime Minister (Mr. Mulroney) used this forum to announce an immunization program for persons in Third World countries.
The Prime Minister was also instrumental in bringing the Commonwealth leaders to agreement, to finding a middle ground on anti-aparthied sanctions against South Africa. The Commonwealth Accord was signed at the conference in Nassau by all of the 49 Commonwealth countries. It allowed the Commonwealth to remain united, to remain intact and to find a solution to a problem of concern to all.
Prime Minister Diefenbaker returned to Canada triumphant from a Commonwealth Conference some years ago. The Prime Minister returned in a similar manner last Friday. All Canadians are proud of his leadership, his contributions, and his accomplishments.



THE ADMINISTRATION


Don Boudria: Mr. Speaker, the area near the West Door of the House of Commons looked like a used car lot again this morning, with Cabinet Ministers' limousines all over the place. Undoubtedly, the Cabinet was in session discussing the latest public opinion poll.
The poll that was released today shows that there is growing dissatisfaction with the Tory Government and a resurgence of Liberal fortunes. The people of Canada knew that they made a mistake when they elected the Government over a year ago. The jaw that walks like a man is making a mess of things. Even Charlie Star-Kist, the Tuna, will vouch for that.
What a glorious record the Government had in September. The tainted tuna scandal, the failing of two Canadians banks, the gifts to oil companies, the resignation of two Cabinet Ministers, and the awarding of lucrative contracts to Tory friends.
Ministers, Members, and staff from the Prime Minister's Office, and the Tory Party executive are retracting their statements because what the "great one" says is the truth, nothing but the truth, so help us God. Some even claim not to be astute. What does November have in store for us? More resignations, more scandals, more broken promises and more retractions? Who knows.
It is rumoured that the Prime Minister (Mr. Mulroney) will end this Session and start afresh in the spring. I say to him: "Don't wait for spring, Brian. Do it now".



EXTERNAL AID


Mr. Bill Attewell (Don Valley East):: Mr. Speaker, on the eve of the recent Commonwealth Conference the Prime Minister (Mr. Mulroney) announced that Canada will give $25 million for immunization of Third World children during the next five years.
In 1984 CIDA provided assistance to 45 Commonwealth countries. Forty per cent of our bilateral official aid goes to develop Commonwealth countries. The immunization program of $5 million a year can save 700,000 children a year from certain death. Vaccines, equipment, and technical assistance will go to Commonwealth countries such as India and Nigeria, which have recently begun infant immunization programs.
Diseases claim about 2 million infants a year in Commonwealth countries alone.
October 16, 1985, marked the tenth anniversary of the elimination of smallpox. Other diseases will be eliminated through the generous funding of research by countries such as Canada. The $25 million immunization program is another major step by Canada, and all Canadians should be proud to be part of this generous preventive program.



CHILDREN


Mr. Ian Deans (Hamilton Mountain):: Mr. Speaker, sexual abuse of children is a concern of all Canadians and it must now become a concern of all Members of the House of Commons. I do not know whether there are more cases or whether incidents are more disgusting, more sickening, more reprehensible and, therefore, being reported more frequently, or both, but the protection of children is a responsibility of each and every citizen.
The funds must be found now to meet the challenges of this crime. It has been over a year since the Badgley Report was filed with the House of Commons and still there has been little, if any, action taken. The parents, friends, and others who inflict their perverted lust on children must be stopped. The House of Commons must make dealing with this matter an urgent priority.
October 28, 1985



ORAL QUESTION PERIOD


Hon. Herb Gray (Windsor West):: Mr. Speaker, my question is directed to the Prime Minister. During his absence from the country we learned that last March 24, the day after the Prime Minister made his decision to rescue the Canadian Commercial Bank, the Government had information from its own officials that the bail-out package was at least $116 million short of what was required. In other words, the Government knew that that bail-out package was doomed to fail.
Why did the Prime Minister and his Ministers continue to assure the House, the banks, and the depositors that the bail-out would succeed? Why did the Government not take steps at once to amend the bail-out package to take into account this shortfall of at least $116 million?


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, this question has been discussed in the House on a number of occasions. I want to draw a distinction for the Hon. Member that there is a difference between the loan losses that the bank was suffering at the time and the need for a capital injection. Those can be two different amounts.
I believe the Hon. Member is totally wrong when he says that we believed that this support package was doomed to failure right from the start. That is not the case and that is not want I have said. That is not what the Minister of State has said. He knows that that is incorrect, yet he persists in using that misinformation.


Herbert Eser (Herb) Gray: The Minister of Finance is simply contradicting a senior official of his own Department, Mr. Grant, who identified the $116 million shortfall.


PRIME MINISTER'S INFORMATION
Herbert Eser (Herb) Gray: Mr. Speaker, I want to ask another question of the Prime Minister. We learned from the Estey Commission hearings that on March 23 the Prime Minister ordered his Minister of State for Finance to proceed with a bail-out of the Canadian Commercial Bank despite her own opposition to this bail-out. She was the lead Minister whom the Prime Minister himself appointed to look into this matter and make recommendations. Will he tell the House what information he had to justify his overruling the Minister of State for Finance on this important matter?


Michael Holcombe Wilson: Mr. Speaker, the imagination of the Hon. Member is running wild again. We have said on a number of occasions that the Government looked at a number of options and considered all of the pros and cons of each of those options. It was on the basis of that range of information that a decision was made. That was a
Oral Questions
decision taken by the Government. It is a Government decision and all Ministers stand by that decision.


Herbert Eser (Herb) Gray: Obviously the Prime Minister did not have a good reason to overrule his Minister of State for Finance, unless, perhaps, he did not want to rain on his own Economic Summit.


ESTEY COMMISSION-REQUEST FOR APPEARANCE BY PRIME MINISTER
Herbert Eser (Herb) Gray: Mr. Speaker, in view of the Prime Minister's totally unjustifiable lack of willingness to speak to the House of Commons and come clean with the House, will he at least agree to appear before the Estey Commission forthwith to explain and justify his personal role in this bank fiasco?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, contrary to our Liberal friends, when there was a legitimate controversy this Government did not try to cover anything up. We appointed the Estey Commission to investigate all of the circumstances of it.
I think Canadians expect us to put the full light on all of the circumstances surrounding this important matter and to allow someone of the integrity and ability of Mr. Justice Estey to make a value judgment in regard thereto, unfettered by other considerations. That is why he was appointed, and I assume that all Members of the House will want to allow him to continue to do his job.


BAIL-OUT ESTIMATE
Miss Aideen Nicholson (Trinity):: Mr. Speaker, my question is directed to the Right Hon. Prime Minister. It concerns his March 23 decision to rescue the Canadian Commercial Bank. The Government had information that the CCB's bail-out estimate was far short of what was actually required. Why was this information not shared with the Government's partners in the bail-out, the chartered banks, the Province of Alberta and the Province of British Columbia?


Michael Holcombe Wilson: Mr. Speaker, again this is a question that has been answered in the House on a number of occasions last week. The Hon. Member is drawing information based on statements that have been made by people before the Estey Commission. She forgets that the whole purpose of that Commission is to assess these different points of view, draw conclusions from them and present those conclusions in its final report. The Government will wait until that final report is available. At that time we will be able to address the various options open to us on how we deal with this problem.


REVIEW OF BANK'S ASSETS
Aideen Nicholson: Mr. Speaker, investigations on March 19, 20 and 24 showed that the CCB had

October 28, 1985
Oral Questions
seriously underestimated its loan losses. Why then did the Government wait until May, having formally guaranteed the bank's solvency in April and paid over the money, before starting a complete review of the bank's assets?


Michael Holcombe Wilson: Mr. Speaker, the office of the Inspector General of Banks had been in before the rescue package was put together, as well as after.


An Hon. Member:: They told you before it was flawed.


Michael Holcombe Wilson: There were a considerable number of discussions also during that period of time what steps should be taken in connection with the Canadian Com-merical Bank. Unfortunately, the result was not something we were happy to see happen.
The bank did enter into a number of loans that, according to one of the witnesses at the Commission, were bad loans the minute they were written. Those were the things that contributed to the undoing of the bank, and were things beyond the control of the Government. We believe we took the appropriate steps both on the weekend of March 22-23 as well as later on when the bank was put into liquidation.


INFORMATION AVAILABLE TO INSPECTOR GENERAL OF BANKS
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, I have a question for the Prime Minister which I hope he will answer. He has been away from the House on important business with which the whole country agrees.


Some Hon. Members:: Hear, hear!


John Edward Broadbent: But he is now back after two weeks and I hope he will answer the questions.
We now know that the Inspector of Banks made available to Ottawa information on the Sunday, before the decision was announced to bail out the Bank, that the package was going to cost at least SI00 million more than we were told in the House of Commons on the Monday.
Either the Government, when it took its decision on Saturday, did not have this information-in which case it was acting irresponsibly with the taxpayers' money before it looked at its own report-or the Government had the information and the House was misinformed on Monday about the extent of the cost. My question to the Prime Minister is: which is it?


Michael Holcombe Wilson: Mr. Speaker-


Some Hon. Members:: Oh, oh!


Michael Holcombe Wilson: I think I responded to this very question-


John Edward Broadbent: No.


Michael Holcombe Wilson: -from the Hon. Member last week. Again, I repeat to him, he is drawing conclusions
based on testimony that has been put before the Estey Commission. That is the responsibility of the Mr. Justice Estey.
At this point in time we are not going to comment on the range of views that will be put before the Commission-


Mr. Gauthier:: Come on.


Michael Holcombe Wilson: -but await the results of the report and comment at that time, if it is appropriate.


TIMING OF GOVERNMENT DECISION
John Edward Broadbent: Mr. Speaker, before this matter went to the Estey Commission, the Government made it clear it would be prepared to answer for ministerial responsibility in this House.


Some Hon. Members:: Hear, hear!


John Edward Broadbent: That is what the Government should be doing today.

I have a question for the Right Hon. Prime Minister. The Government made the decision on the weekend, before a report by a very important public servant was presented Sunday evening.
My question to the Prime Minister is as follows: Was his decision made before the report, yes or no?


Martin Brian Mulroney: Mr. Speaker, the Hon. Member is confusing certain statements that were made with reports that appeared in the media.
The important matter of the bank situation was submitted to a commission of inquiry chaired by Mr. Justice Estey of the Supreme Court, so that he could judge all the facts objectively and clearly. And that is what we are doing. We set up this commission of inquiry so that it could find out all the facts and make conclusions on the basis of those facts. It would not be my place to comment on the speculative notions or reports of third parties.


PRIME MINISTER'S INFORMATION
John Edward Broadbent: Mr. Speaker, my question is not about speculations or opinions, it concerns the information the Government had or ought to have had before it made its decision on the weekend.
I would like to ask the Prime Minister, as the person who was chairing the important meeting attended by the Minister of Finance and by the Governor of the Bank of Canada, to tell the House when he met on that weekend, specifically on the Saturday, whether he had the information that the cost of the package was going to be $100 million greater than the Minister of State responsible for Finance told the House on the
October 28, 1985

Monday morning. Surely the Prime Minister can answer that question now, and he ought to.


An Hon. Member:: Yes or no.


An Hon. Member:: The whole truth.


Michael Holcombe Wilson: Mr. Speaker, the Hon. Member knows that it is not the practice of this Government, or any other Government, to say these are the various things that were discussed in a confidential meeting.


An Hon. Member:: That is outrageous.


Michael Holcombe Wilson: What is important is the decision that was taken by the Government-


Mr. Frith:: You misled the House on Monday.


Michael Holcombe Wilson: -is well known to the Hon. Member and to other Hon. Members. That decision was based on the range of information we had at the time. It was based on the results of discussions that we had had both with officials as well as the banking community. It was the best decision we could have taken based on the information that was available.


REQUEST THAT MINISTERS APPEAR BEFORE ESTEY COMMISSION
Mr. George Baker (Gander-Twillingate):: Mr. Speaker, this country deserves-


An Hon. Member:: A question.


Some Hon. Members:: Oh, oh!


George Baker: -a thorough explanation of the Government's decision to bail out a bank against the advice of the Minister responsible, the Minister of State for Finance, who says she will not answer any questions concerning the matter while the Commission is having its hearings.
My question, in her absence, is directed to the Minister of Finance. Will he and the Minister of State for Finance appear before the Commission and explain how they can defend, in Parliament, a decision of the Prime Minister with which the Minister of State for Finance did not agree?


Michael Holcombe Wilson: Mr. Speaker, the preamble, as well as the question itself, are totally false. When the Hon. Member has a question that is sound in substance, then we will answer the question.


An Hon. Member:: What are you hiding, Mike?


Mr. Speaker:: Order.


GOVERNMENT DECISION
George Baker: Mr. Speaker, on September 17 in this Chamber the Prime Minister said:
Oral Questions
The Leader of the Opposition makes statements like: "The Prime Minister didn't know the facts".
The Prime Minister knew all of the facts available at the time.
My supplementary question is for the Prime Minister or the Minister of Finance. Is the Minister of Finance saying in the House today that the Prime Minister made a bad decision because he did not have the facts available at that time? Is that what he is saying?


Michael Holcombe Wilson: Mr. Speaker, let me advise the Hon. Member that the information available to us was the information we needed to make the decision. That decision was made by the Government. That decision stands.
I do not quite understand what the Hon. Member is trying to get at with the misleading things he is putting into the preamble to his question.
[DOT]	(1430)


SITUATION OF CANADIAN COMMERCIAL BANK-INFORMATION GIVEN BY BANK INSPECTOR
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I would like to direct my question to the Prime Minister. Everyone knows by now that bank auditors examined the Canadian Commercial Bank loan portfolio on Sunday March 24 and discovered that the amount outstanding was $100 million more than what the Government had thought.
My question is this, Mr. Speaker: Had the bank auditors conveyed that information to the Prime Minister and the Government when the Prime Minister made his decision on Monday, March 25?
[DOT]	(1430)


Michael Holcombe Wilson: Mr. Speaker, I do not know whether there are any rules in the House, but that is exactly the question which was asked a little earlier in this Question Period and was asked on two or three occasions last week. I could give the Hon. Member the same answer, but I do not want to take up the time of the House. The answer which I gave last week and earlier today still stands.


ORIGIN OF INFORMATION RECEIVED BY MINISTER
Lorne Edmund Nystrom: I have a supplementary, Mr. Speaker.
I asked a very direct question. Did the Government, did the Minister of Finance have that information from the Inspector General of Banks when it was decided to give $250 million to the Canadian Commercial Bank?

October 28, 1985
Oral Questions


Michael Holcombe Wilson: Mr. Speaker, I am going to answer this question one more time, and that's it.


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!


Michael Holcombe Wilson: The answer to the question
is-


Mr. Blackburn (Brant):: That is a contempt of Parliament.


John Edward Broadbent: Answer the question.


Michael Holcombe Wilson: If Hon. Members wish to listen to the answer, the answer to the question is that the Hon. Member is drawing conclusions based upon things which were put before the Estey Commission last week. They are the conclusions which he is drawing from it. The whole purpose of the Estey Commission is for Mr. Justice Estey to draw these conclusions, so that he can present a report to the House and to the people of Canada which asserts his judgment of the various points of view that entered into the decisions which were taken surrounding the demise of those two banks.


Lorne Edmund Nystrom: What did you know?


Michael Holcombe Wilson: Until Mr. Justice Estey brings forward his report, I am not going to make any furhter comments.


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!


PRIME MINISTER'S ACCESS TO INFORMATION
Mr. Brian Tobin (Humber-Port au Port-St. Barbe):: Mr. Speaker, it sounds like the Government is about to make its case for shutting down the House, because it does not intend to answer the most important questions before the nation.


Some Hon. Members:: Order.


Brian Vincent Tobin: I welcome the Prime Minister back from the Commonwealth meeting. I hope he has learned a lesson from the British Prime Minister. I hope he is prepared to move a little out of his seat and answer some questions.


Some Hon. Members:: Order.


Brian Vincent Tobin: I want to ask him the question which was asked by the Opposition House Leader that he deliberately chose not to answer. What information did the Prime Minister have which caused him to overrule the Minister he selected and appointed to oversee the entire matter, to overrule her decision and her judgment that this-


Mr. Speaker:: I am in some difficulty. The House knows that our practices have been to allow Members to put the questions they wish to put. However, the House also knows that we have
a tradition of not simply repeating, repeating, and repeating the same question. May I, therefore, ask the Hon. Member to come immediately to a question which perhaps has not been asked and already answered?


Brian Vincent Tobin: Did the Prime Minister have access to any information which was not available to other Members of his Cabinet who were part of the decision to allow the bail-out package to go ahead? Did he have any information which was not available to other Ministers?


Michael Holcombe Wilson: Mr. Speaker, the Hon. Member should realize that this is a government decision. It is a decision taken by the Government at that time. The basis for the decision is not subject to a wide-ranging debate in the House of Commons as to who knew what and who did what during that time.


Herbert Eser (Herb) Gray: Why not?


Michael Holcombe Wilson: Because the-


Carlo Rossi: It looks fishy.


Mr. Andre:: Have you heard of responsible Government and responsible Ministers?


Herbert Eser (Herb) Gray: What are you afraid of?


Michael Holcombe Wilson: If Hon. Members would let me complete my answer, I will give them an answer. This is a collective decision taken by the Government. What individual Ministers felt and what individual Ministers brought forward what information to the decision are subject to Cabinet confidences. The result is a collective decision; the result is a Government decision.


MINISTER'S MARCH STATEMENT
Brian Vincent Tobin: Mr. Speaker, that is an admission that there were differences among the Cabinet.


Some Hon. Members:: Oh, oh!


Brian Vincent Tobin: I have a supplementary question. Can the Minister of Finance tell us why, on March 29, the Minister of State for Finance told the House that $255 million was sufficient, when we know that she knew on the twenty-fourth that the package was flawed by $116 million? How could she make that statement and mislead the House?


Michael Holcombe Wilson: Mr. Speaker, I think that what the Hon. Member has added to that question is totally wrong. The decision was taken by the Government based on the information which we had at that time. The information which we had was sufficient for us to make the judgment-


Brian Vincent Tobin: What information did you have?
October 28, 1985


Michael Holcombe Wilson: -that the rescue package would be successful.


NATIONAL REVENUE
Ian Deans: Mr. Speaker, my question is directed to the Prime Minister. During his absence the former Deputy Minister of Finance stated that in the Olympia & York-Gulf-PetroCan deal, which came before the P and P Committee of Cabinet on a number of occasions, the matter was discussed during the time the negotiations were progressing. Why did the Prime Minister not move during that period to close the tax loophole which will allow $500 million to $1 billion of taxpayers' money to be paid out? Why did he not close it when he knew it was going to happen?


Martin Brian Mulroney: Mr. Speaker, with regard to this, the company, O&Y, exercised the right of all citizens, including corporate citizens, under the Act to seek a ruling. The ruling was made objectively by officers of the Crown in the Department of National Revenue, and presumably it became part of a package which allowed that company to make an offer. That transpired in the normal course of business, and it was not for Cabinet, retroactively or at any time in those circumstances, to place judgments upon legislation which had passed the House in, I believe, 1971.


GOVERNMENT POSITION
Ian Deans: Mr. Speaker, we all understand that it was Liberal legislation and that it had been used maybe five or six times. However, I am concerned about the following. Why did the Government, knowing that it would cost taxpayers between $500 million and $1 billion, not move during the time the negotiations were being proceeded with, in advance of the deal being consummated, to close that particular tax provision to ensure that Canadian taxpayers would not be ripped off further?


Martin Brian Mulroney: Mr. Speaker, I responded fully in that regard. Canadian citizens or Canadian corporations, under the laws which govern our jurisdiction in tax matters, have the right to address themselves directly to the Department of National Revenue to seek a tax ruling. That is what transpired.


BANKS AND BANKING
David Charles Dingwall: Mr. Speaker, my question is directed to the Minister of Finance. I find it to be terribly offensive, and I ask the Minister of Finance to clarify for Members of Parliament whether it is a decision of his and the Prime Minister that they will not
Oral Questions
answer questions with regard to that subject matter until the Estey Commission reports? Is that what the Minister of Finance is telling the House, thereby in fact resigning from his responsibilities?


Michael Holcombe Wilson: Mr. Speaker, I was referring to the specific question which has been posed, probably have a dozen times, and in many cases using exactly the same words. I do not think that it is an appropriate use of the time of the House.


Brian Vincent Tobin: That is not for you to judge.


Michael Holcombe Wilson: Nor, with respect, do I believe that it is in line with the rules of the House that I should have continually to answer the same question, time and time again, because Hon. Members cannot get it into their heads.


David Charles Dingwall: Mr. Speaker, the Minister of Finance has not answered the question repeatedly. I charge that the Minister of Finance is involved in a cover-up, and he is refusing-


Mr. Speaker:: Order, please. Is there a question?


David Charles Dingwall: Will the Minister of Finance tell the House if he knew in detail about the $116 million difference? Will he tell the House whether he knew about that particular difference?


An Hon. Member:: Yes or no.


Mr. Speaker:: Order, please.


Harvie Andre: Same question.


Carlo Rossi: Harvey, you are not the Speaker; go back to sleep.


An Hon. Member:: We all heard that.


Mr. Speaker:: I think it is clear, since we have been told, that the question being repeated will result in the answer being repeated. It does not seem to me to be in the interest of the House simply to keep repeating the same question and the same answer; it just does not seem to me to make much sense.

[ Translation]


EMPLOYMENT
Michael Morris Cassidy: Mr. Speaker, my question is directed to the Prime Minister. Is the Prime Minister aware of the fact that according to figures released by his Minister for External Trade, about 200,000 jobs in the

October 28, 1985
Oral Questions
manufacturing sector in Quebec will be threatened as a result of a free trade treaty with the United States? Since many of these jobs are in industries that are particularly vulnerable such as textiles, clothing and footwear, what assurance can he offer that a free trade agreement with the United States would not cost Quebec more than it would gain in terms of jobs?


Martin Brian Mulroney: Mr. Speaker, the Hon. Member is asking a hypothetical question, but I can inform him that despite his preamble about the job priorities he mentioned, last week I spoke directly to President Reagan about these issues in connection with certain initiatives that may be taken by the U.S. Congress and which may have a disastrous effect on production in Quebec or elsewhere. I received the assurance that the President of the United States would intervene vigorously to support certain changes or free trade between our countries, to ensure that we would not lose jobs in Quebec or the rest of Canada, pending negotiations if any.
* *
*


TEXTILE INDUSTRY
Michael Morris Cassidy: Mr. Speaker, does the Prime Minister realize that the textile industry in Quebec is losing jobs at this very moment as a result of imports, and if the President is going to intervene in the United States, will the Prime Minister and his Government intervene here in Canada to guarantee that at least half of the Canadian textile market will be reserved for Canadians and Canadian manufacturers?


Martin Brian Mulroney: Mr. Speaker, what the Hon. Member forgot to mention is that in our first year, 304,000 new jobs were created, because the Conservative Government came to power; that the unemployment rate is the lowest it has been since three years; that youth unemployment has dropped 2.2 per cent in twelve months; and that interest rates are at their lowest level in seven years here in Canada. That is an extraordinary record of economic expansion.
Furthermore, Mr. Speaker, we have a positive policy in that we do not blame our neighbours. We know that we Canadians are able to do a lot when we work together, and 300,000 new jobs are a dramatic indication of what we are capable of achieving in our economy.


PUBLIC SERVICE
John Barry Turner: Mr. Speaker, I have two questions for the President of the Treasury Board and, with your generosity, I will have a chance to ask both of them.
The first is to request, on behalf of the many thousands of superannuates in Canada, the status of negotiations concerning the indexation of the pensions that they paid for.


Hon. Robert de Cotret (President of the Treasury Board):: Mr. Speaker, further to my answer to the Hon. Member on September 26 last, I can inform him that we have received, on the management side and on the employee side, the reports of our actuarial consultants. Reports have been exchanged between the two groups, they are under study at the moment, and will lead to discussions within the next week to ten days to come to, as I mentioned at that time, a fair and equitable resolution to the issue, putting the pension fund of employees on a sound financial basis and in line with the commitments of this Party and the Government.


PUBLIC SERVANTS' PENSIONS-GOVERNMENT POSITION
John Barry Turner: Mr. Speaker, I have a supplementary question for the same Minister. I would like to know what you intend to do to restore the base of public service pensions which was eroded as a result of the unacceptable Bill C-133?


Robert René de Cotret: Mr. Speaker, this question has been raised many times by associations of employees and pensioners. They want the Government to review closely the very negative impact which that unilateral decision of the previous administration may have had on public service employees and pensioners.
The matter is indeed the subject of discussions with the groups involved and a decision will be made which I hope will be acceptable to all parties concerned.


PRICE OF NATURAL GAS
Russell Gregoire MacLellan: My question is directed to the Minister of Energy, Mines and Resources who will remember speaking at Jasper last June when she said: "There are more than two million households out there on natural gas and they will be looking for a fair deal this November."
October 28, 1985

Can the Minister assure the consumers of Canada that they will be getting a fair deal, including a cut in natural gas prices, by November 1 ?


Hon. Pat Carney (Minister of Energy, Mines and Resources):: Mr. Speaker, as I have said before, this is a matter that is under negotiation. Our officials are meeting again today, as we have met constantly over the last two weeks. I am meeting again with the western Ministers tomorrow, and I do not discuss details of these negotiations until they are concluded.


PLEDGE ATTRIBUTED TO MINISTER
Russell Gregoire MacLellan: The
Minister of Energy, Mines and Resources pledged, Mr. Speaker, that Canadians would never have to pay more for Canadian natural gas than Americans do. Is it the attention of the Minister to live up to this pledge?


Pat Carney: Mr. Speaker, I have already indicated to the Hon. Member that I will not discuss details of these negotiations in public until they are concluded. I can assure him that all Parties are trying very hard to come up with a conclusion which is fair to both consumers and producers.


BANKS AND BANKING
John Edward Broadbent: Mr. Speaker, I have a question directed to the Prime Minister. The Prime Minister knows well the meaning of ministerial responsibility. He also knows that the Estey Commission's terms of reference are such that it may not deal in the slightest way with ministerial responsibility.
Considering that the Minister of Finance just a few moments ago said that he refused to answer questions on the subject matter before the Estey Commission indefinitely into the future-


Michael Holcombe Wilson: On that particular issue.


John Edward Broadbent: -even if it is dealing with ministerial responsibility, my question to the Prime Minister is simply this. Does he agree with this complete abdication of responsibility by the Minister of Finance?


Martin Brian Mulroney: Mr. Speaker, I understood the Minister of Finance to say that he was disinclined to answer the same question repeated time and time again. He was quite open of course, as he is obliged to be, to respond to any other question at any time submitted by any Members of the House.
One of the Hon. Members referred to the Prime Minister of Great Britain. The Prime Minister of Great Britain would be
Oral Questions
very surprised to see the extent to which the Canadian Prime Minister and all Ministers are here. We try to be here every day to respond fully to the questions from Hon. Members.


BANK BAIL-OUT-INFORMATION AVAILABLE TO PRIME MINISTER
John Edward Broadbent: Considering that the Prime Minister, by his answer, has agreed that ministerial responsibility questions will be answered by the Government, 1 would like to ask him, considering that the Minister of State for Finance came into the House one Monday in March, gave an estimate of cost that was $100 million less than the Inspector of Banks conveyed to Ottawa on the Sunday night, will he as Prime Minister answer for his responsibility and tell the House did he or did he not have this information on the weekend. Please answer.


Martin Brian Mulroney: The Hon. Member does well-he always does well until he adopts the Clarence Darrow pose. In point of fact the response of the Minister of State for Finance has been full and complete.


An Hon. Member:: Yes or no?


Martin Brian Mulroney: The Hon. Member yells yes or no. One of the reasons that we responded with a commission of inquiry was pursuant to strong suggestions made by the NDP who indicated in the House of Commons that the only manner in which this matter could properly be handled would be by a commission of inquiry. We sought out someone we thought was the most distinguished person in Canada in terms of independence to conduct this commission of inquiry, and we want to let him get on with the job, and do it.


EXTERNAL AFFAIRS
Bill Attewell: Mr. Speaker, my question is directed to the Secretary of State of External Affairs but in his absence I will direct it to the Parliamentary Secretary. There was encouraging news out of Israel last week that thousands of Soviet Jews may receive permission to emigrate to Israel. I know the Parliamentary Secretary was with the secretary of State in Moscow earlier this year when the plight of refusniks was forcefully discussed. Is this encouraging news valid? Will the Jews in Russia be given freedom to emigrate, and freedom from social and religious harassment and imprisonment?
[DOT] (U50)


Mr. Gerry Weiner (Parliamentary Secretary to Secretary of State for External Affairs):: Mr. Speaker, I know the Hon. Member for Don Valley East has been very concerned about the plight of Soviet Jewry. The Government is closely monitoring the situation of Soviet Jews but regretfully sees no

October 28, 1985
Oral Questions
improvement in their predicament. Emigration remains statistically insignificant. There were only 268 exit visas authorized by the Soviet Union in the last three months, about the same as the low figures of last year.
The Government is also concerned about reports of continued cultural and religious difficulties experienced by the Jewish community. Canada is calling upon the Soviet Union to adhere to internationally recognized and fundamental human rights, which include the freedoms of religion, cultural expression, and emigration. We will continue to press Soviet authorities to permit increased Jewish emigration.


Mr. Speaker:: Order, please.


Some Hon. Members:: Hear, hear!


INDIAN AFFAIRS
B. Keith Penner: Mr. Speaker, my question is for the Minister of Indian Affairs and Northern Development. Is the Minister able to confirm to the House that he plans to spend more than $1 million on a native economic summit and trade show in Toronto next June, and is it the case that Argyle Productions, a firm headed by the Minister's good friend and political organizer, Mr. Bill Marshall, will receive over half a million dollars to put on this show?


Hon. David Crombie (Minister of Indian Affairs and Northern Development):: Mr. Speaker, I think I can confirm the first part of the Hon. Member's question and certainly reject the second part of it.


GOVERNMENT POLICY
B. Keith Penner: Mr. Speaker, in confirming that expenditure, does the Minister really feel comfortable using such a large amount of money from the Indian Community Development Program, which is not very substantial to begin with, to finance a hyped-up media event, at the same time as the people of Lubicon Lake are looking to the Minister for help and have been looking to him for quite some time in their struggle for survival?


David Edward Crombie: Mr. Speaker, I am very disappointed that the Hon. Member would suggest that it is somehow a hyped-up media event, particularly when the event has not yet been described. Certainly he has no knowledge whatsoever about it.


B. Keith Penner: What about the program?


David Edward Crombie: No, there is no program so there is no way the Hon. Member would have any understanding of it.
Am I comfortable with using funds to create jobs for Indian people? You bet. The only thing that has been done for 15 years is to give them the sickness of more welfare dollars and no money to get them into business so that they can create jobs for themselves. That is why I am comfortable with that.


Some Hon. Members:: Hear, hear!


CHARTER OF RIGHTS
Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, my question is for the Prime Minister. On Friday the Subcommittee on Equality Rights tabled a unanimous report calling for sweeping changes in federal laws and policies affecting women, the disabled, gays and lesbians, visible minorities, and the elderly, amont others. In view of the many statements made in the past by the Prime Minister calling for tolerance and respect for an full protection of minority rights, will the Prime Minister assure the House that the Government will take early action to implement these unanimous recommendations for real equality for all Canadians?


Martin Brian Mulroney: Mr. Speaker, in my absence I believe the Minister of Justice indicated that there would be a response from the Government at a reasonably early moment and I believe he indicated a time frame which would give us the time to analyse very carefully some of the very significant recommendations that have been made. That response will be provided as quickly as possible. My hon. friend can be assured that it is my hope that nothing in that response will be a variance with our belief that minority rights are indeed fundamental and very important in Canada.
[ Translation]


SEXUAL DISCRIMINATION-GOVERNMENT POSITION
Svend Johannes Robinson: Mr. Speaker, my supplementary question is also directed to the Prime Minister. Does the Prime Minister agree with the recommendation of the Sub-committee on Equality Rights-echoed as well by the Canadian Human Rights Commission and endorsed by his colleague the Minister of Energy, Mines and Resources-that discrimination based on sexual orientation must be barred by his Government, the federal Government?


Martin Brian Mulroney: In my opinion, Mr. Speaker, that would be part of the comprehensive response the Government is expected to submit to the House. I suspect the Hon. Member will not be surprised to learn that I am against any kind of discrimination whatsoever. Our imperfections notwithstanding, we are trying to build a more tolerant and equitable society in Canada and, with great difficulty, we will succeed, I am sure.
October 28, 1985


PETROLEUM INDUSTRY
Hon. Jean Chretien (Saint-Maurice):: Mr. Speaker, i have a question for the Right Hon. Prime Minister. Considering the answer he gave earlier to the New Democratic Party House Leader, could he give the House the assurance that at no time was the administrative decision concerning Olympia and York and Gulf Canada discussed in Cabinet, neither before nor after it became effective?


Martin Brian Mulroney: Mr. Speaker, perhaps the Hon. Member could explain what decisions he is talking about.


Joseph Jacques Jean Chrétien: The decision he made to allow Olympia and York a tax exemption worth between $500 million and one billion dollars. Was the administrative decision made by departmental officials discussed in Cabinet, yes or no, before or after the officials made their decision?


Hon. Elmer M. MacKay (Minister of National Revenue):: Mr. Speaker, at the risk of being repetitive, I have to tell my hon. friend opposite, who knows these things very well, that this particular ruling was discussed in the proper way by the officials of National Revenue. The Hon. Member also knows, as I have mentioned to the House before, that, contrary to some opinions that have been expressed, the taxpayers in question could have gone ahead with this particular transaction without any ruling at all. The fact that they asked for comfort, for a ruling, does not necessarily mean that this transaction was solely dependent on such a ruling.


TIMING OF CABINET'S DICUSSION OF DECISION
Joseph Jacques Jean Chrétien: Mr. Speaker, I shall make my question even more specific, either for the Minister or the Prime Minister.
I would like to know whether the administrative decision by officials of the Department of National Revenue was discussed in Cabinet or in a Cabinet committee, before or after it was made by these officials. That is what we want to know, because if the decision made by these officials was discussed by Cabinet or a Cabinet committee, it is then no longer an administrative decision but a political decision.


Martin Brian Mulroney: Mr. Speaker, the Hon. Member knows perfectly well that I cannot do that nor would he want me to break the confidentiality of what is discussed in Cabinet. However, I think I have already answered the main question, which is that the decision was made by National Revenue officials on the basis of objective criteria that apply to all taxpayers, corporate or otherwise.
Oral Questions


PUBLIC SERVICE
Ms. Lynn McDonald (Broadview-Greenwood):: Mr. Speaker, my question is for the Prime Minister who will know that Isobel Goligher was the first woman to achieve a senior managerial position with the federal Government in the Department of Supply and Services in London, Ontario, and that within a year of her obtaining this promotion she resigned under duress. Would the Prime Minister establish an independent inquiry to look into the circumstances surrounding her resignation and to ensure that justice be done in the case of Isobel Goligher?


Hon. Flora MacDonald (Minister of Employment and Immigration):: Mr. Speaker, on behalf of the Minister responsible for the status of women, I will take that question as notice and see that it is brought to his attention.


REQUEST FOR INDEPENDENT INQUIRY
Lynn McDonald: Mr. Speaker, I had a letter delivered to the Prime Minister today advising him of this matter. The request has been longstanding in his office. The only means of redress are those at his level.


Mr. Speaker:: Order, please. Is there a question?


Lynn McDonald: Will the Prime Minister agree to establish an independent inquiry since there are no further means of redress? Will he keep the word that he gave us when he agreed, as Leader of the Opposition, that an independent inquiry was the only means of redress for a person in this situation?


Martin Brian Mulroney: Mr. Speaker, I will certainly take a look quickly at the suggestion raised by my hon. friend. One of the main objectives of the Government on which we have acted effectively-not perfectly but effectively and well-has been to increase the number of women in senior responsible positions in the Public Service of Canada. We have done so dramatically, and we want to ensure that that process continues at all times and is not inhibited by the kind of alleged injustice raised by the Hon. Member. If that is the case, I will get on to it right away, and I thank the Hon. Member for raising this matter.


ENVIRONMENTAL AFFAIRS
Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, my question is directed to the Minister of the Environment who undoubtedly knows that his colleague, the Minister of Finance, is proposing a tax measure to impose a greater tax on unleaded

October 28, 1985
Tabling of Documents
gasoline than on leaded gasoline. Would the Minister tell the House what steps he intends to take to stop this anti-environmental measure which, in essence, rewards the polluter and runs counter to the acid rain policy which the Minister is applying at the present time?


Hon. Tom McMillan (Minister of the Environment):: Mr. Speaker, as the Hon. Member may know, tomorrow at three o'clock p.m. the Royal Society of Canada will be releasing a major report, undertaken for my Department, on a broad range of issues, relating to the item to which the Hon. Member refers. At that time I myself will make a public statement. I ask for the Hon. Member's indulgence and patience until I am prepared to make the statement.


CLERK OF PETITIONS' REPORTS
Mr. Speaker:: I have the honour to inform the House that the petitions, with the exception of two, presented by Hon. Members on Friday, October 25, 1985, meet the requirements of the Standing Orders as to form.
Certain petitions presented by the Hon. Member for Ottawa Centre (Mr. Cassidy) do not meet the requirements of the Standing Orders as to form.



ROUTINE PROCEEDINGS

[Stage Direction]
[ Translation]

Mrs. Monique Landry (Parliamentary Secretary to Secretary of State):: Mr. Speaker, on Friday, October 25 of this year, the Hon. Member for Ottawa-Vanier (Mr. Gauthier) pointed out a discrepancy between the English and French versions of the Government Response to the Second Report of the Standing Joint Committee on Official Languages Policy and Programs.
Mr. Speaker, in the absence of the Secretary of State (Mr. Bouchard), I wish to table today, on behalf of the Committee, a duly corrected copy of page 7 of the English version.


EXTERNAL AFFAIRS
Martin Brian Mulroney: Mr. Speaker, I would like to report to the House this afternoon on the events of the past two weeks. During that period I have had the opportunity of representing Canada at the Commonwealth heads of Government meeting at Nassau, making my first address to the General Assembly of the UN, meeting with leaders of the western industrialized nations in anticipation of the upcoming summit between President Reagan and General Secretary Gorbachev, and holding a number of bilateral meetings with leaders both in New York and in Nassau.
This morning I was able to provide Her Excellency, the Governor General, with a full briefing on these activities.
The Commonwealth heads of Government met in Nassau against a backdrop of continuing violence in South Africa and increasing international condemnation of that country's repressive policy of apartheid. Before the Nassau meeting convened, each Commonwealth country had, in its own way, taken action to express its repugnance for the intransigance of the regime in Pretoria towards the aspirations of the vast majority of South Africans-their simple desire to be free and to participate fully and responsibly in the national life of their country.
Each Government, however, was fully aware that at Nassau we would face the challenge of finding a consensus on the collective and unanimous message which needed to be sent to President Botha and the Government in South Africa.
While Commonwealth leaders began the meeting united in the belief that apartheid must end, we did not all arrive in the Bahamas agreed that economic measures were the best or even the appropriate way to signal our determination to see an end brought to systematic racial discrimination in South Africa.
In my opening statement at the conference, on behalf of all Canadians, I tried to stress the unanimity of resolve I felt existed amont Commonwealth leaders, each of whom had clearly expressed his or her abhorrence for apartheid. I also confirmed the view of Canadians that this resolve must find expression in a common program of action to enable Commonwealth countries to signal to Pretoria, clearly and without exception, that world-wide pressure against South Africa will be sustained, and must be sustained, until such time as apartheid comes to an end.


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: The discussions among leaders, which ultimately produced the Commonwealth Accord on South Africa, were long, arduous and not without some difficulties. At the same time, I thought they were characterized by a degree of good will and civility which I understand is typical of Commonwealth meetings and which contributes to what I found to be the very special nature of this forum. But no matter how challenging the negotiations, all participants readily agreed on the urgency of the situation in Souch Africa, the rightness of
October 28, 1985

the struggle against apartheid and the need for a common and united front.
The Accord articulates a unanimous call for the authorities in Pretoria to declare that the system of apartheid will be dismantled and specific and meaningful action taken in fulfilment of that intent; to terminate the existing state of emergency; to release immediately and unconditionally Nelson Mandela and all others imprisoned and detained for their opposition to apartheid-


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: -to establish political freedom and unconditionally lift the existing ban on the African National Congress and other political Parties; and initiate, in the context of a suspension of violence on all sides, a process of dialogue across the lines of colour, politics and religion, with a view, finally, to establishing a non-racial and representative Government in South Africa.

On the basis on these principles, Commonwealth heads of Government also agreed to joint measures aimed at making the Government of South Africa understand the urgency of dismantling apartheid and establishing the structures of a truly representative Government in that country.
In addition to reiterating Commonwealth support for rigorous implementation of the compulsory embargo on arms sales to South Africa and to reaffirming their approval of the Gleneagles Accord of 1977 to discourage sports encounters with that country, Commonwealth leaders have agreed to apply the following joint economic sanctions against South Africa:
-ban all new public loans to the Government of South Africa and its agencies;
-be prepared to act unilaterally to take any measures judged appropriate to ban the importation of krugerrands;
-cease all public financing for missions to South Africa as well as participation in exhibits and trade fairs in that country;
-ban the sales and exports of any computer equipment likely to be used by the South African military, police or security forces;
-ban new contracts for sales and exports of nuclear products, materials and technology to South Africa;
-ban the sales and exports of oil to South Africa;
-impose a strict and rigorously controlled embargo on imports of arms, munitions, military vehicles and paramilitary equipment from South Africa;
-impose an embargo on all military co-operation with South Africa;
Statements by Ministers
-discourage all cultural and scientific events, with the exception of those contributing to the elimination of apartheid or
not likely to promote it.	.
Mr. Speaker, all these measures have already been adopted, in some guise or other, by the Government of Canada. Some have been applied recently by the Reagan Administration and some of course had been previously approved by the British Government. Some of these measures, such as the ban on granting new loans, will have significant repercussions in South Africa.
In addition to these joint measures, heads of Government have agreed to give a restricted group of prominent Commonwealth figures a mandate to "encourage in every possible way the progress of the indispensable process of political dialogue to contribute to peaceful change and turn away the terrible threat of conflagration looming over this country".
Mr. Speaker, I am pleased to inform the House that I got in touch with the Right Hon. Pierre Elliott Trudeau last Monday and asked him to consider the possibility of becoming a member of this important contact group. I had the pleasure of formally submitting Mr. Trudeau's name and the Secretary General of the Commonwealth will go over the matter in more detail with Mr. Trudeau within a few days.
Finally, Mr. Speaker, along with the President of Zambia and the Prime Ministers of Australia, the Bahamas, India, the United Kingdom and Zimbabwe, I was selected as member of a co-ordination group responsible for steering the activities of the group of leading personalities and monitoring progress in efforts made to cause the breakdown of apartheid.
We will be meeting within six months to review the situation in South Africa.
Mr. Speaker, I think that Canada and all Canadians should feel some pride about the conclusion of the Commonwealth Accord.
During the many talks which finally led to the accord, I stressed, on behalf of Canadians, the importance of conveying clearly to the Government of Pretoria that the people and the States of the Commonwealth were determined to unite their efforts to breakdown apartheid.
We reached the objective, which was to organize common action. We are now waiting to know the reaction of South Africa.
Should the reaction be positive, we will monitor the situation very closely to assess the nature of the reform measures and the tempo of their implementation. Should it be negative, our only avenue will be to consider increasing sanctions against South Africa, either with other Commonwealth countries or alone.

October 28, 1985
Statements by Ministers

The Commonwealth leaders' meeting in Nassau also addressed in some detail the current international economic situation and Canada was honoured to make the lead statement in this discussion. I was pleased to be able to report to Commonwealth leaders that at the recent World Bank-IMF meeting in Seoul, Canada was successful in maintaining preferential lending conditions under the International Development Association for smaller Commonwealth Caribbean countries. During the economic discussions in Nassau Canada ensured that increased Commonwealth resources will be applied to activities aimed at integrating women's concerns with all of the organization's activities. I also advised Commonwealth leaders that Canada will contribute $50 million over the next three years to the Commonwealth fund for technical co-operation.
Finally, the meeting in Nasseau provided a welcome opportunity for me to meet with a group of leaders of countries with which Canada has a special relationship, the Commonwealth Caribbean. When I last met with leaders of these countries in Jamaica in February they asked, as they had asked over a number of years, for Canada's co-operation and for a special degree of understanding and comprehension of their problems in this hemisphere, and we have discussed this in the House, in dealing with a wide variety of trade problems. In Nassau, at a special meeting with them, I was pleased to advise the Caribbean leaders that Canada is responding with a wide variety of practical and concrete measures. These include the establishment of a one-way duty-free trade arrangement, which will cover 99 per cent of Caribbean exports to Canada; an amendment to Canadian legislation, which will permit the bottling of unblended rum in Canada; the development of a sourcing directory of Commonwealth Caribbean manufacturing and export capacity to assist Caribbean exports to Canada; the establishment of a system to enable Caribbean trade commissioners access to DRIE offices; and 50 new scholarships in Canada for students from the Commonwealth Caribbean area. In addition, air agreements were signed between Canada and the Governments of Jamaica, Barbados, and St. Kitts-Nevis. This was an illustration of a special responsibility that Canada has and accepts with regard to special areas of focus in the Commonwealth. We accepted that responsibility on behalf of all Members of the House, and I am delighted to report to all Members the satisfaction with which Canadian intervention in these vital areas was received by fellow Commonwealth members in the Caribbean.
The success of the Commonwealth Conference in Nassau itself, Mr. Speaker, was for me a first experience and a moving reaffirmation of the value of this very unique and special international organization. At the close of the Conference I extended Canada's invitation for the Commonwealth heads of Government to hold their next meeting in Canada in 1987, and I am pleased to announce that we expect this important meeting will be held in Vancouver, British Columbia.


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: It was a choice between Vancouver and Manicouagan.


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: Mr. Speaker, in my speech to the United Nations' General Assembly last Wednesday I addressed briefly five key issues of great importance to Canadians. I reconfirmed on behalf of all Members of Parliament the central role of both multilateral diplomacy and the United Nations in Canadian foreign policy. On behalf of all Canadians I expressed the hope that the upcoming Geneva talks between President Reagan and General Secretary Gorbachev will indeed set the world on the road towards a significant reduction in the nuclear arsenals on both sides. I reported briefly to the General Assembly on the conclusions reached at Nassau amongst Commonwealth heads of Government on a program of common action aimed at putting an end to apartheid. In light of continuing incidents of international terrorism, which has again been discussed in this House, I called for strong and co-operative action among nations to deal with this bane to the existence of civilized societies.
Finally, both in my address to the UN and later, in a separate UNICEF ceremony, I confirmed that Canada has committed an additional $25 million as our contribution to the UN target of world-wide universal immunization by 1990. If that target is reached the lives of as many as five million infants and children will be saved every year.


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: This is another indication of the unglamourous work which UN agencies do and do not always get recognition for. It was an important oportunity to draw attention to that magnificent work performed by so many people on behalf of those who sometimes do not have Parliaments, Members of Parliament and Cabinet Ministers to speak for them.
In New York I had meetings as well with Israeli Prime Minister Shimon Peres and Prime Minister Nakasone of Japan. With Mr. Peres I discussed possible joint co-operation with Israel in civilian research and development projects. Mr. Peres outlined for me his current efforts to restore momentum to the Middle East peace process. Despite recent events in the region I am heartened by the sustained commitment of both Prime Minister Peres and King Hussein to the pursuit of a just and fair-minded negotiated peace settlement. I assured Mr. Peres that this process has Canada's strong and unwavering support.
The meeting with Mr. Nakasone, our third in eight months, enabled us to deepen our already excellent personal relationship to explore the particular perspective each of us brings to the principal economic and political issues of the moment. I outlined the Government's objectives in seeking a comprehensive trade agreement with the United States and I assured him that such an agreement, if indeed it comes to pass, would be fully consistent with our GATT obligations and would in no way diminish our excellent and growing relationships with
October 28, 1985

Japan and Pacific Rim nations. At the conclusion of our discussion in New York, Mr. Nakasone invited me to make an official visit to Japan following the Economic Summit meeting in Tokyo next spring and I was pleased to accept.

Last Thursday 1 had a private conversation with President Reagan during which we discussed a few questions of common interest.
With respect to preliminary talks on the possibility of concluding an over-all trade agreement between Canada and the United States, I expressed the hope that, in these delicate times when we are getting ready for future negotiations, neither country will let isolated trade tension factors disrupt the climate required for achieving an agreement.
In that respect I pointed out to the President that we were experiencing difficulties in certain sectors such as resinous lumber, pork, potatoes, textiles and fish.
We agreed to do the utmost so as to prevent protectionist pressures in any such sector from jeopardizing negotiations on the kind of over-all agreement we both have in mind.
For his part, the President assured me that he strongly favours a climate of free and open discussions, and that he is adamantly opposed to the various protectionist propositions originating from the Congress.
More specifically, in response to a direct question put by me, Mr. Reagan suggested to me that legislative measures designed to stop the flow of Canadian goods into the U.S. would encounter his vigorous opposition.


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: The President and I agreed that our next bilateral meeting involving questions essentially of simply Canadian-American interests, although not exclusively, should take place in Washington on March 18. At that meeting we both look forward to receiving the report being prepared by Bill Davis and Drew Lewis, our special envoys on acid rain. In this regard I stressed that the search for a solution to the problem of acid rain should remain at the very top of our agenda for that meeting next March.


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: Mr. Speaker, many heads of state and heads of Government had come to New York on the occasion of the 40th anniversary of the United Nations. President Reagan took advantage of that rather unique situation and gathering to initiate discussions with the leaders of five of the principal allies of the United States of America, including Canada. The purpose was to exchange views about the forthcoming meeting between the President and General Secretary Gorbachev in Geneva. I had already conveyed some of my views on this
Statements by Ministers
subject to President Reagan in private correspondence and telephone conservations.
The President was surely right to have taken this initiative. The first meeting between the Soviet and United States leaders at the summit in six years would be a crucial event, whatever the circumstances. But it is all the more so now-it is all the more important. The Soviet Union has an impressive new leader and the United States has an experienced President who enjoys massive public support in his own country. That is so important because of the requirement of an American President to submit whatever is agreed to the Senate for ratification. As we met in New York, the six western leaders recognized that these circumstances represented perhaps a historic opportunity to set relations between the United States and the Soviet Union on a new and constructive course.
Our talks I think, Mr. Speaker, fully justified the unprecedented time devoted to them. In two sessions lasting more than five hours the President was able to present his own ideas at length and to take the views of others. The degree of mutual understanding was impressive. The President knows that he carries with him to Geneva the hopes and expectations not only of his own people, but those of all the western countries. He knows he has their full support. He understands and agrees that progress in arms control and disarmament is central and vital. But equally, he shares the view that, if progress is to be made on the central issue, all other issues that bear upon it will have to be considered, among them human rights, trade and cultural relations and regional issues. The leaders agreed that it would be unreasonable to presume bad faith on the part of the new Soviet leadership. If an honourable agreement is possible at all, we shall seek to conclude one.
In New York we agreed that it would be extremely useful if the President could provide NATO members with a full debriefing immediately following the Geneva summit. As a result, Mr. Speaker, I am pleased to tell the House today that NATO heads of Government will gather in Brussels on Thursday, November 21, to hear President Reagan's impressions of his meeting with Mr. Gorbachev.


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: Over the past two weeks, Mr. Speaker, I have had an opportunity to reassert certain major principles of our international policy and, more specifically, to reiterate our strong commitment towards the Commonwealth, the United Nations and the Western Alliance.
I know that at the close of the Nassau meeting none of the other delegations entertained any doubt whatsoever about the seriousness of the measures this Government will take to put a quick end to systematic racial discrimination in South Africa and pave the way for a total ban on apartheid.
Of course, speaking for Canada, we alone cannot achieve that, but we are proud of the fact that the Commonwealth did rise to the momentous challenge confronting it.
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October 28, 1985
Statements by Ministers
We hope that the Nassau message has been received not only in Pretoria but also in the entire community of nations, for the world will not wait indefinitely for Pretoria authorities to come to their senses.

Canadians take special pride in the significant contributions that they have made over the years to the United Nations and its many associated bodies and agencies. Distinguished Canadians such as the Right Hon. Lester B. Pearson are intimately associated in the public mind with important successes of the United Nations. It was a pleasure for me to reassert our commitment to the U.N. All Canadian Governments and all Canadian political Parties, irrespective of political allegiance, I think have held this view of the U.N. as a vital world body.
We are aware of the deficiencies and limitations of the U.N., but we continue to believe that what nations can accomplish by working together will always be greater than what any one nation can accomplish by going it alone. In this regard I take particular satisfaction from the strength, unity and vitality of the western alliance. When the leaders of the United Kingdom, Japan, Italy, West Germany and Canada met with President Reagan to discuss the forthcoming summit, the strength of cohesion of our common purpose was strongly evident. We are all deeply committed to the alliance and the principles it represents. We were also agreed that every reasonable avenue must be explored and every thoughtful attempt made to reduce tensions and promote co-operation between the two superpowers.
I encountered no disagreement, Mr. Speaker, when, on behalf of all Canadians, I urged President Reagan to go that extra mile to seek a just agreement, to presume that Mr. Gorbachev is no less interested in a secure peace. These are the ingredients that Canadians view as indispensable to the conclusion of a fair and verifiable accord. The quest for peace is everyone's business, Mr. Speaker. While Canada will not be present at the table in Geneva, our interests will. We shall remain vigilant to ensure that they continue to be defended effectively and well.


Some Hon. Members:: Hear, hear!


Joseph Jacques Jean Chrétien: Mr. Speaker, on behalf of all Members of Parliament, I would like to welcome the Prime Minister (Mr. Mulroney) back to Canada. Especially those of us on the opposition benches are very happy to see him back. I am not sure that he is that happy to be with us, but he is smiling and I think it is all right. I would like to raise a question of procedure, Mr. Speaker. This statement was delivered to my office ten minutes before Question Period. There may have been an error somewhere, and I know that was not the desire of the Prime Minister, but I am just reporting that fact. If it is an accident, it is an accident.
We welcome the Prime Minister back and we realize that over the years the survival of the Commonwealth was always related to one or more crises. The apartheid crisis was a great danger for the Commonwealth due to the great division of
views among the participants. I am glad that this problem has been somewhat resolved by the participants. Of course, we wish that Prime Minister Thatcher had moved more than a little bit, but under the circumstances I think it was better to take what was offered than to have this great association broken on this problem.
I am happy with the report that there is an agreement and there will be some sanctions put forward. I do think that the new ones are marginal. I think the most significant point is that there was an agreement, and the second most significant point is that there will be another meeting in six months. I hope that there will be progress made during that period of time. I hope that the group which has been selected to work on these problems because of their past experience in international affairs will be successful.
And I hope that under these circumstances, the Right Hon. Pierre Trudeau, our former Prime Minister, will accept to play the part the Right Hon. Prime Minister has asked him to play, and I am sure that he could make himself useful in this process and that his experience in the area of international relations would be much appreciated by the other members of the committee, and we all wish for the committee the best possible success.
I have also noted, perhaps with even more pleasure, the speech which the Prime Minister has made before the United Nations, more specifically his reference to the situation in South Africa. I feel that if both statements could be combined, we could make considerable progress, for I think we should set a time limit for the South African Government to abolish apartheid which all Canadians find abominable. Such a time limit should be clear and final.
And when the Prime Minister stated in New York that Canada would go as far as breaking off relations with South Africa unless enough progress were made within a certain time, he would have been well advised to do as the House had suggested, that is, to set a time limit, clearly indicating to that Government that if not enough progress had been made by, say, July 1, 1986, Canada would not only impose global economic sanctions against that country, but demonstrate unequivocally our disagreement by severing our diplomatic ties with it. As a matter of fact, Canada is one of the last countries of the world still with diplomatic ties with that country.
I can understand the Prime Minister's willingness to allow President Botha a certain time to operate politically within his country, considering the difficult situation which now exists in South Africa, the election which is to be held there, and Parliament which is scheduled to reconvene in early 1986. However, if in the spring or early summer of 1986, no progress has been made, I think the Prime Minister should act within six months, during the meeting which is to take place as a
October 28, 1985

follow up to the Bahamas meeting, and announce that Canada would severe its diplomatic ties with South Africa within a couple of months of that meeting.
As the Prime Minister said himself, the House unanimously condemns the apartheid system anyway. We are not very far apart as far as means are concerned, and 1 believe that the major and most important difference of opinion at this time is related to the fact that the Prime Minister has still not decided that he can set a target date after which our relations with South Africa must be severed. However, I know that he will consider the suggestion made by the Opposition and that we can continue to have a non-partisan policy in this regard.
I also want to refer to the Commonwealth Conference as the Prime Minister spoke about external aid. We are all very happy that a few minor changes have been made to create a relatively favourable impression, but it still remains, and other countries should clearly know this, that our policy has unfortunately been changed and that the objective of allocating 0.7 per cent of our gross national product to external aid has been set aside by this Government, that it has simply reduced the total amount which we had promised to provide to developing countries in external aid and that the commitment of Canada for external aid amounts to less than it did previously. However, the changes proposed here are obviously welcome even though, as a whole, they do not improve the image created by the Government when it imposed cutbacks in this regard last November.

Let me turn to the issue of world peace and nuclear disarmament which is a great preoccupation of all Canadians and the world. As the Right Hon. Prime Minister knows, the meeting between the leaders of the superpowers next month will be a great occasion. I believe we all want those two leaders to have the great wisdom to be able to find a common ground during this extremely important meeting.
1 had the privilege in May and June to travel across Canada and witness the deep concern felt by Canadians about this problem. There has been great participation by Canadians on this issue, because since January the summit in Quebec left the impression that the Government would support the star wars program. After the storm that was created, and reflecting opinions throughout Canada, we are happy that the Prime Minister and the Government decided to accept the point of view of Canadians and of the two opposition Parties. We are grateful for that.
I am somewhat disappointed that the Prime Minister did not include in his statement an attempt to put pressure on the American Government to include the star wars program or the SD1 Program on the agenda. The American administration, when dealing with Canadian problems, insists that everything be on the table when negotiating free trade. However, when negotiating peace in the world, nuclear disarmament and nuclear control, not all the issues are on the table. 1 believe that is very inconsistent. While there may be a secret which
Statements by Ministers
cannot be shared with the House of Commons, basically we must believe what we see. However, when it comes to world peace we should make it clear to the Americans that human survival should not be negotiated secretly but with our greatest skill and logic. When talking about a reduction of deadly nuclear weapons in the world, we must ensure that we do not move into a new area involving nuclear weapons in space. That is why it is so disappointing that this new escalation is left out of the equation completely. We must insist that there not be an escalation of confrontation in the universe but that there should be instead a concentration on the reduction of nuclear arms on the earth and in the sea in order to make progress toward global peace.
I hope that the meeting in Geneva in November will not be distracted as a result of too many people fdling the agenda with too many other problems that will prevent the consideration of the fundamental problem of nuclear disarmament. The fudamental problem concerns nuclear disarmament and preventing the increase of stockpiling of nuclear arms to the detriment of world peace and resulting in the creation of more hunger in the world. All the money that is spent to build these deadly weapons and develop the star war concept could be better used to feed the poor and educate the weak of the world.
I believe that we all want to remain as non-partisan as possible about these problems. When the Prime Minister travels in the near future I hope he will convey these messages from the Canadian public.
The Prime Minister referred to free trade and other matters. I want to tell the Prime Minister and I repeat to Canadians that the problem is a very, very delicate one. When I see the Prime Minister of Japan preoccupied about the global negotiations with the Americans on trade, it means we have to be careful.
In January last year I travelled in Japan. Many people were afraid about the new trend, that of the Canadian administration moving closer to the American administration. The Japanese see Canada as an international partner that can make its own decisions. They hope that Canada will remain a partner that can be relied upon as a secure supplier.
On of the fundamental problems of the Japanese Government and the Japanese businessmen, because they do not have these resources inland, is that they have to go around the world to get what they require from different countries. Up to now the Japanese have always looked upon Canada as an independent country that makes its own decisions.
If ever there were a crisis between the United States and Japan, they want to be sure that they could still come to Canada as they go to Brazil, Australia, Malaysia and so on because Canada has always been a secure supplier of goods. I am not surprised that Prime Minister Nakasone was preoccupied about the global negotiations. He must wonder why a country like Canada, having a surplus of $21 billion, wants to get into global negotiations. Canada is not going to these negotiations in a strong position, but in a week position. We

October 28, 1985
Statements by Ministers
are the ones with the surplus. It is the other side wanting to reduce the surplus. I would rather see the Government going, perhaps less spectacularly, but much more efficiently, on a one to one, problem by problem basis into these negotiations. The method used over the last 20 years has resulted in a large surplus for Canada and unfortunately for America, a large deficit for that country.
I am happy to have this occasion to welcome back the Prime Minister. After the glory of world travelling, I think that he will now deal daily with the banks, the tunas and so on-


Some Hon. Members:: Oh, oh!


Joseph Jacques Jean Chrétien: -and we will make sure that the Prime Minister has as good a time in Canada as he had abroad.


Some Hon. Members:: Hear, hear!


John Edward Broadbent: Mr. Speaker, I too join in welcoming back the Prime Minister (Mr. Mulroney). At the outset, I want to commend him on behalf of members of my Party for the generally quite constructive approach he took at his meetings while outside of our country representing the people of Canada.


Some Hon. Members:: Hear, hear!


John Edward Broadbent: The Prime Minister dealt with many important subject matters in his statement to the House. He talked about the United Nations as an organization, the Commonwealth, the IMF meetings in Seoul, trade discussions with the United States, and the importance of dealing efficiently and promptly with the acid rain problem among other matters.
Like the Prime Minister I want to concentrate on, and indeed in my case restrict my comments to, two important matters that he dealt with at greater length than he allocated to other subject matters. Specifically I shall speak about the situation in South Africa, the Commonweath response to that, and the forthcoming meeting between President Reagan and and the Secretary General of the Communist Party of the Soviet Union, Mr. Gorbachev.
First, I want to say something about the situation in South Africa. Without belabouring the points in terms of rhetoric, I do want to say that I share totally, as do the overwhelming majority of Canadians, the noble sentiments expressed by the Prime Minister in his address to the United Nations about the moral abomination of apartheid. Whatever one may say about other regimes in the world, and there are many for which Canadians have no high regard in terms of what they do to civil liberties in particular, there is no other regime in the globe of which I am aware that divides human beings in terms of their rights on the basis of race. Opposition to racism is something that ought to have, by this point in human history, united all men and women, however else they may differ in political and econonomic policy matters, in attempting to rid the world of it. I commend the approach which the Prime Minister took in his statement at the United Nations on this important question.
I understand the important situation of the Prime Minister as head of a key Government in the Commonwealth and the difficult situation with which he was confronted in trying to work toward building a consensus among Commonwealth nations on this important issue, and the fact that a consensus was achieved at all is a positive sign. Given the importance of the Commonwealth continuing in the future, it was an understandable top priority goal of the Prime Minister.
At the same time, any consensus that includes Margaret Thatcher on this important question has to be a consensus, in my judgment, that is not likely to be very effective. I say that frankly. I suspect perhaps that the Prime Minister, if he could say so publicly, might even agree with what I have just said. His task was to work for a consensus, which the Commonwealth obviously ended up producing. It would have been good to see Commonwealth leaders, perhaps in some kind of circumstance and in some kind of way, openly taking on Margaret Thatcher in this issue. I am not, of course, doubting Margaret Thatcher's opposition to racism. That is not the issue. I do not think her credentials in that regard are any worse or any better than those of anyone in this House or any worse than those of other members of the Commonwealth. I totally deplore her unwillingness in policy matters to take the kind of tough action that ought to have been taken. Had she moved, I am sure the rest of the Commonwealth nations would have been prepared to accept her move. I regret that. We now have the consensus that has been produced, and we will be looking to see what will happen with it.
The real test, as everyone in the House knows, as the people in South Africa know and particularly the black majority in South Africa knows, will come after watching the regime in South Africa over the next six months to see if there is a response that is constructive, positive and that moves in the direction of removing apartheid. The initial response by the Government of South Africa has not been encouraging. It has said, rather like the Soviet Union when such matters are being discussed, that discussion of fundamental rights and human liberties is an internal matter.
One of the great accomplishments that began somewhere in the seventeenth century and has gradually evolved in the thinking of most politicians and most people in most states is that fundamental rights are not matters to be restricted to particular nation-state Governments. Fundamental rights are human rights and they ought to concern us all. We have a moral right to be discussing them, not only as they affect our citizens, but as they affect human beings anywhere in the globe.


Some Hon. Members:: Hear, hear!


Mr. Prud'homme:: And not to be selective.


John Edward Broadbent: Of course not to be selective. The Government of South Africa has already responded to the Commonwealth declaration by saying that, in effect, it was not going to take the declaration seriously because it was an infringement on the rights of the South African Government to deny
October 28, 1985

fundamental rights to the majority of the people. Violence in South Africa has continued since the statement produced by the Commonwealth leaders.
We look, as 1 say, with interest and with-how can I put it-qualified optimism or qualified pessimism about the efficacy of the declaration in getting the Government of South Africa to change its policy in the next six months.
Unfortunately, party policies continue to be applied. Canadian men and women would like the Prime Minister (Mr. Mulroney) to answer the following questions: First, what specific criteria does our Government intend to use to monitor the situation in South Africa and determine whether changes are occuring?
Second, what kind of contingency plans have our Government and those of other Commonwealth countries prepared in case South Africa pursues its apartheid policy?

I would now like to move on to the other subject of great interest and concern to people throughout the world, that is, the general problem of disarmament, the particular problem of nuclear disarmament and, more particular still, the meeting which will take place next month between President Reagan and Mr. Gorbachev.

The meeting between President Reagan and Secretary General Gorbachev next month in Geneva could be a critical junction point in human history. The world is at a turning point in the fight to slow down the arms race, especially where nuclear weapons are concerned.
Today, Mr. Speaker, the nations of this globe spend as a whole $1 billion a year for armaments. That would be sufficient to cancel the debt of all Third World countries. It is time to change our priorities.
The Prime Minister (Mr. Mulroney) has stated that the Geneva Summit represents a unique opportunity which must not be ruined in the search for world peace. He is quite right. He also said that it is time for the United States and the Soviet Union to go a step further.
All Canadian men and women support this statement wholeheartedly. Mr. Speaker, Canada is well-known for its ability to have frank discussions with both superpowers. It is a tradition that we must continue to nourish and cherish. However, it is better cherished and nourished by practical and specific gestures.
I would like the Prime Minister himself to make this further step.

During the summer months I had occasion to visit both Moscow and Washington and to have discussions with the
Statements by Ministers
chief negotiator of the Soviet Union at the Geneva Talks which took place recently and, back to back with that meeting, to meet with his American equivalent in Washington. While the Prime Minister was meeting with the Commonwealth heads in the Caribbean, I had occasion to take part in an important disarmament meeting in Vienna, attended by a number of Prime Ministers, as well as Party leaders in the Social Democratic movement.
I say to the Prime Minister and to other people in the nation that it seems to me that a framework of agreement is possible. There is an extra concrete step which, I say to the Prime Minister, he could be and should be taking right now. If there is a conclusion which I have drawn from my own meetings in Washington and in Moscow, and from the meetings last week in Vienna, it is that the two superpowers are maintaining for themselves a certain rigidity in two key areas, one for each of them. If it were forcefully presented, with minimal rhetoric, by a number of nations, whether or not they are in the NATO Alliance, there is at least a greater chance an agreement could be reached.
The framework which seems very clear includes the following points. The first is one which the two superpowers ought to share in common, that is, to make an agreement that we now not only have a freeze on the development of more nuclear weapons but that each of them reduce some of their nuclear weaponry. The two superpowers know that the Soviet Union has an advantage in its strike force capacity into certain areas and that the United States has an advantage in certain other areas. They both know-and they have an expertise which we in this country lack-what needs to be done to have a balanced reduction on the part of the United States in certain areas, on the one hand, and on the part of the Soviet Union in other areas, on the other hand. That is to what they have to agree in common. It is not very much, I say, for people with common sense as well as expertise to say at this point in human history that they have to agree to that.
There were two other points repeated in private talks in Washington, Moscow and Vienna. First, the Soviet Union has an obligation, at long last in the history of the discussions of these matters, to say that it will accept on site verification for any announced changes leading to a de-escalation in existing levels of armaments and a commitment not to construct more. The Soviet Union must move from its historic position. Sometimes in the past it has talked about this, but it has been greatly reluctant, to understate it, to accept that kind of verification. Given its strong opposition to the great escalation in spending on star wars, the Soviet Union may well be prepared now to move on that. The Soviets have to be prepared to do that. Second, I say that the United States has to make a specific concession which the Reagan administration has been reluctant to do, that is, as has already been said in the House, to put star wars on the agenda for discussion. What kind of a discussion can there be when one of those coming to the bargaining table says: "We want you to discuss everything, but there is one thing we want left out"?

October 28, 1985
Petitions
I ask the Prime Minister to take some action on this publicly and to continue with the Canadian tradition which has been a non-partisan one. Mr. Trudeau, whom he invited to play a role in the Commonwealth, has a distinguished reputation in this field which all Canadians recognize. All Canadians, of whatever Party, recognize that Canada has played a constructive role, not simply by going along in a pre-established consensus among western countries in these matter, but from time to time speaking out in fair and clear terms to both superpowers. If we want some movement to take place on the part of both of them at Geneva next month, I say simply to the Prime Minister that time is short. Just as he called for the superpowers themselves to take that extra setp, I ask him to take that extra step himself and put before the superpowers the necessity of moving within the framework of the framework about which I have just talked.
Time is short. If we do not move in this kind of direction soon, if nations around the world do not join in on putting pressure on both the superpowers, and if we do not move on this important matter now to take that extra step for once, it may be perfectly correct to say that tomorrow will be too late.
I conclude by welcoming the Prime Minister back and by welcoming his constructive efforts at the UN and in the Commonwealth. I hope that he, too, will take that extra step which he is calling upon Washington and Moscow to take.


Some Hon. Members:: Hear, hear!


PETITIONS
Mr. Cyril Keeper (Winnipeg North Centre):: Mr. Speaker, I have the honour to present a petition from a number of residents of my riding in Winnipeg. They call upon the Government to withdraw its plan to deindex family allowances in light of the fact that those changes in family benefits will hurt the poorest and middle-income families. They call upon the Government to take action quickly on this matter.


Michael Morris Cassidy: Mr. Speaker, I have a petition signed by a number of my constituents in Ottawa Centre and a number of residents of the Province of Quebec who object to the Government's plan to deindex family allowances, who point out that families who are poor will be worse off financially, that money is being diverted from children and families into the deficit and call upon this House of Commons to reinstate full indexation of the universal family allowance and to rescind the unfair tax increases.


QUESTIONS ON THE ORDER PAPER
Mr. Paul Dick (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, I ask that all questions be allowed to stand.


Mr. Speaker:: On a point of order, the Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria).


Don Boudria: Mr. Speaker, I have a question for the Parliamentary Secretary. I want to ask him when the Government will answer Question No. 285 that I placed on the Order Paper on February 28 and Question No. 287 that I placed on the Order Paper on March 6. I also want to ask the Parliamentary Secretary when the Government intends to reply to Question No. 313 of March 28. These are all very simple, straightforward questions, for instance, the costs of renovating cabinet Ministers' offices. As well, Question No. 319 that I put on the Order Paper on April 1 involving the cost of the Quebec City conference.


Paul Wyatt Dick: I imagine, Mr. Speaker, that those questions will be answered soon.


Jean-Robert Gauthier: Mr. Speaker, I want to ask the Parliamentary Secretary a question with regard to Question No. 386 which was asked on May 31, 1985. That question deals with a pertinent subject that was the object of a question by a member of his own Party to the Minister concerning pensions of superannuates in the Public Service of Canada.
I think it would be very useful to us on the Opposition side if the figures requested, which are not that difficult to answer, were given generously by the Parliamentary Secretary, in an answer soon to be forthcoming or in whatever term he wants to use, but for God's sake, let's get this thing out.


Paul Wyatt Dick: I shall pass on the Hon. Member's representations.


Mr. Speaker:: Shall all remaining 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 a second time and referred to a legislative committee.
October 28, 1985
Mr. Speaker:: May 1 inform the House that prior to the resumption of debate because of the ministerial statement consideration of Government Orders will be extended by 57 minutes this day. Therefore Private Members' Hour will begin at 5.57 o'clock.


An Hon. Member:: On my duty day.


Mr. Speaker:: On the duty day of the Hon. Member, yes, and he knows where to take his complaint.
Resuming debate, please.


Michael Morris Cassidy: Questions and comments.


An Hon. Member:: There are two minutes left-


Mr. Speaker:: This is a good time for me to make my point. The Hon. Member wishes to complete a period of time for questions and comments which would remain were the Hon. Member present who had spoken. The fact that he is not here, in my view, when the House resumes debate after a normal interruption like lunch or overnight or a week means that the time dies.


Jean-Robert Gauthier: On a point of order-


Mr. Speaker:: That is a ruling.


George Albert Proud: Mr. Speaker, 1 make it a point of privilege.


Mr. Speaker:: Let me withdraw. I appreciate that hon. Members want to make some comments. What 1 will do for the moment is I will indicate to Members that that is certainly my intention and those who wish to communicate with me on this matter are free to do so. I think it more properly may be a matter for some conversation as opposed to a point of order structure here. Therefore, I invite the Hon. Member for Saint-Denis (Mr. Prud'homme) and the Hon. Member for Ottawa-Vanier (Mr. Gauthier) to come and see me on this question. Resuming debate.


George Albert Proud: A question of privilege, if you would allow, not on your first point, but on your last point.


Mr. Speaker:: Yes.


George Albert Proud: I would like to bring to the attention of Your Honour that I am getting a little bit, not annoyed, not suspicious, but concerned about these private discussions that could take place between Members and Your Honour outside of the framework of the House. It has happened a few times and we have a very good point-


Mr. Speaker:: The Hon. Member is making his point but it is not a question of privilege. If the Hon. Member would like me to rule, I will rule.


George Albert Proud: Mr. Speaker, I don't want you to rule, but-
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Excise Tax Act


Mr. Speaker:: Exactly. I take it that the Hon. Member did not wish me to rule. I am therefore simply resuming debate.


Jean-Robert Gauthier: Mr. Speaker, just on that same point because I think I misunderstood you. Did you say that you had rules on this question or that you were reserving your ruling?


Mr. Speaker:: I thought I was very clear. Let me make it clear to Members now. The report that brought in the proposal for questions and comments is absolutely clear on this point that the purpose of the question and comment period is to question or to have back and forth comments-


George Albert Proud: No.


Mr. Speaker:: Yes, it is. The report is absolutely clear on this point.


George Albert Proud: I don't agree.


Mr. Speaker:: Yes, it is. Would someone please bring me the report. It is at the Table. I have had it waiting for this purpose. If Hon. Members wish to push me on this I am perfectly prepared to cope with it right now. I quote from the report:
The ten minutes set aside following a member's speech should be used to question the Member or to comment briefly on the speech in a manner strictly relevant to the content of that speech.
I will find the next quote:
"Your Committee envisages that the exchanges that would take place would be sharp and short.
The quote continues:
Furthermore, the Chair should control the interventions to promote a series of exchanges to enliven the debate.
I took it on reading that that it was dead clear that the intention of the 10-minute period was to allow a back and forth relationship between a person who had made the speech and those who wished to question and comment thereafter.


An Hon. Member:: Agreed.


Mr. Speaker:: Order. Therefore, it is to me not sensible when a debate has been adjourned for a normal period of time, overnight or a lunch period or a week or whatever, to allow the questions and the comments to continue in the unavoidable absence of the Member who made the speech.


George Albert Proud: But any Member can leave the House and there can be no questions.


Mr. Speaker:: Order. Therefore, I rule that questions-


George Albert Proud: You may rule, that doesn't mean we agree.


Mr. Speaker:: That is absolutely historically true for every Speaker. Resuming debate. The Hon. Member for Nepean-Carleton (Mr. Tupper).
On a point of order, the Hon. Member for Ottawa Centre (Mr. Cassidy).

October 28, 1985
Excise Tax Act


Michael Morris Cassidy: Since I was the Member who wished to comment, I will indicate to you that according to your ruling refusing me the right to speak that I will not seek to intervene at this time on that particular question. I do appreciate that it will be-


Mr. Speaker:: The Hon. Member merely needs not to rise. To rise on a point of order to make the point is to make the point, with respect. Does the Hon. Member have a point of order?


Michael Morris Cassidy: There is a grave danger that you leave it open to an Hon. Member to withdraw after having made a speech and therefore to cut off the period of questions and comments.


Mr. Speaker:: Order. The Hon. Member might read precisely what I said to the House a few minutes ago. I said quite precisely to the House that when a normal period of interruptions such as a lunch period, overnight period or adjournment of the debate has caused a problem then it seemed to me to be unreasonable or to be against the spirit of what was intended by the Report to allow the question and comment period to continue in the unavoidable absence of the Member.
If the Hon. Member is interpreting from that that he thinks that I believe that the question and comment period can be obviated by a Member making a speech and leaving the chamber then he has not interpreted me correctly.
Resumption of debate. The Hon. Member for Nepean-Carleton (Mr. Tupper).


William Tupper: Mr. Speaker, I welcome the opportunity to rise this afternoon on behalf of my constituents of Nepean-Carleton to provide an analysis of Bill C-80 during debate on second reading. This Bill will implement the Budget proposal relating to federal sales and excise taxes and excise duties announced by the Minister of Finance (Mr. Wilson) on May 23, 1985.
This Bill complements or forms part of the Budget which had a number of components. One of the major initiatives of the Budget was the aspect of economic renewal which included items to stimulate the economy and, perhaps most important to all Canadians, to create jobs. Another aspect of the Budget was fiscal responsibility or the reduction of the deficit. It provided that we reduce the deficit partly by cutting expenditures on the one hand and by increasing revenues on the other in an equitable way.
No member of a legislature is totally comfortable with initiating legislation that creates new taxes. However, all Governments must provide leadership and certainly all progressive Governments must create new initiatives and in doing so must be equitable in their endeavours.
The Budget to which I referred has been in place for a number of months. We have already begun to see its results. We recognize that some 300,000 new jobs have been created in the past year and that the prime interest rate is down by 2.75
per cent, the lowest it has been since September, 1978. The inflation rate is steady at 4 per cent, the lowest it has been since 1971. Business investment is up by about 12 per cent over last year and business confidence is at a very high level. Housing starts and automobile manufacturing are all increasing.
Statistics Canada and DRIE surveys indicate that investment growth will be considerably greater this year. Business fixed income in the second quarter and third quarter of the year is up substantially. In the past 10 days, we have seen the report of the Federation of Independent Businesses which indicates that that sector of the economy alone created something like 250,000 new jobs in the first half of the year. The delightful thing about the report was that it indicated that those trends would continue on into the last half of the year. Furthermore, four out of 10 small businessmen who replied to the Federation's questionnaire indicated that they were going to expand their businesses in the second half of the year, and five out of 10 of them indicated that they were going to incease investments in their businesses. All of the trends from the small business community indicate an atmosphere of confidence and growth. That was expanded upon in the past week by the Economic Council of Canada which indicated that Canada's Gross National Product and its employment rate were going to grow in the coming months.
It is against that background that this Bill has been introduced. The Bill contains four main thrusts. First, consistent with the recommendations of the Nielsen Task Force, the Bill proposes to broaden the sales tax base reversing the trend which has left only 30 per cent of potential commodities within the sales tax base. The federal sales tax is a general revenue which applies to most goods manufactured in Canada or imported for use in Canada. The tax is a major source of revenue generating some $8 billion in the 1984-85 fiscal year. However, over the years, the list of products which are exempt from this tax has grown significantly.
The Government and the Ministerial task force on program review have re-examined many of these exemptions and concluded that some of them should be repealed. In some cases, the original rationale on which the exemption was based is no longer valid. In others, serious administrative and compliance problems have developed. All of the exemptions contribute to the serious deficit problems now faced by the Government. Even where the exemptions provide a valid benefit to some groups, it is necessary to carefully examine whether or not this benefit is truly required, properly targeted and reasonable in relation to the cost to government revenues.
In response to these concerns and in an effort to spread the burden of reducing the deficit over a broad range of products and consumers, the Government proposed that a number of federal sales tax exemptions be repealed. Effective July 1, 1985, a 10 per cent rate of federal sales tax was imposed on candy and confectionery products, soft drinks, pet foods and certain health goods and surgical and dental instruments. In addition, the 6 per cent tax rate applying to construction
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materials has been extended to apply to insulation materials, heat pumps and solar furnaces.
The sales tax is normally levied on the manufacturer's sale price in the case of domestically produced goods and on the duty paid value of imported goods. However, in the case of certain domestically produced construction goods, special provisions allowed manufacturers to pay taxes on the costs of raw materials used in producing the goods rather than on the sale prices. These provisions were introduced in 1963, more than 20 years ago, following the imposition of sales tax on construction materials. The measure was initially intended to address a disparity affecting concrete basements but was later expanded to cover certain metal and wooden structural products and precast concrete shapes. It also applied to ready-mix concrete.
Recent reviews of the relative burdens upon concrete, steel and wooden prefabricated products indicate, however, that the provisions available for these classes of goods actually cause competing products to bear significantly different tax burdens. Furthermore, there were disparities between those goods and other manufactured building products such as windows, doors, shingles, et cetera.
Extensive research into the issue concluded that the only fair way to tax construction goods was to impose the tax on all building components calculated on their sale price at the time of shipment by the manufacturer to the job site. The federal sales tax does not apply to the sale price of erected buildings but rather applies only to the components which are delivered to the job site for erection or incorporation into the structure.
Second, the Bill implements an element of the Government's deficit reduction strategy by increasing the rate of federal sales tax. The rate of federal sales tax will be increased by 1 percentage point effective January 1, 1986. The new rates will be 7 per cent on construction materials and cable and pay-television services, 14 per cent on alcoholic beverages and tobacco products and 11 per cent on other taxable goods.
The excise tax on gasoline and aviation fuels will be increased by 2 cents per litre and a new excise tax of 2 cents per litre has been imposed on diesel fuel and aviation fuel effective Septembre 3, 1985. These excise taxes will be increased by an additional 1 per cent per litre effective January 1, 1987. It is important to note that the latter relates to the indexation of pensions for senior residents.
Offset against these increases are the tax cuts which flow from the elimination of the Canadian Ownership Special Charge and the Oil Import Charge. The first of these substantially offsets the fiscal impact of the motive funds taxe increase while the latter is a reflection of oil price de-control.
Third, the Bill implements the campaign promise to end the automatic indexation of alcohol and tobacco taxation. In past years, these levies have been increased automatically each year on September 1. Initially the rate changes were made according to changes in the alcoholic and tobacco products subcomponents of the Consumer Price Index but following complaints from the industry and following a joint government-industry
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study, the indexing system was adjusted to track the full Consumer Price Index. This Government believes that automatically increasing the levies on alcohol and tobacco products in accordance with a rigid formula is not appropriate. Rather, such changes in tax rates should be considered and approved by Parliament. Thus, this Bill will eliminate the provisions in the Excise Tax Act and the Excise Act which automatically index these levies.
In place of the past system of automatic indexing, this Bill will implement modest increases in the excise levies on alcoholic beverages and a substantial increase in the levies on tobacco products. Effective May 24, the excise taxes on wines and the excise duties on beer and distilled spirits will be increased by 2 per cent. This is approximately half the size of the increase which would otherwise have occurred in the levies on these products under the automatic indexing system.
The taxes on cigarettes are being increased by 25 cents per package of 25 effective May 23, 1985. This is a substantial increase, but the serious health hazards associated with these products, the costs to society in general of smoking, and the need to raise significant amounts of new revenues, led to the conclusion that such an increase is approximate at this time.
The Bill also repeals-and I am delighted the Hon. Member for Ottawa Centre (Mr. Cassidy) is present-the constraints on persons who make home-brewed beer for non-commercial use for themselves and their friends. I believe the Hon. Member for Ottawa Centre has raised this question in the House previously.


Michael Morris Cassidy: It's the one enlightening thing this Government has done.


William Tupper: Home-brewers of beer will now be treated in a similar way to persons who produce wine for personal consumption.
Finally, the Bill 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 to that statute in the areas of search and seizure and the "presumption of innocence" which defers collection action until the taxpayer has had an opportunity to resolve any disputes arising with respect to his tax liability.
While addressing the inequities in the tax system is always an important objective, I want to emphasize the twin goals of the Budget again, namely to bring the deficit under control and to achieve economic renewal. With revenues covering less than two thirds of our outlays last year, with a national debt approaching $200 billion and growing rapidly, and with annual interest charges of $25.5 billion, it is essential to get our financial affairs in order.
This Bill contains, as the Minister noted last Thursday, many tough measures, including the repeal of certain sales tax exemptions and increases in the rates of tax, in addition to the

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modest changes in the taxation of construction materials. The size of the deficit is such that we must establish priorities and can no longer target the Government's limited resources to provide preferential treatment to certain products.
I urge the House to endorse this Bill at second reading and move it on to committee for detailed examination.


Mr. Deputy Speaker:: Questions or comments? Resuming debate.


Michael Morris Cassidy: Mr. Speaker, it is a pleasure to participate in this debate on Bill C-80, although it is not a pleasure to have to consider it in view of the regressive nature of the taxation within it, and in view of the fact that many of the measures in Bill C-80 are precisely the kinds of measures to which the Progressive Conservatives were opposed when they were in opposition just over a year and a half ago. I can recall that before the 1984 election, the Progressive Conservative Party opposed a sales tax increase, but after it took power it implemented the same increase to which it was opposed. The Government has now compounded that turnaround by imposing a further increase in the sales tax, a 1 per cent increase, which will amount to a total cost to the Canadian consumer of just under $1 billion in 1986-87.
I believe everyone should know just who is getting hit in this particular regard and where the costs are particularly the greatest.

The costs of this sales tax increase are incurred mainly by small and moderate income people. The most affluent in our society are the least affected by the sales tax increase, and it can be said that this is typical in my view after one year in power of the Progressive Conservative Government, that the most affluent should profit from this Government, and small and middle-income people will have to pay.
Mr. Speaker, I will remind the taxpayers that the $1 billion to be paid by them following the 1 per cent sales tax increase effective January 1st, 1986, is almost equal to what will be paid by this Government to people who had deposits of over $60,000 with the Canadian Commercial Bank and the Nort-land Bank, the two Western banks that went belly-up recently.
Mr. Speaker, those large depositors were uninsured, they had made those deposits having in mind interest rates higher than those available at the larger, respectable chartered banks or trust companies in this country. Interest rates at those two banks were higher than those at chartered banks. Although the Canadian Commercial Bank and the Northland Bank made high-risk loans, although those large depositors made deposits for business reasons, to earn slightly larger interests, although they had uninsured deposits, without the Canadian Government's guarantee, they will be getting in 1985-86 the exact amount of money that will be paid under the 1 per cent sales tax increase that is being put forth by this Government.
Now, in his May Budget, the Minister of Finance (Mr. Wilson) said it was essential to increase the sales tax. Why? To help him cover the budget deficit. Now everyone is concerned about the budget deficit. But, in fact, instead of using the funds to cover the deficit, instead of using the funds collected by way of the sales tax to create jobs or to help people in need, the Government is extorting the money from the small taxpayers, who will be paying for the tax increase, and giving it to large corporations, large depositors. And, in addition, there are $200 million or so that will be paid to foreign banks. Mr. Speaker, this is something I cannot understand.
Also, in view of the fact that the sales tax is regressive, its burden falls on low-income people. If your income is $15,000 a year, the sales tax increase proposed in Bill C-80 will cost you $140 a year. If your income is $20,000 a year, the cost will be $282 per year. If your income is $40,000, your tax incease will be $361 a year. This means that, instead of a progressive tax that would get heavier the more your income increased, we have a situation where the tax burden becomes lighter the more your income increases.
Mr. Speaker, it must also be noted that throughout the budget, and not only under the provisions of Bill C-80, the same sort of equity pervades everything. Individuals will pay tax increases under the budget to the tune of about $1 billion.
Families earning less than $40,000 will pay $490 million in tax increase because of the repeal of the federal tax reduction.
People with cars will pay $930 million in extra fuel tax. Today, Mr. Speaker, I went to a service station and I paid $35 to fill up my tank. Being a Member of Parliament, I can afford it. But for many people their automobile is an essential means of transportation. They need it to earn their living, to commute, and now they will be paying more. Why? As I said, they will be paying more to allow the Government to give money to big corporations, to the most affluent in our society.
The Hon. Member for Bonavista-Trinity-Conception (Mr. Johnson), who just contributed to the debate, said that even though he did not agree with the provisions of Bill C-80, he accepted them because they were needed so that something could be done to find the required revenues. What he failed to see is the fact, for instance, that the benefits arising out of the budget will flow mainly to individuals and corporations that are the most well off, like big oil corporations which will be saving $900 million following the removal of the oil and natural gas revenue tax. A $900 million gift to big oil corporations.
Mr. Speaker, people with fair income and owning RRSP will be earning thousands of dollars by way of tax concessions for fiscal year 1986, while low income people will pay for a sales tax increase.
According to our assessment, corporate income tax will in effect be reduced by $500 million. And, Mr. Speaker, what is
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most unfair, people who speculate, people who invest in Florida condominiums, in jewels, in art that is bought and sold on the New York, London or Paris art markets, those people who make capital gains and often contribute nothing to our society, who make no contribution in terms of job creation, those people get the windfall, they pay no tax on their first $500,000 of capital gains.
Mr. Speaker, this means that those who have enough money to afford a summer cottage or a ski chalet in addition to their city home have to pay taxes on these cottages as they are considered a second residence and a luxury, because it is obviously not necessary or essential to have a cottage in the country. This is why it has been decided that the gains on these recreational second residences should be taxed as capital gains. lTowever, in the future, Mr. Speaker, those who are wealthy enough to afford a cottage or to make profits from real estate speculation in Canada or elsewhere will no longer have to pay taxes on these profits.
As I have been saying in French, it seems extremely unjust that the series of very complex taxes presented in this Bill as a means of raising revenue to combat the deficit turn out to be a way of raising money to pay off the depositors in the CCB and Northland Banks as well as the cost of the tax gimmicks used by Olympia & York in the Gulf deal. They entered into a phoney partnership with Norcen Resources in order to make a tax saving of $500 million to $1 billion. As was evident today in Question Period, this move was not simply made without the Government of Canada being aware of what was going on. These people were not prepared to take the kind of risk the free enterprisers like to talk about. No, they went to the Government and the Minister of National Revenue (Mr. MacKay) and asked for a ruling. They wanted to know in advance that they could save the money. They were letting the Government know that this loophole, which it inherited from the Liberals, was there and they were going to use it. The people in the Department of National Revenue, quite properly, saw that this matter was too big for them to handle. It was not a small taxpayer looking for a modest and routine kind of ruling. Therefore, the matter eventually found its way into the Priorities and Planning Committee of Cabinet. The Prime Minister (Mr. Mulroney) was told. If he was not told that $500 million was floating out the window because of these tax arrangements, he certainly should have been. The Minister of Finance (Mr. Wilson) knew about it. The Deputy Minister of Finance, in an action which I think was definitely improper, tried to pretend that he would have nothing to do with it because he knew all he needed to do was pick up a telephone and he would have a job at double his present salary working for Olympia & York. He has now taken that job. The kind of intimate relationships which were involved to the cost of the little taxpayer of this country is absolutely outrageous. Yet that is the situation in which this new Government, the tribunes of the people, those who promised change when
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Canadians were looking for change on September 4, 1984, have put Canadians.
I want to comment on a couple of specific issues. As my friend from Nepean-Carleton (Mr. Tupper) points out, not everything the new Government has done is to be criticized. I said on a number of occasions that I thought Canadians wanted and voted for change. Realistically, in the Province of Quebec, for example, where our Party is on the verge of winning seats, but is not yet there, the people of Quebec voted to throw the Liberals out by voting for Conservatives. But what they expected to have-
[ Translation]
What we wanted in Quebec were real changes which would benefit ordinary people and not only the rich in our society and the big businesses which have traditionally been the friends of the Progessive Conservative Party.
We did not change the reds for the blues simply to have the same red policies, but with a blue tint. In fact, this is what we are getting. People wanted a real change, but they are not getting it.

One thing I would like to mention, and my friend from Nepean-Carleton already mentioned it, is that there is a group of people, of whom I am one, who are concerned about the quality of the beer we drink in this country. You will know that I had the temerity to break the laws of this country by offering to journalists and other interested parties some homebrewed beer in my office in the Wellington Building a few months ago. I did this in order to dramatize the fact that the present laws were unjust. They forced people who simply wanted to make some very pleasant brew in their cellar or in their recreation room or in their bathtub to break the laws of Canada. That has been changed or will be changed according to one of the provisions in this Bill. I note as well that this weekend the Ontario Government has decided to allow brew pubs in the Province of Ontario. That is something for which I worked when I was an MPP. My friend, Mr. Nick Wallen, who is a resident of my constituency, fought for both these measures and I remind him that it was the NDP, long before the Liberals tuned in, who fought for the rights of beer drinkers across the country. We are delighted to see this particular measure in the Budget.
It is not enough, however, to compensate for the other problems in the Budget. I would also like to bring to the attention of the Parliamentary Secretary and his Minister that at the time of the Budget last year a specific concern was raised with the Government not only over the taxing of supplies for diabetics but also over the taxing of an essential product for blind people who have guide-dogs, and that is the food they have to feed to the dogs. I have a number of guide-dog users in my riding. They now have a Canadian Association of Guide-Dog Users. When they raised the issue of the tax on pet food applying to them they did not get a satisfactory answer from the Government. Guide-dogs allow blind people the chance to function independently. They can

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do certain jobs that people with sight presently do. However, to tax blind people further is to jeopardize the necessary service which guide-dogs provide and reduce their employment opportunities which are already extremely slim. It has been suggested by the Canadian Association of Guide-Dog Users that there be a tax rebate for blind people if they supply Revenue Canada with receipts for guide-dog expenses. This would be similar to a sales tax, rent, or property tax rebate given to people under Ontario tax law. The Minister of Finance responded by saying that he thought a tax reduction would be more appropriate. The problem is that 80 per cent of blind people cannot work or do not have jobs. If you do not have a job it is pretty tough to pay tax and therefore pretty tough to get a tax reduction. I suggest that although this is a small point with a limited number of people involved, it is symptomatic of a lack of regard by the Government for people who are poor.
I would like to say about the deficit generally that, last August, the Government prepared a study on the cost of tax concessions given to corporations and individual taxpayers.
Mr. Speaker, the amount is about $30 billion to $50 billion, according to the report tabled by the Minister of Finance in the Clark Government, when the Conservatives were in office. Curiously and interestingly enough, the tax relief to taxpayers-mostly rich ones-is roughly equal to Canada's deficit. If our tax system were really fair, we would not grant the same tax relief to major companies, multinationals, wealthy people, and foreign controlled corporations. We would give such tax relief only to selected groups and, Mr. Speaker, that is how we would begin to build a truly fair tax system. As an example, Mr. Speaker, I would quote a statement from the Minister of Finance to the Canadian Textile Foundation: "The average corporate tax rate in Canada is about 15 per cent instead of 36 per cent." Those are tax incentives, tax relief, that is what they did.
Mr. Speaker, I note that young girls and women who work in our chartered banks pay an average tax rate which is higher than the tax rate paid by their employers despite the fact that Canada's chartered banks have assets ranging all the way up to $200 billion, $300 billion and $400 billion, that they are big corporations with a lot of financial clout. Yet ordinary people who work for the banks pay higher tax rates than their employers do. Mr. Speaker, there is something definitely unfair in that situation. Now, these small taxpayers with a yearly income of $15,000 will have to pay $140 more because of the increased sales tax which is provided for by this bill.
That is why, as members of the New Democratic Party, we are concerned about the Government's priorities. We question the priorities of any Government that believes it will create more jobs and improve the unemployment situation by giving corporations major tax breaks. That was the approach
favoured for the past 15 years by the Liberals, the Conservatives, the Quebec Liberals and the Parti Quebecois. Quebec has made the same experience and it is not working, as unemployment remains extremely high. Governments will not accept our ideas and our efforts to make sure that low income people are not penalized by our tax system but benefit from it, and to set up a tax system which is fair, and not outright unfair as this one is for low income people.


Mr. Deputy Speaker:: Questions and comments. The Parliamentary Secretary to the Minister of Finance (Mr. Lanthier).


Claude Lanthier: Mr. Speaker, I feel quite indignant. Normally, we would not bother responding to the mass of fallacious reasoning we were served up here today, but I believe I ought to raise a few points because this week, I realized that people were watching the proceedings on television. In fact, they are doing so in all ridings in Canada, and especially in wonderful LaSalle. The people of LaSalle and Ville Emard are watching the proceedings of the House.
So I would like to raise a few points and first of all, I would advise New Democratic Party Members to let Quebecers get on with their election. We can take care of ourselves, we don't need any outside help, and I would advise them to mind their own business. The references they made to the election in Quebec-this is a matter that concerns Quebecers and does not concern Ontarians or the rest of Canada. So I would advise these people to please mind their own affairs since it is none of their business.
Second, Mr. Speaker, in referring to the little guy, the New Democratic Party seems to forget the taxation restructuring that was done in the last Budget. In fact, there are two specific points I would like to mention. First of all, please notice that in the remarks made by the Hon. Member for Ottawa-Centre (Mr. Cassidy), there was no reference to the minimum tax levied on people with high incomes. It is rather unusual that this particular tax was not mentioned. Throughout these comments on the little guy, it does come as a surprise that this particular item was not referred to. An oversight, no doubt. After all, they can hardly be expected to enumerate or criticize every single item.
Second, earlier there was also a reference to a potential loss, because they were talking about a loss; mind you, potential loss and loss are not the same . . . and this was in connection with tax restructuring and the child tax credit. They also forgot that in the last Budget, there was an element of unfairness because there were people earning between $23,000 and $26,000 who were paying less taxes than people earning between $18,000 and $23,000. What we did was restructure the tax system to make taxes progressive instead of regressive. At the time, there were all kinds of bandaid solutions introduced by the party then in power, which took away an allowance here and added a tax rebate there, and when it was
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all added up, it made no sense at all. The Government has now straightened out the mess.
I would also advise people to be careful where the tax on alcoholic beverages is concerned. Mr. Speaker, as you know, I have some experience in this field. It would be very dangerous for the moral health of Canadians to decontrol completely the sale of alcoholic beverages. We got rid of that situation in 1900. We are not going to revert to a procedure or a system for the sale of alcoholic beverages that had proved to be disastrous when it was abolished in 1900. Please understand that a certain amount of regulation in the sale of alcoholic beverages is necessary, and when I hear people bragging about breaking the law to serve illicit alcohol, well, I get very angry, because it is very dangerous, and it is a dangerous precedent, whether we are talking about beer, wine or pure alcohol or spirits.
Mr. Speaker, these are the points I wanted to clear up somewhat since I felt they had been overlooked.


Michael Morris Cassidy: Mr. Speaker, in reply to my friend the Hon. Member for LaSalle (Mr. Lanthier), whom I hold in high esteem, I suggest that his attitude toward the Government's action seems to me to be somewhat on the defensive, and understandably so. He clearly disregards the fact that in my remarks I criticized the policy of the Federal Government. The reason I spoke French is that I represent a bilingual riding and that I am an elected representative for the whole of Canada. He should not exclude Quebec from Canada, even though some of his supporters might work for the Parti Quebecois during the forthcoming provincial election, I do not know. But what I deplore both at the federal and provincial levels, Mr. Speaker, is that there are two major parties in Alberta, British Columbia and in Canada, and even in Quebec there are two parties, the Liberals and the P.Q., which are leaning to the right and not paying attention to ordinary people. They disregard their problems, just as the Federal Government does. That is something the Minister chooses to ignore.
The Minister blamed me for forgetting the minimum tax. It is very difficult to forget something that does not exist. No specific step has been taken by the Government in this direction. One could read in last weekend's newpapers that the Government is considering ending this session in December and beginning a new one in February with a Speech from the Throne, instead of trying to solve the problems of unemployment, regional inequalities, as well as those concerning women and young people. We have a long list of problems to be solved, including the minimum tax, Mr. Speaker. But I should like to remind the Parliamentary Secretary that the Minister has failed so far to introduced a bill calling for a minimum tax, and it seems that this Conservative Government will do everything in its power not to levy such a minimum tax.
Adjournment Motion


Morrissey Johnson: Mr. Speaker, I am certainly glad that constituents in the riding of the Hon. Member for LaSalle (Mr. Lanthier) had the opportunity to watch the proceedings of this Chamber. I wish that I could say that all of my constituents have the same opportunity. I say that because I want to refer to a comment made by the Hon. Member for Ottawa Centre (Mr. Cassidy) when referring to my remarks this morning. He said that he was glad to know that I said that I did not agree with all that was in Bill C-80. The people in my riding do not want to watch the proceedings of the House to make sure that I will always speak the truth when I rise. If there is something in a Government Bill with which I do not agree I will not be ashamed to say it. They expect no less of me than that.
However, I want to take some exception to the fact that the Hon. Member for Ottawa Centre can get up in this Chamber, where the laws of the land are made, and proudly boast about the fact that he broke the laws of this country. I resent that and I believe it would be remiss of me if I did not rise to make that point.


Michael Morris Cassidy: Mr. Speaker, with an unjust law, there are times when one is compelled to-


Some Hon. Members:: Oh, oh!


Michael Morris Cassidy: I hope the Hon. Member will recognize that my violation of the law was perhaps a bit light-hearted but also designed in order to prove a point that there was an unjust law. While it was not as unjust as some laws that exist in this country and certainly many others, it should have been changed. In fact, it was the pressure which came from CAMRA, the Campaign for Real Ale in Canada, which I supported, that helped persuade the Government that it was time that that unjust law be changed.
I hope that some of the other unjust laws in our country which discriminate against women, young people and poor people will also be changed by the Government.


Mr. Deputy Speaker:: The period for questions and comments has now expired.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: 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.

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Member for York East (Mr. Redway)-Law Reform- Imposition of prison sentences; the Hon. Member for Ottawa-Vanier (Mr. Gauthier)-Public Service (a) Request that documents signed with unions be tabled, (b) Pensions; the Hon. Member for Broadview-Greenwood (Ms. McDonald) (a) Social Security Coalition of women for family allowances- Government position, (b) Election debate.
We will now proceed with the debate. The Hon. Member for Quebec East (Mr. Tremblay).



GOVERNMENT ORDERS

[Stage Direction]
[ Translation]

[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.
Mr. Marcel R. Tremblay (Quebec East):: Before beginning my remarks, Mr. Speaker, I would like to make a brief comment. You know how fast the situation can change here in Ottawa, and we have to revise our priorities on a regular basis. I want to commend our staff for the oustanding work they do to enable us to deliver the goods when we need them. I express my sincere appreciation to our legislative and secretarial staff for their unrelenting support and assistance.
As you may recall, Mr. Speaker, Hon. Members were eager to comment on the Budget presented by the Minister of Finance (Mr. Wilson) last May 23. I am just as pleased and honoured to take the floor today to speak to the Bill to amend the Excise Tax Act and the Excise Act. If I remember correctly, the Bill was given first reading on October 18.
As I said in a speech I delivered in this House nearly five months ago this day, the Wilson Budget is fair and equitable, realistic and productive. Mr. Speaker, I am glad to see that you remember what I said five months ago.
While Members of the Opposition do their utmost to claim that the measures are too harsh, they pretend to be tax experts and economists to say how surprised they were that the Budget was not even more drastic. The Canadian people also support the steps taken by this Government to reduce the deficit. Last September 4, they told us loudly and unanimously; Get rid of those leaders who behave like all-powerful deities and take pleasure in spending as if there were no tomorrow. I would almost dare say they were showing their irresponsibility to the people who had put their faith in them for so long.
Last May 23, Mr. Speaker, all Canadians were expecting to hear at long last the voice of reason tell them to tighten their
belts in a spirit of fairness and justice for all since no group would be favoured in relation to any other. The Government even backed down in full knowledge of the facts when senior citizens protested about the deindexing of old age security pensions.
We listen to the population when it calls for our help. We do not let the public agonize under a mountain of tax inequities.
The Budget of May 23 announced three major objectives which I will not comment today. 1 shall simply say that the first two already seem nearer as action has been taken to promote private enterprise and improve the management of public finances.
Mr. Speaker, how can we slow and eventually stop the increase of our national debt, which has now reached $200 billion? How can we correct a situation where, in the last three years, our national debt has increased by 75 per cent while our economic growth was only 25 per cent? As one of my colleagues just pointed out, the previous Government literally left us in the red, Mr. Speaker.
Massive borrowings were needed to make ends meet. The Canadian public is well aware that one third of each dollar goes to pay the interests incurred while, ten years ago, servicing the debt represented only one eighth of each dollar. Mr. Speaker, the situation faced by our Government was an aberration.
It had to try to find additional funds to prevent our country from sinking in a slump which was paralyzing all our population and even the Government itself.
Our Government got to work and decided, not to take very rigorous action to control our increasing yearly deficit, but rather to take a more cautious, a more conservative approach. We have chosen an approach which can solve, or at least reduce our debt problem given time. This is why public revenues and expenditures had to be rationalized.
Mr. Speaker, I shall now deal more directly with Bill C-80, which is especially concerned with the obtention of public revenues. I cannot overemphasize the fact that three quarters of the initiatives taken by our Government to this date to control the deficit aim at reducing expenditures rather than at increasing public revenues. This increase in the revenue produced by consumer taxes is only one more step which will guarantee to the Canadian people that our Government is keeping its promises and proving one more time that it is worthy of their confidence as concerns its management of the Canadian economy.
Our initiatives have already begun to show results. As my colleague for Nepean-Carleton (Mr. Tupper) mentioned earlier, the creation of at least 300,000 jobs has considerably reduced the unemployment rate. Inflation is going down and these tendencies should continue for a while.
October 28, 1985

I have found out in my discussions with my Quebec East constituents that my fellow citizens understand the need for the Government to control its expenditures and reduce the national debt by increasing revenue first, so as to reduce the interests which much be paid daily on our debt.
The future economic growth of this country depends on our being able to take our financial situation in hand immediately. Our measures will ensure a progressive and considerable reduction of the deficit.
The Government announced an increase in the excise tax on tobacco in the Budget speech. This has now been done. The tax increase of 1 per cent per cigarette also reflects the concern of our Government about the dangers of tobacco for all Canadians, especially our youth. It is true that the tax increase is substantial, especially as concerns tobacco. The harmful effects of the use of tobacco cause incalculable Government expenditures. This provision compares to that aimed more specifically at alcohol, except that in this case we only have a moderate increase. There is a 2 per cent tax increase on alcoholic beverages, instead of a 4 per cent increase that would have resulted from an indexed increase. We all know the federal sales tax was due for a 1 per cent increase starting from January 1st, 1986.
When deciding to maintain the indexation of old age security pensions, this Government not only showed how attentive it was to Canadians, but also showed how the deficit problem may be resolved without any negative impact on any one particular group of Canadians. For this reason, and because of the understanding of the situation shared by all our citizens, people will be treated fairly and the burden-let us make no bones about it, this is a burden we have to face-will be shared fairly by all Canadians across the land.
In order to have its revenues increased, as I said, this Government aims at reducing the interests we have to pay on all our borrowing debts. There will be a one percent tax increase on fuel effective January 1st, 1987. This will affect us all, but we know it is a necessary thing. It is aimed at no region or no group of people in particular.
Without getting into details, Mr. Speaker, I must concede the repeal of sales tax exemptions on a large number of goods will reverse the current situation. Let me explain this. By maintaining the prices of those products at the current level, we would be maintaining artificial prices. The price differentials were distorting the interaction of supply and demand. Standardizing will let market forces play their role. These rates will also eliminate the administration problems that existed to determine which items were taxable and which were not. As you know, Mr. Speaker, some companies employed people whose only job was to go through the numerous pages of literation on various kinds of products to know whether they were taxable or not.
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This Bill is fair and just, Mr. Speaker, despite what the Opposition may think or suggest.
Also, this Government is not in any way forgetting our concern for economic recovery in the process. My colleague, the Hon. Member for Levis (Mr. Fontaine), made a speech on October 24, 1985, on Bill C-80. He raised the increasing problem of inflation as it affects our exports, excluding our natural resources. The Government will deal with this by exempting exports from the excise tax. Also, all tourist literature published by any one of the three levels of Government will be exempted from the federal sales tax. Again, the Government will also foster foreign investment in Canada, while increasing its fiscal revenues.
Not only that, Mr. Speaker, but Bill C-80 introduces a comprehensive system of assessment and appeals similar to that provided under the income tax system, including the right not to pay amounts in dispute until the issue has been settled by the courts. Whatever the critics may say, Mr. Speaker, our legislation is consistently fair and equitable and organized in such a way that all Canadians are helped to bear a fiscal burden that in the long term, and for generations to come, will always be lighter than it was in the past.
I shall, if I may, reiterate the four broad principles of this Bill, Mr. Speaker, and I would say that the first one which is aimed at broadening the base of our federal sales tax will help increase Government revenues. It is a first step towards reducing the interest the Canadian Government has to pay on its loans.
The second principle embodies one of the elements of the Government's strategy to reduce the deficit by raising the federal sales tax. Increases in the excise tax on gas and fuel will compensate for the tax cuts that followed the repeal of the special "Canadianization" tax-quite a mouthful, even after one year, but Mr. Speaker, you may be assured that in time, people should be able to pronounce it without any trouble- and the tax on petroleum imports. Once again, these are measures that will affect all Canadians, and we will all have to tighten our belts together.
The third principle arises from an election promise to eliminate automatic indexation of excise taxes on alcohol and tobacco. Thus, the end of automatic indexation puts an end to future automatic revenue increases without parliamentary approval.
The fourth principle is aimed at producing a comprehensive system of assessments, objections and appeals in connection with the Excise Tax Act. The Government is not a monolith, Mr. Speaker, intent on crushing its subjects. These changes include the principle of "presumption of innocence", thus prohibiting seizure until the taxpayer has a chance to clear up any dispute regarding fiscal responsibility.
Briefly, Mr. Speaker, Bill C-80 is one more in a series of spending restraint programs implemented by this Government.

October 28, 1985
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This particular program faces up to the situation and takes the bull by the horns. Yes, we will have to increase certain taxes, but the increases are being imposed fairly. In this way, we will be able to control the Government's finances and remedy a situation that we and all other Canadians with us inherited.


Cyril Keeper: Mr. Speaker, the Hon. Member has stated that the measures to reduce the tax rate which the Government has taken are fair. How can he justify a measure which will reduce the tax rate on capital gains while increasing the sales tax? How can he say that a measure which will make the rich richer and the poor poorer is fair?


Marcel R. Tremblay: When the House dealt with the Government's plan to deindex Old Age Security Pensions, Mr. Speaker, I asked, as an experiment, a number of senior citizens in my riding to write down $200 billion, a very large figure indeed with a great many zeros. Most of them left out three zeros, Mr. Speaker, and now that they realize what a large figure it, is, they are a little sorry the Government went along with their request and they are willing to pay their share of the debt, for it is necessary to write $200,000,000,000 to realize what a huge figure that is. To reply to my hon. colleague, may I say that it is by helping those who are willing to take calculated risks risk-takers are born, not made, Mr. Speaker and to reinvest the profits they make in forever larger investments that we will replenish the coffers of the State and increase the NGP.


Mr. Deputy Speaker:: The Hon. Member for Winnipeg North Centre, a supplementary question?


Cyril Keeper: Yes, Mr. Speaker. The Hon. Member has indicated that the measure to reduce the tax rate on capital gains would yield economic benefits. I wonder if the Hon. Member is aware that nearly all economists in this country agree that it will yield no economic benefits.


Marcel R. Tremblay: Mr. Speaker, because I meet regularly the businessmen in my riding, including people involved in real estate, lenders or stockbrokers, I can tell you there is in Canada renewed confidence, so that these fine people are looking forward to investing more, increasing their share of the market and, therefore, their purchasing power, with a great many spinoffs for each and every Canadian in their everyday lives.


Don Boudria: Mr. Speaker, I am pleased to participate in the debate today on Bill C-80. It has been said that happiness is never having to say that you are Tory. I can understand why people feel that way, especially after listening to those who are in favour of Bill C-80, an Act to amend the Excise Tax Act and the Excise Act and to amend other Acts in consequence thereof. That is as it
is known in parliamentary language. It would be far better and far easier for a majority of Canadians to understand if the Bill were entitled an Act to take from the poor and give to the rich. That would probably reflect much more of the reality of what the Bill does.
What does the Act to take away from the poor and give to rich do? It raises the tax on television programming from 6 per cent to 7 per cent. It increases excise tax on wine. It repeals a section of the Excise Tax, the effect of which is to impose sales tax on certain building components and materials. It increases the federal sales tax from 10 per cent to 11 per cent. It increases the gas tax by two cents per litre on September 3, 1985 and one cent per litre on January 1, 1987. It increases the excise tax on cigarettes, tobacco and cigars. It imposes sales tax on carbonated beverages, candy, confections and pet foods. It also puts sales tax on certain health foods. Of course there has been a back-pedalling by the Minister of Finance (Mr. Wilson) on this particular measure, but it also imposes sales tax on energy conservation equipment, thereby indicating the bias of the Government against energy conservation. It imposes sales tax on previously exempted construction and building materials. That is what the Bill does.
I was interested in hearing the last Conservative Member who spoke on this matter. He said that he was in favour of all those hideous things. I want to record to show just what the previous speaking was in favour of. Now you can understand, Mr. Speaker, why the Bill should be named an Act to take from the poor and give to the rich, as I previously described.
Why do we need to have sales tax increases? How much money will be generated by them? I have a confidential table which was leaked from a cabinet document to which reference has been made before in the House of Commons. It talks about the fact that $174 million more will be generated this year as a result of the Bill, $1.2 billion next year, and $4.5 billion in 1990-91. I draw the attention of the House to the boondoggles or mistakes of the Conservative Government of the last few months, coupled with giveaways to its friends, which will cost a similar amount to the taxpayers of Canada. [Translation]
As a specific example, Mr. Speaker, I should point out that Canadian taxpayers will have to pay over $1 billion to finance the Gulf deal. All this will be done with the good wishes and compliments of the Minister of Finance (Mr. Wilson), the Minister of National Revenue (Mr. MacKay) and the other members of Cabinet.
Then, Mr. Speaker, Canadian taxpayers will have to pay about $2 billion for the Northland Bank and Canadian Commercial Bank disasters. Once again, this will be done not to bail-out a financial institution, but to save the credibility of the Prime Minister of Canada (Mr. Mulroney) because he was attending a conference and did not want to be embarrassed by the failure of a bank.
Third, Mr. Speaker, there is another Government fiasco which will cost a number of jobs in Canada, even though its
October 28, 1985

effects will not be felt for a while yet, and I am speaking of course about the Star-Kist tuna fiasco at the New Brunswick plant.
If we had all these major and even monumental mistakes of the Conservative Government, we can understand why the Conservatives need more money than they now have.

Also, the Conservatives made many promises to Canadians. As I have indicated previously on a couple of occasions, at least, they are all in the document entitled 338 Tory Promises. Since then most of them have been broken. All Canadians are welcome to have a copy of this document if they telephone my office. However, in it there are 113 promises to spend more money, 5 promises to spend less, 2 promises to increase revenues, and 26 promises to decrease revenues. Then we wonder why the Tories need more money! Had they not become involved in fiascos, they would still need more money in an attempt to live up to one or two of the promises in 338 Tory Promises. Beyond that, they have made a considerable mess of things and require further funds.
Let us look at the effect of some of the tax measures. I have received letters from constituents concerning some of the taxation measures in Bill C-80. One such letter is from the Cumberland Ready Mix company in my riding, a good employer who provides many jobs. The owner, Mr. J. B. Brazeau, wrote as follows:
We wish to make known our strong objections to the 6 per cent federal tax proposed in the Budget of May 23, 1985, on Ready Mix Concrete.
We feel the levying of this tax, at this time, is unfair. Prices have already been quoted, and contracts signed for the year.
We hereby request that if this tax must be levied it should at least be postponed until January 1, 1986.
Any assistance you may give us in obtaining at least a postponement would be greatly appreciated.
To most of us that would seem logical. One would think that if a contract was signed in April or May to provide concrete for the whole year and there was an increase in taxes, this small-businessman would have to absorb that tax.


An Hon. Member:: That is all right.


Don Boudria: I hear a Conservative Member across the way saying that that is all right. Maybe Tories are of the view that eliminating small businesses from the map is all right, but we in the Liberal Party do not feel that way. I want the record to show that we will speak in favour of small businesses, even when the Conservatives are against them.
I have a similar letter from Denis Brisbois Contractor Ltd., a contractor involved in cement and in my constituency. That company provides many jobs for the people I represent in the House of Commons. He objects to the same things as Mr. Brazeau of Cumberland Ready Mix. There are other similar employers-Centennial Constructions, Vars Concrete and so forth. They have made similar objections. The result will be a loss of jobs in my constituency, notwithstanding the fact that an Hon. Member across the way said that that was all right.
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Well, Mr. Speaker, let me tell you what the Minister of Finance replied when I wrote to him. Most of us would understand this logically; but then again most of us are not Tories. Most of us would understand this. I read in part of the letter from the Minister of Finance:
As you know, the federal sales tax is a general tax which applies to many goods produced in or imported into Canada.
I will let you, Mr. Speaker, decide how relevant that particular sentence is to the whole discussion at hand. The letter continues:
It is, in fact, the third largest source of federal revenue next only to personal and corporate income taxes.
I am sure that my constituents would be glad to hear this as well. The letter continues:
The tax is normally levied on the manufacturer's sale price in the case of domestically produced goods and on the duty-paid value of imported goods.
However, in the case of ready mix concrete and a number of other construction goods, special provisions existed which allowed the manufacturer to pay the tax on only the cost of the raw materials used in producing the goods.
That is what he had to answer to my constituent.
There are about two and a half pages of similar irrelevancies in the letter. The Minister of Finance finally concludes:
Finally, may I point out the efforts made by this Government to keep interest rates down, which is ultimately the best help it can provide to the construction industry. Indeed, interest rates have fallen by almost 3 percentage points since September 1984 to their lowest level in seven years.
Then he goes on to describe the number of housing starts
and says:
I regret that my reply could not have been more favourable.
Mr. Speaker, if you were a small contractor in my riding who had been treated unfairly by this tax and will lose money everty time you sell another ready mix truckload of concrete, what difference would receiving this kind of irrelevant answer from an insensitive Minister of Finance make? I suggest absolutely none. This is a clear example of a mistake. None of us even asked that the tax be removed, only postponed so the current contracts could expire. It made sense to most of us, but not to the Tory Government.
Last August 29 and August 30 I had the honour and the privilege to chair the national Liberal forum on the Budget. I was asked to do so by my Leader and I gladly accepted. We heard two days of testimony from various groups, many of them national groups. Let me summarize what some of them had to say to us.
We heard from the Canadian Automobile Association, certainly a very non-partisan group representing a large number of people in this country. I understand that their membership is over two million people. Here is what they had to say, and I am summarizing from the report that I have in front of me. I quote from his submission:
-the CAA believes that by addressing the deficit in the manner they have, the Government has treated the Canadian motorist unfairly and at the same time introduced measures which are counterproductive to both deficit reduction and employment growth.

October 28, 1985
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That is an organization representing 2.2 million people. That is what they had to say about this Budget. They said also that they found it unusual that since this Government had been elected, and we all remember that date, as unfortunate as it was, up until May 23 gas prices increased in this country by 18 cents a gallon.
Remember what happened to the Tories the last time they tried to increase gas prices by 18 cents a gallon? Remember what Canadians did to them? That is what they would do to them now if there was any way that we could have an election, but unfortuantely we are stuck with them. When I say we I mean not only myself as an opposition Member but all Canadians are stuck with them for the next four years. Thank God time does go by fast, not fast enough, but we will be rid of them four years from now. That is what the Canadian Automobile Association had to say about the Tory Budget and specifically about the price increases we are talking about in Bill C-80.
The Canadian Federation of Municipalities also made representations to the national Liberal forum and here is what it had to say:
The largest part of increased municipal costs is due to the removal of the tax exempt status for asphalt and ready-mix concrete. Local Governments are the primary consumers of asphalt products in Canada.
Many Hon. Members on all sides of the House have had the opportunity to sit in municipal offices in the past. I have; I sat for three terms on Cumberland Township Councils. Once the mill rate is struck that is all the mony there is for the current year. One cannot change the rate of municipal taxes once it is levied and one cannot deficit in an election year. In Ontario, this is an election year so what do the municipalities have to do? On May 23 most of them have struck their budget and have sent out their notices for municipal taxes. The municipalities have to cut back on projects, cut back on many things they want to do because this Government imposed those taxes, not on January 1 of next year so that municipalities, the largest consumers of asphalt and concrete, could plan ahead, but they did it right away, again a very regressive and completely idiotic measure on the part of the Government, which should have thought of this and subsequently modified its plan.
We also received testimoney at the national Liberal forum on the Budget from the Retail Council of Canada, and again, the groups that I am enumerating here, are certainly not partisan groups.


An Hon. Member:: Not much!


Don Boudria: They are non-partisan. I see the Hon. Member across seems to disagree. Let the record show that he does not think that the Canadian Automobile Association, the Federation of Municipalities and the Retail Council of Canada are non-partisan. Perhaps he thinks otherwise. I am sure that the membership of those organizations will be glad to hear his comments to that effect.
The Retail Council of Canada said:
The Council recognized that food and drugs could be exempted from increases and extension of the federal sales tax-
That is their view, Mr. Speaker. It said:
We regret the need to modify the personal income tax indexation provisions because we feel strongly that Government should not appear to benefit from inflation. We accept the need, at least on a temporary basis, until the deficit is under control.
They recognized that but at the same time they were saying that other things were unreasonable. They gave a balanced view but this group was quite adamant that some measures were wrong. Did the Government listen? No, Mr. Speaker.
Finally, I have two more issues I want to raise. The Association of Concerned Citizens for Preventive Medicine also addressed us, Mr. Speaker, and this group, a very worthwhile agency, a very good group, said to us that the actions of this Government in placing taxes on health care products was wrong-headed and it was to the detriment of good health care in this country. We saw the Government backtrack slightly on some of it but the issue was still strong.
Finally, I just want to draw to your attention, Mr. Speaker, recognizing the very limited time that I have, unfortunately, to the fact that a large number of my constituents are quite concerned by the fact that this Government decided in the Budget of May 23 that UIC benefits and other pension benefits cannot be used to buy spousal Registered Retirement Savings Plans. This measure goes against the women of Canada. There are many instances of people using funds from pensions and the like to buy spousal Registered Retirement Savings Plans. This has now been disallowed. In the case of an older and younger partner in a marriage, it is important to be able to transfer those funds in order to benefit the younger person, most often the woman, who will be staying alone for many years after her husband has passed on. This measure is unfair and it is one about which many people from my constituency have written to complain.
Mr. Speaker, I shall be pleased to reply to the questions Hon. Members may wish to ask about my speech this afternoon.


Mr. Deputy Speaker:: The Hon. Parliamentary Secretary to the Minister of Employment and Immigration (Mr. Hudon).


Mr. Hudon:: Mr. Speaker, I did not really intend to ask questions or make comments, but when I heard the Hon. Member talk about the price of oil and gasoline and the proposed increase of 18 cents a gallon, I felt that I had to remind him about what happened eight months later when his party regained power and by how much they increased taxes on gasoline in Canada.
Mr. Speaker, I can understand that the Hon. Member may have received letters from manufacturers or concrete processing firms, but generally, when a law or a regulation is changed, there can be some confusion during the transition period. However, I believe that people are satisfied and even quite
October 28, 1985

happy, at least in my region, that interest rates are now lower than they have been for the past seven years and that this has an impact on mortgage rates. They are happy because this stimulates the building industry. For a young couple with a $50,000 mortgage, current lower interest rates represent $5,000 over five years. This is important and it will stimulate the building industry.
We have made an effort to improve the economy generally. There is now some confidence in our economy, as evidenced by the fact that the consumption of goods has increased by 10 per cent since last year. Car purchases have increased by 23 per cent. These are obvious signs that Canadians have stopped investing their money in mere savings to take part in the economic development of our country. This will have an impact on concrete manufacturers and people in the building industry as it will affect both interest rates and the sale of consumer goods. We must be able to see both sides of an issue. If we ask someone in the building industry or with some education whether he prefers present market conditions or those which existed three years ago when interest rates were around 20 and 21 per cent, I am sure that he would choose the situation today because it is more likely to provide a better future for Canadians than was the case three or four years ago.


Mr. Deputy Speaker:: The Hon. Member for Glengarry-Pre-scott-Russell (Mr. Boudria).


Don Boudria: Mr. Speaker, I do not know whether it is worth the trouble answering, but let me try just the same to live up to the situation.
The Hon. Member for Beauharnois-Salaberry (Mr. Hudon) is referring to the interest rate as it was three years ago. I am pleased he did so, and I wonder if he is going in his next supplementary question to perhaps take credit for the sunrise or perhaps tonight's moonlight, or something else which his Government had absolutely nothing to do with. I also ask him whether he wants to take credit for the fact that interest rates also declined in the United States. It would make just as much sense, Mr. Speaker. The level of logic would be almost the same.
Second, concerning the construction rate, I would like to remind the Hon. Member opposite ... He says that over the next five years, due to low interest rates-for which he is taking credit but for which I refuse to give him that credit- anyway he says that over the next five years, a person would save $5,000. I wonder whether he is aware that construction groups in Canada have expressed the view that because of the budget brought forward by the Minister of Finance (Mr. Wilson) and also the statement of November 8, 1984, the cost of a home in Canada will increase by some $2,000, because of this Government's policies, and whether he is aware that by increasing the cost of approval, Canada Mortgage and Housing Corporation insurance premiums, the costs of building
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materials, concrete, they are jacking up the cost of building a house by $2,000 or so a year.
Does he think this is a fair provision, when we are in the process of promoting construction, when a city like Ottawa has a vacancy rate that is so low that people have nowhere to live, and this Conservative Government is striking at people who are trying to buy a home? Does he think that this is fair, Mr. Speaker? We, in the Liberal Party, do not share the view that this is fair and just.


Mr. Brisco:: Mr. Speaker, I listened to my colleague, a member of the Liberal Party, with interest and I listened to his comments about the contracts that were signed for a year in advance held by the various ready-mix concrete companies in his riding. I need only observe how very fortunate they are to have those contracts in their pockets.
There are parts of Canada including my constituency in which contracts for a year in advance are unheard of by virtue of the economy which has developed over the past four years and to which there has been a response which is slow in some areas and faster in others. One only need drive around Ottawa to see the nature of the construction industry here. I found it to be a most startling sight when I came to Ottawa in the aftermath of the last federal election. I compare my constituency as it is today to Ottawa as it is today. I can only say that the cement contractors in the Hon. Member's riding are fortunate indeed.
In fact, ready-mix cement contractors from Kootenay West have approached me as well. They see nothing wrong with the levying of this tax. The concern they do advance is about the manner in which it is being levied. They suggest, and I think perhaps rightly so, that that tax would be better levied at the manufacturers' level. They argue that because of winter conditions, there are certain additives that have to be put into the ready-mix to delay the action of the cement and there are certain concerns about distances that have to be driven when a ready-mix delivery may take place 60 or 80 miles away from the plant because of the nature of my constituency in which communities are spread many miles apart. It is the concern of the contractors that the driver of the delivery truck must then make the tax interpretation based on distance driven, the additives and the cost of the product when the driver may not have the education to make those kinds of calculations. Mistakes may be made either in favour of or against the consumer. Those kinds of things do present a problem.
In conclusion, I would only ask that before my colleague comments on all of these taxes, he consider that the Ontario Liberal Government has levied some $700 million in tax increases on the very items to which he has referred including gasoline, tobacco, beer and wine, alcoholic products and personal income tax. I think the Hon. Member must recognize that if the hat fits, and I realize he requires a large one, he should then wear it.

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Don Boudria: Mr. Speaker, regarding the size of the hat, I suppose the size of one's hat is the size that is required to hold what is inside.


John Kenneth Gormley: All kinds of air.


Don Boudria: I would like to respond to the more substantive comments made by the Hon. Member. First, he said that he had listened very closely to my remarks and he indicated that the contractors in my riding have contracts signed for a year in advance. Of course that is not what I said. I said that the contractors of my riding have contracts signed to the end of the season and, of course, the construction season will end a few weeks from now after which time one will not be able to pour large amounts of concrete. Some construction still goes on in the winter but not as much as in the summer months. The prices which were quoted were at the beginning of the season for the construction season. That does not mean they have contracts for a year in advance. That is not the case. Perhaps some of them do but it had nothing to do with what I talked about in this House today.
What I talked about is a policy which is unfair. If the Hon. Member opposite is saying that the whole issue of raising that tax is unfair, that is fine, I will agree. However, I did not even go that far in asking it to be removed. I only asked that it be delayed until January 1 of next year so as not to harm the small business people of my constituency. However, I will go along with the Hon. Member's version. Let us remove it completely.


Robert Hylton Brisco: Read the "blues".


Don Boudria: The Hon. Member opposite tells me to read Hansard later. Perhaps he should do that also and he would get straight what I said.
The Hon. Member opposite talks about the fact that the Province of Ontario has been put into debt by the provincial Tories. It is not my fault that the Tory Government of Ontario spent some $650 million of money it did not have in order to buy 25 per cent of Suncor. The Liberals are now trying to fix up the mess which Frank Miller and his friends left behind, and they will succeed.


Mr. Deputy Speaker:: Resuming debate.


Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, we have in front of us another piece of the Tory edifice being built, another brick in the wall of tax increases which we believe will lead to a severe blockage of the economic progress of this country. This particular Bill has in front of it the whole omnibus itself. We have the rates increased on federal sales taxes. We have a broadening of federal sales taxes to a whole new set of absolutely crucial items to our economy like candy, soft drinks and pet food. That shows the certain desperation of a Government when it decides that those targets somehow deserve to be taxed extra. We also have with this piece of legislation the increase in excise taxes on gasoline by two cents
per litre. Farmers, incidentally, are also going to have to pay the extra two cents per litre tax, thereby contradicting one of the promises which this Government made before its election that it would take all fuel taxes off fuel for the farm.


Mr. Thacker:: Not all.


Steven W. Langdon: That is what was said and that is what this tax contradicts.
What this legislation also does is increase the per unit taxes on different categories of alcohol by 2 per cent and, of course, a package of cigarettes is increased by 25 cents for a package of 25. All of these increases, when one adds them together, represent a colossal drain on the economy of individuals. The federal sales tax increase takes $990 million out of the economy and away from people. The cost to Canadian consumers from broadening the federal sales tax is $785 million. The total cost of the excise tax increase for gasoline is $1,325 billion. We then add on the tax increases on alcohol and on cigarettes, which makes a total excise tax increase of $1,765 billion, and the total package, the total gap in consumer spending, which will result from just this part of the Budget, is $3.54 billion. I predicted, if you recall, Mr. Speaker, when the Budget debate took place in principle last May and June, that the consequence of this massive shift of money out of the pockets of people would be to slow down the economy as compared to what would take place, and to lead as a result not to a lower deficit as was predicted, but instead to a higher deficit. What is fascinating, Mr. Speaker, is that the evidence is now proving that to be the case. The deficit is increasing rather than decreasing because the growth rate is not moving ahead with the kind of buoyancy which is requirei.


Claudy Mailly: It's better than the United States.


Steven W. Langdon: It is better than the United States but let me tell the Hon. Member that that is not good enough. We have to accelerate growth in this country if we are going to bring down the deficit. By taking $3.54 billion out of the pockets of Canadian consumers, we are doing exactly the opposite. We are slowing down growth and cutting the capacity of the farmers, workers, small business people in my constituency, and in Conservative consituencies, to go out and buy the products which will get our people back to work and get our economy producing once more. This Bill, I believe, is particularly obnoxious in the mechanisms it uses because the tax burden from these kinds of increases falls upon people for what they purchase not for what they earn. The consequence is that the increased tax burden, as a percentage, can be greater on families making little money than on families making a great deal of money. For example, a family earning $20,000 is going to pay a 1.4 percentage point increase in tax burden as a result of these various measures. A family earning $40,000 will have to pay an increase of less than 1 per cent. Therefore, what this proposal does is take a higher proportion of money from the poorer people.
That is a particular contrast with the tax decreases in the Budget package. Those tax decreases, of course, are going to
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people who have large incomes. The $500,000 lifetime capital gains exemption is going to go preponderantly to those who are quite well off in our society. If we take the last available statistics, for instance, 1982, we find that in that year 63 per cent of the value of net taxable capital gains went to persons with incomes over $50,000 per year. Those are the people who are going to gain the greatest benefits from the capital gains tax exemption. At the same time, corporate taxes are falling dramtically. I would like to refer to the speech of the Minister of Finance (Mr. Wilson) to the Canadian Tax Foundation in November of 1984. He said recent figures indicate that the effect of tax incentives has been to reduce the average federal corporate income tax rate from 36 per cent cut to 15 per cent. That is a great deal more than a 50 per cent cut in the form of some exceedingly dubious corporate tax expenditures such as accelerated depreciation which costs us $2 billion to $3 billion a year, as well as write-offs for corporate takeovers which are anything but productive. Here we have dramatically demonstrated a Bill which will unfairly remove from the pockets of ordinary taxpayers a total of $3.5 billion. At the same time this country has, over the past 10 years, put an extra $21 billion into the pockets of corporations.
If it had worked, Mr. Speaker, if as a result of all these corporate tax breaks we had a massive upswing in our economic fortunes, then as a good pragmatist I might have to sit back and say that despite what I expected success has arrived. However, every study done of this crazy, skewed-up, mixed-up, messed-up approach to tax equity shows that we did not get the extra jobs promised. We did not even get the extra investment. Yet we persist in giving more benefits and more giveaways at the same time we hit the poor consumer over the head with a total of $3.5 billion in taxes in this Bill.
That is that macro-cost of this approach, but there is a micro-cost, too. For example, in my constituency, the liquor industry, companies such as Hiram Walker and Seagram, used to employ almost 2,000 people. The massive increase in excise taxes on liquor products has devastated that industry. At this stage those companies are down to a total employment of perhaps 600 people. Again and again and again they have made a serious economic case to Government that an unfair burden is being placed on them. The workers in that industry are being asked to carry an unfair share of the load. They have explained the direct impact on the tourist industry which arises out of these higher taxes but the only consequence is another $447 million loaded on their backs by this legislation. We do not have to talk only about large industrial companies like Hiram Walker, let us talk about the small construction companies, most of which are the backbone of the Conservative Party in my constituency, a backbone which is weakening. There are companies like Scofan, Bondy Trucking and McIntosh Paving. They came to me this summer and said: "Look, we don't object to the tax being put on us for the future. All we say is that it is crazy to put that tax into effect as of July 1 when we have contracts set up throughout the summer". Nine out of 10 of the contracts in Essex County had no escalation clause to
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take into account the possibility that the Government might suddenly and arbitrarily throw a new tax on asphalt and concrete paving. These people are reasonable. They went to their Government, they wrote letters. Their construction association approached the Minister of Finance. He wrote back and said that he chose to delay the imposition of the tax until July 1 in order to provide time for manufacturers to accommodate the levy. Of course, he provided much more flexibility for other manufacturers. Gasoline did not go up until September 11, 1985. However, he would not take into account the very specific way in which these people were going to be badly damaged, not because the tax was going into effect, but because of the arbitrary nature of its timing. This Government is not only making serious economic mistakes at the macro level by taking money out of the pockets of consumers, it is not only being unfair in the way it levies taxes, but it is shooting itself and its supporters in the foot by not permitting a little flexibility with respect to when these taxes are effective.


Mr. Deputy Speaker:: It being six o'clock, the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper.


PRIVATE MEMBERS' BUSINESS-PUBLIC BILLS   CRIMINAL CODE AMENDMENTS RESPECTING ABORTION PROVISIONS
Svend Johannes Robinson: that Bill C-238, an Act to amend the Criminal Code (abortion), be read the second time and referred to the Standing Committee on Justice and Legal Affairs.
He said: Mr. Speaker, I am pleased to rise today to speak in support of Bill C-238, an Act to amend the Criminal Code to repeal those provisions dealing with abortion. I realize that this subject has given rise to a great deal of controversy and provoked strong feelings and emotions among Canadians. However, I believe it is most important that we as parliamentarians not shirk our responsibility to speak out on fundamental questions affecting the rights of all Canadians. As a member of the special parliamentary subcommittee on equality rights I had the honour to travel across this country and hear from Canadians from coast to coast representing literally millions as they outlined their concerns about issues of equality, whether they be representatives of women, the disabled, visible minorities or other minorities. One of the very serious illustrations of inequality in Canada today was brought to our attention as being the unequal provisions of the Criminal Code dealing with abortion. The effect of my Private Members' Bill would be to repeal the sections of the Criminal Code dealing with abortion and allow a women to make this very important decision herself in consultation with her doctor. This is the

October 28, 1985
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policy of the Canadian Medical Association. I want to read from a policy summary which was prepared by the Canadian Medical Association on the question of abortion. Their policy is as follows:
The Canadian Medical Association recognizes that there is justification for abortion on medical and non-medical socio-economic grounds and that such an elective surgical procedure should be decided upon by the patient and the physician^) concerned. Ideally the service should be available to all women on an equitable basis across Canada. The Association has recommended the removal of all references to hospital therapeutic abortion committees as outlined in the Criminal Code of Canada. The Criminal Code would then apply only to the performance of abortion by persons other than qualified physicians or in facilities other than an approved or accredited hospital. The Canadian Medical Association is opposed to abortion on demand or the use of the procedure as a method of birth control emphasizing the importance of counselling services, family planning facilities and services, and access to contraceptive information.
That, Mr. Speaker, is the policy of the Canadian Medical Association which clearly calls for repeal of these provisions of the Criminal Code. Why do I advocate freedom of choice, and why is this not only my position but, as well, the official policy of the federal New Democratic Party? Before coming to the grounds for this, Mr. Speaker, I would like to read that policy as reaffirmed at the federal convention of the New Democratic Party in Regina in 1983. The policy reads as follows.
WHEREAS the NDP recognizes that it is a basic right for every woman to make her own decisions about maternity,
THEREFORE BE IT RESOLVED that the NDP reaffirm the existing Family Planning Resolution (1971) which asserts that an NDP government would:
(a)	remove Sections 251 and 252 from the Criminal Code;
(b)	pardon all qualified medical practitioners convicted under Sections 251 and 252 of the Criminal Code of Canada and drop prosecutions under these sections;
(c)	provide adequate facilities in hospitals or special clinics for sterilization and abortion procedures; and
BE IT FURTHER RESOLVED that the NDP act on this resolution by supporting campaigns launched by coalitions in Manitoba, Ontario and other provinces to establish free-standing medical clinics providing a wide range of gynaecological services including birth control counselling and abortions, fully covered by provincial health insurance plans.
What is the current law in this area, Mr. Speaker? As it stands now, the law provides that abortion is legal in Canada only when a hospital abortion committee certifies that a woman's life or health is likely to be endangered by continuation of the pregnancy. The Criminal Code provisions require that abortions be performed only in an approved or accredited hospital which has a therapeutic abortion committee of at least three doctors. The committee has to rule on these applications for abortions and none of the doctors on the committee are allowed to perform the operation. There are a number of very serious shortcomings in this law as it now stands, Mr. Speaker. First of all, no hospital, even though it may be publicly financed, is required to establish a therapeutic abortion committee. Thus, even though there are over 1,300 hospitals in Canada, only approximately 250 of those hospitals have indeed established therapeutic abortion committees.
Access to safe therapeutic abortion varies widely depending on where a woman lives in Canada. In the Province of Prince Edward Island, for example, there is no access whatsoever to
safe therapeutic abortion and women in that province who are seeking abortions must travel to other parts of Canada or, indeed, to the United States. Over 70 per cent of abortions in Canada are in fact performed by a very small number of large urban teaching hospitals. This effectively denies access to abortions to women in many parts of Canada including rural communities and other communities in which there are not therapeutic abortion committees.
As well, Mr. Speaker, even though a hospital may have established a therapeutic abortion committee, that commitee is not in fact required to grant and perform any operations at all. Some 20 per cent of hospitals which have established therapeutic abortion committees in fact perform no abortions at all. No provision whatsoever is made for the many hospitals outside major cities which cannot find the means to staff such committees and perform abortions. A woman who is applying for an abortion is not allowed to appear before the therapeutic abortion committee and there is no right of appeal allowed whatsoever when a woman's application for an abortion is denied.
Back in the early 1970s a special committee chaired by Dr. Robin Badgley studied the existing provisions in the Criminal Code dealing with abortion. The Badgley Commission clearly documented what it described as sharp disparities in the distribution and accessibility of therapeutic abortion services, a continuous exodus of Canadian women to the United States to obtain this operation and delays in women obtaining induced abortion in Canada. There has been no effective action taken since the report of the Badgley Commission in 1977 to ensure that safe access is made available.
I would point out as well that the effect of the current provisions of the Criminal Code is to delay, in many cases, access to safe therapeutic abortions. It has been very clearly demonstrated that delays in this area can in fact result in the increased possibility of complications for the woman seeking an abortion. The bureaucratic hurdles which currently face a woman seeking a legal abortion result, on average, in a delay of some eight weeks from the time she first visits her doctor until the time the abortion is performed. As I said, the medical risks arising from these delays increase as the pregnancy advances. Thus, the current provisions of the Code do have an adverse impact on women.
Unfortunately, many of the women who seek abortions in Canada today are adolescents. In fact, one-third of those seeking legal abortions in 1976 were below the age of 20. I would strongly urge the Government to recognize that the most effective way of reducing the number of abortions in Canada is to promote access to safe contraceptives, to promote access to family planning counselling, to promote greater awareness of sex education in our schools, and to provide more money, not less, for research into effective forms of contraceptives, not just for women, but for men as well.
Those are the kinds of steps that can be taken to reduce the number of abortions in Canada, but instead of taking those steps the federal Government has cut back on funding to the Planned Parenthood Federation of Canada. The theory in this
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cut-back of funding to the Planned Parenthood Federation was that the provinces would pick up the slack. Well, in fact, the provinces have not picked up the slack and we have seen a very serious erosion in the provision of information about family planning, contraception and, of course, in sex education as well. This erosion is in direct contradiction to the spirit of the 1969 amendments to the Criminal Code.
That is a particularly serious problem in certain jurisdictions such as the Province of Saskatchewan where the provincial Conservative Government is actively promoting the removal of birth control information from the shelves of health centres. In fact, one of the pamphlets that the Conservative Government of Saskatchewan has removed was produced by the federal Department of National Health and Welfare. While that Government purports to be trying to reduce the number of abortions, by reducing access to information about sex education and family planning it is increasing the likelihood that there will be more abortions, particularly among young girls.
I want to speak for a moment as well, Mr. Speaker, about an individual whom I consider to be one of the most courageous men in Canada in the struggle for full freedom of choice, that is, Dr. Henry Morgentaler. Dr. Henry Morgental-er has been acquitted now by four juries and yet the injustice goes on, the trials continue. I want to stand here in the House today and say that Dr. Henry Morgentaler has done a tremendous service for Canadian women by being prepared to offer safe therapeutic abortions, in many cases to women who would have no access were his service not available. I am proud of the fact that Canadian jurists have been prepared to recognize the contribution that he has made. Of course, the legal battle-the struggle which costs so much-continues. But Dr. Henry Morgentaler, in his fight for safe therapeutic abortions, I believe should be commended. His fight for the right of women to have the choice for safe medical abortions without committees, without judgments and without delays is an objective which I share. I believe Dr. Morgentaler should be commended for assisting Canadian women in trying to achieve that important objective.
I would note as well that the provisions of the Criminal Code which allow for an appeal from an acquittal by a jury should be overturned by the Government. Both in the United States and Britain, there is no possibility whatsoever of this kind of harrassment through the judicial system. In fact, if an individual is acquitted then that acquittal stands. They are not put through the difficulty and expense of another jury trial.
The position that I have taken in support of freedom of choice is one which is shared by many Canadians. I would hope that the Government would be prepared to recognize the fact that in the most recent Gallop poll in 1982, some 72 per cent of Canadians called upon the Government to ensure access to safe therapeutic abortions. While I do not believe that Governments should run by Gallop poll, in this particular case I think it would be of some assistance to the Government.
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[Translation)
I would like to emphasize, Mr. Speaker, that even though in the Province of Quebec there are clinics set up by Dr. Morgentaler, Quebec women perhaps have better access to abortion services than their other Canadian sisters, but they still are far from enjoying the right to a free abortion. For instance, in many Quebec areas, services are not available, and the Quebec Federation of Family Planning has emphasized that the law should be changed so that women could have access to safe abortions. Also, some hospitals still refuse abortions to married women or women who are not on the pill or do not use the IUD.
I have to wonder, Mr. Speaker, what the impact will be if there is a change of Government in Quebec, if for instance the New Democratic Party does not win the elections or if by a stroke of luck the Quebec Liberal Party wins the elections. We must ask ourselves whether such a Government would respect the right of Quebec women to have access to safe abortions. [English]
This is a difficult issue. It is an issue which has divided many communities and one on which Members of all Parties can express very strong convictions. However, let me close by quoting from a lecturer from the Toronto School of Theology, who speaks about the very difficult ethical questions in this area of abortion. He says:
The overall ethical thrust of the Bible is on the side of personal responsibility and the freedom to shape one's life as an adult rather than as a child living in enforced dependency. It is opposed to any and all forms of coercion.
Theologically speaking, God has given us the right and duty to follow our own conscience. This means, ultimately, having the right to be (what others may regard as) wrong.
It is easy for commentators and preachers-most of whom are male and many of whom are celibate-to label women who seek an abortion as selfish, hedonistic, or lacking a certain "generosity of spirit." Some may well be. Most are not. They are painfully choosing the lesser of two evils and it is cruel, in pious phrases, to add guilt to their distress.
This position is not "pro-abortion"-nobody in their right mind waves a banner urging anyone to promote this route and it only muddies the issue to cling to any of the cliched slogans of either side in this debate. It is, however, pro-compassion, pro-freedom, pro a fully moral, fully human life for the women of Canada and of the world.
That is from Tom Harpur who is a freelance writer and broadcaster who lectures at the Toronto School of Theology.
In closing, I want to briefly underline the reasons for my support of this Bill and support of freedom of choice. The present law is unworkable. It is unevenly and unfairly applied. Even if we were to adopt the suggestions of some and in fact return to the days when all abortions were illegal, this would simply ensure that abortions continued but would take place at the hands of the back-street butchers or at the hands of desperate women themselves. That certainly has been shown to be the case very clearly in jurisdictions such as Portugal where abortions are illegal today. Yet, they continue in conditions of very serious risk to the women involved.
I note as well that at present there is no contraceptive that is 100 per cent safe and 100 per cent effective. Human beings are not infallible and safe legal abortion is essential as a back

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up. I would note as well that in many cases those who would not allow abortion have also opposed the right of men and women to contraception. That is the case in too many areas. I suggest that the most effective way of reducing the number of abortions in Canada is by increasing the funding to the Planned Parenthood Federation of Canada and similar provincial organizations, not cutting it as the Government is doing, and ensuring that there is access to contraception and sex education in our schools.
I hope that the Government would be prepared to adopt this measure and ensure freedom of choice for Canadian women.


Mr. Jim Jepson (London East):: Mr. Speaker, I am very happy to speak to this Bill which concerns one of the most important issues facing our country. I am even more happy, however, to have the expectation that this Bill will not receive the approval of the House.
This Private Member's Bill, presented by the Hon. Member for Burnaby (Mr. Robinson), is designed with the intention of fully legalizing abortion. It reflects the view that neither society nor the state has any business in interfering with a woman's right to make decisions fundamentally concerning herself, her body and the question of reproductive choice.
The position of the Member for Burnaby is that the option of abortion must always be open to Canadian women and that such a choice, made in consultation with a physician, must be reserved for the woman who is directly concerned. In a sense, I would like to thank the Member for bringing this motion before the House. I am very optimistic that if we co-operate we can settle this abortion debate once and for all tonight.
It seems that this is not the first time that the traditional terms of this issue have been set before the House for debate. I will be encouraging the Government, as some point, to bring forth amendments to the Criminal Code that will have the opposite effect to the Bill we see today. I believe that both public opinion and the general leanings of Parliament would support such an initiative. In any case, maybe Hon. Members present today can use the occasion of today's debate to demonstrate to the House and leaders of the Government that the great preponderance of support on this issue would encourage changes to decisively reduce the incidence of abortion.
The primary problem with abortion is simply that women have them performed. They are performed with disturbing and totally unacceptable frequency. The second problem relating to abortion is that people find themselves in a position where they are brought to see abortion as a legitimate alternative.
I believe this is more than just a statement of philosphy. It relates to the strength of a nation, the economic future of Canada and the position Canada holds for human rights around the world. It is because of a deep personal conviction that I have risen in the House today to condemn what I believe is totally irresponsible Bill. To accept this Bill today would be to abandon the moral mandate given our Government.
The sad thing with this Bill is that it will allow and even encourage women to have abortions. Moreover, it will encourage them to continue to get into positions where they will see
abortion as an easy way out. It is my understanding that the pro-choice or pro-abortion faction is pressuring, more or less, for an amendment of this type. Since this Bill neither discourages abortion nor discourages women from getting into circumstances of an unintended or unexpected pregnancy, it seems that some people are content with a sky-rocketing abortion rate. I believe that will be precisely the effect of this Bill.
Can a responsible Government consider this as an alternative? It is obvious to me that, all moral convictions aside, this Bill is quite simply bad policy. An abortion is a traumatic and emotionally difficult event, regardless of the conviction of women who choose to undergo the ordeal. This Bill is badly designed policy. It increases the frequency of these events, regardless of what other goals are aimed at in the process.
The vocal minority calling for abortion on demand is infecting our society like a degenerative disease. When I say this, I do not apologize for using words that might be considered harsh or blunt. It is common for people in favour of abortion on demand to say that I am being insensitive to the needs of problems of people who find themselves facing difficult and complex moral decisions. Unfortunately, it has become popular to define sensitive as an inclination to pass over what people see as moral or even as in their best interest and to dwell on what people want. It is now considered insensitive to insist that people might just have to put up with certain difficulties.
The disease that is infecting our entire political system is most evident in the abortion debate. This hinges on the prevalent view that Canadians are neither required nor wish to be held accountable for their actions. People are insisting on rights without acknowledging responsibilities. The Hon. Member for Burnaby and his whole Party seemingly are not willing to tell Canadians that there is a bottom line of accountability. This set of attitudes, primarily characterized by the theme of no accountability and no responsibility, can explain equally well why we have both a burgeoning abortion rate and a spiralling federal deficit.
Tonight this House has an opportunity not only to repudiate abortion on demand, but at the same time to indicate that Canadians as a whole believe there are more constructive ways to deal with the pressures encountered through life than by giving in to them.
The laws of a society must reflect its highest moral aspirations. The Bill before the House involves a practical compromise with a growing tendency. When laws are changed to accommodate unacceptable practices, invariably those practices become acceptable conventions and create new norms. As legislators, Mr. Speaker, we must accept the challenge to make laws that will have the best possible effect on Canada and Canadians.
Dr. Harley Smyth is an eminent physician at the Hospital for Sick Children in Toronto. He is well respected for his sensitivity, compassion and defence of medical ethics. I would
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like to support my remarks today with some of his which, I believe, communicate a basic principle that should underlie decisions, like this one that will, without a doubt, dramatically influence social attitudes and practices:
This half of the twentieth century is witness, on a virtually global scale, to a new creed about man-that the life of man is a biological accident-that man was made not for justice, nor for eternity, but for nothing in particular. A creature whose very decisions are, by definition, meaningless. There is a relentless pressure on governments to govern, and physicians to practise on the principles of pure utility. In this view, what is good is not what is just or what is right, but what is useful. Who is strong will survive. Who is wanted will be welcome, but the only really welcome people might be those whose minds and whose bodies will ensure high rating on a computerized cost/efficiency ledger.
When the abortion issue becomes a question of respect for human life, and it always does, that not only refers to the lives of unborn children, it also refers to our own lives. When making our own decisions on this issue, it says something about our own lives, our human dignity and the purpose of our society. Laws that freely allow abortion repudiate any possibility of a higher human purpose.
Everyone will admit to having a basic sense of what is right and wrong, and it is this sense that, I believe, provides everyone with an intuitive bias against abortion. As a Government, we can sometimes be in danger of inadvertently extinguishing any feelings of personal obligation to oneself or to a moral standard. Abortion legislation is a clear example of this. I hope Members will join me in voting against this Bill.
So far I have dwelt mainly on the philosophical objections to abortion. I think they stand by themselves and prevail over the abortionist arguments favouring a woman's right to reproductive choice. It is obvious to me that by the time a woman is pregnant, she has already made her choice. I will stick to that view even though there are those who would prefer to see an unintended pregnancy as an inconvenience that is easily done away with. In any case, I would like to present to the House some figures that will help people to understand the scope of the problem with which we are trying to deal.
The most staggering figure I could cite is the number of abortions performed. In 1982, there were 66,000 therapeutic abortions performed for women resident in Canada. It is obvious that a pregnancy terminated by an abortion is not an exceptional case. It is not extraordinary. It is not unusual. The number of abortions performed has been constantly growing. In 1981, the City of Toronto released figures stating that 8,300 abortions were performed while there were only 7,600 live births. When abortions are more popular than live births, I think things are getting out of control. There are still some people who claim they are denied freedom of choice.
If their freedom of choice continues to lower the birth rate and raise the abortion rate, I think that reflects an abusive freedom, and a repudiation of responsibility. When the abortion rate is as high as it is now, you can be sure that the whole question has become a decision that is taken very lightly, Mr. Speaker. Through the negligence of Parliament, abortion has become acceptable in the sense that a great number of women are making casual decisions about reproductive choice and
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exploiting the latitude provided by the way current laws are enforced.
Why, in 1982, over 11,000 women had an abortion for the second time. Over 2,000 had one for the third or fourth time. When people try to defend the practice of abortion, they always create extreme circumstances surrounding the event. They might say the mother's life was threatened or that it was a pregnancy due to rape or that the person was particularly young and unequipped emotionally. This convinces some people that there might be justifications for abortion.
When over 11,000 women had their second abortion in one year there are going to be among that number a great many people who have been irresponsible and who have made the wrong choice. For this irresponsibility, 60,000 unborn children are killed each year. The tragic thing is that with permissive laws, and they are already too permissive, these decisions are taken out of the moral context. Pro-abortion groups say that if a woman chooses to have an abortion, she must be correct to exercise that right.
I have never heard a group in favour of choice ever say that, in some cases, it is better to go through with the pregnancy. This disturbs me because abortion is in the process of ceasing to be a difficult moral question for those who have had one. I am personally opposed to them on any grounds. Not everyone is, but I would hope that most people would still admit that there is no justification for the majority of abortions.
The private Members' Bill under consideration today makes no recognition of the fact that most Canadians see abortion as something that should be positively avoided, even if they might condone it in some circumstances. I hope that we will never pass a Bill like this that would make abortion a casual personal decision or just another form of birth control.
The issue of abortion has given the medical community a much more uncomfortable time than it has presented to the pro-choice movement, who do not see it as nearly so difficult. That is probably because it is the doctors themselves who are given the ultimate responsibility for performing abortions. Many doctors refuse to perform abortions, and I have a great deal of respect for them for upholding their professional standards. Doctors are dedicated to a code of medical ethics, the point of which is to guide human action so that they will be consistent with social values.
Canadians believe that life is worth protecting. In 1982, they spent $30 billion or 8.4 per cent of our Gross National Product because they believed that life is the greatest gift we can be given. It seems ironic to me that Canadians take life so seriously, while some people believe killing should be legalized, killing for no reason other than convenience most of the time.
Maybe the Hon. Member for Burnaby believes that you have to be able to fight for your share of that $30 billion pie. Maybe medical treatment and health protection is not a right at all, but rather something you earn yourself. In this case society might be justified in turning its back on unborn children. Since Canadians spend $1 out of every $10 protect-

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ing and saving lives, it tells me that they cherish their own lives, the lives of their families and of their friends.
It is precisely the function of an institution such as Parliament to correct failures in our country's equation of social and political justice. A key part of this is recognizing and promoting rights of underprivileged or deprived minorities. The Government has committed itself to championing the causes of women, ethnic minorities and the handicapped, three groups fitting this description. I hope we will take up the challenge with equal enthusiasm of defending the interests of the most defenceless group of all-the unborn children of Canada.
There is a final point which I should like to make that always emphasizes the senselessness and tragedy of the frequency of abortion in our country. The futility of the situation we have today is emphasized by the currency of the term "unwanted pregnancy". No greater insensitivity is shown than by people who persist in using this term.
There is an unlimited number of families in Ontario alone who would treasure an "unwanted pregnancy" and welcome an adopted child into their home. In Ontario, in 1969, official agencies processed the adoption of 5,400 children. In 1979, this figure had fallen to 1,248. By 1984, last year, 862 children were adopted through provincial agencies in Ontario. People have not lost interest in adoption. As much as ever, some couples are incapable of producing children. Maybe the fact that abortions have increased over 600 per cent in the same time span has something to do with it. The term "unwanted pregnancy" loses some of its meaning when one finds out that there is a five-year waiting period for adoptions in Ontario.
Passing this legislation would legitimize the "unwanted pregnancy" as one that can be properly aborted. When this is used as a justification for abortion, it is a selfish and thoughtless treatment of not only the unborn child but of the thousands of people who would do anything to give that baby a home.
Before closing, I think it is important for the people of Canada to be totally aware of how abortions are carried out, the procedures involved. There is the D & C or the dilatation and curettage abortion. This method is most often used in the first 13 weeks of pregnancy. A tiny hoe-like instrument, the curette, is inserted into the womb through the dilated cervix, its natural gateway. The abortionist then scrapes the wall of the uterus, cutting the baby's body to pieces. This is now used less frequently than suction.
The second procedure is suction abortion, the most commonly used method for early pregnancies. The principle is the same as in the D & C. In this technique, which was pioneered in Communist China, a powerful suction tube is inserted through the cervix into the womb. The body of the developing baby and placenta are torn to pieces and sucked into a jar.
The third is salt poisoning, or hyper-natremic abortion. This method is generally used after 13 weeks of pregnancy. A long needle is inserted through the mother's abdomen and a strong salt solution is injected directly into the amniotic fluid which
surrounds the child. The salt is swallowed and "breathed" and slowly poisons the baby, burning his or her skin as well. The mother goes into labour about a day later and expels a dead, grotesque, shriveled baby. Some babies have survived the "salting out" and were born alive.
These are just some of the forms of abortion which are carried out today. However, I should like to conclude by simply requesting that all Hon. Members seriously consider the implications of the abortion question. The time has come that the majority of Canadians who clearly oppose the senseless killing of infants receive their rightful voice in this matter, and silence once and for all the voice of the vocal minority of Canada.


Some Hon. Members:: Hear, hear!


Mr. John Oostrom (Willowdale):: Mr. Speaker, I welcome the opportunity to speak to the Bill introduced by the Hon. Member for Burnaby (Mr. Robinson). Abortion is an issue on which fundamentally differing and opposing views are strongly and genuinely held by many Canadians. I recognize the underlying reasons and feelings which have prompted my hon. colleague to introduce the proposed amendment to the Criminal Code. However, because there is a lack of consensus for major change in the abortion law, and because I believe that the existing law strikes a somewhat fair balance for Canadians who hold opposing views, it would be premature to bring forth such an amendment. In short, further study and consultation with church, medical and community groups are required. Nonetheless, I believe it would be useful to have a discussion on this very important issue, so that we can increase our knowledge of the many questions involved. In this regard, I propose to take the next few minutes of my time to place the Canadian situation in respect of abortion into an international context.
The debate over abortion rages in Canada as in many, if not most, countries of the world. Perhaps no other issue raises so many fundamental legal, medical, social, political, philosophical and religious questions as does the issue of who shall dictate the future of a human being about to be born-the state, the mother or the father. At one extreme, the state determines the status of a human being by criminalization of the abortion procedure and imposition of governmental sanctions, for example, imprisonment, fine or other penalty, upon those engaged either in performing the operation or having the operation performed upon them. At the other extreme, by permitting the potential mother or father to decide whether or not to have the child, the state removes itself completely from the decision-making process and places the choice entirely in the hands of future parents.
Most societies have opted for an intermediate position and allow abortions to be performed when certain legally formulated indications are present. As with other medical procedures, the state reserves the right to regulate the competence of those performing the operation. The intermediate position has been created by attenuating the criminal sanctions imposed upon violators of the penal code through legislative
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action, judicial interpretation, or simply by choosing not to prosecute blatant evasions of the law.
The harshest restrictions on abortion exist in such countries as Ireland, Portugal, the Philippines and Spain, where no exemption from the absolute prohibition against abortion is permitted, not even for the narrow purpose of saving the mother's life.
Less restrictive nations permit abortion for medical indications. For example, exemptions are allowed when abortion is necessary for health reasons. These are the most common abortion statutes. As exceptions to a penal code prohibiting abortion, these exemptions are widely favoured because they can be interpreted as narrowly or as liberally as the courts and legislatures of the various nations desire. Interpretations range from a literal definition of health, protecting the life of the mother, to an expansive view which includes preserving the physical or mental well-being of the pregnant woman. More liberal laws allow for the termination of pregnancy on evidence that the child will be mentally or physically deformed if the pregnancy goes to term, or that manifestation of an hereditary disease will be prevented by permitting a legal abortion. Ethical or legal indications laws permit abortions for most women whose pregnancies result from rape or incest. Laws setting forth medico-socio or social indications conclude the list of exemptions by permitting legal abortions to be performed for a wide variety of medical and non-medical reasons. Such minimally restrictive abortion laws are found in Japan, the United Kingdom, the Scandinavian nations and the countries of eastern Europe. There, abortions are legally performed for such reasons as difficult domestic situations such as too many other children, financial hardship, unmarried status or ill health of other family members. However, these social reasons are generally disallowed, as they should be, in most countries of western and southern Europe, Latin American, Asia Africa and here in North America. In short, most of the world has approved the rights of the unborn. If Bill C-238 is adopted in the House, the rights of the unborn would not be protected, as the Hon. Member for London East (Mr. Jepson) has so ably pointed out a few minutes ago.
The least restrictive type of abortion law permits abortions "upon demand", although usually within a limited period. These laws allow a woman, after consultation with her physician, to choose to terminate a pregnancy without the need to offer an officially sanctioned justification. The distinction between this type of liberal abortion policy and the medico-social indications policy is that with the latter the woman is still required to convince a doctor, a hospital, or a committee of medical or psychiatric personnel of the validity of the indication.
By January, 1974, only seven countries legally permitted abortion at the unconditional request of the woman: the People's Republic of China, Denmark, the German Democratic Republic, Tunisia, the Soviet Union, the Democratic Republic of Vietnam and the United States. By 1977, France, Austria
Criminal Code
and Sweden joined this group. Even such nations, however, maintained restrictions upon personnel or facilities used for the operation.
Most of the attempted changes in abortion policy have taken place in Western Europe. Italy's-one of the most recent- liberalization of abortion laws in May, 1978 allowed women over 18 years old to opt for termination of their pregnancy during the first three months for physical or mental health reasons, ethical considerations, or socio-medical indications such as economic deprivation or family pressures. France adopted a liberal abortion policy in 1975 by removing penal sanctions from abortions performed in the first ten weeks of pregnancy.
The UK Parliament enacted a liberal abortion statute in 1967, authorizing abortion upon certification by two physicians that the pregnancy would involve greater injury to the physical or mental health of the women or their existing children than if the pregnancy were terminated. Furthermore, a woman's "total environment" may be considered in this decision as well as eugenic and ethical considerations.
The 1967 statute restated the British position on abortion originally formulated in the Offences Against the Person Act 1861 which made an abortion a felony punishable by life imprisonment. The Infant Life (Preservation) Act 1929 had amended the 1861 Act to provide that the abortion would not be regarded as a felony if the Act were carried out in good faith for the sole purpose of saving the mother's life. This exception was expanded by common law interpretation in the 1938 case of R. V. Bourne in which a physician illegally performed an abortion upon a 14-year-old girl who became pregnant after being raped by two of the King's soldiers. The judge in that case, Mr. Justice MacNaghten, loosely interpreted the exception for the life-saving necessity to include preservation of physical and mental health and thus Dr. Bourne was acquitted.
Abortion reform was achieved in the United States through constitutional adjudication in 1973. In Roe v. Wade the U.S. Supreme Court struck down state legislation prohibiting abortion under most circumstances and allowing only limited exceptions to these prohibitions. The Supreme Court decided the issue on due process grounds and, in a far-reaching opinion, held that States could not prohibit abortions at all during the first trimester of a pregnancy, could only restrict it to save the life of the mother during the second trimester, and could proscribe it almost entirely during the last trimester.
Many nations of the world have thus created changes in abortion regulations within the last two decades; indeed most have done so within the last few years.
The Hon. Members may wish to compare these developments in other countries with the evolution of the abortion law in Canada. Until 1969 the law in Canada relating to abortion had changed little since 1892, and generally provided that it was an indictable offence, for which one could be sentenced to imprisonment for life, to procure the miscarriage of any woman. In 1969 the Criminal Code was amended to provide an exception to the offence of procuring an abortion. It was

October 28, 1985
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not an offence if the abortion had been approved by the therapeutic abortion committee of an approved or accredited hospital. The ground for approving an abortion was that the continuation of the pregnancy would likely endanger the life and health of the mother, which in most cases is a rarity.
With modern technology such as imaging, created by ultrasound vibrations, new medical evidence has emerged. The evidence indicates that life occurs at conception. If such is the case, then any abortion which is performed is an attack on a human entity. Our charter, Section 15, protects all life. Thus if this entity is life we are actually contravening our laws as well as our morality.
Thus if this Bill, Mr. Speaker, were allowed to pass we would be violating the rights of a defenceless human being being protected by a mother's womb, whereas that individual would receive total protection if mechanical means such as incubators were used to afford it real protection.
As I have stated earlier, Mr. Speaker, the debate in Private Members' hour may touch on some of the issues and give us a better idea of what is involved. It is not the place to solve one of the most complex social issues facing Canada today. We must be sure that when we do move to change our laws on abortion that the defenceless of our society must and will be fully protected.


Bill Attewell: Mr. Speaker, I wish to speak against this Bill. The protection of the unborn is really of the utmost importance. As legislators we may deal with a number of financial Bills and other issues, but it is a Bill like this that really cause one to speak from conscience, speak from the heart on issues such as this.
I find in my own riding of Don Valley East, in talking to so many people, that they obviously are not of one mind on this issue. There are many pro choice people who have their own strong reasons for their view on this most important topic, and there are many pro life people. This topic arises at town hall meetings as well as at other meetings of all types, and I find that very few people are swayed by the logic and the reasons we have individually. They seem to have taken a point of view in most cases well thought our in terms of their own background and experience. But this is one of those issues that I do not believe can be answered by taking a poll. I think these issues are answered best by, as I said earlier, speaking from the heart, which requires a very personal decision.
In my own family we have four children ranging in ages from 18 to 26, two boys and two girls. We chose to adopt our fourth child when he was 11 months old. He is now over 18 years. My wife and I have often thought what might have happened to that life-he came from a disadvantaged family-if in 1967 abortion had been easily accessible. I do not think that young man would not be living today. I am simply sharing a personal experience. Mine is a moral and religious point of view from which I cannot be dissuaded. I have a strong conviction about how important life is.
On another personal note, if I may be permitted, just this last July my wife and I became grandparents for the first time. On July 18, a young boy, Kyle William Strolenberg, was brought into this world by our younger daughter. We saw the magic of life begin within hours. When we saw our grandchild, we were speechless and in wonderment over the creation of life that we witnessed. I know people do take a different point of view but I simply do not know how they can deny how early life starts and how that life can be snuffed out through the abortion process.
In all conscience, I do support abortion if a mother's life is in danger, but not otherwise. There are many Canadian families who would dearly love to adopt a child. This is a country rich in so many ways. In certain cases where, for financial or other reasons, children cannot be looked after by their natural families I am sure we can find homes for those children. We in Canada are a collective family that will look after such children.
Some of my colleagues have already mentioned the statistics. The statistics are of concern when one is reminded that in 1982 there were over 66,000 legal abortions. As my colleague said, statistics show that the number of women who are having second abortions and sometimes third abortions is increasing. Regarding second abortions, I am advised that the statistics have gone from 2,850 second abortions in 1974 to over 9,500 in the year 1982.
The abortion law as it appears in Section 251 of the Criminal Code does permit an abortion where a hospital abortion committee thinks the pregnancy threatens the mother's life or health. As I mentioned, I am very much in support of abortion in that one particular instance. However, I do think we need to study some problems that arise in that particular area. I am told that some places in Canada are not in a position to have a hospital review committee made reasonably accessible to the woman who may be seeking the committee's assistance. As the Hon. Member who introduced this Bill said, something like 75 per cent of abortions are performed by a relatively small number of hospitals. I cannot believe that we are making this service as fairly and justly as we should to all parts of the country. This is an area at which we should look.
An issue like abortion is not one at which we should look with reams and reams of statistical data or with intense medical advice. While we as legislators need to have all the facts available, the issue is one about which many people have a point of view that is well thought out and thought out with sensitivity. I have talked at length to men and women who represent both sides of this divisive issue, not only during the election campaign but since that time. I have not spoken to one person who has indicated that he or she held a particular point of view but, after intensive discussions, had been persuaded to change his or her mind. It seems that the die has already been cast regarding how people feel about this issue. It goes right back to family and church life and to how people's views, disciplines and beliefs in the freedom of life have been cast.
October 28, 1985

Adjournment Debate


LAW REFORM-IMPOSITION OF PRISON SENTENCES
[Stage Direction]
As I say, people are not about to be dissuaded from their points of view by various arguments. This makes the issue all the more difficult for us as legislators. It is not like when we are dealing with a money Bill and a person may not be well informed regarding its true impact and may change his or her mind after receiving information. The matter of abortion is a very personal decision for anyone who takes it seriously. It is a decision that is thought out from the heart. It very much reflects the way we ourselves have been reared. Therefore, we must take the matter very seriously.
I am not compelled to go along with the Hon. Member who has his own point of view on this matter, a point of view which is, I am sure, very close to his own principles. I must go on the record as stating that I cannot in any way, in all conscience, support this Bill.
I understand that my hon. colleague would like to say a few words on this matter. I will give him the opportunity to do so. I appreciate the chance I have had to say a few words.
The Acting Speaker (Mr. Gormley):: The Hon. Member for Edmonton-Strathcona (Mr. Kilgour), very briefly.


Mr. Kilgour:: Mr. Speaker, could you indicate how much time remains?


The Acting Speaker (Mr. Gormley):: One minute.


David Kilgour: Mr. Speaker, in the next 60 seconds, I would like to go on record with pride as being opposed to this Bill. I know the Hon. Member who has proposed this Bill quite well and I respect his sincerity on this issue as on other issues. However, for reasons that were indicated by the Hon. Member for Don Valley East (Mr. Attewell), the Hon. Member for London East (Mr. Jepson) and the Hon. Member for Willow-dale (Mr. Oostrom), I very much hope that the day does not come that a Bill of this nature is passed.
The purpose of the Bill, according to the explanatory note which I believe may have been drafted by the Hon. Member for Burnaby (Mr. Robinson), is basically to abolish therapeutic abortion committees and to allow qualified medical practitioners to perform abortions without having to obtain prior authorization from such committees. Are you indicating that my time is up, Mr. Speaker?


The Acting Speaker (Mr. Gormley):: Yes. Order. The time allotted for Private Members' Business has now expired.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Standing Order 46 deemed to have been moved.
['The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 11 a.m., pursuant to Standing Order 3(1).']
Mr. Alan Redway (York East):: Mr. Speaker, I am one of those who believe that for some time there has been a growing concern and a great dissatisfaction with the state of our criminal justice system. I suspect that in all likelihood, Mr. Speaker, you share that dissatisfaction and concern with me. It emanates from a fear on the part of many people about their own personal safety in their homes or on the streets. That fear is something which seems to have been with us for years and years, but something which I think is growing more and more prevalent these days. I find that this fear manifests itself in people asking what we are going to do about the Charter of Rights. They say that the Charter of Rights seems to be a greater protection for the criminals in society than it is for them. It also manifests itself in people saying that they want to see a return to capital punishment and to see it very quickly. Those are all quite legitimate comments because they stem from the concern that each of us shares about what is going on with the criminal justice system.
One of the things the House is going to be looking at again is the whole question of capital punishment. You will remember, Mr. Speaker, that we were promised a review of that issue during the current Session of this Parliament. However, at the same time there are other things that can change and improve the criminal justice system besides a review of the question of capital punishment. Some of those things, I am pleased to say, the Government has already accomplished.
As you know, Mr. Speaker, we have had changes in the Criminal Code since September 4 last year, including changes with respect to drinking and driving. There are changes now being dealt with in committee with respect to street prostitution and soliciting, and the whole question of mandatory release of people who are confined to penal institutions.
All of these things are good and will improve the system, but there are other changes as well which we have to look at. Some of those changes were put forward just about two weeks ago by the president of the Law Reform Commission of Canada in his submissions to a criminal justice conference. He called for drastic changes in our sentencing laws. He suggested that what we should be doing is eliminating many of our sentencing procedures. He called for the elimination of both minimum sentences and the provision for time off for good behaviour. He has also called for the elimination of the whole parole system.
All of those things seem very revolutionary and very drastic on the surface. Suggestions of eliminating the parole system comes as a shock, because the parole system seems to us to be something engrained in the whole criminal justice system. It seems to be a good thing, so why would we ever want to do away with it? However, Mr. Justice Linden pointed out in his paper that we have had the parole system in Canada for a great many years and it has not seemed to have solved any of the problems. He also points out that the whole idea of time off for good behaviour came about as a result of insufficient room in the prisons to keep people, so we had to get them out

October 28, 1985
Adjournment Debate
somehow. What we did was implement the idea of releasing these people earlier even though a judge had sentenced them to a longer term in prison.
Mr. Justice Linden also points out that the minimum sentencing provisions in our Criminal Code have been there since the last century. All of these things he suggests should be reviewed. In fact, he suggests that we throw them all out and start over again with a new procedure of sentencing which he refers to as a "bench-mark" sentencing system. He suggests we set up a committee or commission to establish average sentences for different crimes. Instead of the system we have now, we should make sure that the penalty fits the kind of crime which has been committed and of which the person has been convicted. This does not sound revolutionary to me, Mr. Speaker, it sounds like good common sense, particularly when it comes from someone who is as learned as Mr. Justice Linden, the president of the Law Reform Commission of Canada. I believe it is high time the Government began to consider these suggestions. I feel that if it did, that would restore a good deal of the faith and confidence people have lost in the whole criminal justice system.
I am sure you know, Mr. Speaker, as we all do, that the former Government set up the Canadian Sentencing Commission to look into this whole question of criminal sentencing. It received, I understand from the Solicitor General (Mr. Beatty), over a hundred different submissions, including those from Mr. Justice Linden, on how we should attack this whole area of sentencing. I understand that that commission is going to be making some recommendations, probably next year or the year after, and perhaps there will be some changes. However, it seems to me that this is an area in which the Government should be moving and moving quickly. It is only by tackling this problem and straightening it out that both the ordinary citizen and those who are convicted of crimes will know exactly where they stand and the people of this country will have their faith restored in the criminal justice system. I hope the Parliamentary Secretary will assure the House that the Government is going to tackle this problem, and in a big hurry so that we can restore the faith and confidence of the Canadian people in the Criminal justice system.


David Kilgour: Mr. Speaker, I thank the Hon. Member for his carefully considered and thoughtful remarks on a very important subject. As you know, Mr. Justice Linden made an important speech on sentencing in Toronto. The concept of bench-mark sentences, and I am speaking throughout on behalf of the Solicitor General (Mr. Beatty) who is unfortunately unable to be here tonight, should be of strong interest to the sentencing commission referred to by the Hon. Member. It might offer a viable solution to instances of sentencing disparity in Canada, of which there are many.
As well, Mr. Justice Linden's suggestion of creating a commission empowered to revise these bench-marks, according to factors such as prison populations, could have a great deal
of merit, particularly for a Solicitor General who is so concerned with rising prison populations. However, the Minister is of the view that the philosophy of "just desserts" on which Mr. Justice Linden bases his new system may not offer all the guarantees of justice that its American proponents promised. There remains serious questions whether the models have achieved the objective of sentence equalization and standardization.
In the criminal justice system we always seem to come back to the age old dilemma of chosing between the classical approach and the neoclassical approach. In the classical approach all citizens are considered equally responsible and punishable for the crimes they commit. The neoclassical approach, as both you and the Hon. Member know, Sir, insists that individual circumstances must be assessed in every case because the physical and social environment influence the level of criminal responsibility. The Solicitor General believes that neither philosophy is fully satisfactory and we remain in constant search for a balance.
In that connection the Minister is not as certain as Mr. Justice Linden that "good time" and parole should be abolished on the grounds that they contribute to the arbitrariness of the system. Those programs, rooted in Canadian correctional tradition, represent in the Minister's view a recognition that human beings change for the better and, unfortunately, sometimes for the worse. To be placed in a completely static situation where it is not possible to affect one's destiny would destroy all motivation to change for the better.
How far can we go in a complete rationalization of the system from the court's viewpoint? For example, would the security level be determined by the court? What about the granting of temporary absences and access to education? You are indicating my time is up, Mr. Speaker? In that case, I simply thank the Hon. Member again for his thoughtful comments.



Jean-Robert Gauthier: Mr. Speaker, the matter I would like to debate this evening relates to a question I asked last May 2 concerning my interest and the interest of my constituents in current negotiations between the Treasury Board and the unions representing public service employees, particularly on pensions. I wanted to know whether the Government, as announced and promised, would soon make public an agreement with the unions concerning the issue of pensions paid to federal employees.
To refresh memories, I will quote the comments made by the President of the Treasury Board in the House last April 17. They can be found on page 3818 of Hansard, under Routine Proceedings:
October 28, 1985

I am delighted to be able to announce to Hon. Members that the Government has reached an understanding with the Public Service unions on a number of issues that are important both to our employees and to the Treasury Board as the employer.
Following that statement, Mr. Speaker, I asked a question in the House on May 2. I quote my own words on page 4343 of Hansard:
Ever since the Minister announced what he calls the new era in labour management relations in the Public Service, I have been asking him in the House to table the memoranda that he has signed or negotiated with the Public Service unions. The Minister has persistently said no to my request. In fact, the documents have been leaked to the press. Public servants are quite concerned. Superannuates are very disturbed. Will the Minister table those documents today so that people can rest at ease, read them, and understand them clearly?
Well, Mr. Speaker, the Minister did table the documents. These are draft documents which were made public and which feature what is called the four major issues-the general agreements, the pension question, the dental plan question and, finally, the question of amendments to the Public Service Staff Relations Act.
This evening, Mr. Speaker, I only want to consider the pensions issue. I will get back to the other items at some other time.
On April 17, the Minister said in the House, and I will quote him again, because it is important to understand what the Minister is saying in the House. He said on April 17: "The Government has reached an understanding with the Public Service unions on the subject of a Public Service dental plan". "I have signed an agreement". That is clear. A little further, and I quote: "Agreement has been reached on improvements to the work force adjustment policy" and finally "the understanding reached", again, the understanding reached, "goes a long way toward fulfilling the promises we made last summer during the election campaign."
Mr. Speaker, all these quotes and comments may be found in Hansard at page 3818, under Routine Proceedings, Minister's Statements on Management-Union Relations. And every paragraph reads, "I have concluded . ..", "I am delighted to announce .."I have signed an agreement...", "An agreement has been reached. . "The understanding reached . ..", all of which leads one to believe that something has transpired and that some agreement has been reached.
However, today in the House, the Hon. Member for Ottawa-Carleton (Mr. Turner) asked the President of the Treasury Board (Mr. de Cotret) if he had anything new to announce about pensions, and especially about the pensions of those who are already retired. The Minister rose in the House and referred to an actuarial report, which had been received and considered, and said no more. He did add that he would like a few days to formulate his conclusions.
Now, Mr. Speaker, we know that the agreement with the union specifically provided an actuarial review to be done by the employer, that is Treasury Board and an actuarial review to be done by the unions. Those reviews were supposed to
Adjournment Debate
provide information on the pension plan, its financing and its conditions.
To this day, Mr. Speaker, we have not obtained, and 1 repeat, we have not obtained from the Minister the assurance that we would see during this session an end to his shilly-shallying with the union.
As recently as two weeks ago, I had the honour to attend a public meeting of the Public Service Alliance with the Hon. Member for Ottawa-Carleton (Mr. Turner) and with the Hon. Member for Ottawa-Centre (Mr. Cassidy). At that meeting, the pension issue was discussed at length. It is a present-day problem for public servants as well as for those who are retired because every once in a while they have the feeling that the Governments are peering at them, wanting to alter the rules of the game.
I would like the Minister and perhaps the Parliamentary Secretary to reassure us, and those concerned with this issue who deal with public servants, and tell us that the actuarial review will soon be made public. In this connection, I would like to refer the Hon. Members to a debate held in this House on April 17 when I directed a question to the Minister who answered as follows: "There are still some details to be drawn up and actuarial reviews to be completed." Well, they are completed and he said today he had them. They should be made public to be sure that it was useful to stir up the matter in order that justice be done.
I remember, Mr. Speaker, quite clearly, the famous debate on public service pensions, a debate which was rather acrid. I was then considered as a renegade because I had upheld the rights of the civil servants. I still maintain today that when one pays or contributes to a pension fund, the employer must keep his word. I hope that this Government in its actuarial studies will keep its word and its commitment and provide an equitable pension to civil servants which will give them no more but no less than what they are entitled to in that respect.


David Kilgour: Mr. Speaker, my friend the Hon. Member for Ottawa-Vanier (Mr. Gauthier) having spoken in French, I would have liked to answer him in French, especially since both of us formerly were members of the Committee on Official Languages. Unfortunately my notes were prepared in the other official language, and I will answer in English. [English]
My remarks on behalf of the President of the Treasury Board (Mr. de Cotret) are not intended to provide additional detail on the public service pension reform issues because these are to be worked out by the Minister in consultation with the advisory committee on the PSSA. I would simply like to clarify the arrangements with respect to the composition of the Board of Management as announced by the Minister last April.

October 28, 1985
Adjournment Debate
Let me begin by giving some background about why the Government has created the Board of Management and to outline some of the principles upon which it feels it should be founded. The Public Service Superannuation Act has, since its enactment in 1954, provided for an advisory committee to advise and assist the appropriate Minister on matters arising in connection with the administration of the Act. The Committee consists of six members appointed by the Governor in Council on the recommendation of the President of the Treasury Board and six members recommend after consultation with the National Joint Council of the Public Service of Canada. The committee has been consulted by successive Ministers on major policy issues over the years and has provided valuable advice, most of which has been accepted and implemented.
In recent years, this arrangement has become less than satisfactory from the plan members' point of view because the committee's role is restricted to the provision of advice and because the proceedings of the committee are confidential and cannot be debated publicly. In other words, the role of plan members in management of their pension plan has thus far been somewhat limited.
Our Government recognizes that public servants should be actively and directly involved in their pension arrangements. Therefore, we have agreed in principle with the representatives of public service unions that the pension plan will be placed under a system of joint management, which provides plan members with direct involvement in policy development and administration for the future.
The President of the Treasury Board has indicated in his statement to the House that a Board of Management will be established, consisting of an independent chairperson, with at least 12 representatives, representing in equal numbers the employer and plan members. There appears to have been some misunderstanding about the composition of the Board of Management and the role of pensioners in this proposal.
It is the Government's view that public service pensioners are certainly plan members and it was never intended that they be excluded from representation on the Board of Management. I believe that the employee associations share this view, as does the Advisory Committee on the Public Service Superannuation Act, which has suggested that the proposed board include a pensioner representative.
I understand that a representative of the Federal Superannuates National Association already attends meetings of the present Advisory Committee and, therefore, already has a say in the application of all the reform proposals, including the operation of the Board of Management.
In conclusion, retired public servants can be assured that they will indeed be represented on the proposed new management board with direct involvement in public service pension policy development and administration in the future.


SOCIAL SECURITY-COALITION OF WOMEN FOR FAMILY ALLOWANCES (A) GOVERNMENT POSITION. (B) ELECTION DEBATE
Lynn McDonald: Mr. Speaker, tonight we are dealing mainly with the issue of family allowances. On October 2, 1985, I directed a question to the Right Hon. Prime Minister (Mr. Mulroney) concerning social programs. I quoted from the statement he had made during the women's debate in the 1984 election campaign.
At that time, the Prime Minister assured Canadian women of his support to the principle of social programs, and I quote:
Yes, I can give the insurance that no social program at all affecting anyone in need shall be touched.
But that promise he did not keep. The de-indexing of family allowances is prejudicial to all Canadian families, including the most in need. The de-indexing of the tax child credit will reduce the income of less privileged families in Canada. Single parent families will lose Government help, contrary to what the Prime Minister has promised.
Canadian women are opposed to the Government's deindexing plan. Quebec women in particular are organizing against it. A coalition of Quebec women for family allowances has been recently established. That coalition brings together more than 50 organizations representing more than one million Quebec women.
When the Prime Minister attempts to gain women's support for his program, he is wrong because women are beginning to understand what the Government has in mind. They realize that it will indeed increase the child tax credit, temporarily ... They know however that even the tax child credit will be reduced as of 1989. Deindexing results in a loss of purchasing power. That is what we must fight. Within 20 years, the baby bonus will be reduced, in real terms, to half its present value. It is almost the same for the child tax credit. Today, a poor family with two children gets $1,578 from the federal government under both the Family Allowance and the Child Tax Credit plans. That family does not get any exemption for child care like those who are better off. In 20 years, that poor family without any employment income will only get $973 a year in Government assistance. In addition, the taxes it has to pay will be substantially increased. As of 1990, the poor family will get less support from the federal Government than it does at present.
Women are appearing before the Legislative Committee on Family Allowances to make representations against this deindexing of family allowances. Those representatives have asked us among other things to increase family allowances. They have made it clear that the baby bonus is used for basic needs, to buy food and clothing for the children. The nurses' representatives have emphasized the hazard to the health of young children. One million children are living in poverty in Canada
October 28, 1985

and this figure is a shame in a country endowed with so many resources; it is outrageous!
The Government's priorities are unacceptable. We must maintain and even increase our child support programs.
We must recognize the contribution made by mothers and that is the purpose of the family allowance program, which is the only one of its kind.

Women are coming to Parliament and they are saying firmly that they do not want this deindexing. They want the Prime Minister (Mr. Mulroney) to keep the promises he made in the election campaign and, indeed, to give more support to families, especially to poor families. It is our duty to respond to those needs and to respond decently and generously. I call on the Government to do that.


Mrs. Gabrielle Bertrand (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, it should be emphasized that family allowances will continue to be paid in respect of all dependent children under 18 years of age. The universal nature of this program remains unchanged. However, the indexing formula for these benefits will be amended. Therefore, effective January 1, 1986, family allowances will be indexed only if the yearly cost of living increase exceeds 3 per
Adjournment Debate
cent. The portion of the increase over and above 3 per cent will be fully compensated.

It is also important to emphasize that assistance for low-income families will increase over the next three years. While it is true that their family allowances will be subject to the same indexing provisions as those of higher-income families, it is also true that low-income families will be more than compensated. Thus, the maximum child tax credit payable to low-income families will be increased by $140 per child over the next three years.

Moreover, in order to share more equitably our limited resources, the child tax exemption in respect of dependent children will be reduced until it equals the yearly family allowance payments. The House is aware that this exemption was blamed on many occasions for being regressive, because it benefited more high income families than low income families.
In short, Mr. Speaker, the Government is streamlining the child benefits system and making it more progressive.


The Acting Speaker (Mr. Darling):: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 11 a.m., pursuant to Standing Order 3(1).


[Stage Direction]
The House adjourned at 7.27 p.m.
[Stage Direction]
3
[Stage Direction]
Tuesday, October 29, 1985