1985-11-25

Mr. Alain Tardif (Richmond-Wolfe) moved:: That this House regrets that the Prime Minister has once again broken an election campaign promise, this time by failing to maintain quotas on imports of shoes and by compounding this betrayal by failing to make adequate provision for the thousands of workers whose jobs are adversely affected.
He said: Mr. Speaker, I welcome this opportunity to put this very important issue before the House of Commons, today on Monday, November 25, 1985, a few days after hearing an announcement that has practically lifted all quotas from shoe imports.
As the motion indicates, the Prime Minister went to the Eastern Townships in May 1984. We must understand that textiles, clothing and footwear are extremely important industries that are very job intensive and absolutely essential to the economy of the Eastern Townships.
Last week, when the decision was known, certain people close to the Prime Minister claimed that Mr. Mulroney had never made a commitment and that the Prime Minister had never promised he would maintain or extend the quotas. Therefore, with your leave, Mr. Speaker, I would like to refer to a document which I find very significant, very interesting and very revealing, concerning the announcement or commitment made by the Prime Minister at the time. I am going to quote from a newspaper article reporting on that commitment, and it says: "A Conservative Government would not lift import quotas set by this country with respect to footwear, textiles and clothing". The quota policy would remain as such, said Mr. Mulroney, who stated he was not in favour of free trade in these particular sectors. He added that he would not alter his position, despite possible pressures from Common Market countries and the United States to reduce quotas on footwear and textile products imported into Canada. He added: I will certainly say so to President Reagan when I meet him in Washington next month. I will see to it that our interests are protected at all times. Friendships like ours are worth something, he said. Neighbours like us are worth a lot, maintained the Conservative Leader.
Mr. Speaker, today, although there might be a case for saying that Mr. Mulroney, the Prime Minister, did not make a firm commitment specifically concerning the footwear industry and did not make a firm commitment on the issue of extending quotas, if we put his commitments and his statements in their proper context, bearing in mind that the footwear industry is a very important sector in the Eastern Townships, I do not think there can be any ambiguity or confusion: this was indeed a very formal commitment.
Therefore, Mr. Speaker, as indicated in the motion, we are still faced with a very serious situation where this Government has literally betrayed the trust it received from Canadian men and women on September 4, and it has done so in an area where the consequences will indeed be disastrous.
According to the most optimistic figures given last week by the Manufacturers' Association, in the very near future only about 4,000 out of 20,000 jobs in the footwear industry will be left. What is extremely discouraging and disheartening, along with the catastrophic reduction in the number of jobs in the footwear industry, is the fact that in a great many cases, these industries cannot expect to obtain any kind of substitution or solution or remedy, since most are located in areas away from the large urban centres, areas where it is extremely difficult and problematic to interest investors in investing in replacement industries, to make up for the jobs lost in the footwear sector.
Mr. Speaker, this forecast for the footwear industry seems much closer to reality than what the Government appears to be saying. We must understand that the previous Government set these quotas, which were renewed for three years at a time, and when this Government came to power, the quotas were to continue until the end of May, 1986. One of this Government's first decisions was to shorten very significantly the deadline for the quotas by making them end on November 30 of this year, which is this week.
The study used by the Government in making its decision, the anti-dumping report, was released last June. Therefore the antidumping report conclusions were known as early as last June. So why did the Government wait until the penultimate week of November to make its position public? Respectfully, Mr. Speaker, we maintain that its mind was set, that the decision had long since been made, but it waited until the last minute in the hope that consumers, workers and the industry
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November 25, 1985
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would not raise too much of a fuss about this totally catastrophic conclusion.
Government Members have two explanations to justify their decision. First they tell us that the most sweeping and comprehensive study in this Field does recommend the outright abolition of quotas. That is their main argument, their first excuse to do away with quotas. Then they go on to maintain that, over the last eight years, Canadians have paid the astronomical amount of $400 million to $500 million more than it would have cost them had quotas not been in force.
In my estimation, Mr. Speaker, both arguments can easily be demolished in either case. First, concerning the antidumping report, the reader will be amazed at the findings if only he goes to the trouble of reading it very carefully page after page. I would even say that its conclusion flies in the face of logic with respect to the main thrust of the report. The best way to substantiate my views on the famous antidumping report is to quote parts of it.
This can be found on page 132: "If unrestricted and quota imports are added up, it becomes obvious that over-all imports soared by 10 million pairs since 1980, an increase of 23 per cent." One has to admit that imports rose considerably between 1980 and 1984 when they were subject to quotas. It being so, how can anybody conclude that imports will not go up if they are not restricted? To me that is a rather illogical statement.
Here is another passage of the antidumping report, from page 49 this time: "Since direct imports enable retailers to avoid paying the importer's margin, in all likelihood they would boost both their volume and share of imports if there were no quotas." Here again it does not quite jibe with the Government position.
A further quotation: "Net Government receipts would be higher after the removal of quotas, mainly as a result of more tariff levies due to rising imports."
One last extract from page 62 of the famous antidumping report goes like this: "It can be expected that quota removal- immediate, total, partial or gradual-will spur imports, and manufacturers might well decide to become importers since the different economic climate would pave the way for a new market approach".
Mr. Speaker, I could go on like this for half an hour or three quarters of an hour, quoting and repeating statements and findings which abound in the antidumping report, finally to conclude that they openly contradict the logical arguments from which they are derived. It seems to me this would have been a good reason for the Government to reject this study, for indeed it would not have been the first time a Government had turned down a study however complete and exhaustive it might have been. The interest of workers and their jobs was the issue,
but the Government is hiding behind what is clearly an unacceptable report.
They do not hesitate to pick out only those parts of the report which seem to strengthen their case, going as far as to stress the second argument to the effect that consumers have shelled out $400 million to $500 million simply because of the quotas.
The anti-dumping report-and I think that the government should be honest enough to recognize it-mentions that this assessment is not at all scientific and is based solely on studies which have every chance not to be valid, and that it is an affirmation based on an approximation. On the one hand, there is nothing final, specific or especially scientific about this assessment.
On the other hand, let me tell you that according to a study or analysis made by an organization representing thousands of people in order to refute this argument, there will be some $3 billion in social cost over the next eight years following the Government's announcement. Canadian men and women will pay as much as $3 billion in unemployment insurance and welfare benefits over the next eight years following the measure which was announced last week and which will result in the very short run in a loss of several thousand jobs.
Mr. Speaker, there is another reason, as basic as the first for which I feel that the decision announced last week will not benefit consumers or serve their best interest.
One need only visit shopping centres to realize that almost everywhere people use Canadian products, Canadian footwear as points of reference.
1 am sure that my hon. colleagues opposite have had that experience too: a pair of Canadian shoes is offered at a price of, say, $79.95. Right beside it is a pair of imported shoes with a price of $69.95. Consumers are therefore attracted by the imported product which is $10 cheaper than the Canadian product. I suggest that people who are not well informed will not see much difference between these two products. The Canadian man or woman who chooses the imported pair of shoes will feel he or she has saved $10.
However, what one should know, Mr. Speaker, is that the retailer who is asking $80 for the Canadian product paid approximately $40 for it. On the other hand, he is asking $69 for the imported product for which he has paid $15 or $16. The retailer, therefore, will do everything to try and convince consumers to choose imported goods.
Mr. Speaker, you certainly realize that, so far, the Canadian consumer in my example is clearly ahead, for he has saved $10. But what about the respecting quality of the two pairs of shoes? I suggest that the Canadian product is of much better quality than the imported product. I also feel that getting rid of this point of reference would be extremely dangerous, for as
November 25, 1985

soon as retailers will no longer use Canadian products for comparison, consumers will have to pay the price, and a very high one at that.
There is another angle to this situation. I would ask my Hon. colleagues of the fair sex to visit chain stores and to go shopping for a pair of women shoes. You will find out it is extremely difficult, extremely painful. Salespeople will even tell you that Canadian products have no style, that they do not keep up with the latest fashion. They will invoke all kinds of arguments that are simply not relevant. Only someone who does not know anything about that field could make such statements. The products we make here in Canada are equal or superior in quality to what the import market has to offer, and there is only one reason we cannot find Canadian women's shoes in the stores. It is purely and simply because the retailer does not get a mark-up comparable to the one he gets on imported shoes. It is due exclusively to the fact that on shoes made in Canada, his mark-up or profit margin is only 50 per cent while it is much lower on imported shoes.
On the other hand, we must also understand that this is a very special sector where retailing is virtually under the control of a few big companies. Independent retailers, even though they number more than 4,000 in Canada, did not have a say in that matter nor any chance of expressing their opinions and even at that level, the decision the Government announced last week will prove disastrous. We will see small independent retailers close their business in the next few months and weeks. They will be replaced by the big chains that import and control the retail market, and believe me, their main objective is not the interest of the consumers, but their own profit, first and foremost the improvement of their businesses' viability, at the expense of the ordinary consumer.
So, Mr. Speaker, this is a disastrous decision. On the other hand the only alternative indicated in the Minister's statement where three aspects of an already existing program are mentioned in a solution which is already available to my riding. I come from an asbestos-producing areas and in view of the difficult times experienced by the asbestos two or three years ago, we became a designated area which is to all practical purposes what the Minister is now offering the workers in the shoe industry. In conclusion I can tell you, Mr. Speaker, that those measures have not changed the situation a iota nor resulted in any permanent job creation because the problem is due to an economic slowdown in the asbestos sector. Now this is the alternative which is being offered to the Canadian industry shoe workers.
Mr. Speaker, as we shall learn about the closing of one or more plants in the months ahead, I hope that the Government, in all fairness will reverse its decision, and will come up with one based on the interests not of the importers but of the
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workers, male and female, from Quebec, Ontario and any shoe manufacturing area in Canada.


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


Mr. Hudon:: Mr. Speaker, I listened very carefully while the Hon. Member was speaking about this issue, and 1 believe that if he is so deeply concerned, it is because of the geographic location of his constituency. In his motion, he mentions an election campaign promise. I would like him to tell me what promise or what commitment the Liberal Party made regarding footwear import quotas during the campaign and where 1 can find it because, when I was preparing my intervention for today this week-end, I tried to find the commitment of the Liberal Party as concerns footwear quotas and I found nothing. I was trying to explain . . . May I continue with my question? I was trying to explain why, very often, Governments have a tendency to do such a thing as referring the issue to a tribunal when a difficult decision has to be made, and I would like to point out in passing that newspaper reports are generally quite favourable to this decision because the medias believe that it shows courage. We then have to ask this question: What was the commitment of the Liberal Party as regards footwear quotas during the last election campaign? I would like to know.


Alain Tardif: I would like to thank the Hon. Member opposite for his interesting question. I shall simply tell him that the quotas were established, maintained and reinstated under the Liberal Government on the one hand. On the other, and I invite the Hon. Member to listen carefully to what I will tell him, when the quotas were about to be lifted the last time, the Government was under the same pressures as you were. The difference was, Mr. Speaker, that this political party, and I am speaking of course about the Liberal Party, included men and women who had the courage to protest strongly against the decision made by Cabinet at the time and to say: "If you put this forward, we shall not support it." This is easy to verify: it is on the public record. If you are in the least interested in this issue, you can check these facts by simply asking for the documents. You will then see that the Government reversed its decision and re-established the quotas for the industry. Moreover, I would like to remind you that there had been a demonstration on Parliament Hill involving 5,500 workers from Ontario and Quebec, as well as four Liberal Members of Parliament, even though their party was in power at the time. The demonstrations included myself and three of my colleagues, and even some of your own colleagues. Some of your colleagues were even saying at the time: "If the country had a Progressive Conservative Government, you would have not only quotas, but also a clear and precise policy. There would not be such loopholes as now exist under your Government."

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1 recognize that the previous Government established quotas. I recognize that these quotas were not perfect and that the situation was not what it should have been because of certain loopholes. As for you, you are getting rid of the quotas, and as for the few that remain their effectiveness is still limited by an obvious loophole, as big as the House of Commons. Here is a very simple example of what I mean: You say that girls' and women's footwear are subject to quotas. What about unisex footwear? It will naturally be classified under boys' or men's footwear and will evade the quotas. These quotas are therefore of no value and no interest to the manufacturers.
Mr. Speaker, in closing, I would like to invite those of you who are concerned about the shoe industry to do what we did ourselves and to oppose your Government if you want to protect the jobs in this industry.


Mr. Langdon:: Mr. Speaker, I have a question on the same subject. We made, I believe, three main mistakes in the Canadian strategy regarding the shoe industry.
The first one was the removal, by the Liberal Government, of quotas on leather shoes between November 30, 1981 and July 9, 1982. Imports increased dramatically during that period.
The second, Mr. Speaker, mentioned in the report itself, is that before 1981 there was no restructuring in that industry. That is what the report says. It means that after four years of quotas, there has been no change whatsoever. Modernization, which should be at the centre of any effective strategy in this industry, did not take place.
The third mistake-and this is also mentioned in the report, I believe-is that the quota system set up after 1982 was too weak. We find that in the report. As a consequence, had a high level of imports despite the quotas. Given all these mistakes and difficulties, is it possible for a Liberal Member to say that it is a Conservative rather than a Liberal problem?


Alain Tardif: This is a good question, Mr. Speaker, as it gives me the opportunity to make a short comment. New Democrats can say whatever they want because they will never be more than fifteen or twenty. But the answer to the question of the Hon. Member is yes.
Shoe manufacturers, Mr. Speaker, want 50 per cent of consumption. However, statistics show that they have, at this very moment, only 40 per cent, and the Government wants to reduce their share to 9 to 12 per cent. This is what is offered to the manufacturers. Under the Liberal Government they had between 48 and 40 per cent of consumption. It is a whole lot more than what is being offered to them now. Nobody is perfect. Personally, I would have preferred a 50 per cent share for a period of five years. Nevertheless, they had 40 per cent and they are now given only 10 per cent.


Hon. Edward Broadbent (Oshawa):: Mr. Speaker, the decision to abolish quotas in the shoe industry made by the Minister last Wednesday is a perfect symbol of everything which is wrong with the present Government. On the one hand, it reveals the insincerity of the Government in terms of promises which were made during the election campaign and, on the other hand, it reveals its insensitivity to Canada's working families. Finally, and perhaps ultimately most significantly, it reveals the incompetence of the Government when it comes to important economic decisions. I would like to comment on all three of these matters.

Mr. Speaker, this Government is not taking its promises seriously. On the contrary it makes no bones about breaking them. In Sherbrooke, last year, Mr. Mulroney, then Leader of the Opposition, had promised that a Tory Government would maintain quotas on footwear imports, that he would not give in despite pressures from the EEC and the United States. Mr. Mulroney had then understood that a committee set up by the Liberals could suggest the removal of quotas, but in spite of the promises made in Sherbrooke, in spite of a promise as a new Government, the Prime Minister is implementing the recommendations of the Liberal committee. In reaching such a decision, he has deceived Canadians, he has betrayed the workers in the Canadian footwear industry.

In sector after sector, promises made in a particular part of Canada to a particular group of Canadian workers during the election campaign, are now being broken. The most relevant and recent example is, of course, what we are debating here today, the promise made to men and women working in the shoe industry and related industries that quotas would be maintained. This promise, it appears, was rather cynically given before the election and cynically ignored afterwards.
I want to say, Mr. Speaker, that my Party takes election promises seriously.


Some Hon. Members:: Oh, oh!


John Edward Broadbent: I see the snickering Tory to the left- physically in the House, of course-because his Party obviously does not take its promises seriously. I say to the Tories opposite, because they often like to accuse us of being big spenders, that I am proud to say that the New Democratic Party in 1984, in terms of the costs of its programs which were published before the election, probably came in at the lowest cost of all three Parties. We took care in what we had to say and I just wish that the Prime Minister of Canada (Mr. Mulroney) had taken care in what he had to say in 1984 and had carried it out in 1985.
I do not want to dwell on that particular point, but it is something I take very seriously indeed. If we are going to encourage constructive thinking about politics, if we are going to have serious debates on the future of our nation, politicians have an obligation to mean what they say, to say what they
November 25, 1985

mean, and if they are elected, to carry out what they promise the people of Canada.
1 would like to turn to another aspect of this question of the performance of the Government which is revealed in this latest decision.

Such a decision shows insensitivity towards laid-off workers. According to the Shoe Manufacturers' Association of Canada and unions operating in that sector, the removal of quotas on shoes will result in the closure of many factories and ultimately in massive lay-offs. Mention has been made of the loss of some 10,000 jobs, 8,000 of which would be in Quebec and probably 5,000 or so in the Montreal area.
In addition to jobs directly related to the manufacture of footwear, the same percentage of jobs, that is 50 per cent, are also threatened in the related industries of tanning and supplies. The manpower in that sector recognized for its great stability is very concerned. Having worked during their lifetime in that sector, workers are worried because they may find it very difficult to find other jobs. They are right.
We should consider also the effects on the communities. For twenty years or so, the factories producing footwear and soles have left cities to relocate in smaller towns in Quebec as well as in other provinces. If those factories have to close, increased unemployment in those communities will reduce the purchasing power of residents which will directly affect the economy of those communities.
In short, we are forsaking that industry, those towns and those workers.
The report contains a little noted comment which I want to stress today. The Minister has not alluded to this very much since he made his decision. The report says: "The upheavals caused will certainly be significant for the industry and the workers affected". The people who made this report were well aware of the consequences for the men and women in the industry.
The decision is not only insensitive to workers in the communities affected, it is also economically foolish. The simplicity and insensitivity of the Government, I regret to say, is equal only to the simplicity and insensitivity of the commentators who have discussed the Government's decision. A frequently stated, sometimes unstated, assumption about the economic process we are now going through-and it directly pertains to this particular decision-is that the Government of Canada must come down, on the one hand, for completely free trade and, on the other, for some kind of permanent quota system. There seem to be, in this Government's mind as in that of previous Governments, Liberal and Conservative alike, only two industrial options. There is the passive industrial option which sees the future of Canada hiding behind high tariff barriers. That, more or less, has been tried in this country in
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the past. The other passive industrial option that this Government seems to be aiming towards is the removal of all barriers, to throw open our country to the winds, to use a delightful euphemism, which prevail in the world economy. I want to stress that both those options are essentially passive in nature. However, in my judgment, no nation in history has come to a position of significant economic prowess by following either of those options, not in the ancient world nor in the modern world. I say to the Minister that these two options are not the only ones open to Canada. There is a third option.
The Government of Canada can play an active, constructive, and imaginative role on a sector by sector basis with the private sector. Together they can work out a strategy for this country in its approach to the world economy which rejects the dual forms of passivity involved in hiding behind a protective mechanism for an indefinite period of time, or throwing caution to the winds and throwing open the doors to the forces of the world economy.
This decision illustrates the Government's tendency to head towards free trade, not having thought out the consequences. The Minister is right when he says, as he does, that the quotas have not really worked. We have had them in place for eight years and the Government's view is that if the quotas were going to work, they ought to have worked by now. Some facts are very pertinent to this argument. First of all, as the Minister knows, some $17 million was allocated under CIRB to this industry. He also knows that during the quota period a very small percentage of the money allocated for modernization has actually been used. In fact, if I remember correctly, only $2.2 million has been used. Therefore, the point is that the modernization process has just begun. Only a small percentage of the money has been used in the way it was intended to be used. However, what does the Government do when it is faced with this reality? It throws up its hands and says, "We have tried, it has not worked, so we will just stop the whole thing and throw the economy-that is these workers we are talking about, men and women and their families as well as their communities, I remind the Minister-to the whims of the market." This is a classic example of what the Liberals have done historically in this country.


Some Hon. Members:: Oh, oh!


John Edward Broadbent: I welcome the participation of the Conservatives and Liberals in this debate.


Mr. Foster:: We started it.


John Edward Broadbent: You started it, I agree. I say to my Liberal colleagues on my right that I want them to join in the debate. I know they moved the motion. I want them to talk about the issues. The reason I say that we have a typical Liberal solution here is that the Liberals historically threw money at a problem for a number of years and then, if it did not resolve the problem, they went on and did something else instead of trying to make it work. The key point I want to make is that instead of abandoning the program when we know a majority of the firms have just started to carry out the required moderniza-

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tion, we should be encouraging the completion of this process. The Minister knows and the report shows that these firms are now spending the money allocated for modernization. If we do not encourage the completion of this process, we will just be wasting the money which has been spent so far. Beyond that, most significantly, we will be wasting the lives of the men and women who are going to be losing their jobs. We do not think that makes economic or social sense.
1 cannot put too much emphasis on this point. We had in place a good model of industrial planning which ought to be applied to other sectors. I agree that the firms involved did not respond quickly enough over the past eight years. But, by God, we had begun to see a different approach in other industrial countries-Japan sure as hell, to put it bluntly, would not have thrown its workers out on the street. It would not have just abandoned money like this. We had a good process. The industry was slow in responding but it is doing so now and we should be completing the process to keep those jobs and make this industry competitive in the modern world. The option is really not the kind that the Minister and the Government want to give us. In the near future we want to have quotas in this industry abolished. We want to have the industrial modernization process which was started with this program carried through. Instead of doing that, the Minister is simply abandoning a good idea. In the traditional Liberal way he has thrown some money at it and when that did not produce results in the short run he has stopped it entirely. That is not good planning at all.
I will give one other example of the incompetence that is illustrated by this decision. I regret to say that it is my view that the decision of the Minister and the Government on this issue was shaped simply because of a failure to believe in industrial planning in a mixed economy which plays an important role. The other key factor was the process that is under way for negotiations with the United States on free trade. We are doing all the wrong things. One day we give up Canadian content in the automotive sector, losing Canadian jobs in the process because it does not seem to be compatible with the American model of a comprehensive free trade agreement. Another day we sacrifice Canadian shoeworkers on the altar of the wonderful free trade market. All of this fits into the American strategy but does not fit at all into the Canadian strategy.
While we are busy sacrificing sectors of Canadian workers, significant American figures are talking about getting a resolution of certain bilateral issues such as the importation of logs, pork, and so on. Before the talks commence in a serious way they would like to get the issues resolved. The Conservative Government is busy giving up the interests of Canadian workers in advance. All I can say is that this is no way to conduct major negotiations which go to the heart of the future of the country.
I conclude, Mr. Speaker, by saying that the decision taken last Wednesday was bad in both the short run and the long run
for Canadian workers in the shoe industry. It was bad for what it says about the Government's view of industrial planning and bad in terms of revealing its attitude toward negotiations with the United States.


Some Hon. Members:: Hear, hear!


Mr. Dorin:: Mr. Speaker, I would like to ask a question of the Leader of the New Democratic Party (Mr. Broadbent). Does he have any concern for the consumers who have paid roughly $500 million because of these tariffs and would continue to pay that amount of money in the future?


John Edward Broadbent: Mr. Speaker, of course I have concern for the consumers. If the Member reads the report, as he has perhaps already done, he will notice that the report itself says that the Canadian producers did not increase their prices during the period of the quotas. Therefore, there certainly was not an increase in prices paid, which had a negotiative effect on consumers during this period.
It seems very clear to us in the New Democratic Party that in approaching the economy of Canada one has to look at it in terms of broad concerns, consumer concerns, worker concerns, employment concerns and community concerns. When we address that issue we are prepared to say that there may be some costs to a consumer in any part of Canada to maintain industry in the country. There are only one or two raw materials that we could not get cheaper elsewhere in the world. However, we made a decision a long time ago that a country is about creating opportunity for men and women to work and that is our priority.


Hon. James Kelleher (Minister for International Trade):: Mr. Speaker, I am frankly amazed at what I have been hearing from the Opposition spokesmen on footwear. I am amazed and I am disappointed.


Mr. Boudria:: How do you think we feel?


James Francis Kelleher: There seems to be a knee-jerk response on the other side to every positive action the Government takes. If we are for it, they are automatically against it, even if what we are doing was their policy when they were in office.


Mr. Riis:: What about your minimum tax proposal?


James Francis Kelleher: Is this responsible opposition? I suggest it is not. Is this in the interest of the Canadian people? I suggest it is not. Is this the desperate attempt to grab headlines for their narrow, partisan interest? Now we are getting closer to the truth. They are suffering from footwear and mouth disease.


Don Boudria: Who wrote that?


Mr. Hees:: He wrote it himself.


Mr. Keeper:: Take the boot out of your mouth.


Mr. Kilgour:: We listened to Ed without heckling.


Mr. Speaker:: Order, please. Order, please!
November 25, 1985


James Francis Kelleher: Mr. Speaker, as I have listened to the debate on footwear over the past few days in this House two things have struck me: The opportunism of the Opposition, an opportunism extending to cynicism, and the lack of sensitivity of the Opposition. It is out of touch with Canadian consumers and Canadian life. Of course, that is nothing new. The other day the Hon. Member for Winnipeg-Fort Garry (Mr. Axworthy) accused the Government of practising "abstract economic theology". The Government practices nothing of the kind. We deal in economic realities.


Don Boudria: That is a euphemism for selling out.


James Francis Kelleher: In this case we are dealing with a 223-page report by the Canadian Import Tribunal which heard 72 witnesses and received 39 written submissions. After the report came out we consulted on its findings with all parties concerned. Abstract economic theory is not our bag. That is what the previous Government practised from its oracle on "Mount Saint Elsewhere". What was the NEP but abstract theory? What was FIRA?
Of course, theory is not involved in the attacks that my hon. friends in the Opposition have been making on the Government's footwear policy. Here they have been forced to resort to smoke and mirrors and to plain political opportunism. Take the charge made by the Right Hon. Leader of the Opposition (Mr. Turner) that the Prime Minister (Mr. Mulroney) has broken an election promise made on May 4, 1984. Let us look at the facts.
On May 4 of last year the Liberals were in the middle of their leadership campaign. On May 4 elections were nowhere in sight.


Some Hon. Members:: Oh, oh!


James Francis Kelleher: To continue the chronology, it was not until several weeks later, on June 14 of 1984, that the former Government called on the Canadian Import Tribunal to examine the state of the footwear industry and report its findings within one year. It was not until July 9 that the Right Hon. Leader of the Opposition, having just been sworn in as Prime Minister of Canada, dissolved Parliament-which he could not sit in anyway-and called the election that put the Government in office with the largest majority in the history of Canada.


Some Hon. Members:: Hear, hear!


James Francis Kelleher: Now we skip nearly a year. On June 14 of this year the Canadian Import Tribunal, having conducted the most thorough study of the footwear industry ever carried out by any inquiring body, handed down its report. After a full year of study it found that most of the footwear industry no longer needed the protection of import quotas. Indeed, it could no longer benefit from quotas.
Had the tribunal found that import quotas were still desirable, I can assure you that the Government would have
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followed its recommendations and left them in force. That, incidentally, is more than what the previous Government did. In an earlier inquiry into footwear, the tribunal ruled in February, 1981, that the removal of quotas would be harmful to the Canadian footwear industry. Despite this finding, the then Government, in its wisdom, took the quotas off and then had to restore them in a few months. This was the Government that now sits as the Opposition, for very good reason, and whose international trade critic stood up the other day to accuse us-in his entirely unparliamentary word, as recorded on page 8637 of Hansard-of "treason".
By now Canadians are aware that what we have done on footwear is to put into force the recommendations of the Canadian Import Tribunal, a tribunal established and appointed by the previous Government. I would point out that its studies of the footwear industry were exhaustive and that its recommendations were specific and clear. Under the circumstances, I find it extremely difficult to understand how the Liberal Party can adopt a position of opposition on this measure. I suspect some of its own Members may be as confused by its stance as I am.
In light of the fact that the tribunal found that four of the five categories of footwear producers are now able to stand up to foreign competition, is it the Liberal Party's position that we should ignore the tribunal's recommendations and continue quotas that have cost the consumers of Canada up to half a billion dollars in the past eight years? Is that what the Opposition is saying?
I am also surprised by the stance taken by speakers representing the New Democratic Party. This is the Party that says it represents the "little guy". It is the "little guy" who will benefit most from the removal of quotas. Their shoes will cost less and they will find a greater selection to choose from, particularly a greater selection of lower cost footwear because the quotas had the effect of keeping out lower cost shoes.
Perhaps it is the confusion of the two opposition Parties that has led their members to be so intricate and selective in their attacks on the Government's footwear policy. Whatever the cause, their selectivity has been exquisite. I know that they have read the tribunal's report, because they keep citing it with what sounds like approval. However, what they pick out are brief passages-a sentence here, a phrase there-that, taken out of context, would make it appear that the tribunal agreed with them. It did not.
Let me cite one example of this superselectivity. The other day the Hon. Member for Essex-Windsor (Mr. Langdon) cited a passage from the tribunal's conclusions to support his concern for the workers in the footwear industry. I certainly do not object to the Hon. Member being concerned, as I too am always concerned for workers in the industry. However, the passage that he cited was a sentence in the middle of page 57. It reads as follows:
The producers who have been identified as particularly vulnerable are smaller producers located principally in Montreal, although smaller producers in Quebec outside Montreal and perhaps also in "Ontario" may equally be at risk.

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That is where he stopped. But let me read the next sentence in the report. It is as follows:
The distributions of employment by size of firm indicate that the number of workers represented by these producers is not large.
The next sentence reads:
The individual and social costs arising from loss of employment have been examined, and, in the case of Quebec, the net benefits to workers from leaving the industry are all positive.
Positive? How could that be? The tribunal offers some explanation in the Appendix section, which nobody of course has quoted. It points out that wages are low in the footwear industry, and that few workers stay at their jobs very long. Turnover is extremely high. It ranges from 56 per cent a year at the low end up to 230 per cent at the high. Two hundred and thirty per cent means that the average worker is on the job less than five months before he leaves.
In the tribunal's opinion, in other words, footwear workers taking advantage of Government programs to find new employment and upgrade their skills would be better off than they are now. That is what we intend to do for them.
The Opposition, of course, has ignored most of the tribunal's findings. It does not mention that the entire industry is still protected by 23 per cent tariffs on imported footwear, which is more than double the tariff in the United States and nearly triple that of western Europe. The Opposition cites only brief selected passages from the report, and only to try to add authority to its own curious case. I suggest that this is not proper opposition.
For the record, let me cite the tribunal's main findings. They start on page 56 of the report. The tribunal has concluded that certain sectors of the footwear industry, in the absence of special measures of protection-that is, quotas-are capable of competing successfully against imports, namely men's/boys', children's/infants', slippers/house footwear, special purpose footwear and skates. The tribunal has also concluded that women's/girls' footwear production remains vulnerable to injury from imports. The tribunal does not believe that the more vulnerable producers could expect to survive by virtue of a complex phase-out formula if they cannot compete in conditions created by a simple and straightforward process of lifting quota constraints. Accordingly, the tribunal proposes that the quotas allocations bearing upon the women's footwear sector be increased by 10 per cent per year in each of the next three years.
Hon. Members will appreciate that the Government gave the women's/girls' footwear producers, which account for roughly half of the industry's production value, more protection than the tribunal recommended. Instead of raising quotas 10 per cent a year, we are doing it more gradually, by 6 per cent the first year, 8 per cent in the second and 10 per cent in the third.
Let me stress that the Government is committed to preserving and creating jobs for Canadians. We are committed to doing this in the footwear sector and in all sectors of the economy. One of the most effective ways of creating jobs is by improving our trade performance. As I have reported to the
House, the Government is involved in a great many actions to do just that.
I suggest that the Opposition should be reminded that trade is a two-way street. We cannot expect other countries to buy our goods if we will not buy theirs. I would point out that the Opposition is carefully ignoring the fact that our trading partners are not at all happy at our decision to keep import quotas on ladies' and girls' shoes. The European Economic Community has already signalled its intention to invoke its own right to retaliate against another three years of quota by imposing restrictions on goods we export to them. I have already heard from some companies in industries that have nothing to do with footwear that they are afraid of losing their markets in Europe. If they do, they will have to lay off workers in turn.
We in Canada have been through this before. As I pointed out last week, at the time the present footwear quotas were extended to November, 1985, the European Economic Community threatened to retaliate. It threatened to raise tariffs to prohibitive levels on Canadian petrochemicals, steel products, kraft paper, furs and other products. This could have cost us $150 million a year in sales to Europe. Is the opposition saying that they are not concerned with the jobs of Canadians who work in these sectors? Do they really not care about steel workers and petrochemical workers, for example? The message is really very simple. If you provide too much protection for one industry, you will pay for it in others.


Some Hon. Members:: Hear, hear!


James Francis Kelleher: This is a message that the Opposition does not seem to understand, but it is a fact of life. The Opposition, however, is having trouble relating to the everyday life of Canada or to the aspirations of Canadians. On this footwear issue, the Opposition has become irrelevant to Canada. It is, to put it in footwear terms, out on a limb.
The nation's press keeps up, however, and for the edification of some members of the Opposition, let me quote what some of the newspapers are reporting.
In Montreal, a La Presse editorial of November 21 read:
Ottawa has finally decided to save the Canadian footwear industry. Import quotas had created an unreal world in which the Canadian producer somehow managed to sell his production. The consumer had limited choice and high prices. The end of quotas is to the consumers' advantage and promises a new horizon for producers who can turn out quality shoes-Ottawa has taken a decision that is in the interest of the country as a whole.
What about this article from the November 22 Ottawa Citizen? it reads:
It took some nerve for the Government to drop barriers to footwear imports. The domestic industry, with visible political muscle, had been lobbying hard against the move for months. But abolishing footwear import quotas will benefit consumers-and the industry itself.
Also on November 22, Don McGillivray, the economist columnist for Southam Press, wrote:
The Tory Government has done the right thing-and a brave thing-in deciding to phase out shoe import quotas.
November 25, 1985

The Government has dared to provoke the wrath of a small, well organized and vocal section of the country to do the right thing on behalf of the consumers.
And so on, Mr. Speaker.
There has been a lot of loose talk in this House about broken promises.


John Edward Broadbent: There certainly has.


James Francis Kelleher: Let me conclude by talking a bit about promises kept, Mr. Speaker. The Government promised to get the Canadian economy moving again, and the figures speak for themselves.


Some Hon. Members:: Hear, hear!


James Francis Kelleher: In the 14 months we have been in office, we have created one-third of a million jobs, and unemployment has dropped from 11.6 per cent to 10.3 per cent.
When we came into office, the prime lending rate was 13 per cent. It has now dropped to 10 per cent, making it much easier and more attractive for business to invest in its future, and for Canadians to get mortgages and personal loans.
To get things moving again, we also concluded two oil agreements, the Eastern and Western Accords, replacing the destructive national energy policy of the previous Government. We did away with the Foreign Investment Review Agency, replacing it with Investment Canada. As a result, we are already beginning to get healthy doses of new foreign investment that will create jobs in Canada.


John Edward Broadbent: That is not true. Investment is down, not up.


James Francis Kelleher: We promised to put an end to the system of Government by fiat and introduce an era of national reconciliation, of consultation with all Canadians. We have done that.


Maurice Brydon Foster: Wait until Friday.


James Francis Kelleher: Mr. Speaker, I have every respect for the fact that the Opposition cannot automatically be expected to approve everything that we do in Government. I wish the Opposition would, but I know it will not.


Maurice Brydon Foster: Go down to the Maritimes to witness the First Ministers' Conference.


James Francis Kelleher: I have little respect for an Opposition that attacks everything the Government does automatically and without question. It is too late to ask opposition Members to modify their stance on the footwear issue. They are already committed to it, but it may not be too late to ask them to think a bit more carefully in the future for their good as well as for the good of the country.


Some Hon. Members:: Hear, hear!


John Edward Broadbent: Mr. Speaker, I would like to ask the Minister a question. I preface it by saying that his quoting of a couple of editorialists and an economic writer simply confirms
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my opinion of both those people and of the Government. It is hardly a persuasive argument to take one very traditional voice to support another traditional voice.
I want to ask the Minister to deal with one matter that I raised in my speech. No doubt it was an oversight on his part that he did not deal with it in his comments.
I pointed out that the industrial restructuring program involved in this sector had, in terms of usage of funds, used only about one-seventh of the money allocated, and that, although late in starting-and that has to be noted-the vast majority of firms now have a sort of three year modernization program under way. Since the Government was committed to the modernization of the industry and since the industry has now just started to implement these modernization programs, would it not have made much more sense for the Government to ensure that funds were spent and the industry modernized instead of, in effect, just abolishing the program now and hoping for the best?


James Francis Kelleher: Mr. Speaker, I did not ignore what the Hon. Leader of the New Democratic Party said in his speech. I heard him, but perhaps he is right, I should have answered earlier. I am glad now I have the opportunity to do so because I do not agree with him.
With the greatest respect, I feel he is wrong and what I am saying is backed up by the finding of the tribunal itself. You have to understand, Mr. Speaker, that the tribunal found in four of the five categories that restructuring had, in fact, been done. It had been completed and the industry in those sectors was able to compete. That is why the tribunal said quotas were no longer required in those sectors and should, therefore, be removed. The move was not premature.
The tribunal said that quotas had been given their chance to operate and had operated so well and so effectively in those sectors that protection was no longer needed. The tribunal said that they should be abolished, them, and we have concurred.
The tribunal found that the womens' and girl's shoes sectors were not ready yet to compete, and that restructuring had not been completed. I agree with my hon. friend that in some areas restructuring had not been completed. I agree with my hon. friend that in some areas restructuring had not been completed and that is what the tribunal found. It said that those quotas have to be kept on for another three years, exactly what the Government is doing.
I would point out that in those areas where there may be some disruption-and I say it will be minimal because the tribunal feels that these sectors will be able to compete-the Government, together with the assistance of my hon. colleague, the Minister of Employment and Immigration (Miss MacDonald), who is in the House this morning, has put together an excellent package of support programs not only for the workers in the industry but for the companies themselves, and now, through a new initiative of my colleague's Department, for the community itself. This is very beneficial.
In some small towns the shoe industry is the only industry. The former Government did not seem to be concerned about

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what could be done for those communities, but our Government has been concerned and we have implemented programs. Indeed all three, the workers, the community and the companies, will be taken care of by the package we are proposing.
[ Translation]


Alain Tardif: I listened with great interest to the remarks of the Hon. Minister. Maybe he was not in politics in May 1984 but I remind you, Mr. Speaker, that it happened by chance in your own riding.
The Prime Minister was very clear. Now, I did not know that there was a difference in the meaning of statements depending on where they are made: if you say something in a given place, it does not mean the same as when it is said some place else.
That being said, Mr. Speaker, the Minister is doing exactly what he blames us for, namely he is referring to specific sections of the Anti-dumping Tribunal's report. He takes press clippings and quotes some statements as they suit him.
But there is a constant element in the whole matter. Without quoting, because it would take too long, I remind you that on pages 52, 54, 67, 50 of the anti-dumping report, there is the unequivocal statement that thousands of jobs will be lost because of the decision you have made.
Therefore, I want to ask the Minister the following question: How many jobs will be lost because of your decision? You seem to say on one hand that there will be none. On the other hand, you say that your colleague, the Minister of Employment and Immigration (Miss MacDonald), has put together an execellent package. Therefore, will there be any jobs lost or not? If there are, how many lay-offs are anticipated? What are you going to do about the extremely painful situation in which those families who are faced with the prospect of losing their jobs in the near future find themselves?


James Francis Kelleher: Mr. Speaker, I know the Opposition does not like this, but I have to keep referring back to the tribunal's decision. That inquiry took over a year, with over 72 witnesses appearing and more than 39 written briefs submitted.


An Hon. Member:: You said that already.


James Francis Kelleher: That tribunal, as a result of its inquiry, said that quotas should remain on ladies' and girls' footwear. Again, Mr. Speaker, I remind my hon. friend that the production of women's and girls' shoes represents approximately 50 per cent of all shoes in Canada, with over 50 per cent of that particular production being carried on in the Province of Quebec. Given that quotas are continued on that production, there obviously is not going to be a loss of jobs in that segment of the industry.
With respect to the other sectors-and again I know you do not like to hear this-the tribunal found that no quotas were
needed. It was found that those sectors of the industry did not need production; that they could withstand the * rigours of competition. Those other sectors of the industry had restructured and updated themselves and, therefore, any disruption which would occur in those sectors, sectors in which quotas had in fact been removed, would indeed be minimal.
This Government has a concern for workers, communities and companies. Every job is precious to the person holding it, and we agree with that. Therefore, this Government wishes to put into a place a package to assist those people.
Surely to goodness you are not standing up and being critical of this Government for putting in place a package to assist people and communities and companies in the event that lay-offs do occur?
That assistance is something that this Government is proud of, and you should applaud our actions in this regard.


Some Hon. Members:: Hear, hear!


Alain Tardif: Mr. Speaker, does the Minister recognize that the Government had the legal capacity to dismiss the recommendations of the Anti-dumping Tribunal? And where is the logic of his argument? I do not understand your logic. You say: We are competitive enough to face the international market. On the other hand, you say: We will face the consequences. I hardly understand your logic and I would like to hear your comments in that regard.


James Francis Kelleher: Mr. Speaker, I am glad the Hon. Member raises this point about our having had the legal right not to accept the recommendation of the tribunal.
Mr. Speaker, I categorically disagree with him on that point, with great respect. The Ministry of Justice has given us a very firm opinion in that regard, and it is that, in the absence of a finding of inquiry-I repeat, in the absence of a finding of injury-under the legislation now in existence, we cannot legally impose quotas. I again remind the hon. gentleman that in four of the five categories involved, the tribunal found no injury. Therefore, in respect of those categories, we could not legally impose quotas.
I further point out to him that the legal opinion goes on to state that even in those cases where we can impose quotas, it is only for a maximum of three years.
So, not only have we done what is correct legally, we have done what is correct economically and what is in the best interests of the consumers of this country.


Some Hon. Members:: Hear, hear!


Don Boudria: Mr. Speaker, we are dealing here with a very major issue as it affects the constituents of the riding of Glengarry-Prescott-Russell.There are some 400 jobs in the constituency I represent in this particular industry.
November 25, 1985

I had a conversation this morning with both shoe factories in my riding, and I am particularly concerned for the situation of the employees and management of the Alexandria Footwear factory.
Alexandria Footwear is a company owned by Rosita Shoes, and the products from that factory are most commonly known as Adidas Shoes, Adidas being, if not the best, one of the best shoes made in this country in the category of athletic footwear, and the same is true of the other shoes produced by that factory as well. Adidas shoes have gained a good reputation among all Canadian consumers.
Mr. Speaker, we are living in hard economic times. Conditions are difficult. Notwithstanding the fact that the consumers are aware that Adidas shoes are the best, they are at times faced with the hard reality, because of the economic times, of having to opt for a less expensive product. Because of the hard economic times, the consumer will often opt for the imported product, a product which is manufactured at a lower cost outside of this country.
Mr. Speaker, as of 1983 there were 172 shoe manufacturers in this country, 41 per cent of whom were located in the Province of Quebec, 56 per cent in the Province of Ontario, with the remaining 3 per cent being located in other parts of Canada.
In that year, there were in this country some 3,500 jobs in the tannery industry and some 16,000 jobs in the shoe industry.
So, close to 20,000 jobs are at stake in this industry in our country. We produce some 35 million, 36 million pair of shoes, at an estimated value of close to $1 billion.
As one can see, this industry isn't small potatoes. It is a very important industry for our country, or at least it is for those of us in the Liberal Party. Quite obviously, the Members opposite think otherwise.
Mr. Speaker, this debate today is, in large part, about truth and honesty, and one's ability to keep one's promises.
Let me remind you, Mr. Speaker-and I am sure you are aware of this-of the promises that the Tories made last year. You are aware, of course, Mr. Speaker, that I listed these promises in a little booklet called 338 Tory Promises, copies of which I will gladly give to any Hon. Member or any member of the public who writes to me. I will gladly send out a copy of this book listing the 338 Tory promises, most of which have been broken by now. Those that have not yet been broken will probably be broken in a very short time.


Miss MacDonald:: You'd know all about it.


Don Boudria: The Minister of Employment and Immigration (Miss MacDonald) is listening very attentively. She was probably at the meeting in Quebec on July 26, 1984. If she was at that meeting of the Quebec caucus, she would know that a press release entitled Progressive Conservative Agenda for Government was released that day. Perhaps the Hon.
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Member for Dollar (Mr. Weiner) recalls that day. This press release deals with policy area in the textile and apparel industries. That does not directly involve the footwear industry but an interesting promise was made regarding this area. Promise number one was fair trade but not free trade.


Flora Isabel MacDonald: Hear, hear!


Don Boudria: I repeat, fair trade but not free trade. That promise was made on July 26. Today the Tories are selling off our shoe industry because it is hindering the free trade negotiations undertaken by the Tory Government.
The second promise contained within the press release deals with stability through the rigorous enforcement of our existing international rights and obligations, including if necessary the establishment of global quotas and a controlled increase in import volumes. What is so controlled about the dismantling of the system that now exists? Opening the flood gates hardly constitutes control in my book.
What have the Tories done since they came into office? They have broken just about every promise they made. Of course, I cannot say in the House that the Prime Minister (Mr. Mulroney) is a liar because you would not allow that, Mr. Speaker. However, I will say that the promises that were made-


The Acting Speaker (Mr. Charest):: Order. I am sorry, but neither could I allow an Hon. Member to do indirectly what he is not permitted to do directly. I would therefore ask the Hon. Member, knowing that he knows the rules full well, to respond.


Don Boudria: Thank you, Mr. Speaker. 1 withdraw that remark, but I will continue in my remarks to doubt the sincerity of the promises that were made. If the Prime Minister were Pinocchio, his nose would be a foot long and I will leave it at that. The promises that were made have certainly not been kept to the satisfaction of my constituents.
If any cabinet Minister thinks otherwise, let him or her come to Alexandria with me tomorrow to speak to those workers. I challenge any cabinet Minister to go there first thing tomorrow morning. I will even drive any cabinet Minister there. It is only an hour's drive from the national capital. Of course, no one will take me up on that offer, I am quite sure.


Flora Isabel MacDonald: It's the threat of driving with you.


Don Boudria: I note the remark of the Minister of Employment and Immigration. She has an expensive limousine at her service. She can cause the undue expense of having two cars drive to Alexandria rather than one. After all, the Prime Minister uses two jets to fly around. Perhaps, if the Minister wants a repeat performance, she could use two cars to drive to Alexandria to speak to the workers. Whether we go in one car or two, I am still willing to go to Alexandria to speak to the people accompanied by any cabinet Minister who wishes to take the opposing view by telling us why those jobs in Alex-

November 25, 1985
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andria should be lost. I make that challenge to any cabinet Minister.

I was saying earlier that I questioned the honesty of the promises made by the Prime Minister during the election campaign. I would like to read a few words taken from the Sherbrooke newspaper La Tribune, and I am sure that you are familiar with this quote, Mr. Speaker: "The quota policy would remain as it is, guaranteed Mr. Mulroney, who said that he was not in favour of free trade in this sector of activity."
The interview has to do with the footwear industry. This promise was made in Sherbrooke by the leader of the Progressive Conservative Party who is now Prime Minister of Canada.
Mr. Speaker, I would like to read from another Canadian Press report and also from another article published in La Presse of March 25, 1985, in which the Minister of Regional Industrial Expansion apparently stated that the Canadian textile, clothing and footwear industry should probably be guaranteed a share of the local market for a long period. This was last March, and I am now wondering whether a long period means six months in the mind of the Minister of Regional Industrial Expansion. I do not think so, Mr. Speaker. If it was deemed necessary, according to this interview with the Minister last March, to guarantee these jobs for a long period, why did he, also, break another promise made to the Canadian people?

Some Hon. Members have mentioned today that public opinion was not behind an extension of these quotas. I would like to disagree with those who have said that for the following reasons.
[ Translation]
A survey was carried out from September 16 to 20, 1985, by the Decima Research Firm of Toronto. I would like to read a few findings of this survey. The question was asked as follows: "According to some people, the Government should make use of quotas to protect the Canadian industry against foreign competition because it is important to protect jobs in Canada." People were then asked to choose one two alternatives, namely to protect jobs for Canadians or to provide greater access to less expensive products. Of the people surveyed, 66 per cent told Decima that they favoured the protection of jobs for Canadians. This means that two-thirds of Canadians do not agree with this decision made by the Conservative Party.
The following question was also asked and I quote: I would like now to ask you a few questions about the Canadian footwear industry. How important is the Canadian footwear industry to the Canadian economy and to employment in Canada. Is it very important, rather important, not very important, or not important at all? Taken together, the answers "very important" and "rather important" accounted for 84 p. 100 of all answers to that particular question.
And further on the following question was asked: In your opinion, how important is it for Canada to have its own footwear industry? Once again, 86 p. 100 of the people surveyed answered that it was very important and rather important that Canada should have its own footwear industry. And this Government is suggesting that it was sensitive to public opinion.
I heard the Hon. Minister make such a statement a while ago. If he is so sensitive to public opinion, why is he going against it?

I think the Government is trying to impose a death sentence on this industry, an industry that is very important to my constituents and many others. I know which Conservative Members represent ridings which contain shoe factories. Most of them have not spoken today. I know that I cannot say that some Hon. Members are not present in the House, but I will just say that some of them will have difficulty speaking on this issue this morning.
The Minister for International Trade (Mr. Kelleher), in reading from his speech earlier this morning, said that the decision of the tribunal was that on which he was hanging his hat. The tribunal had decided that we did not need quotas for four-fifths of the industry and that we needed to retain quotas for the other one-fifth of the industry. The Minister said that because the tribunal said it did not need quotas the Government would remove them. He has also said that for the sectors in which they are needed the Government has decided to increase them. On the one hand he is saying that where the tribunal has said no, he is agreeing with them. On the other hand he has said that where the tribunal says yes, he begs to differ with the tribunal and advocates something different. There are inconsistencies in the answers of the Minister.
The Minister also stated that no jobs would be lost and that his colleague, the Minister of Employment and Immigration, has all types of programs to accommodate people who will be losing their jobs. If no jobs are to be lost, then why would the people who are losing their jobs need to be accommodated?
In another contradictory statement the Minister said that people who lose their jobs in the shoe industry are better off elsewhere. Since when does it pay more to be on unemployment insurance than to be working? I would like the Minister to answer that question later. Since when it is more beneficial to be without a job than to be with one? That is voodoo economics from the Tory Party. Perhaps I should tell every one of my constituents who is about to lose his or her job that they should place their names on the Tory patronage list since that seems to be the only fruitful job-creation program the Government has created thus far. Many people have found jobs that way. In fact, more people have found jobs in that way than under all the other government programs combined.
The Hon. Member for Edmonton West (Mr. Dorin) put it very well when he asked his question earlier this morning. He spoke about the cost to the consumer. I do not think that the
November 25, 1985

cost to the consumer was a big factor in this issue. Even if it was and is a big factor Canadians have known for quite some time that it costs more to be a Canadian than to be an American. Having had the opportunity to move to the United States at some time in the past, many of us have chosen to remain in the country knowing that it costs more to stay. For my constituents and I, and on behalf of my Party, I would like to say that even though it does cost more, it is a price worth paying to be in this country.
The Government has dragged its feet for too long on this issue. Today in the Minister's response it was obvious that he had foot-in-mouth disease. It is obvious that the Tories will be given the boot over this issue.


The Acting Speaker (Mr. Charest):: Are there questions or comments? The Hon. Member for Nanaimo-Alberni (Mr. Schellenberg).


Mr. Schellenberg:: Mr. Speaker, in his speech, the Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) discussed-

-truth, honesty and the ability to keep promises. Can the Hon. Member explain what type of truth and honesty was involved with his Party and its ability to keep promises when we consider the situation of the implementation of wage and price controls in 1974? The Liberal Government promised it would not bring them in. In the 1970s the Liberals promised that they would wrestle inflation to the ground. In 1979 they promised that the price of gasoline would never be more than 18 cents a gallon.


The Acting Speaker (Mr. Charest):: Order! The Hon. Member for Bourassa (Mr. Rossi), on a point of order.


Mr. Rossi:: Mr. Speaker, the Hon. Member's comments are not relevant to the motion before us today.


Ted William Schellenberg: I am coming to the point, Mr. Speaker. I thought that I might as well make a bit of a preamble since members of the Opposition seem to enjoy preambles.
The final point I wish to make is with respect to the promise made in 1980 to build a pipeline to Vancouver Island, which never saw the light of day under the previous Government. The Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) has just returned from the West. I am sure there was truth, honesty and promises discussed in Vancouver over the weekend. When we speak about countervailing duties and the possibility of the threat of lumber quotas being imposed by the Americans against our own forestry products, how can the Hon. Member ask the Americans not to do that if we continue to prop up Canadian industries with quotas of our own? How can the Hon. Member explain that to the citizens of western Canada and, indeed, to all Canadians?
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Don Boudria: Mr. Speaker, it may come as a surprise to the Hon. Member that, in large part, the shoes we import do not come from the United States.


Steven W. Langdon: Mr. Speaker, I would like to pose the same questions to the Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) as those I posed to the Hon. Member from his Party who spoke before him. I ask the Hon. Member if he agrees with what I have to say. The three major problems which have put the footwear industry into the difficult position which it now faces are as a result of, first, the decision of the Liberal Government in 1981 to abolish entirely quotas on leather shoes. This was a decision which was in effect for eight months and which led to massive increases in importations into the country. It hurt a great many firms. Second, I deal with the failure of the policy with respect to the industry to push ahead restructuring of the footwear companies involved during the first period of quota protection from 1977 to 1981. Third, the fact is that the new system of quotas put into effect in 1982 did not cover many of the most dangerous and difficult imports which have to be faced by our footwear producers in the country. Is it not the case that the serious crisis which the footwear industry faces is very much the creation of Liberal government policy and Liberal Government mistakes?


Don Boudria: Mr. Speaker, I was wondering whether the Hon. Member was on the side of the Tories or on the side of the workers in the shoe industry. I am still uncertain as to which side he is on. However, I would like to answer his questions in any event. He asks if I am satisfied with the fact that quotas were removed in the past. The answer is obviously not. That is why we placed them on again.


Some Hon. Members:: Oh, oh!


Don Boudria: That was obviously unsatisfactory. In this respect I hope that the Tories will have the same sense as we had, although one cannot equate Liberal common sense with Tory common sense. Needless to say, I wish they would have the same sense.
The Hon. Member asks whether or not the measures which were instituted with respect to modernizing the industry were successful. He asked whether or not it was complete and so on. No, it is not complete. The CIRB program was a rather successful one. It is interesting that at the time when the industry needs it the most the Government has abolished it. In the near future the Government will disband CIRB. In that respect what the Tories have done is doubly wrong.
With respect to the loopholes in the present legislation, yes, there are loopholes. I have advocated tightening them up, as have others, but we still have 40 per cent of the market and not 12 per cent which could very well come to pass under the present Tory policies. If the quotas were so bad, the industry would not want them to be retained. In those terms they were obviously successful. However, they could have been made even better. I say to the Hon. Member from the New Democratic Party that 40 per cent is better than 12 per cent, but I would like to see 50 per cent.

November 25, 1985
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The Acting Speaker (Mr. Charest):: The Hon. Member for Richmond-Wolfe (Mr. Tardif), for questions and comments.


Alain Tardif: Mr. Speaker, first of all, I would like to congratulate the Hon. Member on his excellent speech and inform the House that if all Members showed the same courage in defending the interests of Canadian workers, wherever there are shoe factories in this country, we might get a better decision from the government than we have now.
My question is as follows: I assume you have had a chance to meet with your constituents who work in the footwear industry. In the light of the Minister's comments, in which he seemed to be saying that people working in the footwear industry were cheap labour working for very low wages, do you feel that the people working in this sector are satisfied with the kind of wages they are getting, and do they look to the future with confidence, as a result of the promised measures that are supposed to provide solutions to all their problems?


Don Boudria: Mr. Speaker, I would like to thank my hon. colleague for his very apt question. First of all, regarding the working conditions in the shoe industry in my riding, and the level of satisfaction or dissatisfaction of those who work there, I have had three meetings with workers from my riding in the last three months, and I also tabled in the House a petition signed by 1,000 constituents, requesting that the quotas be maintained, and most of them were workers in the industry. So that is what the workers in my riding want.
As for wage conditions, there have been no strikes in this industry in my riding for quite a long time, Mr. Speaker, and although like people anywhere else, workers would like to earn more, they would have been quite happy to keep their jobs, a possibility if the Conservative Government had not taken this particular action. It is too bad that with all the information the Government is getting from Opposition Members who have factories in their ridings, it has not bothered to ask Government Members for information, because there are a number who also have general factories in their ridings. If the Government had done so, the story would have been quite different.


The Acting Speaker (Mr. Charest):: Questions or comments. The Hon. Member for Ottawa West (Mr. Daubney).


Mr. Daubney:: Mr. Speaker, the Hon. Member for Prescott very kindly offered to drive one of our Ministers to his riding to meet with some of the workers. May I ask the Hon. Member, whose concern for Canadian workers is so touchingly expressed, whether the car in which he would drive the Minister is Canadian made and whether the shoes on his feet are made in Canada? He should know the answer to that because those shoes are in his mouth so often.


Don Boudria: Mr. Speaker, I am pleased to answer the maiden question of the Hon. Member for Ottawa West (Mr. Daubney) who had such difficulty in being recognized because he has never aksed a question before. I want to tell the Hon. Member that, yes, my car was made in Canada. It is an Acadian. It was made in Ste. Therese, Quebec. It is not one of those expensive American limousines which are driven by cabinet Ministers. And the name of my riding is Glengarry-Prescott-Russell, not Prescott. And my shoes are Canadian made.


Hon. Michel Cote (Minister of Consumer and Corporate Affairs and Canada Post):: Mr. Speaker, the Minister for International Trade (Mr. Kelleher) announced last Wednesday the new footwear policy adopted by the Government. This policy represents a major step forward in the implementation of the agenda for the economic renewal of Canada which was made public a year ago. I would like to address today some of the most important elements of the new footwear import policy which have a direct bearing on the mandate of my Ministry.
As a Minister responsible for consumer interests and competition policy, I have a keen interest in trade policy, since such policy can greatly influence the state of competition in Canada and the welfare of Canadian consumers. From this perspective, I am supportive of trade liberalization measures which contribute to increase the choice of products available to Canadians and foster a healthier state of competition in the Canadian economy. On the other hand, I am generally opposed to the imposition or extension of trade barriers such as global quotas which impose heavy costs on consumers and stifle competitive forces.
I have been particularly interested in the formulation of the Government policy on footwear because it is an important question for all Canadians and because it illustrates so well the difficult choices which Canadians will have to face in the years to come. What I would like to do today is to explain to the House why I believe the Government's decision on the footwear sector import policy is the right policy. In what follows I shall focus my attention on the effects of the prior global quota regime and contrast them with those which the new Government policy are expected to have on consumers, retailers and the footwear manufacturing industry.
The consideration of the relative costs and benefits of global quotas, particularly as analysed by the report of the Canadian Import Tribunal, has been a major factor in the formulation of the policy adopted by the Government. Before I turn to these questions, I would like to point out that the previous Government, which assigned the Canadian Import Tribunal to review the industry's positiion, was clearly aware of, and concerned with, the costs associated with the adverse affects of a global quota policy when it directed the tribunal to take, and I quote:
-into account the various elements that affect the retail price of footwear in Canada, examine what impact the import quotas on footwear have had on the operations and levels of activity of importers, wholesalers and retailers of these products in Canada and on the prices paid for footwear by Canadian consumers-
November 25, 1985


STATEMENTS PURSUANT TO S.O. 22
[Stage Direction]
To emphasize its recognition of the seriousness of these costs, the former Government went on to conclude its instructions to the tribunal in the following terms, and again I quote:
-in the event of a determination of injury or threat thereof, recommend a formula by which the special measures of protection could be phased out through a progressive liberalization process covering a period of not more than three years, by which time the Canadian industry would be required to face international competition without special measures of protection.
I believe that the previous Government was receptive in setting these terms of reference. The new policy we have adopted, which is based on the findings of the tribunal, is consistent with the analysis behind these instructions. [Translation]
As Minister of Consumer and Corporate Affairs, Mr. Speaker, I am particularly interested in the impact of quotas on Canadian consumers.
Though it is widely acknowledged that over-all quotas might protect the industry to a certain extent, they do have unfavourable effects on consumers by forcing them to pay more for goods which do not necessarily meet their needs and tastes. Shoe import quotas are not an exception to this general rule.
Evidence adduced during public hearings held by the tribunal clearly shows that quotas were responsible for higher prices for both imported and Canadian-made shoes. By restricting the supply of imported shoes, quotas make them more expensive and consumers are encouraged to buy domestically produced shoes which are relatively less costly. Stronger demand for Canadian shoes is the signal our manufacturers need to boost production and increase prices.
But quotas have a more subtle and pernicious effect than a simple across-the-board price increase: they create an artificial shortage of imported shoes, and import permit holders benefit from a shortage premium whcih amounts to an additional income. This is reflected in the difference between the price which the permit holder is able to buy his footwear on the national and world markets, and the price which he can sell them to Canadian wholesalers and retailers.
The quota system having thus given import permits a financial value, it is understandable that the holders, who have obtained these permits on the basis of their purchases over the preceding years, are unwilling to use them to purchase cheap footwear.
The Acting Speaker (Mr. Charest):: I must regretfully interrupt the Hon. Minister, but it being 1 p.m., I do now leave the chair until 2 p.m.
At 1 p.m., the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.

Mrs. Mary Collins (Capilano):: Mr. Speaker, 21 years often implies a coming of age, so yesterday, in Montreal, the B.C. Lions, who roared in 1964, finally came alive again in 1985. After 21 years they have returned the Grey Cup to British Columbia.


Some Hon. Members:: Hear, hear!


Mary Collins: All British Columbians who sat in the stands yesterday, or watched the game on television, felt a surge of western pride rising once again. As politicians know only so well, you cannot beat winning. Even our Liberal friends, if they were here, those who participated in that PR junket to B.C. on the weekend, would now probably be more aware of what a frosty Friday is like in Vancouver. They, too, 1 am sure, felt overwhelmed by the enthusiasm and pride which spread through British Columbia yesterday when our Lions ate the Hamilton Cats for brunch and we could truthfully say once more: we are the best.
Tomorrow a victory parade in Vancouver will provide a second opportunity for residents of Vancouver and the Lower Mainland to show their support of and gratitude to the B.C. Lions and this special all-Canadian sports competition in which the Canadian Football League enables us all to participate.
I was impressed, too, by the very special sportsmanlike behaviour of Canadians from across the land who attended yesterday's game. As I left the stadium surrounded by orange-


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


ADMINISTRATION OF JUSTICE
Mr. John Parry (Kenora-Rainy River):: Mr. Speaker, a trial is now taking place in the town of Kenora where the defendants have not even bothered to show up. The trial involves the spill of polychlorinated byphenols along the Trans-Canada Highway last spring by a company which has since ceased operations and apparently vanished. Among the charges brought against this company, four involve the offence of unlawfully permitting the discharge of materials contrary to the Ontario Water Resources Act. These charges contain a provision for fines and jail sentences if the defendant is found guilty. If, however, the defendant is not to be found in court on the day of the trial, something is clearly wrong.

November 25, 1985
The spill of PCBs along the Trans-Canada Highway last spring illustrated for all of Canada the need for thorough and enforceable environmental protection legislation. The fact that those responsible for that spill did not come to court to answer the charges is an affront to the people of northwestern Ontario and the people of the country. It is an affront to all who have had to put up with this irresponsible activity, and to the laws of this country and the Province of Ontario. It clearly illustrates the need for tighter registration and bonding of carriers of dangerous goods.


POLITICAL PARTIES
Mr. Bob Pennock (Etobicoke North):: Mr. Speaker, last Friday I was shocked, as I know all Canadians who read the Canadian Press report were, to learn that the NDP, the supposed defenders of Canadian jobs, have been employing a U.S. pollster for the last 18 months when there are Canadian firms that can do the job.


Mr. Blaikie:: What's the matter? Are you anti-American?


Robert Pennock: This comment is according to their own Party's secretary in British Columbia.


William Alexander (Bill) Blaikie: They are our best friends.


Robert Pennock: Is this the same Party that sits here, day in and day out, accusing the Government and the Prime Minister of selling out to the United States or allowing Americans to take away Canadian jobs? What hypocrisy!


William Alexander (Bill) Blaikie: You are anti-American.


Robert Pennock: While the NDP has been blowing hot air, we in the Government has been creating jobs for ordinary Canadians; 333,000 of them since the election.


William Alexander (Bill) Blaikie: I want it on the record that he is anti-American.


Robert Pennock: On the two major obstacles to economic recovery we have achieved signifcant results since the election. Unemployment has fallen from 11.6 per cent to 10.3 per cent, and for the first time in four years the federal deficit is showing signs of shrinking rather than expanding. If the NDP strives to be a credible Opposition, it should at least be consistent in its own hiring and practise what it preaches.


CANADIAN BROADCASTING CORPORATION
Mrs. Barbara Sparrow (Calgary South):: Mr. Speaker, a matter has been brought to my attention concerning a change in afternoon programming on the CBC AM radio in Calgary. The former 2 p.m. to 4 p.m. time slot was looked on as an oasis of relaxation, with a solid core of easy listening and interestingly varied music which was interspaced with quiet comments by a knowledgeable host. The change has been dramatic! Unhappy callers refer to music that is ear-splitting and raucus, and to a hostess who constantly interrupts with personal opinions. Most of the callers are from households which have been long-time supporters of the CBC, and they feel these changes have taken away the core of their pleasure in CBC listening.

I strongly urge the Minister to raise the matter with the President of the CBC in order to restore the afternoon programming to comply with the tastes of its listeners.


PUBLIC SERVICE
Don Boudria: Mr. Speaker, I have received a number of letters from people in the country and I would like to read one of them to you. It concerns Public Service cut-backs. It says:
Dear Sir,
I wish to strongly voice my opposition to the recently announced cut-backs, lay-offs and contracting out in Veterans' Affairs.
In the House of Commons Debates for October 17, 1985, page 7754 on "Public Service-Career Planning for Employees Facing Layoffs (B) Job Security", Mr. Doug Lewis (Parliamentary Secretary to President of Treasury Board) is quoted as saying:
"We appreciate that this is a delicate matter but there does not appear to be long lines of people pounding at our doors saying that they have been mistreated."
Consider me in line, pounding at your door! Service to veterans is why Veterans Affairs exists. Any cut-backs reduces that service.
This letter is signed by Mrs. Jeanne M. Bowles. I have similar letters from Mrs. Magaret Taylor, Sandra Messer, Agnes Marquis, Patricia Lamb, Louise Bolduc, and Gail Robertson, all employees of the Department in the area of Saint John, New Brunswick.


CANADIAN NATIONAL RAILWAYS
Mr. Rod Murphy (Churchill):: Mr. Speaker, last weekend Canadian National announced that it would be cutting auxilary service at Gillam, Manitoba. The auxilary is an emergen-
November 25, 1985

cy response train which goes out to deal with derailments and other emergency situations. Under CN directives an auxilary unit must be ready to leave its site within one hour. However, by removing the auxilary unit in Gillam, the nearest auxilary unit is something like 48 hours away. In other words, if there is a derailment on the major line-the only line into Churchill, Manitoba-during the grain season, it is quite possible that that line could be shut down for over a week.
The Government was notified on October 11 that this was a possibility, that CN was contemplating this move, and yet it did nothing. At the very time when we are looking for a method to ensure that grain can leave the country, all three ports of exit are in a situation in which they can be closed down. I think it is time that the Government acted seriously with CN, the Seaway, and all companies involved in exporting our grain to make sure that we have the ability to export our grain in the fastest and most efficient manner.


CANADA COUNCIL
Mr. Jim Edwards (Edmonton South):: Mr. Speaker, I rise today to discuss a matter of grave importance to our cultural community. The new funding method of the Canada Council, which was adopted earlier this year, threatens the Cultural independence of our museums and galleries.

For more than twenty years, those institutions who have proven themselves have been receiving annual grants from the Canada Council. There is now a new four-part application process to obtain financial assistance. Therefore, from now on, the Canada Council will be the one to decide what exhibitions the public should see.

The effect of this new method is devastating. The museum community has found it to be more costly, and more difficult to plan its budgets and programs. For example, the Edmonton Art Gallery has already been forced to postpone many important exhibits because of Canada Council's unexplained refusal to fund them. The Gallery will incur a deficit of up to $130,000 in 1985, in large part as a direct result of Canada Council's new funding policy for major museums.
The Edmonton Art Gallery is not alone. The future remains bleak for all museums in Canada because the Council has recently stated that it will not review its new policy for two years.
1 ask the House, should an appointed body such as the Canada Council have such discretionary power over the cultural make-up of our museums and galleries? It should not be up to the Canada Council to decide what exhibition is or is not worthy of funding. I say that our local art and museum patrons should make this decision.


THE ECONOMY
Mr. Don Ravis (Saskatoon East):: Mr. Speaker, I am prompted to rise in the House today by more good news on the economic front. A recent Gallup poll commissioned by the Canadian Manufacturers' Association proves that Canadians share the Government's conviction that the private sector is the key to economic recovery and sustained growth.
The poll results show that since 1982 the number of Canadians who believe that business is the key player in an improved economy has tripled. In addition, the number of Canadians who believe that only Government can provide the solution to economic problems has dropped by 20 per cent in the same three years.
Evidently, Canadians support our Government's policy of providing encouragement and incentives to small and mediumsized businesses. There is good reason for that support. Since September, 1984, 333,000 new jobs have been created in Canada. Unemployment is down by 1.3 per cent since the 1984 election. The response of small and medium sized businesses to the Challenge '85 program was overwhelming. Working together with provincial and federal Governments, these businesses created 100,000 jobs for Canadian students, 14,000 more than 1984's summer program.
The May 23, 1985, Budget contained many measures designed to encourage small and medium businesses. Those measures were greeted enthusiastically by the private sector then, and now Canadians across the country believe that
100,000	smaller businesses hold the key to our future prosperity.
Smaller businesses are the key to Canada's economic prosperity. Together, they and our Government will ensure our future security.


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


NATIONAL ENERGY BOARD
Nelson Andrew Riis: Mr. Speaker, last week in Calgary, Douglas Fenton, president of Alberta and Southern Gas Co. Ltd., told the National Energy Board that it should abolish the requirement that Canadian natural gas consumers should be guaranteed a 25-year supply before exports can occur. He believes that Canada should increase its exports substantially, forget the guarantees of security to Canadian consumers, and provide unlimited exports of natural gas to the United States market.
It seems strange that a Canadian company would advocate unlimited sales to the United States and have little regard for the security of Canadian consumers. However, what the president of Alberta and Southern Gas Co. did not make public at

November 25, 1985
Oral Questions
the National Energy Board hearings was that his company is 100 per cent owned by Pacific Gas and Electric Co. of San Francisco. His gas company is a subsidiary of the U.S. gas company. He was really being a mouthpiece for the U.S. parent company, saying to forget Canadians, their future and energy security, and sell Americans as much natural gas as possible, as cheaply as possible.
It may call itself an Alberta gas company, but it really is a U.S. gas company. When the president of the company calls for more exports to the United States, I trust that the National Energy Board will recognize just who is doing in the talking.



ORAL QUESTION PERIOD


Hon. Jean Chretien (Saint-Maurice):: Mr. Speaker, I wish to direct my question to the Secretary of State for External Affairs. Canadians were shocked and saddened to learn today that two Canadians were killed by terrorists who hijacked an Egyptian airliner and forced it to land in Malta. The Official Opposition and, I am sure, all Members of this House wish to express sincere condolences to the Leonard family. I would like to express the hope that the Government will do everything possible to assist the family in their time of sorrow.
Is it the intention of the Government to make sure that the family will be assisted in every form possible to help them in these very difficult circumstances?


Right Hon. Joe Clark (Secretary of State for External Affairs):: Mr. Speaker, I think that all Members of this House and everyone in the country share the sense of outrage and regret at the events in Malta and the death of two innocent Canadians.
Today both the Prime Minister and I were in touch by telephone with the parents and grandparents of the two Canadian victims and have, as the Hon. Member has suggested, indicated to them all of the co-operation of the Government of Canada and, indeed, all of the support of the Parliament and the people of Canada would be with them.


INQUIRY IF GOVERNMENT HAS MADE REPRESENTATIONS TO GOVERNMENT OF GREECE CONCERNING ATHENS AIRPORT
Joseph Jacques Jean Chrétien: A supplementary question, Mr. Speaker. I want to thank the Secretary of State for External Affairs for his statement. I would like to ask him a question on one of the problems which has led to this tragic situation.
As Hon. Members know, the Athens airport has been the site of several such attacks. I would like to know whether the Government has already made representations to the Greek Government authorities so they will make sure this airport will not be used again for similar highjacking attempts. Tragic incidents have occurred in recent months and it is with deep sadness that we were witness to a repeat of similar incidents over the weekend. Had the Government already made representations concerning the safety of Canadian travellers who use the Athens airport?


Charles Joseph Clark: Along with the other countries of the world, Mr. Speaker, we are trying to find out exactly where the terrorists boarded the aircraft. At this moment it is not at all certain that it was in Greece.


INQUIRY IF CANADIAN GOVERNMENT WAS CONSULTED AND CONSENTED TO ASSAULT ON AIRCRAFT
Joseph Jacques Jean Chrétien: Mr. Speaker, I should like to ask a supplementary question to the Secretary of State for External Affairs. According to the information I was given, the Canadian Government knew that Canadian passengers were on the Egyptian aircraft before it was stormed? Was the Canadian Government consulted before the Egyptian commandos stormed the aircraft and did it agree to this attempt to free the hostages?


Charles Joseph Clark: Under the circumstances, Mr. Speaker, there was no time for further consultation. Consultations were held only between the Egyptian forces and the Maltese authorities. There were no other consultations.

I should simply say in addition, Mr. Speaker, that all of us naturally deeply regret the loss of life. All of us know that terrorism and hijacking have to be stopped.
A very difficult decision was taken by Egyptian authorities on the ground, under pressure, on the basis of the best information available to them in the circumstances. I do not think it serves anyone's interest for us to try to second guess the wisdom of that decision.


Some Hon. Members:: Hear, hear!


ABORIGINAL RIGHTS
Mr. Keith Penner (Cochrane-Superior):: Mr. Speaker, I have a question for the Prime Minister. It has been reported today that the Government of British Columbia has turned down the offer made by the Minister of the Environment and

the Minister of Indian Affairs and Northern Development to mediate in the South Moresby-Lyell Island dispute. What proposal can the Prime Minister put forward now that would resolve this tragic and troublesome dispute in British Columbia?


Hon. David Crombie (Minister of Indian Affairs and Northern Development):: Perhaps, Mr. Speaker, I might be allowed to respond to the question of my hon. friend by saying that the process which was initiated a few days ago is still in train. There have been some discussions with all parties, and I will be maintaining my contact with those parties. I am hopeful we will be able to arrive at an opportunity for a meeting to bring about some process of mediation.


REQUEST THAT PRIME MINISTER INTERVENE
B. Keith Penner: I should like to come back to the Prime Minister. Last week the Prime Minister was asked on several occasions to intervene personally. It seems that we have reached an impasse, and I am wondering whether the Prime Minister would agree, when he meets with the Premier of British Columbia, to take up this matter with him personally, before the situation gets entirely out of hand and becomes even more tragic than it is at this very moment.


David Edward Crombie: Mr. Speaker, the Prime Minister, as it is my responsibility, asked me to participate in this matter, and I suggest that before people rush to the judgment that we have reached an impasse, they allow the process which is currently in train to proceed, in the hope that it will yield some results.


ATTENDANCE AT PROPOSED MEETING
Mr. Jim Fulton (Skeena):: My question is for the Minister of Indian Affairs and Northern Development.
I think all Members of this House were very pleased with the Minister's decision last Thursday night to begin negotiations on the comprehensive claim of the Haida people to the Queen Charlotte Islands, particularly in relation to Lyell Island and the South Moresby conflict.
But, to use the Minister's own words, as of Thursday night the situation was dangerous. As I am sure he is aware, a few moments ago another 19 Haida Indians were arrested.
I am wondering whether the Minister can bring us up to date, in relation to tomorrow's proposed meeting, in terms of whether or not any of the players involved-Western Forest Products Limited, the Haida Indians, or the B.C. Government-have agreed to come to such a meeting in Vancouver or Victoria tomorrow?


David Edward Crombie: Mr. Speaker, I think the only thing I can do at this time which might be useful is to tell the Hon.
Oral Questions
Member that the people who are concerned with this have asked me, along with the Minister of the Environment, to continue the process toward a meeting which could begin a process of mediation.
I was in communication just prior to Question Period with members of the Haida Indian Band, and as well there was communication earlier today with the Government of British Columbia. Also, two other parties have indicated an interest in such a meeting.
I think it is far too early to arrive at any conclusions. 1 am hoping to have another day or two in order to arrive at a situation in which the opportunities may become more clear.


ARREST OF ELDERLY INDIANS
James Ross Fulton: Mr. Speaker, the situation, as I know the Minister knows, is extremely urgent. I am wondering whether he can tell the House whether there are any additional administrative or constitutional powers, given the special relationship that this House of Commons has with the Haida people, that he might be able to make use of in this situation.
As we know now, 35 Haida Indians have been arrested in recent days, some as old as 80 years of age.
I am wondering whether there are some powers or initiatives, aside from the negotiation process, that the Minister might be able to use during this very crucial period so as to assist the Haida people in this very urgent situation.


David Edward Crombie: Mr. Speaker, at this point I think everyone would agree that the most important thing to be achieved is a meeting of the parties. If there is some further power or substantive support that I might need from the Members of this House, I know that I can call on it and receive it. But I think at this point the single most important step we can take is to have all Members bend their efforts to achieving the meeting of the parties involved.


Some Hon. Members:: Hear, hear!


EXPORTS OF LUMBER TO UNITED STATES
Hon. Lloyd Axworthy (Winnipeg-Fort Garry):: Mr. Speaker, my question is for the Secretary of State for External Affairs.
Reports out of Washington indicate that the U.S. senior trade representative, Mr. Yeutter, is going to his Cabinet tomorrow to discuss a whole set of new proposals to reopen negotiations with Canada on the lumber trade, including the discussion of stumpage fees, and that this is a prior condition to Congress being asked for approval to proceed with the general trade negotiation.

November 25, 1985
Oral Questions
Have we indicated to the Americans our agreement to a new round of negotiations, including the discussion of such subjects as stumpage fees?
And given that it is a matter clearly within the provincial jurisdiction, have we gained the approval of the provincial Governments that such negotiations can proceed at this time?
Right Hon. Joe Clark (Secretary of State for External
Affairs): Mr. Speaker, the Government of Canada, of course, is deeply concerned about the threat to the Canadian forestry industry that emanates from the United States. We have made it clear to the Americans, as they have made it clear to us, that there is no linkage at all between the resolution of that question and any negotiations on trade that might be entered into between the two countries.


STATEMENTS ATTRIBUTED TO UNITED STATES TRADE REPRESENTATIVE
Lloyd Axworthy: The American chief trade representative, Mr. Yeutter, has already stated that the matter of Prentice-Hall, the matter of patents on pharmaceuticals, and the lumber trade must all be resolved before the U.S. side will undertake to go to Congress for approval to start negotiations with Canada on a trade agreement.
I ask the Minister again: are we agreeing to such negotiations on lumber, on Prentice-Hall, on pharmaceuticals? And do we consider that to be an unfair representation as a condition for getting into the trade talks which this Government has proposed?


Charles Joseph Clark: Mr. Speaker, we have made a proposal to the United States with regard to discussing trade rules and trade negotiations. In so far as this Government is concerned, there will be no conditions involved from the American side that we will be accepting on those negotiations. I think it may be that the Hon. Member, without intending to do so, misread the intent of Mr. Yeutter's remarks.


ABORIGINAL RIGHTS
John Edward Broadbent: Mr. Speaker, I have a question for the Prime Minister. 1 would like to preface my question by commending the Minister of Indian Affairs and Northern Development for the commendable initiatives he took prior to the weekend regarding the difficult situation which affects the Haida people and others on the West Coast. More than 19 Haidas were arrested this morning. These particular people are well known for their peacefulness, and many of the people who are being arrested are elderly. Considering that, and considering the fact that the Minister of Indian Affairs and Northern Development just said that we should all
be making our best efforts to get negotiations under way, would the Prime Minister consider phoning directly to the Premier of British Columbia to ask for his Government's participation in these important negotiations?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, I thank my hon. friend for his question. It is a troubling situation and we are doing our utmost to resolve it in an appropriate manner. The Minister has handled this situation with sensitivity thus far and I would hope the House would allow him to pursue his initiative in that sense.


PRIME MINISTER'S POSITION
John Edward Broadbent: Mr. Speaker, I am sensitive to the Prime Minister's choice of words and to the delicacy of the situation. Given the urgency of this matter for the Haida people and for the others involved, if the Minister's efforts with other Ministers in the British Columbia Government, efforts which have already been considerable, do not bear fruit by tomorrow, will the Prime Minister at that point consider contacting the Premier directly?


Martin Brian Mulroney: Mr. Speaker, as I think my hon. friend would allow, the question is hypothetical. I will be guided by the good counsel of the Minister of Indian Affairs and Northern Development and we shall not hesitate to assume the responsibilities incumbent upon the Government and Parliament of Canada.


UNEMPLOYMENT INSURANCE
Mr. George Baker (Gander-Twillingate):: Mr. Speaker, on November 8, a 31-year-old fisherman from Newfoundland, Harvey Hawkins, travelled to the Toronto Hospital for Sick Children to donate one of his kidneys to save the life of a 14-year-old girl, his younger sister. Because he did that, the Unemployment Insurance Commission cut off his unemployment insurance payments.
My question is directed to the Minister of Employment and Immigration who has received notice of this question and has had time to consult her officials. Will the Minister exercise her ministerial discretion by reinstating Mr. Hawkins' unemployment insurance benefits, the only income he receives which allows him to pay his bills and support his family?


Flora Isabel MacDonald: Mr. Speaker, I too have concern and sympathy for the case that has been raised by the Hon. Member. As he knows, the Unemployment Insurance Act makes no provision for special and deserving cases of this kind, and neither do I as Minister under the Act have any discretion to act in these cases. However, that is one of the reasons why a case like this must be directed to the Commission of Inquiry on the Unem-
November 25, 1985

ployment Insurance Commission which may see to it that such discrepancies do not exist in the future.
In the meantime I can tell the Hon. Member that we are taking two steps. One is to ensure that the provinces concerned offer social security payments to Mr. Hawkins during the time he is in hospital. The second is to ensure Mr. Hawkins that, on his return to Newfoundland, he will be guaranteed work under the Canadians Jobs Strategy.


Some Hon. Members:: Hear, hear!


REQUEST FOR REINSTATEMENT OF BENEFITS
George Baker: Mr. Speaker, it is difficult to figure out what is going on here. If a man rushed into a burning building to save a child, he would receive the Governor General's Medal for bravery. This man does not want a medal. He wants the income back which he rightfully deserves. Given the fact that there was a problem with the operation and it is now Mr. Hawkins who is on the kidney dialysis machine in the General Hospital in Toronto, will the Minister use whatever discretion is required, either through Cabinet or not, to reinstate this man's benefits for the sake of compassion? Has the Government no compassion for the invidivual any more? What is going on? We want an answer and we want it now. This man is worried about his bills. He is worried about supporting his family now. He cannot get the $620 from welfare.


Some Hon. Members:: Hear, hear!


Flora Isabel MacDonald: Mr. Speaker, 1 do not need any lessons in compassion from the Hon. Member.


Some Hon. Members:: Hear, hear!


Flora Isabel MacDonald: I say to the Hon. Member that the discretion which I am denied as a Minister under the Act is because his Government, when in office-


Some Hon. Members:: Oh, oh!


Flora Isabel MacDonald: -took away that type of discretion. I do not have it.


Some Hon. Members:: Hear, hear!


Flora Isabel MacDonald: I also say to him that we will take steps to ensure that there is support for Mr. Hawkins, and work for him. I am not sure that when the Hon. Member's Party was in Government that it would have taken those steps.


Some Hon. Members:: Hear, hear!
Oral Questions TRADE


ELIMINATION OF FOOTWEAR IMPORT QUOTAS
Mr. Dan Heap (Spadina):: Mr. Speaker, my question is directed to the Prime Minister. Doe she remember the promise he made in Sherbrooke on May 4, 1984, when he was campaigning for election in which he said that a Conservative Government would not abolish the import quotas in the footwear and textile industries? Now that the Minister of International Trade has announced that the great majority of the affected quotas will be abolished, will the Prime Minister tell us why he has failed to keep the promise that he made when he was looking for the votes of the workers in the footwear industry?


James Francis Kelleher: Mr. Speaker, as I have previously advised the House, there were no broken promises. We are not a Party of broken promises.


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!


James Francis Kelleher: Where and when quotas are required for the protection of the industry, we will keep them in place. That is exactly what we did. The tribunal said that they were required for children's and women's footwear and we kept them in place. The tribunal said that they were not required for the other classes of footwear and we took them off. Is the Hon. Member suggesting that where they are not required we should add another $500 million cost to the consumers of the country? I say no.


Some Hon. Members:: Hear, hear!


Daniel James Macdonnell Heap: Mr. Speaker, I hope to reply later to the Hon. Minister's question at a more appropriate time.


PRIME MINISTER'S POSITION
Daniel James Macdonnell Heap: Mr. Speaker, I have a further question for the Prime Minister as to whether he has abandoned another of his Ministers who happens to be away on sick leave. I am referring to the Hon. Minister of Regional Industrial Expansion who said on this subject only in June of this year-


Some Hon. Members:: Question.


Daniel James Macdonnell Heap: -that what you were talking about then was saying-and he was referring to the removal of the quotas- there will be no footwear industry-


Mr. Speaker:: Order, please. I am in some difficulty because this is becoming quite a long preamble to the Hon. Member's supplementary question. Is there a question?

November 25, 1985
Oral Questions


Daniel James Macdonnell Heap: My question is: As well as abandoning the policy of his Minister of Regional Industrial Expansion, has he also abandoned the absent Minister?


Martin Brian Mulroney: Mr. Speaker, no and no.


EXTERNAL AFFAIRS
Mr. Bill Tupper (Nepean-Carleton):: Mr. Speaker, my question is for the Secretary of State for External Affairs. Noting that technology development and transfer must be a cornerstone of an industrial policy, can the Minister tell the House if our Government is putting technology development officers in place in our consulates to assist in the exchange of transfers of technology? If so, when will this plan be in place?
Right Hon. Joe Clark (Secretary of State for External
Affairs): Mr. Speaker, we are indeed doing that as a means of encouraging Canada's ability to take our place of leadership again in the international markets. There have already been six technology development officers designated for embassies or consulates around the world designed particularly to try to help Canada's small and medium-sized businesses which we want to help encourage to become part of international trade and international markets.


GOVERNMENT EXPENDITURES
Don Boudria: Mr. Speaker, my question is for the Prime Minister. In August a member of the Prime Minister's staff assured the Canadian media and the people of Canada that the practice of flying two jets to bring the Prime Minister to a destination-


Some Hon. Members:: Oh, oh!


Don Boudria: -would be cancelled and that the procedure was never authorized by the Prime Minister in the first place. Can the Prime Minister tell the House whether on his last trip to Florida he was personally aware that his aircraft was followed by another jet belonging to the Government of Canada? What does the Prime Minister intend to do about this practice?


Hon. Erik Nielsen (Deputy Prime Minister and Minister of National Defence):: Mr. Speaker, since the matter falls within my jurisdiction perhaps the Hon. Member would be enlightened, as the journalist and others who followed that line were not when they wrote this story, that a flight was neither authorized nor requested but was pursued in the normal course of meeting training requirements.


Some Hon. Members:: Oh, oh!


Erik Nielsen: The laughter of Members opposite just-


Mr. Blackburn (Brant):: It just happened to go to West Palm Beach.


Erik Nielsen: -illustrates their complete ignorance of the subject matter with which we are dealing. The fact of the matter is that the flights which have been made by members of this Government this year as compared with the last year of the Liberal administration are down almost 40 per cent.


Some Hon. Members:: Hear, hear!


REQUEST THAT INQUIRY BE INSTITUTED INTO USE OF TWO JET PLANES FOR TRANSPORTATION OF ONE PERSON
Don Boudria: Mr. Speaker, could the Minister of National Defence personally give this House the assurance that he will enquire into this matter, a coincidence that cost the Canadian taxpayer $ 11,000 to have two jets for one person?


Erik Nielsen: Mr. Speaker, I do not have to conduct an inquiry to inform the hon. gentleman that training flights are conducted by our Armed Forces with the whole range of its aircraft throughout the world, not just in the United States and Canada. This was a regular training mission which was in that part of the country. I do not know why the hon. gentleman does not do a little homework and bone up on these things so that he can become familiar with them.

[ Translation]


FOOTWEAR INDUSTRY
Steven W. Langdon: Mr. Speaker, I have a question for the Prime Minister. After his extensive reply, any Canadian would want a frank and forthright Government in this country. After the decision made last week regarding quotas in the footwear industry, is the Prime Minister going to say he regrets the promise he made on May 4 of last year, in Sherbrooke? Does the Prime Minister regret his promise?


Martin Brian Mulroney: Mr. Speaker, on May 4, 1984, we made a statement which was an accurate reflection of our philosophy and our policies. On June 14, a few weeks later, the Liberal Government instructed the Canadian Import Tribunal to review an agency whose members were appointed by the Liberal Government, and instruc-
November 25, 1985

tions were given to review this matter. A year later, the Tribunal appointed by the Liberals submitted a report that formed the basis for this decision. So there has been no change in policy, and there is this new and important dimension that was added by the Canadian Import Tribunal. Nevertheless, the Government's policies are aimed at improving conditions and providing more assistance for these advanced technology industries in creating jobs not just in the Eastern Townships but across the country.


Steven W. Langdon: What the Prime Minister in fact is saying is that he is pleased to implement a Liberal policy initiative. I think he should regret that.


TEXTILE IMPORT QUOTAS
Steven W. Langdon: Does following a course behind a Liberal policy in that case also mean that the Prime Minister's promise to maintain textile quotas will be similarly abandoned as a result of Liberal moves which were put in motion to review that policy? Is that promise made to the voters of Quebec also to be abandoned?


James Francis Kelleher: Mr. Speaker, the textile industry, and the policy with respect to that industry, is presently being reviewed by the Government and several members of Cabinet. I can tell the Hon. Member that we are well aware of the concerns of the industry and of the workers employed in that industry. We are deliberating on the matter very carefully and I hope that within the next while we will be able to announce a decision to this House on what our policy will be with respect to that industry.


EXTERNAL AFFAIRS
Mr. Barry Turner (Ottawa-Carleton):: Mr. Speaker, my question is directed tothe Secretary of State for External Affairs. At the beginning of November the Government of South Africa imposed restrictions on the news media which seriously curtail the flow of information about the violence in that country. Would the Minister tell the House what impact this ban is having on our ability to be kept well informed on the internal situation in South Africa?


Charles Joseph Clark: Mr. Speaker, I think that the Government and the people of Canada continue to have the capacity to be well informed on events in South Africa.
I want to take this opportunity to say that this Government deplores the continued erosion of civil rights in South Africa as was indicated most recently by the ban upon the freedom of journalists. The way to have the truth be known is not to try to
Oral Questions
control the media. What the Government of South Africa should do if it is concerned about world opinion is change the basis of its policy rather than try to restrict the people who report it.


PRICE OF NATURAL GAS IN ONTARIO
Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, my questions directed to the Minister of Energy, Mines and Resources. Last June the Minister promised a fair deal for natural gas consumers. It seems that this fair deal meant freezing the price even though the world price for natural gas is going down everywhere else. Will the Minister listen to the Deputy Minister of Energy for Ontario and allow distributors to reopen negotiations so that consumers can look forward to a greater savings than the measley $9 a year which they will be saving on their heating bills this year?


Hon. Pat Carney (Minister of Energy, Mines and Resources):: I am afraid the Hon. Member is misinformed. 1 did listen to the Minister to whom he refers, and I gave him exactly what he asked for, which was the kind of service he felt that Ontario would benefit from. What we need now is for the Government of Ontario to meet its commitment to change its legislation and its regulatory framework in order to allow those benefits, which are now available, to be passed on to the consumers. That is something the Government of Ontario has yet to do.


MINISTER'S POSITION
Russell Gregoire MacLellan: Mr. Speaker, the Minister is not dealing with the question. The fact is she didn't give consumers a fair price and she didn't reduce the price. Will the Minister go back to the drawing board, reduce the price of natural gas to consumers, and give them a fair price as she promised in June?


Pat Carney: Mr. Speaker, we are not interventionists like the Liberals before us. We are trying to get Government away from the drawing board and that is what we have successfully done. In terms of benefits to the consumers, as of last November 1 there have been benefits available to consumers through direct sales as soon as the Governments of Ontario and Quebec make the appropriate changes to their legislation and regulations.

November 25, 1985
Oral Questions NUCLEAR ARMAMENTS


REQUEST THAT PARLIAMENTARY SECRETARY BE REPLACED
Ms. Pauline Jewett (New Westminster-Coquitlam):: Mr. Speaker, my question is directed to the Prime Minister. Is the Prime Minister aware that at the very time he was in Brussels hearing from the President of the United States about new efforts at the Summit to reach international understanding, stability and peace, two of his caucus colleagues were displaying arrogance and scorn toward the Physicians for Social Responsibility and other Canadian groups-


Some Hon. Members:: Oh, oh!


Mr. Crosbie:: Nonsense.


Pauline Jewett: -engaged in the same search? Will the Prime Minister ask his colleagues to refrain from destroying legitimate public input and, indeed, his own commitment to the
search-


Some Hon. Members:: Oh, oh!


Mr. Speaker:: Order, please. I believe the Hon. Member is raising again a matter which occurred in committee. I think she knows that that is really not a matter which should be raised here. Does the Hon. Member have a question of policy?


Pauline Jewett: Yes, Mr. Speaker.
May I preface my supplementary question by saying-


Some Hon. Members:: Oh, oh!


Pauline Jewett: -that this is based on newspaper accounts-


Mr. Speaker:: Order, please. That does not help, either. I invite the Hon. Member to put a question.


Pauline Jewett: Would the Prime Minister at least consider replacing the Parliamentary Secretary to the Minister of National Defence with someone who is prepared to listen to Canadians' views about vital defence issues such as the prevention of nuclear war?


Martin Brian Mulroney: Mr. Speaker, I think my hon. friend would probably agree with me- because we have been criticized for it-that there has probably never been a Government which has listened so carefully and so thoughtfully to Canadians, and that includes listening to the Hon. Members of the House. But particularly in the area of foreign affairs, with commitees travelling across the country, with White Papers being presented, we have actively sought for, and obtained, the input of Canadians on this matter and we will continue to do so.


Pauline Jewett: Try your colleagues.


Martin Brian Mulroney: I think my colleagues on this side of the House require no lessons from members of the NDP.


Pauline Jewett: Well, it won't happen again, I hope.


John Carnell Crosbie: Stop breaking the rules.


Mr. McKenzie:: There's no place for communists in here.


An Hon. Member:: Why don't you go back to South Africa where you belong?


THE ECONOMY
Mr. Geoff Wilson (Swift Current-Maple Creek):: Mr. Speaker, my question is directed to the Minister of Finance and concerns the annual report of the OECD. The organization for Economic Co-operation and Development based in Paris conducts ongoing economic research and does analysis between and assessments of the economic performance of various countries in the world. At this time, generally, an annual report is forthcoming. Has the Minister received such a report? And if he has, how does Canada rate in the assessment of the OECD?


Geoff Wilson: Mr. Speaker, the Hon. Member is quite right. At this time of year there is a report which is done by the OECD on the policy direction which the country as followed, as well as the economic prospects looking a year ahead. While I am not able to release this report at this point in time, I have seen a preliminary draft and I can assure the Hon. Member that the preliminary views expressed by the OECD are extremely positive as far as Canada is concerned. It has confirmed that the policy direction which we set out on November 8 last year in the Economic Agenda Paper is the right policy, and that it is producing tremendous results for Canada.


AGRICULTURE
Maurice Brydon Foster: Mr. Speaker, my question is directed to the Minister of Agriculture. A week ago Saturday, 800 farmers demonstrated in front of the Minister's constituency office in St. Thomas to protest the lack of action on the farm debt crisis. Can the Minister say when the Government is going to take action as demanded by the seven responsible farm groups, on a comprehensive farm debt moratorium and farm credit arrangements legislation?


Hon. John Wise (Minister of Agriculture):: Mr. Speaker, I appreciate the representation made by the Hon. Member on the subject. He will know that we have taken to this point in time a long list of initiatives to benefit the agri-food industry and we are quite prepared to take further steps very shortly.
November 25, 1985


FARM GROUPS- DEMAND
Maurice Brydon Foster: Mr. Speaker, seven responsible farm groups demanded action within a week. Why has the Minister failed to meet the legitimate demands and deadline which the farmers put before him at that meeting?


John Wise: Mr. Speaker, if the Hon. Member had any memory at all he might be aware of the answer. The simple fact is that that was done on a Saturday, the four o'clock Friday deadline, and it just so happened that the House did not sit that week.


FINANCE
Nelson Andrew Riis: Mr. Speaker, my question is directed to the Minister of Finance. He will recall moving very quickly once the research and development loophole was brought to his attention, but only after it cost the federal Government many hundreds of millions of dollars. After considering the Genstar tax ruling and recognizing that it will cost the taxpayers hundreds of millions of dollars as other companies take advantage of that ruling, does the Minister support that new loophole? If so, why? If not, what action is he taking to close it?


Geoff Wilson: Mr. Speaker, I read the media reports on this particular transaction and I have requested information from the Department. There is an in-depth review going on right now and I hope to make some comment in due course.


ENVIRONMENTAL AFFAIRS
Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, my question is for the Minister of the Environment. Chemical substances are now being developed for which there are no national standards. As this is an urgent matter, will he direct his Department to establish these standards for the protection of the health of the people who take their water from the St. Clair River and the Great Lakes?


Hon. Tom McMillan (Minister of the Environment):: Mr. Speaker, the Hon. Member's question has perhaps been prompted by certain observations made by the Law Reform Commission in this regard. My colleague, the Minister of Health, and I have established a high-level task force which met several times in September and October and will be meeting again on December 17. We hope that very early in the new year we will have recommendations from that task force
Oral Questions
which we can bring to Cabinet for early changes to the Environmental Contaminants Act.


ST. CLAIR RIVER POLLUTION-INVESTIGATION OF INDUSTRIAL PLANTS
Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, in view of the understandable preoccupation of communities which take their water from the St. Clair River, is the Minister willing to say whether he will also launch an investigation into the activities of industrial plants along that river in Sarnia which are upstream to the communities taking their water from this river?


Thomas Michael McMillan: Mr. Speaker, I always welcome thoughtful observations from the Hon. Member and others on all sides. This one is no exception. However, I urge him to make it clear in all his public statements, including here in the House, that the drinking water from the St. Clair River meets all of the vigorous and rigorous international standards laid down by the World Health Organization. The responsibility for testing the quality of drinking water as opposed to the St. Clair River water in general rests with the Ontario Government. However, I am working hand in glove with my Ontario counterpart to make sure that high standard is met on an ongoing basis well into the future.


CONSUMER AFFAIRS
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, my question is directed to the Minister of Consumer and Corporate Affairs. On Friday he said, in connection with his proposals to deal with tax discounting, that they would put this form of loan sharking entirely within the limits allowed under the Criminal Code. Surely the Minister knows that the average refund is just over $700. Tax discounters using his formula will be able to charge $65 to process the refund. Since the Department now says that the refunds go out in a month, these people are really charging an interest rate of over 100 per cent. Is the Minister satisfied with that?


Michel Côté: Mr. Speaker, I believe that last week we announced a decision, following consultations that were very thorough and that were also instrumental in correcting certain discrepancies in a system that was inadequate to start with, a decision that has also helped to reduce costs, if we consider the Tax Rebate Discounting Act, for all Canadians and especially those on low incomes.

November 25, 1985
Oral Questions


POSITION OF CONSUMERS' ASSOCIATIONS
David Orlikow: Mr. Speaker, the Minister says he had intensive consultations with various groups. Did any group such as the Consumers Association or the National Anti Poverty Organization, any group except the tax discounters, tell him they were satisfied with the proposal he made?


Michel Côté: I think there are many associations that have stated their satisfaction with the Government's decision, because it introduces measures that will provide for freedom of choice and at the same time discourage this practice, to a certain extent.


FOOTWEAR INDUSTRY
Alain Tardif: Mr. Speaker, my question is directed to the Minister for International Trade.
Before breaking his election promise and betraying working men and women in the footwear industry, could the Minister advise the House whether his Department had carried out studies to determine the number of people who would be laid-off as a result of last week announcement?


James Francis Kelleher: Mr. Speaker, once again I reiterate that in no way have we betrayed any employees of the footwear industry. Indeed, we are very cognizant of their concerns and their jobs. The tribunal looked into this whole question fully. They found there would be no loss of jobs because the industry could now meet the competition. Any loss would indeed be minimal. As you know, my hon. colleague, Flora MacDonald, has already announced and put in place-


Some Hon. Members:: Oh, oh!


Derek Nigel Ernest Blackburn: Name dropper.


James Francis Kelleher: I am sorry. She has put in place many programs which will assist these workers in the rare event it is required.


REQUEST FOR CLARIFICATION ON SUBJECT OF SHOES FOR WOMEN AND GIRLS
Alain Tardif: Mr. Speaker, I have a supplementary question. The new policy provides for a meek protection concerning shoes for women and girls.
I should like to know what the Minister intends to do to avoid the loopholes following his last week decision. What is he planning to do in order to block any loophole in this area of activity of the Canadian footwear industry?


James Francis Kelleher: Mr. Speaker, I am not aware of any loopholes in the tribunal's decision. They found that the women's and girls' shoes category needed protection. They asked that quotas be retained for another three years. We agreed to do that. Not only that, we agreed to phase quotas out much more slowly than the tribunal recommended. Obviously we have their concerns at heart.

[ Translation]


GULF REFINERY IN MONTREAL-GOVERNMENT PLANS TO STOP CLOSURE
Mr. Ian Waddell (Vancouver-Kingsway):: Mr. Speaker, I have a question for the Minister of Energy, Mines and Resources. I was recently in Montreal in connection with the Grey Cup Game which incidentally we-I mean, British Columbia-have won and to meet the workers of the Gulf refinery in Montreal East.
What is the Minister going to do now to keep the Gulf refinery in operation, in view of the promise she made to the Gulf workers? What is the Minister planning to do now to keep this refinery in operation?


Pat Carney: Mr. Speaker, I am glad to join with the Hon. Member in expressing our great satisfaction with the fact that British Columbia won the Grey Cup.


Some Hon. Members:: Hear, hear!


Mr. Hnatyshyn:: The vote was fifty-fifty in Cabinet.


Some Hon. Members:: Oh, oh!


Pat Carney: I am sure he will agree with me that it is a great start to our year of Expo '86 in Vancouver.
As to the Gulf refinery, the Hon. Member already knows that it is at my request that Gulf is keeping the refinery open so that potential buyers can emerge and commercial transactions can be considered.
November 25, 1985


CONSUMER AFFAIRS
Miss Aideen Nicholson (Trinity):: Mr. Speaker, my question is directed to the Minister of Consumer and Corporate Affairs. Income tax discounting, lending money against the borrower's expected tax refund, cost Canadian taxpayers $41 million last year. In view of that fact, will the Minister agree that attempts to regulate this practice are not working and it is time to bring it to an end?


Michel Côté: Mr. Speaker, I think I have already answered this question on a previous occasion. We have made this decision following consultations in the best interest of taxpayers, especially those with a small income.


IMPACT OF DISCOUNTING ON LOW-INCOME TAXPAYERS
Aideen Nicholson: The Minister's proposal to allow discounters to keep 15 per cent of the refund on the first $300 means the tax preparers will continue to make their money mainly from the poor. Will the Minister not reconsider that decision, especially since 15 per cent over four to five weeks, annualized, is a rate above what the Criminal Code allows?
[ Translation]


Michel Côté: Mr. Speaker, I believe we have established a policy which has sensibly and substantially reduced the cost of income tax refund discounting. We allow discounting services, but we continue nevertheless to protect consumers against abuses.


PRIVILEGE
[Stage Direction]
NOTICE OF QUESTION RESPECTING INTERJECTION OF MR. McKenzie
Mr. Speaker:: The Hon. Member for New Westminster-Coquitlam (Ms. Jewett) on a question of privilege.


Pauline Jewett: Mr. Speaker, there was an interjection which I believe denied the privileges of every Member of this House. I would like to give notice of a question of privilege on the interjection of the Hon. Member for Winnipeg-Assiniboia and will raise the question of privilege tomorrow after we have all had a chance to read the "blues".
Statements by Ministers


A. Daniel McKenzie: Mr. Speaker, my riding is Winnipeg-Assiniboine.


John Edward Broadbent: How did you know whom she was talking about?


Maurice Brydon Foster: We all heard you, Dan.


Lloyd Axworthy: We don't have to read the "blues" now.


Pauline Jewett: Maybe I don't have to wait.


Mr. Speaker:: Order, please. I am not quite sure what the Member is proposing to raise later of which she is giving notice. If it is a question of order or a question of language, I may have missed something but-


Lloyd Axworthy: We all heard it.


Mr. Gauthier:: We all heard it.


Mr. Speaker:: -I am perfectly happy to let her bring her case before the House tomorrow.


Pauline Jewett: That is fine, Mr. Speaker.


Mr. Speaker:: She will realize that it may not be a question of privilege, but may in fact be a question of order that should have been brought today.


Derek Nigel Ernest Blackburn: Oh, it is a question of privilege.



ROUTINE PROCEEDINGS


Charles Joseph Clark: Mr. Speaker, I rise to make a statement-


Mr. Speaker:: Order! I regret to interrupt the Minister, but I ask Members of the House to have their conversations elsewhere, please, including those who are having them behind the curtains who cannot hear me because they are talking.


Charles Joseph Clark: Mr. Speaker, I rise to make a statement on the tragic deaths of a young Canadian mother and her infant son. Although we are awaiting formal identification by the husband and father, our information is that Mrs. Valinda Leonard and her infant son, Andrew, of Beiseker, Alberta, were killed in the hijacking of the Egyptian airliner to Malta. I wish to express my own deepest condolences and those of the Government and of the people of Canada to her family. I also, Sir, want to pay tribute to the manner in which the family has responded to the stress and tragedy of this weekend.

November 25, 1985
Statements by Ministers
No nation is immune to the scourge of terrorism. Two innocent Canadians now join the list of victims of this international brutality. The Government of Canada condemns the hijacking of the Egyptian airliner and profoundly regrets the tragic loss of life which ensued. This most recent incident again demonstrates the urgent need for concerted international action to combat acts of terrorism. The Prime Minister (Mr. Mulroney) raised this issue before the United Nations General Assembly. The Minister of Transport (Mr. Mazankowski) has proposed changes affecting international air travel.
With our friends and allies Canada is pursuing other concrete measures to combat terrorism. Senior officials of my Department will be meeting in Bonn on December 10 and 11 to continue consultations with our Summit Seven partners. We will continue to pursue vigorously all available means to eliminate the scourge of terrorism and to bring to justice the perpetrators of these brutal acts.


Some Hon. Members:: Hear, hear!


Joseph Jacques Jean Chrétien: Mr. Speaker, I wish to join the Secretary of State for External Affairs (Mr. Clark) in offering, as I already said during oral question period, my sincere condolences to the bereaved family.
I agree with the Secretary of State for External Affairs that this is a phenomenon that is becoming increasingly widespread, and we can no longer consider ourselves immune to this kind of occurrence. Here in Canada, we thought we were entirely immune to this kind of violence, but not long ago, the airport in Toronto was used in what increasingly appears to have been a similar act of violence, when an Air India jet crashed in the North Atlantic and another similar tragedy occurred at the airport in Tokyo, in connection with a plane coming in from Vancouver. This is not just an international problem, and I agree with the Secretary of State for External Affairs that it is a very difficult question and one that is becoming more and more apparent, even in Canada.
I am glad to see that the Minister of Transport (Mr. Mazankowski) is listening with the Secretary of State for External Affairs, because two Canadian lives were lost on the island of Malta on the week-end. However, only a few months ago, a very large number of Canadians lost their lives in the North Atlantic. The impression now seems to be that the disaster was even worse than a hijacking, since there were ammunition and explosives on board the Air India plane.
Of course, international action is extremely important. We must pursue the policy of refusing to offer asylum to persons who resort to this kind of violence.

I think it is extremely important that asylum not be given to any of these people. When I was Minister of Finance and attended the Bonn Summit, we were already discussing this matter. We had a full session on international terrorism. I think we have succeeded somewhat in that there are now very
few countries, if any, which will welcome hijackers and give them asylum. It is of fundamental importance that people who get involved in these tragic events know that there is no place they can land safely anymore. I hope the lesson of last weekend will help to deter some people.
However, we must ensure that these people cannot get on planes anymore. I think that was the problem in Athens last weekend. That airport has been subject to many such incidents. I think we should put pressure on the Greek Government. Over the weekend some people in France were advocating that we should cut transportation to these airports by Canadian planes if Canadian citizens are to be safe. However, we cannot give lessons to anyone else if we are faced with the same problem in Canada. I know that the Government of Canada and the Minister of Transport (Mr. Mazankowski) will be dedicated to curing this problem which does exist in Canada. The other day there were some-


Mr. Speaker:: Order, please. I do this with great regret, but I think the Hon. Member knows that responses are to be approximately the same length as the original statement. I am going to ask the Hon. Member for Saint-Maurice (Mr. Chretien) if he could conclude briefly.


Joseph Jacques Jean Chrétien: Yes, I will conclude. I have made my point and everyone understood where I was going. 1 just want to say that this is a very serious problem. This is the type of issue on which we should work together, because loss of life should not lead to political confrontation. Therefore, let us find a solution in Canada as quickly as possible.


Pauline Jewett: Mr. Speaker, on behalf of the New Democratic Party I wish to join the Secretary of State for External Affairs (Mr. Clark) in expressing our very deep sympathy to the family and friends of Mrs. Leonard and her infant son who lost their lives in this very great tragedy. As the Secretary of State for External Affairs (Mr. Clark) said earlier today, we cannot second guess the wisdom of the Egyptian decision, nor should we now assume that all the blame should rest on the Athens airport. There is nothing conclusive about that and 1 was distressed to hear such a suggestion.
At the same time, as the Minister has noted, we must make an urgent and concerted international effort to find solutions to this horrendous problem of international terrorism. At the close of his statement, the Minister said that we will be acting with our friends and allies. Since I do not know how broad that phrase is, I hope he also means that we will be acting with all members of the United Nations who are concerned about the very great growth in international terrorism.
1 will discuss with my colleagues the possibility of striking a subcommittee of the Standing Committee on External Affairs and National Defence to assist the Minister in this matter in any possible way.
November 25, 1985


INDIAN AFFAIRS
David Edward Crombie: Mr. Speaker, I am pleased to advise the House that an agreement has been reached to settle finally the mercury pollution claims of the Grassy Narrows and Islington Bands in northern Ontario. I am sure that all Members will be as delighted as I am that today, 15 years after the discovery of the mercury pollution in the Wabigoon and English Rivers, this Government, the Province of Ontario, Great Lakes Forest Products Limited, Reed Incorporated and the two Indian communities can all say that we have achieved a settlement that is fair and honourable.
Sixteen million six hundred and sixty-seven thousand dollars will be provided in compensation to the two bands. Of this amount, Canada will provide $2.75 million, Ontario will contribute $1.66 million, $6 million will come from Great Lakes Forest Products Limited and $5.75 million from Reed.
This money will be transferred to the bands, to be used for purposes of social and economic reconstruction. Two million dollars of the total will be paid into a special fund to compensate individuals with health problems attribuable to mercury poisoning. This fund will be administered by a board appointed by Canada, Ontario and the two bands.
Many individuals, representing all the parties, have played an important part in hammering out this agreement. However, let me pay special tribute to my own representative, the Hon. Justice Emmett Hall. When I appointed him to act as my special representative in this matter, negotiations were at an impasse. Justice Hall shouldered an immense burden and acted with complete conviction to work out an agreement acceptable to all parties. I say this, not to detract from the role of the other negotiators, but to indicate my own personal profound gratitude to Emmett Hall, who, at the age of 87, has now yet another accomplishment to add to his distinguished career.
Finally, I want to say to the Indian people in those communities that we know the hardship and despair that they have experienced during the past 15 years. I and many Canadians have felt shame that situations like these could develop in our midst. We do not forget those 15 years, but we do celebrate a new beginning, a new future for these, our first citizens.


Some Hon. Members:: Hear, hear!


B. Keith Penner: Mr. Speaker, it was in the period from 1963 to 1970 that approximately 10 tons of mercury were dumped into the Wabigoon-English-Winnipeg river system from a chlor-alkalai plant, part of a paper-mill complex at Dryden, Ontario.
This mercury was absorbed into the biota of the river system, rendering fish in the river system unfit for human consumption. The Indian people at Whitedog and Grassy
Statements by Ministers
Narrows who had worked as fishermen and tourist outfitters lost their jobs.
Grassy Narrows, an Ojibway Indian village, had to be relocated. A traditional community was transformed into one which was programmed to self-destruct.
Joblessness and pollution led to horrendous economic and social disintegration and health problems. The communities of Grassy Narrows and Whitedog became pathological places with alcohol and drug induced violence, child abuse and a large number of children who were taken into care by the Children's Aid Society.
It is essential to note that the horror and death were not the tragic norms before the river was poisoned. It happened after.
As far back as 1977, the Grassy Narrows and Islington Bands initiated legal action seeking $25 million in damages. The settlement which has been announced today will probably be accepted and I certainly want to commend the Minister and his special negotiator for the work they have done. Of course, it has yet to be ratified by the band members of Grassy Narrows and Islington, but I think all Members and the Minister himself will agree that this money can never replace all that has been lost.
Is $16 million really fair compensation to a people who have been deprived of their livelihoods, their pride, their self-determination and their self-sufficiency? The compensation package will certainly help to alleviate much of the pain, but can it restore the loss of hope? That remains to be seen.


John Edmund Parry: Mr. Speaker, I and I am sure all Members of the House and the vast majority of Canadians join the Minister in welcoming the settlement which he has announced today. Yet the overwhelming sentiment with which I am left is one of amazement that an injustice of such proportions and such devastating effect was allowed to persist for such a period of time.
The fact that it took 15 years to reach a settlement with the bands for the injuries done to their people, of whom scarcely a family or person was left untouched, is something which will remain as a stain on Canada's record both in environmental and human terms. I am saddened to see today that these bands are not clear of further threats from the environment. They are not clear from the threat of possible PCB pollution from the possible siting of a PCB storage dump near to the water course that brought them the original tribulation of mercury pollution.
I am glad to see the Minister of the Environment (Mr. McMillan), in a speech only last week, recognized that corporate polluters will continue to try to get away with activity in Canada that would not be permitted in other jurisdictions.
The nature of the injustice done to the people of the Islington and Grassy Narrows communities was cataclysmic. It was poisoning that led to a complete disintegration of the social fabric of those communities. This has been well documented in a couple of books which many Members of the House will have read. The relocation, the social fragmentation

November 25, 1985
Petitions
and the break up of the clans are well documented. The social and human losses were further aggravated by the economic losses which the bands suffered.
As the Hon. Member for Cochrane-Superior (Mr. Penner) points out, money cannot bring back the way of life that those people enjoyed before this pollution took its terrible toll. I believe money is best left uncommented upon because only time will tell if the compensation has been in any way adequate. However, I should note that the figures provided to the Minister do not add up. There is half a million dollars unaccounted for.
As I said, the health problems were enormous and I am glad to learn that the Province of Ontario has given its commitment to top up the original fund of $2 million, once it has been depleted by claims of residents of those communities for the injury done to their health.
I would be remiss if I did not recognize John Olthuis and Bruce Crofts who worked on behalf of these bands for many long dedicated years and who put so much of themselves into this final solution, as we hope to see it.
I would also recognize Chief Arnold Pelly of Grassy Narrows and his many predecessors, particularly Simon and Steve Fobister, as well as Chief Roy MacDonald and his predecessors of the Islington Band at White Dog Falls for the efforts they have made. Above all I should recognize them for keeping the coherent efforts and commitments of their communities in working toward a solution when the frustration and exasperation which they felt might so easily have deteriorated into action against society and against those who inflicted injustice on them. I am glad to see that we are taking the first steps to correct this historic injustice.
I am sad to see that in many ways the Indian people continue to have second-class treatment from our society, though I do not allege it is on the level of what was inflicted upon the two bands.
When we see communities without the services which all of us take for granted, a community such as that of Lubicon Lake which does not have a land base, and communities such as Shoal Lake where economic development is stymied by the failure of the Government to live up to the previous Government's commitments, then we must acknowledge that there is still work to be done.
I am glad, therefore, to recognize this settlement and to add my Party's support of it.


Some Hon. Members:: Hear, hear!


PETITIONS
Aideen Nicholson: Mr. Speaker, I have petitions here signed by residents of Ottawa and also signed by
some public health nurses working in my riding in Toronto. These people are calling for the withdrawal of the deindexation of family allowances. The nurses point out that for many of the welfare families with whom they deal, family allowance money provides food for the last one and one-half weeks of the months.


Derek Nigel Ernest Blackburn: Mr. Speaker, I have two petitions, one from the University Women's Club of St. Catharines and another one signed by several persons in southwestern Ontario. The operative sentence in the petitions is "wherefore, the undersigned, your Petitioners, humbly pray and call upon the House of Commons to reinstate full indexation of universal family allowance and to rescind the unfair tax increases".


Mr. Jim Manly (Cowichan-Malahat-The Islands):: Mr. Speaker, I have petitions from residents of the Nanaimo-Alberni riding concerned about the Canadian Forces maritime experimental and test range at Nanoose Bay, concerned about the United States of America's policy of neither confirming nor denying the presence of nuclear weapons on board U.S. vessels and urging that there be a full public inquiry before the present agreement is renegotiated.


James Douglas Manly: Mr. Speaker, I have petitions from residents of Cowichan-Malahat-The Islands who are concerned about the family allowance deindexing proposal of the federal Government. They point out that this places an unfair burden upon low-income families, especially when coupled with the tax increases, and the unfairness of this is compounded when it is put side by side with the tax benefits made available to corporations and wealthy people. The petitioners call upon the House of Commons to reinstate full indexation of universal family allowance and to rescind the unfair tax increases.


Nelson Andrew Riis: Mr. Speaker, it is my pleasure to present a petition on behalf of a number of residents who are concerned about the deindexing of family allowance, particularly when you put it on top of the sales tax increases, the increase in excise tax and other stiff income tax increases. They are asking the House of Commons, particularly the Government of Canada, to reinstate full indexation of universal family allowance and to rescind the unfair tax increases introduced in the last Budget.


Geoff Wilson: Mr. Speaker, I have a petition from a number of residents of the Trail subdivision in the City of Swift Current, Saskatchewan.
November 25, 1985

They protest the lack of door to door mail delivery to their area and ask this House to address their concerns.


Mr. Vic Althouse (Humboldt-Lake Centre):: Mr. Speaker, 1 have petitions from senior citizens clubs in LeRoy, Lanigan and Spalding protesting the effort by the Government to deindex the family allowance similar to what the Government tried to do to senior citizens pensions some time ago. They point out that the cut-backs are inequitable and unbearable in the face of budget hand-outs, such as half a million dollars in tax free capital gains taxes, greater RRSP deductions for high income recipients, millions in hand-outs to oil companies and billions of dollars in bail-outs to the banks.
*****


Mr. Speaker:: May I inform the House at this time that because of the ministerial statements, consideration of Government Orders will be extended by 19 minutes today.



CONFLICT OF INTEREST


Ramon John Hnatyshyn: Mr. Speaker, there have been the usual consultations between the Parties. I think you will find a disposition at this time, by unanimous consent and without debate, to allow passage of the item of business under Government Order No. 60 standing in my name. I move:
That the Standing Committee on Management and Members' Services consider matters related to the establishment of a Register of Members' Interests, and report on these and any other matters relating to registration of Members' interests, including the form and content of such a register, considering among other matters relating to the registration of Members' interests, the following:
(a)	remunerated directorships of companies, public or private;
(b)	other remunerated positions or offices;
(c)	remunerated trades, professions or vocations;
(d)	the names of clients when the interests referred to above include personal services by the Member which arise out of or are related in any manner to his or her membership in the House;
(e)	any payments or any material benefits or advantages received from or on behalf of foreign Governments, organizations or persons;
(/) land and property of substantial value or from which a substantial income is derived; and
(g) the names of companies or other bodies in which the Member has, to his or her knowledge, either himself or herself or with or on behalf of his or her spouse or dependents, any beneficial interest including-among others, share-holderings-of a nominal value greater than one-hundredth of the total capital assets of the company or other body;
and that it report on the form and content of such a Register not later than December 31, 1985; and
Provided, that notwithstanding the usual practices of this House, if the House is not sitting when the final report of the Committee is completed, the Committee shall report its findings by depositing the said report with the Clerk of the House and it shall thereupon be deemed to have been laid upon the Table.
Order Paper Questions


Mr. Speaker:: The House has heard the terms of the motion. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Ramon John Hnatyshyn: Mr. Speaker, the following question will be answered today: No. 266.


Mr. Young: 1.	Did the Minister of National Health and Welfare receive a report from the Canadian Council on Social Development with respect to a study on the cost effectiveness of providing alternatives to the institutionalization of mentally disabled persons and, if so, was there a dissenting opinion to the majority report and what was the nature of that opinion?
2.	Does the Minister intend to initiate a pilot project to determine the cost effectiveness of providing comprehensive services to assist mentally disabled individuals to participate fully in their communities and, if so, in which community or communities will such projects be initiated and what will be the commencement and completion dates?


Hon. Jake Epp (Minister of National Health and Welfare):: 1. The Canadian Council on Social Development (CCSD) has submitted to the Minister of National Health and Welfare its report on a cost effectiveness study of providing alternatives to the institutionalization of mentally disabled persons and a dissenting opinion to the report was not submitted.
2. No decision has yet been taken with respect to pilot projects.


Ramon John Hnatyshyn: Mr. Speaker, I ask that the remaining questions be allowed to stand.


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


Some Hon. Members:: Agreed.

November 25, 1985
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GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the Motion of Mr. Tardif (Richmond-Wolfe):
That this House regrets that the Prime Minister has once again broken an election campaign promise, this time by failing to maintain quotas on imports of shoes and by compounding this betrayal by failing to make adequate provision for the thousands of workers whose jobs are adversely affected.
Michel Côté: Mr. Speaker, I resume my remarks where I left off this morning when I was talking about the impact of quotas on Canadian consumers. As I was saying, since quotas have given a monetary value to import permits, one can easily understand why those who have obtained such permits on the basis of their purchases in previous years would rather not use them to buy cheaper shoes. They will prefer to buy more expensive shoes to take full advantage of their limited number of import permits.
Undeniably this strategy serves the interest of importers, but it has a significant and undesirable social effect on the price of various categories of imported shoes. Since high-priced imported shoes bring in a higher shortage premium to begin with, importers have a tendency to buy more of them. They cannot do that unless they buy smaller quantities of cheaper shoes, because their import quotas are limited. In turn this reduced supply for buyers of cheaper shoes leads to higher prices on the domestic market.
Therefore the result of quotas is to lower the supply of cheaper shoes imported into Canada and increase their prices as compared with those of other categories of imported shoes. It is particularly detrimental to poorer consumers who are least able to afford them.
While it is hard to determine exactly the total costs of quotas to consumers, the research conducted on behalf of the tribunal shows how substantial they are. According to those reviews, since 1968, consumers have paid out between $450 and $500 million more than they would have had there been no such quotas.
Mr. Speaker, the quota system not only increases the price of shoes, both imported and Canadian, but also lessens the choice for consumers. Indeed, retailers cannot buy freely abroad because of those quotas and Canadian manufacturers are unable to offer items comparable with foreign production in all styles of footwear. In addition, price increases and restrictions in the variety and availability of shoes have probably helped reduce the total demand of shoes by almost 12 per cent since 1978.
This Government's new policy on quotas will phase out the costs incurred by Canadian consumers. This policy furthers their interests especially where low-income consumers are concerned.
Although some larger retailers benefited from the global quota regime, the retail sector as a whole was hurt by that policy, with the greatest competitive harm having been experienced by the small independent retail business segment.
To understand the impact of the global quota regime on the retail sector, one must keep in mind that quotas create product scarcity. Quota allocation is costly to obtain, and a quota regime introduces rigidity in the characteristics of product supplies. Because the cost of acquiring quota allocation is independent of the volume of imports, it represents a heavier burden for the small independent retailer and weakens his ability to compete. Because quotas create product scarcity, they force smaller retailers to offer a narrower product range than their customers wish, thus reducing the retailer's ability to compete and thereby diminishing the value of his investment. Because quotas introduce rigidity in the supply of imported product, retailers are unable to respond to changes in customer demand, thus reducing the competitiveness of both the retail and manufacturing sectors.
Because quota permits have been allocated mainly on the basis of historical import performance, new entry into the retail business has been discouraged artificially. Quota limitation also has a dampening effect on the ability of existing business to expand. Without the freedom to enter and expand or exit and contract, competitive forces do not work-


The Acting Speaker (Mr. Paproski):: On a point of order, the Hon. Member for Kamloops-Shuswap (Mr. Riis).


Nelson Andrew Riis: Mr. Speaker, I hesitate to interrupt my colleague halfway through his reading, but we have been here in the House in excess of a year and this is an opposition debate that is taking place. We have heard the Minister for International Trade (Mr. Kelleher) read a statement, and we are now hearing another Minister read a statement. There is a place for that. My recollection of the rules-


The Acting Speaker (Mr. Paproski):: The Hon. Member has been in this House for a long time and should know that his is not a point of order. If he would like to bring that matter up at another sitting, that is fine; but not at this time.


Michel Côté: Thank you, Mr. Speaker. Over-all, the net effect of quotas has been to increase the concentration in the retail sector and to reduce competition. Quotas have also had an adverse effect on employment in the retail sector. Restricted supply means fewer sales-and at higher prices, of course-and fewer sales means retailers need fewer stores and fewer employees.
November 25, 1985

The new policy combines some special measures of protection so that Canada will continue to incur some of these costs at the retail level. However, the new policy adds protection for about half the industry, and we can expect to achieve improved levels of competition and some expansion in the retail sector, particularly by smaller retailers.
Moreover, to further improve the competitiveness of this sector, the new policy will reduce the restraints on entry and expansion by allocating, wherever possible, new quota resources to those who do not enjoy quota rights.

Mr. Speaker, 1 should like, if you would allow me, to consider in greater detail the consequence of our decision on the footwear industry and show you why we believe that our policy will be beneficial.
In view of the state of this industry and of the substantial costs of the quotas for the consumer and the distribution sector, three basic questions arise: What were the reasons originally for imposing quotas in this sector? Have these quotas had the expected effect on the industry? Is extension of the quotas desirable? In other words, do the benefits for the industry justify the substantial costs for consumers and the rest of the economy? These are the three questions which 1 now want to discuss, Mr. Speaker, because I believe that they go to the heart of the matter.
As indicated this morning by my colleague, the Minister for International Trade (Mr. Kelleher), footwear import quotas were first imposed in 1977 under Clause 19 of the GATT. This clause provides that a signatory country may, in an emergency, impose comprehensive quotas on the import of certain items when these imports cause or threaten to cause serious prejudice to a national industry. It is generally agreed that this protective measure must be temporary and not last any longer than necessary to enable the national industry to adjust to international competitive forces. At no time is it provided that the quotas can become a permanent protective measure. It is generally estimated that the adjustment process should normally last three years. As you are aware, Mr. Speaker, the footwear industry has already enjoyed eight years of protection, and some of the Members opposite would like this protection to be extended for at least five more years. In view of the considerable costs of such a protection for consumers and the Canadian economy as a whole, we have to ask ourselves, as we have in fact done, Mr. Speaker, whether it would truly be in the interests of all Canada to extend these measures, which risk becoming a crutch for the industry. If this industry has adapted to market conditions, protection is no longer necessary. If it has not yet adapted after eight years, we have to wonder whether it will ever adjust or whether quotas really are the appropriate remedy.
In the light of testimonies given during the public hearings held by the tribunal and of the conclusions of its analyses, the
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answer is clear. The industry has indeed adjusted, but it has done so in spite, rather than because of the quotas.
My time is getting short, Mr. Speaker. To conclude, I first want to summarize the main findings on which the policy of our Government is based. First, we noticed that the extended quota period which the industry has been enjoying since 1977 imposed considerable costs both on the Canadian consumer and on the Canadian economy as a whole. Secondly, it is clear that the quotas brought only meagre benefits to the Canadian consumer and that they slowed down the necessary restructuration in the industry instead of making it easier. Finally, there is no doubt that the extension of the quotas could only perpetuate those costs and delay all the more the required adjustments.
The conclusion to be drawn from these findings is clear, Mr. Speaker. Even without considering our international obligations and the substantial cost of the retaliation measures our partners threatened to use, it is clearly in the interests of the country as a whole to eliminate as quickly as possible the present quota system. This is both a matter of economic sense and of social justice.
Mr. Speaker, our decision on this question is an essential element of the Agenda for Economic Renewal of the Government. It illustrates our determination to adopt a structural adjustment policy taking fully into account the crucial role of international trade in the Canadian economy and the interest for Canada to work together with its trading partners to gradually eliminate tariff and non tariff barriers which hamper international trade and penalize the most dynamic elements in our economy.


The Acting Speaker (Mr. Paproski):: Questions or comments; the Hon. Member for Richmond-Wolfe (Mr. Tardif).


Alain Tardif: Mr. Speaker, first of all, I would like to draw the attention of the House on the most unusual fact, I believe, that the two Ministers, in speaking on behalf of the Government, made almost identical speeches. I have reached the conclusion that both statements had probably been written by the same civil servant.
Having said this, I would like to come to my question: The Minister's speech, as well as his colleagues, has an amazingly ambiguous flavour. You seem to be saying, and you are indeed saying in a way that there won't be any adverse effect as the industry is now able to face the competition. This is a point of your argument which you rest on and supposedly confirm through the antidumping report. On the other hand, you say that should there be adverse effects . .. Listen, it could happen, should there be adverse effects, support measures will be taken to help the men and women who will lose their jobs. Am I to understand that you made that decision without knowing, without assessing, without quantifying its impact in terms of
8774

November 25, 1985
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employment? And here is one last question: If within a year it appeared that your decision caused thousands and thousands of people to be laid off, would you agree to review that decision on the basis of the fact that it had indeed a very severe impact on the workers and industry in Canada?


Michel Côté: First of all, Mr. Speaker, I should like to reply to my hon. friend that we felt there was indeed a possible injury to Canadian consumers. I should like also to indicate to him that this economic tribunal which was created a year ago has received over 72 reports, heard over 39 appeals and representations and come to the conclusion that there exists a part of the industry which has been fully renewed and which has adapted to international competition, but that another part of the industry still needed protection. Mr. Speaker, Hon. Members are aware that under the GATT agreements, no protection can be granted to an area of activity unless there is evidence that there exists a need for protection; otherwise, we would be faced with absolutely devastating consequences.
So the Government has decided to accept the recommendations of the economic tribunal again in the best interest of Canadian consumers, and that is what I tried to establish in my remarks by emphasizing the benefits for Canadian consumers.
Mr. Speaker, I suggest that on the whole and in the future, this decision and its impact will clearly benefit Canadian consumers who, because of the quota system, had been in the past at the mercy of rising prices, and who will from now on have access to a wider variety of shoes of better quality at a lower price. Because we should not overlook the fact that the cost which these quotas represent for importers is passed on to Canadian consumers in a sector of higher priced shoes. Canadian consumers, therefore, could not buy the cheaper shoes because, not being imported, they were not available on the Canadian market. It has been established and I think that studies have clearly demonstrated that these quotas had a yearly impact of between $80 and $85 million on Canadian consumers. As a Conservative Government, we feel that these measures must be changed again for the benefit of Canadian consumers.


Steven W. Langdon: Mr. Speaker, both this Minister and the Minister who spoke this morning put forward an argument which suggested that quotas were being kept for those parts of the industry that had not yet modernized or received Government help for restructuring and that the quotas were being eliminated for those parts of the industry which had received such restructuring help. I would like to make a brief comment before I come to my question and point out that first, the tribunal report itself does not talk in those terms at all. Its reasons for making the exception for women's and girls' shoes have nothing to do with the question of whether or not modernization has taken place. The tribunal makes it quite
clear that the substitutability factor is of greater significance in that case.
I would also like to note that we have been able to receive data from all the Quebec firms in the footwear sector which have received assistance from the Canadian Industrial Renewal Board up to the end of 1984. There is a total of 10 such Quebec companies. Four of those companies are exclusive producers of women's shoes. The other five companies produce combinations of men's and women's shoes. The suggestion that somehow the industry had been helped with respect to men's and boys' shoes but not with respect to women's and girls' shoes and therefore the distinction was kept is simply not accurate. In fact, the Government has made a decision which has abandoned the shoe sector, parts of it a little faster than others, because of a commitment to ideological purity rather than to economic common sense.
In making this decision, did the Cabinet and in particular the Minister who has just spoken look with any kind of seriousness at the paragraph contained in the report of the import tribunal which tells of what took place in the United States when quotas were removed from shoes in that country? I would quote from page 33 of the report of the tribunal as follows:
The U.S. experience following the removal of orderly marketing arrangements in 1981 shows that manufacturiers, in the absence of important restraints, have greatly expanded their imports. This might have happened in Canada as well if quotas had not been imposed. Thus the benefits of quotas to domestic production may be underestimated if quotas have, in fact, prevented a major shift towards imports.
I put it to the Minister and the House that that is what we in Canada will face. We will face a massive explosion which will force the Government into ignominious retreat in six, eight or ten months' time. It will force the Government to impose these quotas again. I simply hope that the red faces and the sense of shame that will be apparent at that point will somehow make up a little bit for the thousands of lives which will have been damaged in the intervening period.


Michel Côté: Mr. Speaker, we did not create that tribunal, the former Government created it and gave it a special mandate. Let me quote a part of that mandate which reads as follows:
-in the event of a determination of injury or threat thereof, recommend a formula by which the special measures of protection could be phased out through a progressive liberalization process covering a period of not more than three years, by which time the Canadian industry would be required to face international competition without special measures of protection.
They were temporary measures which were put in place eight years ago. The tribunal made its recommendation by stating that a sector of the industry has been able to come to a point where it could meet the competition but that only part of it need be protected. As the tribunal says, this protection could not go beyond three years. Obviously, we gave all benefit of the doubt to this sector. We hope that it will come to a point where it will be in a position to compete on an international basis in three years.
November 25, 1985


The Acting Speaker (Mr. Paproski):: Order, please! The time allocated for questions and comments is now over.
I now recognize the Hon. Member for Spadina (Mr. Heap). [English]


Daniel James Macdonnell Heap: Mr. Speaker, I am pleased to have an opportunity to support this motion from the Liberal Party which is condemning the Government for breaking the promise of the Prime Minister (Mr. Mulroney) when he promised shortly before the last election that he would not take off the quotas on the footwear industry. The Government chooses to get into an argument about whether it was really the previous Liberal Government that caused the problem or not. I am not interested in trying to sort out how much each of those two Governments was responsible for.
What I am concerned about, Mr. Speaker, is that the decision of this Government, which was a free decision, it was not in any way compelled or constrained, they had their options, as all other Governments do, including the Governments of countries like Taiwan, which sells shoes here but forbid us to sell shoes there, they had their options and they chose to cut off most of the quotas and thereby they chose to cut off an unknown number of jobs. It has been estimated that as many as 10,000 jobs will be lost. We don't know certainly, but we do know that when the previous Liberal Government four years ago cut the quotas off, within three or four months
3,000	jobs were lost. I remember the present Minister of Public Works (Mr. La Salle) when he sat on this side of the House making that very complaint. I wonder how he is going to feel now when thousands of jobs are lost by the action of a Government of which he is a member.
We have heard an estimate that the quotas have cost the consumers $500 million. That is an estimate. There is another estimate that removing the quotas will cost the consumers $800 million in lost jobs and benefits because most of them were not top-paid workers but reasonably well-paid workers. Unemployment insurance, welfare payments and, of course, lost taxes will represent a great loss than is estimated for the cost of having the quotas on. They are both only guesses, Mr. Speaker. What is at stake here, as my colleague has said, is really the doctrinaire conviction of this Government that it should give all the benefits to the entrepreneurs at the expense of those who have to live by their wages and salaries.
The injury has already begun. We have people saying there is no injury expected to the industry but the injury has begun. I pointed out two or three weeks ago that several thousands jobs have already been lost in this industry in Ontario and Quebec because buyers have held off buying in anticipation of this decision by the Government. Therefore, we have already lost jobs and we will lose more jobs now.
The tribunal report is quoted and yet the tribunal report acknowledges on page 42 that the decrease in domestic production in the face of increased import competition-they
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already said there would be a surge-may be expected to be significant. Farther down they say the dislocation associated with this process of adjustment will be severe in the case of those enterprises and those employees directly affected. There are many other places in which the tribunal acknowledges that there is going to be injury. It is therefore frivolous of the tribunal report to say in its recommendations there will not be and of the Cabinet, the Government, to say there will not be.
The tribunal report also shows something else quite interesting, that is that the quotas were so mishandled and so misconceived under the previous and present administrations that they benefited the large importers and some of the large retailers chains such as F. W. Woolworth under the name of Kinney more than they benefited the producers they were intended to benefit.
This will continue, Mr. Speaker, even without the quotas. What happens is that the importers may mark up 100 per cent a pair of shoes that cost $15 to make in Canada. They may be sold for $30, the mark-up going to the trade, the commercial end. However, on a pair of shoes made abroad for $7 and also sold for $30, there is an extortionate mark-up, a mark-up of $23 instead of $8. That is where the consumers may be losing. In fact, Mr. Speaker, the tribunal report shows that the footwear industry has done better than average of Canadian industry of keeping its manufacturing costs down. Between 1974 and 1983, the total economy moved from an index of 132 to 290, whereas the footwear productivity and prices moved from 133 to only 262. The footwear producers were more efficient than the total economy of Canada and more efficient than manufacturing. That went up to 298. Whereas they started at 132, 138 and 133, the total economy went to 290. Manufacturers went to 299 and footwear went only to 272. Therefore, it is not the manufacturers who have been gouging the consumers, it is the importers, the very ones who are holleryng for the end of the quotas. The recommendations of the tribunal and the decisions of the Cabinet simply do not fit the facts that even the tribunal admitted.
I want to go into a much more serious matter, one that the tribunal seemed to take no interest in whatsoever. Three-quarters of the imports into Canada last year came from five countries. Out of 53 million pairs, Taiwan sent 17 million; Italy, nearly six million; South Korea, over 11 million; Hong Kong, over three million; and Brazil, over three million. That is three-quarters of the imports. We are told we have to be competitive and this is where the tunnel vision, the dogmatism of this Government, is disastrous for Canadians.
Taiwan is a country in which the Government is ferociously anti-labour. When 1 visited there two years ago I talked with clergy who had been in jail several times for the crime of trying to help workers organize unions. Taiwan is a low wage country. Hong Kong is another low wage country, not as low as some others in the Pacific but still relatively low. Brazil is a low wage country. In many of these countries, Mr. Speaker,

November 25, 1985
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the average wage for producing shoes is about 70 cents, one-tenth of the average wage in Canada. Seven dollars, the average wage in the footwear manufacturing industry, is not an extortionate amount of money. If the worker brings in $14,000 a year gross, he is not living high off the hog but he might be above the poverty level. To cut him to one tenth of that, 70 cents, which is the Government's idea of competition, would ruin not only those workers but much more of Canada.
I have not mentioned Italy. I have referred to the bad labour conditions in many of the countries in the West Pacific. Italy, of course, is a European country and we may suppose that, therefore, the labour conditions there are comparable to the labour conditions in Canada. They are not. I quote from the Anti-Slavery Society for the Protection of Human Rights in its report for 1980 to the United Nations Working Group of Experts on Slavery. In its opening statement it states:
When you buy your next pair of shoes stamped "Made in Italy" spare a thought for the thousand of child workers of Aversa, near Naples who most likely helped stitch, glue and finish them, in conditions which would have been entirely familiar to Charles Dickens.
Child labour is a growing trend, according to this document. It is fundamental to the organization of production and profits within the contemporary Italian economy. The children who were interviewed by representatives of this society started working from the age of 10 and up. Most children were working a six-hour day although in some cases they worked more than nine hours. All children worked a six-day week and all were poorly paid. The children's weekly earnings ranged from 7,000 lire to 15,000 lire per week, and thus always fell far short of the basic legal minimum wage paid to adults which is 75,000 lire per week.
It is reported that as adult unemployment rises in Italy, the employment of children at a small fraction of adult wages is also rising. The conditions of work are very severe and health hazardous. The society quotes one of the child workers as saying:
The place where 25 of us worked was 10 metres by 2.5 metres high and it was impossible to breathe because of the glue fumes. Our cloakroom was a tiny room in which the gum and solvents were also stored; when work was over and we went to get changed, we would find our clothes damp, cold and reeking of gum.
Italy is a civilized country. We have to ask ourselves, are there no laws? The answer is, of course, that there are laws. The report of the society states, and I quote:
-the enforcement of the legislation protecting children is in the hands of the Labour Inspectorate: its effectiveness is handicapped, for it is understaffed and overburdened with work. According to Dr. F, Coppola (Departmental Head of the Provincial Inspectorate of Labour, Naples) in Naples up to 1975, four officials were allocated exclusively to the child labour sector.
The report continues:
-the position is summarized by Neapolitan journalist Eleanora Puntillo: "In my opinion there is no point in talking about legislation. When the law is so systematically and widely infringed, it is as if it did not exist".
What about the international labour organization and its conventions? The fact is that Italy has not yet ratified the ILO Convention No. 138 on the Minimum Age for Admission to Employment.
We are talking about competitiveness. We are not talking about a Third World country coming out of starvation. One of the oldest developed countries in Europe, Italy, is using the labour of children for as much as six hours or more per day, six days a week, paying about one fifth of the minimum wage for adults. It is using these children in conditions which none of us would want to see our children endure even if we were willing to take them out of school at the age of 10 to send them into the factories. Some of these conditions are deadly. I quote again from the report of the Anti-Slavery Society:
-the extensive use of poisonous glues in the cramped conditions of the leather workshops is a major health hazard and liable to cause glue polyneuritis. This is a disease caused by poisoning from toxic substances within glue vapour; it affects the nervous system causing paralysis of the joints, disability and muscular pains accompanied by cramp and swelling. Untreated, the disease can result in death. Over 25 per cent of the workers affected are under fourteen and although there have been several cases of glue polyneuritis over the last five years, it is still not treated as an industrial disease.
Those are the competitive conditions which this Government is asking us to match of a country where the police smash and jail trade union organizers such as in South Korea, of a country where 10-year-old children are forced to leave school in poisonous atmospheres so that it can sell cheap shoes abroad. If our Government wants Canadians to take their children out of school, not just to do work at home because that is already happening in Spadina and in some parts of Montreal, but to go into the factories and into the sweat-shops, as happened 200 years ago in Britain, then the Government will find itself alone in Canada because Canadians do not want that. Canadians are willing to pay a decent price to get a decent wage.
Recently, the Ontario Federation of Labour sent a telegram to the Prime Minister saying: "As the representative of 800,000 Ontario workers who are also consumers, the Ontario Federation of Labour opposes strongly the removal of import quotas for shoes and footwear. To remove the quotas is not only to jeopardize thousands of Canadian jobs but to subject consumers to the whim of foreign producers. Canada needs its own footwear industry." Very few of those 800,000 workers in Ontario work in the footwear factories of Spadina and Guelph and the other cities of Ontario. All the other workers agree, as workers and consumers, that we need to have our own footwear industry where we, as Canadians, can be responsible for the health conditions, for the wages and for the minimum age at which people can be economically compelled to go to work. The issue is much wider than Ontario. A few weeks ago there was a poll by Decima. One of our colleagues today was concerned about polling being done by an American firm. This, I believe, is a polling outfit which is used by the Government and I trust it is Canadian. The Decima poll finds
November 25, 1985

that 80 per cent of Canadians are willing to pay the prices for shoes necessary to enable the Canadian industry to survive. It was a multi-question poll. For example, a total of 66 per cent consider that import competition is a very serious threat to the Canadian footwear industry. Sixty-six per cent say that the Government should protect Canadian jobs with quotas. The numbers vary throughout between 66 per cent and 80 per cent. That is a poll which represents not Ontario only, not Quebec only, but all of Canada.
A phoney crisis has been created by the shoe importers with their extortionate mark-ups of 300 per cent or more. It is the same in the garment industry. I have gone to a store to buy a sweater and on the same rack there are sweaters from Taiwan, Canada, Germany, United States and other European countries. They are identical and they all sell for the identical price. They are now trying to blame that on the manufacturers. The same sort of situation exists in the footwear industry. In effect what they are saying is: Cut wages. I visited Chile this summer where the Government did the very same thing. Our ambassador told us that the Chilean Government was right to cut the wages of the Chilean people so they could compete, and that Canada must do the same thing. Their competition has been so successful that Chilean workers must now produce three tonnes of copper in order to earn as much money as they did for one tonne of copper five years ago. We do not prosper by cutting our wages so as to force other countries to do the same thing. Therefore, I ask the Government to seriously reconsider the disastrous road it is going down, look at what is happening in Chile, Italy, Taiwan, South Korea and Brazil, and stay away from wage cutting which is what this quota cut really means.
DOT]


Jean J. Charest: Mr. Speaker, I rise in the House today to speak to the Opposition motion because it deals with a matter that is very important to the region I represent and to my particular riding.
In the Eastern Townships there are many industries in the so-called traditional sectors-textiles, clothing and footwear- and these have existed for a number of years.
Since these industries were first established, we have experienced a number of disruptions in our economy, culminating in the 1981-82 recession which had an absolutely devastating impact on this region.
At the time, the parties concerned ordered a study by the Gaucher-Pringle company, which reached the conclusion, after a survey of the region's economy, that although the industrial base was more or less diversified, the number of jobs in the traditional sectors-textiles, clothing and footwear-tended to outnumber those in other industries, in other words, although there was a range of various types of industries, jobs tended to be concentrated in the traditional sectors. Needless to say, the
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shoe quota issue and the whole matter of import quotas for textiles and clothing has always been a matter of concern in the Eastern Townships, and especially in Sherbrooke and the surrounding area.
That is why I am making an exception today, because, as Hon. Members are aware, as a rule I do not rise in the House, out of deference to the Chair, to you, Mr. Speaker, and to all the Members of this House, and I am making this exception because the question before the House today is so important that I feel I must rise to speak on behalf of those who elected me as their representative here in Ottawa.
Mr. Speaker, I shall, if I may, give a short history of the quota system, as many others have done before, but I shall be very brief. We in the Eastern Townships, like other regions in Canada, have had shoe quotas since 1977, except for a period of eight months when they were suspended by the previous Liberal Government, and these quotas will be in effect until November 30 of this year. I would like to emphasize that point because I think it is important. Earlier this morning my colleague from Richmond-Wolfe (Mr. Tardif) referred to that situation and said he was proud of the fact that he and some of his colleagues had openly defied their own Government. Well, there is one thing he forgot to say this morning, as someone has already pointed out, and I would like to refresh his memory once again. The fact is that the then Liberal Government had lifted the quotas despite a favourable decision of the Canadian Import Tribunal, unlike the situation at this time. It was the other way around: the tribunal had ruled in favour of maintaining quotas, but the then Liberal Government went right ahead and abolished them. In that context, I would suggest that the Hon. Member for Richmond-Wolfe and those of his colleagues who had the courage to face the facts did the only thing they could do as representatives of their regions. Considering how unfair the situation was, I think they probably took the best course under the circumstances. In any case the Government changed its mind after eight months and finally adopted a quota policy.
Since then, Mr. Speaker, the man who was Leader of the Opposition at the time came to Sherbrooke in May and had to say clearly where he stood with respect to footwear and textile quotas. His position was that his Government would not tamper with quotas.
Eventually, in June 1984, the previous Liberal Government once again asked the Canadian Import Tribunal for a study and, in June 1985, the CIT made its recommendations and then the Government took action.
I believe that, in this context, it is essential to re-evaluate or re-examine the motion introduced by the Hon. Member for Richmond-Wolfe. To be even more specific, Mr. Speaker, we must not forget that most of the workers in this industry-I have the feeling that I am repeating myself, but I think that this should be repeated if we really want to understand the problem-are older than the average and the majority of them

November 25, 1985
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are women, in most cases with little education, often because they did not have the opportunity to attend school very long. In the Eastern Townships, we often see people aged 42 or 43 in these industries because they have had to start working very young to support their family. In view of the situation, it is silly to concentrate on a single aspect of the problem when we are speaking about these issues, whether we are dealing with the footwear, the textile or the clothing industry. All aspects should always be considered if we sincerely and honestly want to solve the problems which exist in these traditional sectors. We must never forget that this issue involves our regional development policy. The issue also has an extremely important social aspect in the case of the workers whom I have already described. There is also the whole context of international competition from imports.
Mr. Speaker, to come back to what the Gaucher-Pringle report said at the time, it was necessary to get out of these sectors, to diversify into much stronger industries, and the situation is the same here as elsewhere. The report also mentioned high technology and the fact that something had to be done to stop the region as a whole from depending completely on traditional employment sector.
Mr. Speaker, as most Members of this House, I believe, I was fascinated by the reaction which followed the decision made by the Government, and 1 would like to examine this reaction briefly. The Manufacturers Association squarely stated that it would mean the death of the industry. As for the Retailers Association, its members agree with the decision, they approve of it and some of them even go further. Even after the announcement of the decision made by the Government, certain retailers believe that the Government will do more, and I would like to quote from an article in The Globe and Mail of Thursday, November 21, 1985:

A spokesman for the Canadian Importers Association said he is afraid that the Government may have a hidden agenda that will see the inevitable surge in imports following the end of quotas used as an excuse to slap them on once again.

The Consumers' Association of Canada, on its part, agrees with the decision. If we look at our trading partners, we see that the Americans who supply only 4 per cent of the shoes consumed in Canada and the European Economic Community which accounts for 60 per cent of our imports of ladies and girls shoes, indicated that they intend to retaliate. In this context, Mr. Speaker, the motion of my hon. colleague and the reaction of the Official Opposition did not surprise me. On this side of the House, we are used since September, since November 1985, since we are sitting, to seeing the opposition Parties systematically take views opposed to ours. Frankly, we are sorry to see them contribute so little to this debate. Today's situation is not uncommon. They are only doing what they have always done. In this regard, Mr. Speaker, I would like to
draw your attention on the reaction of editorialists, because it is even more interesting.
Frederic Wagniere, in the Thursday, November 21 issue of La Presse, says:
Finally, Ottawa has decided to save the Canadian shoe industry.
And he concludes:
Ottawa is only taking a decision which is in the interest of the whole country and it is now up to the shoe industry to stand up on its own without any help from the Government or the consumers.
In the Friday, November 22 issue of The Gazette, we read:
But the government made the right decision, hard though it was.

Also in The Gazette dated November 22, Don McGillivray, political analyst for Southam News, was writing:

The Tory government has done the right thing-and a brave thing-in deciding to phase out shoe import quotas.

In The Ottawa Citizen dated November 22, it was stated: [English]
But abolishing footwear import quotas will benefit consumers-and the industry itself.

In The Gazette dated November 23, Marie-Josee Drouin, a respected and well-known economist, also wrote that the Government has made a sound decision.
Mr. Speaker, I respectfully summit that there must be something unusual because the Canadian Manufacturers' Association has said publicly: This will be the death of the industry. Consumers think that we have made a fine decision. On the one hand, all the editorials which we have read until now say that it is a good decision. On the other hand, the unions say that it is a bad decision which will kill the industry.
I think that all the Members of this House, under these circumstances, should ask themselves serious questions. How is it that on one single issue, people can hold so divergent views? I for one, Mr. Speaker, do not pretend to know everything from instinct, but I will honestly and sincerely say that the decision made by the Government, if I only consider the interests of my riding and its residents, is not exactly what 1 would have liked myself. When we have such immediate interests, Mr. Speaker, it is difficult to take the opposite view. With that in mind, I promised during the election campaign and subsequently to meet with the people and to tell them I would uphold their views with the decision-makers. On that point, Mr. Speaker, I will say that I am not going to wait until this coming December 4 to meet with the footwear employees who will come to Ottawa. Contrary to others, I have met with
November 25, 1985

them during the election campaign and several times afterwards. I promised them as their representative that I would uphold their views. Now, today, considering what newspaper editors have to say, what the Manufacturers' Association and the Opposition are telling us, what will are we to do about that decision? Mr. Speaker, 1 will tell you that even though it does not suit me, there is justification for that decision which was made by a Minister who has assumed his responsibilities, who, and I witnessed that personnally, has listened carefully to all those concerned with the sector, and who is saying: Now, 55 per cent of Quebec's production, for instance, consists in women's and girls' shoes. Approximately 50 per cent of Canada's production consists of women's and girls' shoes. The quota which have been in place for a number of years do not seem to work, or they have worked to the extend that the Canadian Import Tribunal, after having conducted a study ... it was not commissioned by us but by the previous Government. The results of the study commissioned by the previous Government have been submitted. In that context, the Tribunal is telling us that manufacturers should be able to compete in four categories.
Moreover, we have had regional development programs which were successful. I have in mind among others the CIRB, the Canadian Industrial Renewal Board, in which this Government has reinvested $63 million to allow it to fulfil its mandate as promised. However, Mr. Speaker, to return to more immediate concerns, those of my area, I repeat I am not totally satisfied with that decision, but, good grief, one is seldom totally satisfied with any decision, even less so in this House.
The Santana factory, in my area, which I consider as one of the best makers of footwear and winter boots, makes shoes for women and girls. Ninety per cent of its production is in that category of products. It will, therefore, get a protection for a period of three years.
The Fanec Company, with some fifty employees, also makes women's and girls' shoes and will also get the protection. The same is true for Becwith-Bemis and American Biltrite which make components.
Which means that in my own area, if I consider my immediate interest, some 90 per cent of the production is made of women's and girls' shoes.
What is more important, Mr. Speaker, the Minister has demonstrated both wisdom and vision by announcing at the same time that, to improvise as little as possible and because it is concerned about workers' interests, the Government had set up adaptation programs. That is a major aspect of its decision.
Moreover, Mr. Speaker, we should not overlook the fact that there remains a 23 per cent custom tariff on footwear generally. We can appreciate this tariff when we realize that the average for the manufacturing industry in Canada is approximately 9 per cent. I think that the average is 9 or 10 per cent both in the United States and the European Common Market.
Mr. Speaker, what disappoints me most in this debate is the lack of straightforwardness on the part of Opposition Mem-
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bers on such an important issue and constant harping about jobs. I think for instance of my hon. colleague, and I should be quite surprised if all Members of the Official Opposition agreed with this motion which was moved today and cast their votes on this motion. I need only think of the Hon. Member for Shefford (Mr. Lapierre) who, in 1981-82, was openly against a quota system for the footwear industry, just as he was against a great many other things. Now that he is in the Opposition, things have changed. They have come to realize that. It is like for the workers in the textile and clothing industry. They never mentioned them at the time; now, they have just discovered them. Well, between 1974 and 1984, 35,500 jobs were lost in Canada in the textile and clothing industry. Yet, not a word. All these jobs disappeared, and they never raised a finger. But now that they are in the Opposition, they suddenly wake up and realize the situation, when they have no responsibility ... It is easy to blame the Government without ever offering any alternative solution. They suddenly discover that there are workers in the textile, clothing and footwear industries.
I doubt whether the footwear workers will ever forget that in 1981 the Member for Shefford was not on their side when he was in a position to make decisions but refused to do so. I also think that the footwear workers should also know that the Members of the Official Opposition cannot all be in agreement. It is impossible.
This morning, I was sent a speech made by the Hon. Member for Saint-Henri-Westmount (Mr. Johnston) in Vancouver where people are generally in favour of free trade. He
said:

I made a personal submission to the Macdonald Commission at the time I was Minister of Economic and Regional Development and Science and Technology in the Trudeau Cabinet. In it I said:

And then the former Minister referred to the facts, he spoke about free trade and our trade exchanges with the United States and other countries. And God knows this is at the core of today's issue! Well let us hear what he said to those people in Vancouver, to the Vancouver Board of Trade as recently as on November 22:

One of the most basic choices facing Canadians is whether to remain an outward looking trading nation fully participating in the international economy, or to go in the direction of self-sufficiency and protectionism.

And this is what we are discussing today.

I have no difficulty with this choice nor do I think that Canadians have much doubt where their longer-run interests lie. The benefits of international trade are simply too apparent and outweight the cost of adjustments to change in world markets. What I believed then I believe now. Macdonald has corroborated that
view.
That is what the Hon. Member for Saint Henri-Westmount (Mr. Johnston) said last Friday in Vancouver speaking against protectionism to the Vancouver Board of Trade while on

November 25, 1985
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Monday in this House his Party has presented a motion that goes completely the other way. 1 will be happy to see him get up in the House and vote for this motion today. If they are sincere, for once they can put their money where their mouths are.


The Acting Speaker (Mr. Paproski):: Questions and comments. The Hon. Member for Calgary East (Mr. Kindy).


Mr. Kindy:: Mr. Speaker, I would like to congratulate the Hon. Member for Sherbrooke (Mr. Charest) on his eloquence. I think that he is quite able to defend the interests of the people in the Eastern Townships. He is quite sincere. He also knows that you cannot have commercial relations without some free trade. You cannot live under constant protection.
I would like to ask him one question: Does he believe that it was in the interests of the population in general and the people in the Eastern Townships that we acted as we did in providing certain quotas for women's and girls' footwear?


Jean J. Charest: Mr. Speaker, I would like to thank my hon. colleague for his question.
I mentioned earlier that I was not entirely satisfied with the decision because there are many textile workers in our region and I would have liked more to be done for them. I say so quite frankly.
I think that the Minister said certain things on which we should concentrate more, including the need to implement retraining programs if there are problems. Second, the Minister and the Government plan to ask importers to be careful about what they will do in the next few months, otherwise I imagine that the issue of quotas might be reassessed.
Based on the success achieved by a similar program for the automobile industry, I think it fair to say that, if we can judge the future by the past, we can hope for a number of things to come out of the notice given to these importing countries by the Government.
Generally, I find the situation difficult, and, to be frank, the people in general and the footwear workers of the Eastern townships were expecting more. However, to be fair, an editorial published today in La Tribune of Sherbrooke, the newspaper which serves my own constituency and that of my colleagues for Richmond-Wolfe and Shefford, says the following:
"In deciding to phase out import quotas in the footwear industry, the Federal Government is going in the right direction, but without enough precautions." When the author speaks about precautions, he is referring to the situation of workers and to retraining programs. I believe that today's editorial describes fairly well the concerns of the workers. However, there is one thing that I would like to make clear,
namely that, in the future as in the past, I shall look after them and monitor closely, as it is my duty to do, what is going on in the industry to ensure that the quotas will be applied fairly and equitably in the interests of the men and women employed in the footwear industry.


Alain Tardif: Mr. Speaker, I would like first of all to congratulate the Hon. Member for Sherbrooke on his fine speech. It will allow the Hon. Member both to support his Government and tell his constituents: "I have, indeed, stood up to denounce the decision." That kind of performance, Mr. Speaker, reflects very well this Government, which is quite able to say yes to those who want to hear yes, and no to the others if that is what they want to hear.
I would have just one question to ask to the Hon. Member for Sherbrooke, if I may, Mr. Speaker. The promises made by the Prime Minister were made in Sherbrooke before La Tribune.
Will the Hon. Member for Sherbrooke tell this House whether his Government has made any promises to men and women working in the shoe industry?


Jean J. Charest: As you very well know, when this statement was made by the then leader of the Opposition, your Government had not yet ordered a report, or requested a decision by the Canadian Import Tribunal. One month later, your Government ordered that report, and the tribunal rendered its decision.
Those are the circumstances surrounding that statement and in all fairness, would the hon. member not recognize that quotas were not abolished in the Sherbrooke area, that 90 per 100 of the production has been maintained? Under those circumstances, the leader of the opposition, now Prime Minister, was right when he made such a statement. He kept his word. And his statement could very well be interpreted that way.
But both the Hon. Member and I wish to be a frank as possible in the course of the present debate. I do recognize that we expected more. But he must view the global picture on that matter and the situation of all our workers as well as those in his riding, at the Brown Shoe Company, which has received many contracts from the federal government to manufacture army boots. That plant was awarded many contracts from the government since September and contracts are more profitable than quotas.
I suggest that workers in this area have been granted a fair deal under the circumstances. We were and we still are interested in granting some measure of justice to that industry as a whole, and particularly in the allocation of quotas. Both the hon. member and I know the problem and want to remind the House as well as the minister that it is not only a matter of having quotas as such but a matter of allocation. That is where the problem arises. Since those quotas have been maintained, I
November 25, 1985

think that we must see to it, the Minister and both of us, that they be fairly allocated in those sectors.


The Acting Speaker (Mr. Paproski):: The Hon. Member for Richmond-Wolfe (Mr. Tardif) on a supplementary question.


Alain Tardif: Mr. Speaker, this morning the Minister mentioned the fact that the Government was not in a legal position to overrule the recommendation of the Anti-dumping Tribunal. 1 know that the Hon. Member for Sherbrooke (Mr. Charest) is a prominent lawyer, and I have in front of me a number of legal opinions stating unanimously that the Government was indeed legally entitled to overrule the recommendations of the Anti-dumping Tribunal, and I would like to know, in the light of his statement a few moments ago to the effect that if conditions change, it will always be possible to backtrack and review the decision, how he reconciles his own assertion, his own statement, with a statement by the minister this morning in which he said that in this matter the Government was not legally empowered to overrule the recommendations of the Anti-dumping Tribunal?


Jean J. Charest: I do not think people should be misled either. There is nothing cast in concrete forever, and since there was a decision by the Tribunal, since it was given that mandate once, I presume it could be done another time. You have done it as a government. So why should we prevent it from doing so another time in another context? If the Minister does come to the conclusion that it has to be done, I suppose that at that time the legal problem you mentioned will easily be overcome.
But before concluding, I would like to tell you just one thing. By drafting your motion as you did, and I feel this is unfortunate, you, as a lawyer too, missed a golden opportunity to rally a number of members who would have supported it if you had drafted it in a way that would have allowed many of them to support it. Even the whole Government might have supported you indeed if you had introduced a motion that really was in favour of footwear workers. But you chose differently, you decided to be downright partisan-without being concerned with workers, and in just taking into account your own political assets and your own interests, as the drafting of the motion eloquently illustrates in saying that this House regrets that the Prime Minister has once again failed to maintain quotas and broken ... Once again it is the old Opposition rhetoric.
Well, let me give you a good piece of advice, my good friend, three years is a short time. You may think that it is by yelling and doing what you are doing that you will be reelected, but in spite of whatever may happen in this House, it would come as a big surprise to me if people in the eastern townships were to
Adjournment Motion
vote for people who have nothing else to do but whine around because times have changed, and I think they will continue for a long time to cast a conservative vote. And I for one shall vote against that motion.


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



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Paproski):: It is my duty, pursuant to Standing Order 46, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: The Hon. Member for Broadview-Greenwood (Ms. McDonald)-Health (a) Request for ban on cigarette advertising, (b) Anti-smoking advertising contract; the Hon. Member for Davenport (Mr. Caccia)-Environmental Affairs (a) St. Clair River-Control of industrial pollution, (b) Provincial environmental security fund.


Jean-Robert Gauthier: Mr. Speaker, I rise on a point of order. You have just announced the adjournment debate. In my experience when there is an opposition day and a vote follows, we have, 1 thought, always suspended the adjournment debate. You have though just told us there would be an adjournment debate tonight.
Would you look at the rules and can you reconcile for us Standing Order 19(4) and Standing Order 46(7). We need to understand clearly that on an opposition day with a vote that we should not expect the adjournment debate.


The Acting Speaker (Mr. Paproski):: The Hon. Member has been here for quite a few years. He realizes that Standing Order 19(4) and Standing Order 46(7) are new rules that have been implemented for the last period of time.
I am sure this point is being considered under the new rules to come into effect after we recess. I think the Hon. Member should bring it to the attention of people in the House who are responsible for the changes to the rules. 1 agree with the Hon. Member. I hope he gets the ear of other people in the Chamber.

November 25, 1985
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GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Tardif (Richmond-Wolfe):
That this House regrets that the Prime Minister has once again broken an election campaign promise, this time by failing to maintain quotas on imports on shoes and by compounding this betrayal by failing to make adequate provision for the thousands of workers whose jobs are adversely affected.
Lloyd Axworthy: Mr. Speaker, first let me express my deep condolences and sympathy to the Hon. Member for Sherbrooke (Mr. Charest) on his funeral speech. It is always a sad occasion when a Member who thought he had such a bright and promising political career has had it prematurely brought to an end by the actions of his own Government. Those of us in the House who have seen this happen on occasions from time to time can only express our deep understanding of the predicament of the Hon. Member and others who have built their careers on the untimely and unwise foundation of relying upon the Prime Minister (Mr. Mulroney) to say what he intends and to follow through on that. Surely by now many Canadians are worrying that that is a very slim and unreliable reed upon which to build any sense of expectation of the future. We can only say we admire the way in which the Hon. Member for Sherbrooke has gone down with his sinking ship with brave words flying and his facts totally out of whack.
This is an important debate, Mr. Speaker. It is an opportunity for us to come to grips with some of the most important issues facing Canada. In one unfortunate way the shoe industry is serving as the example which should give warning to all other industrial sectors on what to expect from the Government when it comes to the crucial issue of how they will be treated when it comes to matters dealing with an effective trade policy.
The fundamental defence that we have heard in the House from the Minister and others reminds one of what certain people used to say. When the then Leader of the Opposition made his famous statement, his declaration of Sherbrooke, that under no circumstances, under no possible conceivable future circumstances would he ever change his mind, he said: "We did not know that the Liberals at the time were going to start a study."
Anyone who had known anything about the industry at that time would have known there were a series of inquiries concerning the competitiveness of the footwear and textiles industries which proceeded on an almost periodic basis to assess the current state of those industries. No one says that one has to listen to the recommendations of a study. I know the Minister has made some sort of legal argument about it, but it is absolutely fallacious. There is no requirement to agree with recommendations. The Government simply takes studies as good advice if it so desires.
What I find interesting is that the Government did not take the advice of the import tribunal. It took part of the advice. It took the advice which said to get rid of the quotas. The Government totally ignored all of the advice and all of the recommendations which said what measures the Government should take to assist the shoe industry to modernize and to assist workers to gain some protection.
I think the Minister is an honourable man as are all Members in this House. He should cease and desist trying to use that explanation. If he is going to stand in this House, as he did in Question Period and during this debate and say that the import tribunal made him do it, that he was compelled by the logic of its argument, then I want to know why the Minister left out so much of the tribunal's conclusions and recommendations. Why has the Minister and his Government so totally ignored the proposals made for development of a proprer industrial program, and to provide alternatives for the workers? Why did the Government leave out the kind of major labour market-place programs that are required to deal with workers' needs? Why did the Government, in effect, eliminate a substantial part of the findings of the report and simply go to chopping quotas?
I think we know the answers. The one side of those recommendations fits with the Government's peculiar ideology and with the necessity of satisfying pressures from the Americans and the Europeans. We have come to understand that about the Government. We know what stimulates its sense of action and direction. When the President of the United States says jump, the immediate response is to ask "How high?".
When it comes to the question of dealing with the responsibility of a federal Government to respond to industrial or economic problems and to use the resources, the planning and the facilities of the federal Government to assist and facilitate adjustment, the Government relies on the "market-place theology". The Government starts to say: "My goodness, we cannot have the Government intervene", unless it happens to be Domtar, Petromont or Hyundai. All of a sudden the Government finds some convenient excuse to forget those principles in the market-place and immediately comes up with the cash, the bail-outs and the big grants. I say that because some of the Members at least used to have a great time when in opposition with self-righteous indignation at our Government's attempt to help industry. There is only one difference, Mr. Speaker, ours worked. Theirs do not seem to. We had the example of Chrysler. The Government has the example of the Canadian Commercial Bank. One succeeded in preserving jobs. The other has succeeded in almost bringing the banking industry to its knees. Of course, we can make comparisons in other areas.
The fact is the Government is dissembling very seriously on this issue and that is the reason for today's debate. That is why it is important for us to consider what is the responsibility of a Government when it says it is removing a form of protection from industry. What responsibility does the Government have to assist that industrial sector and the workers in it to meet competition?
November 25, 1985

Last week when the statement was made, we heard a number of protestations, some even from Members of the New Democratic Party who have that wonderful capacity to have nothing but the best answers because they have never had to implement them.


Nelson Andrew Riis: Just wait.


Lloyd Axworthy: I want to talk for a moment about the Canadian Industrial Renewal Board. In some ways that is at the crux of this debate. It was brought into effect after the application of the quotas in 1980 as a joint initiative by the private sector and the Government of Canada to provide for a series of supports to industry to facilitate its modernization. It was an interesting model, one which has been examined and followed by many other countries.
For those former professors who have lectured on questions of industrial readjustment, they might want to go back and read some of the reviews of those examinations that have appeared in a number of fairly learned journals in Great Britain, Europe and in the United States. That particular Canadian Industrial Renewal Board was a co-operative partnership between members of the industry, some very senior business people, along with key federal departments who were to start planning the development and the reorganization of industries facing competition of low labour industries from offshore.
We recognized at the time that it was a problem, and at the time our position was that there should be a two-pronged approach: to continue protection and at the same time, and running parallel, to put into place the type of co-operative assistance that would allow the industries to reach a certain stage of maturity and self-sufficiency and strength such that they could meet the competition.
We recognized that in some according to old industrial standards they could not meet the competition, but that, through a combination of new design and marketing initiatives, Canadian industry, whether it be the textile industry or footwear, could find niches in the global market; that it could find certain areas in which, through the input of information and the input of intelligence and the input of highly skilled manpower, it would be able to fashion services and commodities and products that would have sales appeal. But, Mr. Speaker, that takes time. It is not something that happens overnight.
The Hon. Member for Windsor-Walkerville (Mr. Langdon) says: "Well, it can be done in two years and we can wrap it up and all go home". The fact is, it is something that takes a period of time to achieve. The Canadian Industrial Renewal Board was established to allow the time for those industries, in conjunction with that private sector/government agency, to intervene, to invest, and to develop.
This Government has now had 14 months in office. It knew it was going to have to make a decision on the quotas at some point in time. It has had 14 months to take the Canadian
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Industrial Renewal Board and improve upon it, to augment it and change it, as recommended in this report, a report in which the Canadian Import Tribunal states that the Canadian Industrial Renewal Board should have its funds increased and its powers augmented. The Government has now had 14 months to either act on that recommendation or to come up with its own industrial plan for the shoe industry.
Why is this Government now talking about planning? Why is it now saying that it will give grants of $100,000 for industrial adjustment services? Having been responsible for that program, I can tell you that this grant system is nothing more than a placebo. It is a way of simply bringing workers together to find a temporary solution to their unemployment.
The Government has had 14 months to prepare for its decision with regard to the alternative to take in respect of this industry, a decision which should have, as its central objective, the capacity and the ability of this industry to survive in terms of the international competititon it faces. Absolutely nothing has been done. There has been no planning; there has been no preparation. Indeed, this Government went one step beyond in getting rid of the Canadian Industrial Renewal Board. This Government got elected because they were so much smarter than we were. That being so, why didn't they-


An Hon. Member:: You said it!


Lloyd Axworthy: -why didn't they replace the Canadian Industrial Renewal Board with something that was better?


An Hon. Member:: You said it!


Lloyd Axworthy: I am simply repeating what you have said. What I want to know is, where is the proof of it? Where is the proof of your ingenuity and your innovation? Where is the new industrial strategy for shoes and for textiles? Where in the process is the Minister of DRIE in terms of the development of an effective industrial strategy for these so-called sunset industries?
He doesn't have one. The Government doesn't have one. It now comes to a point where it imposes this kind of a Draconian decision on that industry and then leaves that whole sector hanging out to dry, just as it has left the Hon. Member for Sherbrooke hanging out to dry. Neither the industry nor the Member for Sherbrooke will survive. The workers will remember. They know when they have been had. They know when they have been had by this Prime Minister.
There would have been a higher level of tolerance and understanding had this Government at least tried to help. When the shoe manufacturers came to the Minister several months ago with a proposal for a new investment of $70 million in new plant and production methods-and investment that would have led to the creation of new jobs and the creation of new products-did the Government of the day take up that offer and agree to sit down to discuss it? Did it say: "We know that we have a lot of pressure from the Americans and from the Europeans and that we have to come to an answer. We realize that there has to be some modernization of

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plant, so let's sit down and work something out. If you are prepared to put your money up, maybe we can match it".
Was there that type of consultation with the industry? Was there any attempt to work out a plan of survival, a plan of new development? Again, nothing happened. So, why should it come as a surprise that there is indignation? Why should it come as a surprise when we have been treated to 14 months of inaction, 14 months of a lack of preparation and planning? Of course, this is something that is happening in the entire area of trade. Where are the advisory committees that we were promised seven or eight months ago, whether they be related to textiles, or lumber, or steel? Where are the meetings we were promised in these sectors?
I have met with representatives from these sectors and on asking how the meetings were going, I have been told that they have not yet been invited to any meetings. They do not know what is going on. Because they have not been consulted, they cannot say what the negotiations are going to be like.
Consultation was promised. Advisory committees were promised. Instead, what we got was a temporary, part-time, partially loyal negotiator, an individual who says he will do the job "after four" once he has taken care of his other interests.
In the meantime, as we heard from the statements earlier today, the Americans are already proposing a whole series of very serious negotiations in respect of lumber and publishing. The Americans want to get down to the hard facts. Contrary to what the Secretary of State for External Affairs (Mr. Clark) said earlier, they are putting forth the resolution of the disputes in these areas as a precondition to there being any general discussions on trade. I have rechecked the statements from the Washington news reports, and certainly the American trade representative is saying that these issues have to be resolved before the general talks begin.


Charles Joseph Clark: That is not-


Lloyd Axworthy: I will send you the quotes. 1 hope the Secretary of State for External Affairs will take a lesson in speed reading so that he will be able to keep abreast of all of the dispatches coming in. I am sure he must be behind.
The fact of the matter is that the Government is not coming to grips with the needs of our domestic industries. Our industries are apprehensive. They do not know what investment plans to make. I have spoken to several major industrial groups, all of whom say that they are being left in limbo.
The brewery industry employs tens of thousands of people across this country, and it is an industry that has invested some $3 billion to $4 billion in plants in the last several years. That industry has now stopped absolutely all of its investment plans. It recognizes that in the event that there is a free trade agreement entered into, it will be virtually wiped out right across the country. As a result, it has put a halt to its investment plans. Because it simply does not know what will happen, hundreds of millions of dollars are being held back from investment.
That is the kind of problem we are facing. This Government has designed a communications strategy to make sure that Canadians do not know what is going on. Its aim is to keep people in the dark. The strategy is: "Don't let on what we are up to".
I want to come back to how the example of the shoe industry argues against that approach. We have kept the shoe workers and the shoe manufacturers in the dark for 14 months. They made their offer; they made their proposal. They said: "We want to get to the table to see whether or not something can be worked out". However, they were given no assistance in doing that. Now we are faced with the spectre of having the same kind of indifference being applied to countless other industrial sectors across Canada as we get into the serious negotiation on free trade.
The Minister has used the report of the Canadian Import Tribunal as his defence. Did he read the supplementary report that was prepared as part of that report by the Employment and Immigration Commission, a report which points out that the prospect for the re-employment of many of the workers in that industry is virtually nil given an unemployment rate of 10 per cent or better?
At present we have an unemployment rate of 10.3, 10.6 per cent. It was the view of that commission that the only prospect for the re-employment of the thousands of workers in that industry would be in the situation where the unemployment rate was somewhere around the level of 7 per cent or 8 per cent. Well, I would say to the Hon. Member for Sherbrooke, who quickly scooted out of the House-he is so deeply interested in this debate that he didn't hang around-that the fact of the matter is that the responsibility for reinvestment in that sector, in that region, rests with the Government.
Even if it had been the position of the Government that it no longer wished to protect the shoe industry, it should have at least sat down with the people involved to help them plan for alternative employment. The unemployment rates in many of those regions are not in the range of 10 per cent, the national average, but more in the range of 15 per cent or 20 per cent. We will place a number of workers into a larger pool of unemployed in which their chances of survival are negligible.
What does the Government have to offer? What is its response to this? What was the benificent contribution it made to that sector? It said it would give the workers industrial adjustment services. It said that civil servants from Employment and Immigration would open offices in the regions and talk to the people about how they can get early retirement or how they can leave the regions and perhaps find employment elsewhere. That was the answer of the Government. That is simply not good enough. It is not good enough for the shoe workers and it is not good enough for the hundreds of thousands of workers who will be affected by proposed trade negotiations. Surely we must be able to learn at least one lesson from this. Surely we must learn that it is time the Government got busy and did its job.
November 25, 1985


Steven W. Langdon: Mr. Speaker, I have three sets of comments to make and questions to ask the Hon. Member. The Hon. Member was absolutely correct in identifying the Canadian Industrial Renewal Board and its work with the industry as being the crux of the issue. However, I think there is a question which must be posed first and that is why did it take from 1977 when shoe quotas were first imposed until 1982 for the CIRB to effectively begin to play a significant role in helping the industry to modernize? Why did it take so long for the previous Government to act? In fact, why did it take so long for previous Governments to act? The Right Hon. Secretary of State for External Affairs (Mr. Clark) led a Government during that period of time as well. Why did it take so long for it to be recognized that the future for workers in those industries required active, direct intervention by Government in close co-operation with the private sector?
Second, why was it that the quota system which was put into effect in 1981-82 was itself so faulty? The Canadian Import Tribunal Report is absolutely damning in its clear indication that the vast majority of benefits from that quota system did not go to the manufacturing companies that were expected to gain the benefit in order to invest and produce more and to recover and become a key part of Canada's industrial structure. Why is it that when the Canada Import Tribunal did an analysis, it found that something like 20 per cent at maximum of the benefit of those quotas actually went to the manufacturing companies with the great bulk of the rest of the benefit going to the retailers and the importers? Surely that was not what we wanted.
Finally, why was it that the lessons of worker adjustment experiences of which the Member has spoken so eloquently today as they affected the footwear industry were not creatively applied across the country? For instance, why was ILAP, the program of industrial labour adjustment benefits for older workers of my community, eliminated as of March 1984? Why was there no establishment of a comprehensive system of industrial adjustment assistance for older workers which would cover everyone affected by job loss in major industries throughout the country? Why did that not become a centrepiece of the attempt to make our industrial economy a more efficient, effective and humane part of Canadian society?


Lloyd Axworthy: Mr. Speaker, I appreciate the Hon. Member's questions. I believe they are proper and I welcome the chance to respond to them because I think it is useful to look at the answers to those questions.
Let me deal first with the question regarding the application of an industrial adjustment program in 1982 as opposed to immediately in 1977. In 1977, when the quotas were brought in for reasons about which we all know, the assumption was that the industry itself would undertake its own modernization. That was the premise upon which the initial quotas were established. As it was discovered in the practice of that particular exercise, many of the industries did not have the capital base upon which they could get the kind of assistance they needed. They did not have the equity leverage and in many cases did not have the planning capacity. Many of these
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were small firms which existed in a fairly limited industrial system. They did not have the capacity to anticipate or deal with modernization.
When the quotas were re-examined in 1980, it became clear that Government would have to play a stronger role. We spent several months, as I know because I was involved in the negotiations, with both industrial and labour representatives to come up with what was considered to be the most effective kind of a system. It was out of that that the Canadian Industrial Renewal Board was born. It was brought into effect by 1981, members were appointed to the board and Mr. Desmarais was made the chairman.
The idea at the time, as the Hon. Member probably knows, was that we were trying two different models at the same time, the Industrial Renewal Board and ILAP. One was a community-based initiative that was Government directed and the other, through CIRB, was more private-sector directed. We learned from the experiences of 1977 and on that we could not rely upon the self-renewal of the industry but that we had to give it a helping hand from a new kind of agency. That was the reason for the change-over. I think we can still learn from the model of CIRB. Had we been re-elected, there were things about it that we would have improved upon substantially as well.
Regarding the question of the impact of the quotas themselves, I agree fully with the Hon. Member's assessment. They were not nearly as effective as they could have been. My own judgment at the time was and still is that part of our problem is the fragmentation in the administration of trade policy. Regulatory agencies are responsible to one Minister, National Revenue implements the customs duties and the Department of Finance has its own form of macabre intervention in these matters. Now the Minister for International Trade (Mr. Kelle-her) reports to yet another Minister. I think there is a problem in implementation with having a Department like National Revenue which has a somewhat different orientation than a Department which would try to use import-export policy as part of a larger industrial package. The Department of National Revenue sees it as more of a revenue-gaining exercise and does not apply it very effectively.
A very important study which the Hon. Member may have read was done by the Institute for Research and Public Policy. That study examined that problem and pointed in particular to the solution to the problem of import quotas being a more coherent administration of the entire program.
The third question was why we did not build upon the ILAP experience. Under the reorganization of the Department of Industrial Economic Expansion, the Government brought in the IRDP program and the IRDA Program, programs which had very different funding bases and provided the industrial grant-loan system that could be used for ILAP. Because they were much more varied and richer than ILAP, they were seen as a replacement for it. The labour-adjustment side was maintained but the instructions to the Departments involved were that where there was a case of major adjustment required, they would combine the programs under the IRDP program

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with the labour-adjustment programs administered by the Employment and Immigration and Labour Departments. In effect, there was a continuing level. However, as we well know, at this point in time it is impossible to implement that because under the changes brought about in last November's statement many of the positive parts of the IRDP which would allow a community to reinvest into industry or to carry out the type of work which was envisioned under the original IRDP were eliminated.
I thank the Hon. Member. I know that my time has expired. Not only did the Government get rid of the CIRB program but it totally emasculated the IRDP, which could have been used as part of an industrial adjustment system in communities where it was needed. In a sense, the Government took two programs and put them out of commission. This left the federal Government totally without any type of arsenal of weapons to bring to bear on the type of changes about which we are talking.


Jean J. Charest: Mr. Speaker, the Hon. Member for Winnipeg-Fort Garry (Mr. Axworthy) mentioned that I was out of the House. I had to leave on an urgent matter. However, I caught a glimpse of the Hon. Member on television while he was mentioning that if we wanted to recycle these workers the level of unemployment would have to be around 7 per cent or 8 per cent. I find that to be a pertinent point. In the riding of Sherbrooke it was always around 12 per cent and 15 per cent before the election and for a couple of years prior. However, since September of 1984 I wish to give the Hon. Member the good news. It is 8 per cent now.


Some Hon. Members:: Hear, hear!


Jean J. Charest: The bad news is that it had nothing to do with the Hon. Member for Winnipeg-Fort Garry (Mr. Axworthy).


The Acting Speaker (Mr. Paproski):: Order, please. If the Hon. Member for Winnipeg-Fort Garry would like to respond I will give him the 30 seconds which remain.


Lloyd Axworthy: Mr. Speaker, I would be more than delighted to respond. I think the Hon. Member for Sherbrooke needs one small lesson in economics. It is called time lag.


Some Hon. Members:: Oh, oh!


Lloyd Axworthy: The Conservatives laugh. That is because they simply show their ignorance. The fact of the matter is that in any form of an economic cycle the type of momentum and force bringing about changes starts many months before. I agree that at this point in time the Hon. Member for Sherbrooke and his constituency may be finally gaining the results of the type of good investments made by the previous Liberal Government.


The Acting Speaker (Mr. Paproski):: I regret that the time allotted for questions and coments has now terminated.


Carlo Rossi: Mr. Speaker, I rise on a point of order.


The Acting Speaker (Mr. Paproski):: The Hon. Member for Bourassa (Mr. Rossi) on a point of order.


Carlo Rossi: Mr. Speaker, the Hon. Member for Sherbrooke (Mr. Charest) said he was anxious to see if members would be here to vote tonight. I am glad he said that he had to leave on an urgent matter. He was alluding to the possibility that some members might not be here to vote according to waht they said. That's what he meant. But, Mr. Speaker, this is rather important, because if there are members who are not here to vote, it is because they have to, like him, to be elsewhere.


The Acting Speaker (Mr. Paproski):: I appreciate the Hon. Member's comments. On debate, the Hon. Member for Broad-view-Greenwood (Ms. McDonald).


Ms. Lynn McDonald (Broadview-Greenwood):: Today, Mr. Speaker, we are considering the question of shoe imports and the decision of the Conservative Government to do away with quotas in that industry, which is tantamount to dropping that important industry itself.
First of all, it is a question of the credibility of the Government and the Prime Minister (Mr. Mulroney). When he was in Sherbrooke he promised he would maintain quotas in the footwear, textile and clothing industries. In so many words, the Prime Minister said he was not in favour of free trade in those sectors. Now he claims he did not make a firm commitment respecting footwear, but that is not true. He did make promises concerning shoes, textiles and clothing.
Earlier today his Minister said in the debate that the promise had been made before the elections were called. So he went on to suggest that those were not election promises. Mr. Speaker, I would counter that, as far as everybody is concerned, it is altogether unreasonable that a promise made before the election would indeed be broken by the Prime Minister himself. It is a promise and the voters, men and women alike, expect the Government to live up to it.
The problem in this industry is more acute in Montreal and in my Toronto riding of Broadview-Greenwood but it exists throughout Canada.
When a plant loses its customers and shuts down, there is no easy solution. It is a tragedy for all workers because most of them simply cannot find other jobs. For management it is not easy to transform a factory, particularly a shoe factory, into some other kind of manufacture.
When the Government announced its policy designed to end quotas it assured us that consumers would stand to benefit. Well, that is not clear because, under abstract conditions, one
November 25, 1985

is hard pressed to figure out how prices will fluctuate in any sector.
In any event we can always question the morality of dumping. When a country sells its products below cost, that is called dumping. When it pays its workers very low wages like about $1 per day, when it bans all unions and does not insist on healthy working conditions, this is immoral. And Canadian workers cannot compete with such conditions.
We have to maintain and improve our quota system. We in the NDP, are convinced that the quotas can help the industry giving it time to modernize so as to be able to compete on the international market. To achieve that modernization the industry needs time. The restructuration and modernization process has already started. Unfortunately, things have progressed slowly. The Government's support for this industry before 1981 was very limited, about S2.7 millions. As of 1981, the Canadian Import Tribunal allocated more money, that is $14.1 millions. But, of this amount, only $2.2 millions have been paid. This shows that the companies are at the beginning of the modernization process and that to restructure the industry will require more time.
The quota system is not problem free. The Canadian Import Tribunal notices that only 6 per cent of the benefits go to the manufacturers. The quotas were mainly to the benefit of importers and big retailers to the detriment of small retailers.
There is no quotas for plastic shoes which have been imported in extremely large quantities.
In general, imports have increased by 23 per cent between 1980 and 1984, because of the loopholes. We have to plug these loopholes and improve the quota system to make sure that the benefits go to the manufacturers and the retailers which sell Canadian shoes.
If we simply lift the quotas, the industry will be destroyed and the workers will lose their jobs. Moreover, we will waste the initial investment. We should not abandon this industry but promote the modernization process, and especially we must make sure that the workers male and female, and their families keep their jobs.

This morning the Minister suggested that the program of quotas had actually worked and that that was why it was being discontinued. He suggested that in the area of men's footwear, where the program is being discontinued, the quotas had had an effect and modernization had taken place. He said that they were able to compete and that the problem existed only in the area of women's and children's footwear. However, a closer look at the figures suggests otherwise. Of the nine companies receiving grants under the support program, seven were grants to companies producing women's and children's footwear and a couple of them were for women's footwear only. If the Minister's contentions were correct, then this list would have been of companies producing men's footwear. It would have been these worthy companies which got the grants,
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the grants which helped them to do the modernization necessary and were no longer needed. The logic is certainly very attractive. It just happens that the facts do not match up to the logic.
The report of the Canadian Import Tribunal itself, which is supposed to have been the basis for the Government's policy, in fact supports the argument that the New Democratic Party makes. The Tribunal has noted that there was no indication that a major restructuring had taken place. It shows how imports in the United States have zoomed up with the dropping of quotas. The job loss in Canada would have been very much worse than it has been-and it has been bad all over Canada-where there is an industry of this sort. It certainly has happened in my riding and I know our colleagues in Quebec are very concerned about job loss there.
There is a lesson, I believe, in the failure of the program to do the job. It is a lesson on how to approach job creation. The Liberal approach was obviously not adequate. It had a program of throwing money at the companies but obviously the money was not properly spent. Most of it was not spent at all. Modernization did not start. Simply introducing a program and hoping for the best is not enough. It has to be a rational program. It has to be worked at. There has to be adequate time. Other countries which have done this kind of economic planning have put their money where it could be used, into modernization, and have had far better results than this program. A very modest program it was, but even so, it has simply not been used the way it could be.
The Conservative solution of simply giving up, of being prepared not to have any domestic industry at all, 1 feel is unacceptable. It is a solution the Conservatives like because it suits an abstract political philosophy. It is deregulation. It is free trade. It suits the Conservatives political ideology but it is not good for the people of Canada and it is certainly going to be very disheartening for people who have lost jobs and those who risk losing the jobs they have. We say that political philosophy is not important. It must serve the people and must not be a principle upon which everything else can be ignored. The lives of families, of communities, of people, should not be ignored for the sake of this abstract principle. It is hard to judge other people's motives, but it is very much a matter of concern in this period in which free trade is being discussed. The country's willingness to take all of these risks for the sake of a political principle, its willingness to go along with the United States on free trade, is something which is of very great concern to us.
We say there is a far better solution. It is not to give up and abandon people, their families and communities. It is to make the program work. It is to encourage modernization, to plan carefully and to keep the protection going as long as it is needed while this modernization does take place. We are confident our people can cope and compete. There is no reason why Canadians cannot make footwear which competes in the world markets. There is no reason why we cannot have a

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decent textile industry. We believe it should and can be done. We call upon the Government to bring in a decent program which will put people and jobs first, a program which will work for all Canadians.


The Acting Speaker (Mr. Paproski):: There are no questions or comments.
Pursuant to Standing Order 13(3) it would be my duty to interrupt the House proceedings at six o'clock in order to dispose of the deferred division of Friday last on Bill C-66. However, in view of the short extension of this day's sitting due to ministerial statements, I would propose to the House to continue debate on the opposition motion until 6.04 p.m., at which time the House would proceed to the division on the said motion, followed by the deferred division on Bill C-66. Is it agreed?


Jean-Robert Gauthier: Mr. Speaker, I take it we are not creating a precedent here because the symbolic four minutes which were added to today's orders could be 40 minutes or, for that matter, an hour. I just want to make sure we protect our position that statements in the House which are added to our time will not in the future be added in this same manner.


Ramon John Hnatyshyn: Mr. Speaker, I just happened to catch the proceedings on television so I rushed in to the Chamber to say with respect to the proposal for today, it seems to be sensible. We have a procedural situation and it strikes me that your approach, Mr. Speaker, has the great advantage of logic and reason to it so I think we would accept that suggestion.
With respect to the comment made by the Hon. Member for Ottawa-Vanier (Mr. Gauthier) with respect to the proceedings at the end of the day, or the Adjournment Debate, so called, I will be glad to discuss the matter with the Hon. Member for Ottawa-Vanier.
If you will recall, Mr. Speaker, the point of the provision in the rules was that we wanted to ensure that there was no diminution of private Members' rights with respect to the Adjournment Debate, particularly in those circumstances where there are ministerial statements. We bent over backwards procedurally to ensure that whenever there are statements, they would not in any way negatively impact upon the right of the private Member to ask for an elaboration on Question Period answers about which they were not satisfied. That was the genesis of the present rule. That is why we have the late night show situation in this particular set of circumstances. But we will, of course, continue to consult and I will be glad to receive the recommendations of the Hon. Member. We agree to your proposal, Mr. Speaker, with respect to the votes today and I will continue my discussions with the distinguished Hon. Member for Ottawa-Vanier with respect to late night shows.


The Acting Speaker (Mr. Paproski):: The unanimous consent is only for today's business, then. Is it agreed?


Some Hon. Members:: Agreed.


Mr. Gerry Weiner (Parliamentary Secretary to Minister of Employment and Immigration):: Mr. Speaker, 1 am glad to be able to join in the debate today which so greatly affects all Canadians. Jobs are really what we are all after and it is ironic hearing my hon. friend, the Hon. Member for Broadview-Greenwood (Ms. McDonald), speak of how the quotas have not adversely affected Canadians. I would like to recount that in an eight-year period there was an additional cost of some $500 million which the average consumer had to spend. So there is a dramatic effect.
I think we should also want to reflect that if our trading partners exercise their legally recognized rights of retaliation under the GATT, there will be job loss in a lot of sectors. The impact of import quotas on footwear cannot be considered in complete isolation of the impact they have on other sectors of the economy. The fact is, as the Minister for International Trade (Mr. Kelleher) said in the House, continuation of import quotas on all types of footwear would have seriously affected Canadian interest and Canadian jobs in other sectors unrelated to the footwear industry. If there are any doubts about this, ask the petrochemical producers in Ontario and Alberta, craft paper companies in British Columbia, steel producers in southern Ontario or companies producing sewing machine needles and car radios in both Quebec and Ontario, If there are any further doubts, ask the many highly successful companies producing fur garments in Montreal and elsewhere in Canada, along with the thousands of people across this country whose main source of income is tied directly to the fur industry. All of these companies have at least two things in common. First, they have been very successful in exporting their products outside of Canada, including to the European Economic Community. Second, earlier this year the European Economic Community threatened to withdraw concessions or, in more blunt terms, to retaliate against up to $150 million worth of exports of their products. The EEC threatened to raise tariffs to prohibitive levels on Canadian petrochemical products, steel products, craft paper, fur garments, sewing machine needles and car radios.
We managed to stave off this threat of retaliation only by agreeing to forego duties on a wide range of products imported from Europe. This agreement, which was concluded only a few days before the EEC was about to implement its threat of retaliation, cost the Treasury some $12 million. However, this was not the first compensation agreement concluded with the EEC. Two other agreements were concluded in response to earlier measures taken on footwear imports to Canada. In total, over $13 million in duty were foregone on products from the EEC and over $25 million globally have been paid in compensation in response to import quotas on footwear. In other words, the opposition Parties are attempting to ignore the fact that in order to benefit from exports to other countries, Canada must permit imports from those countries. The Opposition is also attempting to ignore the fact that quotas in one sector can cost jobs in other sectors. This attempt to ignore the facts will be recognized for what it is by the Canadian people.
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For the past eight years Canada has justified the imposition of footwear import quotas internationally under the safeguard provisions of the General Agreement on Tariffs and Trade. These provisions enable Canada to take quota action or other safeguard measures in situations where imports are causing or threatening serious injury to domestic producers. Under the GATT provisions these measures are intended to be temporary in nature for the extent and time necessary to prevent or remedy injury. Since footwear quotas were first imposed eight years ago our trading partners have alleged that eight years of footwear quotas are not temporary in nature and that such lengthy imposition of quotas is contrary to Canada's obligations under GATT. As well, in the absence of a finding by the Canadian Import tribunal of injury or threat of injury caused by imports in four of five sectors of the footwear industry, we would be hard put to convince our trading partners that any extension of quotas in these categories would be justified under the provisions of GATT.
The Opposition appears to ignore the fact that exporting countries also have rights under GATT. It enables our trading partners with substantial interests as exporters, affected by safeguard action, to either claim compensation for impairment of access or, in the event a satisfactory agreement and compensation cannot be concluded, to take retaliatory action. In requesting compensation from Canada, therefore, the European Economic Community has been operating within its rights under GATT. The EEC has not been alone, however, in condemning the length of time that import quotas have been placed on footwear and the negative impact of quotas on their exports to Canada. Import quotas on footwear have been a serious irritant with many of our friends in the less industrialized world who have found it difficult to expand their sales to Canada. The issue of footwear import quotas has come up frequently in our discussions with other countries. Countries such as South Korea, Brazil, India and many others have identified footwear import quotas as an irritant in our bilateral trade relations with these countries. Although the Liberals and NDP profess to be concerned about the plight of Third World countries, I note that today they are attempting to ignore the impact quotas have on the development prospects in lesser developed countries. I will stress, however, that Canada will vigorously defend internationally its right to extend import quotas on those classes of footwear on which the tribunal found injury or threat of injury in the absence of special measures of protection. We will point out to them that the tribunal has just completed its most comprehensive inquiry to date into the footwear industry. We will also note that the tribunal received extensive submissions and held public hearings so that all parties could make their points of view known. As a result of this comprehensive review, first initiated in Junme of 1984, the tribunal concluded that women's and girls' footwear production remains vulnerable to injury from imports. We will note that the tribunal recommended that import quotas be maintained only with respect to this one sector of the industry.
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In talking with our trading partners we have the tribunal's very detailed rationale for extending footwear quotas on Women's and girls' footwear. The tribunal believes that producers of women's footwear remain vulnerable and that many of these producers could not compete successfully in the absence of special measures of protection. In the case of women's footwear the substitutability factor is of great significance. While women's leather fashion and comfort footwear produced in Canada are, in the view of the tribunal, able to compete with imports of leather product, principally coming from Europe, the fact that non-leather product is, in the view of the final purchaser, largely substitutable for leather creates a degree of competition from non-leather imports which the domestic producer of leather product may not be altogether able to meet. There is, moreover, significant production of women's non-leather as well as leather in Canada. Because of this substitutability, the impact of the removal of quotas on the women's footwear sector as a whole would be unfavourable. However, it is not clear that it would be universally adverse. The analysis regarding optimum size and regarding profitability by size and location bear upon this point. Some parts of the sector would be vulnerable. Some may experience difficulties. The rest are capable of competing successfully.
1 say once again that we will vigorously defend our right to extend quotas on women's and girls' footwear, pointing to the tribunal's inquiry. Nevertheless, as I indicated earlier, our trading partners have rights under GATT. We anticipate difficult negotiations ahead once again with the European Economic Community. However, we are confident that, backed with the findings of the tribunal, the steps Canada has taken to lift the quotas on four out of five sectors on Novemebr 30, 1985, along with the phase-out provisions for the quotas on women's and girls' footwear, that a satisfactory solution can be reached with the EEC.
Quotas are only one of several factors which affect the competitiveness of the domestic footwear industry. Other factors include the level of import tariffs, forign exchange rates, and the impact of disruptive imports caused by dumping or subsidization practices. Let's look at the tariff protection the entire footwear industry will continue to receive. The bulk of footwear enters into Canada at a rate of duty of slightly over 23 per cent. There are no general preferential tariffs applied on the bulk of footwear imports into Canada. The average tariff applied by Canada on imports of manufactured goods is 9 per cent. Internationally, the EEC applies an average tariff of 8 per cent on footwear imports, whereas in the United States it is 10 per cent. Therefore, the Candian industry receives a lot of protection under the Canadian tariff, both in relative and absolute terms. The tribunal also notes that the competitiveness of Canadian footwear with imports is affected both by the lvel of exchange rate and the level of inflation in Canada compared with that in the major footwear exporting countries. Since 1980 the tribunal notes that Canadian footwear has declined in competitiveness with imports from some countries, while at the same time increasing its competitiveness against imports from other countries. In particular it notes

November 25, 1985
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that the Canadian product appears to have increased its competitiveness agaisnt imports from Hong Kong and Brazil based on exchange rate changes and rates of inflation. The industry will continue to have recourse to the Special Import Measures Act with respect to subsidized or dumped imports of goods into Canada. In fact, the tribunal notes in its report:
During the course of this inquiry the tribunal became aware of a variety of government assistance programs made available to producers in a number of exporting countries.
They go on to say they are fully confident that the provisions of the Special Import Measures Act are fully adequate to address any future problems which may arise where dumping or subsidization appears to exist. This is an important point. To the extent that the Canadian industry is concerned about disruptive imports of footwear into Canada, it is important that it seeks recourse through the legally established measures provided under the Special Import Measures Act. The Canadian industry will therefore continue to benefit from a lot of protection against imports. Quotas will apply for the next three years on women's and girls' footwear. Tariff rates of around 23 per cent will prevail on the bulk of footwear coming into Canada, and the industry will continue to have recourse to the provisions of the Special Import Measures Act. The Government recognizes, however, that the lifting of quotas will give rise to a moderate surge of imports but the market should stabilize within 12 to 18 months. Some of the surge will be due to pent up demand for lower priced shoes. Some of it will be due to the fact that there will be a number of new importers. Some of it will be caused by what we expect will be an inclination by retailers to experiment by importing new items. To mitigate any effects the sruge may have, we will be conducting consultations with the countries which are Canada's principal footwear suppliers. As the Minister for International Trade said in the House, we will put them on notice that their long-term interest in the Canadian market would best be served by a prudent and gradual approach to sales. Canadian importers who have been known to bring in footwear for the sole purpose of establishing a high base for the allocation of import quotas will be made aware that such practices will not be rewarded in the future.
Let us look at the significance of abolition of footwear quotas from the perspective of the Third World. Canada has, in good times and bad, under all recent governments, avowed to help the Third World face the great challenges it does, to help Third World countries help themselves and to become more self-reliant in the world of today. While Canada has been generous in the provision of official development assistance, such assistance alone is not enough to enable these countries to survive in the world, to grow, and to become more self-reliant. These countries must receive private capital to develop their industries and be given trade opportunities to allow these industries to grow and realize their full potential. It is only if industrial development and exports from the Third World are encouraged today that these countries will have a chance to
join the trading nations of the world and be future partners for Canada in the world of tomorrow.
Footwear manufacturing is a growing area of potential exports from the Third World to the north. According to UNIDO Industry and Development Global Report 1985 the south's exports of footwear to the north-Canada included- increased from $.5 billion (U.S.) in 1970 to $1.5 billion (U.S.) in 1979 but then began to face import restrictions of various kinds.
Canada and other donors have provided billions of dollars of official development assistance as well as generous export credits to help Third World countries. Does it make sense, when the results of such assistance begin to emerge, to cut these short? Over the years since Canada began its international development assistance program it has, for example, provided more than $7 million to south Korea, more than $43 million to Brazil, more than $23 million to the Philippines, more than $46 million to Malaysia, and more than $68 million to Thailand, not to mention the more than $1.5 billion to India.
It is purely a coincidence that these are some of the countries that are emerging from the shadow of desperation in their recent pasts to become our potential, if not actual, markets of the future. Is it not a little short-sighted to consider, perhaps unwittingly, that we should retain footwear quotas that can only but alienate countries such as these which are also now the leading footwear producers in the Third World?
In conclusion, Mr. Speaker, the Government has concluded that the further granting of import relief to the entire footwear industry would be in neither the industry's nor the country's economic interest. If we are to export we must also import. It has become abundantly clear that import quotas can threaten jobs through retaliatory measures on the part of our trading partners. The international costs associated with the imposition of import quotas, however, is only one dimension of this issue. There are many others. However, it should be kept in mind that the Government's decision is consistent with the findings of the Canadian Import Tribunal which has conducted its most comprehensive inquiry to date into this industry. The tribunal is an independent body that has considerable expertise in conducting inquiries into imports into Canada. It is particularly familiar with the footwear industry, having conducted three previous inquiries into this industry. This was the fourth and, by far, the most comprehensive inquiry that the tribunal has undertaken to date.
I, therefore, am somewhat surprised that the Liberals, who appointed the members of the tribunal, set its terms of reference and have cited, with approval, extracts of the tribunal's report, are now attempting to ignore the tribunal's recommendations and conclusions. I am also rather surprised, Mr. Speaker, that members of the New Democratic Party are not prepared to take fully into consideration the interests of 25 million Canadian consumers, particularly low-income earners, in maintaining a viable and competitive Canadian footwear industry.
November 25, 1985


The Acting Speaker (Mr. Paproski):: Questions and comments. The Hon. Member for Richmond-Wolfe (Mr. Tardif).


Alain Tardif: Mr. Speaker, I listened with much interest and attention to the very academic and philosophical speech of my colleague across the floor. I must admit, Mr. Speaker, that 1 would probably have appreciated the meaning and content of his presentation had it been made in a university environment.
But that is not the problem, Mr. Speaker. The problem is that women and men who have been working for 10, 15 or 20 years in the footwear industry will lose their jobs in the months ahead. That is the problem, Mr. Speaker. And none of the speakers across the aisle has really explained how those so-called avant-garde measures will be implemented.
How would those people get another job and if they did, in what areas? My colleague opposite said a moment ago that the Liberal Government itself had commissioned this tribunal to study the situation but I will remind him, Mr. Speaker, that under the previous Government, the same tribunal made recommendations at one time and the Liberal Government of the day had the courage to make a decision not on the basis of philosophical or economic interests, but taking into account what Canada needs at the present time, namely jobs. 1 want to ask you this: What do you tell those men and women who, because of this devasting move, will lose their jobs-


Mr.   La Salle@: It has not been proven yet.


Alain Tardif: -in about a year or a year and a half? The Hon. Member for Joliette (Mr. La Salle) has a word to say. I believed him to be a strong supporter of the footwear industry. I am surprised that he does not have more to say in this regard. Answer my question.


The Acting Speaker (Mr. Paproski):: The Hon. Member for Dollard (Mr. Weiner).


Gérard (Gerry) Weiner: I will tell you how I will respond to my constituents and the citizens of Quebec and Canada. Three hundred thousand new jobs have been created this year and over 51,000 are in Quebec. Retail sales are up 8 per cent. New manufacturing orders are up 10 per cent. Look at the confidence in the country. Consumer spending is up. Retail sales in August were up 13 per cent as compared to a year ago. Motor vehicle sales are up 27 per cent. In my own community, Dollard des Ormeaux, building permits are going like hot-cakes. In the first seven months of 1985 the value of building permits was up by 17 per cent, manufacturing orders were way up and planned capital investment in manufacturing was up.
That is what I am prepared to say. The Government is going to continue creating jobs and ensuring that we put Canadians back to work.
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David Orlikow: Mr. Speaker, 1 would like to direct a question to the Hon. Member. During his comments he lectured members of my Party suggesting that we are not interested in the consumers because we asked questions about what the Government is proposing to do and that we are not interested in the welfare of people in Third World countries. Nothing could be further from the truth, Mr. Speaker. Our Party has always-


Charles Joseph Clark: Been on every side of every question.


David Orlikow: -supported programs to help people in the underdeveloped countries. We are, of course, aware of the extra cost to consumers.
I could support what the Government is proposing if 1 did not know what is actually happening in the real world. In the real world in all of the industrialized countries the shoe, clothing, and textile industries have been partially destroyed by increasing exports from countries in which the wage rates are a fraction of what they have been in the industrialized countries. The process of destroying those industries in continuing.
It may be, in a very theoretical way, that that is something which we cannot stop. However, if there is going to be a marked reduction in the number of people in Canada working in the shoe, clothing, and textile industries, I want to remind the Hon. Member that a substantial majority of the people who will lose their jobs live and work in his Province of Quebec. They are not all in Montreal. Many of them live and work in towns and cities in Quebec in which the shoe, clothing or textile industry is the only industry. What I have indicated to the Member for Dollard (Mr. Weiner) has been happening and will continue to happen. A city like Montreal, which the Hon. Member represents, or a city like Winnipeg which I represent, have a variety of industries to which people can move when a particular industry fails.
I am sure that in the next year we will be dealing with the same problems in the clothing industry and textile industry. What plans does the Government have for new industries for those companies which will have to shut down because they cannot compete with imports from low-wage countries? What plans does it have for new companies or for retraining workers?
If the Government could show us that it has an industrial strategy that will deal with these problems, then we would not need this debate and could agree with what the Government is proposing.


Gérard (Gerry) Weiner: Mr. Speaker, I have had the honour and privilege to serve as Parliamentary Secretary to the Secretary of State for External Affairs. For much of this year we have been concerned with Canadians who were threatened by protectionist measures in the United States. We heard from berry producers, the steel industry, the lumber industry and hog producers. Jobs in those industries were being threatened in

November 25, 1985
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Canada and in each instance we ran to Washington to beg for special measures.
If we are to be logical and rational, we must do something that will open those markets rather than close them. If those protectionist measures are implemented there, tens of thousands of jbos will be lost in this country. While we are asking for freer access to a market that we consider critical, it would be illogical to close ourselves to the rest of the world.
A plan has been put into effect to ease any suffering in one industry towns. That plan is contained in the report and the Minister for International Trade and the Minister of Employment and Immigration (Miss MacDonald) have alluded to it. That plan will be effective and continue to produce employment in our communities.


The Acting Speaker (Mr. Paproski):: Questions or comments. The Hon. Member for Winnipeg North has the floor.


Mr. Gagliano:: At the beginning of his remarks, the Hon. Member for Dollard (Mr. Weiner) mentioned that the Conservative Government had almost given in to the threats of the United States or the European Economic Community, or was afraid of them, and that it was for this reason among others that it had failed to maintain these quotas. I would like to know what the Member has to say about the fact that in this same promise that several Members read today, the Right Hon. Prime Minister (Mr. Mulroney) said that he would not give in to the pressures of the Common Market and the United States to reduce the quotas on imports of shoes and textile products in Canada. Also, the Hon. Member mentioned that he was very concerned about under-developed countries and that this action to remove the quotas on imports of shoes here in Canada would have helped these countries. Does he have as priority to safeguard the jobs of Canadians instead of the jobs abroad?


The Acting Speaker (Mr. Paproski):: The period for questions and comments is now over. Resuming debate. The Hon. Member for Saint-Leonard-Anjou (Mr. Gagliano).


Alfonso Gagliano: Mr. Speaker, since I did not get an answer to my question, I will continue debate on this very important motion. I certainly do not intend to read the Prime Minister's promise, as I think we have already done so on a number of occasions, but I would like to draw the attention of the House to the fact that the people of the riding of Saint-Leonard-Anjou are asking themselves today, after this about-face of the Prime Minister, and they are asking me: Is the Prime Minister a man of his word? On May 4, he said he was not going to remove the quotas, and now a year later, he is lifting them. It is not the first time he has made an about-face, Mr. Speaker. We saw this at the very beginning of his term, when he challenged the universality of social programs. He had said it was "a sacred trust", but nevertheless, he decided to challenge universality.
The House will recall the Budget brought down in May 1985, and the demonstration held by senior citizens. We had to bring our senior citizens here to Ottawa to make the Government understand that it should not de-index their pensions.
Mr. Speaker, I wonder whether, during the summer of 1984, when the Government promised Canadians the moon and whatever else it could promise them, it really intended to keep its promises. I think Canadians have been duped by all these promises.
Mr. Speaker, another promise was made when the Prime Minister said that once he had formed his Government, he was going to cut the paper burden that Canadian businesses had to deal with. And right away, in his first message on the state of the economy, the Minister of Finance (Mr. Wilson) said he intended to look into the added value tax system. In fact, it is systems like these that have at least tripled our bureaucracy and the amount of paperwork that has to be done.
Mr. Speaker, if we look at Europe, we see that over there, the system penalizes not just small businesses but all other businesses as well. It is a very complex system, a system that also tends to take money out of the pockets of the low- and middle-income consumer. However, the Government is not concerned about its promises, and according to some businessmen, some pressure groups are convinced that in time, the Minister of Finance will be announcing his new tax system.
Today, Mr. Speaker, we must ask ourselves: If footwear quotas are lifted, what is going to happen to the textile industry? The problem is exactly the same! Nevertheless, questions have been asked and the matter is being considered. Only today, the Minister for International Trade (Mr. Kelle-her) said they were looking into all this and that they would be making a decision. Considering the decision they made on the shoe industry, after giving us the same story, it is pretty obvious they will make the same decision to lift quotas, this time on textiles.
Mr. Speaker, thousands of jobs are at stake. We are not just talking about shoes and textiles but about jobs, and especially in the province of Quebec. We have a problem with Montreal East and now we will add other areas in Quebec which are affected by this decision on quotas in the footwear industry, and later we will add those in the textile industry, What is going to happen? Quebec will be completely shut down in the same way as the Prime Minister (Mr. Mulroney) shut down Shefferville.


An Hon. Member:: No, no.


Alfonso Gagliano: But that is what will happen. My hon. colleague does not like it. But this is reality. The Parliamentary Secretary said earlier that 302,000 jobs were created.
How come then that we lose 5,000 jobs in Montreal East? How come that 20,000 jobs are in jeopardy in the footwear
November 25, 1985

industry and that 40,000 jobs will also be in jeopardy in the textile industry? Are you going to tell us the same old story?
Nobody believes you when you say that. The proof is there. According to the polls published last week, 52 per cent of the Canadian people do not trust the present government. Why? After only one year. What will they say after four years?
Mr. Speaker, during Question Period we saw the Prime Minister hide behind the Antidumping Tribunal. He said: we have not changed, I did not break my promise. We had a report from the Antidumping Tribunal and we implemented their recommendations. But it is ridiculous to see a government let an antidumping tribunal tell it what to do. The Government did not have the courage to make its own decisions and to say after having analyzed the situation: Are we going to maintain quotas or are we going to remove them because we think this is what we should do? Of course not. The Prime Minister defends himself saying: I did not deny anything. 1 kept my word. I hid behind a report.
One only has to read the report to realize that it contains various options and that the quota system could indeed have been maintained.
Because I have a few minutes left, Mr. Speaker, I should like to read a letter which several Hon. Members have received also. 1 would like everybody to know the tragedy which Canadians, Quebecers especially, are going through because of this decision by a Conservative Government. It is a letter from the Shoe Manufacturers' Association of Canada.
Dear Mr. Gagliano,
As you know, before the end of November 1985-
This letter was written before the Government announced its decision.
-the Government will make a decision which will mean the life or death of the footwear industry in Canada.
If the Canadian Government decided to extend the quota system for a minimum period of five years, thereby ensuring the industry only 50 per cent of the Canadian market, it would get the support-
-of most members of the three federal parties;
-of the Quebec and Ontario Governments;
-of workers and trade unions;
-of manufacturers, tanners and suppliers;
-of the vast majority of the 4,500 small independent retailers;
Because, Mr. Speaker, these quotas do not affect only footwear manufacturers, but also retailers and even importers as well. Because, beginning December 1, there will be war, once these quotas are lifted.
-and especially-
I continue reading, Mr. Speaker.
-of 8 out of 10 Canadians (National Survey-Decima Research).
This decision which the Government is legally empowered to make would not only protect existing jobs but create 6,000 new ones, as well as encourage investment in the new technology.
If, unfortunately, the Government accepted the contradictory and unrealistic findings of the tribunal and followed the ill-advised recommendations of Interna-
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tional Trade officials, it would mean the death of our industry and 20,000 lost jobs.
20,000 families are anxiously waiting for the Federal Government to make a decision concerning the footwear import quotas.
We are counting on your full support to convince the Government.
It is too late, Mr. Speaker, the Government has made its decision and, as the letter said, has signed the death sentence of the footwear industry in Canada as well as decreed the laying-off of 20,000 Canadian workers.


Charles Joseph Clark: Mr. Speaker, I noticed that the Hon. Member proposed that we should ignore the report of the tribunal which his Party established.


Mr. Allmand:: Like you with the Abella Report.


Charles Joseph Clark: Would the Hon. Member tell us why the Liberals set up that tribunal if they intended to ignore it. Who were they trying to fool?


Alfonso Gagliano: Mr. Speaker, the Right Hon. the Secretary of State for External Affairs is saying that we ignored the report. Of course we are not telling you to ignore the report, but there were two versions in that report. If he were to read it closely he would know there was the version of the manufacturers, but it was more difficult to find the version of the importers.
As a Government you have to ask yourselves some questions. Why did some of the interested parties in the industry- importers, exporters, retailers-not even bother to appear before the tribunal and state their case? How is it that after reading the whole report one reaches the logical conclusion that quotas should be maintained? All of a sudden-


The Acting Speaker (Mr. Paproski):: I regret to interrupt the Hon. Member.
It being 6.04 p.m., it is my duty to interrupt the proceedings and put forthwith every question necessary to dispose of the business of Supply in accordance with Standing Order 63(9).
The question is the following one: Mr. Tardif (Richmond-Wolfe), seconded by Mr. Gauthier moved that this House regrets that the Prime Minister has once again broken an election campaign promise, this time by failing to maintain quotas on imports of shoes and by compounding this betrayal by failing to make adequate provision for the thousands of workers whose jobs are adversely affected. Is it the pleasure of the House to adopt the said motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


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

November 25, 1985
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Some Hon. Members:: Yea.


The Acting Speaker (Mr. Paproski):: All those opposed
please say nay.


Some Hon. Members:: Nay.


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


The Acting Speaker (Mr. Paproski):: Call in the Members.


Mr. Speaker:: 1 declare the motion defeated.


CANADA DEVELOPMENT CORPORATION REORGANIZATION ACT
[Stage Direction]
The House resumed from Friday, November 22, consideration of the motion of Mr. Hnatyshyn (for the Minister of Regional Industrial Expansion) that Bill C-66, an Act respecting the reorganization of the Canada Development Corporation, be read the third time and passed.
Hon. Herb Gray (Windsor West):: Mr. Speaker, 1 rise on a point of order. I wonder if there could be a disposition on the part of the House today to have the vote just taken with respect to the Supply Motion apply to the third reading of the Bill in question, although I suppose if I do not say this my hon. friend will insist the result be reversed.


Jean-Robert Gauthier: Mr. Speaker, if that is acceptable, I would like to declare my interest in abstaining with respect to the vote.


B. Keith Penner: Mr. Speaker, the same applies for me. If the vote were to be taken I would abstain because I have a declared interest in the Bill.


Mr. Speaker:: I declare the motion carried with two absten-sions recorded as indicated by the Hon. Members.
Bill read the third time and passed.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Lynn McDonald: Mr. Speaker, the questions I have raised which we are dealing with today-
Adjournment Debate
motion under consideration by the House. I would ask the Chair to ensure whether that was in keeping with the current practice established here-


Mr. Speaker:: I appreciate the Hon. Member's point. 1 am in two difficulties. First, because the moment the vote was taken we were in fact after six o'clock and therefore in the Adjournment Debate. Therefore, 1 am in some technical difficulty in recognizing the Hon. Member on a question of privilege, although 1 did. Second, in a matter such as this 1 think the correct procedure is for the Hon. Member to give me notice in writing of his question of privilege. We will deal with it in that manner.


Lynn McDonald: Mr. Speaker, the House seldom has the opportunity to deal with a life and death issue such as the one 1 have been raising, that is the matter of 35,000 Canadians who die every year as a result of tobacco smoking, the opportunity we have to reduce the problem, if not eliminate it, and the very particular question as to what we are doing as a society to encourage tobacco smoking through advertising.
The two questions I raised on November 19 dealt with the issue of cigarette advertising. First, 1 raised the general issue of policy, that is, the advisibility of advertising at all a product which is dangerous, as dangerous as tobacco cigarettes are. In reply to my question the Minister referred to other options to consider as well. He said:
I want to assure the Hon. Member that other policies on convincing Canadians that smoking is detrimental to their health will be forthcoming.
1 wonder how vigorous these policies are with a Government which has been so backward in dealing with this issue. 1 should add that preceding Liberal Governments have been exceedingly backward as well.
Let us look at the facts. The Government has come up with a $1 million counter-advertising program to encourage young people not to start smoking. At the same time the manufacturers are spending at least $90 million to encourage young people, in particular, to smoke. Of that $90 million, we are paying half as taxpayers. That is $45 million of the taxpayers' money in foregone tax revenues going to promote a product which is dangerous to health.


Mr. Speaker:: Order, please. Apparently, I have received a notice of a question of privilege. The Hon. Member for Saint-Jacques (Mr. Guilbault). Is it relating to the vote?


Mr. Guilbault (Saint-Jacques):: No, Mr. Speaker, the question of privilege I want to raise relates to an incident which occurred in the House today, and I would like to give notice to the Chair that, if need be, I intend to raise a question of privilege tomorrow. The matter I want to draw to the attention of the Chair is that, during the debate this afternoon, the Hon. Member for Sherbrooke (Mr. Charest), the Deputy Chairman of Committees of the Whole House, took the floor on the
What does this advertising do? Most of it is lifestyle advertising, if not all of it. It associates smoking with fresh air, health, success, friends and popularity. It preys on young people's uncertainties and anxieties. It offers easy solutions to the questions of acceptance and personality. Yet 35,000 Canadian die every year and, among them, 5,000 who are not even smokers themselves but who are passive smokers. We are not acting to protect these people.
The issue of advertising also raises the question of sponsorships because, increasingly, the advertising companies are trying to associate the arts and sports with their diabolical product. Let me point to one instance. On the weekend I attended at the Royal Ontario Museum for an extremely

November 25, 1985
Adjournment Debate
important exhibition on the Jewish legacy, the cultural artifacts of Jewish culture in Czechoslovakia which were gathered together by the Nazis. This exhibition is a memorial to the Holocaust. It was sponsored by a tobacco company, Phillip Morris. The film which announced and presented this extremely important material about a very disastrous period of human history was announced by the Phillip Morris Company. Yet the tobacco companies have been responsible for more deaths than the Nazis killed Jews during World War II. This is the terrible irony. The tobacco companies are trying to use culture to make their product seem to be one of life and vitality. It is unconscionable that companies which promote death and illness should be allowed to get away with that. What hypocrisy it is that the sports and the arts should be used in this fashion.
I would like to refer to the more particular question of the ad agency, McKim Advertising, which has received the Government's contract to do the English advertising in its countersmoking campaign. This is the same company which does the advertising for Imperial Tobacco. This, in short, is the same company which makes far more of its money promoting and encouraging young people to take up smoking.
The Minister came up with the rather sheepish excuse that the choice of the company had been made on the advice of six civil servants in his Department. He did not mention that the list from which those six civil servants made their selection consisted only of accepted Conservative advertising firms and that that particular advertising firm has had the Conservative business in the province of Manitoba. So we have a clear conflict of interest situation and the Minister's response to that is totally inadequate.
Studies show that smoking among children is still on the increase. Yet in other countries which have banned advertising, smoking among children is decreasing. Norway has a particularly good program, on which we might look at. It has a total ban on advertising of smoking and there has been a real decrease in the number of young people who take up smoking.
I regret to say that there has not been a decrease in the number of adult smokers. But the rate there is roughly half the rate of Canadian smokers.
Canadians would do well to realize how important this problem is. We have the highest rate of smokers in the industrial world. We are the fourth highest in smokers in the world. That means we have a proportionate amount of illness, disease and death as the result of smoking.
I, therefore, call upon the Government to be realistic and come forward with a strong program to counter tobacco smoking. I particularly urge the Government to institute a ban on cigarette advertising which could be phased in over a two-year period and then to get rid of it absolutely.


Mrs. Gabrielle Bertrand (Parliamentary Secretary to Minister of National Health and Welfare):: The Government of Canada, the Provinces and the Territories, supported by seven non-governmental health organizations, have just approved a
national program to fight tobacco smoking, to try and convince Canadians to stop or not to start smoking.
In January of this year, a federal-provincial task force was set up to develop a new national program. An invitation was also sent to non-governmental agencies that had come out against tobacco smoking. A national steering committee was formed, whose mandate included the three following objectives: First, to protect the health and rights of non-smokers; second, to help non-smokers remain so; and third, to encourage and help smokers to drop the habit.
To achieve these objectives, the committee adopted a nine-point strategy: To actively pursue the advertising campaign against smoking among the young; to promote actively health education in the schools and encourage students not to start smoking; to act through the community to show young people that the non-smoker is in; to provide effective and on-going programs to help smokers who want to stop smoking; to support the creation of special programs for high-risk groups; to make group programs more accessible to smokers who need a more sustained form of assistance; to support all available means to promote the advisory role of health professionals in dealing with smokers; to encourage the voluntary adoption of guidelines against tobacco smoking in public establishments, buildings and places; and to set up a follow-up mechamism for projecting and measuring results.
The program was inaugurated on October 22 of this year, in Ottawa and in the provincial and territorial capitals, by launching a series of televised messages addressed to young people.
The advertising portion of the campaign was designed by two advertising agencies: McKim for the English language campaign and Le groupe Marketel for the French campaign.
McKim Advertising in Winnipeg was chosen from a group of four advertising agencies designated by the Cabinet Committee on Communications. A jury of six public servants, including four from the Department, made the selection. The jury responsible for selecting the agency was aware of the fact that McKim's office in Montreal had the Imperial Tobacco account, worth about $2 million, and that there might be a conflict of interests. The jury asked for, and received from McKim the assurance, that their office operated entirely independently and autonomously, and that no conflict of interest existed.
McKim should be congragulated on having accepted this anti-smoking campaign contract in view of the potential risks as far as its well-paid contract with Imperial Tobacco is concerned.
I believe that McKim is doing an excellent job in this campaign. The Department has received favourable comments from professional groups, non-government organizations, the
November 25, 1985

medias and the Departments of Health of the provinces and territories.


ENVIRONMENTAL AFFAIRS-ST. CLAIR RIVER-CONTROL OF INDUSTRIAL POLLUTION. (B) PROVINCIAL ENVIRONMENTAL SECURITY FUND
Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, you will recall that on November 18 I asked a couple of questions of the Minister of the Environment (Mr. McMillan) concerning pollution in the St. Clair River which, as we all know, is of enormous concern to the people all the way down to Windsor who take their water from that river. It is also of enormous concern to my colleague from Windsor West.
Tonight I seek from the Government some assurance that it will not pursue a policy of believing that pollution can be resolved by diluting or dissolving the substances in our rivers and lakes, but that it will take a position which will go to the root of the problem for the sake of millions of Canadians and Americans whose health depends on the quality of water.
For too long, Mr. Speaker, we have depended on the hope that nature would somehow take care of the substances we are discharging into our waterways and that dissolution would be the answer. For decades we have relied on that principle only to discover, in recent years, that it does not work. In fact, substances find their way into rivers and beds of rivers and lakes, and eventually through evaporation of water bodies or other processes the chemical substances find their way into our food chain and endanger our health.
In the case of the St. Clair River we have heard abou the spill at Dow Chemicals. I want to ensure that the Government knows that that is not the only company operating along that river. There are some 15 plants located adjacent to the river including companies like Suncor, Esso and Petrosar. It is my understanding, Mr. Speaker, that some of these companies have direct sewer discharges into the St. Clair River. That means there is no intermittent discharging location such as a pond or other controlled area where the waters which are discharged by the plants can be analyzed before they are finally discharged into the river. Therefore, there is potential for pollution of the river which must be corrected.
In Sarnia and other places we must put into place preventive measures which will ensure that whatever is discharged into the river, whether or not by way of accident, is not toxic to the health of humans and the habitat. In order to do that we must improve our treatment and pretreatment of substances that are to be discharged. We are presently doing that only partially and only on certain sites where the industry is very modern and of recent construction.
I would feel much better, as I am sure every individual in Canada would, if we were to adopt a practice of anticipation and prevention of damage by ensuring that what is discharged into our waters and the air have no toxic or negative effects on our health. I submit, Mr. Speaker, that the time has come to
Adjournment Debate
change our attitude toward the environment. The experience in Sarnia is one which teaches us that we must make this change in our way of thinking. The fact remains, Mr. Speaker, that the toxic substances which we discharge do not disappear into water and air. They become part of the habitat and have long-term effects which we may regret a generation later.
Tonight I seek from the Government an assurance that rather than continuing to search for answers in the nature of curing and reacting to the damage after the fact, it will, jointly with industries and the communities affected, put into place measures which will anticipate and prevent spills of this nature from happening in the future for the protection of the health of large numbers of people whose water quality depends on that of the Great Lakes. I hope that the Parliamentary Secretary is in a position to give us this reassurance.


Gabrielle Bertrand: Mr. Speaker, the recent spill of perchloroethylene into the St. Clair River and the subsequent public attention it has engendered on the pollution of that river underscores the importance that citizens place on environmental protection. It is that same public concern which stimulated governments to sign the 1972 and 1978 Canada-U.S. Great Lakes Water Quality Agreements. Under those agreements successive administrations of federal and provincial governments have striven to strenghten pollution control measures with measureable results.
But it is recognized that much remains to be done, especially with regard to the control of toxic substances. In recognition of this need, governments around the Great Lakes are focussing attention on the "hot spots"; those problem areas in which environmental quality is degraded and requires special remedial action. Currently the International Joint Commission has identified 21 such areas in the United States; 12 in Canada, in addition to the 5 interconnecting channels including the St. Clair River.
In 1983 Canada and Ontario decided to join the U.S. agencies in undertaking a detailed study of the Detroit, St. Clair and St. Marys Rivers. The intent of the massive interagency study is to detail environmental conditions and pollution sources, to provide the scientific and technical basis for the development of specific remedial action plans for these areas. These plans are to be submitted to the International Joint Commission for review and the Commission will monitor the rate and effectiveness of the measures implemented under the plan. This action is currently under way at a total cost of some $8 million and will continue and be accelerated as required.
In addition to this major initiative, on November 1, the Minister of the Environment (Mr. McMillan) directed Environment Canada to undertake a short-term investigation to detail the extent and probable sources of the tarry substance, which is the current focus of public concern. That investigation is also underway and its results will be announced shortly, probably in mid-December. To the extent that further immedi-

November 25, 1985
Adjournment Debate
ate action can be taken, such measures will be implemented. The nature of these cannot be determined until the results of the study are in hand.
As is well known, pollution control is just as essential as it is costly. But it would be foolhardy to discuss cost before the immediate extent and sources of pollution are known and documented.


The Acting Speaker (Mr. Paproski):: 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 6.53 p.m.
[Stage Direction]
Tuesday, November 26, 1985