1986-03-17

Mr. Pat Nowlan (Annapolis Valley-Hants):: Pursuant to Standing Order 101, I have the honour, as co-chairman of the Canadian delegation, to table in the House in both official languages, the interim report of the Canadian section of the Canada-U.S. Interparliamentary Group, which met in Tucson, Arizona, from February 27 to March 3, 1986.
The report summarizes the discussion in the plenary meeting of the two delegations which was devoted to the subject of enhanced trade with the United States. As Members are doubtless aware, Congress presently holds the key as to whether or not President Reagan will be granted authority to negotiate such an agreement with Canada. The U.S. Trade Act establishes a rather complicated procedure. If, within 60 working days, Congress does not explicitly act to deny the President such authority, negotiations between the two countries may commence. The 60-day period expires about mid-April, so our meeting was held at a critical phase of the Congressional review. Adding to the significance of our discussion, the Congressional delegation included Members of the House Ways and Means Committee and the Senate Finance Committee who have the principal responsibility for reviewing the request.
Many Hon. Members of the House will be aware of the vigorous campaign which has been mounted in the U.S. Congress to restrict Canadian softwood lumber exports to the United States. Voices have been raised in the Congress arguing that the President should be denied approval to negotiate a comprehensive trade arrangement with Canada until Canadian lumber exports have been cut back. Our delegation warned our American counterparts of the very serious consequences of adopting such a procedure. If Hon. Members have the time to read the report, which I encourage them to do, they will see that we got our message across, we believe, to the American participants.
The report I am tabling today deals only with the plenary discussion. We had extensive discussions in three committees on subjects as varied as softwood lumber exports, the U.S. Farm Bill, the proposed U.S. oil import tax, acid rain and Arctic sovereignty. The detailed report of the three Committees' discussions will be made available to all Hon. Members as soon as it has been completed.
Canada has no more important relationship than our relationship with the United States. The U.S. Congress has a direct and substantial influence on the development of that relationship. These annual meetings, which were initiated in 1959 by Prime Minister Diefenbaker, provide an exceptional opportunity for Canadian Members of Parliament to put Canadian concerns directly to Senators and Congressmen. I believe that the House can be proud of the effective way in which our delegates represented Canadian interests.


PETITIONS
Mr. Barry Turner (Ottawa-Carleton):: Mr. Speaker, it is my pleasure and duty, particularly on this day, to honour St. Patrick, a man of peace, to present a petition from the Rideau Park United Church in my riding signed by 92 of my constituents who humbly pray and call upon Parliament to assign a high priority in its bilateral aid program to small-scale agricultural projects which build the confidence, skills and material resources needed to overcome hunger, and to commit itself to gradual and steady steps to untie its bilateral aid program.


Mr. John Parry (Kenora-Rainy River):: Mr. Speaker, I have the honour to present to this honourable House this morning, four petitions. Three petitions are signed by some hundreds of residents of Balmertown, Red Lake, Madsen, Emo, Dryden and Barclay, in my riding, and call upon Parliament to do everything in its power to prevent the operation of the premises known as the Morgentaler Clinic in the city of Toronto.


John Edmund Parry: I have a fourth petition which is again signed by some 100 or so residents of my riding. It calls upon Parliament to ensure that Petro-Canada passes on lower prices to consumers of gasoline in Canada.

March 17, 1986
Order Paper Questions



ELECTORAL BOUNDARIES READJUSTMENT ACT


Mr. Gilbert Chartrand (Verdun-Saint-Paul) moved: for leave to introduce Bill C-285, an Act to change the name of the Electoral District of Verdun-Saint-Paul.


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


Some Hon. Members:: Agreed.


Gilbert Chartrand: Mr. Speaker, I simply want to say that considering the fact that my riding consists of three very distinct areas, namely, the town of Verdun, a part of Montreal which is called Cote-Saint-Paul, and third, the very controversial area of Ile-des-Soeurs, I believe it would be normal to give the people of Ile-des-Soeurs the right to have the name of their area included in the riding of Verdun-Saint-Paul, which as I hope, would then become Verdun-Saint-Paul-Ile-des-Soeurs.


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


Some Hon. Members:: Agreed.


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


Some Hon. Members:: Agreed.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Doug Lewis (Parliamentary Secretary to President of the Privy Council):: Mr. Speaker, question No. 495 will be answered today.


Ms. McDonald: Has the Canadian Transport Commission, taken measures to protect the public and employees against tobacco smoke, pursuant to (a) paragraph 227(1)(/) of the Railways Act (A) sub-section 16(6) of the Aeronautics Act and, if so, what measures?


Hon. Don Mazankowski (Minister of Transport):: The
Canadian Transport Commission advises as follows:
{a) Although there are no Railway Transport Committee orders or Canadian Transport Commission regulations which
purport to protect the public or employees against tobacco smoke, CTC 1985-1 Rail, Regulations respecting Hygiene in relation to railways, Section 2(b) requires the maintenance of proper ventilation in passenger carrying cars. Operating Employees' Safety and Health Regulations, CTC 1983-7 Rail, Sections 57 to 61 inclusive, apply to employees engaged in the running and operations of trains and deal with airborne contaminants. Railway companies have their own bylaws which are pertinent to this issue.
(b)	As smoking on board aircraft may affect the health and safety of passengers, the Air Transport Committee is of the view that the matter more appropriately falls under the jurisdiction of Health and Welfare Canada and Transport Canada. Accordingly, the committee has not initiated any action in respect of this matter under subsection 16(6) of the Aeronautics Act.


Philip Derek Lewis: Mr. Speaker, would you be so kind as to call starred question No. 480?


Mr. Speaker:: The question enumerated by the Parliamentary Secretary has been answered.
Starred question No. 480: The Parliamentary Secretary.



STARRED QUESTION


Ms. McDonald: 1.	Are measures being taken to eliminate toxins due to cigarette smoking from (a) the Department of National Health and Welfare buildings (b) the Ottawa Airport expansion (r) other federal buildings and, if so. in each case, what are they?
2.	Are measures being taken to ensure that separate ventilation is given to smoking areas and, if so, what are they?
[ Translation]


Mrs. Gabrielle Bertrand (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, I would like to answer the question put by the Hon. Member for Broadview-Greenwood (Ms. McDonald), namely: Are measures being taken to eliminate toxins due to cigarette smoking?
In answer to (a) of the first question: An opinion survey of all employees of the Department of National Health and Welfare was carried out in August 1985 on the matter of cigarette smoking by employees. Subsequently a new "Smoking in the Workplace" policy was approved. In essence, the policy designates the workplace as a smoke-free area, provides specific locations in which smoking will be permitted during break periods, and provides a phasing-in period during which smoking employees will be offered cessation programs, a policy in force since January 1, 1986.
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As for Ottawa Airport, the Department of National Health and Welfare has held extensive consultations with the air carriers and their associations and the provinces regarding smoking in public places. Air carriers have voluntarily designated separate areas for smokers and non-smokers. The proportion of non-smoking seats continues to increase. With respect to the Ottawa Airport, it is our understanding that Transport Canada is considering designating air terminals primarily "non-smoking" areas.
As for other federal buildings, two other departments, the Department of Regional Industrial Expansion and the Auditor General, have smoking policies in place at this time. Treasury Board has indicated they are in favour of smoking restrictions and have asked the Medical Services Branch of the Department of National Health and Welfare to provide smoking cessation programs for federal employees.
As for the question: Are measures being taken to ensure that separate ventilation is given to smoking areas? The provision of separate ventilation for smoking areas is a complex issue because of the costs involved, the variation of building design and the fact that buildings are often shared with other departments. Officials of National Health and Welfare have been directed to investigate the possibility of separate ventilation systems in department facilities.
[DOT] (mo)


Philip Derek Lewis: I ask, Mr. Speaker, that the remainning questions be allowed to stand.


Mr. Speaker:: Shall the remaining questions stand?


Some Hon. Members:: Agreed.



MOTION TO ADJOURN UNDER S.O. 29 CANADIAN FORESTRY INDUSTRY

Mr. Speaker:: The Chair is in receipt of an application under Standing Order 29 from the Hon. Member for Hamilton Mountain (Mr. Deans).


Mr. Ian Deans (Hamilton Mountain):: Mr. Speaker, i regret that my letter was delivered late. However, it being Monday, and with the changes to the Standing Orders, it made it a little difficult for us.
As Your Honour knows, we filed with you the following letter:


Mr. Speaker:: Given the impending action of the U.S. Congress, scheduled for Wednesday of this week against the interests of the Canadian Forestry Industry and the inevitable crisis such action poses, we believe it imperative that the House of Commons make its views known immediately to the U.S. Congress.
We request your permission, under Standing Order 29, for a special debate.
If I could, Mr. Speaker, I would like to add one comment to the end of the letter. This would be a matter which might normally be delt with under opposition day motions. However, my concern in that regard is that because a motion put on an opposition day is inevitably a motion of non-confidence, it would be extremely difficult to encourage members of the Government to support such an action. As Your Honour knows, it is not possible to waive the non-confidence nature of a motion on an opposition day-at least it does not appear to be, even though the Standing Orders might allow it. Although it is possible to have a debate, it is not possible to have it concluded with any type of action taken by the House of Commons.


Mr. Speaker:: First, I would like to say to the Hon. Member that the application was received somewhat late. For reasons which will become clear in what I have to say, 1 chose to accept it and say something today precisely because of the reason the Hon. Member raises. That is to say that if the Chair is to say something it seemed useful to say it today, before tomorrow and the next day, given what I think is the accepted importance of the subject.
I think the Hon. Member anticipates what the Chair will have to say in this situation, that is, the Chair has to cope with two issues. First, there is the genuine emergency of the subject. Second, there is the urgency of debate for Members; or, in other words, the opportunity for a debate on the subject. As the Hon. Member well knows there are two days scheduled- tomorrow and the next-for the Opposition to determine the subject of debate.
While I appreciate what the Hon. Member is saying about a votable opposition day, he will know that an application under Standing Order 29 merely produces a motion to adjourn. Therefore, it seems to the Chair that even with the constraints imposed, perhaps on a votable opposition day, even a non-votable opposition day is a better proceeding for the Hon. Member's purpose than is a simple motion to adjourn.
On that basis and, more important, on the basis of the question of the urgency of debate, the Chair is inclined to reject the application under Standing Order 29.


Ian Deans: Mr. Speaker, on a related but separate matter, then, will the Chair permit me to request of the House of Commons its unanimous consent to move the following motion:
That this House express its grave concern over the action proposed to be taken by the U.S. Congress against the importation of Canadian softwood and request the Prime Minister convey our concern to the U.S. administration.
If there were unanimous consent for such a motion to be moved, then I would be pleased to move it.


Mr. Speaker:: That is apparently a request to revert to Motions. The Hon. Member knows that I appreciate his dilemma since he had to wait for a decision with respect to his request under Standing Order 29. There is a request of the House for unanimous consent to revert to Motions.

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Hon. Ray Hnatyshyn (President of the Privy Council):: Mr. Speaker, we on the Government side have great interest in the issue raised by the Hon. Member for Hamilton Mountain (Mr. Deans). I think he would expect me to consult him in advance of such a motion asking for unanimous consent, as well as consulting with the House Leader of the Official Opposition. Under the circumstances, I think that would be the more appropriate way to proceed prior to giving unanimous consent. Accordingly, I am not in a position to do that since I have not had a chance to discuss the matter with the Hon. Member.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Thursday, March 13, consideration of the motion of Mrs. McDougall that Bill C-99, an Act to provide borrowing authority, be read the second time and referred to a legislative committee.
Hon. Herb Gray (Windsor West):: Mr. Speaker, the Bill before us asks Parliament to authorize the borrowing by the Government of $22.6 billion. I wish to ask the House the following question. How can we of the Official Opposition, or Members generally, support this Bill when its purpose is to enable the Government to borrow money in order to have the Government carry out its budgetary and general economic policies?
As the months go by what is wrong with these policies is becoming increasingly and painfully obvious. During the last general election campaign the Conservatives made a number of promises to win the support of Canadians. I would say that the Economic Statement of last November, 1984, and the two Budgets of this Government, have not in any positive way reflected the types of promises the Conservatives made in order to win the support of Canadians. For example, during the last election campaign the present Minister of Finance (Mr. Wilson) made an explicit commitment not to increase income taxes. The present Prime Minister (Mr. Mulroney) pledged to reform the personal income tax system. He said that he wanted to make it "more fair, more progressive and more productive". However, it is clear that, in spite of these promises by the Minister of Finance and by the Prime Minister, middle and lower-income Canadians have become the victims of the most unfair, regressive and economically stifling tax increases on record, brought about by the Budget of last May and the Budget of last February presented to the House by this Conservative Government.
The Leader of the Opposition (Mr. Turner) spoke very forcefully in the House of Commons debate on the Budget a few days ago. In that debate, he said:
We will take this Budget as the second phase of the Budget last May. Phase one was the Budget of last May and phase two is the Budget of February. Together these two Budgets constitute the greatest, cumulative, hidden, regressive tax increase in Canadian history. They attack the average Canadian family earning between $15,000 and $40,000 in a brutal fashion.
We have reached the stage . . . where the person between 35 and 55 years old finds himself or herself in a position, with the added burden of tax slapped upon him or her, that it is. . . impossible to maintain a standard of living because the cash flow available to the average Canadian has been absolutely crippled.
This is confirmed as each individual Canadian looks at his or her pay cheque each week.
An indication of the growing concern of middle and lower income Canadians is the fact that just one request by the business editor of The Toronto Sun, a paper which is generally supportive of the Conservative Government, has in the course of only 10 days brought into that newspaper some 15,000 coupons protesting vigorously the unfair increase in the burden on middle and lower income Canadians caused by the Budgets of this Conservative Government.
After only one request by a newspaper which is supposed to be a supporter of the Progressive Conservative Government,
15,000	coupons from individual Canadians were sent to the newspaper.
Any objective measure of the impact of these two Conservative Budgets on middle and lower income Canadians shows the undeniable reality of their unfairness and injustice. The tax burden is not equally distributed. Over the next three years, according to the Budget figures of the Minister of Finance, the federal Government will impose an additional $12.5 million in personal income taxes, and corporate taxes will increase by only $1 million. Over the next four years, a family of four living below the poverty line on an income of only $15,000 per year will suffer a 23 per cent tax increase, while a family of four with an income of $35,000 will suffer a 13 per cent tax increase. Yet a family of the same size earning $200,000 will suffer only a 1 per cent tax increase. This is not fair.
The $500,000 unconditional lifetime capital gains tax exemption provided by the May, 1985 Budget is still in place and middle and lower income Canadians are still hurting. That hurt is going to increase as the measures proposed by the Budget of February click into place and show up over and over again in the pay cheques of middle and lower income Canadians. The Leader of the Opposition provided a clear example of this continuing inequity when he said in the House the following:
An individual with an income of $40,000, based on a salary of $35,000, plus $4,000 in dividends, plus interest of $1,000 faces a tax increase from 1986 to 1987 to 9.4 per cent. An individual with an income of $150,000... based on a salary of $100,000, $15,000 in dividends, $5,000 in interest and $30,000 in capital gains, in the same period has an overall tax decrease of 1.4 per cent.
Again, this is not fair.
Since the Conservative Government has been in power, the federal sales tax has increased from 9 per cent to 12 per cent.
March 17, 1986

Not only has this particularly regressive tax been increased, but its application has been broadened to include non-prescription health care products, soap, shampoo, candy and even pet food. These measures hit hardest at lower income Canadians. The truth of the matter regarding the proposed $50 sales tax rebate for low income Canadians is that the Conservative Government is providing the false impression that it is granting these lower income Canadians an escape from the negative impact of its sales tax increases. This paltry political gesture is completely overwhelmed by the much greater increases in sales tax, on gasoline for example. In fact, sales taxes are increased on cigarettes and alcohol and the sales tax portion is increased on every larger ticket item required to furnish a home.
For example, a poorer family needing a refrigerator, a stove or a washer costing approximately $600 is going to pay 12 per cent in federal sales tax and that amounts to $72 for just one item. That is a lot more than the sales tax rebate for which the Conservatives are trying to take such credit as being something that will wipe out the negative impact of these unfair increases in sales tax. Obviously the sales tax rebate, this sales tax credit, will only help wipe out the negative effect of the sales tax increases to a very minor degree.
Furthermore, only income earners below the $15,000 level are eligible for this tax credit. A four-person family living below the poverty line with an annual income of $15,000 to $20,000 will not receive this $50 sales tax rebate. In other words, the federal Government has unilaterally redefined the poverty line. Statistics, Canada, the federal Government's own objective statistical analysis agency, has said that the poverty line is in the area of $20,000 to $21,000 annually. What is happening to families earning between $15,000 and $20,000? Why are they not getting the sales tax rebate? Poverty exists at the $20,000 level whether or not Conservatives are willing to admit it. The Minister of Finance and the Prime Minister are exhibiting an unparallelled insensitivity and profound carelessness about the economic plight of middle and lower income Canadians.
The May, 1985 Budget inflicted such gross injustice on senior citizens that the Minister of Finance and his heartless Conservative Government were forced by public outrage and the pressure exerted by Liberals and other Opposition Members to back down and withdraw the measure to deindex the Old Age Security benefits system. Just as it was our duty to protect Canadian pensioners, it is now our responsibility to protect Canadian families and indeed the entire middle class from the Conservative Government's contemptuous disregard for the principle of fairness.
With the continued presence before the House of the unfair and regressive Conservative Budget of last May, and with the voting into law by the Conservative majority of the unfair and regressive measures in the Budget of February, we should not allow the Conservative Government to get the authority to borrow sought by this Bill, because it will only use it to carry forward economic policies which have already been demonstrated to be unfair and heartless to middle income Canadians. We should reject the Budget of last February and we should
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reject this Bill which is so closely linked to it in its unfairness and regressive impact on middle and lower income Canadians.


Mr. Mike Cassidy (Ottawa Centre):: Mr. Speaker, I want to comment on the Borrowing Authority Bill, particularly because it was brought before us last week, as was the Nielsen Task Force Report, presented by the Government as one of the means by which it intends to counter the deficit and bring down Government spending. I wish to comment on that because of a couple of things which concern many Members of the House and people across the country as well.
One of these things is a matter which touches on the credibility of all of us. I speak specifically of the fact that all of us participated in the election campaign of 1984 and perhaps in previous election campaigns. We made promises. When I and members of my Party make promises we do so with the intention of keeping those promises. But when the Nielsen Task Force Report came out last week we found that it contained many options and recommendations which directly conflicted with promises that were made by the Progressive Conservatives when they were running for office in 1984.
We asked in the House whether the Government would be prepared simply to announce or indicate that options put forward by the task force which conflicted with Conservative promises would not be put on the table or would not be proceeded with. We asked that because we wanted to try to find out the worth of a Conservative promise. We are greatly concerned about the speed and the degree to which the Government has appeared to have forgotten promises which it made in 1984; in fact, it has gone directly against them. Unfortunately, rather than saying that it understood our concerns and that any options which conflict with announced Conservative policy would not be proceeded with, the Government remained silent. The Deputy Prime Minister (Mr. Nielsen) indicated that everything was on the table, that all these matters would go before the parliamentary committee which would consider the various recommendations of the Nielsen report. This means that the Conservatives, no matter what they promised in 1984 to gain power, are prepared to throw it away and think that the Nielsen task force has a better idea.
I raise this almost as a matter of privilege. When a Government breaks promises, as blatantly and as wantonly as has this Government, when it indicates that any promise is up for grabs if a bunch of outside, non-elected experts from the private sector and from Government think they have a better idea, it puts into jeopardy the credibility of promises made by any politician. Also it leaves the public increasingly up in the air and increasingly cynical about politics. People are justified in thinking that when they elect a Government, they give it a mandate to do certain things or not to do certain things. If the Party for which they vote makes particular promises, they are justified in feeling there is a good chance that the promises will be fulfilled. The electorate is realistic enough to realize that circumstances change and that perhaps some promises cannot be fulfilled. However, it is reasonable for them to feel that for

March 17, 1986
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the most part the promises made will be fulfilled, or that a Government elected to fulfil certain promises will do its utmost to fulfil them, even if all of them cannot be fulfilled within the four-year period between elections. Unfortunately we see something quite opposite as far as the Government is concerned.
1 should like to turn to the question of services and subsidies to business, the most substantial part of the Nielsen task force report. The task force indicated that that one area accounted for about $16 billion of tax expenditures and of direct Government expenditures, a major part of Government spending. As we pointed out, the concessions and tax expenditures made to business in fact exceed by about $7 million or $8 million the amount which is now being received from the corporate sector in tax revenues. It seems to me that this puts the whole situation of Government topsy-turvy. One would have thought that they would have been making a contribution to other services rather than taking away from it.
I should like to refer to another important matter. Even though the figures of the Nielsen task force are somewhat suspect, it is estimated that some $36 billion in tax expenditures is made by the Government of Canada every year and should be very seriously considered in looking at ways of restoring Government revenues or bringing down the deficit. On behalf of all New Democrats I should like to say that we, like most Canadians, favour means which present themselves for eliminating inefficiency in Government and for saving money.
I have been an alternate member of the Standing Committee on Public Accounts. On matters such as defence contracting and government management of its real estate in Ottawa, this non-partisan or all-Party committee has been very tough and effective in terms of protecting taxpayers, working with the Auditor General, and finding ways by which things can be done more efficiently and effectively. However, last week we had the recommendations of the Nielsen task force, which was supposedly to promote efficiency and effectiveness. Instead, it seemed to devote itself mainly to cutting services, which affected a wide range of Canadians, such as a number of grant programs, among other things, that benefited small and medium-sized businesses. At the same time it ignored a lot of tax expenditures and major concessions which, for the most part, benefited very large corporations. We have some real difficulties with those matters.
I should like to refer to the process by which opposition Parties were given a chance to comment upon the Nielsen task force report. I do not find it to be satisfactory. It contained
15,000	pages and goodness knows how many zillions of words.
I think we received two copies of the report in my caucus an hour before the documents were tabled in the House of Commons. In that period of time we had to look at these matters and try to come up with some early conclusions. Realistically, we all know that the press looks for response from the Opposition Parties and that because of its deadlines it is not prepared to tolerate an opposition Party which says that the report is very interesting and that it intends to lock itself
up for two or three days in order to look through the documents before returning with a reasoned response; we could not do that. The Government is just as aware as members of the Opposition of the way information passes through this Parliament. It should have been aware that effectively it was aiding and abetting; it was encouraging what inevitably had to be a somewhat superficial and sketchy overview of the Nielsen task force report when the opposition Parties first had a look at it.
Since last Tuesday I have had a chance to look at the documents a bit more carefully. I want to comment on the portion relating to services and subsidies to business. Some of the press and academic commentators have suggested that we New Democrats were perhaps a bit quick off the mark in condemning the particular report because of its general comments suggesting that grants and tax concessions were piled on top of each other, that Canadian businesses had become program junkies and that something should be done about reducing the over-all level of the various subsidies to a more reasonable amount. When it comes down to the evaluation of specific programs, some of them are matters with which we as New Democrats agree. Now that I have had a chance to look at the report in more depth, I should indicate that our problem is that it was a task force review, a study team which looked at the mote but not at the beams, if I can use the biblical analogy. It looked at the small things quite carefully and in some cases quite helpfully. For example, I cite the study team's review of the Government's real property management.
I found it to be quite constructive and in fact to contain a great deal of useful suggestions.
However, when it came to subsidies and services to business, we began with the major programs of tax expenditures which are devoted to accelerated depreciation, investment tax credit and a number of other areas. In those areas which are worth many billions of dollars, the study team simply did a job that in my view was inadequate. For example, on page 73 the task force admitted in relation to accelerated depreciation: "We are advised by the Department of Finance that there are no accurate means of measuring the incremental effect of this tax measure. While most difficult for Finance to evaluate, our impression based on discussions with them is that they believe this objective is reasonably satisfied". That is the sum total of the scientific evaluation evidence on which the study team made the following decision: "The study team recommends to the task force that the Government consider retaining the concept of accelerated depreciation". According to its figures which are in fact mostly out of date, it reckoned that in 1980-81 that particular concession cost taxpayers about $5 billion. It used six or seven pages to deal with that particular concession. The study team looked at it in a superficial way but did not really consider whether there were better ways of doing it more efficiently and more effectively.
I know my time is up, but I come back to my comment. If the study team had dealt as seriously with the big programs that have made program junkies of big business as it dealt with grants and subsidies, which if taken away would jeopardize regional development or small business, then I think the report
March 17, 1986

could be taken much more seriously. We intend to be pursuing these themes in the coming weeks as we get a chance to look in more detail at the Nielsen Report as one of the ways to reduce the Government's need for deficit financing.


Hon. Bob Kaplan (York Centre):: Mr. Speaker, the Liberals cannot let this Bill go by without doing everything possible to bring to the attention of the Canadian people what is wrong with the policies of the Government in this area.
This Bill is to authorize the borrowing of $22.6 billion. Of course, a borrowing Bill cannot be examined as an item alone, but with two other streams; one being the Budget in which the Government indicates how, through the tax system, it intends to raise money, and the second being the plans of the Government to reduce its spending by cut-backs in social and other programs. When you look at these three streams together, I think you can see the difference.
I hope it will not pass unnoticed by Canadians the important differences between the way in which the Liberals and the Conservatives would operate and the way in which the Conservatives are handling the responsibility they have to govern the country.
To begin with it should be recognized that we are in a period of economic growth in Canada and in the United States. While the Canadian Government today would want us to believe that it is totally the result of its own activities and policies, I think more moderate and reasonable observers would have to say it has quite a lot to do with the economic cycle in general and with international development. In any event, at a time of economic growth it is appropriate for a Governmnt to address its deficit and to try to bring in policies to assist in managing the deficit.
We see in this Budget, in this borrowing Bill and in the announcements made about cutting back programs, that the Government is addressing the problem of bringing down the deficit. At this time, a Liberal Government, if there were a Liberal Government in power, would also have to put forth programs to address the problem of the deficit that would tend to control it. However, the way in which the Government is reducing the deficit needs to be noted. What the Government is attempting to do through the tax system is to bring in a very large tax increase.
I began by indicating that if there were a Liberal Government in office there might also be a need and a recognition of a need to increase taxes, but the kind of tax increase that is being brought in by the Government is one which could never be brought in by a Liberal Government. It is a tax increase which bears very unfairly on middle and lower-income Canadians, while at the same time it has the effect of reducing and progressively reducing the tax burden on those in the Canadian economy who are the most able to shoulder an increase.
It is as if the Minister of Finance (Mr. Wilson) had taken his philosophy of there not being enough rich people in Canada and using the tax system to assist the rich to get even richer. How else can the Government explain the across the board
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capital gains tax exemption of $500,000 per taxpayer introduced in the previous Budget? The Minister of Finance tried to defend that measure by saying it would add to job creation, and that if it helped the rich it would also help the poor by creating more jobs.


Mr. Blenkarn:: It has.


Robert Phillip Kaplan: As our leader, the Leader of the Opposition (Mr. Turner) noted, this measure also benefits the individual who wants to sell a home in Florida or on the Riviera or who wants to sell oil paintings. The tax benefit is so broad that it almost discourages job creation by providing an incentive to the person to take advantage of a capital gains exemption. I see the Hon. Member for Mississauga South (Mr. Blenkarn) disagreeing with me, but I think he too would have to agree that that measure is more of an incentive to sell a business, if you own one, than to build one. When the statistics are available I am sure they will show that, far from creating jobs, the exemption encouraged people who could benefit from it to sell and convert their assets into less productive assets than business assets and the kind of assets that would increase the number of jobs in Canada. That is why the Liberals can say to Canadians that the tax increase introduced by the Government, however necessary a tax increase was, was not a fair one.
I want also to point to a second element of that tax increase, which was to increase the sales tax from 9 per cent to 12 per cent. Economists agree about very little, but they do agree that a sales tax is a regressive and an inflationary tax. The lower your income, the higher the proportion of your income you have to devote to consumption, to maintaining your family and yourself. Because this tax burden is on sales and is increased so dramatically, it too falls more heavily on middle and lower-income Canadians. People who want to buy a refrigerator or a washing machine, the ordinary things of life for middle and lower-income Canadians, will be more heavily taxed by the increased sales tax. An unacceptable burden is placed through the increase in sales tax from 9 per cent to 12 per cent. The tax also bears on gasoline. It has already been indentified that gasoline is a commodity which is too heavily taxed in Canada. Rather than recognizing that, the Government has stepped right in and increased the burden. It may at one point in our history have been viewed as a kind of an excise tax, a tax on luxuries, but tax on gasoline cannot be viewed in any sense of the word as a luxury. Automobiles have been scaled down over the last few years so they consume much less gasoline than they used to. Even the larger automobiles consume less gasoline that they did. In Canada the automobile is mass transportation. You tend to think of mass transportation as public vehicles, buses, streetcars and subways. But that is only true for a very small minority of Canadians. For most Canadians, and for the average Canadian, an automobile is mass transportation. To increase the cost of gasoline through the sales tax increase is to increase the cost of living for average and lower income Canadians. Cars are a necessity of life for most Canadians.

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There is an increase in the sales tax on diesel fuel as well. Food, products in stores, all of these things have a large transportation component and the Government is watching inflation escalate and multiply as it increases the tax on gasoline and diesel fuel.
Perhaps most recently identified is the impact that gasoline prices have on tourism. The Government has launched a fresh initiative to try to attract more tourists to Canada. We wish the Government well with that initiative. With gasoline in Canada so much more expensive than it is in the United States, how can the Government hope to attract the level of American tourism which it feels we need without recognizing that what the Government has done to the price of gasoline will be a very big factor in making it difficult to sell Canada as a tourist destination.
In conclusion, Mr. Speaker, the borrowing Bill is not acceptable because it is part of a package of measures which decreased the burden on those who are better off and increased the burden on the rest of Canadian society. That is unacceptable to the Liberals.


Mr. Howard McCurdy (Windsor-Walkerville):: Mr. Speaker, I do not stand before this House to support this borrowing Bill. The reasons for that have been indicated by previous speakers in varying degrees. It is necessary to once again call attention to the general thrust of the Government's policy as reflected in its Budget and Estimates. They indicate the degree to which it has failed to fulfil its responsibilities to the Canadian people. As a new member of the House I am greatly concerned to see so much evidence of the fact that politicians are driven with too much momentum to respond to immediate concerns in the short term and fail to regard the importance of long-term policy for the future of the country.
The Government rushes to develop policies which will attract attention and gain immediate plaudits, yet fails to consider the future. The Government constantly claims to be concerned about Canada's destiny. Yet, among the important considerations for the future of a country are the problems of young people. The Government has not seen fit to develop a positive focus of policy for youth. To the contrary, it seems to have chosen youth as a target.
I do not intend to belabour points which have previously been made and which are now being dramatically illustrated by other events, a process which I hope will continue. Due to all that has happened over the last few weeks, perhaps at long last the Government will be driven to provide the focus on youth policy which so many young people in the country are seeking.
It is important to work with, and not on, young people. It is necessary to develop a sound educational system in the country and to develop a policy with respect to the funding of postsecondary education. There is an urgent need for the federal and provincial Governments to work out a means by which funding can be provided to create a university system which
will reflect the intended status of the country in the economic world, and will as well ensure that all young people in the country have the opportunity to develop skills which will provide them with a role in our economy, and a basis upon which they can contribute to that economy and achieve personal success and achievement.
Instead of arriving at a reasonable understanding with the provinces, the Government has in fact cut back its over-all contribution to post-secondary education over the next five years, by reducing the rate of escalation of transfer payments. This issue has been discussed in other contexts to which we gave some attention in our previous intervention.
This morning I want to discuss the utter failure of the Government to live up to its promises with respect to the funding of research and development. I indicated previously that perhaps the Government is on a hastened trek to become second to Monaco in international research. We are already far behind all other industrial nations in the world in our commitment to research. The Prime Minister (Mr. Mulroney) recognized this. He said long ago that it would be necessary to double the proportion of our Gross National Product which we contribute to research. Over the last several months a number of sources have articulated the need for Canada to do much more to provide an educated and trained workforce and, as well, to ensure that the research community in the country can play its proper role in ensuring that Canada will achieve the economic development which the Government claims to be pursuing.
The Government is concerned about the deficit but, as has been indicated so frequently, has taken the wrong route to dealing with it. Our deficit will continue to exist for as long as we fail to achieve the level of economic growth of which we are capable. In fact, the Minister of Finance (Mr. Wilson) said that for 100 years we depended upon our resources and in the next decade we will have to depend upon our wits and intelligence. It is too bad that the wit and intelligence of the Government does not reflect what is required for the future.
Numerous studies have identified our short-comings in the area of research. If we are ever to achieve first-rate status as a country beyond our resource-based past, we must develop educated and trained personnel in a number of areas. We must make a far more significant effort to ensure that our universities are capable of supporting excellence in scientific social research.
The response to this has been illusion, delusion, and prevarication. The Secretary of State for External Affairs (Mr. Clark) announced grandiosely that the Government was going to provide an additional $1 billion for research. This is against a background of the National Science and Engineering Research Council alone identifying, in its five-year plan, a need for an additional $1.4 billion. The Social Sciences and Humanities Research Council identified the need for an additional nearly $200 million.
In fact, the National Sciences and Engineering Research Council was provided with an additional $126 million up to 1990. Where is the additional $1 billion for research to come
March 17, 1986

from? The Government has provided a pig in a poke. It has committed itself to trivial amounts. If industry provides an additional $350 million, the Government will add another $350 million. Adding that to the basic increment which has been promised, the total is $1 billion. They are not going to get it. While all this is going on, science and technology research grants to universities have been cut by 4 per cent. Equipment grants have been cut by nearly 50 per cent. Our best university has now been described as almost second rate.
This Government is failing to live up to the very needs it has articulated. It has to fulfil its promises and come to grips with the need as it exists. If it does not, it will have disgraced this country and, as has been said by so many people, we will become a Third World nation economically, and the deficit we will have then will make today's deficit blush in comparison.


Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, through Bill C-99 the Government is asking permission to borrow $22 billion. I really do not think we can trust this Government with $22 billion. When it comes to money this Government gets very confused. Members of the Government really do not know where they are or what they want. They do not know how they are going to get it, where they should get it, where they should spend it or where they should cut it. They do not really know why they should cut it. They do not know what they are doing. Look at the numbers on which this Government has based its budget forecasts. Dare I say it, it is a bit of the Minister of Finance's and Prime Minister's blarney.
In the budget document entitled Towards A Sustained Expansion: Canada's Economic Prospects, 1986-1991 the Government has contradicted itself. On page 23 the Government says:
In the Economic Outlook and Fiscal Plan documents presented with this budget, the assumption made is that the average selling price for a barrel of oil of quality equivalent to Sauda Arabian light will be U.S. $22.50 over the rest of 1986.	'
However, if you look at page 20 and Table 4 entitled "International Economic Prospects", under the column 1986 oil price you see the price for Sauda Arabian light crude petroleum at U.S. $23.88 a barrel. Within four pages of the same document the Government has predicted two different prices as the average price for 1986. Aside from that, the price has already been much lower than those figures. We are almost one-quarter of the way through 1986, so in order to get that U.S. $23.88 a barrel price, it will have to be much higher on average for the remainder of the year. Today, March 17, we are looking at oil at U.S. $12 a barrel. These figures are completely out of whack. They are ridiculous, and this from a Government which is asking us now for another $22 billion. 1 ask you, Mr. Speaker, can we trust this Government with any money, let alone an additional $22 billion?
Members opposite should check today's newspapers to find out what the current predictions are for the price of oil. As I am sure many Members are aware, the OPEC countries met
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over the weekend but were unable to agree on a way of stopping falling world oil prices. The Sauda Arabian Oil Minister, Sheikh Yamani, has predicted oil prices may go down to U.S. $8 a barrel, a far cry from the estimate the Minister of Finance (Mr. Wilson) presented in the Budget Papers. That price would mean the Government is underestimating the deficit by billions of dollars.
As well, on page 27 of this same document it says:
-it is assumed that the recent downward pressure on the Canadian dollar will be temporary so that, in conjunction with the widespread view that U.S. interest rates will decline somewhat in 1986, the level of short-term interest rates is assumed to average 9.5 per cent in 1986-
Interest rates today are considerably higher than that. Once again, he is saying that for the balance of the year interest rates are going to be considerably below 9.5 per cent in order to average out at that figure. However, that is not going to happen under the policies of this Government.
What does all this mean? It means the inadequacies of this Government will exacerbate our financial problems and reduce even further the confidence other countries have in the Government and economy of Canada. The results will be disastrous for Canada.


Mr. Stan J. Hovdebo (Prince Albert):: Mr. Speaker, I am pleased that the Government has taken some action on the procedures this House follows in dealing with the Budget, borrowing authority and our financial structure. Bringing in the Budget, the Estimates and Borrowing Bill all at the same time is something that seems worth while and does give Canadians in this Parliament a better opportunity to look at the structure of finances. The Government is to be congratulated on making that move.
Having said that, I and other members of my Party have supported this move and feel that it will be of some value. It becomes obvious that you can put the procedure in place properly and not have much effect on the actual structure of financial planning that the Government makes. In this particular case it is not helping us a great deal that we have gone through the procedure of putting the Borrowing Bill before the House at the same time as the Budget and the Estimates. We still do not have in place the policies and the financial planning necessary to eliminate the deficit, which this Government has so obviously made a central issue in this case.
When the people of Canada can look at the whole package they are better able to judge the cause and the effects of the measures taken by the Government. That might be a very good thing when the Minister of State for Finance (Mrs. McDou-gall) and other members of the Government are moving across the country attempting to sell the Budget, to sell confidence in what the Government is doing. The Government has been travelling across the country selling its product, but that selling of its product has become a little suspicious.
A couple of Cabinet Ministers have visited my constituency in the last few weeks, giving probably more attention than Prince Albert has gotten since that unsuccessful invasion

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during the last election when 57 members of the Conservative caucus appeared in Prince Albert, several of them several times. The Minister of Transport (Mr. Mazankowski) and the Minister of External Affairs (Mr. Clark) were in my constituency several times during the election.
This time the Government is trying to do two things. It is trying to sell the Government decision. It is trying to put across a fairy tale about the effect of its Budget. The Minister of Labour (Mr. McKnight) visited Prince Albert and several other Saskatchewan points, and in Prince Albert he announced the construction of a federal building, a project for which no money is provided in the Estimates and for which no plans are apparently ready. However, it is going to proceed. There is a commitment anyway, and I thank the Minister for that commitment. It may proceed in 1987-1988, and we hope he gets the money in the Estimates at that time. This move is obviously an attempt to sell something the Government didn't really have. It made this move in Saskatchewan to indicate that it had something for Saskatchewan, something to sell. The Minister of Agriculture (Mr. Wise) was in Saskatchewan also, again to sell the Budget and to apologize for the great increases in the deficit; again, to tell the fairy tale about how much he has done for farmers.
The Conservative manifesto which came out of that Prince Albert visit by the caucus before the election stated very specifically that there were some things the Government intended to do. There were three points basically. It was to abolish capital gains, which it has done to some extent, but which it is suggesting it might renege on. In fact, the Nielsen report suggests maybe the Government has gone too far and it should start backing up. The second was that the Conservative Government would reduce the price of farm fuels by 20 cents per gallon by removing the federal sales tax and not collecting the current excise tax. The Government did start a rebate system of 3 cents per litre, but there is now approximately 9 cents per litre federal tax on gasoline, so it has touched approximately one-third of the taxes levied on farm fuels. Again, the Nielsen report suggests that it should back off on this.
We are getting very different signals from the Government, at the same time and even from the same people. It has been saying it is going to give the farmers a better deal by eliminating taxes. The Government promised that in 1984. The Government gave a 3-cent rebate, but it added four and a half cents in taxes over the same period of time so the farmer pays a cent and a half a litre less than he did before.
The Government also promised agri-bonds in the election. Those were shuffled under the rug. The Government promised that the Progressive Conservative Government would expand and revitalize the Prairie Farm Rehabilitation Act. Just the other day when the Nielsen report was tabled in the House one of the recommendations was the dismantling of the Prairie Farm Rehabilitation Act, passing it off as much as possible to the provincial Governments. The record shows that in respect of these three promises the Government made back in 1984 it
has only done something about one, and it is now attempting to renege.
We have been told very often that 20 per cent of farmers are in financial trouble. If you will pardon the use of the word, I think that is a conservative estimate. There have been many words from the Minister of Agriculture and other members of the Government about the survival of the family farm, about what would be good for the family farm, but it is obvious that the Government is not going to do anything, or has not thrown any support behind the family farm. What is in the Budget actually indicates that the Government has thrown in the towel as far as the family farm is concerned. It would much rather spend money on getting people out of agriculture than helping them stay in.
Another Conservative promise was tax reform. There is not a word in this Budget about tax reform, because that would mean less taxes paid by the people who can afford it and more taxes paid by those who cannot afford to pay. That progressive movement of taxation is what we all looked forward to when the Government said it was going to have a simple and fair tax system.
The Financial Post gives three examples. The first relates to an income of $40,000 comprised of a salary, dividends and interest. It shows an income tax increase of $812 for a $60,000 income. It shows an income tax decrease of $1,201 for a $150,000 income, with a decrease in income tax over the next three years of $5,470. This is an indication of what the Government thinks is a fair tax. There is an increase in taxes for the middle-class and the lower-income people and a decrease in taxes for the higher-income earners. Therefore, it may not be a good idea to pass a Borrowing Bill at the level of $22.6 billion.


Mr. Keith Penner (Cochrane-Superior):: Mr. Speaker, whenever a Government comes to the House of Commons to borrow a very large sum of money, I believe it is appropriate for Hon. Members to ask how this money is going to be spent and whether we are going to receive value for our money. It is on that basis that I would like to say a few words about Indian and native economic development.
If we examine the departmental Estimates for 1986-87 we will discover that economic development has been determined to be a priority of the Department of Indian Affairs; that is, strengthening Indian economic development programs aimed at improving self-reliance and reducing the need for maintenance-oriented programs. In other words, what the Government is saying to the Department is that it wants to get people off welfare and social assistance and into a work-oriented situation or environment. Everyone agrees with that. It is what the Government wants and it is what the political Parties, represented in the Standing Committee on Indian Affairs and Northern Development, want. It is what the Indian people themselves want. They have stated on more than one occasion that they want to break free from this dependency cycle which gives the Government of Canada, through the Department of
March 17, 1986

Indian Affairs and Northern Development, so much authority and control over every single aspect of their lives. It is what everyone wants, but we somehow cannot achieve it despite the fact that large amounts of money are being spent.
Last year, for example, in fiscal 1985-86, $56.5 million was set aside by the Parliament of Canada for Indian economic development. This year there is to be an increase to nearly $63 million. I believe the people of Canada would be interested in knowing that out of that designated $63 million, $50 million will be transferred in the form of grants and contributions for economic development, but there is another $13 million which will be held by the Department for its operating costs in economic development.
Economic development through the Department of Indian Affairs and Northern Development is really a story which fails to deliver much in the way of success. It has a discouraging and depressing record. We begin to wonder whether in fact the Department of Indian Affairs and Northern Development should be involved in economic development at all.
While not much of value can be found in the reports of the study team or task force on Indians and natives-the so-called Nielsen Task Force-they do make this passing observation. In talking about the Department of Indian Affairs and Northern Devrlopment, it is stated, and I quote:
In a department which assumes responsibility for womb-to-tomb care, the pressures to provide social assistance are more irresistable than the economic ones.
For a long while there has been in the minds of the Parliamentarians who sit on the standing committee a suspicion that the Department probably would prefer to have the people under its domination and control in a state of dependency rather than to have them set free through successful workable economic development programs. When the Special Committee on Indian Self-Government travelled across Canada some years ago, it received much testimony which indicated that Indian people want to get out of this dependency cycle, out of this welfare society, but at the same time that every turn they appear to be frustrated in all of their efforts toward economic development.
Perhaps Hon. Members would be interested in just one example which the special committee encountered in the province of Alberta. We learned from testimony that Indian Governments should be allowed to establish their own priorities and guidelines. One of the leaders gave us this example. An Indian band in northeastern Alberta took over the social development program, that is the welfare dollars. They received the dollars and they were going to administer the program. They were told to undertake the program according to the guidelines established by the Department of Indian Affairs and Northern Development in consultation with the provincial Government. The Indian people of that reserve, instead of wanting welfare, per se, wanted employment. When that particular band council undertook the program, it established its own guidelines based on its own priorities. It made people go to work, for instance. If an individual was entitled to $100 worth of welfare a month, the band asked that the
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individual be put to work. The council, in its wisdom, put those people to work on community improvement projects. The implications were far reaching. They extended even to the children themselves. When the children saw their parents going to work the attendance rate of those children in school increased dramatically. This went on for quite some time until someone in the hierarchy of the Department told the band that it could not make people work for welfare. What a contradiction in terms!
At the federal level we have job creation programs so that people will not have to ask for social assistance. We have had these programs for a long while and they continue to exist under different names. But when we come to deal with Indian people and transfer social development dollars under their care, we then disallow them from having the job creation programs they want. With respect to the particular Indian band in Alberta, it was told by the Department that it was violating Treasury Board guidelines and to cease and desist. It stopped the program. The contract for the transfer of social development dollars was ripped up, and once again the cheques just came automatically in the mail from Ottawa to the individuals in that particular band. That is an example of how economic development is constantly frustrated at the reserve level.
That is why a number of years ago, before the current administration took power, there was a lot of debate in this country about what we could do to break out of this poverty cycle in which Indian and native people found themselves. It was suggested that a significant amount of money expended over a relatively short period of time-in this case it was five years and the amount was $345 million-was to be put in a native economic development program. It took a long time for the previous administration to make up its mind. There was delay after delay after delay before it was finally agreed that the program would go forward. There were one or two carefully determined rules about the program. The first was that we should get it out of the Department of Indian Affairs and Northern Development. I think I have given some clues as to why we wanted to get it out of the Department entirely. The program went to the Ministry of State for Small Businesses. Then it was thought that it would be a good idea to get it out of Ottawa altogether, because there is sometimes a kind of mentality and approach in the nation's capital which does not fit the regions of the country. So the program was to be administered out of Winnipeg. It was to have a Board of Directors made up of Indian and native people. It was to have a degree of independence which had not been practised in economic development up to that time.
I wish to conclude by telling Hon. Members what happened. Last year Parliament, under the new administration, allocated $110 million to the program. The Minister of State for Small Businesses (Mr. Bissonnette) expended only $20 million of that allocation. Out of that $20 million $11 million was spent on operating costs, overhead and administration. Only $9

March 17, 1986
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million actually went to Indian and native projects in the country-only $9 million.
In the next fiscal year there is supposed to be some $57 million allocated. We do not know how much of that amount will be spent for administration and overhead. We do not know how much will actually go to Indian people and native development projects. We simply do not know. However, I wish to tell Hon. Members that in speaking to this borrowing authority measure the people of Canada should know that we are doing a terribly poor job in getting economic development for Indian and native people off the ground. They want it to work. We should want it to work because this welfare syndrome is destroying them heart, soul and mind. We need something better. We had better face up to that quickly and move ahead.


Mr. Cyril Keeper (Winnipeg North Centre):: Mr. Speaker, the Government has before us today a proposal to borrow some $22.6 billion. That is an enormous sum of money to be asking the House of Commons to approve for borrowing purposes. By implication the Government is asking for an approval of its budgetary and economic policies. It is as a result of its economic policies that it is forced to come before us today asking for authority to borrow some $22.6 billion.
I would like to ask Hon. Members to consider the Government's economic policy, particularly the policy as outlined in the Budget brought down just a few weeks ago. Consideration of the matter will give us an indication of whether or not the authority which it is seeking today should receive approval, or that this request should be turned back to the Government calling upon it to re-examine its economic and budgetary policies.
The last Budget raised the taxes of the average Canadian family by about $350 a year. This is on top of the previous increases in taxes which the Government imposed in its last two budgetary measures. This is also on top of $1,000 a year in additional taxes which families were hit with in 1985. The total comes to $1,350 a year of additional taxes, just since the Government came to office in 1984.
How do ordinary Canadians view this increase in taxes? The Government asks us to take the perspective that this is the price which has to be paid, that the Liberals created a large deficit and the Conservatives will pay it down. Thus ordinary Canadians will simply have to pay through the nose in order to get the deficit down. If ordinary Canadians are being asked to pay we have to ask who else is paying the burden with respect to the deficit. Who else has the Government chosen to pay for this burdensome deficit?
What we find is that taxes imposed on individual Canadians are increasing four times faster than those imposed on corporations. The last Budget actually imposed measures to lower the tax rate of corporations. As a result of the economic, taxation and borrowing policies of the Government taxes for individual Canadians are rising four times faster than those of corporations in this year alone. This means that individual Canadians will be asked to pay $1.1 billion more compared to the $380 million which the corporations are being asked to
pay. How can the Government present such a policy expecting approval when it is asking individuals to pay four times as much as that paid by corporations? How can the Government justify such a move?
An increase four times greater sounds pretty bad. However, if we look into the future we will find that by the year 1990 the Government will be taxing individuals ten times as much as it taxes corporations. This is to say that individuals will be paying an additional burden of some $2.9 billion. That is almost $3 billion, whereas corporations will be asked to pay an increase of just $295 million.
We must fundamentally question the economic policy the Government has put before the House. We have to question the Government's temerity in coming before us today asking for authority to borrow some $22.6 billion, particularly in light of the fact that it lowered the corporate tax rate in its last Budget. In one breath it has asked to borrow billions of dollars and lower the tax burden on corporations.


Some Hon. Members:: Shame!


Cyril Keeper: Yes, Mr. Speaker, it is a shame. It is simply unfair.
In the most recent Budget the Government continued the capital gains write-off measure whereby if the capital an individual owns increases in value up to $500,000 that individual does not have to pay any tax on it. This capital gains write-off has been continued in the latest Budget. How can the Government advocate a tax write-off for wealthy Canadians while at the same time it hits ordinary Canadians with a tax increase of $350 per year and is asking ordinary Canadians to support and approve its borrowing of some $22.6 billion? It does not make sense.
If the Government wishes to borrow money we must ask what it is borrowing it for. Is it borrowing this money in order to put ordinary Canadians to work? Is it borrowing this money so that the unemployed-now well over one million-can obtain useful employment, a decent income and make a contribution to society? The facts indicate that that is simply not the case.
The Government is actually borrowing this money in order to continue the types of tax write-offs which I have already mentioned. The Government lowers the corporate tax rate while at the same time it cuts back on funds which are allocated to employment programs. In the last Budget the Government cut a couple of hundred million dollars in terms of employment programs over the next two-year period. The significant fact is that in this time of high unemployment, the Government is cutting back on employment programs so it cannot be borrowing in order to support those programs.
Is the Government borrowing money to support the youth of Canada? Clearly not, Mr. Speaker. It has taken the heartless action of cutting out the Katimavik program, a program which offered a real opportunity for young people to serve in com-
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munities across Canada, to gain some work experience and to see the country. It was a way of extending opportunities to young people. Yet the Government has chosen to cut that program, and it still remains deaf to the needs of young people in spite of the fact that one of the members of the other place has chosen to undertake a hunger strike in order to bring the message home to the Government that young Canadians have needs and that any program that exists to meet those needs should be supported rather than undercut.
Could the borrowing be justified because it is helping out those who are unemployed or retiring? Clearly not. The Government has recently announced that those who retire can no longer receive the unemployment insurance benefits to which they were once entitled. Having paid into the unemployment insurance fund for 20 or 30 years, one should expect to receive unemployment insurance benefits for a period of time upon retirement. I see, Mr. Speaker, that you are signalling that I have one minute left. I will wind up.
I really question why the Government is coming before us to ask to borrow $22.6 billion, not because I am against borrowing in principle but because of the reasons for which the Government is borrowing the money and because of the economic policies it is following, economic policies which favour corporations and place a heavy tax burden on ordinary Canadians while at the same time services to ordinary Canadians are being cut back. That is simply unacceptable to members of this Party.


Mr. George Baker (Gander-Twillingate):: Mr. Speaker, the Government of Canada is keeping Canadians in the dark about its legislative program for this year, next year and the year after. It is also keeping Canadians in the dark as to the exact figures that relate to borrowing and the national debt.
When one looks at the figures from the speech made by the Minister of Finance (Mr. Wilson) last month, and when one reads the booklets that came with it, one begins to wonder just where the Minister of Finance is getting his figures and how he draws his conclusions. It is an inescapable fact that the Government is simply floundering. It is wasting money here, there and everywhere. There was the bank fiasco and there have been examples of exhorbitant spending in Ministers' offices. There have been numerous examples of waste in spending the taxpayers money. Yet the same Government says it has an enormous problem on its hands, but does not revise its spending patterns at all.
When looking at the actual figures it is interesting to note that as of today the Government, since it came to power 18 months ago, has been responsible for accumulating some 24 per cent of the total national debt that is on our shoulders today. If that were not bad enough, the projected deficit for this coming year and the year after indicates that they will be not only the highest deficits but the second highest deficits, and the third highest deficits. According to the projections of the Minister of finance, by the year 1990, if the Government remains in power, which it will not-it would have been responsible-
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Mr. Kilgour:: Wait and see.


George Baker: Now Government Members do not like what I am saying because I am using the words of the Minister of finance. The Government would have accumulated 50 per cent of the total national debt of Canada. All the deficits since Confederation would be accumulated throughout the term of the Government which is presently in power.
We know where the waste is. We all know about the $2 billion here and the $1 billion there. We all know about the attempted bank bail-out and its outcome. The Minister of State for Finance (Mrs. McDougall) was totally responsible, and on her shoulders lies the blame for the $1 billion sum in this year's Budget for pay-outs to uninsured depositors. We know all about the Government.
We begin to wonder about the Government's projections. When we look at the actual figures released just last week we find that the Minister of Finance is really not on target at all. The deficit is the same as it was last year for the first nine months of this financial year, give or take a half a billion dollars, and that sum means nothing at all to the Government. So the Government has decided to make Canadians pay for it. It will punish Canadians because of its own mistakes.
If that were not bad enough, there was a ministerial task force composed of the Deputy Prime Minister (Mr. Nielsen), the Minister of Finance, the former Minister of Finance and the President of the Treasury Board (Mr. de Cotret). These were the four Ministers who, when the Budget was presented last May, presented their Cabinet decisions on the first five reports of the study groups. They told us what the Government was doing with the recommendations of the study groups.
What did we see happen the other day? We saw only 21 reports of the study groups presented. That makes 26 books altogether. As you know, Mr. Speaker, there are 26 books in the New Testament. However, today I am referring to the 26 unholy books that were presented by the Deputy Prime Minister.
We do not know what the ministerial task force has done because it will not tell us. I can assure you of one thing, Mr. Speaker. The task force has already sent all of its recommendations from the study groups to the Planning and Priorities Committee of Cabinet. In other words, the Cabinet approved the last set of recommendations this past Thursday. The Government has decided what to accept from the 21 most recent books presented by the study groups. Now the Government of Canada wants us to approve its borrowing pattern, and for what, we do not know.
I have it on good authority that some of the recommendations of the study groups have been followed. Let me outline very briefly what the ministerial task force has recommended as it relates to Newfoundland. It recommended, for example, that the Government cut the entire coastal boat service along the Labrador coast. It recommends the ending of all subsidies to Canadian National in Newfoundland. It decided-[DOT]


Donald Alex Blenkarn: Good.

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George Baker: I hear an Hon. Member from the Conservative benches saying that that is good. Then it recommended to seek judicial clarification on federal constitutional obligations concerning all subsidies to Newfoundland and the provision of the Newfoundland and Labrador coastal services. They have actually said they will obtain a judicial decision on the terms of union between Newfoundland and Canada after making the reductions they are to make. It is a slap in the face to all Newfoundlanders.
Let us look at the recommendations which the federal Cabinet has accepted, for example, in environment. They recommend the closure of the weather office in Gander through the transfer of the weather centre to St. John's. Air Canada made an application to move its international flights to St. John's. If the Government approves, it will mean that St. John's airport would require about $4 million or $5 million of expenditure just to meet the standard federal requirements of space for security reasons. The Department of Immigration and the Customs Department have told the Minister of Transport (Mr. Mazankowski) that he cannot approve the application unless the Government spends $4 million or $5 million.
The Minister of Justice (Mr. Crosbie) threatened Air Canada by saying: "You go to St. John's or else". Now the task force is recommending moving the weather office from Gander to St. John's, which will result in an additional cost to the federal Treasury. Is it any wonder that one of the persons on the ministerial task force was the Hon. Member for St. John's West in whose riding St. John's airport is located? We see throughout the documents the vested political interest and the short-term political gain. The Government is trying to obtain some political influence for the former Minister of Finance, the Hon. Member for St. John's West, and is trying to prop up the Hon. Member for St. John's East (Mr. McGrath). The Government of Canada will not get away with it. It will be put on the spot on every move it makes in an attempt to rob from Newfoundland for the benefit of its Members' ridings.


The Acting Speaker (Mr. Charest):: The Hon. Member for Hamilton Mountain (Mr. Deans) on debate.


An Hon. Member:: Him too?


Ian Deans: Mr. Speaker, I hear a voice from the wilderness on the other side. Let me say to him: "Yes, me too".
I have listened to the debate the last few times this matter has been before the House. As I heard the arguments being made, I thought to myself how it reminded me of the arguments made during the period from 1980 to 1984. At that time Conservative Members sitting on this side of the House, when the previous Liberal administration was in power, rose one after another, ad nauseam, arguing that there was no necessity for that amount of borrowing, that the borrowing was founded on wrong information and misguided policy, and that the borrowing was inappropriate. In fact, any number of arguments were put forward, each one of which has been advanced again during the course of this debate. As I thought about that, I could not help but feel that the Conservative Party in its new capacity has not changed very much. The only thing its Members have not yet done, though I warn you, Mr. Speaker, that it is not outside the realm of possibility, is muster their numbers to charge the Speaker's chair during this Parliament. That is about all that has not been pursued.


John Barry Turner: Not yet.


Ian Deans: As the Hon. Member for Ottawa-Carleton (Mr. Turner) just said, it has not happened yet but it may. 1 would not be at all surprised if he led the charge, after having listened to him, without fully understanding the undermining effects such a charge would have on the authority of the Chair. That is what the Conservatives did in the early 1980s when they attempted to intimidate the Speaker of the day with their obnoxious, boorish behaviour.
However, I see in the Government much of what I saw in the Conservative Party when it was in Opposition. Its Members argued on both sides of every issue, just as they are doing today. In fact, I remember rising in the House at one point and making some comments about that very fact. It made no difference what was before Parliament or what issue was being discussed across the land, people could find a Conservative Member to speak for them no matter what side of the issue they were on. At one point-and in fact I am not even sure now, but I thought it was by design-they had decided that since they did not have a clear policy on anything and since they did not really stand for very much, they would find out on purpose what was the public view on each issue. There is always more than one view held by the public at large, so they would make sure that every aspect of the issue was covered by one or another of their speakers. Then if a Canadian asked for the Tory view on almost anything-


Mr. Riis:: Give me some examples.


Ian Deans: I hear my colleague; I will in a moment. However, if a Canadian wanted to find out where the Conservatives stood on the testing of the Cruise missile there would be a Conservative who had spoken in the House of Commons against it and one who had spoken in favour of it. Then they could check to find out what side the person was on and ship out the appropriate piece of propaganda. If one happened to be in favour of the universality, for example, there would be a Tory speaking for him or her. If one were opposed to universality, one could find a Conservative who had spoken on that side of the issue, and therefore be provided with the appropriate piece of propaganda. This seems to continue all the way into Government.
I remember when the Minister of Finance (Mr. Wilson) stood in the House of Commons and argued vehemently against the necessity for borrowing. In fact, the Conservatives put up speaker after speaker-perhaps as many as 90, sometimes-to castigate the then Government for its audacity in introducing time allocation to terminate the debate and to
March 17, 1986

argue against the necessity for borrowing. What did they do after assuming office? They brought in borrowing Bills at least as large if not larger than those brought in by the previous administration.
I know, Mr. Speaker, that you will be fascinated by the following. I remember a debate in the early part of the 1980s when the then finance critic, the present Minister of Finance, said that interest rates were okay at the high level. He went to Montreal and made a speech to its board of trade. He said there was nothing the Government could do about high interest rates, that they were just a product of the economy and that we had to live with them. At the very same time, Conservative Members sitting beside him were rising in the House of Commons and demanding of the Government of the day that it bring down interest rates. If some poor soul from the outback in Canada wanted to get the Tory position, he or she could either have the "Michael Wilson" position on interest rates, being high out of necessity, or some other position put by another Conservative Member, requiring that interest rates be brought down. This tells us something about the Government.
No sooner did the Conservatives move into Government and we were confronted by the spectacle of the argument over universality. The Minister of Veterans Affairs (Mr. Hees), my good friend and colleague, will remember this well. On the one hand, we had the Minister of Finance arguing that we could not afford universality. On the other hand, we had another fellow who was saying that universality was a sacred trust. Who was that?


The Acting Speaker (Mr. Charest):: Order, please. I am very sorry to interrupt the Hon. Member for Hamilton Mountain.


Ian Deans: I will be back.


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


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.


Mr. Fernand Robichaud (Westmorland-Kent):: Mr. Speaker, several sectors have been hit hard by the Wilson Budget, particularly the tourist industry. At least ten-odd measures
will affect tourism: the excise tax increase, 4 per cent on alcohol and 6 per cent on tobacco; the 1 per cent sales tax increase which again applies to alcohol, tobacco and, in addition, gasoline; the air transportation tax from 9 to 10 per cent; the $100 million cut-back in VIA Rail's budget; the new 3 per cent income surtax, which erodes the purchasing power of Canadian tourists; $100 million less for the Canadian Jobs Strategy program and Challenge 86 and their many tourism-oriented jobs.
Those are so many measures which will drive into the ground an industry which happens to be vital to Canada's economy and whose progress entails untold efforts to overcome all obstacles-


Mr. Speaker:: Order. The 60 seconds have expired.



AGRICULTURE


Stanley J. Hovdebo: Mr. Speaker, producers have been waiting for over a year for a strong commitment to maintaining a domestic sugar industry in Canada.
We recognize and appreciate the efforts made by the Minister of State (Canadian Wheat Board) (Mr. Mayer) which finally resulted in a commitment, however vague, and a preliminary announcement. But it is only a preliminary announcement.
What about the $30 million in stabilization still owed to Alberta producers? What about the variable levies and temporary floor prices? What about the corn syrup industry, which was barely mentioned? What about the details of the stabilization scheme that has still not been negotiated? Surely this vague pronouncement is not the final result of 18 months' work.
We look forward to a genuine long-term commitment to the industry, and we hope that today's optimism will not have been misplaced.



THE ADMINISTRATION


Mr. Andre Plourde (Kamouraska-Riviere-du-Loup):: Mr. Speaker, much has been said about the need to reduce the deficit. Here are statements made by a senior member of the Liberal Government during the election campaign.
In July 1984, he stated: "Government expenditures must come down. There is a lot of room for cut-backs in expenses and duplication. I think those reduced expenditures would enable us to save billions of dollars."

March 17, 1986
He went on to say: "Some programs are sheer duplication, others are not profitable, and certain administrative activities are a complete waste. Some programs are no longer of any use at all and I will axe them."
Here is what he said in May 1984: "We must find ways to restore a more efficient public administration."
Mr. Speaker, I just quoted the Leader of the Liberal Party (Mr. Turner). Canadians heard him loud and clear, so they elected the Progressive Conservative Party in September 1984, and they were right. We should not talk about it anymore, that is exactly what the Government has done.



THE ECONOMY


Mr. Bill Gottselig (Moose Jaw):: Mr. Speaker, we are putting our financial house in order. Since we became the Government in September, 1984, we have seen a steady change toward fiscal responsibility. Not only are we spending less but we are spending smarter. The recent Budget is a clear indication of this.
My constituents, who are owners of small businesses and are agricultural producers, understand the necessity of controlling the deficit. They welcome the provisions for increased employment opportunities as well as the programs for hard-pressed agricultural producers.
Confidence is growing daily as the provisions of the Budget take effect. Look at the falling rates of interest and unemployment, Mr. Speaker.
We said we were going to set Canada on a new course. We have kept that commitment. We said we were going to reduce runaway spending. We have kept the commitment. Indications are that we will have eliminated the deficit by 1990.
My constituents join with me in congratulating the Minister of Finance (Mr. Wilson).

[ Translation]



THE PRIME MINISTER


Mr. Carlo Rossi (Bourassa):: Mr. Speaker, the comments made on the weekend by the Prime Minister (Mr. Mulroney) about the circumstances of the resignation of the former Member for Saint-Maurice (Mr. Chretien) really cannot be taken seriously.
No one in the political history of our country can equal the Prime Minister's expertise in back-stabbing. Just ask Joe. He can show you the scars. Compared to the Prime Minister, Judas who as innoncent as a newborn babe. Poor Brian, he is trying every possible trick to win back the ground he lost in Quebec, and he is prepared to stab anyone who gets in his way. Mr. Prime Minister Brian, this is pitiful but not very smart.



AIR TRANSPORT


Ian Deans: Mr. Speaker, as you know, Hamilton-Wentworth has a brand new air terminal. However, a terminal without a proper airline makes very little sense. Last Thursday I arrived at the air terminal in an effort to come to Ottawa at 6.30 in the morning hoping to catch the City Express, a non-stop flight. I discovered when 1 got there that the City Express had not sent an aircraft to Hamilton, that in fact there was no aircraft there, nor was there likely going to be any.
We ended up having to be trucked, as usual, from Hamilton to Toronto by taxi in order to try to make connections.
City Express not only does not provide an adequate service, it does not even have the courtesy to inform its passengers that the airline is not going to be operating on certain days of the week. I suggest that the Government take a serious look at the mandate given to that airline to see if it cannot be changed.

[ Translation]



THE ECONOMY


Mr. Clement M. Cote (Lac-Saint-Jean):: Mr. Speaker, in the fourth quarter of 1985, the optimism of heads of businesses was at record levels, according to a survey by the Conference Board of business attitudes and investment plans.
The percentage of entrepreneurs who feel that the current period is favourable for investment has risen abruptly from the previous high rate of 42.8 per cent in the third quarter to 49.7 per cent in the fourth.
This is the highest rate of optimistic responses since the second quarter of 1979. According to the Conference Board, business heads are also more optimistic than they were before about the prospects for our economy.
Mr. Speaker, what a change since the last quarter of the Liberal administration in 1984, when in fact 45.9 per cent of respondents to the same question did not think it was the right time to invest in Canada!
March 17, 1986



CURRENCY


Mr. Joe Reid (St. Catharines):: Mr. Speaker, there are probably many reasons to introduce a new series of Canadian bank notes at this time. However, none is more important than the opportunity this gives the Bank of Canada to make the different denominations of those notes distinguishable by the blind and visually impaired. The visually impaired welcome the larger, more distinct numerals, as well as the distinct dominating colour of each denomination.
For years the sightless have wanted these notes made distinguishable by the use of Braille, an economic system which they will all use. They do not need to speak to the note, nor do they have to be burdened with the use of a separate electronic scanner. It is to be hoped that the machine-age for the handling of our money does not, in itself, become the major deciding factor. In the end result, the Bank of Canada is to be commended on its consideration for this disadvantaged sector in our Canadian populace.



THE ECONOMY


Mrs. Pauline Browes (Scarborough Centre):: Mr. Speaker, last Thursday's 1 per cent drop in the bank rate is further evidence of the strength of the country's economy and the success of the Government's policies. Together with lowering interest rates, a quick survey of today's economic indicators will reveal further good news: 4 per cent inflation, 9.8 per cent unemployment, and 5 per cent GNP growth.
Numbers alone cannot truly reflect the true spirit of confidence and optimism that has swept the country from coast to coast. Last weekend I had the opportunity to meet many Canadians from every region of the country. In one way or another each one of them expressed to me the same message- Canada is working again. That, Mr. Speaker, is an economic indicator which cannot be assigned a number, but nevertheless speaks volumes of the confidence Canadians have in their economy and their Government.



THE DISABLED AND THE HANDICAPPED


Mr. Roland de Corneille (Eglinton-Lawrence):: Mr. Speaker, I am deeply concerned about employment opportunities for the disabled in the federal Public Service. It is hard to find a permanent job these days, and it is even more difficult for the disabled. In 1984-85 the vast majority of disabled persons hired by the Public Service Commission were hired in limited
or term positions. With Tory Government cut-backs, term positions are among the first to go, thus leaving many disabled unemployed. I personally know of some of these disabled people being laid off at the end of this very month.
It is obvious that all the Tory Government does about employment equity is talk about it. Once again the Government continues to place a higher priority on the deficit and statistics and numbers, as did the last speaker, than on people.



THE PRESS


Mr. Arnold Malone (Crowfoot):: Mr. Speaker, no sector of the media is as cherished as our weekly newspapers. They have served rural Canada for a century. Filled with tidbits of local interest, most weekly newspapers stay in the house until they are completely read from front to back. Unfortunately, the small entrepreneurs who provide the nation's weekly newspapers are in a mean and unfair fight with Canada Post.
Community newspapers are perpetually losing subscriptions because the Post Office cannot deliver the papers in a respectable time. Yet in spite of that, and irrespective of the fact it causes financial hardship for publishers, Canada Post has the gall to assume the privilege to undercut these papers in marketing ad mail. How legitimately angry the publishers must be to realize that their tax dollars are used to subsidize Canada Post in an unfair competition for ad mail services.



FINANCE


John Edmund Parry: Mr. Speaker, workers at Stelco's Griffth Mine in the Ear Falls-Red Lake region of northwest Ontario have suffered a double blow. First they were told the mine would close at the end of this month. Secondly, they cannot get an answer from the Minister of Finance (Mr. Wilson). The Minister twice in this House committed the Government to give tax relief to laid-off workers in isolated communities. He said this on November 8, 1984, in the economic statement, and in the May 23, 1985, Budget. The Minister of State for Mines (Mr. Layton) specifically promised equal treatment for Griffith Mine workers on November 16, 1984.
At a meeting in June, 1985, nine months ago, Stelco executives met with Ministry of Finance officials to present the need for a tax remission. Yet as of today no remission order has been issued. The mine closes in two weeks. When will the Minister make good his word and spare the workers of the Griffith Mine this unfair and frustrating delay?

March 17, 1986



S O. 21 TRADE CANADA-UNITED STATES NEGOTIATIONS-BENEFITS OF FREE TRADE

Mr. Gordon Taylor (Bow River):: Mr. Speaker, some Liberals, the NDP, and some labour leaders are trying to frighten Canadians by saying if we have free trade with the U.S. the Americans will dominate us, or we will lose our sovereignty, or our social programs will be in jeopardy. Such statements are sheer nonsense.
The Canadian red meat industry has had, and still has, virtually free trade with the U.S. in finished products. We have not lost one social program. We have not lost one iota of sovereignty. We have not dominated. In fact I know of no adverse results, only benefits for Canadians and Americans. The Western Stockgrowers Association supports free trade with the U.S. as well as the rest of the world.
As the Irishman said: "When we get free trade I will be thankful for the rest of my life, if I live that long."



THE DISABLED AND THE HANDICAPPED


Mr. Neil Young (Beaches):: Mr. Speaker, there are several hundred disabled persons employed by the federal Government who are currently being cut through the public service freeze and downsizing actions of the Government. Most of these people are in term positions, some after going through the Government's Access Program for Disabled Persons. Several have already received notice of the Government's intent not to renew their terms, some as early as March 27 of this year.
The Government committed itself not to hurt disabled people and make the Public Service of Canada more representative of target groups. You will be interested to know that of the six employees in the Minister of State's Department's program for disabled employment opportunities, two are disabled and both are about to be terminated at the end of this month. If the Government has a real commitment toward the disabled, those are the last people who should be attacked in its fiscal restraint program.



PROVISION OF PROGRAMS

Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, the Secretary of State (Mr. Bouchard) is wrong when he claims that he needs weeks and months before he can produce a policy on youth employment. The Minister had time during the whole of 1985, during Youth Year, to prepare a policy for youth. A whole year. Yesterday on Cross Country Check-Up he had the nerve to say that he needs more time to come forward with something. In addition, while he had been warned that the
Senate report was going to recommend projects like Katimavik in the future, he still had the nerve to kill Katimavik.
The Secretary of State said there is no money to provide youth programs. The money was found for the Nielsen Report which cost millions of dollars, it was found to bail out the banks which cost hundreds of millions of dollars. We are asking the Secretary of State-


Mr. Speaker:: Please, 60 seconds.



PRESENCE IN GALLERY OF NEW ZEALAND MINISTER OF AGRICULTURE AND FISHERIES

Mr. Speaker:: May I draw to the attention of Members the presence in our gallery of the Hon. Colin James Mole, Minister of Agriculture and Fisheries of New Zealand.


Some Hon. Members:: Hear, hear!



ORAL QUESTION PERIOD


Hon. Donald J. Johnston (Saint-Henri-Westmount):: Mr. Speaker, I note the Secretary of State for External Affairs is not in the House. I hope he would be, given the summit beginning today. In the absence of the Prime Minister I will go to the Deputy Prime Minister. Is the Deputy Prime Minister able to tell us what the Government's response is to President Reagan's national television message to Americans last night? What is our response to his plea for increased aids to the Contras in Nicaragua?


Hon. Erik Nielsen (Deputy Prime Minister and Minister of National Defence):: The immediate response. Sir, is that the activities of the U.S. Congress on this question are a purely domestic affair. It would be inappropriate for there to be a response. Having said that, let me repeat what the Secretary of State for External Affairs said on the thirteenth of the month as reported at page 11507 of Hansard:
-Canada can advance that progress-
That is the process of seeking a peaceful solution in Nicaragua-
-best by pursuing and strengthening the Contadora process, as we have been doing, and by resisting the temptation to reduce our influence in the United States and elsewhere by offering gratuitous advice which we can neither defend nor enforce.
March 17, 1986


PRIME MINISTER'S DISCUSSIONS WITH UNITED STATES PRESIDENT
Donald James Johnston: My
next question is also directed to the Deputy Prime Minister. If the policy is to strengthen the Contadora process, then the response surely has to be to President Reagan in the strongest terms that Canada disagrees with this initiative. That view certainly should be expressed-I would hope the Prime Minister would agree-now that the Prime Minister has the opportunity of sitting down with the President in Washington this evening. Can he give us some assurance that the Prime Minister will make sure that item is on the agenda and that Canada's views are made known.


Erik Nielsen: Mr. Speaker, I do not think there is anyone in the House who is unaware of the fact that the discussions between the President and the Prime Minister are going to be very broad ranging indeed. Again, let me point out to him the response of the Secretary of State for External Affairs of last March 13, to the Member for New Westminster-Coquitlam:
We believe-
That is this Government,
-that actions speak louder than words in Central America as elsewhere. Our Government has tripled its development assistance in Central America because we believe the problem there is an economic problem and not a military problem to be solved by military means.


UNITED STATES DUTY ON CANADIAN FISH EXPORTS
Donald James Johnston: Surely a summit is a time for straight talk, and we hope to see some from the Prime Minister to the President, not only on the Nicaragua issue, but on other major issues such as the countervail on Atlantic fish products, where there has been a modest reduction of 1 per cent. If the Government does not agree with that decision, namely that 1 per cent is insufficient, surely the Prime Minister will take this opportunity of advising the President that that countervail has to be removed.


Erik Nielsen: There is no question that will be a subject of discussion, Mr. Speaker.


PRIME MINISTER'S VISIT TO WASHINGTON-ACID RAIN DISCUSSIONS
Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, in the absence of the Prime Minister and the Secretary of State for External Affairs my question is also for the Deputy Prime Minister and it has to do with the summit meeting. What we want to know from the Deputy Prime Minister is whether the Prime Minister will be asking the President merely to endorse the acid rain envoys' recommendation for five more years of research, or whether he will instead formally request that an emission control program be instituted in the U.S. rather than more research.
Oral Questions


Erik Nielsen: Mr. Speaker, the hon. gentleman knows that that is high on the agenda for discussion in the United States. He will recall, as well, the response which was given by the Minister of the Environment, in answer to one of his previous questions, that more has been accomplished by this Government in the area of acid rain in 18 months than by the Hon. Member's Government in 18 years.


Mr. Caccia:: Mr. Speaker, 1 was expecting a more serious reply on this kind of subject from the Deputy Prime Minister than the one he just gave.


CANADIAN POSITION
Charles L. Caccia: We want to know from the Deputy Prime Minister whether the Prime Minister will explain to President Reagan that more research over the next five years is unacceptable to Canada, especially so because the proposal of the acid rain envoys is simply one which leaves the initiatives to the industries which are the source of acid rain pollution. Will this be what the Prime Minister will put to the President?


Erik Nielsen: Twist as he might, the Hon. Member must recognize the fact that there has been no more eloquent a supporter of the elimination of the acid rain problem on this continent and in this country than the Prime Minister. The Hon. Member knows full well that those views, which have been expressed so often, and publicly, will be expressed by the Prime Minister in his meetings with the President.


NICARAGUA-VIEWS OF CENTRAL AMERICAN COUNTRIES
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, my question is directed to the Deputy Prime Minister and it concerns President Reagan's proposed escalation of military involvement in Nicaragua. I would like to say that, unlike the Deputy Prime Minister, most Canadians do not think such action is purely a domestic matter, just as we did not think action of a similar kind in Afghanistan and Vietnam were domestic matters.
Considering such countries as Costa Rica, Colombia, Peru and Mexico have made it clear that outside intervention of the kind now being advocated by the President of the United States is entirely wrong, will the Government of Canada, specifically through the Prime Minister in the meetings he is about to have on the eve of an important vote in Congress, also indicate clearly that this proposed action by the President of the United States is wrong?


Erik Nielsen: Mr. Speaker, the Hon. Leader of the New Democratic Party is attempting to misconstrue what I said. If I did not say it clearly, let me do so now. We do not believe, as

March 17, 1986
Oral Questions
a Government, that the affairs, as they are developing in South America, are domestic in that international sense. What I did say referred to the last part of the Hon. Member's question when he was speaking about a vote of the Congress in the United States. That is a domestic affair. We are just as vitally concerned about political and military unrest in any South American country, indeed, around the world, as he is.


John Edward Broadbent: Mr. Speaker, what really is domestic is what goes on in Nicaragua, and the President of the United States should understand that it is a domestic matter and that he should keep his nose out.


FUNDING OF MILITARY ACTIVITY AGAINST NICARAGUA
John Edward Broadbent: Following what the Deputy Prime Minister has now said, which is to clarify the position of the Government of Canada, namely, that we presumably would oppose any escalation of military activity in that region or anywhere else, and since the Deputy Prime Minister has said that, and since an important-


Mr. Speaker:: Order, please. This is becoming a very long preamble. Is there a question?


John Edward Broadbent: Given the importance of this issue to world peace, would the Government of Canada now make its views publicly known that it opposes the funding of military activity directed against the existing Government of Nicaragua?


Erik Nielsen: Mr. Speaker, the position of the Government has been made abundantly clear on more than one occasion. However, just to refresh the memory of the hon. gentleman, let me quote from Hansard of March 13, 1986. In reply to the Hon. Member's own critic, the Secretary of State for External Affairs had this to say, and I quote from page 11515:
We have contributed constructively to the Contadora process. We have discussed the possibility of contributing constructively to the resolution of border disputes. We intend to take an active role in working to bring peace and stability and-"


Mr. Speaker:: Order, please. The answer is too long.


CANADIAN POSITION
John Edward Broadbent: Mr. Speaker, since the Government will not criticize the proposed action, will the Deputy Prime Minister confirm whether or not it is the Government's view that the proposed action by the President of the United States constitutes a violation of international law?	,


Erik Nielsen: Mr. Speaker, I do not purport to provide legal advice with respect to international law to the hon. gentleman on the floor of the House of Commons.


CONSUMER AND CORPORATE AFFAIRS
Herbert Eser (Herb) Gray: Mr. Speaker, my question is for the Minister of Consumer and Corporate Affairs who, on Friday, told a coalition of groups representing consumers, senior citizens, women and labour that, as a concession to the United States, his Government will repeal our present law on compulsory licensing of prescription drugs, a law which saves consumers some $200 million a year. Will the Government be repealing this law? If so, how will it protect Canadians against higher drug prices if this law is changed?


Hon. Michel Cote (Minister of Consumer and Corporate Affairs and Canada Post):: Mr. Speaker, I would like to answer quite simply that we are concluding our consultation process. As soon as the Government has considered the various views that were expressed, we will submit a decision to Cabinet for consideration, and as soon as it is ratified, we will make an announcement in the House.


GOVERNMENT POLICY
Herbert Eser (Herb) Gray: Mr. Speaker, will the Minister not say now whether the Government will change the law? If so, will he limit any changes to those recommended in the Eastman Report, since those recommendations, according to Mr. Eastman, will protect both consumers, something which is important, and the industry?


Michel Côté: Mr. Speaker, I have said many times that whatever the policy will be it will not be carried out on the backs of the consumers but we will ensure that it creates jobs and brings investment to Canada.


PRICE OFCRUDE OIL
Nelson Andrew Riis: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources who will know that just a few hours ago the Saudi oil Minister said that oil prices could conceivably move to $8 a barrel in the months ahead. Recognizing the crisis situation which is now developing in the West, particularly in the Province of Alberta where there have been hundreds of lay-offs and where there is a potential for thousands, will the Minister explain to us what she plans to do? What policy does the Government have to come to the rescue of this ailing industry and the thousands of people who face impending lay-offs?


Mr. McDermid:: What a bunch of hypocrites!
March 17, 1986


Hon. Pat Carney (Minister of Energy, Mines and Resources):: Mr. Speaker, the Hon. Member is aware of the fact that we are experiencing disruption caused by a global price war which is being carried out for political reasons by Saudi Aradia and other countries. It is affecting the world price of oil. With respect to what I am doing about it, as the Hon. Member has asked, I am in constant touch with the industry and with the Ministers and the Premiers of the producing provinces to ensure that we are kept informed of what is happening.


MINISTER'S POSITION
Nelson Andrew Riis: Mr. Speaker, I think we are all well informed on what is happening. My question to the Minister who is responsible for this industry is simply this. Right now the Government is asking hundreds and perhaps thousands of Albertans to bleed, while it sits back in inaction. Rather than sitting back and letting the free market forces destroy the Albertan economy, thus putting thousands of workers on the unemployment rolls, what does the Minister of Energy plan to do?


John Horton McDermid: NDP flip-flop!


Pat Carney: Mr. Speaker, the free market forces to which the Hon. Member refers were responsible for record drilling being undertaken in western Canada last year after we brought in the Western Accord. As I have told-


Nelson Andrew Riis: Let's talk about the future.


John Edward Broadbent: That was when prices were high. What about now?


Pat Carney: I am really amused by the spectacle of the NDP supporting the producers.


John Edward Broadbent: It's your own ignorance, lady!


Mr. Speaker:: Order, please. The Hon. Member for Eglin-ton-Lawrence (Mr. de Corneille).


EDUCATION
Roland de Corneille: Mr. Speaker, my question is for the Secretary of State. The Nielsen Report flatly stated that there is no evidence that post-secondary education is underfunded. As the Government's expert in these matters, and in justification of his recent cut-back to the formula for federal funding of Canada's universities and colleges, does the Secretary of State agree with the assessment that post-secondary education is not underfunded?
Oral Questions


Erik Nielsen: Mr. Speaker, as you well know, these study team reports have all been referred to the respective standing committees. That is where the voluminous options of the study team reports should be examined. That is where the kind of question put by the Hon. Member should be asked of whatever witnesses the committee deems to call before it, in whatever mode it wishes to examine the reports. That is the opportunity in which he is invited to participate.


MINISTER'S POSITION
Roland de Corneille: Mr. Speaker, I thank the Hon. Member for his reply, but that does not cut it off at the pass. I am asking the Secretary of State a simple question. Does he agree that the post-secondary educational system is not underfunded?


Hon. Benoit Bouchard (Secretary of State of Canada):: Mr. Speaker, the Acting Prime Minister has said several times, as he did just now, that the reports will be referred to the committees concerned. Furthermore, the task force's recommendations contain a number of items that we will take time to consider, if you don't mind, and subsequently, we will be able to inform the House how they will be implemented, which will basically depend on the results of the studies that will be made.


ANNOUNCEMENT OF PROGRAM FOR YOUNG PEOPLE-GOVERNMENT POSITION
Howard Douglas McCurdy: Mr. Speaker, my question is directed to the Secretary of State. Does the Government intend to announce a program for youth before Easter, as promised by the Prime Minister a few days ago, yes or no?


Benoît Bouchard: Mr. Speaker, when the Prime Minister said that we would be announcing a new program for youth, which, incidentally, is not necessarily a job creation program, since the two are not necessarily connected, he never said that he would announce it before Easter. The time frame for announcing Government programs is determined not by chance or by pressures from outside but by the Government itself, which will decide when these new programs are to be announced.

March 17, 1986
Oral Questions


TIMING OF GOVERNMENT ANNOUNCEMENT
Howard Douglas McCurdy: Mr. Speaker, is the Secretary of State not aware that the Prime Minister said that there would be programs introduced for youth before the beginning of March and that the Minister of State for Youth said that, after studying the Senate committee report on youth and the New Democratic Party report on youth, there would be programs introduced by the Government in spite of his contradiction of that fact some days ago? Are we dealing with the promise of programs or mere propaganda?


Mr. Speaker:: Order, please. That was three questions. [Translation]


Benoît Bouchard: Mr. Speaker, I will repeat what I just said, since the question is the same. We said that we were going to announce a new program for youth, but again, we will do so when we feel the time has come to announce the program.


KATIMAVIK PROGRAM-GOVERNMENT POSITION
Mr. Jacques Guilbault (Saint-Jacques):: Mr. Speaker, my question is also directed to the Secretary of State. 1 may remind him that the Special Senate Committee was unanimous in its recommendation for setting up "Youth", a national community service volunteer program, for all young Canadians between the ages of 17 and 24, a program very similar to Katimavik. 1 would like to ask the Minister, since this was a unanimous report, if he is now prepared to reconsider his decision,-a controversial one, I may add,-to terminate the very popular Katimavik program.


Benoît Bouchard: Mr. Speaker, I have said time and time again that reversing this decision is out of the question. However, 1 am glad you referred to the Senate Committee. The Committee's first recommendation is to create jobs and provide appropriate training, something the Minister of Employment and Immigration has been doing so well, and that is what you should keep in mind, and no matter what you say, the Government's priority is to create jobs, and this kind of question is not going to make us change our minds.


SENATE RECOMMENDATION CONCERNING RESTRICTIVE MEASURES-GOVERNMENT POSITION
Jacques Guilbault: Mr. Speaker, the Senate Committee's first recommendation is as follows: that before implementing restrictive measures, the Government should examine their immediate and indirect impact-


Mr. Speaker:: Order. A question only!


Jacques Guilbault: -is that what led the Government to make those drastic cuts in the last Budget? Is that following the recommendations of the Senate Committee?


Benoît Bouchard: Mr. Speaker, does the Hon. Member for Saint-Jacques mean that investing $700 million in job creation is a restrictive measure? I find that hard to believe! We are investing money in job creation, and just because we have terminated a $20 million program that was costing $10,000 per young person, you are accusing us of taking restrictive measures. Measure for measure, I think I prefer those I am implementing to yours which have made hundreds of thousands of young people jobless in this country.


NATIONAL REVENUE
Mr. Simon de Jong (Regina East):: Mr. Speaker, my question is directed to the Minister of National Revenue and concerns the Scientific Research Tax Credit. We learned last week that only 172 companies have been audited out of a total of 1,800 and that the Department has already written off some $900 million. Why has the Government so quickly written off $900 million, and what special measures is the Government taking to minimize the public rip-off and recover as much as possible?


Hon. Elmer M. MacKay (Minister of National Revenue):: Mr. Speaker, as the Hon. Member knows, as a knowledgeable critic, the residue of this program has created tremendous problems. The Deputy Minister of National Revenue recently appeared before the relevant committee and gave a very good account of the current situation.
I can assure the Hon. Member and the House that our Department is not writing off any of these accounts for which there is a reasonable chance to protect the taxpayers' interests and all appropriate measures will be taken to make sure the taxpayers' interests are protected.


GOVERNMENT APPROVAL OF APPLICATIONS
Simon Leendert de Jong: Mr. Speaker, my supplementary question is directed to the same Minister. 1 want to know why the Government approved some $3 billion in SRTC applications after October 10, 1984, when it knew that many of the deals were at least suspect?


Elmer MacIntosh MacKay: Again, Mr. Speaker, the Hon. Member probably realizes that much of the program which lacked so much control was beyond the specific knowledge of the Department because in many cases the Department had no record, because of the way the program had been set up, as to who had taken advantage of it. When it was necessary to terminate the program there
March 17, 1986

had to be a certain element of fairness involved because within the program, which that did contain so many fraudulent schemes, or unfortunate instances of people talcing advantage of the public purse, there was a certain modicum of proper investment. We could not be arbitrary because we would have disadvantaged innocent taxpayers who had acted in good faith.


CANADA SHIPPING ACT
Mr. John A. MacDougall (Timiskaming):: Mr. Speaker, my question is directed to the Minister of Transport. The Canadian Council for Boating Organizations in Canada and many thousands of individual Canadians are very concerned about amendments to the Canada Shipping Act. Could the Minister tell the House whether or not every individual boat and canoe will be levied with an annual fee and whether or not single boat owners will have to meet the standards of the Canada Shipping Act?


Donald Frank Mazankowski: Mr. Speaker, the short answer to that question is no. I am aware of the statements that have been made by pleasure boat operators and members of the boating public arising from some erroneous and misleading statements perpetrated by the boat lobby. I think it is fair to say that the vast majority of pleasure boats will be excluded from those provisions of Bill C-75. I was before the committee to make that clarification, and 1 am sure that the Hon. Member will see that in the final legislative form.


Mr. Shields:: 1 have a supplementary question, Mr. Speaker.


Mr. Speaker:: The Hon. Member for Cape Breton-The
Sydneys.


PRICE OF CRUDE OIL
Russell Gregoire MacLellan: Mr. Speaker, my question is directed to the Minister of Energy, Mines and Resources. The Minister said that she wants to wait and see what happens to world oil prices before she takes action to help the Canadian oil industry. While she is waiting, western companies like Husky Oil, and Ontario companies like Algoma Steel, are laying off hundreds of employees. What does the Minister plan to do to save these jobs and to save the Canadian oil industry now facing devastation?
Hon. Pat Carney (Minister of Energy, Mines and
Resources): Mr. Speaker, I can assure the Hon. Member that we will not engage in the kind of knee-jerk reaction to price changes in which the Liberal Party engaged when it was in
Oral Questions
government, a reaction which led to the National Energy Program which devastated western Canada.


MINISTER'S POSITION
Russell Gregoire MacLellan: Mr. Speaker, it is the Minister's own policies that have created this uncertainty and feeling of panic in the energy industry.


Some Hon. Members:: Hear, hear!


Russell Gregoire MacLellan: Is she now going to turn her back on the energy industry and set it up for take-overs or even closure, Mr. Speaker?


Pat Carney: Mr. Speaker, the kind of panic and hysteria which the Hon. Member is exhibiting is just the kind of hysteric reaction the Governments of the producing provinces and our Government are attempting to avoid in this price war.
May I point out to the Hon. Member that neither the Governments of the producing provinces nor the industry are asking us to reregulate the industry as the Liberals did. None of them are asking us to go back to reregulation because deregulation of the industry has led to record drilling, record activity, and lower prices for consumers.


Donald Alex Blenkarn: I have a supplementary question, Mr. Speaker.


Mr. Speaker:: The Hon. Member for Hamilton Mountain.


EXTERNAL AFFAIRS
Ian Deans: Mr. Speaker, my question is for the Deputy Prime Minister. Does the Deputy Prime Minister have any information which would lead the Canadian Government to agree with the President of the United States when he says that Nicaragua poses a mounting danger which threatens the security of the United States?


Erik Nielsen: Mr. Speaker, I have to repeat the previous answers that I gave to the Official Opposition and to the Member's own Leader. I can do no better than refer the Hon. Member to Hansard for March 13 and to prior occasions with respect to the official position of the Government vis-a-vis Central America.


SUGGESTED THREAT TO SECURITY OF UNITED STATES
Ian Deans: Mr. Speaker, I have a supplementary question. I asked the Deputy Prime Minister

March 17, 1986
Oral Questions
to bear in mind that this statement was made last night by the President of the United States.
I ask again: Does the Canadian Government have any information of any kind which would bear out the suggestion by the President of the United States that Nicaragua poses a mounting threat to the security of the United States and, presumably, if that be the case, to the security of Canada? Have we checked that out? Do we have any information in that regard, and if so, what is it?


Erik Nielsen: Mr. Speaker, it does not make any difference to the formulation of Canadian policy, made in Canada by a Canadian Government, whether the President of the United States spoke last night, last week, last month or a year ago. Our policy has not altered one iota. It is as I have stated it today, and as has been stated by the Prime Minister and by the Secretary of State for External Affairs on so many previous occasions.


BANKS AND BANKING
Mr. Alan Redway (York East):: Mr. Speaker, my question is for the Minister of State for Finance. When the Bank of Canada rate was going up in January, the chartered banks put their lending rates up very quickly. Now that the Bank of Canada rate is falling, the chartered banks have been very slow to drop their lending rates. Will the Minister lean on the chartered banks to get them to bring their rates down?


Hon. Barbara McDougail (Minister of State (Finance)):: Mr. Speaker, 1 would like to point out to the Hon. Member that last week the chartered banks' prime rate moved down in anticipation of a Bank of Canada rate cut. I do not think the situation is quite as uneven as the Hon. Member is suggesting.
As you know, Mr. Speaker, there was a full percentage point drop in the bank rate. From what 1 read from corporate analysts and banking analysts, I am sure that rates will come down further, which simply proves that our budget policies are working in the market-place.


EQUALITY RIGHTS
Robert Phillip Kaplan: Mr. Speaker, in the absence of the Minister of Justice my question is for the Deputy Prime Minister.
Having followed the strong objections expressed by Conservative delegates in Montreal over the weekend to many of the equality recommendations which were already endorsed by the Government, can the Deputy Prime Minister give his assurance that the commitment of the Government will not be
weakened by that convention, especially on matters dealing with affirmative action, with women in the Armed Forces, and with sexual orientation?


Erik Nielsen: Mr. Speaker, the response of the Government has been tabled. It is there for the hon. gentleman to read and for the public to see.


Mr. Blackburn (Brant):: Lead your Party; don't follow.


Erik Nielsen: That is the Government's response.


WOMEN IN THE CANADIAN ARMED FORCES
Robert Phillip Kaplan: Mr. Speaker, if the Government intends to ignore the Conservative Party, can the Deputy Prime Minister tell us when there will be a clear statement by the Government on its policy about what changes will occur for women in the Armed Forces? When will we get that statement clearly from the Government as a result of the agreement it made to implement the equality provisions?


Erik Nielsen: Mr. Speaker, first the Government's response has been tabled. Second, the internal consideration that has to be given by the Department of National Defence with respect to reconciling its policies with that response is under way, and will be announced as soon as possible.


AGRICULTURE
Stanley J. Hovdebo: Mr. Speaker, my question is for the Minister of Agriculture. The Budget has increased farm costs considerably through the imposition of taxes on most farm inputs. The Budget did announce an extension of the 3 cents per litre fuel tax rebate, but this rebate is a far cry from the Conservatives promise to eliminate-


Mr. Speaker:: Order, please. Just a question.


Stanley J. Hovdebo: When will the Minister be bringing in legislation to eliminate taxes on farm fuels?


Hon. John Wise (Minister of Agriculture):: Mr. Speaker, I hope that the House of Commons sound system is working more effectively than my own voice is today. I want to correct the Hon. Member and remind him to reread our campaign commitment. We did not make a commitment to remove all of the tax on farm fuels.
I am surprised, Mr. Speaker, because of the substantial package in the Budget, that the Hon. Member is still critical of the financial transfer from our Government to the farming community.
March 17, 1986


PRIVATE MEMBER'S MOTION
Stanley J. Hovdebo: Mr. Speaker, since the Minister is unwilling to bring in legislation for the elimination of farm fuel taxes, will he support my Private Member's Motion, which would require the Government to do just that?


Derek Nigel Ernest Blackburn: Save your voice and say yes.


John Wise: The short answer to that question would be no, Mr. Speaker.


AUTOMOTIVE INDUSTRY
Joseph Lloyd Reid: Mr. Speaker, my question is directed to the Minister responsible for Regional Industrial Expansion.
It is reported that General Motors will be making an investment of $2 billion to automate and improve the Oshawa assembly plant.


John Edward Broadbent: It is more than $2 billion.


Joseph Lloyd Reid: Since jobs in the auto industry are basically located in the auto parts manufacturing sector, what proportion of Canadian content will go into parts sourcing for that assembly operation?


Hon. Sinclair Stevens (Minister of Regional Industrial Expansion):: Mr. Speaker, the Hon. Member is quite correct. General Motors is planning to make an announcement later this month. The tone of the announcement will be very upbeat. It will be talking about the investment of hundreds of millions of dollars in Canada.
I want to assure the Hon. Member that some of that investment may also spill into his area, and I will be very pleased to see that.


INDIAN AFFAIRS
B. Keith Penner: Mr. Speaker, I have a question for the Minister of Indian Affairs and Northern Development. Is he familiar with the view expressed in the task force report on Indians and natives that government housing programs should not serve as an incentive to encourage Indian people to continue living in their communities?
Does the Minister think that Indian people should be forced out of their communities and into cities where for them prospects for employment are next to nil, and where for them adequate and affordable housing is nearly impossible to obtain?
Oral Questions


Hon. David Crombie (Minister of Indian Affairs and Northern Development):: Mr. Speaker, I think the Hon. Member may want to look at that section again to see the context of it. Having said that, I think the Member is well aware that he has the opportunity to bring his views before the committee when that matter is discussed.


TASK FORCE'S VIEW
B. Keith Penner: Mr. Speaker, 1 am interested in the Minister's views. He is the man responsible.
Does he accept the task force view that isolated Indian communities should be satisfied with substandard quality in their housing?


David Edward Crombie: Mr. Speaker, I think the Hon. Member is aware that this Minister does not believe that Indian people should be satisfied with substandard quality in anything.


LUMBER EXPORTS-PROPOSED UNITED STATES LEGISLATION
Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, my question is for the Minister responsible for Forestry. He will know that the Gibbons Bill is presently before the U.S. Congress with a very good chance of passing before the summer.
In view of the fact that this measure will have devastating consequences for many British Columbia communities and, in particular, for hundreds of thousands of forest workers in the IWA and other forest unions, when will the Minister get behind the forest industry in British Columbia and show some decisive leadership to ensure that Canadian softwood lumber exports will enjoy continued access to American markets?


Hon. Gerald S. Merrithew (Minister of State (Forestry)):: Mr. Speaker, I do not know where the Hon. Member has been. He must be aware, of course, that even as late as last week our officials were working with the U.S. administration officials. There is an additional meeting in the middle of April. We have been working with provincial Governments, with industry and labour in dealing with this issue for many, many months.


PRIME MINISTER'S DISCUSSIONS WITH UNITED STATES PRESIDENT
Svend Johannes Robinson: Mr. Speaker, in view of the fundamental importance of this question to B.C. forest workers, as well as other forest workers across Canada, will the Minister assure the House and the people of Canada that the matter will be raised directly by the Prime Minister with the President of the United States during the upcoming summit meetings in Washington?

March 17, 1986
Oral Questions


Gerald Stairs Merrithew: Mr. Speaker, I assure the Hon. Member that ithas already been raised with the Secretary of Trade of the United States, with various officials in the U.S. administration, and with Congressmen. It will be raised by the Prime Minister and the President.


AIRPORTS
Mr. Brian Tobin (Humber-Port au Port-St. Barbe):: Mr. Speaker, my question is directed to the Minister of Transport. He is aware of the 17th Century feudal labour practices of All Cap Baggage Service being practised at Pearson International Airport in respect of skycaps. What is the Minister doing to put an end to this modern day feudal experiment being conducted on the property of Canadian taxpayers by a company at Pearson International Airport?


Donald Frank Mazankowski: Mr. Speaker, regional officials are looking into and investigating the matter. I should also advise the Hon. Member that some 30 of 40 of the individuals involved sent a petition to me in support of the arrangements which have been made there and did not want to be associated with the dissenting group to those arrangements.


INQUIRY OF THE MINISTER
Brian Vincent Tobin: Mr. Speaker, is the Minister of Transport telling the Parliament of Canada that he endorses or supports a policy at the airports or in any other field where individuals have to pay hard cash, up front, for the right to work?


Donald Frank Mazankowski: Mr. Speaker, I did not say that at all. I was just trying to provide the Hon. Member with some information. I wish he would pay attention to my answers.


PUBLIC SERVICE
Michael Morris Cassidy: Mr. Speaker, my question is for the President of the Treasury Board. Ten days ago employees of the Public Service Staff Relations Board were informed that Cabinet had decided to cut 35 jobs in their agency "following recommendations made by the Nielsen Task Force on Program Review". Will the Minister inform the House how many additional public service jobs are at risk as a consequence of the Nielsen task force report on top of the
15,000	public service jobs which were announced to be cut last spring?


Hon. Robert de Cotret (President of the Treasury Board):: Mr. Speaker, obviously the Hon. Member has failed to listen to many of my answers to the very same question over the last few months. I return to a press release which I made public on January 17 and on which I stand firm. At that point I said: "Reductions resulting from the implementation of recommendations of the ministerial task force on program review are included in the 15,000 person-year reduction figure over five years". That is what I have been saying to the House ever since, and before. I wish the Hon. Member would pay attention to my answers.


REQUEST FOR GOVERNMENT GUARANTEE
Michael Morris Cassidy: Mr. Speaker, perhaps I could nail this down. Is the Minister aware of the widespread concern among members of the Public Service because of the cuts and compression in public spending, the $500 million in cuts announced at the time of the Budget, and now the Nielsen task force review? Could the Government give us an unequivocal guarantee that there will be no further job cuts in the Public Service as a consequence of the Nielsen task force beyond the 15,000 cuts over five years announced last year?


Mr. Speaker:: Order, please.


Robert René de Cotret: Mr. Speaker, the widespread unease comes largely from the Hon. Member opposite.


Some Hon. Members:: Hear, hear!


Robert René de Cotret: That is panic politics. It is gutter politics. We have said all along that we would reduce, since last May-


Some Hon. Members:: Oh, oh!


B. Keith Penner: Bad language; you made a mistake.


Some Hon. Members:: Withdraw.


Mr. Speaker:: Order, please. The comment I heard was about politics, but I think it was inappropriate. Therefore, the next question.


CANADIAN JOBS STRATEGY
Donald Alex Blenkarn: Mr. Speaker, my question is directed to the Minister of Employment and Immigration. With reference to the Minister's Canadian Jobs Strategy, she has a Job Entry Program.


Ms. Copps:: What about the Canadian unemployment strategy?


Some Hon. Members:: Sh-h-h!
March 17, 1986


Donald Alex Blenkarn: Would the Minister tell us how much money she has in the Job Entry Program in respect of young people who desire to enter the workforce, and how many young people will be involved in that program?


Hon. Flora MacDonald (Minister of Employment and Immigration):: Mr. Speaker, the Job Entry Program of the Canadian Jobs Strategy to date has approved 285 projects involving some 9,000 young people. These are projects in places like St. John's, Newfoundland, where young people are being trained for jobs in the broadcasting industry; in Sydney, Cape Breton, where young people are being trained for jobs with a local electronics firm; in Halifax, Nova Scotia, where black youth are being trained for jobs in the computer industry-


Mr. Speaker:: Order, please.


Some Hon. Members:: More! More!


IMMIGRATION
Mr. Sergio Marchi (York West):: Mr. Speaker, my question is directed to the Minister of State for Immigration. On January 27 I raised opposition to the Government's imposition of new immigration visa fees. The Canadian Helsinki Watch Group has now stated that this contravenes and violates the Helsinki Accord. Given that the imposition of fees has met with disapproval here at home and now threatens our standing within the international community-


Mr. Speaker:: Order, please. That is a very long preamble.


Sergio Marchi: -will he immediately revoke the imposition of fees and return to a policy based upon compassion and some sense of progressiveness?


Hon. Walter McLean (Minister of State (Immigration)):: Mr. Speaker, I assure my colleague that the user fees do not in any way violate the intention of the Helsinki Accord which, as the Hon. Member will know, provides for freedom of movement of immigrants. The fee is only a portion of the cost, approximately a quarter of the total cost. Also, the Hon. Member will know that it does not apply to refugees or those in designated classes.


MINISTER'S POSITION
Sergio Marchi: Mr. Speaker, does the Minister care about what Canadians are saying and what the world is trying to tell us before next month's international conference? If so, is he prepared to have the courage to revoke immediately these fees which are contrary to the spirit of the conference we will be attending next month?
Oral Questions


Walter Franklin McLean: Mr. Speaker, I assure the Hon. Member that the principles of universality and non-discrimination are key to our Canadian policies and are not in question. I should also inform him that within the Helsinki signatory countries there are in many cases fees which are greater than those imposed by Canada, including those of our neighbour, the United States, and of West Germany.


CHILD CARE
Neil Young: Mr. Speaker, my question is directed to the Minister responsible for the Status of Women. Given that 75 women's organizations are meeting in Ottawa today with the Advisory Council on the Status of Women, would the Minister not agree that this event provides the Government with the perfect opportunity to fulfil its election campaign promises to provide additional funds for child care services?


Walter Franklin McLean: Mr. Speaker, I thank the Hon. Member for raising the matter and drawing to our attention that the Government has made funds available so that the Advisory Council on the Status of Women can bring together some 75 leaders of national groups to talk about the economic impact of policies in Canada on the lives of women. I assure the Hon. Member, having attended the opening session this morning, that the vital economic importance of child care was signalled.


REQUEST FOR ADDITIONAL FUNDING
Neil Young: Mr. Speaker, that is nice to hear, but would the Minister not agree that in order to keep some semblance of good faith with Canadian families, now is the time to fulfil election campaign promises by providing additional moneys for day care and child care?


Walter Franklin McLean: Mr. Speaker, the Hon. Member knows that today the task force named by the House is opening its hearings in Atlantic Canada. We have before us a substantive document in the Katie Cooke Task Force Report, and we will have recommendations from the House task force before the end of the year, after which the Government will be in a position to look at a number of options to deal with this vital issue.

March 17, 1986
Borrowing Authority Act POINT OF ORDER


ALLEGED UNPARLIAMENTARY LANGUAGE
Michael Morris Cassidy: Mr. Speaker, 1 rise on a point of order. During Question Period the President of the Treasury Board (Mr. de Cotret) said: "That is gutter politics", in response to a question which I asked. I find that unparliamentary and I believe that you did too, Mr. Speaker, because you asked the Minister to desist from completing his answer. I ask you to review the matter and, in effect, ask the Hon. Minister to withdraw the unparliamentary language which was used in the House.


Robert René de Cotret: Mr. Speaker, whether they are unparliamentary or not, I will be very happy to withdraw the words.


SUPPLEMENTARY QUESTIONS
Jack Wendele Shields: Mr. Speaker, with all respect, I would seek clarification of the situation when a Member stands for a supplementary question and yells "supplementary", and the Speaker is not inclined to give him a supplementary question at that time, and the Member sits down. Are we now changing the rules such that if the Speaker looks at a Member when he is sitting, encouraging him to stand up, the Member should then stand? Are you going to call the shots?


Some Hon. Members:: Order.


Mr. Speaker:: The Hon. Member for Athabasca (Mr. Shields) claimed a supplementary question. At that time I had already begun to recognize the Member for Cape Breton-The Sydneys (Mr. MacLellan). As it seemed to me appropriate, 1 looked to see if the Hon. Member for Athabasca was rising again. The Hon. Member for Athabasca chose not to rise again. Therefore, I recognized another Member. The Hon. Member for Athabasca knows that Members rise continually seeking the eye of the Chair if they wish the Chair to recognize them for a question.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mrs. McDougall that Bill C-99, an Act to provide borrowing authority, be read the second time and referred to a legislative committee.
Ian Deans: Mr. Speaker, just before the lunch break I was pointing out that there was a
certain consistency evident with regard to what the Conservative Party was like when it was in Opposition and what it is now like in Government. The recent comment of the Member for Athabasca (Mr. Shields) is consistent with what I was talking about. I was expecting that at any minute he would be joined by other back-benchers who would charge the Speaker's chair in anger over something which was, in fact, done quite properly.
There is a necessity for the Government to establish for itself some consistency in the way in which it approaches public policy. It cannot have it every which way. The Government cannot on one day be for the concept of universality, and on the next day argue against it. The Government cannot, through the Prime Minister (Mr. Mulroney), claim that universality is a sacred trust and then, in its very next Budget, say that universal access is really what it is talking about. I think it is fair to say that those of us who have followed that debate are able to distinguish quite clearly between universality as it has been practised in Canada, and something called "universal access", which may or may not make available to those who need it the kind of help they need.
This Bill ought not to be passed now, Mr. Speaker. It is based on information contained in the budget papers which is clearly faulty. They contain references to interest rates and oil prices which are clearly not sustainable in today's society. Therefore, I move, seconded by the Member for Saint-Denis (Mr. Prud'homme):
That this Bill be not now read a second time but be read a second time this day six months hence.


Mr. Speaker:: The debate will now be on the amendment, it being in order.


Brian Vincent Tobin: Mr. Speaker, I am pleased to rise in my place in support of the amendment proposed by the Hon. Member for Hamilton Mountain (Mr. Deans) who was his normal articulate self for the minute or so that he took to complete his debate.
There is a very good reason why Bill C-99 ought to be given a six-month hoist. As a matter of fact, inasmuch as the Bill is symbolic of the Government's financial plan, more than the six-month hoist, it ought to be given the boot.
The Government of Canada today has a fiscal plan which represents the vision of the Party in power. The other day, with a great deal of exasperation and disbelief, we heard the Prime Minister (Mr. Mulroney) say, while appearing before some of his friends in Montreal: "I have a vision". He went on to talk about that vision. He assured us that if we would be patient until the year 2020 or 2030, he would get around to delivering on that vision. I do not think the Government's vision will not be realized until the year 2030. I think the vision is much more short-sighted. It is a very clear vision which they understand and have mapped out. However, they are not prepared to talk about it in plain language with the people of Canada.
This reminds me a little of the kind of frenzied paranoia of Howard Hughes locked away in the penthouse of the hotel he bought in Las Vegas, Nevada. He was shut away from the real
March 17, 1986

world, refusing to acknowledge its existence, but attempting to pull some strings to shape that world in the way in which he thought most appropriate. That is the kind of bunker mentality which has gripped the Government after a shockingly short period of time. The Government has a vision which it discusses only in the back rooms, locked away from the light of day.
If one looks closely, one can begin to discern that vision in the February 26 Budget. That Budget imposes upon middle and low-income Canadians the largest single tax increase in the history of the country. Inasmuch as deficit reduction is real rather than manufactured in the Minister's mind, by playing with the numbers the Budget takes fully two-thirds of any deficit reduction there is out of the pockets of consumers and only one-third out of the Government's own pocket through controlled spending. While the Government is accomplishing a highwayman's raid on the pockets of middle and low-income Canadians, it has given the corporate sector a 22 per cent reduction in its tax rate over the next four years.
While all of this is being achieved, the Government continues the vulgar policy of the capital gains tax exemption, which policy gives a new definition to the meaning of "greed". That exemption gives a new definition to the meaning of "vulgarity" and "greed", because it gives $125,000 of taxpayers' money tax free to an individual with the wealth required to go to the Barbados, Florida, or Europe, and to speculate in real estate without creating a single job in the country. That is why it is vulgar and represents a brand new dimension of greed.
It is a policy which does not reward success but abuses the concept of free enterprise. That policy spoils the basis of capitalism practised in a sound and responsible manner. I am a Liberal. I believe in the free enterprise system.


Some Hon. Members:: Oh, oh!


Brian Vincent Tobin: I believe in a system which allows individuals to achieve their full potential. I believe the free enterprise system does that. However, as much as I defend that system, I recognize as well that it has to work for all of our citizens. When you have a Government which represents an elitist minority, which abuses the system in a vulgar manner and rips off the taxpayers, then the intrinsic support which our citizens should have for a free enterprise system, because it ultimately is the best, is going to be dissipated.


Alan Redway: There is no rip-off.


Brian Vincent Tobin: When you abuse people, when you ask them on one hand to accept the biggest single tax increase in Canadian history-


Alan Redway: What is your philosophy?


Brian Vincent Tobin: -as part of their share of reducing the deficit, and at the same time continue this vulgar-


Alan Redway: What is your policy?
Borrowing Authority Act


Brian Vincent Tobin: -capital gains tax exemption and a $125,000 gift to those who need it least, then you lose support for the free enterprise system. I come to this House in defence of the system. I come to this House to speak on the Budget in defence of average Canadians. I do not see a free enterprise system as something to benefit only those who have the most wealth. I do not find it necessary, as do Members opposite, to below like a jackal in the night when someone dares to stand up and suggest the system works best when it benefits all of our citizens, not just those who already have. Members opposite would do well to speak to the working men and women who continue to build this country. They should pay less attention to those who, through their own hard work, God bless them, have achieved success and who now, in some paranoid frenzy like Mr. Howard Hughes in his last years, God rest his soul, want to devise a means to reduce the deficit. You have to do it, but God forbid, do not touch this colossal arsenal of wealth I have acquired. It gives them the power to send Conservative Members of Parliament to protect their interests. That is what is going on and it is time to call a spade a spade.
The people of this country have a vision, not the Prime Minister (Mr. Mulroney). They have a vision of a free enterprise system which rewards success and hard work. They and their children can progress. Through all the ups and downs, domestically and internationally, we can build a Canada that all Canadians can be proud of. They have a vision where they are prepared to do their part to improve the economy; yes, even to reduce the deficit, even in my own riding with 25 per cent unemployment. We are prepared to do our share but we will be damned if we are going to be taxed with the biggest single increase this country has ever seen at a time when Members opposite gloat and smile and laugh at a vulgar tax exemption which gives those who already have an unfair $125,000 tax gift. It raises my Irish ire on this sacred day, St. Paddy's Day. It is a wonder I can stand still.
What about the hidden agenda this Government has? The Nielsen task force report is the hidden agenda. The Government, even though it released the report in the House of Commons bearing the seal of the Government of Canada, does not have the courage to call it as its own. What does it recommend? It recommends the abandonment of regional development policy, the treating of Atlantic Canada as if it were some Third World appendage, stuck off at the end of Quebec. It recommends that services be cut and people be penalized for choosing to live in that part of this country. It recommends that people who live in the North, who do far more to protect our interests and sovereignty than a $500 million polar ice-breaker, be cut off from the services they now receive from the Government. It is a short-sighted policy, one which will destroy our sense of national unity and pride of country from one end of this land to the other.
I beg Members opposite to go out and put your finger on the pulse of the land. Talk to our citizens where they live. They will see that a revolt is brewing because taxpayers are saying; "I have had enough and I will not take it anymore."

March 17, 1986
Borrowing Authority Act


Simon Leendert de Jong: Mr. Speaker, I, too, wish to join in the debate on the amendment to delay the borrowing authority for some six months. The Government is asking this House to allow it to borrow some $22 billion. We have often heard, particularly from Members opposite, about the importance of tackling the deficit and the evil sub-deficit. In many ways I agree. The deficit is harmful. Certainly the billions of dollars we have to spend every year just to pay interest on our debt cuts back on the ability of Government to provide the goods and services so badly needed. Yet I am very disturbed by the way government Members, and I must say a fair number of newspaper columnists, present the debate.
The Government is talking about options. The Nielsen task force report, the Government claims, deals with options. We will have to decide which of these options to accept. The Government has also presented Parliament and the public with two options on how to deal with the deficit: Cut back on our programs and Government expenditures, or increase taxes. In this Budget the Government cut back on a variety of programs the effects of which we will feel in years to come. As well, walloping new tax levys have been added to the average wage earner. When you take out your pencil and little calculator you will note that those in the higher income brackets and the larger corporations are not being called upon to make the same kind of sacrifices. Again the wage earners are being asked to fork over a little more in the name of fighting the deficit. When we add all the new taxes this Government has levied they come to close to $1,300 a year for your average family.
Of course we are beginning to hear the hue and cry across the country that this is unfair. We are beginning to hear the rumblings of a tax revolt by middle-income earners. They are telling the Government that it is asking us to tighten our belts, why doesn't it tighten its belt? What I am afraid of is, by presenting this limited option the Government is setting up the Canadian people. By suggesting there are only two choices, either increase taxes or cut services, the Government is hoping to get middle-income wage earners so upset that in the next Budget the Minister of Finance (Mr. Wilson) will drastically reduce government expenditures, meaning mainly social programs. I am really afraid we are being set up. The option is not just between more taxes or less government programs and expenditures, particularly on social programs.
There is a third aspect which, on the whole, the Government continues to ignore. That is the hidden tax breaks, the government expenditures that never appear on the books. In my speech on the Budget I went into this in some detail. I related how there are some $30 billion in deferred taxes. I suggested to the Government that it should charge 10 per cent interest on that to be able to bring into the public coffers an extra $3 billion a year and reduce our deficit by that amount. I related the situation of where we see the Royal Bank of Canada in 1982, having some $358 million in profits and assets of over $85 billion, not paying one cent of tax. The teller that works for the Royal Bank of Canada in 1982 paid more dollars and cents in taxes than did the Royal Bank of Canada.
The Royal Bank of Canada is just the tip of the 'i6e-berg. The kid that pumped gas for Shell Oil in 1982 paid more taxes in terms of dollars and cents than did Shell Oil. I suggest it is these tax breaks, this hidden side of our Budget, the figures that we never see on Budget night, the lost revenues because of the tax breaks and tax loopholes, that is the cause of the deficit being as high as it is.
If the banks of this country had paid their legislated tax rate of some 49.5 per cent the public treasury would have been richer by some $4 billion. From 1977 to 1983 most of the banks, even though they had billions of dollars in assets and earned hundreds of millions of dollars every year, paid a very small amount of taxes. In fact some of them, like the Royal Bank in 1982, paid no taxes at all. In fact, they even got a tax credit that year and the Government gave them some $26 million as a tax credit. Can you believe it? We have given them money.
This is why I suggest to the Canadian public that the debate should not be between more taxes on your middle-income earners, or Government cut-backs, but that there is a third aspect to this, the tax breaks that the wealthy and the large corporations have been receiving in this country year after year after year.
If the Government, and the previous Liberal Government, had practised a policy of fair taxation we would not have the deficit which exists today. The suggestion that as Canadians we are living beyond our means, that our social programs are too fat, that we have got to tighten our belts, I find is so much untruthful rhetoric.
If you compare what we in Canada spend as part of our Gross National Product on social programs you will find that it is one of the lowest of the western industrialized nations. It is lower than France, Germany, Holland, Italy and England.
To say that we as a country cannot afford our social programs, that the money we spend on health and education and unemployment insurance and on pensions is too high, to say that a country as rich as Canada cannot afford those programs while Italy, Holland, France, Germany and England, Denmark and Sweden all can, I say is to be false. The debate today should be on whether we have fair taxation, or whether we should allow the rich and the large corporations to continue having tax holidays in this country. If the Government is serious about solving the deficit, let it bring in fair taxation through tax reform in this country. We will solve our deficit and this country will be on a sound financial footing. That is why I support the motion before us today, to hoist this Bill for six months.


Mr. Gaston Isabelle (Hull-Aylmer):: Mr. Speaker, 1 also welcome this opportunity to take part in the debate on the amendment to Bill C-99, the Borrowing Authority Bill. It is also a pleasure to express my support for the amendment in the name of my hon. friend from Hamilton-Mountain (Mr. Deans), seconded by that tireless knight of federal policies, the Hon. Member for Saint-Denis (Mr. Prud'homme).
March 17, 1986

Mr. Speaker, there are two points I would like to raise in the House today. The first one concerns what is happening in the National Capital Region to federal public servants, who always seem to end up bearing the bount of the cuts the Government is making or will decide to make. As we all know, the National Capital Region has a much higher density of public servants than any other area. There are about 102,000,
I believe.
It is therefore obvious that the cuts announced by the Government will have an impact on this population, which 1 would call a second class population considering the way these people are being treated by the Government. The upshot is that several thousand Public Service employees are going to lose their jobs, and this will have a major impact on the National Capital Region and will depress the economy of the Ottawa-Hull area. Mr. Speaker, when 1 refer to the Ottawa-Hull area, I am in fact referring to the territory covered by the National Capital Region, Ottawa-Hull.
Mr. Speaker, what I find surprising is that with all this concern in the Public Service today, and especially in the Ottawa-Hull region, no one seems to be defending these public servants who are either losing or about to lose their jobs, and meanwhile, there are people in the Government who are doing everything in their power to urge them to leave, to resign. People are being harrased in the Public Service today, in order to reduce the number of public servants in the Ottawa-Hull area, and I am sure that this is happening across Canada as well.
I am surprised that the Public Service Alliance has not reacted to these goings-on. I wonder whether it is really concerned about protecting the interests of public servants and about the fact they are disturbed about employment cuts in the National Capital Region, but in any case, the Public Service Alliance does not seem to be moving on the subject at all.
However, I remember that when the Public Service Alliance had problems, these people would come and see us and ask us why we didn't do more to protect public servants.
At this point, I think I ought to ask them the same question: What are you doing about the fact that your public servants are about to lose a considerable number of jobs and about the harassment that is becoming the rule throughout the federal Public Service?
Mr. Speaker, there is another problem, which brings me to the Nielsen Report tabled a few days ago, and it concerns the National Capital Commission. When I consider what has been said or written about the National Capital Commission I have the impression that somebody wants to belittle the capital of Canada, in the sense that, for all practical purposes, the national capital of Canada would simply become a dull city like so many others in this country.
Mr. Speaker, let us not forget that the capital of a country is the centre of the national soul. Apparently we in the National
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Capital Region are unable to realize that there has to be a national centre where all Canadians will feel at home. Unfortunately it would seem that the Nielsen Commission wants to abolish the National Capital Commission and make it a part of the Department of Public Works.
In the House of November 8, 1985, Mr. Speaker, I was somewhat wary when I asked the following question to the Minister of Public Works concerning the possible abolition of the National Capital Commission: "In view of the fact that there has apparently been no announcement as to future responsibilities of the National Capital Commission, would the Minister tell the House if there is any truth to the rumours that the National Capital Commission will be abolished or that its operational responsibilities will fall under the Department of Public Works." That is exactly what has now been proposed in the Nielsen Report. The Minister replied at that time: Mr. Speaker, if the Hon. Member is worried by rumours,
I wish to tell him on one hand that I think he has nothing to be worried about. Mr. Speaker, I think I had reason to be concerned. On the other hand, the Minister went on to say, the Nielsen Commission, as everyone knows, should bring forward a rather comprehensive report by the end of the year. In the context of this report, I am much more optimistic than the Member for Hull-Aylmer as regards the future of our beautiful capital.
Well, Mr. Speaker, the cat is out of the bag. They are more or less violating the capital of Canada through what amounts to the abolition of the National Capital Commission.
Mr. Speaker, people are deeply shocked because according to the task force report, the National Capital Commission has shown a lack of concern for public money when it signed opened agreements. For instance, there was this agreement with the Province of Quebec calling for road construction with cost shared equally, without spending limits or time schedules.
Yet, Mr. Speaker, section 10(2)(e) of the Act states that the National Capital Commission must "cooperate or engage in joint projects with, or make grants to, local municipalities or other authorities for the improvement, development or maintenance of property of the National Capital Region."
Mr. Speaker, ever since Queen Victoria decided in 1899 that Ottawa would be the capital of Canada, some 20 years after Ottawa had been designed as the Canadian capital, the Government set up the Ottawa Improvement Commission with a mandate to provide the capital with a national character and atmosphere which it had great difficulty to maintain over the years. This institution, the forerunner of the National Capital Commission, gave the National Capital is true identity through arrangements with both Ontario and Quebec sides of the Ottawa River. It had greatly favoured the Ontario side when, in the 1930's the then Prime Minister had a vision, just
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as had Sir Wilfrid Laurier in the 1900's, of a capital which would reflect the heart and soul of all Canadians.
Again, each time a prime minister failed to get involved directly in the future of the National Capital of Canada, there has always been an unfortunate delay, because the vision of Canada and the national capital that prevailed in 1899 was momentarily abandoned. And each time a prime minister got directly involved in the development of the National Capital Region, things changed a great deal, Mr. Speaker.
What 1 want to say is that the Nielsen report has simply deprived the Capital of Canada of any future meaning. It would destroy perhaps 100 years of achievement on the part of the National Capital Commission. I am sure that my colleague the Hon. Member for Ottawa-Carleton (Mr. Turner) will have something to say on behalf of the National Capital Commission in favour of the development of the Canadian Capital. Just as I do, he represents a riding which is proud to belong to the National Capital Region. I am aware of the problems which my hon. friend is having with the American embassy.
1 know that there will be problems with the National Capital Commission, but I must say one thing, Mr. Speaker, as I have just pointed out, in the national interest, only, whether the decision is favourable or not, the Prime Minister should become directly involved and deal with this important problem.
This is what I wanted to say to this honourable assembly, and I am certain that there will be a rather lengthy debate on this matter because the National Capital comes under legislation which will have to be abrogated or amended, unless we simply maintain the status quo.


The Acting Speaker (Mr. Charest):: Debate. The Hon. Member for Winnipeg-North Centre (Mr. Keeper).


Cyril Keeper: Mr. Speaker, it gives me pleasure to take part once more in this debate, this time to discuss the motion to hoist the bill for a six-month period.
Mr. Speaker, the purpose of this legislation is to authorize the Federal Government to borrow $22 billion. However, we have to ask ourselves why the Government wants the authority to borrow such an amount. The borrowing policies of the Government are linked with its budgetary policies and it is on these budgetary policies that this request for more money is based.
Mr. Speaker, the Government has focused its economic strategy on the deficit. According to the Government, the deficit must be reduced if we are to have economic recovery. The Government decided to increase taxes for ordinary Canadians while reducing the taxes paid by the wealthy. It seems to me, Mr. Speaker, that the Government is using the deficit to scare ordinary Canadians into supporting its economic policies. Instead of scaring the public, the Government
should be using reason to urge the public to support its economic policies. If it is seriously committed to deficit reduction why make gifts to the well-off and provide tax exemptions for people who make large capital gains?
Mr. Speaker, if the Government wants to reduce the deficit, why reduce the taxes of large corporations? It seems to me that the Government is not really serious in its efforts to reduce the deficit. It is certainly not going about it the right way if it wants to convince ordinary Canadians to support its economic policies. We must also wonder about the approach of the Government to deficit reduction. I would like to give an example. There was an analysis of the recent Budget in The Financial Post of March 8, 1986. Three examples were given to illustrate the impact of this Government's budgetary policy on the Canadian taxpayers. For instance, if someone has an income of $40,000 a year including a work income of $35,000, investment gains of $4,000 and interest gains of $1,000, his taxes will increase by $8,000 a year. That is the impact the Budget will have on such a taxpayer. However, someone with an income of $60,000 a year will pay $1,000 a year fewer taxes. That seems extraordinary, Mr. Speaker. It is difficult to understand how the Government can increase the taxes of people who earn $40,000 a year while reducing the taxes of people with an income of $60,000 by over $1,000 a year. That is extraordinarily unfair!
The third example given by that newspaper to show the impact of the budget on people earning $250,000 per year indicates that their tax rate will be reduced by $5000 per year. This is really unfair, Mr. Speaker.
How can this Government justify a $5000 yearly reduction for people earning over $100,000 while increasing taxes for ordinary Canadians earning $40,000 per year? This is definitely unfair and useless, this is also ineffective where the economy is concerned because the Government will be taking huge amounts of money from the middle class, the people who buy all those things to meet their needs. The reduced income of the middle class will slow down economic growth. It will have a negative impact on economic growth.
Mr. Speaker, it is essential for the Government to reconsider its economic policy and its unfair approach to taxation.
Mr. Speaker, it is unbelievable for the Government to say ... and I am coming to a close, Mr. Speaker-that we should all pay for the deficit, for the waste of recent years, while distributing the burden in a most unfair way.


Sheila Maureen Copps: Mr. Speaker, I find it rather surprising that the Government should continue to ignore the pleas of the people and ask the Members of the Opposition to approve the Bill to finance the Government without even giving us the chance to examine its current expenditures.
March 17, 1986

Mr. Speaker, if this is a meaningless matter for the Government which is spending billions of dollars, it is not a meaningless matter for the unemployed. We know that this Government has reduced the budget by $200 million at the expense of young and older unemployed in Canada.

I arrived in my constituency office in Hamilton this morning to pick up a stack of applications concerning the so-called summer seed program, the Conservatives' answer to job creation in Canada. With the applications was a little notice from the Department suggesting that within literally the next six hours 1 was to determine whether or not these were valid projects which would contribute to the Canadian economy and to the assistance and education of our young people.
1 wish to tell Hon. Members that when 1 see the Government talking about its new form of job creation and I am faced with consultation concerning literally dozens of applications from the Dairy Queen, 1 hardly think this is the new method of privatization for Canadians. 1 have nothing against the Dairy Queen. I had a summer job working at a Dairy Queen when I was a young student. Yet we see the same members of the Government standing here in the House of Commons day after day justifying the cutting, the virtual assassination, of the Katimavik program. This was a program which reached out to young people across the country. The Government cut it on the grounds that it would cost $10 million. I think that is an utter disgrace.
I am happy to see that the Hon. Member for Burlington (Mr. Kempling) is here in the House. As well, I received a note, and I think the public should be made aware of the so-called job-creation program, which states that the Hon. Member for Burlington announced this week a grant of $38,515 to train two unemployed individuals, one as a kennel assistant and the other as an animal control licensing officer. The announcement appeared in the Burlington Post of Sunday, March 2. It is a big announcement, part of the Government's new job-creation program.
Essentially, this announcement refers to the spending of more than $17,000 per job for the creation of a position of dog-catcher and licensing agent. This at a time when Government Members have the gall to stand in the House of Commons and argue that the Katimavik program had no merit because it took unemployed young people who had no hope and sent them on job experiences across the country. The Government now plops down close to $38,000 to hire a kennel officer. The Government's priorities are totally skewed.
1 realize I should not be so concerned about this. 1 cannot believe that the Government is asking us today to pass the borrowing authority Bill in order that we can turn over billions of dollars to the Government which is supposedly bent on the new focus of privatization and job-cutting. In one area the Nielsen task force report was right in that it pointed out the $16 billion in giveways to corporations. One can see that the corporations are hot to trot. They will be in there at the public trough. With respect to these new government programs, the Oshawa group has applied for summer job-creation programs
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throughout the whole of Ontario so that it can teach people how to stock grocery shelves. The Government is cutting and slashing Katimavik and forcing a Senator to his knees in the lobby of the Senate at the same time as-


Some Hon. Members:: Oh, oh!


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


Sheila Maureen Copps: -at the same time as the Government is telling the public we should pay the Oshawa group so it can teach people how to stock grocery shelves.


John Barry Turner: Oh, grow up.


Sheila Maureen Copps: I am being told by the Hon. Member for Ottawa-Carleton (Mr. Turner) to grow up. I would like to tell him, if he is interested in job creation for young people, that he had better take a second look at these programs-


John Barry Turner: We've done more for your people than you turkeys did in 20 years.


Sheila Maureen Copps: -these programs that are supposed to be reflective of a new Conservative approach to privatization. I see that the Dairy Queen, 7-Eleven or another multinational conglomerate will be getting hundreds of jobs paid for by the taxpayers so that people can work for $4 per hour or the minimum wage, whichever is less, because, according to the Government program, they have to pay minimum wage. We see that we will be hiring people to work as clerks in stores. If the people of Canada could go through these job-creation programs, which were plopped on my desk and which I was given approximately six hours to analyse-


John Barry Turner: That's all I got.


Sheila Maureen Copps: That's all you did get. I would like to know from the Minister of Employment and Immigration (Miss MacDonald) why she is calling upon Members, through this farcical consultation, to approve the hundreds and indeed thousands of projects just so that she can rise in the House to announce them when in fact there has been no planning. Hon. Members were given approximately two weeks. My original letter to the Minister on the new Challenge '85 program crossed my desk some time around February 28 and I was advised at that time that 1 had approximately seven days to contact every employer in my riding so that they could take advantage of these programs.
I suggest that there are some good private sector programs here. There are some private sector employers who have taken the time to analyse and develop a program that will be for the good of the workers involved. For example, Provincial Kitchen Cabinet Custom Woodworking Limited is run by a gentleman by the name of Louis Tonellotto from my riding. He has put together a project that will give a young person a chance to learn custom woodworking. That is a viable and well directed private sector program. However, people, are looking for

March 17, 1986
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summer help at the Dairy Queen, help paid for by the taxpayers, as the new example of Conservative privatization, this at a time when the Ontario Museums Association is being told that it cannot hire summer curators because the museums are currently receiving money from municipal Governments, and that means that they are only eligible for the difference between the municipal sector contribution and the minimum wage. If someone is working in a museum in Ontario, he or she is only worth the minimum wage, but if he or she is working at the Dairy Queen, that is the kind of private sector summer job that the Conservative Government feels should be supported and supported in spades.
I am frustrated, Mr. Speaker. I am frustrated because the Government was supposedly elected to consult. I hardly consider it consultation not have literally dozens of job programs plopped on my desk with six hours in which to analyse them and tell the Government to go ahead with them.
I say that the Government should rethink the Katimavik program. It was a program which clearly demonstrated-the Hon. Member shakes his head and laughs because it was a Liberal program. After all, no Liberal program could be a good program. Of necessity it had to be a bad program. Who on the Conservative side cares that 20,000 young Canadians had a chance to experience that program at a cost of only $10,000 per person? We would prefer to spend $38,000 to hire a couple of dog catchers in the City of Burlington and call that Conservative job creation.


Donald Alex Blenkarn: Burlington has a lot of dogs.


Sheila Maureen Copps: 1 am sure Burlington has a lot of dogs and a couple of them are elected here to the House of Commons.


Some Hon. Members:: Order!


Sheila Maureen Copps: I would suggest, Mr. Speaker, that if that type of interjection carries on, we are going to get more of the same.
There are people who are extremely concerned about the Government's direction and who believe that job creation is a little more than a $4 per hour job working as a clerk for the Oshawa group stacking grocery shelves or working at the Dairy Queen. If that is this Government's idea of a summer job creation program and a summer experience for young people, then I say that the Government is in very difficult straits because it does not understand that the young people want an opportunity to experience life and to have a chance to build for future careers. They want the kind of experience that was given to them through Katimavik and which has been denied by a Government that is so wedded to the credo of privatization that it is prepared to accept the Dairy Queen over Katimavik. I think that is a national disgrace.



PROCEEDINGS ON ADJOURNMENT MOTION

The Acting Speaker (Mr. Charest):: It is my duty, pursuant to Standing Order 46, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the Hon. Member for Prince Albert (Mr. Hovdebo)-Social Security-Processing of applications for Guaranteed Income Supplement. (b) Request for ministerial guarantee; the Hon. Member for York East (Mr. Redway)-Criminal Code- Bomb threat hoaxes-Request for stiffer penalties; the Hon. Member for York Centre (Mr. Kaplan)-The Disabled and the Handicapped-Effect of Budget measures. (b) Situation of the handicapped-Government position.



GOVERNMENT ORDERS


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The House resumed consideration of the motion of Mrs. McDougall that Bill C-99, An Act to provide borrowing authority, be read the second time and referred to a legislative committee, and the amendment of Mr. Deans (p. 11570).
Stanley J. Hovdebo: Mr. Speaker, I take this opportunity to expound further on the desire of the Government to sell the Budget and the borrowing Bill to the public of Canada. When the Government came to power, one of its promises was to do something about the tax system. It promised tax reform. There has not been one word in the Budget about tax reform, but the Government said that it would simplify the tax system and reduce the deficit, thereby reducing the need to borrow. If that tax reform had been brought in early in the life of this Government, then we would not have the great deficit that exists and we would not be debating the borrowing Bill.
If anything, the Budget increases the complexity of the tax system. 1 must say that it goes against the promises that Government Members made before they came to power. A simpler tax system has not appeared. It is no wonder that Government Members are trying to sell fairy tales about a simpler tax system, a deficit that is going away and an economy that is changing for the better.
Conservative Members promised a fair Budget and they are telling the world that they have a fair Budget. Fairness in taxation is, in the minds of most people, usually equated with progressive taxation. Perhaps we have to teach this lesson more often than we have in the past. Progressive taxation


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means that people who can afford to pay the most get taxed the most. It means that the higher the income, the larger percentage of it is paid in taxation. Rather than that, the Budget imposed more sales taxes, and sales taxes are regressive.
There is no difference between the amount paid in sales tax on a loaf of bread if one makes $1 million per year or is on welfare. We pay exactly the same amount of sales tax on any given item. The sales tax is a regressive tax. In both this Budget and the previous Budget, the Government increased the sales taxes, and that means that everyone has to pay it regardless of ability. The sales taxes and the excise taxes are paid equally by welfare recipients and millionaires, and that is a regressive tax. That is not a fair tax move.
Excise taxes are also regressive for the same reason. The rate at which those taxes are paid is the same for a person making very little money or a person making great deal of money. Income taxes are supposed to be progressive. Government Members are out there selling the fairy tale about equal taxes and fairer taxation. However, we realize that those in the higher income tax brackets will not have to pay as much. The best example of that would be the fact that a 3 per cent surtax was placed on everyone in the last Budget. At the end of the year the 5 per cent tax placed upon those with incomes of over $40,000 will be removed. The people in the $40,000 and over bracket will actually receive a reduction in the area of straight income tax because they will be required to pay the 3 per cent surtax rather than the 5 per cent. When the Government included the 5 per cent provision in the last Budget, it was a progressive movement, but it has been eliminated in the present Budget. Although many of the provisions do not appear to be regressive on the surface, they actually are. If one receives income from a source other than salary, one has the benefit of tax breaks which are not available to salary earners. Although it has been indicated that tax breaks are acceptable and worth while, the increase in the RRSP level and the capital gain for speculative increases are not progressive. In fact, they are regressive in the sense that they are breaks available to people who have the money with which to speculate and make money from that process, or to people who have income from dividends and are able to afford increased RRSPs. The middle-income person is quite happy if he can make use of the $5,000 which he can have in pension and in RRSPs, but he does not have money available to make use of the higher levels of RRSPs and does not receive that break.
We see a theme running through the two most recent Budgets, that if one makes more money, one pays less taxes. Unfortunately that theme appears in the Nielsen reports. The Government thinks that if its investments in services which should be available to Canadians do not have some return of money-and I am not referring to some return of service to the community or the people-it should not spend those funds. We find themes running through the task force reports which indicate that persons with the higher incomes pay the lower taxes; that if persons need services, they should pay for them;
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and if a service does not bring back something to the Treasury, it should be eliminated because it does not provide that return on the investment.
Earlier today I spoke about the Government being out there trying to sell a fairy tale about it having done so much for farmers. I went home last weekend and saw that the actions being taken by the Government are reducing the ability of farmers to continue to produce and to survive. Every necessary input cost faced by farmers who want to seed in the spring has been increased from at least 2 per cent to 5 per cent as a result of the taxes in the last Budget. The system being as it is, a 2 per cent taxation increase ends up being a considerably larger increase by the time it reaches consumers. That is the kind of theme which follows through the Budget and therefore suggests to me, as well as to the people of Canada, that perhaps the Government does not need the money it has and should improve the tax system so that it will receive more money for the effort it is making.
Mr. Len Hopkins (Renfrew-Nipissing-Pembroke):: Mr. Speaker, today we have before us another borrowing Bill. It contains at least three paragraphs and will cost the Canadian public $22.6 billion.
We have heard much about the so-called tremendous increase in employment which the Government has brought about. I should like to say a word about it because the Government uses figures which do not make sense. The Prime Minister (Mr. Mulroney) travels across the country and uses the figure of 580,000 for the number of new jobs created in Canada. At the same time there is a trend to part-time and temporary work, a trend which is increasing at a phenomenal rate. As was mentioned before in the House, Statistics Canada counts a person as employed if he or she works one hour or more in the target week of its survey. The increase in the employment figures includes those part-time jobs. When the Prime Minister stands in the House of Commons, travels across Canada, attends conventions in Montreal and brags about the 580,000 jobs created by his Government, he is talking about people who work one hour a week, two hours a week or half a dozen hours a week. To him that is the way Canadians should live. The definition of part-time employment as far as the Government and Statistics Canada are concerned is employment of one hour to 29 hours of work per week; that is their definition. The average hours worked per week by part-time workers amount to 14.8 hours. That brings in a tremendous income! I suppose it is the Conservative Government's idea of employed Canadians. Part-time employment has risen from 11.19 per cent of those employed in December, 1975, to approximately 20 per cent, as admitted by the Minister of Finance (Mr. Wilson) on February 7, 1986. For women there was a 27 per cent increase up to January 1986 in part-time employment. Approximately 18.4 per cent of all new employment since September 1984 has been part-time. That is what the Prime Minister is bragging about. Yet he stands up and tries to convince the Canadian public that he is creating full-time jobs.

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Temporary employment as defined by Statistics Canada is employment for less than six months. It can be part-time or full-time. It is distinct from permanent employment which is for a term of more than six months. Unfortunately, in its survey, Statistics Canada does not inquire whether a person is employed in permanent or temporary employment. Employment figures cannot be broken down to employment for two hours a week or 40 hours a week. You are in the same bag and you are all counted among the 580,000 figure about which the Prime Minister brags.
Statistics Canada produces unemployment figures for the Government. One day the Prime Minister stood in this House and used those figures. I went home and picked up the local paper to see that unemployment had increased dramatically. In my riding, the Government is paying people sums of money to quit work. It is called incentive retirement. Not only is the Government paying people to quit work, but the Government is doing away with a job every time it does that and that increases unemployment.
Parts of Canada are suffering from such cut-backs. Other parts of Canada are not experiencing those things and think we have the greatest thing since sliced bread. This is something which I cannot possibly find words to describe. The Minister of Energy, Mines and Resources (Miss Carney) has absolutely refused since May 23, 1985 to meet with a delegation of business people, municipal leaders, professional scientists and labour leaders from my riding who are very concerned about the cut-backs and the loss of jobs at Atomic Energy of Canada in Chalk River.
Sums of money are being offered to people to retire. They are being offered to people below 55, even those in their early fifties. Every time this is done, jobs are cut.
Here we are in this House talking about the progress of Canada at a time when the Government is cutting back on some of the finest technology Canada has ever had.
There is no better time than in a finance debate to talk about the contribution the Government is making to the field of national defence. We remember all those promises in the last election campaign. The Associate Minister of National Defence (Mr. Andre) came to my riding and said that the Government was going to increase the defence budget by 6 per cent in real terms, after inflation. Do you know what the Government has done, Mr. Speaker? It has not quite sunk in yet in people's minds, but the Government has kept its promises so well that in the present fiscal year it has not even met the rate of inflation. There is negative growth in the defence budget this year of minus 0.2 per cent.
We sat for days in the Standing Committee on External Affairs and National Defence. You would think there was no tomorrow because of the way the Conservative Members talked about all the wonderful things the Government was going to do for national defence. They even said that we should increase our budget up to the average of our European allies. Right now, Mr. Speaker, the Canadian dollar amount going
into defence is 2.1 per cent of our GDP. If we increase that to the level of some of our European allies, that budget would have to go up to 3.8 per cent of the GDP. Do you know what that would mean, Mr. Speaker? An increase of over $7 billion in the defence budget. How serious can you be? At a time when you have a total committee going gung-ho for that kind of an increase in defence expenditure, the Government comes up with less than the rate of inflation.
We have a frigate program to complete. We have an order for 138 fighter planes to complete, which are coming on stream well. We have 81,000 small arms coming on stream. We have 2,761 five-tonne trucks that have come on stream, all of which orders were signed by the previous Liberal Government.
What is going to happen to the low-level air defence systems? An article in Le Devoir this morning said that the system might be cut in half or pushed aside for a while. I mention all of this because this is the Government that for years condemned the Liberal Government for not carrying its weight in NATO.


Donald Alex Blenkarn: It didn't carry its weight.


Leonard Donald Hopkins: If that is all the math the Chairman of the Finance Committee knows, we should get a new chairman because he cannot add and subtract.


Donald Alex Blenkarn: You didn't carry your weight.


Leonard Donald Hopkins: In 1979 there was an agreement to increase the defence budget in real terms by 3 per cent on the part of all NATO countries. I tell the Chairman of the Finance Committee that in 1980-81 the increase was 3.2 per cent.


Donald Alex Blenkarn: Why didn't you do it before?


Leonard Donald Hopkins: In 1981-82 there was a 3.1 per cent real increase. In 1982-83 there was a 5.3 per cent real increase after inflation. In 1983-84 there was a 6.4 per cent real increase. In 1984-85, the last term for Liberal budgeting, the defence estimates increased by 8.9 per cent in real terms. In the first year of the Tory Government, defence spending growth in real terms was minus 0.2 per cent. The Chairman of the Finance Committee-


The Acting Speaker (Mr. Charest):: Order, please. I am very sorry to interrupt the Hon. Member but his time has now expired.


Nelson Andrew Riis: Mr. Speaker, I am very pleased to say a few words regarding the borrowing authority Bill which the Government is asking our permission to pass. The Government is asking us to borrow $22.6 billion, which is a considerable amount of money to borrow. It is the largest borrowing request ever brought before the Parliament of Canada at one particular time. It deserves fair consideration and a fair debate.
I have had the opportunity to spend the last number of days in my constituency. I had reaction from people of all political
March 17, 1986

persuasions, not of any one political persuasion. In fact, I have no idea of the political persuasion of most of the people with whom I spoke. People were asking a lot of very interesting questions. For example, I spoke at a number of college and high school gatherings. People asked what the Government has done to help young people find employment and pursue educational opportunities because they had not noticed any change for the better. As a matter of fact, there was a good deal of indication that matters had actually worsened in the preceding months.
The number of young people who are unable to find employment, to take training courses at community colleges, or afford university education, is actually growing in my constituency. Many young people now have a sense of hopelessness and feel that there is no point in continuing to look for work day after day because they have received no encouraging news and most of their colleagues have given up. They may find a job for two or three hours now and then in a fast-food outlet, but nothing permanent, and nothing like the kind of job young people should have to begin their careers and the establishment of a home and family.
I travelled to communities in my constituency including Falkland, Westwold, Sorrento, Notch Hill, and Silver Creek, which are in farming and cattle producing areas. The cattlemen and small farmers asked what there was in the last two Budgets which would be of assistance to them. They had not noticed any improvement. 1 said that there was a program to assist people to get out of agriculture, and there was perhaps some relief for those who were in financial crisis and happened to be doing business with the Farm Credit Corporation. However, there was no help for those doing business with traditional lending institutions.
By and large, Mr. Speaker, the situation in agriculture continues to worsen. The family farm is increasingly becoming a thing of the past. The maintenance of a family ranch, as they are known in my constituency in western Canada, is becoming more difficult with each passing month. The price of cattle continues to fall and the prices of other commodities are falling or remaining stable, while the costs of doing business continue to increase. This makes the future of agriculture extremely problematic and highly questionable as a viable way of life.
I visited a number of communities in the parts of my constituency which rely upon the forest industry. I visited Clearwater, Barriere, the North Shuswap area, Malakwa, and Sicamous. Those communities are harder pressed today than they have ever been. Levels of unemployment are higher than they have ever been. There is a sense of hopelessness. They thought that during the 1984 election campaign the Prime Minister (Mr. Mulroney) and others promised that there would be programs for reforestation, assistance in the modernization of mills, and many other programs to assist this hard-pressed forestry sector. All they have now is the threat of countervailing duties or quotas being imposed by the Ameri-
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cans, which will result in the closure of a number of sawmills in the interior of British Columbia.
By and large, the forest industry remains in an extremely depressed condition. No one with whom 1 spoke was aware of any initiative by the Government to alleviate these situations. They were aware of no improvement, only of a number of problems pending in the future. We are now under the real threat of the United States imposing a countervailing duty on our exports to the United States.
I went on to visit a number of tourist operations. These people are waiting for Expo 86 and the bonanza which will occur in their operations, whether they run small marinas, motels, hotels, camp grounds, or fishing camps. These people are simply hoping that things will improve. There is very little concrete evidence to indicate that life for the hospitality industry will become any better than it is today in its present deteriorating situation.
One could talk about mining, but there is no point in it because, in a sense, mining in western Canada has ceased to exist. The future looks anything but bright for those mines which continue to exist, be they in the coal sector or the copper molybdenum sector, which makes up about 70 per cent of mining in British Columbia. There are a number of reasons why one would expect new initiatives by the federal Government to encourage activity, particularly for small mining operations. There is almost a feeling of hopelessness with regard to the mining sector.
One could talk about the small business sector and the small and medium-sized manufacturers. However, the Government has done very little to encourage these sectors. There have, instead, been increased interest rates, increased fuel costs and expensive costs of doing business. Quite frankly, lending institutions are very reluctant to lend money to small businesses, particularly in the service sector, unless they are prepared to put up huge amounts of collateral. Even then, it is very difficult indeed.
I think it is fair to say that the Government has done virtually nothing for the cattle industry, the farming industry, the tourism industry, the fishing industry, young people, the small business sector, small manufacturers, those in the service sector, and native communities hoping to laungh economic endeavours. The initiatives taken by the Government are either non-existent or minor.
Before the change of Government there was a outcry about Section 31 of the Income Tax Act which differentiates between a bona fide food producer and a part-time, or hobby, farmer. The assumption during the campaign was that this would be cleared up very quickly. It still has not been cleared up. There has been no indication that this section of the Income Tax Act will be changed to encourage small ranchers or small farmers to expand their businesses.
Let me say in conclusion that, having just completed a major tour of my constituency, I found that people are puzzled, when they hear that the Government has done good things for various groups, by the fact that no sector of the

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economy with which they are familiar is able to determine what good things have happened to it. I suggest that the Government has used myth, smoke, and mirrors with regard to assisting various sectors of the economy in various communities of Canada.
The people of Kamloops-Shuswap are asking the Government to take some special action in recognition of the fact that the economies of British Columbia are especially hard hit and are having problems. Just as the Government recognized that there are special difficulties in Atlantic Canada and took special initiatives there, the people of my constituency ask that such initiatives be taken in western Canada.
[ Translation]


Robert Phillip Kaplan: Mr. Speaker, we now have before us an amendment by which it is propose to postpone for six months consideration of this legislation. I rise both on the amendment and on the Bill itself.
Mr. Speaker, this is borrowing authority legislation and the Government is now trying to seek authority to borrow $22.6 billion, which is a lot of money, and in examining the Bill, two other things must also be considered. On the one hand, with its Budget the Government is borrowing here, levying taxes there, and also slashing its programs because the Government has decided to do its housecleaning in those three directions. Looking at those three directions, those three aspects, one will appreciate the reason why the Official Opposition is raising such strong objections. We oppose this Government's housecleaning operation because it puts an increasingly heavy load on middle-income people and on the most in need.
Mr. Speaker, I would like Canadians to look at the previous Government's history of tax measures and programs, as against this Government's own attempts at setting programs and housecleaning. Everybody knows that when there is economic growth, as is the case today, it is the right time to arrange to pay for the social programs we have in this country. Canadians are well aware that social programs are not free, that they are expensive and must be paid for, and this is the time to take steps to pay for them when we have economic growth. Under whatever Government, Conservative or Liberal, program costs must be paid, but the difference between a Tory and a Liberal Government is, who shoulders the burden of paying for the programs. After two Tory Government Budgets, we can clearly see that the rich are paying increasingly less, and in the future, with the Budget now before us, they are going to pay increasingly less, while lower income people, the poor, are going to pay more.


David Kilgour: That is not true.


Robert Phillip Kaplan: There is now an interjection by my colleague for Edmonton-Strathcona, and I am quite happy that he is interested in what I have to say. But I would suggest to him and to any other interested Canadian that if they look at the rate of increase or change in the tax burden borne by Canadians, during the 20 years previous to September 1984, they will see that an increasing share of the burden was transferred
from the shoulders of the most in need to those of other groups of Canadians, middle-income Canadians and the most affluent. Gradually, the burden was taken from the shoulders of the poor and transferred to other Canadians. It can be said that what we experienced during the 20 years previous to September, 1984, was a shifting of the tax burden to those who could pay. This situation has changed since the last election, and the direction is now for the poor to pay more. One thing is clear: it is the de-indexing process that was initiated by our leader, the Leader of the Official Opposition and the then Minister of Finance. All this has been changed by the last two Budgets, and put an end to the process whereby Canadians obtained some measure of relief from the effects of inflation through the tax system. Now the poor are going to pay more, including income tax, and we are opposed to that, and that is one of the reasons behind our amendment.
Mr. Speaker, I also want to talk about sales tax and what the present Government thought of it before they came to power. They were always very vehement about the fact that sales tax is a regressive tax and has a greater impact on middle and low-income Canadians. The impact is greater because these groups have to spend the greater part of their income. Canadians who are better off can afford to save and invest and travel abroad. Middle and low-income Canadians cannot and must spend the majority of their income. By raising the sales tax from 9 to 12 per cent, the Government has put a heavy burden on poor and middle-income Canadians. We object to that.
We believe that even if this is the price we have to pay for social programs, the Government is being too hasty and it is not the right time for such high tax increases, especially those that affect people on middle and low-incomes.
I could quote a host of press articles and commentaries, all of which argue it is not the right time to introduce such substantial taxation. Yes, it is time to deal with the deficit. Yes, we know it is not fair and not feasible to have social programs without paying for them but if this means that middle and low-income Canadians must suffer, Liberals see this as as unfair and unacceptable. The timing of this measure will not be acceptable to the market and may affect our economic growth. It may take away money the economy needs.
Mr. Speaker, if the Liberals are drawing out the debate, if on the basis of our responsibilities in this House, we have decided to delay the vote, it is because we want to draw the Government's attention and that of Canadians to what is wrong with this Government's policy. I am looking forward to the day before the next election when we will be able to give Canadians a survey of this Government's tax policies since the election. We will see increased taxes for middle and low-income Canadians and tax reductions for the rich in our society. And we will then see how the situation under this Conservative Government compares with the past, when the tax burden on middle and low-income Canadians was reduced on removed altogether.
March 17, 1986


Michael Morris Cassidy: Mr. Speaker, 1 would like to take part again in the debate on the sixth-month hoist motion on Bill C-99 entitled an Act to provide borrowing authority.
Mr. Speaker, 1 would like to remind you that authority is being sought under this Bill to borrow $22.6 billion, an amount equivalent to the total deficit, to be borrowed during the fiscal year 1986-87.
When 1 spoke on this issue earlier today, Mr. Speaker, 1 commented on the fact that, regardless of the many recommendations of the Nielsen Report, the Task Force on Program Review, nobody has really dealt with tax expenditures, particularly those which benefit large corporations in this country.
Mr. Speaker, that was my starting point because if the Government really wants to justify its expenditures we must review all of them, not only selected expenditures and particularly those related to social programs.
Mr. Speaker, we are amazed to find out that the Task Force did not examine the expenditures of the Treasury Board, nor those of the Privy Council. They did not examine the expenditures of the Department of External Affairs, nor those of the Department of National Defence. In other words, some of the major public expenditures have been ignored, but at the same time they focused on private sector subsidies and social measures.
Some of the studies may have dealt with tax expenditures, Mr. Speaker, but no major changes have been recommended.
I would refer to the remarks of the study on services and subsidies to business, page 97 of the English version: This study group does not recommend significant changes to the four tax expenditures related to corporate income.
Mr. Speaker, instead of looking for ways to save some of the money now spent in the form of tax expenditures, the study groups ignored this source of financing.
At the same time, Mr. Speaker, they criticized existing programs, saying that we give very generously to the major companies. In spite of that we are not doing anything to make sure we will be far less generous with those major companies.
As I was saying in English earlier today, Mr. Speaker, if the Government is really serious about reducing the deficit, it will be dead serious about both tax expenses and Government spending.
I notice that instead of reducing the tax expenses, it has increased them since it came to power in September 1984. For instance, there is the lifetime $500,000 capital gains tax exemption for single taxpayers, $1 million capital gains tax exemption for a man and his wife who benefit from the advice of a financial consultant. This family could avoid paying taxes on $1 million in capital gains while a family with a $30,000 yearly income would have to pay between $150,000 and $200,000 in taxes at the current rate over a 30 year period.
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Mr. Speaker, my question is this: Is it fair for affluent people to benefit from such a tax break ranging between $150,000 and $200,000? It is not, Mr. Speaker, absolutely not.
There are other examples, Mr. Speaker. For instance, the oil industry is getting a tax break of up $3 billion a year. Because this tax break has contributed to the deficit by reducing the Government's receipts, it has affected all of us. That is why tax revenues from major corporations will increase only by a small margin, while taxes paid by individuals will increase by 15 or 17 per cent during fiscal year 1986-87.
Mr. Speaker, the Government has set up a discriminatory system, because it favours major corporations at the expense of ordinary people.

When you have tax expenditures, and they have been identified by the study groups as being a serious problem, when the study groups suggest that the programs of subsidies and tax expenditures for business amount to giving with both hands and are making business into a group of program junkies, it is very hard to say why the study group will then conclude, as they do on page 97 as follows:
-the study team does not suggest significant changes relative to the four corporate income tax expenditure items covered by this overview.
Those four are the investment tax credit, the accelerated depreciation, the mining tax credit and the reduced rate of tax on manufacturing. They do not suggest any change.
The rationale in many cases is not adequately spelled out. In many cases they say, "Well, these are things at which we are going to have to look at some later time". The recommendations for people on the Staff Relations Board and many other parts of Government to be fired are taking effect right now. As my friend from Prince Albert pointed out, there were cutbacks taking place in terms of program delivery in regional offices in the east and west end of the region of Metropolitan Toronto where offices are actually being shut down.
Those are real cuts. It seems to me to be grossly unfair, if the Government is concerned about efficiency and effectiveness in Government spending, as we certainly are on the side of the New Democratic Party, that it should be so lenient when it comes to spending by large corporations at the same time that it is so rigid in going after much smaller quotients of expenditure by individuals and by small business.
All of the evidence suggests that the task force bought the bias of the Government in terms of what it felt should be done relative to tax incentives as compared to the kind of incentives that can be given by grants. It said on page 19, and I quote:
On policy, the team is in general agreement with expressed Government preferences for non-interventionist (i.e., tax) assistance, for setting a better business climate through removal of impediments to growth, and for concentrating federal assistance on the classic public goods of better information and service to the small business community.
In other words, the task force was biased against the grant programs that in many cases provided a much better modicum of public assistance to the Atlantic provinces, to northern Quebec and to Gaspe, to depressed regions now in parts of British Columbia and Alberta. It was against those kinds of

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things and in favour of tax assistance, which had the effect of helping companies in southern Ontario, in the region around Montreal, and in particular companies which are already making a profit and therefore are in a position to be able to benefit from tax expenditures.
We have said again and again that we feared that the Nielsen task force review would, in fact, enunciate a Conservative blueprint. It would come along and simply mirror what the Government would have a chance to say if it had the time to work it all out. That is effectively what has happened.
I accept that there are some things that make some sense in the report. They point out, for example, that when you are looking at a new economic activity which is created by Government grants you should also look at the fact that those grants have to be paid for by Canadians and may be affecting economic activity elsewhere.
If you are going to make that point you should also make the point, when you take dollars from ordinary Canadians and put them in the pockets of big businesses, allegedly to make them more competitive, that neither your task force nor the Department of Finance has any means of knowing and has not the least idea of whether or not these tax expenditures are effective I think that deserves looking at as well. We have the right to know whether or not these various expenditures are effective.
I note that in 1977, 1 per cent of the largest corporations got 64 per cent of corporate tax breaks. By 1981, that had risen to 72 per cent of the corporate tax breaks that went to 1 per cent of the largest corporations in Canada. I am sure there is no reason why that has changed since 1981, since we have had "Visa" and "MasterCard", two Governments that are essentially in agreement, although a lot of the essentials benefit the corporate sector in Canada.
Why was it that the study groups in the Nielsen task force did not look at that? Why did they not ask themselves whether a part of those tens of billions of dollars of tax benefits going to big business might be taken away? Of course, big business would say that that would be a tax increase, but all it would be would be a restoration of taxation which it has been forgiven for many years. There is no hope of getting the money back which was given in the past, but if we are talking about bringing the deficit down to a more livable level and giving Government more freedom to maintain vital social services, such as the support of universities and other things which are of particular importance to the regions, surely, then, these things should have been looked at. I am afraid that neither the Nielsen task force, nor the Government, has had the intellectual rigour or political courage to confront its adversaries, its friends in the corporate sector, and say: "We are sorry, boys and girls, but we are going to have to do this to you". That should have been done, and if it had been, it would have made us much more comfortable in terms of the whole deficit-cutting exercise.


Russell Gregoire MacLellan: Mr. Speaker, I would like to continue where I left off this morning with respect to Bill C-99, the borrowing Bill. As I said then, I really do not feel we can trust this Government with another $22 billion when it cannot even tell us exactly what the average price of crude oil will be for 1986 in U.S. dollars. Page 23 of the booklet Towards a Sustained Expansion: Canada Economic Prospects, 1986-1991, states, and 1 quote:
-that the average selling price for a barrel of oil of quality equivalent to Saudi Arabian light will be U.S. $22.50 over the rest of 1986.
On page 20, Table 4, "International Economic Prospects", under the column "1986", states under "Oil Price" that Saudi Arabian price for light crude oil petroleum will be $23.88 a barrel. So the Government cannot even tell us what the price will be. Not only that, but it is saying in one case that the $23.80 will be the average price for all of 1986, yet the $22.50 will just be the average price from the date of the Budget to the end of 1986. So not only do we have two different prices, but we have two different time spans during which these prices are supposed to be the average. In either case, we are going to need oil prices at either $22.50 or $23.88 in order to bring down the average price to the amount stated, because oil prices throughout the world have been down to around $12 or $13 a barrel for most of the first quarter of 1986, certainly around the $15 a barrel level. Therefore, these figures are way out of whack and this, along with the 9.5 per cent interest rate for an average in 1986, indicates that the Government has greatly underestimated what this deficit is going to be.
The Government certainly has not told us-perhaps because it is not capable of getting its act together economically- exactly what we are up against in 1986. It is an extremely serious situation because the energy sector is predicting prices as low as $8 U.S. a barrel. This $8 U.S. a barrel in comparison with the projections in the budget papers, particularly the book, from which I quoted earlier, Towards a Sustained Expansion: Canada's Economic Prospects, plus the fact that interest rates could very easily be 3 per cent on average over what has been projected, could mean a difference of about $4 billion over what the Government is predicting for the deficit.
Only the Government seems to believe the figures it has given as to what oil prices will be in 1986. What do other people think of the Government's finesse with numbers? Robert Reid, an oil industry analyst for McLeod, Young, Weir Limited, says: "Wilson's oil prices are wishful thinking". Gint Berius, an analyst for Merrill Lynch, says: "The unrealistic prediction about oil prices is probably one reason why the Canadian dollar has slipped on international markets". Don Braid, a columnist with the Edmonton Journal, says: "The Finance Minister has based his Budget on an oil fantasy".
What is happening in the oil industry? While the Government lives in a fantasy world with a Budget based on blarney, you might say, the oil industry in Canada is facing a disaster. Seven oil companies have announced lay-offs or staff cut-backs which total about 1,500 jobs. IPSCO, a steel pipemaker for the oil industry, will itself eliminate 695 jobs.
March 17, 1986

Don Herring of the Canadian Association of Oil Well Drilling Contractors says that 4,000 jobs will vanish this spring and he believes the worst is yet to come. Dale Tufts, President of the Petroleum Services Association, says that the total job losses this year will reach 6,000 and could go as high as 15,000. One government official in Alberta says: "There is fear in the streets. Every major oil project is threatened". The Government says the average price for crude oil will be $22.50 on one page of its booklet and $23.88 on another page. So, obviously, either the Government is right and the world is wrong, or vice-versa.
The Government says there is no need to worry. In spite of its attempts to calm the nerves of the energy sector and the country, we are worried a great deal about the catastrophe to which the Government could be sending the country economically. Can we honestly give the Government another $22 billion in view of the fact it is completely off base in what it says in the Budget and what it says it is going to do?
What about the East Coast? What about the promise of jobs there? Even Premier Buchanan of Nova Scotia has finally admitted there is some reason for concern. He even went so far as to admit that an $8 a barrel price would be a very severe blow to the East Coast. He ignores the fact, of course, that Petro-Canada is ready to abandon five wells on the East Coast, and Husky-Bow Valley-thanks to the reneging of a commitment by the Government-has dropped three wells from its modified drilling program. At the request of the Government, it had already dropped three wells from its original forecast. So it has dropped six wells from its drilling program because the Government is in fact implementing regulations under the Petroleum Incentives Program Act with respect to Bill C-85, and doing it retroactively.
It is not the industry we have to look at because it is leading a downturn in activity and exploration. It is the Government which is panicking and causing the uncertainty about the oil and gas sector in Canada. What does the reality of a lower oil price mean to Government revenues? Every one dollar drop in the price of oil means at least a $100 million loss in revenues to the Government. Instead of going to Washington, perhaps the Prime Minister (Mr. Mulroney) should go to Ireland and kiss the blarney stone because with figures like this, he certainly is going to need all of the good luck he can possibly get. Only a complete turn-around from what is perceived by the industry and by the economists at the present time can save the Government's Budget from leading this country into a very serious economic crisis. But that is just in the energy sector.
What has the Government done in other sectors? The net taxes will increase by $1.5 billion while net spending will fall by $800 million. The extra $1.5 billion in taxes means an average of $145 for each household. Canadians earning less than $15,000 a year will receive a sales tax rebate of $50 per adult and $25 per child. Corporations will pay a 3 per cent sales tax in 1987. Basic tax rates for corporations, manufacturers and small businesses will be reduced as of January 1, 1987.
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What the Government has done on St. Patrick's Day is to emphasize the "sham" in shamrock.


Donald Alex Blenkarn: We've got blarney coming from you!


Russell Gregoire MacLellan: The sham goes very deeply into the economic forecasts and the economic thinking of the Government.
What is this Government doing for the areas of the country where regional disparity is such a tremendous problem? It is doing very little. It is hiding. It is saying that it will bring forward these programs which have no bearing whatsoever on the real problems of Atlantic Canada and other areas undergoing regional disparity. In fact, what it does is to put the areas undergoing regional disparity in a Catch-22 situation by saying that any economic upward mobility has to be through the private sector. Yet it stacks the deck against the private sector so that it cannot possibly make use of this avenue to increase expectations.
It is a gloomy Budget which presents a gloomy picture to Canadians. I hope it is not the case in reality. It certainly gives little hope because the Government does not seem to know what it is it wants to do.


The Acting Speaker (Mr. Charest):: Resuming debate, the Hon. Member for Windsor-Walkerville (Mr. McCurdy).


Arnold John Malone: He has already spoken.


John Barry Turner: We want to go out and
enjoy ourselves.


Some Hon. Members:: Question.


Howard Douglas McCurdy: Mr. Speaker, we are listening to parliamentarians who are supposedly more experienced than I. They should know that I can speak to the amendment. I would ask them to search their memories in order to see that they are quite incorrect to suggest that 1 cannot rise to speak again.
I was really intrigued-in fact, I was taken aback to some degree-when I initially heard the word "blarney" issuing from the mouth of my colleague in reference to the Government. I could not quite understand how that was possible. However, I then realized that this is St. Patrick's Day and blarney does come to mind. In his lighter moments I suppose the Prime Minister (Mr. Mulroney) exhibits some elements of what could be characterized as blarney. As I understand it, blarney is a type of good-natured circumlocution which, of course, characterizes the Prime Minister. Blarney is characterized by some good-natured colouring of what is being said in order to make people feel good, perhaps even better than they ought to feel in the circumstances. The Prime Minister has done that. Indeed, I think that even the most committed Irishman would have to admit that blarney is occasionally characterized by slight untruths but that those untruths are intended to make people feel good about their circumstances and about the person uttering the blarney. That, too, characterizes the Prime Minister. In fact we have heard something more than blarney from the Prime Minister, especially when

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he mentions sacred trusts. Then he steps on the people of the country in a most objectionable way and destroys their hopes. It is more than blarney when the Prime Minister says that we will double expenditures on research and development and then fails to do any such thing. In fact he has cut back on the rate of expenditures for such research and development. That is more than blarney; it is an untruth.
No, the Government is not characterized by blarney. It is characterized by an utter failure to live up to its promises. More important, it is characterized by its failure to live up to the needs of the country in terms of its Budgets and policies. I see Hon. Members opposite smiling in good humour. They recognize the truth.
I was reflecting on the speech given by my colleague, the Hon. Member for Hamilton Mountain (Mr. Deans), in which he cited the many instances in which Members opposite took positions on both sides of the question when they were in opposition. Of course, that indicates the perfidy of members of the Tory Party. I began to think about that and I realized that it is not necessarily so. It might be an immoral approach to politics, but it might also represent the fact that whatever the government policy may be now there may well exist within the Party opposite sufficient diversity of opinion and sufficient opposition to stupidity that they may be listening to what we have to say. Perhaps Members opposite would like to hear a case presented in such a fashion as to encourage them to combat some of the errors being made by the Government.
I have only a few minutes in which to pursue this discourse.
I suppose it should be pointed out that it is my tendency when asked to speak in such circumstances to relate my remarks to the four major issues which constitute my critic area. They are youth, post-secondary education, science and technology and human rights external. As I have indicated before there is within these areas a relationship in terms of the policies generated with respect to them and to the future of the country. It bears emphasis that in recent weeks there has been an emphasis on the concerns of youth through unfortunate circumstances. I have to say that I find that what the Government is not doing as opposed to what it is saying is deeply offensive.
I can understand that the Secretary of State (Mr. Bouchard), the Minister of State for Youth (Mrs. Champagne) and the Prime Minister may see within the demonstration by the good Senator some type of offence to the parliamentary process. That is understandable. However, what we have heard is something more than that. We have heard the Secretary of State utter remarks which are only consistent with the notion that the Government will refuse to act in response to the strongly articulated needs of youth simply because there is a Senator in the lobby of the Senate engaged in a hunger strike. We can say, as we have said before, that there is something sick loose in the world when 700,000 young people are unemployed. Many of them are the prostitutes off our streets. Many of them are without food and meet in the missions of this country. Many are driven to crime. Many are alienated to the point of never being able to return to society. There is a need
that cries out with a tearful voice and a relentless voice. That all of that would fail to get a response would certainly indicate that the Government, under no circumstances, will respond to what could potentially be the death of one man who is demonstrating concern. Why would the Government refuse to act in a responsible fashion simply because this dramatic demonstration is occurring?
We have heard the Prime Minister rise in the House to promise that there would be some action taken with respect to the development of youth programs in addition to the many things he claims to have already done. We heard the Minister of State for Youth say that she had read the New Democratic task force report and the Senate committee report and is working on a program that will be implemented pretty soon. Then we heard the Secretary of State say last Friday: "Oh, God, I don't know anything about it. As far as I know, we are not going to have any programs for youth".
The perfidy, the prevarication and the misleading exercise this Government is taking, along with its failure to respond represents a poor model for anyone but, most of all, a poor model for our youth. The Budget constitutes a traitorous response to the needs of so many young Canadians, and that should change and change fast.
[ Translation]


The Acting Speaker (Mr. Charest):: Debate. The Hon. Member for Jonquiere (Mr. Blackburn).


Mr. Jean-Pierre Blackburn (Jonquiere):: Mr. Speaker, I had not planned on speaking in this debate on Bill C-99 asking for a borrowing authority of $22.6 billion, but I cannot remain silent when I hear the comments made by the Members of the Opposition. Indeed, I find it very unfortunate that some Members opposite would attempt to project such a negative and irresponsible image to the population even though our Budget shows a lot of imagination and coherence in view of the financial situation which we inherited, as well as sensitivity to the problems of the most needy among us.
It would be very easy to do like the previous Government and increase our expenditures. We could also increase the size of the Public Service and the number of Crown corporations. We could reduce taxes and increase family allowances and old age security pensions. In the short term, this would certainly please Canadians, but we would be on our way to a financial deadend.
Instead, our Government has opted for a reduction of its expenditures and asked Canadians to make another effort to put our economy back on its feet as soon as possible. Mr. Speaker, this is truly a responsible Government.
We are keeping to the two objectives which we set ourselves as a Government and as good administrators. The first is to fight against the deficit, as we are continuing to do, and the second is to encourage business investments as its direct result
March 17, 1986

is to create employment. A short while ago, the Hon. Member for Vancouver Quadra, the Leader of the Opposition (Mr. Turner), said this: "You do not have to be a genius to increase taxes". Mr. Speaker, the man who said that was once Minister of Finance. He is the father of the Canadian deficit. He gave the Government a deficit of $56 million within 43 months. This is what he did. For our part, we took over a Government with an accumulated deficit of $200 billion which still increases by $35 billion to $40 billion a year. With a 10 per cent interest rate, we would reach $100 billion in 20 years if this were to keep up, 1 repeat that, with an interest rate of 10 per cent, we would be paying $100 billion in interest each year. However, we now have a budget of about $116 billion. This means that nearly all the budget would be needed to pay the interest on the debt. That would be ridiculous and we could not accept it.
For the benefit of the Canadian public, I would like to quote a few comments of the Institute of Chartered Accountants, who said in December 1985: "Discussions on the deficit are disconcerting and the facts are not encouraging. In 1983, the International Monetary Fund stated that in relation to the size of its economy, Canada had the largest deficit of the seven industrial powers of the Western World. An increasingly huge drain of federal Government funds is the price to be paid for servicing the public debt resulting from deficit accumulation."
And they added, concerning public reaction: "Whatever theorists may say, whether in support of or in opposition to serious government deficits, it is undeniable that the general public is concerned with the federal Government deficit. This was shown by a survey made in 1983 by Decima Research Limited. As was shown by that survey, the public feels that when times are hard, the government should restrain its expenditures and manage its finances as prudently as any average Canadian family. Although such a household view of the economy may not be very subtle, it shows deep interest in the country's economy and its impact upon present and future generations. It now seems clear that aside from all considerations, government deficits are a cause of concern to the people. Such concern indeed is undermining public confidence in the economic and political institutions and, in the long run, will no doubt affect this country's economic yield.
Mr. Speaker, it was so serious that Mr. Kenneth Dye stated: "The deficit for fiscal year 1982-83 in the case of the Liberal government showed a $5.3 billion underestimation." This means they literally hid the deficit at that stage.
Well, Mr. Speaker, I believe we have a Budget that is both responsible and realistic. It is realistic because it reflects the disastrous economic and financial situation we have inherited. Because, among other things, we are sticking to our goal of reducing that deficit by some $4 billion a year, from the original $38.2 billion to $33.8 billion this year, and in our projections to $29.8 billion.
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Why is this also a responsible Budget, Mr. Speaker? Because it is directed to job creation. And in that area, there is tremendous confidence in the small and medium-sized businesses. We brought the taxation rate back from 15 to 13 per cent, and we put our trust in private enterprise. There are
700,000	small and medium sized businesses in this country, and they generate most of the jobs.
Also, we help the most in need in our society with our $300 tax credit per child, per family. This is another measure that will enable families most in need to manage more easily through these difficult times.
Also, our Government is injecting $300 million in research and development.
There are also employment programs for social welfare recipients. For the first time, our Government is earmarking $100 million for the poorest people in our community.
We are also helping the cultural sector with $75 million.
Now, that is a set of measures that will enable the poorest Canadians to meet their needs while creating additional jobs. Our performance in a year is rather impressive. We have created 585,000 jobs and have reduced the unemployment rate to 9.8 per cent which is a creditable performance even if the effort must be carried further.
Our first year is a token of confidence and success which Canadians should continue to take into consideration.
Our inflation rate has also been controlled at 4 per cent which is also another very good performance which should be maintained.
Mr. Speaker, I would also like to refer to the comments made this morning by the Hon. Member for Windsor who said that we were not sticking to our commitments. 1 am rather surprised to see the Members opposite trying to lecture us.
I remember a few years ago and, no doubt, you do also remember, Mr. Speaker, an election campaign during which the then Liberal Government had bragged throughout the country that they would never freeze salaries. You remember it because we heard about it for so long. However, once elected a few months later the Government did freeze wages and salaries. Therefore, I think that before lecturing others they should consider what they have said and done.
Mr. Speaker, we told Canadians that we wanted to restore the health of the economy, reduce the deficit and create jobs. This is the policy we are maintaining, and I believe our results have been excellent so far.


Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, it is an interesting challenge to talk to the borrowing Bill, Bill C-99, because it is really a statement on the philosophy and policy of the Conservative Government in respect of where it believes

March 17, 1986
Borrowing Authority Act
the country should go. The Government has every right to state it that way, and I think we in the Official Opposition have the obligation to raise our concerns about the direction in which the Government is going.
Let us look at the results of the last two Budgets. Canadians have been inundated with tax charges on an individual basis. It is not a very pretty picture. Not unlike the May Budget in which the Government introduced a borrowing authority Bill requesting $18 billion, this time it is asking for an additional $22.6 billion for the 1986-87 year. I see an unfair allocation of funds in the borrowing Bill induced by the Government's lack of policy direction and its buckling to the dictates of Bay Street and Wall Street which forecast for it the need to decrease the deficit.
In the Budget, the Prime Minister (Mr. Mulroney) and the Minister of Finance (Mr. Wilson) claim that they can reduce the deficit below the $30 billion level. However, it will be quite some time before we see what really happens. Canadians will have to wait until next October for proof that the deficit has been reduced even to the $33.8 billion which the Minister of Finance forecast for the current fiscal year ending March 31. It is not until then that public accounts, which give the final deficit figure for the previous year, are available. Canadians will then have to wait another 12 months, bringing us to the fall of 1987, before they will learn whether or not the deficit really comes in below the $30 billion mark. So far the public really has estimated forecasts of what the tax increases and spending cuts might bring about. I stress the word "might" because the end result which will be provided is not a definite one. We may be looking at a lot of wishful thinking. If it is brought in this way, all the better, but it should not be on the backs of poor people or those who are in need.
Federal forecasts are just suggestions. There is no sure thing, and we do not know what will intervene. For example, we do not know-and hopefully we will never have to live through it-whether there will be another bank fiasco out West, which would add an unexpected $800 million or $1.5 billion to our spending estimates, therefore requiring us to borrow more funds. I suggest that we should not count our chickens before the eggs are hatched.
The public has some sense of suspicion right now as to the ability of the Government to determine exactly where it is going. We must wait to see if the deficit will go below the $30 billion mark. In the meantime, while politicians play "guess the deficit", average Canadians can only hope they are not too badly marred by political strategy as they attempt to pass "Go" and collect $200 if their jobs are still available. At the same time, a limited number of corporate Canadians, those who have a better chance of passing "Go" and making money from their hotel property investments, receive a better tax break.
The 3 per cent corporate surtax will be applied on a lower tax base. For example, it drops from 36 per cent to 33 per cent in the next three years for certain levels of income or profits from corporations. The theory of corporate tax breaks is that profits will be reinvested and will create jobs. Will businesses
expand knowing full well that Canadians will not have the disposable dollars which they had before and will not run out to spend money on the purchase of their products? It is a good question, one which is causing all of us some concern.
When the Minister of Finance brought down his last Budget, he described it as the "most significant and far-reaching program of expenditure control over undertaken by a Government in Canada".


John Barry Turner: Hear, hear!


Sheila Finestone: That is fine, but let me indicate that it is significant. I would consider a Budget which taxes its way out of a deficit by attacking middle and low-income Canadians as significant and certainly something to note at election time. "Far-reaching" is another good adjective to describe the Budget since most of us will be reaching far into our pockets to accommodate the extended tax measures provided in the Budget. Of course, for a small fee, found in the form of increased interest rates, banks and loan companies will be happy to loosen money from our pocket-books for us and to ease our whitened knuckles.
It would be hard for Canadians not to understand from the Budget that the big bucks required to knock down the deficit and cut the Government's annual borrowing authority in half by 1990 will come from taxes on individuals. Again the middle class has been hit. Average people such as the ones in my riding of Mount Royal will not find life to be as smooth as it was before. Average Canadians will continue to be squeezed for more tax revenues. Ordinary Canadians who hoped that Government spending cuts would ease the burden of the national debt were disappointed when the Minister of Finance announced his method of deficit reduction by way of personal income tax increases from $38 billion to $44.7 billion in 1985-86, up to $49.3 billion in 1986-87, and to a record high of $54.8 billion in 1987-88. Most of us cannot even think of the number of zeros involved in those figures. Most of us deal in pennies, nickels and dimes; maybe in dollar bills. We are looking at an over-all 44 per cent personal income tax increase which has been incurred in the 18 months the Conservatives have been in power. It is the largest increase in personal taxes going as far back as we can go in history.
One of my concerns is about the way the Government has been attacking the 4.5 million people who live below the poverty line. There were measures in the last two Budgets which push our poor people right into the ground. Where is the balance which is supposed to be maintained between the rich and the poor? Personal taxes have been deindexed. Unemployment insurance for Canadians taking early retirement has been cut back. We have seen the distress, unhappiness and serious financial implications of some of these moves.
Some of us in the House met with the earlier retirees who were in Ottawa last week. Some of them were in their late forties and early fifties and still had major responsibilities in terms of raising their families. They took early retirement, anticipating that with the money they had paid into the unemployment insurance they would have an opportunity to go
March 17, 1986

out with some support measures, be able to look for another job and thereby assure the well-being of their family over the interim period. That is not what happened, Mr. Speaker. We heard a lot about the suffering and the disaccommodation by the Government taking such a retrogressive step.
Last week's Budget reports an increase of $1.9 billion in taxes, with $1.5 billion of this amount being placed on individuals while only $380 million will be placed on corporations. Do you call that justice when $1.5 billion in placed on individuals and only $380 million is placed on corporations?
Last year's Mulroney-Wilson Budget reported tax cuts for companies but increases for individuals of $1 billion for the coming fiscal year, 1986-87. The combined Budgets provide a personal tax increase of nearly $30 billion for the years 1985-86 to 1990-91 inclusive, while corporate tax increases for the same period will amount to just over $6 billion. Is it fair to have a personal tax increase of $30 billion while the corporate tax increase will be only $6 billion? In other words, personal tax increases will be five times as much as corporate tax increases. Can the Minister of finance explain why those at the lower end of the income spectrum are facing taxes higher than those sitting comfortably on the top? Can he explain in particular while those earning $40,000 are expected to absorb from 1985 to 1987 a tax increase of 9.4 per cent while those earning $150,000 get a tax decrease of $1.4 per cent? What kind of nonsense is this? Canadians do not find this fair.
I object to this borrowing Bill.


Roland de Corneille: Mr. Speaker, I rise once again on this Bill, this time on the amendment. I have expressed my deep disappointment with the policies of the Government for which it is asking us, in three short paragraphs on one page, to ante up $22.6 billion in order to carry out policies with which the Canadian people have become disenchanted.
My concern right now is for the young people of this country, a very large number of whom are unemployed and can only look ahead to being a generation being passed by.
I am very disappointed, as are most Canadians, with the repetitious replies given by Members on the Government benches when asked and challenged about the tragic unemployment situation. The Conservatives cites statistics to show that they have improved the situation very much in the past year. Indeed, the statistics may suggest that the situation has improved, and well it should, but what the Conservatives fail to mention is that their unemployment figures are still well above what they were before the recession came about.
The level of jobs that existed before the recession came has not yet been achieved. Instead of talking about how much they have done in the last while under circumstances of huge, burgeoning stock market results in the United States and the very healthy economy throughout the world instead of boasting about employment, the Government should be ashamed of
Borrowing Authority Act
the figures when seeing them in relation to the situation before the recession.
The figures in any case are of no use to them. When they talk about the million and a half peole who are still unemployed, and are still boastful about that great employment achievement, there is no achievement to the million and a half unemployment when they can still find no jobs.
Another aspect, which has not been dealt with by the Government and for which it will have to account to Canadians in due course is the whole matter of how it has dealt with the voluntary sector. By the voluntary sector, I mean charitable and community organizations. This sector, which has been proven to be the largest job creation sector in Canada, one of the most labour intensive sectors, which provides services to Canadians at the least possible cost and which the Government could never duplicate, where our young people might find jobs and a place to serve and feel useful, has been given no incentives and no recognition.
Over the past few years, the percentage of people and companies contributing to charities unfortunately is declining, as is the size and the percentage of their gifts in terms of income. The National Voluntary Organization has for years been advocating new incentives in income tax to increase charitable giving. More specifically, it has advocated the so-called give-and-take program which would provide a 50 per cent tax credit for charitable contributions.
This is what the present Minister of State for Immigration (Mr. McLean) promised before the Government was elected in 1984. When in opposition, the present Minister of State for Immigration made the give and take proposal his, if you might call it, pet crusade.
Let us look at a few of the promises he made. I can hardly do justice to all of them, but when in Opposition, the Minister of State for Immigration, who prior to this was the Secretary of State, said:
We are committed to a fundamental realignment of the tax treatment for charitable giving-the principle of a charitable tax credit-which will offer equitable incentives to all taxpayers to support their charities.
In other words, he said that he was entirely in favour of the give and take proposal. When he became Secretary of State, under whose area this particular subject falls, we know that nothing took place. He also said that the voluntary sector was the largest employer of lower and middle-class Canadians. He was right when he pointed out its importance.
In addressing the voluntary sector, the Minister of State for Immigration said:
You offer many less advantaged Canadians a bridge to employment. Canada's voluntary sector is an untapped resource that not only can reduce government spending but can actually create jobs in the process.
The Minister said that not only would there be more jobs but that the voluntary sector would also reduce spending, two apparent objectives of the Government.
Because the Conservatives are committed to more jobs for young people and because the Conservatives are committed to reduce spending, he said before the election:

March 17, 1986
Borrowing Authority Act
That is why we are committed to a principle of a charitable tax credit, to a tax environment which will offer equitable incentives. Give and take is on the agenda.
The Minister said that give and take was on the agenda along with the other statements I cited so far in a speech addressed to no less than the National Voluntary Organization convention. That was before the Tories were elected. The present Prime Minister (Mr. Mulroney) also, before the election, promised to the National Voluntary Organization and the
52,000	voluntary organizations, that is charitable organizations, churches, community organizations, the following:
We are committed to implementing a tax credit equal to a percentage of donations made to registered charities.
Those are the words of the Prime Minister himself. Is it any accident that the Prime Minister has done nothing to fulfil this promise? We know that he has done nothing to fulfil this promise because we have already received from his Government one set of financial statements, two Budgets, and two sets of Estimates. The Government has had plenty of time to honour what the Prime Minister and the Minister of Employment and Immigration (Miss MacDonald) solemnly promised just before the election that they would to if they came to power. They said it was logical to bring in the give-and-make proposal because it would help create jobs and save money, two admirable objectives.
Because nothing is done to increase the level of charitable donations by widening the potential number of contributors and the size of their gifts, the voluntary sector is now less and less able to assume responsibilities for social work and the serving of social needs. This means either increased Government programs, which will cost the taxpayer money, or less adequate or deteriorating services for the community. It seems to me that the latter is what we are in for. The vital area for job creation in the voluntary sector will soon be lost to the young people of our country. Another door will have been slammed closed because of Tory policies and this Tory Budget.
One can get a sense of the way in which the Tory mind works when we see what they have done to Katimavik. For nine years this organization has proven its mettle. It establishes relationships between human beings, edifies young peoples' concepts of citizenship, and gives them a chance to understand one another's linguistic backgrounds through exchanges between Francophone and Anglophone peoples. Yet, the Government has taken the axe to this program in the name of youth employment. For God's sake, there is more than just employment involved in Katimavik. It involves character and citizenship and goes beyond the question of employment.


John Edmund Parry: Mr. Speaker, as I understand it, the motion being debated at the moment is one for a six-month hoist of the Government's Bill to borrow the astounding sum of $22.6 billion. In considering this measure and the grave and far-reaching implications which it has for the Canadian economy, I would like to remind Hon. Members
of the disgraceful antics which we saw last year attendant upon this very same legislation.
My purpose in rising is not to criticize the borrowing of money either on grounds of principle or on pragmatic grounds, nor even to state that this is something which should or should not be done. Rather, my purpose is to look at the way in which money is borrowed and the purposes for which it is used. Last year, to remind Hon. Members, we had a charade in which that non-elected body that sits like a canker at the very heart of our democratic society-I refer, of course, to the Senate- decided, in some flight of fancy, that it might some legitimacy within Canadian society and some relevance to the processes of democratic Government. It took it upon itself to delay the Government's borrowing Bill for 1985.
That was an historic abuse of what passes in this country for power. It was an historic abuse which was encouraged, 1 very much regret to say, even by some elected members of the Liberal Party of Canada who sit in this Chamber. I believe that the use of the Red Chamber in the obstruction of last year's Government borrowing Bill, whatever we might think of the legitimacy of the purposes, the relevancy of the exercise, and the appropriateness of the amount, was something that we would not hope to see repeated and something to which the Government and the House could put an end forever if it were to abolish the Senate. We spent approximately $27 million on the Senate last year. It is true that in the context of $22.6 billion that is not a very large sum, but nevertheless, Mr. Speaker, a sum which could have been saved.
I could instance some other ways in which sums could be saved in order to reduce the amount of $22.6 billion which the Government proposes to borrow to a sum which we might find a little more reasonable. I am referring, of course, to that great pork barrel orgy, that great swilling in the sky, which the Progressive Conservative Government instituted when it came to office in September of 1984. At that time, in both quantity and expense, the Canadian people saw an unprecedented expansion of ministerial staffs. There was a totally uncalled for recruitment of hacks, flacks, and bagmen to positions which now paid up to $80,000, sums which could only be dreamed of in the previous administration, except, of course, by those who were privileged and fortunate enough to hold more than one post.
To give it credit, the present Government decided to go the high road and make this blatant patronage orgy at least something which those of us who were scrutinizing the accounts and reading the reports of recruitment could see with our own two eyes. Ministerial expansion went hog wild in 1984, and we have not seen any restraint introduced in that area of government operations since. As an example, there is one ministry in the Government, which I do not propose to name, which is known to every Member of the House, which has no programs-


Sergio Marchi: Go ahead.


John Edmund Parry: My colleague, the Member for York South-Weston (Mr. Marchi), encourages me to go ahead, and 1
March 17, 1986

would like, at least in this detail, to oblige him. I am speaking, of course, of the Minister of State for Youth (Mrs. Champagne) who has no programs, no budget, and nothing very much to say when she is given the opportunity in the House. Nevertheless, on her payroll she is maintaining a chief of staff, a limousine, and presumably a driver, and an executive assistant. We have received no bulletin which states that there has been a reduction of staff or reassignment of responsibilities, which any organization in the private or public sector, under the circumstances, would find quite appropriate and reasonable. As far as we know, there is still that ministerial encumbrance-

A staff that oviously does nothing and is utterly useless in a department that has no program and no budget.. . But nevertheless, these people keep their jobs and remain employed and they keep on being a burden on the taxpayers-

The taxpayers of the country must support them in the style to which the Government has made them accustomed.
Although I could continue, I will turn away from the matter of ministerial staffs and the way in which they have swollen from the Prime Minister's Office on down. I would now like to turn to what the Government uses the money for when it gets it. The prime example from last year was bank bail-outs. A couple of Canadian banks failed and, quite gratuitously, without any great urging on the part of their advisers, and without any great pressure in the ranks of the Cabinet, the Government decided that it would be like the little boy at the dike and put its finger in to plug the hole. That particular hole and that particular finger cost the taxpayers of this country $1 billion, or so it would appear from the accounts presented. I doubt very much if the final bills are in.
Let us go now to the topic of tax loopholes. The Government often says that the Right Hon. Leader of the Official Opposition (Mr. Turner) is the father of the deficit. It must be admitted that there is some justice to that allegation. However, I think we should look at the way in which the deficit has been built up. As my friend, the Hon. Member for Mount Royal (Mrs. Finestone) pointed out, it has been built up through a gradually shifting balance between the personal and corporate tax contributions to the cost of running Government. Over the past 30 years we have seen personal taxes gradually rise and corporate taxes gradually fall. That is something the Progressive Conservative Government should be working to reverse rather than reinforce. Yet the Government is going to allow corporate tax contributions to drop to less than 20 per cent of total taxes raised this year.
The Government also introduced a capital gains tax break, and allowed the little Egypt bump in the case of Gulf oil. Concerning indirect taxes, we see the Government's major preoccupation is not with imposing taxes in such a way that the economy will not stagger under the load; it is simply concerned with the revenues which can be yielded through tax
Borrowing Authority Act
increases. Therefore, in the last Budget, even with an outcry against taxes on gasoline, we saw taxes go up four-tenths of a cent a litre at the wholesale level. The federal sales tax increased by 1 per cent, following on the previous increase of 1 per cent for which this Government tried to evade responsibility by saying it had been foreseen by the previous Government. Perhaps worst of all, we now have a VAT by another name in the form of the business transfer tax which the Government is now promoting across the country. We know what the agenda is. It is simply to get more out of the economy for government operations. We have not seen the Government differentiate between this business transfer tax and the hated value added tax which imposes such an enormous accounting burden. The Government has not addressed that point at all.
Finally, if I may, I would like to-you are giving me the time signal, Mr. Speaker? I cannot believe it. 1 was really just getting started. However, I will close by stating my opposition to this borrowing Bill and I thank the House for its attention.
IWr. Sergio Marchi (York West): Mr. Speaker, I, too, am very pleased to participate in the debate on the borrowing authority. Any discussion of this subject cannot, of course, he carried on in isolation. One naturally has to link it to the Budget handed down last month. Also, of course, one has to link that Budget to the May, 1985 Budget. When Canadians do that, they ask whether the Budgets are appropriate and fair. In both Budgets we got a mountain of documents, figures, graphs and all the rest of it. We as parliamentarians have to break those documents down to their lowest common denominator in a way which can be understood by average Canadians from coast to coast. When that is done, Canadians can then distinguish the true colours of this Conservative Government.
This Government has been going across the land saying these Budgets are tough but fair. They are not. They are simply tough and unfair. We realize very quickly just how unfair not only the imposition of new taxes is, but how and to whom the new taxes are directed. If you earn between $15,000 and $20,000 a year, by 1990 you will be paying a tax increase of some 23 per cent. If you earn $30,000 to $35,000, the increase drops to approximately 15 per cent. If you earn $100,000 or $200,000, the increase is only 1 per cent. I ask you, Canadians are asking themselves, and in 1988 will be asking the Government: Is that fair and equitable? The obvious answer is a resounding no. You cannot expect Canadians to see that kind of disparity as being fair. You cannot ask the individual earning $15,000 to tighten his or her belt more than his neighbour earning $100,000. All Canadians, regardless of income, regardless of region, are prepared to make the necessary sacrifices to enhance the economic wealth and prosperty of this country. What they are not prepared to do is to make sacrifices that other Canadians are not being asked to make. Therein lies the injustice and unfairness. We are asking one economic class in this country, the lower-income groups, to pull more weight than their wealthy friends. That will fuel the fires of disparity.

March 17, 1986
Adjournment Debate
Canadians perceive the gulf of disparity to be widening under this Conservative Government. There is a line between the rich and the poor, between the various classes in our society. We have had struggles in this country between federal and provincial Governments. We have had struggles between the East and the West. We have had struggles along linguistic lines, between French Canada and English Canada. We have found ways to resolve the struggle. However, what we have never had in this country, and what Canadians hope will never happen, is a struggle based on class stratification. Yet that is becoming more pronounced. It is not like what we see on our television sets in Great Britain and other parts of the world, but it is beginning to happen on our own doorstep. When we have people lining up at churches for food vouchers and hand-outs there is something wrong. We cannot afford to put in place programs which will fuel class stratification. Yet some of the programs in these two Budgets are doing exactly that.
I see that you are telling me my time is up, Mr. Speaker. I would like to continue with unanimous approval of the House.


Some Hon. Members:: Oh, oh!


The Acting Speaker (Mr. Charest):: Is there unanimous consent?


Some Hon. Members:: No.


The Acting Speaker (Mr. Charest):: I'm not too sure, but 1 do not think there is unanimous consent.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Standing Order 66 deemed to have been moved.

Stanley J. Hovdebo: Mr. Speaker, there are 67,500 Guaranteed Income Supplement applications to be processed in the regional Health and Welfare office in Regina. In January of 1986 we were informed that the usual 27 temporary staff would not be available this year to make sure that the job was done by the time the April cheques were to be issued. I raised the issue in the House on February 4, 1986, and the Minister did not deny the fact that fewer people would be available for this processing. He indicated that an inset would ensure that no one went without their GIS cheques in April. Since February 4, however, most of the temporary help has been made available, and it appears that most of the
applications will be processed, but a few will be disappointed by not receiving their cheques in April.
However, the concern about service has not gone away. Just today we were informed that the two client service centres in Ontario, one in Scarborough and one in Oakville, have been closed or are to be closed from March 31. They are to be closed permanently. The employees of Health and Welfare, like other members of the Public Service, are being told that they cannot have job security. The result is likely to be further disruption of service in the form of strikes and possibly other labour action.
The real reduction in service is not from action on the part of the employees, but because the Government is embarked upon a process of reducing and cutting service. The Nielsen report probably embodies the main theme of this Government in cutting. If there is not a monetary return on investment, an investment should not be made. That theme is cutting into the service which the country has learned to expect from the Government of Canada. I ask the Minister to review his process of reduction of service by cutting, as he did in Regina and other service centres across the country earlier this year. Recognizing the folly of his ways, I suppose, he refilled those positions so that the GIS applications could be processed. 1 ask him to provide enough people to minimize the hurt of the people for whom he is responsible, the old people, the young people, and the ailing. Those are the people for whom the Minister of National Health and Welfare (Mr. Epp) is responsible. Every time he cuts a program, every time he cuts a centre, he is reducing the service that is provided to that group, the old, the young and the ailing.


Gabrielle Bertrand: Mr. Speaker, I want to take this opportunity to give the Hon. Member and all recipients of the Guaranteed Income Supplement and the Spouse's Allowance and their families, the assurance that the current number of employees is sufficient to process all renewal applications on time.
As the Hon. Member pointed out during the February 4 Question Period, the number of temporary staff hired this year to process the annual renewal applications is lower than last year's. However the figures he gave are inaccurate and I would like to correct them because the Hon. Member's statement may have left the impression that the Department will be hard pressed to process the renewal applications on time. The Hon. Member claims that this year the Regina income security programs regional office has hired only two temporary employees as compared with 27 last year. In fact, 18 temporary employees were hired this year as compared with 22 last year.
The Minister of National Health and Welfare (Mr. Epp) is convinced that such small staff reductions will not prevent the
March 17, 1986

Department from processing renewal applications on time. However, we are seriously looking at the situation, and if difficulties should arise, I can assure you that full-time employees will be temporarily redeployed so that no application is delayed. The Minister is aware that recipients of the guaranteed income supplement and the spouse allowance depend on regular payment of those benefits. He has asked the Department to make sure that each application for reinstatement of the guaranteed income supplement and the spouse allowance will be processed in time.
The Minister also has asked me to emphasize to recipients the importance of submitting their reinstatement application as soon as they have relevant information on their income. Each year, a number of recipients fail to submit their application forms on time and have their benefits interrupted. This unecessary interruption could easily be avoided. The recipient only has to submit his reinstatement application as soon as possible.


THE DISABLED AND THE HANDICAPPED-EFFECT OF BUDGET MEASURES. (B) SITUATION OF THE HANDICAPPED-GOVERNMENT POSITION
Robert Phillip Kaplan: Mr. Speaker, on March 3, 1986, I asked the Minister of Finance (Mr. Wilson) about a certain increased deduction in income tax for the handicapped.
I wanted to make the observation that the two Budgets and the Economic Statement of the Government amount to the largest tax increase in the history of Canada, including in time of war. That is a development in itself which we feel is a criticism of the Budget and what, I believe, Canadians find hardest to bear. We have a lot of social programs which have to be paid for, but when they are paid for at a rate which can damage the growth of our economy, I believe that is going overboard. More and more economic commentators are observing that this is a Budget which can kill or damage growth in the Canadian economy and, therefore, is counter-productive.
When we complain about how heavy the increase in taxes in the Budget is, the Government always comes back to us saying: "Yes, but we have taken care of those who are the worst ofF'. The Government points, for example, to the allowance which was introduced in the Budget with respect to sales tax so that Canadians who are the poorest can claim a rebate or deduction from their income tax for the new heavy sales tax they will have had to pay pursuant to these Budgets. We have demonstrated, and 1 do not want to take too much time to do it here, that even for the poorest of the poor, the relief which is given in the Budget is far from the increased burden which the individual will have to pay in sales tax. Therefore, even for those who are worst off, the tax relief is tiny. I recall figures of a $7 billion tax increase after five years and a $300 million sales tax relief. That is peanuts compared to the heavy burden which middle and low-income Canadians will be paying.
Adjournment Debate
Tonight 1 wish to focus attention on what the Minister of Finance has offered to the handicapped, who will also be paying increased sales taxes and increased taxes. They will receive an additional $250 per year deduction for their extra expenses. A deduction means nothing to most of the handicapped since about 1.8 per cent of the disabled earn incomes which place them in taxable brackets. Therefore, if the Government wished to do anything for the disabled, it would be something in the nature of a credit such as was provided to mothers looking after children at home. This was a credit introduced by the former Government which put money into the pockets of those most in need. That is not accomplished here. Nothing is done for those, if 1 can put it ironically, but the best-off among the handicapped, the ones who have to pay income tax.
This is a measure introduced by a Minister who bragged about being proud to help the very poor and that this was what his Government was all about. As I was looking at what was done for the handicapped, my eye fell on the chart at page 42 of The Fiscal Plan which shows that the cost to the Government of the measure which was introduced in its first full year of operation, that is 1986-87, is zero. Therefore I asked the Minister about it. I asked him how he could say that he was helping those handicapped who pay income tax, that very small percentage of handicapped who are able to earn an income which puts them in a tax bracket of zero. The answer he gave was that the effects of the change this year will not be felt until the next taxation year as the tax returns come in. I reject that answer because 1986-87 is the first fiscal year in which these tax changes come into effect. That is the year which begins at the end of April and includes the end of the 1986 taxation year of all individual taxpayers. Therefore, it includes the handicapped. If this benefit shows anything, it should show some cost to the Treasury as of the end of that taxation year, which is included in the Government's 1986-87 fiscal year.
This is why I wished to draw this matter to the attention of the House and of the country. 1 do so in order to show just how cheap the Government is. It does this in an attempt to disguise the heavy burden of this Bill and the former Budget on taxpayers, especially the poor and those toward the bottom end of the scale. The Government has thrown them little concessions which in this case amount to nothing and, in the case of the sales tax credit, very little. 1 wish to expose the Government for what it is doing, which is taking with one hand and taking with the other.


Mr. Chris Speyer (Parliamentary Secretary to Minister of Justice):: Mr. Speaker, with respect to some of the comments made by the Hon. Member, I point out to him that the one legacy which the Liberal Government left to the Canadian people was this horrendous burden of debt, the result of which made it necessary to increase taxes. In these circumstances, 33 cents out of every dollar which is sent to Revenue Canada is for the purpose of paying off the interest on the debt. That is the legacy which has been exposed time after time. Indeed,

March 17, 1986
Adjournment Debate
there is a certain degree of hypocrisy in complaining about increasing taxes when we are trying to act in a responsible manner.
With respect to the specific question regarding the handicapped, I point out to the Hon. Member that it was this Government which broadened the definition of "disabled". That was done in the 1985 Budget to include all severely disabled Canadians, including those who are markedly restricted in their activities of daily living as a result of blindness, diseases of the circulatory system, mental disorders, diseases of the musculoskeletal system and connective tissues, diseases of the nervous system, sense organs and the respiratory system. Previously, in order to qualify for the disability deduction, an individual would have to be blind for a year or substantially confined to a bed or a wheelchair throughout that year.
The new definition is to be administered by the Department of National Health and Welfare and comes into effect in the 1986 taxation year. The total population expected to be eligible for the disability certificate is 185,000, up from the
165,000	before the May, 1985 Budget. 1 think this is an incredible step forward for the disabled and shows the Government's commitment to the disabled. 1 would point out that the cost of the $250 increase in the disability deduction is $10 million per taxation year.


CRIMINAL CODE-BOMB THREAT HOAXES-REQUEST FOR STIFFER PENALTIES
Alan Redway: Mr. Speaker, you will recall, no doubt, as well as I do, that a few short weeks ago in January of this year, there was an alleged bomb threat at the Ottawa airport, the Toronto international airport and the two airports in Montreal. This bomb threat caused a tremendous amount of additional security to be put in place at all four of those airports and cost the taxpayers something close to $1 million in extra security costs. That occurred just a short time ago and since that time, there has been a tendency for all Canadians to forget the fact that there was this bomb threat hoax and to forget that from time to time we have been subjected to bomb threats and terrorist activities. We tend to think that those things happen in other countries, perhaps in the Middle East, Asia or Africa, but that they do not happen right here at home. In fact, as you are quite well aware, Mr. Speaker, they do happen right here in Canada and they happen to our fellow Canadians.
Over the last 15 years or so, there has been a very large number of terrorist activities occurring right here in Canada or to our fellow Canadian citizens. Back in 1972, letter bombs were sent from Amsterdam to the Israeli legations here in Ottawa and also in Montreal. The same year, four other letter bombs were sent to Canadians Jews in Toronto. In 1973, another letter bomb was sent to a rabbi here in Canada. In 1976, two armed terrorists bound for the Olympic Games were arrested by Canadian police. In 1979, two Canadians were injured by bombs which exploded in Rome, Italy.
There were three terrorist activities affecting Canadians or Canada in 1982. A Turkish diplomat was shot and wounded here in Ottawa. The same year, the Turkish military attache here in Ottawa was murdered. Two industrial plants, one in Toronto and one in British Columbia, were bombed.
Last year, there were five different terrorist activities involving Canada or Canadians. A Canadian security guard was killed at the Turkish Embassy here in Ottawa. As well, there was a bomb threat which severely affected the Toronto subway. It has now been confirmed by an inquest held in India that the Air India flight was destroyed by a bomb that killed some 329 passengers, 90 of whom were Canadian children. Last year as well, two people were killed in Tokyo as a result of a bomb that exploded after it was found in baggage that was taken off a Canadian Pacific flight.
There was also the killing of Valinda June Leonard and her 16-month old son from Alberta by commandos who stormed the hijacked Air Egypt flight. Just this year, in addition to the case which I cited earlier, there was an attack on the Romanian consulate in Montreal by an armed gunman.
How do we deal with the terrorist activities which have been going on in our country? I was very pleased to hear the Solicitor General of Canada (Mr. Beatty) announce the formation of the anti-terrorist squad of the RCMP. Apparently it is to be a crack commando team which will be under police control, not under military control. It will be used to rescue hostages. Also, there was an indication from the Solicitor General that he would be beefing up security at our embassies, consulates and airports. At the same time, he indicated that Canada was making it quite clear that there would be no deals, no pay-offs, no ransom or no exchange of hostages with terrorists. As well he indicated that he intended to discuss with the media the question of ensuring that terrorists did not receive any special treatment or special publicity as a result of their activities.
In addition, I was very pleased to hear the Prime Minister (Mr. Mulroney) come out with sanctions against Libya after the attacks at the Rome and Vienna airports. However, other things can be done as well. The North America Jewish Students Network in Canada has suggested the establishment of a parliamentary committee and the idea of barring terrorists and their organizations from the country. Those are good suggestions but, as I indicated to the Minister of Justice (Mr. Crosbie) on February 4, I think that we should also review the Criminal Code, look at new penalties, look at new offences and look at the whole idea of restitution. At that time the Minister of Justice said that he agreed with me and that he thought we should be doing something about it.
I fervently hope that the Parliamentary Secretary will shed some light on the whole situation tonight and tell us that there will be some new penalties, some new offences, and that the whole question of restitution will be considered seriously within the context of terrorist activities, bomb threats and bomb hoaxes.
March 17, 1986


Chris Speyer: Mr. Speaker, when this question was originally asked, it was as a result of the bomb threat at the Ottawa airport, as my hon. friend pointed out. The circumstances of that case were very peculiar, but no doubt it alerted my colleague to the larger problem of terrorism. 1 should like to refer to the specific facts of that case. The comments of the originator of the alleged threat were later misinterpreted. He made no remark which should or could be the subject matter of a criminal prosecution. The individual misinterpreting and passing on the so-called threat did so in an honest but mistaken belief that he had heard the first individual disclose a plan to plant a bomb on an Air Canada flight. As a result of this confusion, although it was not in any way illegal and no charge could be laid, my colleague has pointed out before in the House the tremendous expense Canadian taxpayers had to endure in order to ensure safety of the Canadian travelling public.
Adjournment Debate
I listened with great interest to the Hon. Member's concern about terrorism. Nobody with any sense of wisdom cannot be apprehensive that terrorism will arrive on our shores and that we have to be prepared for it. I know the Minister of Justice (Mr. Crosbie) is concerned about it. There are provisions in the Criminal Code right now in respect of false threats and in terms of circumstances where a person passes on a false threat to blow up an airplane or such. It may very well be the penalties are not sufficient, but they are being reviewed at this moment. I give my friend the assurance that we will take his submission seriously in order that we might head off any future problems.


The Acting Speaker (Mr. Charest):: 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 6.25 p.m.
[Stage Direction]

Tuesday, March 18, 1986
Mr. Speaker:: I would like to inform Hon. Members that the noise coming through the interpretation system is being investigated.