1986-12-12

STATEMENTS PURSUANT TO S.O. 21


Mr. Alfonso Gagliano (Saint-Leonard-Anjou):: Mr. Speaker, this morning I received a letter from Denise North of Richmond, B.C., and I would like to share a part of it with the House. She writes:
This letter is concerning the 29-cent stamp that was issued at Christmas, as it can be used only on envelopes that have a matrix imprinted on.
This is unfair to a lot of Canadians who already have their cards from last year or from organizations who haven't taken part.
In the past few weeks we have seen supermailboxes that open easily, keys that fit all boxes, and now tick and stamp envelopes. When will Canada Post take the delivery of mail seriously and stop creating two classes of citizens? Some Canadians can send Christmas cards for 29 cents, and some Canadians have to send Christmas cards for 34 cents. Why can a 29-cent Christmas stamp not simply be a 29-cent Christmas stamp without having to buy a special envelope that ticks?


AIRPORTS
Mr. Terry Clifford (London-Middlesex):: Mr. Speaker, airport safety is of great concern to the people of London- Middlesex and indeed to all Canadians. Safety has been the cornerstone of all the Government's transportation initiatives. No stone has been left unturned.
The crash firefighting rescue service standards set by the Minister of Transport (Mr. Crosbie) exceed the standards set by the ICAO. In fact Canadian standards are more stringent than those of the Federal Aviation Authority of the United States. A regular monitoring system of the people and equipment to do the job is in place. Category levels of service are appraised annually.
[DOT] (U05)
London airport will receive the new rapid-intervention vehicle which has both dry chemical and foam firefighting
capabilities. Our Government is committed to safety. We will have the highest standards of people and equipment. As far as this Member of Parliament is concerned, safety at the London airport will not be compromised.


CANADA POST CORPORATION
Mr. John Parry (Kenora-Rainy River):: Mr. Speaker, the Canada Post project designed to curtail rural services drastically has shaken the 30 per cent of Canadians who live and work outside cities and urban areas. Canada Post intends to close 1,700 rural post offices and privatize 3,500 more over the next five years.
The Canada Post legislative mandate is to provide services to Canadians, no matter where they live. Whereas Canada Post is attempting to do away with rural routes; whereas a clan of Conservatives is trying to flout parliamentary traditions by holding secret meetings on this issue; and whereas the Prime Minister is giving us vague assurances that rural mail will not be wrecked, Canadian men and women serviced through Canada Post rural deliveries insist that such services be maintained as a matter of right.


CANADIAN WHEAT BOARD
Mr. Bill Gottselig (Moose Jaw):: Mr. Speaker, I would like to draw to the attention of the House a matter of great concern not only to my constituents but to all those producers in western Canada who sold high quality No. 1 and No. 2 wheat during the crop year which ended July 31, 1986. The Chief Commissioner of the Canadian Wheat Board indicated recently that there may have been some cross-subsidization of prices and, as a result, there is little likelihood of a final payment on the wheat sold during that time.
Since higher grades were sold at a significant premium to the initial prices throughout the crop year, this is not acceptable to producers of those grades. The objective of the pooling

December 12, 1986
system is to provide a producer with the average yearly price of the commodity he delivers, not to ensure a common return to all producers. I call on the Minister responsible for the Canadian Wheat Board to review this matter thoroughly in order to ensure that producers are treated fairly in this instance, as well as to set policy for the future.


UNEMPLOYMENT INSURANCE
Mr. Jean-Claude Malepart (Montreal-Sainte-Marie):: Mr. Speaker, older workers in Quebec and throughout the rest of Canada are ever more disappointed by this Conservative Government. I can say that the elderly people who came here to defend the interests of older workers in Quebec left disillusioned. Next Tuesday, in Quebec City there will be a general meeting of all older people who have been victimized by unemployment insurance benefit cut-backs. Similar rallies are scheduled for Montreal, Trois-Rivieres, and the Lac-Saint-Jean region.
Quebecers will form a common front to support all retirees and all the 1985 early retirees who are seeking a full repayment of the money owed to them, and to fight against the Government's impending legislation under which there would be two classes of older citizens, to the extent that some of them would not be eligible for unemployment insurance benefits while they are looking for other work.

[DOT] (mo)


EXTERNAL AFFAIRS
Mr. Alex Kindy (Calgary East):: Mr. Speaker, on December 4, 1986, Israeli soldiers put up barricades to the entrance of Birzeit University on the West Bank. The Palestinian students protested the erection of the barricades with a sit-in. The Israelis shot two students, and violence erupted for 8 days. The end result was that 4 students were killed, 5 are missing, 52 were wounded, and 500 Palestinians were detained by the Israeli occupation forces.
Canada, with its track record as a mediator for peaceful solutions to international problems, should support the call for an immediate international conference on Palestine so as to correct the long-standing injustices to the Palestinian people.


AGRICULTURE
Mr. Vic Althouse (Humboldt-Lake Centre):: Mr. Speaker, just as environmentalists in Canada are trying to protect endangered species of wildlife, plant geneticists at Agriculture Canada are trying to protect Canada's dwindling plant resources which are at risk because the Government has delivered severe cut-backs to agricultural research. The cutbacks last year, and further cut-backs of 22 per cent for 198687, have not only forced the Plant Genetic Resource Centre to ignore domestic plant varieties, but have also put our international collections in danger.
Canada holds the world's principal base collections of oats and barley, but it could face embarrassment because it is not taking proper care of its international collections.
When Dr. Charles Bishop, Canada's representative on the International Board for Plant Genetic Resources under FAO, complained to Dr. LeRoux, the then Assistant Deputy Minister of Agriculture, he was told that the level of technical support and storage capacity at Canada's Plant Genetic Resource Centre "has never been adequate and has in fact regressed over the past three years as a result of major budgetary cut-backs in our branch". These cut-backs must cease.


TRIBUTE TO CERTAIN MEMBERS OF PUBLIC SECURITY FORCE OF DRUMMONDVILLE, QUE.
Mr. Jean-Guy Guilbault (Drummond):: Mr. Speaker, 1 would like to draw the attention of the House to some deserving members of the Drummondville police force. First of all, last June, the Governor General, the Right Hon. Jeanne Sauve, awarded the medal for bravery to Rejean Paul-Hus.
Last week, acting on behalf of the Solicitor General and the Governor General, I awarded the police medal for distinguished service to 29 members of the Drummondville police force. This medal is awarded for outstanding service, to express the community's recognition for services rendered in high-risk areas.
These peace officers have demonstrated their ability to enforce law and order and their conviction: Justice for all.
I welcome this opportunity to pay tribute to individuals who have such distinguished record and who are dedicated to protecting the lives of their fellow citizens.
December 12, 1986


MEMBERS OF PARLIAMENT
Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, Tories are a strange lot!


Mr. Fennell:: Not as strange as you are.


Don Boudria: It would appear that yesterday in a Tory meeting one of the Tory members of the secret committee to discuss postal issues decided to "stool" on everybody else and to reveal what had gone on at the committee. Here is what the Conservatives in majority, seemingly less one, the one who probably stooled on the others, had to conclude: That Canada Post had made no attempts to interfere with Government plans to raise a first-class postage stamp to 36 cents; that rural post offices should be turned over to the private sector; that group mailboxes are supermailboxes, as some people dare call them, and they should remain; that large publications now benefiting from postal subsidies should lose them.
This appears to be a somewhat quasi-unanimous opinion of the Tory members on that committee. I wonder what the end report will look like. I wonder what the Tory who leaked it will look like once the others get hold of him.


HUMAN RIGHTS
Mr. Bill Attewell (Don Valley East):: Mr. Speaker, in 1979 over 51,000 Jews were allowed to emigrate from Russia. For the last several years barely 100 Jews a month have been permitted to leave. In place of numbers the Soviet Union has adopted a cruel ploy of releasing high profile refusniks to mislead the world into thinking the U.S.S.R. is compassionate.
Nine months ago on February 11,	1986, Anatoly
Shcharansky was allowed to leave Russia and join his wife, Avital, in Israel. We were thrilled by this news. However, we were deeply saddened to hear two days ago that Anatoly Marchenko, who was a member of the disbanded Helsinki Watch Group, died in prison. He had been imprisoned in Russia for over 20 years as a penalty for his fight for human rights.
The Soviet Union needs to be condemned in the strongest possible terms for its flagrant disregard of the human rights Accords it has signed.


AGRICULTURE
Mr. Rod Murphy (Churchill):: Mr. Speaker, after months of indecision, the Government announced the Special Canadian Grains Program which has greatly disappointed western farmers.
As reported in the Winnipeg Free Press on Wednesday, December 10, Bob Douglas, spokesperson for the Keystone Agriculture Producers of Manitoba, a large farm lobby group, said that he was disappointed and that he expected a severe reaction from farmers.
In an editorial in yesterday's edition of the Winnipeg Free Press, the following was reported:
It took months for Prime Minister Brian Mulroney's Cabinet to decide how it was going to face up to its responsibility to assist western agriculture. When the equivocation ended, the Prime Minister used the distress of western farmers as a political tool-
With regard to the delay in the distribution of dollars, the Winnipeg Free Press editorial went on to indicate:
Mr. Mulroney has no problem rolling aside such stones when he wants to corrupt the federal bidding process or to move a jail, at immense cost, to his own riding.
If I may add my own words, money was always found to bail out banks and to support unknown bank depositors. Money is going to pay off investors in the Bank of British Columbia, and capital gains will be 100 per cent tax-free for many investors. Why do our farmers deserve less?


CANADA MORTGAGE AND HOUSING CORPORATION
Mr. Dave Nickerson (Western Arctic):: Mr. Speaker, the announcement last Wednesday by the Minister responsible for CMHC of the first issue of National Housing Act mortgage backed securities was a milestone in the history of residential dwelling finance in Canada.
The advantages of Canadian equivalents of the popular United States "Ginnie Maes" include the mobilization of further funds into residential construction, the stabilization of mortgage interest rates, and the creation of an attractive senior investment vehicle for both individuals and institutions.
As expected, once a vibrant secondary market and perhaps even a futures market develop, liquidity will be enhanced.
Congratulations are due to the Government, CMHC, and the involved financial institutions for their initiative in creating the new tradable mortgage backed securities guaranteed in terms of timely monthly payments.

December 12, 1986
Oral Questions



ORAL QUESTION PERIOD


Hon. Herb Gray (Windsor West):: Mr. Speaker, in the absence of the Minister for International Trade my question is directed to the Deputy Prime Minister. Yesterday in Question Period the Minister for International Trade replied to my questions about the Canadian connection to the arms to Iran affair by saying:
-I can assure the Hon. Member that this issue is being thoroughly investigated.
After Question Period and later in the day, RCMP spokesman Belanger apparently told the press the following: "There is no investigation in this matter. There is no file on this matter. No one asked us to start an investigation". Would the Deputy Prime Minister explain the contradiction between what the Minister for International Trade told me and what RCMP spokesman Belanger told the press later in the day? Exactly what is the RCMP doing in this matter? Who is carrying out the investigation? What has the Government found out so far? In short, why is the Government apparently so much in the dark about the Canadian connection in this arms to Iran affair?


Hon. Don Mazankowski (Deputy Prime Minister and President of the Privy Council):: Mr. Speaker, we are dealing here with a series of unconfirmed reports and speculative stories, all of which are being actively investigated. I would like to inform the Hon. Member that through our Ambassador in Washington and the United States Embassy, the Secretary of State for External Affairs raised the matter with Secretary of State Shultz yesterday.


Mr. Blackburn (Brant):: Did he get the answers?


Donald Frank Mazankowski: I am also pleased to inform the Hon. Member that the RCMP have today begun an investigation into this whole matter. The Israeli Ambassador has been asked to co-operate since there has been some suggestion of Israel's involvement. Until such time as some of the facts or speculation that has been circulating can be confirmed, I think it is very unbecoming to comment upon names and a hypothetical situation.


INQUIRY WHETHER CIA DIRECTOR WAS TELEPHONED IN ORDER TO OBTAIN INFORMATION
Herbert Eser (Herb) Gray: Mr. Speaker, the Acting Prime Minister calls these reports speculative. However, they were confirmed personally by the Director of the CIA, Mr. Casey.
I want to ask the Acting Prime Minister whether he, the Secretary of State for External Affairs or the Minister for International Trade or one of their officials have called Director Casey personally to get the information about this affair. If not, why have they not done, so at a time when it is so obviously necessary?


Donald Frank Mazankowski: Mr. Speaker, it sounds like the Hon. Member attended the Foreign Affairs Intelligence Committee hearings. He seems to know more than even Secretary of State Shultz.


Mr. Broadbent:: That is possible. Do not rule it out.


Donald Frank Mazankowski: The fact of the matter is that the Secretary of State for External Affairs has indeed made contact with Secretary of State Shultz. My understanding is that there has been contact with Mr. Casey and with the U.S. Senate Intelligence Committee Chairman and that it would be contrary to U.S. law to reveal any further information at this particular time.


REQUEST FOR NAMES OF CANADIANS ALLEGEDLY INVOLVED
Herbert Eser (Herb) Gray: Mr. Speaker, what should worry the Canadian people is that everybody, including the press, already seems to know more about this matter than the Government.
It has been reported that External Affairs now knows the names of some of the Canadians involved in the Canadian connection to this arms to Iran affair. Will the Deputy Prime Minister give Parliament and, therefore, the public, the names now? Will he also tell us why the Government in its laxity in this matter appears to be condoning the actions of Canadians, directly contrary to Canadian Government policy against the export of arms to a country like Iran? Will the Deputy Prime Minister answer this definite question?


Donald Frank Mazankowski: Mr. Speaker, the Hon. Member may have the luxury of indulging in innuendo and suggestions of wrongdoing without really having all the facts. He suggests that the reports that have been raised in the newspaper are accurate. Which ones does he consider to be accurate? That is not the information that we have been able to confirm at this particular time.


Mr. Gauthier:: What have you confirmed?


Donald Frank Mazankowski: The American Embassy has told the Canadian Under-Secretary of State that it is impossible in the current circumstances to provide any further specific information. Notwithstanding that fact, I am trying to be as forthcoming as I can. I would hope that the Hon. Member would not want me to engage in idle speculation.
December 12, 1986


Mr. Garneau:: Are you the Shultz of the Canadian Government?


Donald Frank Mazankowski: What I am going to give this House-


Raymond Garneau: Are you the Shultz of this Government?


Mr. Speaker:: Order. It is not for the Chair to make any comment on the substance of questions or answers. But I point out that this is a lead question. It is a matter obviously of concern to the Chamber. I think that the Hon. Deputy Prime Minister should be permitted to answer the question.


Donald Frank Mazankowski: All I wanted to tell you, Sir, and the House, is that I will not deal in idle speculation and I will not comment on stories that are not confirmed. What I will endeavour to do is provide the House with up to date and accurate information. As the information comes to our attention I will be more than pleased to provide it to all Members of the House and the people of Canada.


Some Hon. Members:: Hear, hear!


NON-DISCLOSURE OF INFORMATION TO CANADIAN GOVERNMENT
Hon. William Rompkey (Grand Falls-White Bay- Labrador):: Mr. Speaker, one thing the Deputy Prime Minister did confirm was that the Secretary of State for External Affairs had some private conversations with Secretary Shultz. In those private conversations did the Secretary of State for External Affairs get any explanation of why the Canadian Government was not informed about the Canadian connection in the Iran arms affair when the CIA knew about it on October 7?


Donald Frank Mazankowski: Mr. Speaker, I am not sure whether the Secretary of State for External Affairs got an explanation. Needless to say, my understanding is that Mr. Shultz was rather short on information as well. Nonetheless, I can tell the Hon. Member that we have expressed our concern to the U.S. Government over this state of affairs. Naturally we are concerned about this breakdown.


CANADIAN GOVERNMENT'S CONCERN
Bill Rompkey: Mr. Speaker, it appears that it is not enough to express concern. Did the Secretary of State for External Affairs present a formal protest to the U.S. Government over the fact that the Canadian Government was kept in the dark on this matter?


Donald Frank Mazankowski: As I tried to indicate, Mr. Speaker, I am not sure of the details of the information available to Secretary of State Shultz. My understanding is that the information, if he had any, was at best very sketchy.
Oral Questions
Perhaps that is one of the reasons. Nonetheless, we have expressed very grave concern over this state of affairs, and as the investigation unfolds that will certainly be one of the factors taken into consideration.


REFUSAL OF INFORMATION TO CANADIAN AMBASSADOR IN UNITED STATES
John Edward Broadbent: Mr. Speaker, my question is directed to the Deputy Prime Minister.
The Canadian Government was made aware of the situation 48 hours ago, and it has yet to receive the names of the Canadians involved in this affair. This is incredible.

Will the Deputy Prime Minister confirm that Ambassador Gotlieb was told either late yesterday or this morning in Washington that he will not be given access to the information which has now been revealed before the committee in Washington?


Donald Frank Mazankowski: My understanding, Mr. Speaker, is that it would be contrary to U.S. law at this particular time to release that information.


INQUIRY WHETHER PRIME MINISTER CONTACTED UNITED STATES PRESIDENT
John Edward Broadbent: Mr. Speaker, it is not contrary to good relations between allies for one ally to inform another when its nationals are being used for covert operations. This matter clearly involves government to government relations at the highest level. Therefore, has the Prime Minister gotten in touch with President Reagan since this came out in the last 48 hours to express the desire of the Government of Canada, and specifically the Prime Minister's Office, to be fully informed by the President of the United States?


Donald Frank Mazankowski: Mr. Speaker, the Hon. Member is making a number of assumptions in his preamble. I have tried to point out to the House that we are trying to make those confirmations. I appreciate the support of the Hon. Member, who phoned me this morning about another matter, in trying to be of assistance in this whole issue. I appreciate very much the way he has handled it.
The government to government relationship is ongoing and the Secretary of State for External Affairs has been in touch with Secretary of State Shultz. An investigation is going on. Clearly that is the process to be followed and it will continue to be followed.


REQUEST THAT PRIME MINISTER OBJECT TO TREATMENT BY UNITED STATES
John Edward Broadbent: Mr. Speaker, the Secretary of State for External Affairs said on the news this

December 12, 1986
Oral Questions
morning that Mr. Shultz did not know anything about it. We are getting most of our information from leaked reports in The Washington Post or other news reports. The head of the CIA himself apparently said that he was informed some two months ago of a Canadian connection. Taking all of that into consideration, does the Deputy Prime Minister not think it is about time that the Prime Minister of Canada raised an objection to the way that we, an ally, have been treated by the President of the United States in this very sensitive matter?


Donald Frank Mazankowski: Mr. Speaker, I have received no indication that the United States administration has deliberately withheld information from Canada. The key point in the question of the Hon. Member was his reference to "leaked reports". That is what they are and I think they should be considered as such. Until such time as there is some semblance of confirmation about some of these reports and unconfirmed speculative stories, it is, with respect, certainly very difficult to draw the kinds of conclusions which the Hon. Member is drawing.


INQUIRY WHETHER GOVERNMENT KNEW OF POSSIBLE INVOLVEMENT OF CANADIANS
Raymond Garneau: Mr. Speaker, my question is for the Deputy Prime Minister. Yesterday I asked the Minister for International Trade the following question:
Was the Canadian Government informed in October of this year that Canadians were involved in the sale of arms to Iran?
After carefully reading the Minister's answer I find, as I found yesterday, that the Minister did not answer the question very clearly. Therefore, today I will ask the Deputy Prime Minister whether the Canadian Government knew, prior to yesterday, from any source whatsoever, that Canadians were involved in either the sale of, or the financing of the sale of arms to Iran?


Donald Frank Mazankowski: Mr. Speaker, I thought the Minister for International Trade answered that question very clearly. If she did not, I answered it very clearly this morning. The answer is that the Government was not informed of such activities before Mr. Casey testified before the Senate Committee. I said as well that we have expressed our concern over this state of affairs to the United States Government.


INQUIRY WHETHER PRIME MINISTER AND CERTAIN PUBLIC SERVANTS WERE INFORMED OF CANADIANS' PARTICIPATION IN SALE OF ARMS
Raymond Garneau: Mr. Speaker, the arms sale affair has been going on for a number of months. Apparently, the Department and the Secretary of State for External Affairs knew nothing about this. The Minister of State and her Department for International Trade knew
nothing. We are told an investigation is under way. I would like to ask the Deputy Prime Minister whether the Prime Minister himself was informed and whether officials now or formerly informed by him were aware of participation by Canadians in the arms sale?


Donald Frank Mazankowski: Mr. Speaker, I think there is some ruling about repetitive questions. That is the same question I answered a little earlier. I invite the Hon. Member to read Hansard.


Raymond Garneau: Yes or no?


Miss MacDonald:: He said no.


Raymond Garneau: No, he didn't say no.


Flora Isabel MacDonald: He did too.


Mr. Speaker:: Order. Order, please. The Hon. Deputy Prime Minister has made reference to rules in this place. The Chair can only comment that if the same question is asked repeatedly, the likelihood is that the same answer will be given repeatedly.


INQUIRY WHETHER PRIME MINISTER CONTACTED UNITED STATES PRESIDENT
Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, my question is also directed to the Deputy Prime Minister. Canadians have become very, very concerned about this issue because the Director of the CIA has given the impression that Canadians have indeed been involved in this very dastardly arms sale to Iran. Since the Secretary of State for External Affairs was unable to get any information from Mr. Shultz, has the Prime Minister of Canada been in touch with the President of the United States? After all, we have now known about this for two days. I assume that this is a serious enough matter that our Prime Minister would talk directly to the President.


Donald Frank Mazankowski: Mr. Speaker, again, I think I responded to that question. Certainly it is a very serious matter because Canadians are implicated. They are implicated by speculative stories which have not been confirmed. Surely the object of the matter is to try to determine the facts, to learn whether there is any foundation to this. Certainly if there is, at the appropriate time whatever representations are required will be made.


REQUEST THAT PRIME MINISTER CONTACT UNITED STATES PRESIDENT
Nelson Andrew Riis: Mr. Speaker, my supplementary question is also directed to the Deputy Prime Minister. I can think of no better way to get the
December 12, 1986

information than the Prime Minister of Canada speaking directly to the President of the United States. It is a serious enough matter. Taking into consideration the seriousness of the matter and the fact that every Canadian citizen is very concerned about the reputation of Canada and Canadians, would the Deputy Prime Minister explain why the Prime Minister of Canada has not done that? If, in fact, he has not, will the Prime Minister do it now?


Donald Frank Mazankowski: Mr. Speaker, the Secretary of State for External Affairs has discussed this matter with Mr. Shultz.


John Edward Broadbent: He got no answer.


Donald Frank Mazankowski: Mr. Shultz speaks for the administration of the United States of America.


John Edward Broadbent: But he didn't know.


Donald Frank Mazankowski: Well, I presume if he did not know anything about it, perhaps the President did not either. I am not sure of that.


Rodney Edward Murphy: Ask him.


Donald Frank Mazankowski: The fact of the matter is that those discussions and representations are taking place at a very high level. Surely the Hon. Member would not expect the Prime Minister to become involved without at least having obtained some basis and foundation as to whether the stories are true or not. That is what we are trying to do.


Nelson Andrew Riis: Not very successfully.


Donald Frank Mazankowski: We have used the mechanisms at our disposal to try to determine what is factual and what is not. The representations between the two Governments will continue.


PRESENCE IN GALLERY OF SWEDISH MINISTER OF LABOUR
Mr. Speaker:: I wish to draw to the attention of Members the presence in the gallery of the Hon. Anna-Greta Leijon, Minister of Labour for Sweden.


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


UNEMPLOYMENT INSURANCE
Jean-Claude Malépart: Mr. Speaker, my question is directed to the Minister responsible for cutting unemployment insurance benefits in Canada. Mr. Speaker, on December 5, when I asked the Minister about the study by Mr. Dickinson on the annualization of unemployment insurance programs, the Minister, and I am quoting Hansard, answered that he was not aware of the study and that perhaps it was the Forget Commission.
I have before me today this secret study that was submitted to the Government in July 1985. I would like to know why the Minister was not aware of the existence of a study that is important to the reform of unemployment insurance programs and why he did not say so at the time?


Hon. Benoit Bouchard (Minister of Employment and Immigration):: Mr. Speaker, the question of unemployment insurance, as the Hon. Member for Montreal-Sainte-Marie knows perfectly well, was examined from May or June 1985 to November 1986. During that period, dozens of documents were submitted, either to the Forget Commission directly or to the commissioners, at their request, and these studies were used by the Forget Commission in making its recommendations. The Minister of Employment and Immigration can hardly be expected to know every single document produced in the Department or at the request of commissions of inquiry on specific subjects.


RESPONSIBILITY FOR DOCUMENTS
Jean-Claude Malépart: Mr. Speaker, I have to say the Minister is not running his department. The secret study I referred to was carried out between November 1984 and July 1985, and if we look at the report on the study, it is identical to one of the recommendations of the Forget Commission. So I still wonder why today, the Minister, who is responsible for an area that is particularly important to Canadians, is not aware of this study. Who is running the Department?


Benoît Bouchard: Mr. Speaker, the trouble with the Hon. Member is that he always sees a connection between a document and the way a department is managed. Running a department involves more than being aware or not of the existence of a specific document. The document is part of a range of references the department and the Commission may use in drafting a report and recommendations on a subject that will be examined by the Government and on which we shall be making recommendations in May 1987, as I have said before.

December 12, 1986
Oral Questions


EXTERNAL AFFAIRS
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, I have a question for the Deputy Prime Minister with regard to the allegations of a possible Canadian connection to the arms sale to Iran. Can the Deputy Prime Minister inform the House that he is satisfied with the process which occurred through which we did not find out anything about this until several hours after it had become public in the United States? Does he think there should have been information given by the American Government or the CIA to Canadian officials, perhaps the Canadian Security Intelligence Service, beforehand? Is the Deputy Prime Minister satisfied with the process? After all, we are a sovereign country and an independent nation. I think we should have been informed.


Donald Frank Mazankowski: Mr. Speaker, I thought I answered that question. The answer is no. We have made our expressions of dissatisfaction to this effect to the United States.


CANADIAN POSITION
Lorne Edmund Nystrom: Mr. Speaker, since the Deputy Prime Minister said that the Government has expressed its concern to the United States, will he explain whether it has sent a letter of protest to the American officials? If not, is it planning to send a letter of protest to the U.S. officials so that this does not happen again?


Donald Frank Mazankowski: Mr. Speaker, I have said that we have expressed our concern over the way this matter has been handled. This is the fourth time I have answered that question.


CORPORATE AFFAIRS
Bill Attewell: Mr. Speaker, my question is directed to the Minister of Consumer and Corporate Affairs. I was very pleased to see the Government's concern about corporate concentration as mentioned in the recent Speech from the Throne. In an article in this week's Maclean's, the chairman of one of Canada's largest banks lashed out at corporate takeovers. What specific action will our Government initiate to examine the awesome problem of concentration of wealth in this country?


Hon. Harvie Andre (Minister of Consumer and Corporate Affairs):: Mr. Speaker, I believe it is worth pointing out that the Competition Act that was passed in June now makes it possible for the Government to annul any mergers that have a detrimental effect on competition in the market-place. Second, the Green Paper on financial institutions, written by the Minister of State for Finance, and the Standing Committee study will undoubtedly lead to legislation that will have an important bearing in the area of financial institutions. Finally, my officials are working on this subject to see if there are other changes we could make to the Canada Business Corporations Act. I understand that the Standing Committee on Consumer and Corporate Affairs is looking at corporate concentration as one of its items for study this term. I think that is an excellent idea.


UNEMPLOYMENT INSURANCE
Don Boudria: Mr. Speaker, my question is directed to the Minister of Employment and Immigration. It concerns what I understand to be a secret document, entitled "Option for Change", prepared by Mr. Dickinson. In spite of previous attempts by the Minister to divorce himself from the Forget Commission Report and the recommendation concerning annualization, will he explain the coincidence that the same annualization scheme of Mr. Forget is the one that Mr. Dickinson prepared for his Department one and a half years ago, and which is in the document that I have in my hand? Can he explain that coincidence to the House?


Benoît Bouchard: Mr. Speaker, the Hon. Member for Glengarry-Prescott-Russell never fails to be impressed whenever he spots the word "secret" on a document. It does seem to disturb him. I can only tell him what I told his colleague earlier: lots of documents are produced within the Department. As to whether there might be a coincidence or any kind of connection between this document and the Forget Commission recommendations, the Government is not called upon to do anything. It is quite possible that-I have just received the document mentioned by my colleague opposite-Mr. Forget has drawn inspiration from it, but Government policy is not involved at all. For the third time today I repeat that we will make recommendations in May, and until then we will familiarize ourselves with documents of every description, including some which are no longer secret.


REQUEST FOR EXPLANATION OF FORGET REPORT RECOMMENDATIONS
Don Boudria: Mr. Speaker, what is obvious is that Mr. Forget not only drew
December 12, 1986

inspiration from this report, but he also copied parts of it. So can the Minister tell the House how it is that a recommendation which absolutely no-one, no witness claims to have made but which originated from his Department via this report ended up among those advocated in the Forget Commission study? Why is he still trying to divorce himself from this recommendation, which happens to be his own?


Benoît Bouchard: Mr. Speaker, if I may use words with which the Hon. Member is familiar, he has been unable to uncover a connection between the document and myself, he has established a connection with Mr. Forget. If Mr. Forget saw fit to include it in his report he did not seek permission from the Minister of Employment and Immigration. He quite simply decided to use that document. As I said, we will refer to it at the appropriate time, in May next year.


EMPLOYMENT
Ms. Margaret Mitchell (Vancouver East):: Mr. Speaker, my question is directed to the Minister of Employment and Immigration. It is a myth that the wage gap for women is improving. When one examines the statistics closely, they show that full-time and part-time working women, taken together, usually earn only 57 cents for every dollar earned by men. What does the Minister intend to do about the increasing trend to low paid, unprotected part-time jobs into which increasing numbers of women are being forced? This means they are being forced into poverty.


Benoît Bouchard: Mr. Speaker, I find the question asked by the Hon. Member for Vancouver East interesting. You know that jointly with the Department of State for the Status of Women, we are examining thoroughly the whole question of women's salaries, women's income and whatever substantial efforts we want to make to improve on women's employment conditions and income.
I think that in the past two years, there have been very clear-cut improvements in the contribution of women on the labour market as well as in their income level.
However, it is obvious that we were far behind and that very few things were done before us. Moreover, we are quite encouraged at present and we will keep doing our job.


FULL-TIME JOBS FOR WOMEN-GOVERNMENT POLICY
Margaret Anne Mitchell: Mr. Speaker, since privatization, down-sizing, and contracting out, which
Oral Questions
are policies of the Government, are threatening full-time jobs particularly for women, what steps will the Minister and his colleague, the Minister responsible for the status of women, take to ensure that full-time jobs presently held by women, particularly in the federal jurisdiction, will not be lost? We are very concerned that they will be lost as a result of these federal government policies.


Benoît Bouchard: Mr. Speaker, the problem of part-time jobs is a very complex, one especially since there are some jobs available in both the private and public sectors. Many women prefer that type of employment because again it is easier for them to fit into this combination.
Now the Government is trying to implement-through job creation procedures-the employment strategy, especially women's re-entry on the labour market whenever it is possible or they want it so. We are trying to create a market for fulltime jobs but it is a step by step process.


Mr. Speaker:: Order, please. The Hon. Member for South West Nova.


FISHERIES
Mr. Gerald Comeau (South West Nova):: Mr. Speaker, my question is directed to the Minister of Fisheries and Oceans. He will know that Texaco Canada Resources is proposing to drill exploratory wells in Georges Banks, some of the world's most lucrative fishing grounds. He will further know that the fishing industry and community have expressed grave reservations about such a proposal. Will he indicate to the House his views on this most controversial subject?


Hon. Thomas Siddon (Minister of Fisheries and Oceans):: Mr. Speaker, the concern of the Hon. Member for South West Nova is obvious because the livelihood of hundreds of fishermen living in this area could well be negatively affected if appropriate precautions were not taken in regard to any drilling proposals on Georges Banks. Until I receive specific technical proposals from Texaco, and the report of the Gulf of Maine Advisory Committee which advises me on this issue, we are not prepared to approve any proposals for drilling on Georges Banks.

December 12, 1986
Oral Questions


CANADA POST CORPORATION
Alfonso Gagliano: Mr. Speaker, my question is directed to the Minister responsible for Canada Post. This morning I received a letter from Denise North of Richmond, British Columbia. The letter concerns the 29-cent stamp that was issued for Christmas and which can only be used on envelopes that have a matrix imprinted on them. This is unfair to many Canadians who already have their Christmas cards. Will the Minister tell Denise North, and thousands of other angry Canadians who cannot use the 29-cent stamp to mail their Christmas cards, why a 29-cent stamp is not like any other stamp, and why it is not available to all Canadians?


Hon. Bernard Valcourt (Minister of State (Small Businesses and Tourism)):: Mr. Speaker, the Hon. Member is referring to a program that was put in place in 1985 by Canada Post, in partnership with the Greeting Cards Association of Canada, including such groups as UNICEF. The program is aimed at using standardized envelopes which may be processed faster and in a more economical way by Canada Post. The money saved in doing this is given back to the clients of Canada Post through the offering of the 29-cent stamp. I guess it is to the advantage of Canadians who can use it.


INQUIRY WHY CREATION OF TWO CLASSES OF CITIZENS WAS PERMITTED
Alfonso Gagliano: According to the letter, Mr. Speaker, this service is not available to all Canadians and, apparently, only a few companies produce this envelope, and both the card and the envelope must be bought at the same time.
I do have a supplementary question. Why does the Minister allow Canada Post to create two classes of citizens, namely those fortunate enough to mail a Christmas card for 29 cents, and others who must pay 34 cents? Does that reflect the Canada Post Christmas spirit?


Bernard Valcourt: Mr. Speaker, I am trying to make the Hon. Member understand that envelopes are standardized under this program. They are sorted by optical scanners, so Canada Post can save money and pass such savings on to its customers.


EXTERNAL AFFAIRS
Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, my question to the Deputy Prime Minister relates to his earlier answer. He said a protest has been made to the United States with respect to this Canadian connection. What kind of protest was made?


Donald Frank Mazankowski: Mr. Speaker, I have said that the Government has expressed its concern over this state of affairs to the United States. I suppose that it was done through the normal channels.


John Edward Broadbent: You suppose?


Donald Frank Mazankowski: I am not sure just what precisely the Hon. Member is after. Is he asking me whether I protested formally or if someone did? Through the normal channels, a protest was made.


NATURE OF PROTEST
Steven W. Langdon: Mr. Speaker, a protest can take the form of a telephone call to the Ambassador, or a much, much stronger communication. Will the Deputy Prime Minister please come clean with the House and tell us at least-this information-what kind of protest has been communicated to the United States on this serious matter?


Donald Frank Mazankowski: Mr. Speaker, I will undertake to obtain for the Hon. Member the precise form of the protest, the time, the hour, the date, and who presented it, and I will report to him next week.


OFFICIAL LANGUAGES
Jean-Robert Gauthier: The
President of the Treasury Board being absent, Mr. Speaker, I will direct my question to the Deputy Prime Minister.
Yesterday, the President of the Treasury Board stated in the House, and I quote:
With respect to linguistic training, the Government is still fully aware of the need for this program. We are trying to make it more effective and more properly geared to the requirements of our employees.
December 12, 1986

Yet, Mr. Speaker, the Government announced on November 27 to civil servants and language teachers that it was planning to cut as many as 325 person-years from a total of 703 person-years, a cut of nearly 50 per cent.
How can the Government expect us to believe that it will maintain the quality and quantity of services, while cutting half of the professional staff?


Hon. David Crombie (Secretary of State):: Mr. Speaker, perhaps I could assist the Hon. Member in the absence of the President of the Treasury Board. As the Hon. Member well knows, we have under review a Bill dealing with language, which Bill may assist and meet the concerns registered by the Hon. Member.


QUALITY OF TEACHING-EFFECT OF STAFF REDUCTION
Jean-Robert Gauthier: Mr. Speaker, I will repeat my question which has nothing to do with the law pertaining to official languages. It has to do with cutting language training courses.
On November 27 the Department announced that 325 person-years would be cut from the 700 or so people who perform this training at this time. How can one entertain the idea that we will improve, as the Minister told me yesterday, the quality and quantity of teaching when half of the teachers are being cut from the system?


David Edward Crombie: Mr. Speaker, since the Hon. Member is dealing with a question which he asked yesterday of the President of the Treasury Board, I think the only thing I can do is take it as notice and advise the President of the Treasury Board when he returns to the House.


NATIONAL ENERGY BOARD FORECAST OF NATURAL GAS RESERVES
Mr. Ian Waddell (Vancouver-Kingsway):: Mr. Speaker, in the absence of the Minister of Energy, Mines and Resources I will address my question to the Parliamentary Secretary, who I am sure will be pleased to answer.
Are the Parliamentary Secretary and the Government aware that this week the National Energy Board released a report on supply and demand up to the year 2005? The report reveals what we all know, that is, we are running out of sweet light crude oil. The report also includes the stunning revelation that in 15 years-in the year 2002-we will be running out of conventional natural gas. Does the Parliamentary Secretary remember when we were told that we had 300 years' supply? Is the Government aware of this and, if so, why is it taking steps to make it easier and not more difficult to export all our good easy-to-get Canadian natural gas?
Oral Questions


Mr. Jack Shields (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, I am always pleased to answer my hon. friend's questions. The report is a good piece of analysis which will make an important contribution to the debate that is shaping up on energy policy. As the Hon. Member obviously knows, the Minister of Energy, Mines and Resources will be meeting with his provincial counterparts in a co-operative way so that they can address the very serious problems outlined by the Hon. Member.


GAS SURPLUS TESTS
Ian Gardiner Waddell: Mr. Speaker, eyes glaze over and pens drop when one asks about natural gas. These are really interesting revelations about Canada's future. Will the Parliamentary Secretary answer this question? Why is the Government removing safeguards, for example the gas surplus tests, rather than putting into place protections and policies so that Canadians will have easily accessible, cheap natural gas in the future?


Jack Wendele Shields: Mr. Speaker, certainly some of the domestic downside risks have been outlined in the report that we have received. As I say, it is a very succinct and good report. It is available for discussion by the provincial Governments and Ministers their counterpart in the federal Government. I remind the Hon. Member that he is a member of the Standing Committee on Energy, Mines and Resources and that the committee is also studying the very serious questions outlined in the report.


HOUSING
Mr. David Berger (Laurier):: Mr. Speaker, my question is for the Minister of Public Works. In reply to a question yesterday on co-operative housing the Minister said:
-we have been able to accommodate more than twice the number of households-than any other Government had been able to do in the history of Canada.
From 1981 to 1985 the co-operative housing sector built 5,500 units per year. If the Minister's program is so great will he tell us why not one single unit of co-operative housing has been built this year?


Hon. Stewart Mclnnes (Minister of Public Works):: Mr. Speaker, I would ask the Hon. Member to review my answer. The reply concerning the large number of accommodations was in general and not peculiar to the co-op program. The second part of my answer was relative to the co-op program. The program is new. It took a long time to work it out with the provinces. It is now in place and progressing well.

December 12, 1986
Oral Questions


INQUIRY WHETHER PROGRAM WILL BE AMENDED
David Berger: Mr. Speaker, the Minister has recognized yesterday that there were problems in connection with this program. Could he give us immediately the assurance that it will change the program to guarantee a minimum of 5,000 units per year and allow low income families which are in need of a minimum assistance and who are now excluded from this program to participate?


Stewart Donald McInnes: Mr. Speaker, the co-op program is a market oriented program with a provision to include some lower income families. We have programs to accommodate those in need. They are outside the co-op program.


Hon. Tom Hockin (Minister of State (Finance)):: Mr. Speaker, according to statistics I have seen, in the first six months of 1986 the lifetime capital gains exemption has created $3.2 billion worth of new investment in the small business sector alone.


Some Hon. Members:: Hear, hear!


Some Hon. Members:: Table it.


Thomas Hockin: The Investment Dealers Association tabled that report last month as the Hon. Member would know if he read it. As a result of that, thousands and thousands of people have been put to work, particularly in small businesses.

[ Translation]


TRANSPORT
Mr. Mike Cassidy (Ottawa Centre):: Mr. Speaker, my question is for the Minister of State for Finance. We have learned that the Income Tax Act which will be coming before the House again allows capital gains covered by the lifetime capital gains tax exemption to be exempted from the alternative minimum tax. Can the Minister explain why wealthy Canadians should not pay minimum tax on capital gains and why the Government is giving this Christmas gift to the rich when unemployed Canadians have no pay cheques to look forward to at Christmas?


Thomas Hockin: Mr. Speaker, the Hon. Member has stated only half of the situation. For the purpose of calculating the alternative minimum tax, capital gains will be put in income at the full rate and not be given the 50 per cent deduction. The alternative minimum tax will be calculated after that. The division in half of capital gains which ordinary people can do will not occur under the alternative minimum tax.


MINIMUM TAX CALCULATION
Michael Morris Cassidy: Mr. Speaker, the Minister is telling us that capital gains will get special treatment and if taxed at all will be taxed at half of the minimum tax rate for everything else. Why do the deductions from income in calculating the minimum tax allow people deductions when they have taken the vow of perpetual poverty, made charitable donations and paid medical expenses and, lumped in with those things which are socially worth while, provide another exemption so that people will pay less on capital gains? What kind of gift is that?


Hon. Andre Ouellet (Papineau):: Mr. Speaker, I have a question for the Deputy Prime Minister. Could he inform the House why his Government has yet to authorize VIA Rail to purchase the rolling stock it so badly needs if it is to provide an adequate service to railway passengers?


Donald Frank Mazankowski: Mr. Speaker, I know that the Minister of Transport is seized with that particular issue. As the Hon. Member knows, when I was Minister of Transport I tried to work out an arrangement with the consortium whereby procurement could be made at an affordable level. Those negotiations had gone on for some time and my sense is that the matter is still being considered by the Minister and his cabinet colleagues.


REQUEST THAT MINISTER APPEAR BEFORE COMMITTEE
André Ouellet: Mr. Speaker, I thank the Deputy Prime Minister. I know that he was very committed to transport but I have the feeling that his successor is not, as he has not yet appeared before the Standing Committee on Transport. Can I have the assurance of the Deputy Prime Minister that indeed the Minister of Transport will appear very soon and answer positively to the request of the Chairman of the Transport Committee to appear before the committee to explain the situation?


Donald Frank Mazankowski: Mr. Speaker, first and foremost let me point out that the current Minister of Transport is as vigorous and active in pursuing good Progressive Conservative government policies in transport as I was, and perhaps he is doing a better job at it. Perhaps that is why he does not have to appear before the committee.
December 12, 1986


STATUS OF WOMEN
Mr. Sid Fraleigh (Lambton-Middlesex):: Mr. Speaker, my question is addressed to the Secretary of State. There is a great deal of concern on the part of many Canadians about what they perceive as being discrepancies in the funding of women's groups. I might add that it is a perception that is shared by myself and a good many of my colleagues. When will the Minister resolve this contentious issue?


David Edward Crombie: Mr. Speaker, the process we use at the Department of Secretary of State for the assessment of all applications is a just and fair one, and I expect to continue that process.


CANADA POST CORPORATION
Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, the Canadian public relies on its national magazines to bring it national and world news from a Canadian perspective. These magazines, including Maclean's and Saturday Night, are key to keeping Canadians aware of news from their own perspective but the financial viability of these magazines will be at risk if their Canadian postal subsidies are reduced.
My question is directed to the Deputy Prime Minister. Does the Deputy Prime Minister want Canadians to read Canadian news from a Canadian perspective? If the postal subsidies are removed, that will not happen. Will the Deputy Prime Minister keep the postal subsidies for Canadian magazines?


Flora Isabel MacDonald: Mr. Speaker, the Canadian publishing industry is vital to the existence of this country and will continue to be so. The entire question of postal subsidies and the postal corporate plan has been reviewed by a Parliamentary Committee of the House. I would trust that the Hon. Member would allow that Parliamentary Committee to report.


COMMITTEE RECOMMENDATION
Sheila Finestone: Mr. Speaker, the Parliamentary Committee to which the Minister has just referred has suggested that postal rates be cut. That would put Canadian magazines into jeopardy. Does the Minister agree with jeopardizing Maclean's, Saturday Night and Canadian readers?


Flora Isabel MacDonald: Mr. Speaker, I wonder if the Hon. Member understood what she said. She said that the committee has just recommended that postal rates, and I suppose postal rates of all classes, be cut.
Privilege-Mr. Cassidy
Perhaps she would allow the House in its entirety to examine that report.


IMMIGRATION
Mr. Gerry St. Germain (Mission-Port Moody):: Mr. Speaker, I have a supplementary question on immigration directed to the Minister of State for Immigration. Has the Minister come up with a solution or a way of handling the situation of the ruling made by the Immigration Appeal Board in British Columbia? Is he prepared at this time to carry out a further appeal, possibly to the Federal Court of Canada, on this very important issue?


Hon. Gerry Weiner (Minister of State (Immigration)):: Mr. Speaker, it is clearly under IAB jurisdiction. No matter how repugnant the activities of this individual, he has certain legal rights. We are within the appeal period and there is definitely an appeal based on error in law.


PRIVILEGE
Mr. Speaker:: The Chair will now make a ruling on a matter raised on December 1 by the Hon. Member for Ottawa Centre (Mr. Cassidy). The Hon. Member presented a well reasoned argument relating to the legislation recently adopted to permit the takeover of the Bank of British Columbia by the Hongkong Bank. He also provided me with additional information by way of documentary material. I thank him for so doing.
The Hon. Member alleged that during the debate on the legislation in this House, certain information was withheld. He also complained that information which had been provided to a committee of the other place had not been made available to this House. The Hon. Minister of Finance (Mr. Wilson) assured the House that no information was intentionally withheld. We are therefore faced with an argument as to whether information was withheld or not.
The Hon. Member for Ottawa Centre, together with certain other Hon. Members, feel that they have a grievance because, having co-operated in expediting the passage of the legislation in question, they were not as fully informed of the facts as they should have been. The Hon. Minister of Finance does not accept that the grievance is well founded. He maintains that Ministers dealt with all questions raised in committees of both Houses and indicated that his colleague would be prepared to

December 12, 1986
Point of Order-Mr. Weiner
appear before the Finance Committee to answer further questions.
The situation is one that is familiar in this House. Some Hon. Members believe they have a grievance and, as a result, there is a dispute. However, grievances and disputes do not constitute questions of privilege. They are matters of debate. I cannot find, therefore, that the matter complained of by the Hon. Member for Ottawa Centre has any relevance to parliamentary privilege.
I would like to add that the point raised by the Hon. Member for Ottawa Centre is a legitimate one in the sense that it is of very great importance for a Government to make availalble to all Hon. Members working on committees the same information that is available in other places. I thank the Hon. Member for Ottawa Centre for his intervention.


POINTS OF ORDER
Gérard (Gerry) Weiner: Mr. Speaker, I rise on a point of order. In my response I did not wish to mislead the House. What I wished to indicate clearly was that we are within the appeal period, and that there is an appeal possible on error in law. I did not wish to indicate that we were necessarily appealing, but it is something that the officials may wish to look at. I wish there to be a clear indication that there is a possibility only on the error in law.


Mr. Speaker:: The Hon. Minister has properly brought this information to the House. The Chair would remind all Hon. Members that under our long tradition of the rule of law, all of us must be careful in what is said with respect to a case that is presently before a judicial or quasi-judicial tribunal, a court, or a case that may be appealed. I thank the Hon. Minister for his comments.


CORRECTION TO QUESTION
Sheila Finestone: Mr. Speaker, I rise on a point of order. During the course of my questions to the Minister, I used the term "postal rate" instead of "postal subsidy" when referring to the funds from the Department of Communications. I wish to change the word with respect to the cut from "postal rate" to "postal subsidy".


Mr. Speaker:: The Hon. Member has noted a distinction which is profound, and which sometimes escapes all Hon. Members and the Canadian public.



ROUTINE PROCEEDINGS


Bill Attewell: Mr. Speaker, I have the honour to present in both official languages the third report of the Standing Committee on Finance and Economic Affairs in relation to Bill C-23, an Act to amend the Income Tax Act and a related Act, with amendments.
[Editor's note: See today's Votes and Proceedings.]


PETITIONS
Michael Morris Cassidy: Mr. Speaker, I have the honour to present a petition signed by a group of Canadians from the Province of Quebec, who are asking the Government to have Parliament reject the proposals that will increase the price of drugs for Canadian men and women, and who are opposed to the Bill introduced by the Canadian Government that will change the patent system for drugs.


Michael Morris Cassidy: I also have a petition which is signed by a number of citizens of my Province of Ontario who are very concerned about low-level flight training of pilots of NATO countries at the Canadian Forces Base in Goose Bay, Labrador, and who humbly pray and call upon Parliament to ensure that the Prime Minister (Mr. Mulroney) ends all low-level flight training at the Goose Bay Forces Base, and cease negotiations with NATO for establishment of a larger base there.


Mr. Gus Mitges (Grey-Simcoe):: Mr. Speaker, it is a pleasure for me to present and support a petition on behalf of the congregation of the Meaford United Church, Meaford, Ontario, in my riding of Grey-Simcoe who participated in the Prayer for Peace Service, and who have now delivered their personal petition for peace to the House of Commons to ensure that all government levels continue to work for peace and harmony throughout the world.


Constantine George (Gus) Mitges: I am pleased to present and support a petition from the residents of Stayner, Ontario and surrounding area in my riding of Grey-Simcoe who protest in the strongest terms the action of the Chairman of Canada
December 12, 1986

Post who unilaterally has unfairly denied second-class mailing privileges to the Presbyterian Record, the national magazine of the Presbyterian Church of Canada.
This action will raise the monthly mailing costs from $3,600 to $17,000 which is prohibitive. The petitioners call upon the Government to intervene and reverse this unfair decision.


Jean-Robert Gauthier: Mr. Speaker, I have 10 petitions signed by hundreds of Canadians who humbly submit to the House that the Government of Canada has imposed a retaliatory tariff on imported books in the English language which has limited the access of Canadians to literature and information. The tariff has had little negative effect on the publishing industry in the United States, yet it penalizes Canada's consumers, book publishers, book sellers, distributors and Canada's culture. Rising book prices have placed a strain on the book acquisition programs and policies of our nation's public and specialized libraries.
The undersigned petitioners humbly pray and call upon Parliament to rescind this tariff which threatens to do irreparable harm to the Canadian book industry and compromises federal policy on cultural industries in respect to free trade negotiations. This petition is humbly submitted.


Victor Fredrich (Vic) Althouse: Mr. Speaker, I have some petitions that have been sent to me by citizens in Ontario who point out that in their opinion the training of pilots at Goose Bay to fly under the radar into eastern Europe is a provocative and aggressive war-fighting action that tends to endanger world peace.
The petitioners therefore call on Parliament and the Prime Minister (Mr. Mulroney) to end all low-level flight training at Goose Bay, and to cease negotiations with NATO for the establishment of a larger base there.


Margaret Anne Mitchell: Mr. Speaker, I have several petitions. The first one is from a number of people in the greater Vancouver region who are very concerned about the relocation of dangerous goods transfer points into Vancouver east. The petitioners call upon the House to order the Canadian Transport Commission to immediately relocate the transfer of all hazardous commodities to a location outside the inner harbour of Vancouver, and further, that a permanent solution is finalized to the movement of hazardous commodities which will be acceptable to the citizens of greater Vancouver.


Margaret Anne Mitchell: The next petition is from citizens in Burnaby and New Westminster. It calls
Petitions
upon the federal Government to reject proposals that are contained in the proposed changes to the Patent Act that will impose high drug prices on Canadian consumers, and will be particularly unfair to senior citizens.
The second petition on the same subject is from citizens in Coquitlam, North Vancouver, North Delta, and Langley.


Sheila Finestone: Mr. Speaker, I rise once again to protest the tax on reading and to ask the Minister of Finance (Mr. Wilson) to stop finding reading so taxing. I have received hundreds more petitions in my office from your humble servants who wish to ask you to plead with the Government of Canada to rescind the retaliatory tariff on imported books in the English language limiting the access of Canadians to literature and information. This tariff has had little negative effect on the publishing industry of the United States, yet it penalizes Canada's consumers, book publishers, book sellers, distributors, and Canada's culture. I hope that the Minister of Communications (Miss MacDonald) is listening. Whereas, rising book prices have-


Mr. Speaker:: Order, please. The Hon. Member for Mount Royal (Mrs. Finestone) was hoping that the Minister was listening. I have to advise her that the Chair is also listening and the Hon. Member is going on too long.


Sheila Finestone: May I deposit these, Sir?


Mr. Speaker:: The Hon. Member has presented her petition, and the Chair thanks the Hon. Member for the petition and the intervention.


Mr. Andrew Witer (Parkdale-High Park):: Mr. Speaker, I am honoured to present to the House a petition on behalf of Parkdale-High Park residents, and to add my endorsement to their call for the House of Commons to intervene and effect a return of their mailboxes, some 700 of which have been removed from Toronto neighbourhoods in recent months. The names on this petition represent residents in my constituency on Springhurst, Spencer, Jameson, Close, and Cowan avenues who have been affected by these removals.


Mr. Dan Heap (Spadina):: Mr. Speaker, I have the honour to present a petition from residents of Spadina who also complain about the removal of letter boxes and the great inconvenience which will be caused, especially to the elderly and the young, in crossing dangerous streets to go to farther away boxes.
They call upon Parliament to ensure that these boxes will be replaced and that Canada Post will not remove the boxes again until it has consulted with the communities affected.

December 12, 1986
Introduction of Bills


Daniel James Macdonnell Heap: Mr. Speaker, I also have the honour to present a petition from a number of people in the Province of Ontario who object to the Government's current legislative attempt to change the Patent Act in a way which will cause unnecessary increases in drug prices. They point out that it will hurt low-income people and people on fixed incomes, and that it is an unnecessary concession to Americans in the matter of free trade. They call upon Parliament to reject these proposals on account of the increase which will injure Canadians without any assured benefit.


Daniel James Macdonnell Heap: Mr. Speaker, I also have a petition from a number of people in Toronto, Dartmouth, and Halifax, Nova Scotia, objecting to the present low-level flight training of pilots of NATO countries at the Canadian Forces Base in Goose Bay, Labrador, because it disrupts the way of life of native people there who have better ways to earn a living than by being servants on the base.
It also is a provocative act in that it relates to the possible bombing of the Soviet Union by low-level flights. Therefore, the undersigned ask Parliament to ensure that the Prime Minister (Mr. Mulroney) will end low-level flight training at the Goose Bay Canadian Forces Base and cease negotiations with NATO for the establishment of a larger base there.


Mr. Les Benjamin (Regina West):: Mr. Speaker, I have the duty and privilege to present a petition containing dozens more names from Senior Power in western Canada. They present a grievance which is common to them, in the certain assurance that this honourable House will therefor provide a remedy.
They petition the Parliament of Canada to reject proposals to amend the Patent Act which will increase prescription drug prices for Canadians.


Mr. Dennis H. Cochrane (Moncton):: Mr. Speaker, it is my duty and privilege to present to the House a petition signed by a number of constituents in southeastern New Brunswick, particularly workers at the CN shops. It outlines the CN proposals with regard to the facility and urges the Government to postpone any decision by CN to close the shops until the workers have had an opportunity to appear before the Transport Committee of the House of Commons.


Nelson Andrew Riis: Mr. Speaker, it is my pleasure and indeed honour to present a petition on behalf of a large number of constituents who again ask the federal Government to reconsider its plans to change the Patent Act relating to prescription drugs. They say it will
increase drug prices for Canadian consumers and will severely restrict the ability of average Canadians to buy necessary prescription drugs.
They also suggest that the proposed measure will unfairly hurt those Canadians whose health needs require the purchase of prescription drugs on an ongoing basis. They suggest that the proposals will also result in higher costs to provincial government drug plans, and that it is another example of the Canadian Government's concession to the United States at the expense of average Canadians during free trade negotiations.
They are simply asking the Government to reject the proposals affecting the Patent Act which will increase prescription drug prices to all Canadians.


Mr. Roland de Corneille (Eglinton-Lawrence):: Mr. Speaker, it is my privilege to present a petition on behalf of petitioners from the area of Toronto. They are deeply concerned about the policy of the Government in terms of the tariff on Canadian books, the limitation on the publication of Canadian books.
I wish to present this petition on their behalf and to point out that the Government's retaliatory tariff on imported books in the English language has limited the access of Canadians to literature and information and, therefore, endangers our culture and our economic well-being.


Mrs. Claudy Mailly (Parliamentary Secretary to Minister of Communications):: Mr. Speaker, on a point of order.
The Hon. Member who just presented a petition referred to a tariff on Canadian books, but I think the tariff only applies to American books.


The Acting Speaker (Mr. Paproski):: There is no necessity to comment upon petitions.
Introduction of Bills. The Hon. Minister of Justice, stand; the Hon. Minister of Justice again, stand; the Hon. Member for Hull-Aylmer, stand; the Hon. Member for Nickel Belt, four times, stand; the Hon. Member for Hastings-Fron-tenac-Lennox and Addington, stand-


Jean-Robert Gauthier: What is this "four times"?


The Acting Speaker (Mr. Paproski):: Four times for the Hon. Member for Nickel Belt.


Jean-Robert Gauthier: Four Bills?


The Acting Speaker (Mr. Paproski):: Yes, four Bills. If there are four in the name of the same individual, I do not see any reason I should have to do it four times, just to expedite the business of the House.
December 12, 1986


Jean-Robert Gauthier: Mr. Speaker, I just want to caution the House. If we accept that procedure, an Hon. Member may not be ready to proceed with his first Bill but may be ready to proceed with his second Bill. Therefore, if they are grouped together, they are all stood together.


The Acting Speaker (Mr. Paproski):: I understand that, and I am sure the House understands it. The Hon. Member for Saskatoon East, stand; the Hon. Member for Peace River, stand; the Hon. Member for Edmonton West, stand; the Hon. Member for Kamloops-Shuswap, stand; the Hon. Member for Kamloops-Shuswap, stand; the Hon. Member for Kamloops-Shuswap, stand; the Hon. Member for Kamloops-Shuswap, three more times, stand; and the Hon. Member for Nickel Belt, stand.



LIAISON


Donald Frank Mazankowski: Mr. Speaker, there have been prior discussions, and I think Your Honour would find disposition on the part of Hon. Members opposite to accept unanimously the following motion. I move, seconded by the Hon. Minister of State for Immigration (Mr. Weiner):
That, notwithstanding any standing or special order of the House, quorum on the liaison committee be reduced to 10 from 15.


The Acting Speaker (Mr. Paproski):: The House has heard the terms of the motion.


Nelson Andrew Riis: Mr. Speaker, I should like to confirm what the Hon. Government House Leader has just said. There have been considerable consultations, and I believe there is unanimous support for the motion.


The Acting Speaker (Mr. Paproski):: Is it agreed and so ordered?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Mr. Doug Lewis (Parliamentary Secretary to Deputy Prime Minister and President of the Privy Council):: Mr. Speaker, the following questions will be answered today; Nos. 35 and 39.
Order Paper Questions


Mr. Graham: In the past ten years, did Mr. Pierre Berton receive any government grants and, if so, in what amounts?


Philip Derek Lewis: No.


Mr. Gauthier: 1.	To the knowledge of the government, do Heritage Canada, Heritage Ottawa, the Canadian Institute of Urban Planning and 15 other community associations fear that the construction of high rise buildings in the Byward Market area will destroy its historical character, increase traffic and block the sun from shining upon this 150 year old market and, if so, will the government invite the National Capital Commission to take a position in the matter as soon as possible?
2.	Is the NCC one of the principal landlords in the Byward Market area and, if so, will the Commission act as a good corporate citizen by blocking the construction of a 17 storey hotel which would destroy the Market's historical heritage?


Stewart Donald McInnes: 1. The Government is aware of the concerns of the numerous groups opposing this project, including those listed above, and the various impacts that this development may have on the area.
The National Capital Commission has made its position known to the Mayor of Ottawa and Council in proposing to support the city of Ottawa in reviewing building heights on the north side of Rideau Street.
There is now reason to believe that the issue will be resolved at the municipal level.
2. As a good corporate citizen and major land owner in this key urban area, the National Capital Commission is cognizant of the fact that the mandate and planning for the Byward Market properly rests with the host municipality, the city of Ottawa. Nevertheless, the Commission shares many of the concerns expressed by some of the organizations noted. In fact, in its plan for Canada's capital, the Commission has identified the Byward Market as a special interest area due to its contribution to the image of the capital. Consequently, the Commission has offered professional assistance to the city of Ottawa if the city wishes to study possible height restrictions in the area, including not only the project site in question, but on the entire block between Dalhousie Street, Rideau Street, Sussex Drive and George Street.


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


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


Some Hon. Members:: Agreed.
2062

December 12, 1986
Business of the House


BUSINESS OF THE HOUSE
Donald Frank Mazankowski: Mr. Speaker, before we proceed to Orders of the Day, I might advise that the first item of business to be called will be Bill C-3, an Act to amend the Radio Act, standing in the name of the Minister of Communications (Miss MacDonald). My understanding is that there have been discussions and indeed there has been agreement to proceed with this particular piece of legislation through all stages in the House, that is, second reading, Committee of the Whole, report stage and final reading today. I think if you put that proposal to the House you will find that there is unanimous agreement to adopt that course.


Sheila Finestone: There is no agreement with that.


Nelson Andrew Riis: Mr. Speaker, there have been discussions that Bill C-3 would be introduced at second reading then we would go to Committee of the Whole, report stage and third reading so that if there were views and concerns that Hon. Members wanted to put, and if there were amendments Hon. Members wanted to put at report stage, that opportunity would be available. I know in the discussions that we had with the Government House Leader that was the agreement, but perhaps there have been some other problems. From the interjections that I have heard it appears there is some concern that there might not be an opportunity to debate or to put on the record various points or to suggest amendments. That certainly is not the case. Those opportunities will be provided.


Donald Frank Mazankowski: Mr. Speaker, clearly that is my understanding. I thank the House Leader for the New Democratic Party for that observation. There were discussions and there was an agreement with the House Leaders at a meeting yesterday. I just want to remind the Hon. Member for Kamloops-Shuswap (Mr. Riis) that we in no way want to limit or prevent the Hon. Member for Mount Royal (Mrs. Finestone) from making her points of view and debating all stages of the Bill. We are seeking an agreement to proceed with all stages of the Bill in the House rather than referring it to the committee.


Jean-Robert Gauthier: Mr. Speaker, I apologize. I was not informed of any agreement to proceed with all stages at this time. I take it our critic, the Hon. Member for Mount Royal (Mrs. Finestone), has strong views on the question and was not informed either. Therefore, I have to reserve my position for now. I am not saying this is final, but until I have some consultations with the Hon. Member for Mount Royal.


Donald Frank Mazankowski: Mr. Speaker, could I ask the Hon. Member for Ottawa-Vanier (Mr. Gauthier) whether he would agree to proceed with this measure on second reading and reference to Committee of the Whole? Would he agree to that?


Jean-Robert Gauthier: Mr. Speaker, I think it would be an advantage to proceed with second reading at this time and then we will see in the course of debate how it evolves and if we can change it.


Nelson Andrew Riis: Mr. Speaker, just so that there is no misunderstanding at all, we are now going to conduct second reading. Presumably there is an assumption that since we are making a special arrangement through mutual consent to deal with Bill C-3 potentially at all stages today, not necessarily, we are also agreeing that amendments, where appropriate, would be considered as well.



GOVERNMENT ORDERS


Flora Isabel MacDonald: that Bill C-3, an Act to amend the Radio Act, be now read a second time and referred to a Legislative Committee.
She said: Mr. Speaker, I am very pleased to be presenting this Bill for debate today. I may say in looking at it that one could say it is a modest little Bill. Nevertheless, embodied in its intent and proposals are certain more basic assumptions.
Bill C-3, an Act to amend the Radio Act, will help in promoting economic renewal by ensuring financial equity and prudent administration of a very vital government service, that is, spectrum management, which provides for the effective operation of our telecommunications network and broadcasting system, and helps our enterprises to become and remain competitive.
At the same time, Bill C-3 will promote social justice by ensuring that through licence fees the costs of planning and managing the radio spectrum are shared equally among its direct beneficiaries and not borne by the general taxpayer. In other words, the people who use this service would pay for it, not the general taxpayer. The legislation will eliminate the exemptions that public sector spectrum users now enjoy from licence fees. These exemptions are unfair, since those who enjoy them often compete with private sector users who must pay licence fees.
In this electronic age, the capacity of businesses to offer services competitively often depends upon their ability to communicate quickly and efficiently. This ability depends, in turn, upon a high quality, interference free, radio frequency spectrum. The spectrum is what you might term an invisible resource, but the services which depend on it have clearly visible benefits.
Radio and television entertain and inform. Microwave and satellite facilities give us access to each other and to the world. We can be more confident of safety in the air and at sea
December 12, 1986

because the spectrum is managed effectively to permit reliable radio navigation, air traffic control, radar and two-way voice and data flow. Mobile radio on land ensures a quick response in emergencies, safety on construction sites and in frontier exploration, and efficient and economical movement of people, goods and information. Simply put, Mr. Speaker, use of the spectrum can save time, money and lives.
Since 1912 we have seen the limits of the usable spectrum expand hundreds of thousands of times. Expansion of the usable spectrum has not resulted from some physical accident. It has not come about just by chance. Rather, it has been made possible through the development and mastering of technology that exploits the particular characteristics of each of its parts. Technological innovations such as digital transmission, trunking and cellular technologies have also served to expand the capacity of the spectrum.
In addition to increases in the uses of the air waves, we have also seen vast increases in the number of users. In the past 40 years the number of radio licences in force in Canada has risen over 100 times to three-quarters of a million in 1986. In only 20 years the number of mobile radio stations alone has grown from 60,000 to over a half a million, not including the 355,000 stations licenced in the general radio or CB service.
The Government of Canada, through the Department of Communications, is given the task of ensuring the orderly development and management of the spectrum in Canada. This involves assigning appropriate positions on the spectrum to particular uses and setting corresponding equipment standards.
International agreements are often required to ensure that our spectrum needs are met. These require extensive planning and negotiation with other countries. Domestic regulatory action is also taken to ensure that the spectrum resource is shared equitably among all Canadians. The role of the Government, quite simply, is to allow as many Canadians as possible ready access to a high quality radio spectrum and all its benefits.
Technology has responded to the challenge of mastering the properties of previously unusable portions of the spectrum in order to open them up for practical use. There are new challenges, however, to which a purely technical response is inadequate. We are being called upon to manage, with fewer resources, a radio communications environment made ever more complex by new applications which marry telecommunications and computer technologies. These include digital data, mobile radio and intra-building communications. We are committed to greater efficiency and cost control. The number of person-years devoted to spectrum management has been reduced and is now less than it was 10 years ago, despite sizable increases in the licensed population.
Nevertheless, we are also committed to cost recovery. Bill C-3 has been developed to ensure that legislation affecting the
Radio Act
management and use of the spectrum in Canada is an effective tool serving government efforts to maintain the quality of, and accessibilty to, an increasingly crowded spectrum. Our objective is to recover the full cost of this management effort from all its beneficiaries. We wish to remove the exemptions that now apply to certain users and to create, through legislative reform, a more equitable environment for all spectrum users, large or small, public or private.
We have changed the radio licence fee structure significantly since 1984. Radio licence fees were increased substantially for private sector users two years ago. This was in accordance with the principle that the cost of planning and managing the spectrum resource should be borne by the beneficiaries of that effort and not by general tax revenues. Further regulatory revisions, introduced on April 1, 1986, served to make the licensing process and fee structure more responsive and equitable, a step in the regulatory reform process to which this Government is commmitted. I can report that no further general increase in licence fees is now required. Private sector users in Canada are carrying their fair share of the cost of spectrum management. However, under the current Radio Act, public sector users are not.
Public sector radio users have long enjoyed fee exempt status. Over the years this has resulted in regional and sectoral inequities. Public utilities in some parts of our country do not pay radio licence fees, while similar utilities in other parts of Canada do indeed pay. Private sector companies who pay radio licence fees are often in competition with public sector companies who do not. For example, we now have a situation where Alberta Government Telephones, an Alberta Crown corporation, competes head to head with Cantel, a private company, in the delivery of cellular mobile telephone services. Exempting government users from paying licence fees is clearly inequitable. It is also poor management. This change will spread radio licence fees evenly across Canada among 140 provincial government departments and agencies and 40 federal government departments and agencies. The total dollar value is in the order of $10 million based on available data. Government organizations which make only light use of the spectrum should be encouraged to release licences, and thus scarce spectrum resources, for other users. However, the present system creates no such incentive.
Bill C-3 would redress these problems. It would correct the regional competitive imbalances which have crept into the radio licensing system. It would ensure that all users of the spectrum pay their fair share. Its passage would result in more prudent management of government resources. The radio spectrum is a limited resource and is managed for the benefit of all Canadians no matter where they live. The Bill is intended to respond to the new reality of communications in Canada, a reality characterized by a reliance upon competitive forces and equitable management of national resources.
Fairness and equity, cornerstones of this Government's regulatory reform strategy, will be well served by Bill C-3. The common property nature of the spectrum resource requires

December 12, 1986
Radio Act
that it be managed with efficiency and every possible application of equity. It is not only reasonable that all those who benefit from government management of the radio spectrum resource should bear an appropriate portion of the cost. Our commitment to fairness and equity requires it.


Sheila Finestone: Mr. Speaker, I am pleased to have this opportunity to speak on Bill C-3, an Act to amend the Radio Act and bring fairness and equity across the spectrum governed by this Act. Although the Bill is only a few lines long we should not be lulled into believing it is not important. It is very important. If passed in its present form it will have important ramifications for those government institutions which utilize radio frequencies for communication purposes.
At the present time the federal Department of Communications is charged with the responsibility of setting the rules for those who wish to use the radio spectrum in Canada for purposes other than broadcasting to the public. The Department regulates these users by means of a licence to operate at a certain frequency and power in a certain place so that there is no interference with others using the spectrum. In short, the Department is concerned with spectrum management. It is an onerous responsibility, not obvious to the ordinary Canadian, but one which impacts on the safety of their every day lives.
This is not the first time this Bill to amend the Radio Act has been introduced by the Government. During the last session of Parliament the previous Minister of Communications introduced for first reading Bill C-126, which was identical to this Bill. That Bill died on the Order Paper when the Government chose to prorogue. Why would the Government choose to introduce such a Bill on the next to last day before it prorogued? The only logical answer seems to be that it lacks a sense of timing and direction in its legislative agenda. If cost recovery is the goal it should have legislated on time.
Bill C-3 establishes a user-pay principle. Current provisions of the Radio Act exempt federal and provincial government departments and agencies, as well as certain Crown corporations, from paying radio licence fees. Bill C-3 would remove that exemption. As a result, those government departments and agencies would pay the same licence fees as a private sector user. That strikes me as being fair and equitable.
Opposition Parties are sometimes accused of being too negative in their approach to legislation introduced in Parliament. I would like to begin by highlighting some of the positive aspects of this Bill and indicating why I am in accordance with it.
The positive feature of charging government departments for radio licences is that those departments may be forced to reconsider whether they really need to occupy a radio frequency. Charging an entity for a service which has previously been provided free may force the entity to reconsider the need for the service in the first place and to become more efficient
managers. Therefore, it is possible that some Government agencies which currently hold licences but make minimal use of radio frequencies may decide to surrender those licences. As a result, a number of frequencies may be freed up for users. As the Minister pointed out, there has been tremendous growth in this sector and there is a need to free up frequencies.
The second positive aspect of Bill C-3 is that the revenues generated from the new fees to be charged to government agencies should enable the Department of Communciations to recover fully the cost of operating its radio frequency spectrum branch. Therefore, the radio frequency spectrum branch of the Department would no longer be a drain on the federal Treasury but would become fully self supporting. I certainly support that initiative.
With respect to the private sector fee increases, Bill C-3 should also please those in the private sector who have to date been paying licence fees to support the operations of the radio frequency branch of the Department of Communcations. I understand that for the year 1985-86 private users received a very hefty increase in licence fees. I am sure these users will have a sense of relief, fairness and equity at the prospect that government users of radio frequencies will now be bearing a fair share of these costs. By placing private users and government users on the same footing, Bill C-3 will reduce one advantage previously enjoyed by government, namely, the exemption from radio licence fees. For example, when a Crown corporation such as Petro-Canada communicates through radio frequencies with its drilling rigs, the corporation will now be assessed licence fees on the same basis as would a private oil company such as Texaco.
I understand that the Crown corporation known as Alberta Government Telephones has been exempt to date from paying licence fees with respect to its cellular telephone operations. The Minister alluded to that in her speech. Yet, private firms competing with Alberta Government Telephones in the same cellular telephone market have been paying radio licence fees. Bill C-3 should eliminate this particular cost advantage enjoyed by a company such as Alberta Government Telephones.
The concern I have with regard to that is that there may not be a full understanding and appreciation of the impact of these costs to Alberta Government Telephones. According to the new fee schedule which I received from the Minister's Department, this will cost Alberta Government Telephones $1,089,122. In addition, the Saskatchewan Power Corporation will be charged $59,000. In her speech the Minister indicated that Ontario pays fees while Quebec does not. The cost to Hydro-Quebec will be $437,352. The Nova Scotia Power Corporation will pay $41,180. The New Brunswick Electric Power Commission will pay $26,000. Newfoundland and Labrador Hydro will pay $25,000 and B.C. Hydro will pay $210,790. These are large sums of money. The total for the Saskatchewan Telecommunications Network will be well in
December 12, 1986

excess of half a million dollars. The Government of Saskatchewan will have to pay $695,522. The cost to the Manitoba Telephone System will be close to half a million dollars.
With those amounts of monies involved, I feel very strongly that the views of the hydro companies, telecommunciations industries and the governments upon which this will impact should be heard. For that reason I think that this Bill, although it consists of only three lines, should be examined quite carefully. The people who will be impacted should have an opportunity, through the Government's consultative mechanisms, to know exactly what the result of this Bill will be. I was informed by the Department of Communications of the amount of money involved with respect to licence fees. I hope the Minister's Department was in communication with the Departments impacted in order that they would be aware of the effect on them.
I have listed some of the positive aspects of Bill C-3, but my Party would not be doing its job as the Official Opposition if we did not point out some of the problems which we perceive the Bill may create.
One example is Section 2(3) of the Radio Act. It should be pointed out that while Bill C-3 purports to amend Section 2(2) of the Radio Act, the Bill leaves Section 2(3) of that same Act in place. Section 2(3) gives the federal Cabinet the power, on the recommendation of the Minister of Communications (Miss MacDonald), to exempt a federal Government radio frequency user from the provisions of the Radio Act itself. The Cabinet cannot exempt a provincial Government user.
One of the objectives of Bill C-3 is apparently to provide for equality of treatment among all users of the spectrum, be they federal Government, provincial Government, or private sector. Even the Department of Communications itself will have to pay radio licence fees.
Having provided for this equality in Bill C-3, I trust that, unless the Minister of Communications has very strong reasons for doing so, she will not proceed to recommend to Cabinet the exemption of federal agencies from the Radio Act, for to do so would be to remove the equality of treatment which we are told the Bill is intended to provide. If there is no indication of this in the Bill through amendment or the inclusion of some change in Section 2(3) of the Radio Act, there is no way of assuring provincial Governments and hydro electric companies that they will never be subject to an Order in Council which could change the rules of the game, which is allowed under Section 2(3) of the Bill. I think the Minister should consider that. I want to discuss that in committee when the Bill is before it.
Although the Government indicates that the fees to be charged government users under the Bill will be calculated on the same basis as the fees already assessed to the private user, Bill C-3 does not so provide. Rather, the drafters of Bill C-3 seem content to allow the regulations to stipulate that the fee assessment will be the same. This means that even if Bill C-3 is passed-Mr. Speaker, I would like direction from the Chair. I
Radio Act
have some very important information and observations to bring to the House with respect to this Bill. As it is almost one o'clock, I ask your guidance. Shall I continue my remarks at two o'clock?


The Acting Speaker (Mr. Paproski):: Yes, the Hon. Member will have the floor at two o'clock. It being one o'clock, I do now leave the chair until two o'clock this day.
At 1 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.
The Acting Speaker (Mr. Paproski):: When the House rose at one o'clock the Hon. Member for Mount Royal had the floor.


Sheila Finestone: Mr. Speaker, I was commenting on the rather significant aspects of Bill C-3 now before the House, a measure which does not appear to be overly controversial- all three lines of it-but which will affect all Hertzian wave users in Canada.
Mr. Speaker, Bill C-3, an Act to amend the Radio Act, reads as follows:
Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:
1. Subsection 2(2) of the Radio Act is repealed and the following substituted
therefor:
"(2) Subject to subsection (3), Her Majesty in right of Canada and each province is bound by this Act."


EXPLANATORY NOTE
[Stage Direction]
Clause 1: This amendment sould repeal the exemption from the payment of licence fees granted to Her Majesty in right of Canada or any province.
It has been recommended that the procedure of the Department of Communications be changed so that expenditures incurred by the Department may be recovered.
[Stage Direction]
Although the Government indicates that the fees to be charged government users under the Bill will be calculated on the same basis as the fees already assessed to private users, Bill C-3 does not so provide. Rather, those who drafted Bill C-3 seem content to allow the regulations to stipulate that the fee assessment will be the same. This means that even if Bill C-3 is passed, there is absolutely no assurance, other than the good will and the word of the Minister, that government and private sector users of the spectrum will be assessed licence fees calculated on the same basis. I accept the Minister's good will and her word, but it is not law. The Government could still amend the regulation to require one class of user to pay higher fees, be it the Government or the private sector.
Therefore, I hope the Government will ensure that once Bill C-3 has passed, regulations are consistent to ensure this
[Stage Direction]
December 12, 1986
Radio Act
equality of treatment. I will be recommending an amendment to the effect that the revenues be capped to the cost recovery for the Department of Communications, and that fairness and equality be assured for the public and private sector. In that regard, I want to discuss in the Legislative Committee the most effective procedures as perceived by the Department of Communications, the Minister and her staff to be able to provide the equity she talked about in her presentation.
Let me deal with the revenues to be raised by the Bill. According to the recent briefings and figures that were supplied to me by the Department of Communications, I understand that the current shortfall between the amount of revenue generated by the radio frequency spectrum branch of the Department and the cost of operating that branch is approximately $10.1 million. I am also informed by officials of that Department that the Government projects that Bill C-3 will allow it to generate an additional sum of $10.1 million from federal and provincial government agencies.
I want to make two comments about those figures. First, the Minister said this morning that the calculation was not final. Second, the Department of Communications seems to hold the view that the passage of Bill C-3 will lead some government users to give up their licences, thereby reducing the amount of licence fees collected. One wonders if the Government is aware that its projections of $10.1 million in additional revenues would appear to be based on the assumption that all current government licence holders will continue to retain their licences. One also wonders whether there may be far in excess of the $10 million raised by this procedure when we consider all the new users who are presently using this service.
Second, the prediction of $10.1 million in additional revenue to be generated by Bill C-3 also fails to take into consideration that new regulations announced by the Government in its press release on June 26, 1986 will likely generate a further $2 million in revenue from Canadian municipalities. I will have more to say about municipalities later.
It is also noteworthy that the report of the Nielsen Task Force on management of regulatory programs included a graph on page 186 which showed that the radio frequency branch of the Department cost $45 million, with a revenue of only $600,000. The Department briefing indicated that only $10.1 million was needed to make the whole procedure selfsupporting. Therefore, one can only conclude that there is some confusion in government circles on exactly how much additional revenue will be generated, how much will be needed and how we can assure that this becomes strictly a cost recovery mechanism rather than an additional revenue generator for the federal treasury.
I support the Government's attempt to institute the cost recovery principle and I think it is very important that it be outlined and defined in this Bill. The Bill should include reference to capping the cost recovery that is envisaged.
I am advised by the Department of Communications personnel that they do not expect that new staff will be needed
to assess new licence fees against government agencies and Crown corporations. While I appreciate that much of the additional work can be done by programming computers, I am concerned that the Department may have overlooked one point. The point is that although the names and addresses of the government users are already on the computer file of the Department of Communications, departmental personnel may, after the passage of Bill C-3, have to go out into the field to ascertain the number of base stations and mobile units which are held by each of the government users. Since I understand that the new fee will be computed according to the number of base stations, that is, the number of headquarters, plus the number of mobile units, that is, the units in each individual car or truck, extra personnel may be needed to make these calculations. If this is not the case then it could be cleared up in a legislative committee hearing which could refine and define the procedures which are to be used to evaluate the cost to be recovered from each of the organisms that will be touched by this Bill.
[DOT] (MIO)
I hope that the Government is aware that Bill C-3 could have important budgetary consequences on certain government departments which are heavy users of radio frequency transmissions. For example, I am in receipt of figures from the office of the Minister of Communications which show that the RCMP will be faced with new licensing fees of approximately $1,012,562 as the result of the passage of Bill C-3. The RCMP was previously exempt from paying such fees. I trust that the Government will not push ahead with this Bill without considering this new drain on the resources of that agency and on the costs to the Government itself.
This is where Clause 2(3) of the Bill could be used by Government and were it could exempt this particular department, and others which I will note. It would restore the whole sense of equity and fairness. For example, the federal Department of Fisheries and Oceans will receive a bill for $189,166. I do not know if that is a firm figure or otherwise. I do not know whether the Department knows that it will receive such a bill. The bill for the Department of Communications will be $27,000. As 1 have said, the bill for the Royal Canadian Mounted Police will be $1,012,562. How will that affect the Force and from where will that sum be forthcoming? Will it be a new allocation or a supplementary allocation? For the House of Commons it will cost $10,860.
I would now like to deal with some of the Crown corporations on which this Bill will have an impact. With respect to the Canadian Broadcasting Corporation the impact will be $132,204. With respect to TeleGlobe Canada the bill will be $4,364. The figure for Petro-Canada will be $75,791. With respect to Canada Post, which we hope will break even, the figure will be $26,834. I have outlined the cost of a number of these initiatives in the cost-recovery program. The question is who will be paying for it? In the end it will be the hydro and utility subscribers, as well as telephone subscribers.
December 12, 1986
[Stage Direction]
Although the Government in its findings and in this document indicates that the expense revenue from provincial Government departments will be $4.4 million and $2.7 million from provincial Government agencies, there are over $7 million coming from provincial Governments which have not as yet to my knowledge been calculated into their over-all budgeting procedure. I think the least we could do is allow them to let us know how they are planning to handle this situation. Will it be through an increase in user fees directly to the telephone subscriber, or will it be directly to the user of the electricity and heat that is coming through because they are using this radio frequency to communicate with their fleet of trucks? With respect to the $3 million which will have to come from federal Government departments out of existing budgets there is nothing with respect to municipalities in this legislation.
I am also advised by the office of the Minister of Communications that the passage of Bill C-3 will mean that the CBC, which was previously exempt, will have to pay more. It is a well known fact that the Government has already cut the budget of the CBC. Perhaps I am being too generous when I use the phrase "cut the budget" since it might be more accurate to say that it was savaged. Will the federal Government increase the CBC's budget to cover the cost of this new licensing fee? I will be seeking an answer to that question and others when the Bill is referred to a legislative committee.
I wonder whether provincial Crown corporations such as Hydro-Quebec have been made aware that it will face new radio licence fees to the tune of $437,000. I know that there was a short, sharp line in the Budget of the Minister of Finance (Mr. Wilson) back in February that was supposed to have advised all these organizations that they would be receiving bills with respect to radio licence fees. I do not know if they were aware of the extent of the bill. I do not know if they have made provisions for it and what is their point of view. The telephone companies in the prairie provinces which will be required to pay substantial new fees as a result of this Bill may have something important to say about it.
Thus my question is, who will pay in the end? The Minister of Finance will recover these funds into his General Revenue Fund but the provincial Governments and Hydro-Quebec will have to go to the users, that is, the taxpayers, with respect to something which is a hidden tax to the homeowner, the businessman and the private telephone subscriber. I hope the Government is aware that this housekeeping cost-recovery measure will cost, and cost us all. It will shift the tax burden once again to the provinces and to the utility companies with no cap on it in its present form.
I referred earlier to the effect this Bill will have on municipalities. I have received correspondence from the head of the municipalities of Canada and from many of the mayors to find out just what was meant in the communique which reads:
Communications Minister Marcel Masse, in a measure supportive of the Government's deficit-reduction plans, today tabled legislation that would require federal and provincial government departments and agencies, along with
Radio Act
municipalities, to pay radio licence fees on the same basis as private users, beginning April 1, 1987.
Under the Radio Act as it now stands departments and agencies of the Crown are exempt from paying licence fees. The communique goes on to explain why the Minister feels that all users of this spectrum, both public and private, should be put on an equal footing for the first time, which will equitably apportion the costs of the spectrum management among all licence users. We have little indication that there will be any change to that. The Bill is identical, all but in number, to a previous Bill.
The Ministers have changed but the present Minister answered a question in the House which leaves cause for concern and consideration again. In response to a question asked by the Hon. Member for South West Nova (Mr. Comeau), who asked the Minister if she has been able to resolve the matter with respect to volunteer fire departments which would be required to pay individual licensing fees for their two-way radios which might have an added substantial cost to the operation of such fire departments, the Minister said:
Mr. Speaker, I thank the Hon. Member for South West Nova for his representations on this issue. Indeed, I have received representations on the issue from a number of other Members. I should like to advise him and the House that I have decided to defer for the time being any changes to the regulations as they apply to radio licence fees for municipalities and volunteer fire departments.
These changes are quite separate and distinct from those included in Bill C-3 which applied to federal and provincial agencies and Crown corporations. They will be proceeded with. However, the changes as they affect municipalities and volunteer fire departments will not be proceeded with.
The question remains, does that mean at all or for the time being? The Minister can giggle and be as nasty as she wishes, but her answer is unclear. If she were the mayor of a municipality she would have certain concerns. If she were the head of a volunteer fire department she would have the right to a clear and unequivocal answer from the Minister and not just a snicker. That is not an answer, and I would suggest that she take her responsibilities concerning these people a little more seriously.
When the Government first introduced the Bill to amend the Radio Act, it issued the press release to which I have just referred. Was the news release misleading? Was the Minister's answer ambiguous? It does give the impression that either now or some time in the future, at the whim of the Minister, the Bill could certainly have an impact which would require municipalities to pay radio licence fees. In fact, municipalities are already paying radio licence fees pursuant to regulations issued under the Radio Act.
Bill C-3 itself does not target municipalities. Rather, it would appear that the Government intends to amend the regulations with respect to municipalities in order to require municipalities to pay fees on the same basis as private users. Municipalities are presently paying fees on a reduced basis so
[Stage Direction]
December 12, 1986
Radio Act
there had better be some clarification of the equity and fairness to which the Minister referred.
There is no control over fees in this Bill. It is through regulations that municipalities have been charged fees. The intention of the Government is clearer than it would have wished it to be. Did the prior Minister of Communications indicate that municipalities should pay? Is the Government hiding this and will it spring it on municipalities later? I think the Government must come clean on this and I would like it clarified.
Some municipalities may not fully appreciate the additional costs which would be incurred. Those municipalities that use radio frequencies to communicate with garbage collectors, snow removers and street maintenance workers may receive unexpected bills from the federal Department of Communications. Furthermore, municipalities which operate their own police departments, fire departments or ambulance services may also pay more for radio licences. Based on the discussions I have had with a number of prominent mayors of Canadian municipalities, it is not at all clear to them or to me whether or not municipalities have been consulted by the Government about the proposed legislation, or that they have had their fears allayed. I would suggest that in committee, it would be much appreciated if the Minister would table any correspondence in that regard and assure the municipalities of their situation.
In order to clear up the confusion on this issue, the Hon. Member for South West Nova pointed certain things out and received an answer for the time being. I suggest that we should find out the answer once and for all as there remains some confusion about the Minister's comment that she will not proceed with the regulations for the time being. How can municipalities plan budgets?
As I said, I do wish to have this clarified but I do not wish to be obstructionist. I do not wish to cause unnecessary delay, but many people who will be touched by this Bill have concerns. I would suggest that we hear from those people as quickly as possible, as we would when dealing with any Bill that would impose unanticipated taxes or have a large impact. These people have a right to be heard.
I would also suggest that the Bill proceed to a Legislative Committee or the Standing Committee so that various provincial Government agencies or agencies such as the CBC, the RCMP and Alberta Government Telephones will have an opportunity to make representations. I do not expect that the committee's deliberations should have to be lengthy, but I do not wish to deprive interested parties of the right to appear and state their views. I would urge that this Bill be moved to committee and that deliberations take place so we may arrive at the proper decision.
Leslie Gordon Benjamin: Mr. Speaker, I listened with interest to the Minister and to the spokesperson for the Official Opposition. I think I understand the objectives of the Government. I am a little bit at a loss, though, as to which side
the Official Opposition is on. Perhaps it is on all sides. I heard the Hon. Member for Mount Royal (Mrs. Finestone) compliment the Minister in the early part of her speech and then complain about a few things in the latter part of her speech. This causes me to hope that she will have many amendments to move when we get into committee and report stage.
The Minister said that this Bill will help our enterprises, enterprises meaning those that use the public airwaves, to become more competitive and that the general taxpayer will not have to pay for this. I take it from that that she meant that the general taxpayer would not have to pay for the provision of infrastructure and other services provided by the federal Government. She said that the Bill would provide more confidence in safety in the air, at sea and on the land. This causes me to raise the point about the Department of National Defence cancelling all radar, direction, air-speed and ground-speed services to commercial aircraft flying in northern Canada and the high Arctic without the knowledge of the Minister of Transport (Mr. Crosbie). So much for safety in the air.
When I raised this matter with him earlier in the week, the Minister of Transport was good enough to send me a letter the next morning saying that he was looking into the matter. I suspect that he was slightly annoyed about it. I suspect that the Minister of Communications (Miss MacDonald) did not know about it either. The Department of National Defence probably did not tell her either that these services for commercial aircraft that had been provided for several decades by the Department of National Defence would no longer be provided as of October 1 of next year.
The Minister said that in terms of domestic services, this Bill would provide for all Canadians to share equally and that it was a part of regulatory reform. I would like to raise a question about this equal sharing on the part of all Canadians. Here we have a situation of the Crown taxing the Crown. Taxpayers' money will be shifted from one pocket to the other or, more accurately, taxpayers' money will be taken out of a different pocket, in this case the municipalities pocket.
Taxpayers have at least four pockets. They have one for the federal Government, one for the provincial Government, one for the municipal Government and another for the educational system. This Bill provides that the federal Government will tell the taxpayers to take this money out of their municipal Government tax pocket rather than their federal Government tax pocket.
In response to a question put in the House by the Hon. Member for South West Nova (Mr. Comeau) about fees to be paid by police departments, fire departments and volunteer fire departments, the Minister said that she would like to advise the Hon. Member and the House that she had decided to defer for the time being any changes to the regulations as they apply to radio licences for municipalities and volunteer fire departments. We, in our caucus, do not think that is good enough. A year from now the Minister may be promoted to a higher level, and a subsequent Minister may decide "for the time being"
December 12, 1986

has expired. Pressure on this Minister by the President of the Treasury Board (Mr. de Cotret) and the Minister of Finance (Mr. Wilson) may require her to decide "for the time being" has expired.
I think the Minister in her heart of hearts has no objection to building an exemption into the Bill for organizations such as police departments, municipal fire departments, volunteer fire departments, ambulances, municipal or volunteer emergency measures organizations, forest fire-fighting operations, and search and rescue operations. Why should non-profit public bodies that are set up by the taxpayers either through a municipal or a voluntary organization, for example, police departments, fire departments, volunteer fire departments, ambulance services, search and rescue operations, forest firefighting operations, have to pay for using something that already belongs to them, that is, the air waves in Canada? There should be a fee charged for the use of public air waves for private profit. I agree with that, and I think that my colleagues agree. But surely any public utility or service that does not make a profit should not have to pay, through taxes, for the air waves that they already own.
The federal authority in its provision of the infrastructure for these public utilities and volunteer organizations which operate for the public's well-being and safety has a duty to accept this as part of the service. They pay their federal taxes to provide those services. Why should it be necessary to transfer taxpayers' contributions from the federal taxpayer's pocket to a municipal taxpayer's pocket? Why should they have to pay for something they already own?
In the past few years since 1976 the same thing has been going on in transportation, and it is being repeated in this Bill. When the Government of the day established VIA Rail with a $1 item under the Estimates, VIA Rail got stuck for something like $75 million to $80 million worth of old railway passenger cars and locomotives, most of which belonged to Canadian National. About three-quarters of that money was for Canadian National cars. So here we had the spectacle of the Canadian taxpayers paying for all these railway cars and locomotives that they already owned. They paid for them a second time. That is a Conservative and Liberal version of sound business practice. I call it ripping off the taxpayers, not sound business practice.
The rail passenger action force set up by the then Minister of Transport who is now the Government House Leader (Mr. Mazankowski) not only asked the question, but strongly objected to the taxpayers paying through VIA Rail to Canadian National for property, that is, stations, trackage, that the taxpayers already owned. That was a spectacle of the taxpayers paying a second time. This started VIA Rail off with the deck stacked against it.
Again I have to say if that is the Conservative-Liberal version of sound business practice, then us socialists will have to teach them some lessons about sound, fair, business
Radio Act
practice. I find that incredible. If that was tried in the private sector, it would laugh you out of town or lock you up. But the taxpayer can be victimized a second time, and annually thereafter.
The City of Regina is taking a hard look at what will have to be done with a deficit budget, and what will have to be picked up in extra fees for the police and fire departments. No chances can be taken on the Minister's assertion in Hansard that at some future date it will not be faced with having to pay fees for the radios in their police cars, fire trucks, and ambulances. Therefore, it is taking a hard look at its budget and does not know what to budget. I heard the figures that the City of Regina would be stuck with fees of $50,000 to $100,000 for all these fees to the federal Government. Regina is part of the whole general Canadian population that owns the air waves. No profits are being made; in fact money is lost on police services, fire departments, ambulance services, search and rescue, and other types of emergency operations. The taxpayer should not be required to pay any fees for radio services using air waves that belong to all Canadians.
There is no justification for any public service that is not operating for a profit to pay for the use of the air waves. There is no justification for transferring the taxation required at the federal level for this infrastructure. The Minister mentioned the facilities that the federal Government provides, as well it should. But why transfer the taxpayers' costs of those services from the federal Government to the provincial or municipal level? Is the objective to make the federal Government and its deficit look better, and the provincial or municipal deficit look worse? It does not speak well for a Government of any political stripe to be that mean-and I hate to use the word small-for an amount of $10 million in additional revenues for the federal Government, which does not amount to very much in the total scheme of things around here.
A public utility, whether it be a telephone company or a power corporation, established for the purpose of providing a public service and meeting a public need, not for the purpose of making a profit, should also be exempt. There is a difference between Bell Canada and Alberta Tel, Saskatchewan Tel and Manitoba Tel. The publicly owned and operated telephone companies in the three prairie provinces provide a service. Any profits they make are put back into the utilities. The shareholders, namely, the people of the three provinces, are not eligible for and do not expect dividends or a return on the investment they make, through their taxes, in the telephone companies. They do not expect, ask for, or get dividends. However, in the case of Ma Bell, there are many shareholders looking for dividends or for a cut of the profits. This is why telephone services in Ontario, the Territories, and parts of Quebec cost more than they do in the three prairie provinces. They cost more because the prime imperative of Bell Canada is to make a profit. If we told Bell Canada tomorrow that it could only operate on a break even level, it would say to the

December 12, 1986
Radio Act
Governments of Ontario, Quebec and the Territories, we quit; you take it over.
This is not the case with the telephone companies in the three prairie provinces. They are not there to make a profit. They are there to provide the most economical service possible to the people of the three provinces. For the years in which they make profits, the profits go back into capital investment or, if any part thereof goes into the provincial treasuries, in turn the provincial treasuries guarantee loans when they have to go out on the capital market to borrow.
There is no comparison between Bell Canada and the telephone companies of the three prairie provinces having to pay radio fees. The Minister should agree to including in the Bill that those kinds of public utilities, as well as the ones involved in emergencies concerning the health, safety, and security of the citizenry, be exempted from fees.
The people who are shareholders in the ownership of our air waves are being asked to pay again for something they already own. Through their federal income taxes they have already paid for the various facilities of the Department of Communications. They have paid for them once. Now the Minister wants them to pay again for something for which they have already paid when it comes to infrastructure and facilities in the Department of Communications. Surely that does not make good business, economic or social sense.
When the matter is before the committee, I hope the Minister will present an amendment to exempt those functions in society. There is no plausible reason for going to those lengths.
I must confess that I do not understand why Ontario Hydro pays the fees and Quebec Hydro does not. They are both public companies with shares all over the place. I understand that Quebec Hydro may not be a Crown corporation-


Don Boudria: It is. They both are Crown corporations.


Leslie Gordon Benjamin: In that case, Quebec Hydro, Ontario Hydro, Saskatchewan Hydro, and Manitoba Hydro are equal in that respect. They are public utilities. The prime principle for their existence is to provide electrical power at cost. They are not in existence to make a profit first and to provide service second. They are in existence to provide an essential public service.
It would be great if the Minister included a regulation that any power corporation, be it publicly or privately owned, which does not put its profit back into the enhancement of service, infrastructure, or capital requirements, should pay a fee. There is a fundamental conflict in the legislation.
The Minister agreed that she would defer, for the time being, any fees which apply to radio licences for municipalities and volunteer fire departments. I accept her word and believe her. She does not want to charge them a fee. Why not have it included in the Bill? I am sure the Minister has received representations from the urban and municipal associations, fire departments, and police departments across the country. It is
nothing more than financial nit-picking. The Government may feel that it is at the bottom of the revenue barrel. However, it is boring a hole through the bottom of the barrel trying to get below the bottom of the bottom, to get a few million dollars in revenue which will make no difference whatsoever.
If it is the desire of the Minister's officials to show that the Department is breaking even, tough cookie. If their objective is to indicate that the Department is paying its own way, at the expense of municipalities, volunteer fire departments, search and rescue operations, and forest fire-fighters, their objective is badly skewed and their priorities are misplaced. They cannot have it both ways. They cannot make taxpayers pay more than once for the services they receive.
It is futile and improper to transfer a tax burden from the federal authority to a municipality. It would be bad enough to do that to a province. However, to transfer those costs from the federal authority to the provincial or municipal authorities surely is not only improper but an evasion of federal responsibility. The federal Government is in charge of Canadian public air waves. Therefore I agree with the Minister that it is its responsibility to administer efficiently and fairly those air waves. There is no argument about that. Surely it is not fair to transfer the cost of a proper and constitutionally based responsibility from the federal Government to a provincial Government, a municipal Government, or a non-profit organization. It does not stand up to examination. It is patently wrong and totally unnecessary.
If we were talking about hundreds of millions of dollars or billions of dollars, I suppose one would be hard put to object in light of the government deficit, that is, if one lost a lot of sleep about the deficit. I do not lose a lot of sleep about it. About 80 per cent of that deficit we owe ourselves. The Government borrows money from us and pays it back through our Canada Savings Bonds, guaranteed investment certificates, treasury bills, bonds or whatever.
There is no fiscal or financial imperative here for the Department of Communications to be trying to make taxpayers pay again for something they already own, and I mentioned the situation of VIA Rail and the CNR. Asking the taxpayers to pay a second time for something they already own is not even funny, but it is sort of endemic in every department. Public domain is the property of the public.
When you apply the principle of user pay across the board, started by the late unlamented Otto Lang, which the Conservatives decried as vociferously as we did-probably even more so because there were more of them-to something that already belongs in the public domain it is self-defeating. It is self-defeating in the sense that you are saying to the people of Canada that the air waves belong to them. Then you are telling them that, while they have paid federal tax to cover infrasture and the cost of the Department of Communications, they now have to pay again through their municipalities. They will pay fees for their little radios, police cars, fire trucks,
December 12, 1986

volunteer fire departments and search and rescue operations unless those are operated by the federal Government and are exempt.
I think of the hundreds and hundreds of hours put in by volunteer pilots with their aircraft searching for downed aircraft. Why charge them a fee for their radios?


Don Boudria: Agreed.


Leslie Gordon Benjamin: Are we that desperate that we have to nitpick and pick up every spare copper that the federal Treasury can get? That does not say much for the greatness of the minds of those in the Government, and it does not speak well for the officials in the Minister's Department.
I hope the Minister of Communications will rise in her place and tell us that she does have at least one, preferably two or three amendments, that would put in practice her own view. I believe her and I accept her word that she has considered the representations made by the urban municipal associations, police and fire departments. I hope she defers this Bill for the time being. I want to say to the Minister though, as sincerely as I can, that her statement really is not good enough. To make sure that nobody will charge fees on these kinds of public services, public utility operations, one must put it into the legislation. I, and I believe my colleagues and my caucus, have no objections to those paying a fee who use the public airwaves to make a private profit. They should pay a fee because they are renting part of the airwaves. We have no objection to that. But you do not pick on ambulances, fire trucks and police cars. For God's sake use your heads over there if you are capable. This is so crazy that it would be laughable, except that it is so bad in principle.
Surely the Government has no other alternative but to extend the legislation in a small way, and that will not in any way affect the Government's ability to collect revenues from radio and television stations. The Minister wept tears over Cancom, a private telecommunications company in Alberta having to pay this fee while the Alberta Government Telephones did not. My hon. friend, the Hon. Member for Mount Royal, did not think that was very nice. I am subject to correction on this, but I think Cancom is part of the CNCP operation and a few other fast buck operators. If they want to use the public airwaves for private profit, then they should damn well pay a fee. Why should Alberta Government Telephones, which the taxpayers bought and paid for, have to pay a fee-


Sheila Finestone: One million dollars worth.


Leslie Gordon Benjamin: -just because Cancom does? The Government telephone systems in Alberta, Saskatchewan and Manitoba are not there to make a profit, they are there to provide a service. That is why they are publicly owned and that is why our telephone rates are lower than in the rest of Canada. That is a return on the taxpayers investment in those three provinces.
Radio Act
This Bill flies in the face of good fundamental principle. The federal authorities are responsible for what comes under federal jurisdiction, and through the general tax system collect moneys to cover the costs of the Minister's Department and all other Departments. The taxpayers pay for that. Why then turn around and ask taxpayers, through their police departments or city councils or whatever, to pay a second time? I wish I had a spare million dollars because I would take the Minister to Federal Court about double taxation. We could have a lot of fun with that. It is just so bad in principle that I hope the Minister will agree that there needs to be an exemption built into the Bill for municipalities, police departments, fire departments, volunteer fire departments and search and rescue operations that are not federally operated. The Department of National Defence is already exempt, as it should be when it comes to search and rescue. I suggest to the Minister that she charge a fee for the use of radios by the Department of National Defence when it is flying Cabinet Ministers or Members of Parliament around the country, since all aircraft are now under the Department of National Defence. In those instances they should pay a fee. Charge them $5 or $10 for each flight for the use of radios when flying Ministers, or even me, somewhere.
Mind you, Mr. Speaker, all you are doing is taking money from one department to another. I started out by saying that when you charge municipalities radio fees, the four pockets that taxpayers have, one for the federal Government, one for the provincial Government, one for the municipal Government and one for education-


Mr. Daubney:: Mr. Speaker, I rise on a question of privilege. I feel my rights, not just as a Member but as a citizen of Canada are being infringed upon. I have been subjected throughout this session, on my duty day, to having to listen to a speech by the Hon. Member for Regina West (Mr. Benjamin). I feel under the Charter of Rights that that is cruel and unusual punishment, Mr. Speaker.


Some Hon. Members:: Oh, oh!


The Acting Speaker (Mr. Paproski):: The Hon. Member for Regina West (Mr. Benjamin) has three minutes left in his speech.


Leslie Gordon Benjamin: Mr. Speaker, I understand and appreciate the Hon. Member's remarks. One reason I pick Friday as a duty day is because that is the day you can get on in Question Period and make a speech more than once.


Flora Isabel MacDonald: Whether or not it means anything.


Leslie Gordon Benjamin: There are hardly any other Members around. The Members sitting here on a Friday are the most dutiful Members of the House of Commons.


Mr. McDermid:: Beautiful?

December 12, 1986
Business of the House


Leslie Gordon Benjamin: Dutiful.


John Horton McDermid: Oh, sorry.


Leslie Gordon Benjamin: Dutiful. They deserve full credit for it. I do not take umbrage at the Hon. Member's remarks. All I can say is that I wish in his case I had a better, more understanding and thoughtful audience.


Some Hon. Members:: Oh, oh!


Flora Isabel MacDonald: But he is dutiful.


Leslie Gordon Benjamin: I am anxiously awaiting, as are my colleagues, for the Minister to accept an amendment or move one herself which will provide the exemptions in the instances I have mentioned. That would include provincial government telephone systems whose profit goes back into the system and no individual shareholder or taxpayer makes a buck out of it. If she will do that she will still be able to charge equitable fees to those who use the public air waves for private profit.


BUSINESS OF THE HOUSE
The Acting Speaker (Mr. Paproski):: I have received written notice from the Hon. Member for Etobicoke-Lakeshore (Mr. Boyer) that he is unable to be present in the House on Monday, December 15, 1986 to move his motion for second reading of Bill C-209 during the hour for Private Members' Business. Accordingly, I am directing the table to drop that item of business to the bottom of the order of precedence. Since notice will thereby be removed, the hour for Private Members' Business will be suspended and, pursuant to Standing Order 39(2), the House will continue with the business before it prior to that hour until the ordinary hour of daily adjournment.




[Stage Direction]
The House resumed consideration of the motion of Miss MacDonald that Bill C-3, an Act to amend the Radio Act, be now read a second time and referred to a legislative committee.
Nelson Andrew Riis: Mr. Speaker, it is a pleasure to have an opportunity to comment on Bill C-3, a very thin Bill in content and principle. It looks so innocuous yet it has incredible implications for the taxpayers of Canada. It is the intention of the NDP to move with some haste to
complete second reading of this Bill and get the Bill into committee. As so many people have indicated, it is important that amendments be made and that the Government be straightened out on this issue.
By and large Bill C-3 will remove the exemption from payment of radio licence fees now enjoyed by federal and provincial governments and their agencies. The Government expects to raise in the order of $10 million a year through this Bill. That money will come from public bodies such as Alberta Government Telephones, Quebec Hydro, Telesat, Petro-Canada, SaskTel and Manitoba Tel. The Department of Communications tells us that licence fees will now range from $5,000 a year to as high as $1 million from agencies such as Alberta Government Telephones. Of course, that cost will be passed on to the various ratepayers, which means the cost of telephone service in Alberta and other western provinces will increase.
In fact, while no one has made the point, this Bill discriminates against western Canada. The Bill identifies western Canadian Crown corporations and government telephone systems and adds to their costs. The lion's share, as is often the case, of this $10 million in additional revenue will come from hard pressed western provinces. This is one more example on a growing list of federal government initiatives which discriminate against western Canadians.
As my colleague, the Hon. Member for Regina West (Mr. Benjamin), indicated, additional fees will be levied on a number of organizations. What we should be doing is considering why the Radio Act originally exempted public broadcasters. There were and still are very strong arguments against the Crown taxing the Crown. The public owns the air waves already. Is it appropriate to expect public agencies and organizations oriented toward public service to now pay to use the air waves they already own? We say this is an inappropriate form of taxation. Radio licence fees are paid so that public property, the air waves, can be soundly managed in the public interest. Certainly the use of air waves should be regulated, but should taxpayers be required to pay for the use of their own property?
The federal Government, of course, is using this mechanism to reduce the deficit. In other words, Canadian taxpayers are going to be asked to pay for the use of something they already own so that the Government can collect millions of dollars in order to reduce the federal deficit. Yet in a sense all the Government is doing is transferring the cost to other jurisdictions. I suspect you are asking why I say that. I want to read from a magazine called Forum, a publication on communications for those involved in municipal Government. In its September-October issue of this year it said that this Bill, and I quote:
-would require municipalities to pay radio licence fees on the same basis as private users beginning April 1, 1987 (for police, fire and emergency services). Former Communications Minister Marcel Masse stated that the proposed amendments to the Radio Act are in keeping with the Government of Canada's deficit-reduction plans as outlined in the Finance Minister's November 1984 Economic Statement and May 1985 Budget.
December 12, 1986

Municipal leaders have commented that the proposed amendments are inappropriate insofar as they are aimed at essential public services.
That is a critical point. They are talking about police protection, fire protection and emergency services. Those organizations will now be taxed by the federal Government to use what they already own. Does that make any sense? Is that logical? No on both counts.
The chairman of the Task Force on Financing Municipal Governments, Mr. Herb Taylor, said Canadian municipalities must do everything they can to encourage the Government to reconsider this very punitive method of deficit reduction on the backs of our policemen, firemen and emergency service workers.
It is reasonable to suggest that if the Government is doing this to raise $10 million a year, surely that is an example of being penny wise and pound foolish. If the Government wants to raise $10 million, may I simply suggest two other areas which would cause an awful lot less pain, be an awful lot more equitable, and would be considered by all Canadians to be a very prudent move.
One of these would be to reform the tax system so that corporations which, in some years, have profits of hundreds of millions of dollars, pay some tax. Mr. Speaker, I know you would think that surely to goodness corporations in Canada which are profitable do pay tax. In fact, there are nearly 80,000 corporations in Canada which make a considerable profit each year, in some cases hundreds of millions of dollars, that do not pay a single cent in income tax. If these corporations paid their fair share of taxes, not only would we make up the $10 million a year which this Bill is attempting to collect, but we would collect billions more.
I understand that later today we may hear a statement by one of the Ministers on the Port-Cartier prison. This is the prison which the Prime Minister (Mr. Mulroney) wanted to build in his constituency against all the recommendations of every group and individual concerned with the penal system in Canada. Putting it in his constituency will cost Canadian taxpayers in excess of $41 million. In other words, if it was built where it should be built, we would save $41 million. If all this incredible, punitive legislation is designed to do is raise $10 million in an effort to reduce the deficit, surely that is silly and ought to be changed.
I will conclude by reading a question asked by a Conservative Member of Parliament on December 1. He said:
Mr. Speaker, my question is for the Minister of Communications. Some time ago I made representations to the Minister on behalf of the volunteer fire departments of Canada. It has been proposed by her Department that volunteer fire departments be required to pay individual licensing fees for their two-way radios. This would have added substantial costs to the operations of the volunteer fire departments. Has the Minister been able to resolve the matter and continue the previous practice of charging one licensing fee?
Today the Minister of Communications (Miss MacDonald) is bringing in legislation which will levy considerable additional fees on volunteer fire departments, volunteer ambulance
Senate and House of Commons Act
services and various Crown corporations such as the Saskatchewan Telecommunications Network, the Manitoba Telephone System and Hydro-Quebec. We urge the Government to reconsider proceeding with Bill C-3. It makes no sense. If the Government wants to raise funds for deficit reduction, surely there are more appropriate ways which would have the support of the people of Canada, such as corporate tax reform.


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


Some Hon. Members:: Question.


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


Some Hon. Members:: Agreed.


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

[Stage Direction]
The House resumed, from Thursday, November 20, consideration of the motion of Mr. Mazankowski that Bill C-20, an Act to amend the Senate and the House of Commons Act, be read the second time and referred to a legislative committee, and the motion of Mr. Rodriguez (p. 1351).
Philip Derek Lewis: Mr. Speaker, there have been discussions among the Parties. There is unanimous agreement among the House Leaders that this Bill be referred to a Committee of the Whole rather than a legislative committee. While I am on my feet, I have two amendments to move to Bill C-20. These amendments have been agreed to unanimously by the other House Leaders. One of them requires a Royal Recommendation. I would like permission to table the Royal Recommendation now before we proceed to Committee of the Whole.
[Editor's Note: See Today's Votes and Proceedings]
I would like to acknowledge that one of these amendments was made partially due to the advice and urging of the Speaker, which we appreciate.


The Acting Speaker (Mr. Paproski):: Before we go to Committee of the Whole, are we going to withdraw the previous question?


Jean-Robert Gauthier: Mr. Speaker, I recommend that we work in an orderly fashion. We are still at second reading, as far as I can see. We can hardly go to Committee of the Whole before we give the Bill second reading. I ask for guidance.

December 12, 1986
Senate and House of Commons Act


The Acting Speaker (Mr. Paproski):: The question is on the motion for the previous question. Is it the pleasure of the House to adopt the motion?


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


The Acting Speaker (Mr. Paproski):: The next question is on the motion of Mr. Mazankowski, that Bill C-20, an Act to amend the Senate and House of Commons Act be read the second time and, by unanimous consent, referred to a Committee of the Whole. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, Bill read the second time and, by unanimous consent, the House went into committee thereon, Mr. Paproski in the Chair.
Steve Eugene Paproski: Order. House in Committee of the Whole on Bill C-20, an Act to amend the Senate and House of Commons Act.
On Clause 1-Override as of January 1, 1986


Philip Derek Lewis: Mr. Chairman, we filed an amendment to Clause 1. We may have been a bit premature in suggesting that we should be dealing with the amendment now. It probably would be better dealt with at report stage. It has been distributed to all parties. Perhaps we could in fact carry on, having passed Clause 1, moving to Clause 2, and then dealing with that particular amendment at report stage.


Steve Eugene Paproski: There is no debate at the report stage, so we will have to deal with it now in Committee of the Whole. Is the Parliamentary Secretary moving the motion?


Philip Derek Lewis: I so move.


Steve Eugene Paproski: These changes go beyond the scope of the Bill and require the unanimous consent of the House. Is there unanimous consent?


Some Hon. Members:: Agreed.


Philip Derek Lewis: I move:
That Clause 1 of Bill C-20 be amended by (a) striking out lines 4 and 5 on page 1 and substituting the following:
1.(1) Subparagraph 34(3)(b)(i) of the Senate and House of Commons Act
is repealed and the following substituted therefor:
"(i) the percentage that the Industrial Aggregate for the first adjustment year is of the Industrial Aggregate for the second adjustment year, and"
(2)	Subparagraph 34(4)(a)(i) of the said Act is repealed and the following
substituted therefor:
"(i) the ''first adjustment year" is the last twelve month period preceding the commencement of the period in respect of which the sessional allowance is to be determined for which the Industrial Aggregate or the Consumer Price Index, as the case may be, is available on the first day of the period in respect of which the sessional allowance is to be determined, and"
(3)	Paragraph 34(4)(b) of the said Act is repealed and the following
substituted therefor:
"(b) the "Industrial Aggregate" for an adjustment year is the average
weekly wages and salaries of the Industrial Aggregate in Canada for the year
as published by Statistics Canada under the authority of the Statistics Act."
(4)	Section 34 of the said Act is amended by
(b) striking out line 1 on page 2 and substituting the following:
"(5) Subsection 34(6) of the said Act is"


Steve Eugene Paproski: Shall the amendment carry?


Jean-Robert Gauthier: Mr. Chairman, may I ask the Parliamentary Secretary to give us a short explanation of the amendment? I understand that the previous Act was based on the composite index as put out by Statistics Canada and that we are now proceeding with an amended Industrial Aggregate. Can he tell us if there is anything we should know about this change and whether we should be aware of how the composite index is arrived at or how the aggregate index would be arrived at in the future, so that we understand exactly what is happening?


Philip Derek Lewis: Mr. Chairman, the terminology "Industrial Composite" was terminated with the December, 1985 Estimates. The new terminology and new information kept by Statistics Canada, I am informed, is referred to as the Industrial Aggregate.


Don Boudria: Mr. Chairman, the wording of page 2 of the Bill is a little unclear in relation to the wording of the last sentence of the amendment. It is listed as part (b) of the amendment, but listed in such a way as to make it rather difficult to understand. Could we get some further explanation from the Parliamentary Secretary as to just what it is that Clause (b) of the amendment amends? Does it amend page 2 of the Act and therefore is it completely separated from the previous line which amends the Act? I gather that Subclause (b) amends the Bill itself, is that correct?


Philip Derek Lewis: Mr. Chairman, after consultations I am advised that Subclause (b) as shown in the amendment is simply a substitution for what appears on page 2 by "striking out line 1 page 2 and substituting the following".


Steve Eugene Paproski: Shall the amendment carry?


Some Hon. Members:: Agreed.


[Stage Direction]
Amendment agreed to.
Steve Eugene Paproski: Shall the clause, as amended, carry? The Hon. Member for Glengarry-Prescott-Russell.


Don Boudria: Mr. Chairman, I have discussed this matter privately with the Parliamentary Secretary. I seek his assurance with respect to the texts in French and in English on page 2 from lines 4 to 11. The English does not appear to be the same as the French. I seek the assurance of the Parliamentary Secretary that it is his understanding and the understanding of his official that in fact the two mean the same. I think that I
December 12, 1986

can see a difference between the two, but if I receive such an assurance from the Parliamentary Secretary then that will be sufficient.


Philip Derek Lewis: Mr. Chairman, I wish to thank my colleague for bringing this matter to my attention. We have had discussions in this respect. It is our understanding that the two paragraphs are in agreement as drafted.


Steve Eugene Paproski: Shall Clause 1, as amended, carry?


Some Hon. Members:: Agreed.
Clause 1, as amended, agreed to.


Philip Derek Lewis: I seek some clarification from the Chair, Mr. Chairman. During discussions with respect to this Bill a method of handling as easily as possible the $1,000 reduction in salaries was discussed. There was an agreement to move an amendment which would see deductions come off the next four pay cheques, that is, the pay cheques for December 31, 1986; January 31, 1987; February 28, 1987; and March 31, 1987. It is my understanding that this could be done by adding a new clause to the Bill. This matter has been discussed among the Parties.


Steve Eugene Paproski: I do not have a copy of the amendment.


Philip Derek Lewis: I will read it to Hon. Members. It states:
That Bill C-20 be amended by adding after line 11 on page 2 the following:
2. The amount of one thousand dollars referred to in subsection 34(4.3) of the /Senate and House of Commons Act/, as enacted by subsection 1(1), may be deducted from any amount payable to a member of the Senate or the House of Commons pursuant to that Act during the fiscal year ending on March 31, 1987.
I apologize to the Chair. It was my understanding that copies of this amendment had been distributed to officials of both Parties. I thought it had been done. Obviously it has not been done. On behalf of the Government I apologize for the fact that it was not done.


Steve Eugene Paproski: Is it the pleasure of the House to adopt Clause 2?


Some Hon. Members:: Agreed.
Clause 2 agreed to.


Steve Eugene Paproski: Shall the title carry?


Some Hon. Members:: Agreed.


[Stage Direction]
Title agreed to.
Don Boudria: Mr. Chairman, I just want to be entirely clear here with respect to the procedure. I gather we have agreed to go back to Clause 1 or is this a separate clause numbered 2?


Steve Eugene Paproski: This is a new clause numbered 2.
Bill reported.
Excise Tax Act


The Acting Speaker (Mr. Paproski):: When shall the Bill be read the third time? By leave, now?


Some Hon. Members:: Agreed.


Gérard (Gerry) Weiner: that Bill C-20, an Act to amend the Senate and House of Commons Act, be read the third time and passed.
Motion agreed to and Bill read the third time and passed.


The Acting Speaker (Mr. Paproski):: We need unanimous consent to take up the next order of business. Is there unanimous consent?


Some Hon. Members:: Agreed.


Nelson Andrew Riis: Mr. Speaker, we are certainly prepared to give unanimous consent to expedite the passage of Bill C-14 today with the Understanding, of course, since we are recognizing that report stage and third reading discussions would begin today, that the House would also welcome any amendments that might be put at report stage.


Philip Derek Lewis: Mr. Speaker, that undertaking was given when discussions took place. I think, however, that the word was "accept" rather than "welcome".


EXCISE TAX ACT AND EXCISE ACT
[Stage Direction]
The House proceeded to the consideration of Bill C-14, an Act to amend the Excise Tax Act and the Excise Act, as reported (without amendment) from a legislative committee.
Nelson Andrew Riis: That Clause 5 of Bill C-14 be deleted.


Thomas Hockin: Mr. Speaker, I would like to begin by thanking my colleagues for putting the process in motion so that we may have expeditious passage of this Bill today. I do wish to speak to the amendment which of course would, in effect, remove the very heart of the Bill. It would prevent us from increasing the rate of the federal sales tax in the way Clause 5 outlines. The motion put by the Hon. Member for Kamloops-Shuswap (Mr. Riis), if passed, would cost the Consolidated Revenue Fund $1.1 billion to $1.25 billion according to my calculations.
I know Hon. Members on all sides of the House want to see the Government of Canada give solid leadership in dealing with the deficit. Of course, this package of excise tax increases must be passed in order to come to terms with government expenditures and to continue our resolve to decrease the deficit.

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Excise Tax Act
I know Hon. Members are aware of the considerable success we have had in meeting our target of decreasing expenditures. If it had not been for some unforeseen calamities that have occurred in the economy, we would have been right on target. Because of the calamities, including the agricultural situation and the price of oil and gas, we have had to look to new ways of raising revenue. Of course, that is what Clause 5 of this Bill does.
The federal sales tax increase of 1 per cent contained in this Bill would raise between $1.1 billion and $1.25 billion next year. As well, because of this Bill, we will not be required to increase income taxes any further than we have to date and we will not have to increase corporate taxes or customs charges and duties.
We are going through a process of tax reform. This process will look at the federal sales tax system to which the Hon. Member for Kamloops-Shuswap is speaking. If we can bring in a broader based federal sales tax, we may be able to decrease the level of taxation even further than that of which the Hon. Member is thinking after we have finished with tax reform. Until then, of course, it is imperative that the Bill as written, including Clause 5, be passed.
Federal sales tax reform will do something for which the people of Canada have waited decades. It will put in place a fair system. As we all know, federal sales tax is now applied to commodities and to manufacturing but not to the other two-thirds of the economy, the service sector. We would like to bring down the high rate of federal sales tax and spread it across a wider base. That will be part of tax reform, together with the lowering of marginal rates of personal income tax and corporate tax. It is very important that we do that.
If we did away with the federal sales tax entirely, my calculations indicate that personal income taxes would have to be increased by almost 50 per cent at the lower end. There simply would not be enough income at the top end to make up the difference. The Hon. Member is not suggesting a total removal of the federal sales tax, but theoretically, if there were no federal sales taxes, we would have to load revenue production on to the personal income taxes.
In this particular case, $1.1 billion is about one-twelfth of the problem. If we are to raise the $1.25 billion which could very well be raised through Clause 5 through the personal income tax route instead, we would have to raise taxes not only at the high level but at the middle level and that would be unacceptable given our present tax rate, particularly while the Government is absolutely determined to decrease the levels of personal income tax after tax reform.


Leslie Gordon Benjamin: What about corporation tax? What would you do about that?


Thomas Hockin: Corporate tax as well will be studied. In corporate tax reform, we must look at the tax preferences and deductions that are in place as well as the tax losses and all of the things that make it more difficult for us to receive the
revenues from the corporate sector that we believe we should receive. All of that is being looked at in the context of tax reform.
I welcome the Hon. Member's amendment in the sense that it is forcing us to think about in which direction we should go with the mix in our tax system. I also welcome the fact that all Hon. Members have agreed to give this Bill speedy passage. However, I must say that until the tax system is reformed, it is important that we not break from the direction this Bill is taking us. This Bill will give us the revenue required over the next year or two to put in place a more comprehensive and effective regime.
As you know, Mr. Speaker, this Bill provides for a federal sales tax credit, an innovative and very important reform. It helps to reduce the regressive effect of a sales tax increase on low-income Canadians. As we went through the Bill in committee, there were many good questions put on this matter. We found out that with the average increase of 1 per cent per capita in federal sales tax, a person earning $15,000 or less annually would pay about $25.30 more, but we will give a $50 credit per adult. We are not just making a slight gesture toward people in that income bracket, but more than compensating them for the increased taxes they might have to pay.
Moving further and looking at the $25 per child, for a family including a wife, husband, and four children, there will be a credit of $200. From the calculations that I have, that more than compensates-


Michael Morris Cassidy: It is $150.


Thomas Hockin: It is $25 per child, plus $50 per adult for the example of the prepayment of the child tax credit. The Hon. Member is quite correct that it is $150 for the example that I gave for the federal sales tax credit.
I am grateful that Members on all sides of the House are taking an interest in the question of taxation. We wish to have all the ideas produced in the next six months in a very intensive way so that our tax reform will be effective.
It is my hope, and it is in the spirit of the amendment that over-all federal sales tax levels will be able to be diminished as a result of the BTT or some variant of it that we can bring in through tax reform.
Finally, we must remember that the over-all thrust of this legislation is to help us continue on track with decreasing the deficit. That is what has given Canadian people the confidence to invest in this economy and create the thousands of jobs that have been created. It has also given us confidence in our dollar, and kept our interest rates at a moderate level. If we do not come to terms with the deficit, we will find that our interest rates will be so high that our job creation will start to fall back, and the strength and the great confidence in our economy will dwindle.
December 12, 1986

Over-all this is a measure aimed at controlling the deficit which will do so in a way that is not regressive.


Michael Morris Cassidy: Mr. Speaker, I wish to talk about this particular section and what it means in terms of the over-all changes in the sales and excise taxes which are contained in Bill C-14.
I asked the Hon. Minister of State for Finance (Mr. Hockin) a question in the House today about why the Government was giving yet another gift to the very wealthy Canadians by allowing the lifetime capital gains tax exemption to be partly free of the minimum tax. The Hon. Minister gave many irrelevant answers. He did refer to the sales tax credit. But what he did not say was that on the one hand we give a very small credit to families under very limited circumstances at the same time that we are increasing their cost of living by the increase in the sales tax which came into force on April 1, 1986. On the other hand we are giving very generously, because it turns out that the one income that people can have which will be partially exempted from the minimum tax, which I think most Canadians feel should be subject to the minimum tax, is going to be capital gains. Most capital gains income is earned or gained in some other way by people who are among the top 5 per cent of income earners in the country. So those people get a gift at Christmas from the Government-and it will be dealt with next week-and at the same time we are putting up the general sales tax from 11 per cent to 12 per cent. What this Bill does is to simply confirm what the Government did effective last April 1.
The motion moved by the Hon. Member for Kamloops- Shuswap (Mr. Riis) is to delete Clause 5 of the Bill. Clause 5 of the Bill has the purpose of increasing the sales tax to 15 per cent on wine and liquor, to 8 per cent on certain other products, and to 12 per cent on the sale price of most goods covered by the manufacturers sales tax.
Our concern is that the Government has chosen for the third time in a row to use a regressive means of taxation for raising revenues in its quest to fight the deficit. A regressive form of taxation is one that bears more heavily on people of modest incomes than it does on people who are wealthy. In other words, we are fighting the deficit on the backs of ordinary Canadians.
The figures are quite convincing, and I wish to read a couple into the record. In the February 26 Budget the sales tax increase for an average family will add about $150 to their cost of living. On top of that there is a cigarette and alcohol increase which will add about $20. The 3 per cent surtax which will be borne for the first time by average Canadians will add $170. The total is $340. In the Budget of May, 1985, there was $ 150 added by the broadening of the sales tax base. There was $75 added by the increase in the cigarette and alcohol tax.
There was $50 added by the increase in the gasoline tax. There were other increases which have been read into the record on a number of occasions in this House which bring the total increase for the average family to $512.50. I believe that
Excise Tax Act
we were estimating for a family in the $30,000 to $35,000 income range. In the November, 1985 Economic Statement there was a sales tax increase which at that time added $150 to the tax burden of the average family. In addition, it raised oil and gas prices by $200. It raised unemployment insurance premiums by $102. The total over the three Budgets plus the Economic Statement was $1,304.50.
The New Democrats have put those figures on the record, they have been communicated to the ministry, they have been put out through the press, and not once have those figures been challenged. I believe that is because the ministry accepts that our calculations are accurate for an average family with an income of $30,000 or $35,000 a year.
How much does that family benefit, if at all, from the sales tax credit which is being proposed? Well, none at all, because the sales tax credit will come into force for families with up to $15,000 a year of gross income. By the time it reaches a family of four, their eligibility for any sales tax credit will be extinguished when they hit an income of $18,000. In addition, the amount of the sales tax credit is all of $150 for a family of four with an income of $15,000 a year, which is 1 per cent of their income, not a heck of a lot. It disappears very quickly. For example, people in my constituency who are living at the poverty line for a major urban community like Ottawa, which is in the order of $20,000, will pay extra sales tax and will not receive a nickel's worth of benefit from the sales tax credit, which has been introduced in complementary legislation by the Government, and which we will be looking at next week.
I am particularly concerned by the fact that the Government in the Budget statement last February stated that it recognized that sales tax is a regressive tax unless something is done to soften the blow. In principle, it said what we have been saying, which is that sales tax cannot be increased unless measures are brought in to ensure that it does not bear as harshly on poor people and people with modest incomes as it does on people who are very wealthy. In principle, we are saying the same thing.
We are moving to delete this particular increase in sales tax precisely because the Government failed to follow up its principle with something practical to recognize what we mean. Since November of 1985, in the last 25 months, we have had one increase in the sales tax of $ 150 for the average family, a second increase in sales tax of $150 and now a third increase in sales tax of $150. There have been increases on cigarettes and alcohol which amounts to close to $100. There have been gas tax increases of $50. These are all taxes that tend to be regressive. The total of these various taxes would be in the order of $700.
What have we had to counter that? We have had one sales tax credit. Did the Government do anything to protect ordinary low-income families from the sales tax increase in November, 1984? Not at all. Did it do anything to protect those families from the sales tax increase and the gas tax

December 12, 1986
Excise Tax Act
increase in the 1985 Budget? Not at all. All it did was bring in something which in a modest way will reach a very limited group of families who are really very poor. They need far more to make ends meet than the sales tax credit which accompanies the sales tax increase.
When we debated the issue the other day in the Standing Committee on Finance and Economic Affairs, I made constructive suggestions. I had heard what was suggested by the National Council of Welfare, that the sales tax credit should be in the order of several hundred dollars for a family of four rather than $150. In fact I moved that the sales tax credit should be $200 per adult, that is, $400 for a couple or a single parent with a child, and $100 per child beyond that. It could be phased out between $15,000 and $28,000 per year for a family of four. If implemented, it would ensure a substantial measure of progressivity in terms of the application of sales tax.
I see that my time is about up. The Government is talking about bringing in a business transfer tax. It will be a hidden form of federal sales tax reaching many areas which are not taxed right now. It is saying that we should not worry about the regressivity factor because even though it is taxing almost everything one can look at, buy, consume, or get service from, it will have some kind of tax credit to offset the effect on people with modest incomes.
I do not think the Conservatives have awakened to the fact that $20,000 these days is not a heck of a lot of money on which to raise a family. The Government is giving its blueprint for the future sales tax credit with the BTT. If this is the model it chooses, it will be inadequate. This is why we are saying the particular clause should be deleted. The Government is wrong to be increasing sales tax year after year without taking adequate provision to ensure that people with low and modest incomes, working Canadian families, are in fact protected and not hit by a regressive tax levy that they can ill afford to pay.
As I said at the beginning of my remarks, if the Government can give a gift to wealthy people by exempting them, at least partially, from a minimum tax on their capital gains, it should be able to do it progressively and equitably for ordinary Canadians.


Alfonso Gagliano: Mr. Speaker, I also have some comments to make on this amendment. First of all, we have here a political party that promised, during the last election campaign, that it would not raise taxes but reduce them, and today, if we look at sales tax alone, we have already had three increases: 1 per cent in November 1984, 1 per cent in May 1985 and 1 per cent in 1986.
Mr. Speaker, when the Minister appeared before the Committee and when he spoke this afternoon in the House, he was constantly referring to the sales tax credit for families with annual incomes of $15,000 or less. First of all, these incomes are below the poverty level, so the tax credit is not
really adequate. I think that these people, with the meager $50 they will be getting ... It is regrettable that the Government should burden people in this way by increasing taxes. Although it says it is refunding money to poor families, Mr. Speaker, with some simple arithmetic it is easy to figure out that for every 1 per cent increase in sales tax, this means an increase of $175 for a family with two children. So if we take the last three sales tax increases, we get a total of $525, and the tax credit referred to by the Minister would then add up to $150. So a family, a couple with two children and an annual income of $15,000 has had to pay $375 more in federal sales tax since September 1984.
Mr. Speaker, this is a situation we cannot accept, and maintaining the position we took on second reading, before the Committee and this afternoon as well, we intend to vote against the Bill. The Minister also referred to tax reform. We have been waiting for his proposals for some time, because we are anxious to know what they contain, what exactly the Government is going to propose. Up to now, we have not had much more than grand statements and window dressing. Everyone wants tax reform, but it all depends what kind.
Will it mean that, for instance, the Income Tax Act will be simplified or will the reform apply to all tax legislation? Will Canadians be able to make some sense of all this and realize what it is going to cost them, what a tax is, because today, there is no way we can make any sense of all this. For instance, not long ago, in fact last Saturday, we read in the Montreal Gazette about a small business, Alexander Ceramic Studio, which, because it had exceeded the $50,000 limit for business turnover, automatically became subject to federal sales tax. The owner of the business could no longer keep up with his competitors, and he actually lost money, first because of the additional financial outlay because he had to pay the tax retroactively, and second, he lost customers because he had to charge federal sales tax, while his competitors next door did not because they had not yet reached the $50,000 ceiling, and so, to get out of this mess, he had to reduce sales so that he would stay under the $50,000 limit.
Mr. Speaker, I hope that in the tax reform process all these things will be taken into account and in connection with the famous business tax which the Conservative Government is getting ready to introduce, I hope it will keep in mind all those small businesses which, once that tax has come into effect, will need to have a license, to report and to be subjected to all the redtape and accounting that such a tax will entail.
A tax reform should lead to a reduction in paperwork, but we have a tax here which will increase the paperwork since at least 500,000 small businesses will probably have to comply.
I therefore urge this Government to recognize that very special situation and take into consideration the last budget.
In committee, Mr. Speaker, we received a brief from the National Anti-poverty Organization. According to the figures published by the National Welfare Council, couples with two children having an income of about $20,000, which is below
December 12, 1986

the poverty line in many Canadian urban centres, will pay 1.3 per cent of their family income to cover the extra cost of the sales tax and excise tax increases provided for in the 1985-86 budget. Because very often in their speeches, Government Members when talking about the sales tax credit refer only to the 1 per cent in the last budget. But with the whole package, the 1985 and 1986 budgets, we will find that this meager $50 is not enough to cover that tax, especially for families with income below $20,000.
What about those with incomes of $22,000, $25,000? That is where the whole question lies, Mr. Speaker. It is my view that the Government was fully aware of that when it decided to grant an income tax credit for families with income below $15,000 it knew very well it wanted to set a limit. That was no doubt a noble gesture to hide the true intention, this Government's real objective with all those tax increases.
Mr. Speaker, I intend to support this amendment, and I would like to add that there is one amendment that deals with the whole issue of the price of wine. We are becoming increasingly aware that we have our own wine industry here in Canada. We are starting to make good Canadian wines. There are Canadian vintners, and I think the Government should realize this and perhaps abolish sales tax altogether on wine produced in Canada.


Nelson Andrew Riis: Mr. Speaker, I want to put a few words on the record at report stage of Bill C-14, an Act to amend the Excise Tax Act and the Excise Act. By and large, Bill C-14 imposes a whole range of new taxes on the people of Canada. The amendment before us was put forward to eliminate the increases in the federal sales tax. I think it is important that Members of Parliament are aware-


The Acting Speaker (Mr. Paproski):: I regret to interrupt the Hon. Member. I thought he was rising on a point of order. This is the Member's motion. Therefore, I must recognize his colleague, the Hon. Member for Spadina (Mr. Heap). I am afraid I cannot allow the Hon. Member for Kamloops- Shuswap (Mr. Riis) to speak again.


Daniel James Macdonnell Heap: Mr. Speaker, I am glad you intervened to secure justice, even within our Party.


Some Hon. Members:: Oh, oh!


Daniel James Macdonnell Heap: I am very happy to second this motion and support the direction which the Hon. Member for Kamloops- Shuswap (Mr. Riis) has taken and will be taking again. I am also pleased to have a chance to say a few words on this Bill before I leave.
What we have here is another sales and excise tax increase. I suppose the Government figures people will not notice because it is only 1 per cent in general, up from 11 per cent to 12 per cent and, along with the excise tax, it will be only $170 for the
Excise Tax Act
average family. The trouble is that it comes on top of $1,300 in sales tax increases since November of two years ago. It is this Government's philosophy to keep reducing the effect of tax on the rich and increasing the effect of tax on low and middle-income people.


John Horton McDermid: What about the sales tax credits?


Daniel James Macdonnell Heap: This philosophy of the Government is different from the philosophy that we heard about some years ago, which was to trickle down. This is a philosophy of trickle up. There will be a little Mickey Mouse sales tax credit to the poor which will not come near matching what has been taken away from them in these regular sales tax increases. For the middle-income people, there will be no tax credit. The ones who have more money than they need to spend, the ones with really high income levels, will not mind paying these sales and excise tax increases. They are gaining on the income tax cuts and the increasing loopholes, such as the loopholes being made for more and more money going to fewer and fewer people through the capital gains tax relief by flipping property and playing real estate games. That sort of tax will be made more free to the really rich, and they will not mind paying 1 per cent extra on the ordinary necessities of life.
The pretended philosophy of the Government is that if we scoop money from the poor and give it to the rich then the rich will create jobs. That philosophy is not working, Mr. Speaker. Notwithstanding the statistics that the Government manipulates regarding jobs, the working people in this country as a whole are growing poorer. The rich do not spend in the same way as the poor. The rich spend a good deal of their money on luxuries, many of them imported. That does not create jobs in Canada. They spend their money travelling abroad. That does not create jobs in Canada. They probably send $10 billion or $20 billion every year out of this country in investments. There is no evidence that those billions of dollars created by the work of Canadians sent abroad by the rich, who have been able to collect them, create jobs in Canada. This philosophy of trickle up is making the country poorer.
What we have is a warning indication from some of the established groups in our country who provide a sort of monitoring, a sort of check on what is going as a result of these regular increases in the sales tax. The quarterly economic review published by the Department of Finance shows that in April and May, 1986 the disposable income of Canadians fell by 2 per cent. The Conference Board of Canada agrees that consumer spending will be slowed by the Conservative tax increases.
The consumers in the great, great majority in Canada are the low and middle-income people. It is those consumers whose failure to keep up the level of spending that our credit economy looks for who are causing a slowdown in the economy. Their disposable income is decreasing, the effect of which is beginning to depress the economy. If people cannot spend, then people cannot work to sell. If no one is buying, the stores do not buy and workers are laid off. This is how sales tax hits

December 12, 1986
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the country as well as hitting the low income and middle income people.
It would be well worth while if the people who rule this country, the people on the other side of the House, would pay attention to the statements put out by the bishops of the Roman Catholic Church three years ago in which they advocated what they called the preferential option for the poor. Their argument has a basic strong logic: A country that looks after the needs of its poorest people will find that the needs of its richest people are also looked after. It does not work the other way around. A country that rigs the tax laws the way this Government is doing, so as to take from the poor and give to the rich with a sort of vague promise that the rich will use that money to create jobs for the poor-a country that scoops from the poor to give to the rich-is ruining its own economy. It has happened many times before in history. We can see it in front of our eyes in Canada under the misguided philosophy of this Government.
That is why I support this motion to delete the 1 per cent sales and excise tax increase from this Bill, because it will not help Canada. It will bring a little more revenue to the Government perhaps at the beginning but by depressing the spending power of the vast majority of Canadians by depressing the market, a dependence on their spending power, it will cause greater troubles for our country. I ask Hon. Members to think about what they are doing this time. Two years ago it could be taken as excusable perhaps because we had a new Government, perhaps it did not know what it was doing, but by now it cannot use this excuse-


Don Boudria: Yes, it can.


Daniel James Macdonnell Heap: It cannot get away with the excuse. The Hon. Member says that perhaps the Government will when it is blamed for what is happening. But the Government has had time in two years to see what is happening. During those two years Conservatives have taken twice as much through sales and excise tax increases as they have through income tax increases; $6.7 billion as opposed to $3.3 billion. Those tax increases were not paid mainly by the rich but rather by middle-income earners. It is the poor and middle-income earners who are being hit by this Government. Not only will they suffer immediately and directly, the country as a whole will suffer unless the Government wakes up to the harm it is doing.


Don Boudria: Mr. Speaker, we just heard an NDP Member say that the Government perhaps did not know what it was doing two years ago but today we can no longer make that accusation; the Government now knows what it is doing. However, I want to go on record as saying I totally disagree with anyone who suggests the Government knows what it is doing. I want everyone to know that before I give the rest of my remarks.
As we discuss this amendment to Bill C-14, it is important to know the commitments that those people across the way, who do not know what they are doing, made to the people of Canada before the last election. They made several promises as you will recall. I have raised those on one or two occasions in the past. They are listed in the book of 338 Tory promises, a copy of which anyone can have if they write to me, no postage stamp necessary, requesting a copy of the book of 338 Tory promises.
As I was saying, on the page dealing with small business it says that the Tories were to reduce the level of taxation facing small business and the complexity of the tax system with which they must cope. I know you want to know if it was the Tories who made that promise. The answer is yes. That is one thing the Conservative Party promised to do. What do we see instead? We see budgetary measures which mean tremendous increases not only for families but for small businesses such as the corner grocery store and small manufacturers. They all have to pay increased taxes as a result of the Government's budgetary measures.
My colleague, the Hon. Member for Ottawa-Vanier (Mr. Gauthier), indicated to me earlier today that since the Government came to office the tax increases amount to something in the order of $3 billion. Not bad considering they were telling small businesses they were not going to face a tax increase.

If we look at the average and especially the cumulative impact of these taxes, we see that there is a broadening of the sales tax base. In other words, it means that the average Canadian, people like you and me, Mr. Speaker, it means that our constituents will now have to pay tax on certain items that were previously exempt.
Obviously, this is going to create problems for a great many people, for small businesses and especially for families on middle and low incomes.

We note as well the increase in alcohol and tobacco excise taxes. The amendment before us would remove that increase. Among other things, the tax on wine was increased from 14 per cent to 15 per cent. That is enough to drive a person to drink.
It is extremely frustrating to look at what the Conservatives are doing to the average Canadian. For example, let me bring to your attention, as I think I may have before, the cost of these new taxes and who is going to pay for them. A couple with two children making $15,000 a year will have to pay an extra $255 in taxes. Do you think that family has an extra $255? If they do, which they likely do not, I am sure they do not want to give it to the Tories, particularly when one considers their record.
You will know, because I brought it to your attention in the House earlier this week, that the Government spent $2.6

December 12, 1986

million for the Shamrock Summit in Quebec City, and the emphasis is on the first syllable. The Shamrock Summit saw five jets flying from Ottawa to Quebec City carrying one Minister each. I know they were Cabinet heavyweights but surely they could have doubled up. I know the Minister of State for Finance (Mr. Hockin), who is in charge of watching the purse-strings, is concerned about that kind of activity by his colleagues. He drives back and forth from London in his car, and he would not want to see others flying in jets all over the place.
Then we hear the Government is going to pay the legal bills of a Member of this House amounting to $350,000. Why? Who knows. I see the junior Minister of National Defence (Mr. Beatty). He should know about wasteful government expenditures. He is well versed on the topic, and a participant, too. The Minister of State for Finance should know that this move to pay a former Minister's legal bills is without precedent.
I have a lot more to say on unnecessary government expenditures, such as the $ 1 million spent on the Far East trip by the Prime Minister (Mr. Mulroney), but given the sense of fair play which the Liberal Party has always had, I do not want to delay the debate unduly. Given the festive season and the co-operation which is developing in this House, I think I will end my remarks and merely ask all Members to vote for the amendment which would stop these tax increases from going ahead.

Mr. Speaker, in concluding, I would urge all Members and of course you yourself to vote in favour of the amendment that would reduce the incredible tax increases that the Conservatives want to impose on the Canadian people.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


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


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


The Acting Speaker (Mr. Paproski):: In my opinion the nays have it.


Some Hon. Members:: On division.


The Acting Speaker (Mr. Paproski):: I declare the motion lost.
Motion (Mr. Riis) negatived.


Thomas Hockin: that the Bill be concurred in.


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


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.
Philip Derek Lewis: Mr. Speaker, there have been discussions among the Parties. In view of the progress made today, that is, completion of the second reading debate on Bill C-3, the completion of Bill C-20 at all stages and the completion of report stage on Bill C-14, we suggest that the Chair now call it five o'clock.


The Acting Speaker (Mr. Paproski):: Is there unanimous consent to call it five o'clock?


Some Hon. Members:: Agreed.


The Acting Speaker (Mr. Paproski):: Order! It being five o'clock, this House stands adjourned until Monday next at 11 a.m., pursuant to Standing Order 3(1).


[Stage Direction]
The House adjourned at 4.31 p.m.
[Stage Direction]

Monday, December 15, 1986