1987-02-18

Mr. Dave Dingwall (Cape Breton-East Richmond):: Mr. Speaker, the Government is attempting to cover up the true facts about Bill C-22 and its impact on the cost of drugs in Canada.
On three separate occasions in the House the Minister of Consumer and Corporate Affairs (Mr. Andre) and the Minister of National Health and Welfare (Mr. Epp) alluded to the fact that they would produce for members of the legislative committee studying Bill C-22 the cost implication studies which were carried out by Consumer and Corporate Affairs.
In a motion recently put before the legislative committee, Conservative Members voted down the request to have the Minister of National Health and Welfare or the Minister or Consumer and Corporate Affairs provide the information to the committee so that all members would have an opportunity to view first-hand the cost implications of Bill C-22.
It is a further example of the Conservative majority on that committee, the Conservative majority in the House, trying to hoodwink Canadians into believing that the amendments in Bill C-22 will have a positive effect upon senior citizens and disabled people in Canada.
I call upon the Government to provide the necessary information so that Canadians can judge the ruthless type of action the Government is taking.


CANADA POST CORPORATION
Mr. Ross Belsher (Fraser Valley East):: Mr. Speaker, recently I received a letter from a constituent of mine in
Sardis, British Columbia, who has a very legitimate concern about delivery of a registered letter.
My constituent sent a registered letter to the RCMP in Vancouver after receiving what he assumed was the correct address from the local RCMP detachment. Four days later he was notified by a card that he had a registered letter awaiting him at the Sardis Post Office. He was more than a little surprised to find that his registered mail was actually the letter he had sent to the Vancouver RCMP. Marked on it were the words: "Moved, address unknown".
The registration fee of $2.46 was not refunded to my constituent even though the letter was never delivered to the RCMP office. I am sure it would have been extremely easy for the letter to be routed to the proper address when it arrived in Vancouver. After all, the RCMP are a highly visible group.
I wonder what would happen if Canada Post adopted and practised a familiar slogan-"satisfaction guaranteed or your money refunded".


INDUSTRY
Mr. Derek Blackburn (Brant):: Mr. Speaker, yesterday a lumber supplier called to tell me that he was going out of business because of the Government's softwood lumber export tax. This particular supplier created jobs by selling Canadian lumber in the United States. He bought most of the lumber from mills in New Brunswick which are supposed to be exempt from the tax. However, because he brought that lumber through his yard in Ontario, the Government hit him with its export tax.
He called Revenue Canada to ask for an exemption. He sent invoices and bills of lading to show the origin and destination of each load of lumber. However, the Government would not listen.
He could avoid the tax by telling the mill in New Brunswick to ship lumber directly to his customers in the United States, but the mill would only take those customers for its own wholesale business. His orders are being cancelled as his customers find out that his price is rising 15 per cent. He must either move his business to the United States or shut his doors. Either way, the softwood lumber export tax has killed a small business in my riding and put Canadians out of work.
February 18, 1987

[ Translation]


CANADIAN NATIONAL RAILWAYS
Mr. Guy St. Julien (Abitibi):: For several months, Mr. Speaker, the residents of Abitibi-Temiscamingue, Chapais and Chibougamau, strongly supported by various local interest groups such as mayors, chambers of commerce presidents, businessmen, CN employees and other people, have been urging the CN to impose a moratorium on lay-offs and provide better service.
Here are a few examples of bad service: On January 24, 26 and 27, 1987, Senneterre-Garneau train No. 830 was cancelled because no locomotive was available. That is the kind of service we get back home. We have asked CN management to impose a four-month moratorium on lay-offs, long enough to study the problems experienced by the railway company.
The CN's February 13, 1987 answer to our request is unacceptable.
Surprisingly enough, Mr. Speaker, yesterday, February 17, President and Chief Executive Officer Ron Lawless announced the beginning of a comprehensive study on the company's administrative structure. The memorandum reads as follows: The study is being made by a select group of senior officials assisted by the Booz-Allen and Hamilton consulting firm. Over the coming weeks agents of the consulting firm, accompanied by representatives of the services involved, will visit network facilities to observe and define the CN administrative process.
Hopes are now being dampened by some CN heads, but when reservations are expressed about the Abitibi-Temiscamingue region, I stand up and fight back.


SOCIAL SECURITY
Mr. Jean-CIaude Malepart (Montreal-Sainte-Marie):: Mr. Speaker, in a few hours the Minister of Finance (Mr. Wilson) will make his third Budget presentation. We should say his third and a half Budget.
Mr. Speaker, I would suggest that elderly Canadians have every right to expect the Government to redress some of its injustices towards them ever since the Conservative Government was elected in 1984. Naturally, I am referring to making all persons living alone, and all others who are single, separated or divorced eligible for the spouse's allowance; second, reimbursing immediately the 35,000 early retiress who have been deprived of their unemployment insurance benefits; third, continuing a real reform concerning retirement policies, the indexation of private pension plans, and increasing public assistance benefits; fourth, as promised by the Government in
1984, making sure that the three million homemakers will be covered under the Quebec and Canada Pension Plans; and fifth, with respect to family policies, restoring the full indexation of family allowances.
Mr. Speaker, I conclude by expressing the hope that at 4.30 this afternoon the elderly and families in Canada will hear good news.


CANADA WINTER GAMES
Mr. Lawrence I. O'Neil (Cape Breton Highlands-Canso):: Mr. Speaker, on Friday I predicted that Sunday's official opening of the 1987 Canada Winter Games would be the best ever, and it was. We were honoured by the Prime Minister's (Mr. Mulroney) presence and that of his wife. Cape Breton has warmly welcomed our Prime Minister and looks forward to his return.
Yesterday the very competent, capable, and athletic Minister of State for Sport (Mr. Jelinek) officially opened the ski venue at Cape Smokey, Victoria County. Hundreds of volunteers from Victoria County are working to ensure that the ski events go well, and they are, Mr. Speaker.
The people of Cape Breton have reason to be proud. More than 6,000 volunteers are participating in the operation of the Games. As part of the celebrations a cultural festival is also being held. The talent of our region is being put on national display. I want to congratulate my constituents and all Cape Bretoners for this great start. I am proud to say that I represent Cape Breton.


PESTICIDES
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, Members know that farmers do not have the time or the money to fight the farm chemical manufacturers in court when pesticides do not do the job. Many farmers have written to me about this problem expressing their frustration. One farmer writes:
I believe you re right when you. say the problem is widespread, only we seem to have no recourse.
Another farmer didn't bother to fight back. He said:
I feit I would be at great odds to do so.
Yet another farmer said the following:
February 18, 1987

We had very poor results ... Their representative acknowledged the poorness of the results, but only offered us three pails (of chemicals) to compensate for the poor results ... We told him where to put the three pails.
It is a widespread problem, Mr. Speaker. I call upon the Government to set up a tribunal if the farm chemical manufacturers will not set up a voluntary complaint mechanism themselves that puts farmers on an equal footing with the companies. The industry needs to have a code of conduct for dealing with complaints from farmers who are the consumers. Farmers have been pushed around for far too long by the large multinational chemical companies in Canada.


INDUSTRY
Mr. Brian White (Dauphin-Swan River):: Mr. Speaker, the announcement in Winnipeg yesterday of the sale of Versatile Farm Equipment to Ford New Holland is of major national significance. The decision reached by Versatile, and announced by the Minister of Regional Industrial Expansion (Mr. Cote), ensures the long-term use of the Winnipeg plant for design and manufacture of the four-wheel drive tractor, and grain swathers, and creates a world mandate for these products. The federal Government is contributing with a repayable loan of $45.5 million.
Ford New Holland will maintain the Versatile name, identity, colours, and the dealer network. Spare parts will continue to be available and warranties will be honoured. Nine hundred and fifteen people will be at work by the end of 1987, and 1,233 by 1991. Farmers will benefit from the continued competitiveness of the market.
The federal Government was applauded by management and labour for its integral role in the negotiations and, it was acknowledged that without federal government participation the sale would not have taken place.
This announcement proves what can be accomplished when management, labour, and the federal Government work together in the interests of Canada.


TOURISM
Mr. Fernand Robichaud (Westmorland-Kent):: Mr. Speaker, last Tuesday I said in the House that since the Conservatives came to power, taxes on gas had increased 10
per cent. Mr. Speaker, I'm afraid that is not correct, although it was not my intention to mislead the House.
In fact, federal excise tax has gone up from 1.5 cents per litre to 4.5 cents per litre, an increase of 300 per cent, and federal sales tax, which also affects the price of gas, has gone up from 9 per cent to 12 per cent, an increase of 33 per cent.
This means that federal taxes on gas have increased almost 100 per cent, rising from 4.1 cents per litre to 8.0 cents per litre. It means that Canadians and tourists visiting Canada by car are paying 10 per cent more for gas as a result of the taxes imposed by this Government.


HISTORIC EVENTS
Mr. Bill Attewell (Don Valley East):: Mr. Speaker, just three years after the genocide of 1915, surviving Armenians defeated the Turkish army and set up an independent state on May 28, 1918. In 1920 the Treaty of Sevres signed by Turkey and the Allies enlarged the independent Armenia to include most of its historical territory. The treaty, however, was never ratified.
Armenia was independent until December 2, 1920, when Turkey and the Soviet Union invaded and crushed the infant republic and shattered the dream of the Armenians to be a freedom-loving democracy. Sixty-six years ago today, on February 18, 1921, their dream was revived when the Armenians revolted against the communist invaders. Sadly, the revolt lasted only 90 days, but the dream of the Armenians to have the genocide of 1915 recognized and to have an independent Armenian state established will never be crushed.


EXTERNAL AFFAIRS
Ms. Pauline Jewett (New Westminster-Coquitlam):: Mr. Speaker, we in the New Democratic Party have often raised questions in this House about the export of Canadian arms and military related goods. We are especially concerned about Canadian exports to military regimes with records of gross human rights violations, and about the role of Canadians in supplying military goods to groups such as the Contras and to countries at war. We are equally concerned about the federal Government's promotion of sales of Canadian military goods to Third World countries which also receive official development assistance.

February 18, 1987
Oral Questions
Yesterday I wrote the Secretary of State for External Affairs (Mr. Clark) in response to his request for New Democratic Party assistance, urging him to initiate a full public inquiry into such Canadian exports. I have suggested specific areas for careful study and government action. The matter is urgent. I trust the Minister will respond favourably to my suggestions.
* *
*


PORNOGRAPHY
Mr. John Reimer (Kitchener):: Mr. Speaker, according to an article in the February 17 edition of the Kitchener-Waterloo Record, Ms. Maud Barlow, who is seeking the Liberal nomination for Ottawa Centre, told an audience of 500 high school teachers that she is "dead against free trade" because, she alleges, it will open Canada's borders to pornography and sexual violence from the United States. I welcome and share Ms. Barlow's concerns with respect to pornography and sexual violence, as does the Government. However, I take strong exception to Ms. Barlow's unwarranted linking of pornography and the Canada-U.S. trade talks. There is absolutely no connection whatsoever.
The Criminal Code is not up for negotiation, nor will it ever be. Furthermore, Article 20 of the GATT permits every sovereign state to restrict any trade which affects public morality and safety. If the Liberals want to discuss free trade, then let them do so in an intelligent and constructive fashion without resorting to this pathetic example of unacceptable fear-mongering and blatant electioneering.
through the revolving door well known to 10 other Conservative Ministers.



ORAL QUESTION PERIOD


Right Hon. John N. Turner (Leader of the Opposition):: Mr. Speaker, in the absence of the Prime Minister I will direct my question to the Deputy Prime Minister. Yesterday in this House, when referring to the fishing treaty between Canada and France, the Prime Minister said, and I am quoting from page 3521 of Hansard'.
The Government of Canada and the Parliament of Canada alone will speak for Canada in all matters under our jurisdiction.
That was quite clear. Last night, on his private Newfoundland cable outlet, the Minister of Transport is reported to have said: "The issue will be up for discussion in the next round of constitutional talks." Here are his words: "I think there is a strong argument for shared jurisdiction. There are difficulties but we are certainly prepared to discuss them when there is another round of constitutional negotiations."
Was the Minister of Transport distracted yesterday when the Prime Minister slammed his desk while staking out the rights of the Parliament and Government of Canada? Is it a matter for Parliament alone or is it going to be, as the Minister
Transport indicated, a matter for shared jurisdiction?


CALL FOR GOVERNMENT ACTION
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, it has now been seven months since the Minister of State for Youth (Mr. Charest) was appointed to his job. His only accomplishment in that time has been a glossy booklet cataloguing existing youth programs, most of which were introduced by Liberal Governments. While such a booklet has some value, it is no substitute for policies and action to deal with the real problems of youth. Once again Conservatives are relying on rhetoric and public relations.
The rate of unemployment for youth is now at 14.4 per cent. Since 1984 the Tories have cut over $200 million from youth programs. This is no time for complacency and smugness as demonstrated by the Minister of State for Youth on Monday. Let us have some action from this Minister or discard him
Hon. Don Mazankowski (Deputy Prime Minister and President of the Privy Council):: Mr. Speaker, if the Right Hon. Leader of the Opposition did his homework he would know about the meetings which took place at the annual Premiers' Conference in Edmonton from August 10 to August 12. The communique said: "There was consensus among the Premiers that they will pursue further constitutional discussions on matters raised by some provinces which will include, amongst other issues, Senate reform, fisheries, property rights," et cetera.


Mr. Crosbie:: Wake up, John.


Donald Frank Mazankowski: Furthermore, on November 21 the communique issued at the annual First Ministers' Conference in Vancouver, British Columbia, indicated that: "There was agreement to undertake later another stage in constitutional reform on matters that will include, amongst other things, Senate reform, fisheries, property rights," et cetera.


John Carnell Crosbie: Wake up, John.
February 18, 1987


John Napier Turner: The Minister of Transport says "Wake up, John". Why don't you go back to sleep, John?


OVERFISHING BY FRENCH VESSELS
John Napier Turner: Mr. Speaker, what was the Prime Minister saying when he said in this House it is a matter for Parliament and Parliament alone? In this bizarre personal letter-


John Carnell Crosbie: Rip Van Winkle! You have been asleep for 12 years.


John Napier Turner: -that the Prime Minister wrote to the Minister of Transport regarding the fishing agreement with France, he said the negotiations with France will address "overfishing in the disputed zone".


John Carnell Crosbie: Absolutely.


John Napier Turner: Even the Minister of Transport knows that the disputed zone is the 200-mile zone disputed by France and Canada around St. Pierre and Miquelon. Is that statement true and, if so, on what clause of the agreement with France was the Prime Minister basing that statement?


Donald Frank Mazankowski: Mr. Speaker, the Prime Minister was very clear and there is no question about that. This Government has always worked together with the provinces on issues such as energy, fisheries, forestry, and things of that nature.
With respect to the second part of the question and overfishing, perhaps I might enlighten the Right Hon. Leader of the Opposition and quote from the letter that the Prime Minister sent to the Minister of Transport. It says as follows: "Any further agreement to allot cod to France in the Canadian fishing zone will be dependent upon, (a), France agreeing to binding arbitration on the boundary in the disputed zone and, (b), joint agreement on a total allowable catch for the fishermen in the disputed zone during the period of arbitration in order to solve the problem of overfishing."


CANADA-FRANCE AGREEMENT
John Napier Turner: Mr. Speaker, the problem with that is that it does not accord with the agreement between France and Canada. The agreement says "the parties will meet in order to initiate negotiations establishing the annual fishing quotas for French vessels in Canadian waters"-not "disputed waters" but "Canadian waters".


John Carnell Crosbie: We say they are Canadian.


John Napier Turner: The Deputy Prime Minister seems to be sadly ill-informed on this issue.
Oral Questions


Some Hon. Members:: Oh, oh!


John Napier Turner: I ask him, has Canada not waived its rights to contest French overfishing in disputed waters, that 200-mile limit around St. Pierre and Miquelon, by the very wording of the treaty with France?


Donald Frank Mazankowski: Not at all.


John Napier Turner: Is that not the case? If it is, it is a lousy agreement.


Donald Frank Mazankowski: Not at all.


Hon. Thomas Siddon (Minister of Fisheries and Oceans):: Mr. Speaker, of course that is certainly not the case. If one reads what the Right Hon. Leader of the Opposition quotes from we see that it says, "a proces-verbal establishing the annual fishing quotas for French vessels in Canadian waters for the period 1988-1991 inclusive" shall be the subject of the interim agreement.

Canadian waters are those waters which we claim in the area 3PS. If it were not for his old friend, the mischief maker in the other place who set him up for this question, who, along with the Hon. Member, was an architect of this infamous 1972 treaty, we would not have a problem today.


Some Hon. Members:: Hear, hear!


John Napier Turner: Read your agreement.


ALLOCATION OF FISH QUOTA TO FRANCE
Mr. George Baker (Gander-Twillingate):: Mr. Speaker, how much more confusion can the Government heap on an already confusing situation? Cabinet Ministers have stood in this House, as all Members know, and said that not one more fish will be given to France unless Newfoundland agrees. The Prime Minister stood in the House yesterday and made a 180 degree turn to the right, to the starboard, and said that Newfoundland has no veto.
Is the Deputy Prime Minister aware that the Minister of Transport said that no fish will be given to France unless Newfoundland agrees? He said it must be in the best interests of the people of Newfoundland '"or there will be no deal'. Eat your heart out!" Are the Deputy Prime Minister and the Prime Minister now saying to the Minister of Transport, "Eat your own words"?


Some Hon. Members:: Hear, hear!


John Napier Turner: Get back to wheat.


Donald Frank Mazankowski: Mr. Speaker, the Right Hon. Leader of the Opposition suggests that I should get back to wheat. I know a hell of a lot more about wheat than he does, and I know more about fish than he does.

February 18, 1987
Oral Questions


Some Hon. Members:: Hear, hear!


Mr. Speaker:: For several days Members have been using the word "hell". I ask all Hon. Members to keep in mind that that may well be offensive to others and to the public which is watching, no matter what the public may sometimes think of this place.


Donald Frank Mazankowski: Mr. Speaker, to answer the Hon. Member's question I will again quote the Prime Minister's letter as follows: "What are our objectives? First and foremost to reach agreements that will defend in advance the interests of the Canadian Fishing industry in Newfoundland and throughout Atlantic Canada".


SHARED JURISDICTION INQUIRY
George Baker: Mr. Speaker, the only significant achievement of the Government in this French fishing fiasco is that today it has apparently convinced the Premier of Newfoundland to stop barking at Ottawa. The Premier of Newfoundland now agrees with the Minister of Transport. The Minister of Transport agrees with the Premier of Newfoundland.


Some Hon. Members:: Hear, hear!


John Napier Turner: That's a great accomplishment.


George Baker: Mr. Speaker, on this issue two Tories don't make a right.
I will direct my question to the Minister of Transport who has been assigned by the Prime Minister to answer for Newfoundland on this issue. What is meant by "shared jurisdiction"? What line did this Minister feed the Premier of Newfoundland to stop him from barking?


John Carnell Crosbie: Mr. Speaker, the hon. gentleman is as angry as a dogfish at the fact that the Premier of Newfoundland and I are heart-to-heart and mind-to-mind on this issue now.


Some Hon. Members:: Hear, hear!


Mr. Murphy:: Cheek-to-cheek.


John Napier Turner: Cheek-to-cheek and jowl-to-jowl.


John Carnell Crosbie: I assume that the Hon. Member is delighted that we are prepared to do what the Premiers requested some months ago after the First Ministers' meeting, that is, to discuss the fisheries question when the next major round of constitutional negotiations begins. That is our commitment. We know that the Liberal administration in the past would not do it. I doubt whether the next ones in the 21st century will.


Some Hon. Members:: Hear, hear!


CANADA-FRANCE ECONOMIC AGREEMENT
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, I can tell the Minister that he better check with the Premier of Newfoundland. He no more likes the substance of this agreement than do other Newfoundlanders, except the Minister. He joins the Opposition in condemning it outright.


John Carnell Crosbie: We will see you in the by-election.


John Edward Broadbent: My question is directed to the Secretary of State for External Affairs. I have a copy of a document that was produced recently by External Affairs and which perhaps goes a long way to explaining the sell-out of the Newfoundland fishery. It refers to a historic agreement that was negotiated between the Government of Canada and the Government of France last month as: "The most important economic agreement signed by Canada and France in recent years". This External Affairs document refers not to the cod agreement but to another agreement on trade with France being negotiated at the same time. Will the Minister confirm to the House that the reason the Government sold out our cod interest in Newfoundland was to get this agreement on other matters?


Right Hon. Joe Clark (Secretary of State for External Affairs):: Mr. Speaker, both accusations of the Hon. Member are false, as usual.


Some Hon. Members:: Hear, hear!


GOVERNMENT POSITION
John Edward Broadbent: Mr. Speaker, we see how the Minister deals with a document produced by his own Department. According to his Department, this is a historic document on a trade agreement between Canada and France designed to promote joint ventures, investment activities, and the transfer of technology. Will the Minister confirm that in order to get an agreement on all these matters, the Government of Canada was quite prepared to sell out to France with what they wanted on the cod deal?


Charles Joseph Clark: Mr. Speaker, the document issued by External Affairs is quite correct. What is false is the statement of the Leader of the NDP. What is reprehensible is that he should try to insinuate this kind of accusation into this debate. He should be above that kind of thing.


John Edward Broadbent: That is really touching.


NEWFOUNDLAND PREMIER'S LETTER
John Edward Broadbent: Mr. Speaker, will the Secretary of State for External Affairs confirm that the Prime Minister received a letter from Premier Peckford in December urging the Government of Canada not to make concessions in the cod area in order to obtain this kind of agreement? Will he confirm that the Government of Newfoundland was deeply concerned and expressed its concern in advance that its
February 18, 1987

interests as a maritime province would be sold out by the Government in order to get this agreement? Is that not the concern Mr. Peckford expressed? Is that not the concern which the Government deliberately ignored?


Charles Joseph Clark: Mr. Speaker, for the third time the Hon. Member is peddling a falsehood.


Some Hon. Members:: Oh, oh!


John Edward Broadbent: That is close.


Some Hon. Members:: Order.


Mr. Speaker:: I think the Hon. Minister has indicated that he is not in agreement with what the Hon. Leader of the New Democratic Party said. One might say that he is getting very close to suggesting that the Hon. Leader of the NDP is a peddler in falsehood, but I think the intention was that the Minister did not agree with the suggestion being made. However, it is an indication of the difficulty in which it puts the Chair and I am sure the Hon. Minister would want to indicate to the House that he did not intend that the Leader of the New Democratic Party was intentionally misleading the House.


An Hon. Member:: Take the high road, Joe.


John Edward Broadbent: Be a statesman, Joe.


Charles Joseph Clark: Mr. Speaker, the Leader of the New Democratic Party was exercising a terminological inexactitude.


Some Hon. Members:: Oh, oh!


Mr. Nunziata:: You are no longer a wimp, Joe. You are in the big leagues now.


An Hon. Member:: Joe for Prime Minister.


Mr. Speaker:: Order, please. I know Hon. Members are waiting in expectation for the next exchange.


THE CABINET
Mr. Jacques Guilbault (Saint-Jacques):: Mr. Speaker, yesterday, when I was asking the Prime Minister wheher he had made a decision with respect to his Minister of State, the Hon. Member for Joliette, I believe it would not be exaggerating to say that the Prime Minister lost his temper when he said that I was indulging in calumny and character assassination.
Oral Questions
Today, my question is directed to the Deputy Prime Minister. Considering reports that the Minister of State handed in his resignation to the Prime Minister, doesn't the Deputy Prime Minister feel the Canadian public has a right to expect the Government to react quickly in this respect and inform the House as soon as possible whether the Minister will or will not remain in Cabinet?


Donald Frank Mazankowski: Mr. Speaker, I think the Hon. Member, and I am sure other Hon. Members, would agree that whatever discussions, if any, that may be taking place between the Prime Minister and the Minister of State are a matter between them. The Prime Minister clearly has prerogative in this particular area. If any decisions are to be taken, I am sure they will be taken in due course.


REQUEST FOR DECISION BY PRIME MINISTER
Jacques Guilbault: Mr. Speaker, what is troubling is that the Minister of State is also reported as saying that there will be no decision in his case until the end of the month when he will meet again with the Prime Minister. Does the Deputy Prime Minister not think that it is about time that his Prime Minister showed some leadership instead of indecisiveness in this case, and that he help to clear the air quickly and let Canadians know whether or not the Minister will stay in cabinet?


Donald Frank Mazankowski: Mr. Speaker, with all due respect to the Hon. Member, I think it is about time that he stopped relying on newspaper reports as his research facility. It is my understanding that again we have had a series of allegations levelled at the Minister of State which have been refuted. As a matter of fact, it is my understanding that reporters from the Canadian Press have phoned his office this morning and apologized for the fact that some of the statements are inaccurate and could not be confirmed.


PRIME MINISTER'S POSITION
Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, my question is directed to the Deputy Prime Minister and also refers to the Hon. Member for Joliette. There are some questions surrounding the handling of this issue. Once certain allegations regarding the Minister of State for Transport were brought to the Prime Minister's attention he ordered an immediate investigation by the RCMP and took action by asking for his resignation. We all agree that that was the appropriate step to take. When the matter regarding the $5,000-a-plate dinner was brought to the Prime Minister's attention he also ordered an RCMP investigation, yet did not ask for the Minister's resignation. Will the Deputy Prime Minister explain the difference in the two cases? Why did he act with haste in asking for the resignation of the Minister in one case but did not and still does not in the other case?

February 18, 1987
Oral Questions


Donald Frank Mazankowski: Mr. Speaker, I find it incredible that the Hon. Member opposite keeps asking the same question. That question has been asked three, four or five times, and has been answered each and every time by the Prime Minister. I invite him to go back and read the answers.


Nelson Andrew Riis: I have read each of those responses and at this point I do not recognize the difference in the two cases.


Mr. Andre:: Keep throwing mud.


DECISIONS CONCERNING MINISTERS
Nelson Andrew Riis: Mr. Speaker, if it is clear, will the Deputy Prime Minister please explain succinctly and clearly the difference in the two cases?


Donald Frank Mazankowski: Mr. Speaker, I am not sure, but I think there is a rule in this House which says that questions which are repetitious or out of order-


John Edward Broadbent: No.


Donald Frank Mazankowski: This is exactly the same question as the first question.


Some Hon. Members:: No.


Donald Frank Mazankowski: It is exactly the same question which was asked in the House on several occasions and exactly the same question the Prime Minister answered.


Mr. Speaker:: I would like to bring to the attention of Hon. Members that it has often been suggested in past practice that the same question ought not to be repeatedly asked. In the event the same question is asked, the Minister is under no obligation to answer. The difficulty, of course, is that there will be an argument, or often is, between the Minister and the Member asking it as to whether or not it is the same question.
However, a Minister, who is in the position of believing the question has been asked before, is under no obligation to answer it, and that is the rule.


CANADA LANDS COMPANY JOBS
Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, my question is directed to the Deputy Prime Minister. It concerns the administration of the Government. Newspaper reports today suggest that the cousin of the former Minister of Public Works, the Hon. Member for Joliette, was appointed to run the Canada Lands Company; the Minister's former chauffeur got a job as an officer manager with the corporation, and another friend of the Minister, who was convicted of fraud, was also rewarded at the Canada Lands Company. Besides asking the Deputy Prime Minister what qualifications these people have, I ask specifically, was he or
the Prime Minister aware of these facts? And what steps, if any, were taken to correct this outrageous situation?


John Carnell Crosbie: Mr. Speaker, I am happy to have the opportunity to clear up some of the inaccuracies and false statements made in this Canadian Press story. It seems it is becoming its practice.
By the way, 71 per cent of the people of that district voted for the Hon. Minister of State without portfolio. Is it any wonder that some appointments down there are people who supported him? What false reasoning and slanderous kinds of accusations to make!


Some Hon. Members:: Hear, hear!


John Carnell Crosbie: With respect to this matter, it is the municipality at Joliette which made a decision on what consulting firm to hire to do a certain feasibility study. The site of the land which was decided upon as being the best land is owned by Air Joliette Incorporated, not by Pierre Perrault. There is a whole series of other inaccuracies all strung together to make matters look bad for the Minister of State without Portfolio. It is scandalous for the Hon. Member not to do any checking, then to use false statements made in the Canadian Press story and repeat them in this House, hoping they will get more circulation as a result.


Some Hon. Members:: Hear, hear!


Some Hon. Members:: More, more!


Don Boudria: Mr. Speaker, it was to be expected that this particular Minister would stand up and defend patronage in this House, for obvious reasons. I repeat to this Minister and to the Government that they have not denied the allegations I made concerning the Canada Lands Company.


GOVERNMENT APPOINTMENTS
Don Boudria: Mr. Speaker, my supplementary question is directed to the Deputy Prime Minister. Does the Government still stand by the solemn commitment made by the Leader of the Conservative Party on July 16, 1984 when he said about patronage: "We are going to bring in a brand new dimension to them of objectivity and representation and fairness for all Canadians"? Do those appointments qualify under that definition or don't they? If they don't, what is the Minister going to do to correct it?


Donald Frank Mazankowski: Mr. Speaker, in my 19 years in this House I have never seen such shameful conduct-


Some Hon. Members:: Hear, hear!


Mr. Speaker:: I ask the Hon. Minister to deal as exactly as the Minister can with the question which was asked, give a reply, and perhaps we can diminish the noise level in the Chamber just a little bit.
February 18, 1987


Donald Frank Mazankowski: Mr. Speaker, the Hon. Member knows very well that there is a process which has been set up through the process of parliamentary reform to scrutinize all government Order in Council appointments. If the Hon. Member has something to raise about this or any other appointment made by this Government, that is the place to do it, not the way he does it here under the screen of allegations, innuendoes, and smear.


Some Hon. Members:: Hear, hear!


ENVIRONMENTAL AFFAIRS
Mr. Bill Blaikie (Winnipeg-Birds Hill):: Mr. Speaker, 1 have a question on another subject altogether, if I might be so bold. It concerns something far more important, the survival of the Canadian environment. My question is directed to the Secretary of State for External Affairs and has to do with remarks made by the American Interior Secretary, Mr. Hodel, now complemented by remarks by Congressmen John Dingell, having to do with the fact that Canada's concern for acid rain abatement in the United States can be reduced to a conspiracy on our part to sell more hydro power to the United States. Would the Secretary of State for External Affairs say in this House, here and now, on behalf of all Canadians, and clearly to our American neighbours, that that is a lie?


Charles Joseph Clark: Mr. Speaker, that would be unparliamentary.


Some Hon. Members:: Oh, oh!


Charles Joseph Clark: But it is certainly false.


William Alexander (Bill) Blaikie: Mr. Speaker, as far as I know the rules do not prohibit the Secretary of State for External Affairs from saying things about people outside this House.


Mr. Speaker:: One can take judicial notice in this Chamber of the very intense feelings of Canadians with respect to the acid rain problem. There is, of course, a rule that certain things ought not to be said about representatives of a friendly country and I would ask the Hon. Member to keep that in mind.


William Alexander (Bill) Blaikie: Well, you have to wonder who your friends are when they continue to poison your environment the way the Americans are poisoning ours.


CANADIAN POSITION
William Alexander (Bill) Blaikie: Mr. Speaker, given the fact that we have tens of thousands of lakes which are already dead or dying, that our water-fowl are dying, and that our forest growth has been reduced by 66 per cent, what
Oral Questions
other avenues does the Government have in mind, litigatious or otherwise? We know the Americans were able to reach a deal with Mexico on the basis of a court case brought by six asthmatic Americans. Is the Government considering any new action in this regard which might bring the Americans to the table, admit we have a problem, and get down to serious acid rain abatement on the other side of the 49th parallel?


Hon. Tom McMillan (Minister of the Environment):: Mr. Speaker, the short answer is that the Americans are already at the table. The Prime Minister of Canada will be raising at the forthcoming summit in Ottawa with the President of the United States, just as he has done so at the two previous summits, Canadians' grave concern about the pollution of the environment by American sources of acid rain-causing emissions.
May I say while I am on my feet, Mr. Speaker, that though I share the Hon. Member's concern and, indeed, outrage, at the utterances of people like Mr. Hodel, I think it is inaccurate to draw a parallel between the all-encompasing agreement we are seeking with our American neighbours, on the one hand, and that which the Americans have reached with the Mexicans. All the requirements in connection with the U.S.-Mexico agreement are imposed on Mexico, not on the United States. That is exactly the opposite of what we are seeking.


NATIONAL PAROLE BOARD
Mr. Geoff Scott (Hamilton-Wentworth):: Mr. Speaker, the entire region of Hamilton-Wentworth and I have given notice of the following question which is directed to the Solicitor General.
In view of the parole of Dominic Musitano two years after a court sentenced him to six years' imprisonment as an accessory after the fact of an organized crime murder, and since Musitano was granted parole despite warnings by the Hamilton Police Department that "He represents a threat to the citizens of this region", and despite the objections of the area manager of the Parole Division of Correctional Services that "We do not believe he is a candidate for early release", and despite community concerns that such a release jeopardizes the safety of law-abiding Canadians, why has this man been paroled?


Hon. James Kelleher (Solicitor General of Canada):: Mr. Speaker, I can advise the Hon. Member that under the law Mr. Musitano was in fact eligible for parole. It was a decision of the National Parole Board which has exclusive jurisdiction in these matters. I cannot in any way overturn, overrule, or amend its decisions. I have asked for a copy of the decision,

February 18, 1987
Oral Questions
and hopefully I will be able to give the Elon. Member further information once I have had an opportunity to review it.


CAPE BRETON DEVELOPMENT CORPORATION
David Charles Dingwall: Mr. Speaker, my question is directed to the Minister of Regional Industrial Expansion. In early February I wrote to the Minister and asked him to exercise his ministerial authority to intervene and prohibit the termination of 480 jobs at the Cape Breton Development Corporation. I wish to ask the Minister what actions he is planning to take, or has taken, with regard to protecting 480 jobs in a sector of the Nova Scotia economy that needs those jobs?


Hon. Michel Cote (Minister of Regional Industrial Expansion):: Mr. Speaker, since my hon. friend is from that region, he is well acquainted with the coal industry. He is also aware that at the present time, the industry has considerable excess capacity, which has of course led to a drop in prices. As a result, the industry has new problems to cope with, and this is a fact of life in a competitive market. It must proceed with certain adjustments.
Consequently, the company made a very generous offer to its workers, an offer that was initially rejected, but if I am not mistaken, the conciliator appointed by the Department of Labour is still trying to arrange meetings and arriving at a conciliation decision. Therefore, Mr. Speaker, I think it would be inappropriate to discuss the matter further at this time.


REQUEST THAT LAY-OFFS BE HALTED
David Charles Dingwall: Mr. Speaker, my supplementary question is directed to the same Minister. There is not an excess capacity. In fact what is needed is more jobs in the coal industry in order to perform the work which is required.
I wish to ask the Minister if he will not give a directive to the Cape Breton Development Corporation under the auspices of Section 99 of the Financial Administration Act to order management to halt these job terminations, because these job terminations will affect not only the local mining communities in that area, but as announced by the Premier, will negatively affect the entire economy of Nova Scotia. Will the Minister not do that?


Michel Côté: Mr. Speaker, it is certainly no secret, as I have said before, that the Government is concerned about this problem. We are following developments very carefully on a
daily basis, but I also want to give the Hon. Member the assurance that for some time, the Government has been very much aware of the situation of workers in the Maritimes, and especially those from Cape Breton. We will do everything we can to create opportunities for easier access to new jobs.


STATUS OF WOMEN
Ms. Margaret Mitchell (Vancouver East):: Mr. Speaker, my question is directed to the Secretary of State. Why did the Minister bow to political pressure to retroactively fund the Alberta Federation of Women United for the Family under Secretary of State women's program funding when this group had already financed their conference, when it is doubtful that they qualified as a "Status of Women" group, and when they now intend to use the $8,000 for an anti-abortion campaign? Why did the Minister do this?


Hon. David Crombie (Secretary of State of Canada):: Mr. Speaker, the grant that I think the Hon. Member is talking about was clearly within the guidelines laid out by the program.


AWARDING OF GRANT
Margaret Anne Mitchell: I wonder if the Minister has listened to his own Deputy who came to the Secretary of State Committee and told us that under no circumstances are any issues related to abortion fundable under the Secretary of State Women's Program criteria? What does the Minister intend to do about this misuse of Secretary of State funds?


David Edward Crombie: Mr. Speaker, if it is the grant that I think the Hon. Member is talking about, it is a grant within the program. It would be absolutely wrong for me, or for any other Minister, not to treat everybody fairly when they come forward with a request for a grant.


CANADA POST CORPORATION
Mr. Alfonso Gagliano (Saint-Leonard-Anjou):: Mr. Speaker, my question is directed to the Minister responsible for Canada Post. In a letter dated February 11, Andre Villeneuve, Vice-President for Corporate Communications at
February 18, 1987

Canada Post said and I quote: "Over the next 10 years, we will be shifting most of our retail services to the private sector". Does the Minister agree with Canada Post's plan to close the majority of the post offices across this country?


Harvie Andre: I think that was a non sequitur, Mr. Speaker. I do not see how privatizing certain activities has anything to do with closing or not closing post offices. They are two separate questions.
It has been agreed by everybody who has looked at the Post Office that there can be genuine improvements in services to the public while saving money through the contracting out of some of the activities of the Post Office. That policy will continue.


CORPORATION'S INTENTIONS
Alfonso Gagliano: Mr. Speaker, if there is no intention of closing post offices, then why did Mr. Villeneuve inform me in the same letter that Canada Post will consult the residents to establish what type of a service they prefer to receive in replacement of the existing post offices? Why does the Government wish to close post offices that are giving good service, especially in rural Canada? Why does the Government wish to close that service?


Harvie Andre: Mr. Speaker, perhaps I could give an example to the Hon. Member. On Monday this week on the Ottawa River at Dunrobin two post offices were merged together with the enthusiastic approval of all the people concerned because it resulted in improved service to the people affected. Why in heaven's name would the Hon. Member suggest that the Post Office should not go through that type of rationalization and merging two smaller, less efficient operations into one more efficient operation which improves service? Why does the Hon. Member keep asking that we not allow that type of thing to happen?


FUTURE OF RURAL POST OFFICES
Mr. Cyril Keeper (Winnipeg North Centre):: Mr. Speaker, I have a supplementary question with regard to the closure of rural post offices. Yesterday at the Government Operations Committee the Chairman of the Committee and member of the government Party said, "I have it on pretty good authority that Canada Post will resubmit its plan to Committee to back off on its amalgamation formula". Is the Minister now ready to say that the Government is ready to back off on its plans to close hundreds of rural post offices? Will the Minister clear up the confusion in this area?
Hon. Harvie Andre (Minister of Consumer and Corporate
Affairs): Mr. Speaker, one of the causes of the confusion is activities like those that occurred in Devon last weekend where the Hon. Member attended with some people who have other
Oral Questions
objectives in mind, and who were making outrageous statements about the closures of post offices in Devon, Calmar, and other places, which was unnecessarily enraging and causing concern to the people affected, when the Hon. Member knows that there are no such plans in mind.


AMALGAMATION PLANS
Cyril Keeper: Mr. Speaker, my supplementary question to the Minister is this. The President of Canada Post has admitted before the Government Operations Committee that it has plans to close hundreds of rural post offices under the amalgamation plans which are in the Post Office plan. Is the Minister now ready to say that he will abandon those plans, and that the Government will bring in a new plan for the Post Office? Will the Minister be frank with Canadians?
Hon. Harvie Andre (Minister of Consumer and Corporate
Affairs): Mr. Speaker, what I am prepared to be frank about is the Hon. Member and his objectives of trying to raise fear and anxiety with his distortion of facts and distortion of intent, and he is not contributing at all to what we should collectively share as our responsibility to the people who elected us to see that the Post Office does the best job possible.
As I indicated, the kind of assurance he just asked for would have in fact made it impossible to have the merger of two post offices near Ottawa, which was announced on Monday and was greeted positively by the people affected. For goodness sake, I would ask the Hon. Member to be reasonable in making those kinds of suggestions and demands.


CORRECTIONAL SERVICES CANADA
John V. Nunziata: Mr. Speaker, my question is for the Solicitor General. It concerns the decision to fund and locate the Exodus Link parole supervision facility in Parkdale in Toronto without regard to its impact on the community. The Minister knows that the decision was taken in a sneaky, surreptitious fashion, with absolutely no consultation with the local community. In view of the concerns expressed by the community, will the Minister reconsider the decision to fund that particular operation, and will he refer the issue to the Justice Committee for further consideration to allow interested parties an opportunity to express their points of view?


James Francis Kelleher: Mr. Speaker, as the Hon. Member knows full well, I am sure, the contract was for services only. It was the responsibility of the applicant to locate the site somewhere within the city of Toronto. That in fact was determined in accordance with the

February 18, 1987
Privilege-Mr. Jourdenais
by-laws of the City of Toronto. If there is a concern, one should have resort to the City of Toronto zoning by-laws. We did not select the site. In any event, as a result of representations made by the Hon. Member for Parkdale-High Park, I listened to the representations of the residents of the area and I reduced the number of people to attend that particular facility by 40 per cent.


PRIVATIZATION OF PAROLE SERVICES-REQUEST FOR COMMITTEE REFERRAL
John V. Nunziata: Mr. Speaker, the Minister's own colleague, the Hon. Member for Park-dale-High Park, complained to him with regard to the lack of consultation with him, as the Member for the area, and with the community generally. The Minister knows that the privatization of parole services is a major departure from present government policy. In view of that fact, does the Minister not consider it appropriate for him to refer the whole issue of the privatization of parole services to the Justice Committee in order for that committee to consider the whole question?


James Francis Kelleher: Mr. Speaker, I am somewhat concerned here. I would like to know whether or not the Hon. Member is against the establishment of half-way houses so that parolees can in fact be rehabilitated, get back into the community, and reduce the rate of recidivism.


NATIONAL DEFENCE
Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, my question is directed to the Minister of National Defence and concerns the proposed F-18 firing range in the Saguenay.
The Minister is aware that the Quebec Ministers of Intergovernmental Affairs and Environmental Affairs have proposed public hearings and a joint assessment of the project's impact.
Is the Minister prepared to co-operate with this important proposal for public hearings on the proposed firing range for the region and to consider joint public hearings with the Quebec Government? Will he conduct those hearings?


Hon. Perrin Beatty (Minister of National Defence):: Mr. Speaker, we are currently having discussions with regard to this matter. As soon as we have anything to announce, I will inform the Hon. Member.


SHIPBUILDING
Mr. Ted Schellenberg (Nanaimo-Alberni):: Mr. Speaker, my question is directed to the Minister of Transport. With the sale of Versatile Farm Equipment yesterday in Manitoba to Ford New Holland, and with the ongoing financial restructuring of Versatile Pacific Shipyards in Vancouver and Victoria, can the Government of Canada now announce the awarding of the Polar 8 ice-breaker contract to British Columbia shipyards? As the people of Newfoundland would say, we in British Columbia want to know: "Who is the b'y who is going to build the boat?"


John Carnell Crosbie: Mr. Speaker, as the hon. gentleman knows, over the past several months the Minister for DRIE has performed miracles. He has straightened out the matter of Versatile's operations in Quebec. They have now straightened out the farm equipment situation in Winnipeg. We are advancing westward, and within a period of days we will be straightening out the matter of the Polar 8 in Vancouver, and I dare say we won't leave unless there is an ice-breaker left behind us.


PRIVILEGE
Mr. Speaker:: I want to draw the attention of Hon. Members to a question of privilege which was raised a few days ago by the Hon. Member for La Prairie (Mr. Jourdenais).

On February 11, 1987, the Hon. Member for La Prairie (Mr. Jourdenais) raised a question of privilege with respect to the dismissal of an official at the Department of Employment and Immigration. The Hon. Member alleged that the privileges of all Members of this House were affected by the decision and by the action taken by the Deputy Minister of the Department in question.

The Hon. Member for York West (Mr. Marchi), in his submission to the Chair, suggested that the Deputy Minister's action could lead to the withholding of information that is valuable and necessary for the Canadian public and as a consequence the very essence of why Members are elected to the House is thereby affected. The Hon. Member for Spadina (Mr. Heap) argued that the public servant in question had conversed with members of the Standing Committee on Labour, Employment and Immigration and was only making relevant information available to members of the committee.
February 18, 1987



The Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) maintained that Hon. Members should see this as an infringement of their rights and privileges. He stated that nothing should prevent Hon. Members from putting questions in the House and that Members should not have to be afraid that if they do, people who provided them with information might be fired.

At the time the Chair took the matter under advisement, and I am now ready to report to the House. I should say that this matter has given the Chair a great deal of concern.
At page 72 of the Twentieth Edition of Erskine May, the following citation is found:
Certain rights and immunities, such as freedom from arrest or freedom of speech, belong primarily to the individual members of each House and only secondarily and indirectly to the House itself; but there are other rights and immunities, such as the power to punish for contempt and the power to regulate its own constitution, which, being rather directed to the maintenance of its own collective authority than to the security of the individual members, may be said to belong primarily to each House as a collective body. This is a useful distinction, but fundamentally it is only as a means to the effective discharge of the functions of the House that individual privileges are enjoyed by its Members. The Commons, in their reasons offered at a conference with the Lords in the controversy arising from the case of Shirley vs Fagg,-
It is an old case referred to in the book from which I am quoting.
-in asserting that privilege of Parliament belongs to every Member of the House of Commons, declared "that the reason of that Privilege is, that the Members of the House of Commons may freely attend the public affairs of that House, without disturbance or interruption".
I think I will come down on what has to be the legal side of the issue, but I should say that part of the complaint of Hon. Members who raised the matter was that they felt that under the circumstances they would not be able to-and again I quote from Erskine May as I previously quoted-"freely attend the public affairs of that House, without disturbance or interruption". That is why this case is difficult. It is also why the Chair must be careful to define the issue and to make a ruling which stays within bounds.
I must underline to the House that the ancient privileges enjoyed by Members, separately and collectively, are privileges enjoyed by Members of Parliament only. Such privileges do not apply to public servants or persons outside the House, and there is no osmosis of privilege because someone transacts or converses with a Member of the House.
I have reviewed the elements of the matter raised by the Hon. Member for La Prairie, and I have found considerable difficulty in establishing evidence of a prima facie case of a breach of privilege; that is not to say that the matter is not a very grave concern.
The conversations referred to have taken place outside the House and outside the proceedings of the standing committee. The public servant was acting on his own initiative and not at the request of the committee.
Privilege-Mr. Jourdenais
The Deputy Minister appears to have acted within the authority conferred upon him by law, and in exercising that authority, in the opinion of the Chair, has not breached privilege nor impeded members in any way.
The Hon. Member for La Prairie has asked the Chair to consider and rule upon the narrow question of whether or not parliamentary privilege has been infringed in this case. On the narrow grounds upon which I must decide, I cannot find that a valid question of privilege exists.
Having said that, the broader question raised by the Hon. Member as to whether or not an injustice has occurred still remains to be answered. On that question, however at least at the moment and on the facts in front of me, I do not believe I have any authority to pronounce.

The Hon. Member may, if he so wishes, bring this matter to the attention of the Standing Committee on Labour, Employment and Immigration. However, I must advise him that he does not have a well-founded question of privilege.

I repeat, the issue raised in this matter is a serious one. In these circumstances, and on the facts, I have had to decide that it falls short of a question of privilege. But there is a fundamental question that, at the moment at least, I do not feel I can answer, namely, the question which is always with us in a democratic institution of when and under what circumstances is it appropriate for a public servant to give information to Members of Parliament or others. As the Chair understands, there is a process still going on in which it will be left for others perhaps to decide. As I have said, this is a matter that can be taken by Hon. Members to the committee.
I want to thank all Hon. Members for their interventions. I want to say again that I felt the intervention was well taken and that under the circumstances I have had to decide on the narrow point, and I have done so. The decision takes nothing away from the importance of the question and this decision in no way precludes members from taking the matter further in another place. It is not to rule one way or the other on whether under the circumstances the particular public servant is receiving, as I said earlier in the ruling, justice in the ordinary sense of that word. Again, I thank Hon. Members.


Mr. Dan Heap (Spadina):: Mr. Speaker, I rise on the same question of privilege. I thank you for your ruling in the matter, which is quite clear. I would ask whether you can give guidance to Members of Parliament, perhaps including at least the members of the committee that you mentioned, as to whether there are considerations that we ought to observe in the event, for example, that that civil servant may be called before our committee. Are there limits that either he or we must observe in this matter as to his freedom to give information? Can we find out whether there are such limits and what they are?
3566

February 18, 1987
Committee Reports


Mr. Speaker:: The Hon. Member for Spadina (Mr. Heap) has raised a question directed at the Chair perhaps for guidance. At this time the Chair would be very reluctant to make suggestions on what is still a hypothetical situation. The Chair is very consciously aware that this concern comes from all three Parties represented in this House. I think the appropriate course is to take the matter to the committee. It is there that the committee, which is the master of its own procedure, will want to work out how it wishes to deal with the matter.
Committees, of course, are trying to find ways to cover new responsibilities, and this situation seems to be one of those with which the committee itself, at least in the initial stages, will have to deal, on the assumption that Hon. Members take the matter to the committee.
However, I am mindful of the reason the Hon. Member for Spadina has raised this question and the Chair is always ready to discuss difficult matters with Hon. Members at any time, at their invitation to do so.



ROUTINE PROCEEDINGS


Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, as Chairman of the legislative committee on Bill C-3, an Act to amend the Radio Act, I am honoured to present the Bill to the House without amendment.


PETITIONS
Cyril Keeper: Mr. Speaker, I have a petition from some residents in my riding in Winnipeg who indicate that the federal Government's proposals to change the Patent Act relating to prescription drugs will increase drug prices for Canadian consumers and will severely restrict the ability of the average Canadian to buy necessary prescription drugs. They conclude by indicating that Parliament should reject these proposals immediately.


Nelson Andrew Riis: Mr. Speaker, it is my pleasure and honour to present a petition under Standing Order 106 from residents of Langley, B.C., Aldergrove, B.C., Surrey, B.C., Delta, B.C., from the City of Toronto, from Saskatoon, and Albreda, Saskatchewan. The petition simply points out that changes to the Patent Act, which the Government is presently considering, would result in a significant increase in the price of prescription drugs and therefore would
severely restrict the ability of average Canadians to buy necessary prescription drugs. Therefore, they are asking the Government to reject the present proposals regarding changes to the Patent Act so as to enable average Canadians to continue to receive reasonably priced prescription drugs.


Mr. Les Benjamin (Regina West):: Mr. Speaker, I have the honour and duty to present another petition from senior citizens called Senior Power from the City of Regina and from Regina Beach-I bet you did not know we had a Regina Beach, Mr. Speaker-in which they petition this House, believe and have humbly shown that the proposal to amend the Patent Act will increase drug prices and that this will result in higher costs to provincial Government drug plans. Therefore, they petition this House to reject these proposals which they believe will increase prescription drug prices for Canadians.


Leslie Gordon Benjamin: Mr. Speaker, I have a further petition from other great parts of the country including Halifax, Dartmouth, Moncton, Waverley, New Bedford and many other places in the Atlantic provinces. The petitioners say that in their opinion transportation is a natural monopoly without economic regulation and the economic regulatory reform or deregulation proposed in the Government's Bill C-18 will create unnecessary chaos in the transportation industry leading to unacceptable reductions in safety standards as well as a deterioration in the quality, type and frequency of service. Therefore, they request that this House have the Government withdraw Bill C-18 or, alternatively, reject its proposals entirely.


Mr. Sergio Marchi (York West):: Mr. Speaker, I have the pleasure and the honour to present petitions signed by Canadians from coast to coast concerning the new Canada Post corporate plan to create two classes of citizens with the installation of postal superboxes.
Wherefore, Mr. Speaker, your petitioners humbly call upon Parliament to reject the Canada Post plan and establish the same postal service for all Canadians throughout this country.


Fernand Robichaud: 
Fernand Robichaud: If I may, Mr. Speaker, I would urge you to see to it that the tariff on Christmas trees be withdrawn as well, for it might be very harmful to our industry.


Fernand Robichaud: I have a few more petitions, Mr. Speaker, concerning the Canada Post planned closure of a number of post offices in rural regions and elsewhere in Canada. Your petitioners are Ontarians from Tiverton, Fort Elgin, Windsor, and Belle River. They simply ask Parliament to shelve this project aimed at closing rural and urban post offices.


Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, I hope this is the last time I rise in the House on the subject of the duty on books. Mr. Speaker, I have the honour of presenting a few more petitions regarding this question.

The petitioners say 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 and the tariff has little negative effect on the publishing industry of the United States yet penalizes Canada's consumers, book publishers, booksellers, distributors and Canada's culture, and with rising book prices has 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 drop this duty which may cause irreparable harm to the Canadian publishing industry and compromise the survival of the federal policy on cultural industries in the free trade talks with the United States.
I may draw your attention as well to the duty on Christmas trees which should also be dropped.

These petitions come from Waterloo, Kitchener, Toronto, Burlington, Georgetown, Etobicoke, Vancouver, Harrison Hot Springs, Kamloops, Penticton and Kelowna, to name just a few places. With that, I will table these petitions for your serious attention, Mr. Speaker, and particularly for the attention of the Minister of Finance (Mr. Wilson).


Sheila Finestone: Mr. Speaker, I also bring to your attention concerns surrounding Canada Post. I bring the following petition to your attention: whereas the Canada Post Corporation's plan to adopt supermailbox service
Petitions
creates two classes of Canadian citizens in urban as well as rural regions, whereas the closure of rural post offices will eliminate the federal presence in numerous communities and will impede the effectiveness of the postal service which is vital in rural areas, whereas the increased postal rates, particularly on second-class mail, will imperil the distribution of numerous magazines, periodicals and regional newspapers as well as religious publications, the undersigned your petitioners humbly pray and call upon Parliament to reject the corporate plan proposed by Canada Post Corporation and instruct the corporation to proceed with mail delivery to all Canadian taxpayers without discrimination.

They declare that this plan is not fair, Mr. Speaker.

These come from people from Port Hope, Oshawa, Bowman-ville, Hull, Kanata, Manotick, Ottawa and Windsor.


Russell Gregoire MacLellan: Mr. Speaker, I would like to present a petition from residents of Saskatchewan including the cities of Regina and Saskatoon and other communities in that great province, calling upon the Government and Parliament to reject the corporate plan proposed by Canada Post Corporation and instruct the corporation to proceed with mail delivery to all Canadian taxpayers without discrimination.


Alfonso Gagliano: Mr. Speaker, I also have some petitions and these are from the Ottawa-Hull area, including Gloucester, Nepean, Aylmer and Vanier. I also have some petitions from Hull and from the riding of Trois-Rivieres, and all these petitioners respectfully state that the new corporate plan for Canada Post creates two classes of citizens by permanently installing the superboxes in both urban and rural areas; wherefore your petitioners humbly pray and call upon Parliament to reject Canada Post's plan and urge the Corporation to deliver the mail to all Canadian taxpayers, without exception.


Daniel James Macdonnell Heap: Mr. Speaker, it is my honour and duty to present a petition duly approved by the Clerk of Petitions from Canadians living in Vancouver, Nepean, Ottawa, Belmont and other parts of Canada who are concerned that the Government's proposal to change the Patent Act relating to prescription drugs will increase drug prices for Canadian consumers, will restrict the ability of ordinary Canadians with ordinary incomes to buy needed prescription drugs, will increase the cost of provincial government drug plans and will be an unnecessary concession to the United States in the matter of free trade. Therefore, they request that Parliament reject the proposals of the Government on the ground that they will harm the majority of Canadians.

February 18, 1987
Order Paper Questions


Daniel James Macdonnell Heap: Mr. Speaker, I also have a petition from a number of Canadians living in Surrey, White Rock, Delta and Vancouver, British Columbia, as well as Toronto, concerning the low-level flight training conducted at the Goose Bay, Labrador, Canadian Forces Base on behalf of a number of NATO air forces. They are concerned that it disrupts the life of the native people there and damages the environment and is in fact not defensive but a provocative and aggressive war fighting action tending to endanger world peace. Therefore, they request that Parliament ask the Prime Minister (Mr. Mulroney) to ensure that he will end all low-level flight training at Goose Bay and cease negotiating with NATO for the establishment of a larger base there.


Mr. Howard McCurdy (Windsor-Walkerville):: Mr. Speaker, I have the honour to present a petition signed by citizens of Toronto who are concerned, not just for themselves but for all Canadians.
These petitioners humbly pray and call upon Parliament to ensure that the Prime Minister (Mr. Mulroney) end all low-level flight training at the Canadian Forces Base in Goose Bay and cease negotiations with NATO for the establishment of a larger base there.


Mr. Clinch:: Mr. Speaker, I rise on a point of order. I have a little problem with a petition sent to me by 11,500 of my constituents. This petition is addressed to the Government of Canada and not to the Parliament of Canada. The petitioners are asking for a study by the Minister of National Defence (Mr. Beatty) and they make requests concerning the military camp at Tracadie. I seek the unanimous consent of the House to table this petition, Mr. Speaker.


Mr. Deputy Speaker:: Is there unanimous consent?


Some Hon. Members:: Agreed.


J. Roger Clinch: I thank you, Mr. Speaker, as well as all other Members of the House.
I am pleased to table a petition signed by 11,500 citizens of the Tracadie area who are asking the Minister of National Defence (Mr. Beatty) to review all steps towards the expansion of the military camp in Tracadie and seeking increased security for the citizens living in the vicinity of the military camp. They wish to obtain improved and more frequent access to the camp as well as major economic spin-offs for the region.


Don Boudria: Mr. Speaker, I wish to table today in the House petitions signed by 1,980 residents of Glengarry-Prescott-Russell, in addition to the more than 1,400 petitions which I tabled in the House the day before yesterday who also from the people of my riding who strongly oppose the possible closure of rural post offices in my riding.
Mr. Speaker, these petititions are signed by residents of communities such as Applehill, Dalkeith, Hammond, Sars-field, which is my native village, as you probably know, Mr. Speaker, Casselman, Bourget, Saint-Eugene, Hawkesbury, Bainsville, Lancaster, Orleans, Alfred, Plantagenet, Limoges, Vars and others in the Glengarry-Prescott-Russell constituency, as well as by residents of the Stormont-Dundas constituency who have sent me their representations, especially those in Williamstown who are very angry about the plan of the Conservative Government to close rural post offices.


QUESTIONS ON THE ORDER PAPER
Mr. Doug Lewis (Parliamentary Secretary to Deputy Prime Minister and President of the Privy Council):: Mr. Speaker, I ask that all questions be allowed to stand.


Mr. Deputy Speaker:: Is it agreed?


Don Boudria: Mr. Speaker, I shall naturally give my agreement, but I would like to point out once more that one question has been on the Order Paper for two months already, in violation of Standing Order 63, I believe, which states that the Government must reply within 45 days. I am willing to wait a bit longer since I have had the assurance of the Government that I will get an answer in the very near future. I hope that this will indeed be the case.


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


Some Hon. Members:: Agreed.


Philip Derek Lewis: Mr. Speaker, I request that all motions for the production of papers be allowed to stand.


Mr. Deputy Speaker:: Shall all motions for the production of papers be allowed to stand?
February 18, 1987


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Tuesday, February 17, consideration of the motion of Mrs. McDougall that Bill C-35, an Act respecting the reorganization and divestiture of Teleglobe Canada, be now read a second time and referred to a legislative committee, and the amendment of Ms. McDonald (p. 3435).
Mr. Waddell:: Point of order, Mr. Speaker. I wonder if the Chair might help us out. My understanding is that when we left debate on this Bill we had one minute left for the Hon. Member for Winnipeg North Centre (Mr. Keeper) and then we were going into 10-minute speeches?


Mr. Deputy Speaker:: The Hon. Member is correct. We are in the question and comment period following the speech of the Hon. Member for Winnipeg North Centre (Mr. Keeper). The Hon. Member for Windsor-Walkerville (Mr. McCurdy) had a question or comment?


Howard Douglas McCurdy: Mr. Speaker, I have a question for the Hon. Member for Winnipeg North Centre (Mr. Keeper) with respect to his comments the other day. Considering that the overwhelming preoccupation of the Canadian people lies with the tremendously high rate of unemployment in most parts of this country, can he give us his evaluation of this legislation in that context? Action by the Government to produce jobs should be the highest priority, so how does this divestiture signal the Government's efforts to improve the employment picture?


Cyril Keeper: Mr. Speaker, I welcome the opportunity to make a comment. The Government is doing what has been done in the private sector for some time now. It is a game involving taking over companies and it produces no employment. When the Government sells Teleglobe to Memotec it is just another game which will not mean an increase in employment for Canadians.


Mr. Deputy Speaker:: The period for questions and comments is terminated. Debate.


Howard Douglas McCurdy: Mr. Speaker, once again I rise with great concern that in debates such as this there is generally not much of an audience. I hope the Canadian people are watching this debate and learning a lesson about the priorities of their Government, as well as the rather low level of attention given to the major issues affecting
Teleglobe Canada
them which I referred to in the question I put to the Hon. Member for Winnipeg North Centre (Mr. Keeper).
It has always been offensive to me to hit anyone while they are down, but I am afraid the Government needs to be hit while it is down, as it has paid so little attention to the primary concerns of the Canadian people. One would think, given the circumstances of the last few weeks, they would be hastening to try and find some legislative route to gain the support and approval of the Canadian people. If the Government were attentive to the mandate given it by the Canadian people, its emphasis would surely have been on measures which would create jobs. This legislation in no way makes that effort. It offends me that we should be playing ideological games, as we are with this legislation, rather than paying attention, as we ought to, to the concerns of the Canadian people. I know that the Government can look at rather improved employment statistics and find that the unemployment rate is down significantly over-all, but one will find that in seven provinces the unemployment rate is high. Meanwhile, we are here discussing the divestiture of Teleglobe, for what purpose and profit it is difficult to say.
At the moment we are debating a motion for a three-month hoist. The reason the motion for a hoist was introduced is paraphrased quite well in the following headline found in The Financial Post: "The Memotec Teleglobe buy raises serious questions". There are several reasons why it raises serious questions. One of course is that the performance of the stock on the stock market indicated that inside information was available. On the day that it became known that Memotec was to purchase Teleglobe the stock rose from $12.60 to $15.00. I believe that raises serious questions and would suggest a reasonable basis upon which to delay this legislation in order to make the appropriate inquiry to determine whether there was any hanky-panky.
It is interesting to see what the financial community is saying. This article from The Financial Post says that the information that Memotec, which until then was a mysterious company in Montreal, was going to buy Teleglobe is known to have been leaked to the private sector on February 6, "although many greeted it with incredulity". It is also worth noting that another financial expert said "but in terms of Teleglobe's long-term financial viability, it boggles the mind".
Let us examine what has occurred here. Teleglobe is certainly to be regarded as one of the more successful Crown corporations. It had sales of $688 million in 1985 with profits of $53.2 million. It provided approximately $250 million in dividends to its owner, the Canadian Government. It is being purchased by a company which, in the same year, had profits in the order of $17 million and is worth between $40 and $83 million. If ever there was an example of a mouse swallowing an elephant, this surely must be it. This has raised questions of the long-term viability of Teleglobe in these circumstances.

February 18, 1987
Teleglobe Canada
The far more important question is what could have justified this. I have thought long and hard about the Government's commitment to privatization. We understand that the three pillars of Tory Government policy are free trade, deregulation, and privatization. I previously said that if you take these three pillars together they represent Americanization. Of course, it is true that many Americans who have commented on what they expect to achieve through free trade have pointed out, among other things, that they want the Canadian economy to mimic the fundamentals of the American economy. There is considerable objection to the mere existence of Crown corporations. They consider it a condition of reasonable trade and economic relationships with Canada that privatization of Crown corporations be accomplished as soon as possible. I am sure that is of considerable importance to the Government as it so wantonly searches for a free trade arrangement with the Americans.
Beyond that, one must consider that perhaps there are, within the Government's mind, certain purposes to be accomplished by privatization. It may occur to one that the Government might want to sell those Crown corporations which are losing money. As I indicated previously, Teleglobe is certainly not a money-losing Crown corporation so that obviously cannot be the reason for selling it. One may be interested in enhancing the level of competition within the communications industry. However, it is obvious, given the conditions of the sale which provide a protective monopoly situation with certain aspects of regulation, that that is not the intention. Nor is there a likelihood that competition will be enhanced by the sale of Teleglobe.
One can examine this very thoroughly, but one is left with only one conclusion, that is, that it is just empty-headed ideology which commits the Government to such a course of action. This does not create new jobs. Of course, the Government has never said that privatization was for the purpose of creating new jobs. As a matter of fact, there are no assurances that the level of employment presently existing with Teleglobe will be enhanced. We do not even have a commitment to maintain the level of employment which Teleglobe presently provides.
Canada, as well as most of the other industrialized nations, with the exception of the United States, are signatories to an international arrangement with respect to Intelsat. That arrangement was to provide, through cross-subsidization, equivalent rates for the use of international telecommunication means. The new privatized Teleglobe may find itself in a conflict of interest in seeking to find the lowest rates. Will it be inclined to compromise Canada's commitment to an arrangement which will benefit the third world?
It is impossible to find any logical, reasonable basis for the legislation before us. It requires further examination. A three-month hoist will do, but if the legislation were forgotten about altogether it would benefit all of Canada;


Nelson Andrew Riis: Mr. Speaker, we are into the 10 minute question session so one will have to keep one's remarks extremely limited. I must reflect on some of the points made by my hon. colleague, the Member for Windsor-Walkerville (Mr. McCurdy). He asked the general question which I suspect most Canadians are now asking, that is, at a time when unemployment in seven provinces has risen from the level which it was at in 1981-


Mr. Deputy Speaker:: We are now on 10 minute speeches. I am sorry to interrupt the Member, but I thought he was asking a question of the Hon. Member for Windsor-Walkerville.


Nelson Andrew Riis: No.


Mr. Deputy Speaker:: My mistake.


Nelson Andrew Riis: It was probably not your mistake, Mr. Speaker. It was probably the way in which I began my speech. I accept full responsibility for that confusion.
Compared to 1981, unemployment has increased in seven provinces. The situation in most of Canada is not any better after the last two years as a result of the new Government. Rather than consider the privatization of Teleglobe, the Government should address these questions and how to encourage economic development in regions of Canada such as northern Ontario and Quebec in order to get the million or more Canadians back to work in meaningful jobs.
On I travelling throughout my constituency of Kamloops- Shuswap, or when making speeches in various cities and towns in Canada, I have not met one citizen who asked me if there was any possibility that the House of Commons could privatize Teleglobe as quickly as possible because that person lays awake at night worrying about the privatization of this Crown corporation. No one has ever mentioned the need to privatize selected Crown corporations. I regret that we are spending so much time, not only in the House now, but that we will spend days in the committee to debate this question before it comes back to the House for further debate. What will it accomplish other than to satisfy a few back-benchers on the government side who feel, for some burning reason, that this issue should take up valuable time in the House of Commons? I find it extremely frustrating to spend time debating an issue about which no one is concerned, other than a handful of Conservative back-benchers.


Mr. Jepson:: Then sit down.


Nelson Andrew Riis: I hope that is not one of the back-benchers to whom I referred asking why I do not sit down and not say anything. I will not sit down and be muzzled in this debate, because when I see the facts it is clear that the sale of Teleglobe is an absolute give away to a firm called Memotec which is getting one of the best deals ever. Teleglobe is an extremely profitable Crown corporation, with profits in excess of $53 million in 1985. This Crown corporation has become more
February 18, 1987

profitable every year since 1975. It is a well run corporation that is making money for the Government in a critical area of the economy.
Second, let us consider similar corporations in other countries. Teleglobe is a Crown corporation with responsibility for all overseas telecommunications entering and leaving Canada. These telecommunications include telephone, telegraph, cable, and telecommunications. Teleglobe is also a joint owner of a submarine ocean cable and telecommunications satellite system and has an effective monopoly in Canada in overseas telecommunications. It is very critical to our ability to communicate with people around the world in this shrinking global village.
Countries like Australia, New Zealand, France, West Germany, Italy, Norway, Sweden and others have government controlled Crown corporations operating overseas telecommunications system. The United Kingdom has gone through a similar privatization process in which the British Government has conducted a major privatization of British Telecom. Yet it has retained slightly under 50 per cent ownership, with a controlling interest. Even the United Kingdom, under Margaret Thatcher, recognizes that it is necessary to have a controlling interest in this critical Crown corporation that deals with international communication.
Not only is the Government of Canada privatizing Teleglobe, it is giving it away carte blanche at the same time. Not only is it being given away at a fire sale price, there is a myth that it is being privatized so that the Crown corporation may operate in the market-place. Flowever, the fact is that it is a Crown corporation that will be turned over to a private firm that will have a monopoly in which to operate. What kind of private sector free enterprise system is that? Presumably privatization means that a Crown corporation will operate in the independent market-place. However, that is not the case with the transfer of ownership of Teleglobe.
The initial reaction to this sale was one of surprise. The Toronto Star reported on the day of the announcement of this sale: "There were exclamations of surprise and curiosity from the business community yesterday as Memotec Data Inc. of Montreal, the smallest of six bidders vying for Teleglobe Canada, emerged the winner". The Financial Post, which presumably is in touch with the financial and investment community, stated: "the privatization stunned the business community". Presumably this means that the business community was not impressed with this transaction.


Mrs. Mailly:: Not necessarily.


Nelson Andrew Riis: One could go on to cite other exclamations of surprise, curiousness or incredulity about this action by the federal Government.
Teleglobe has been known as the jewel of the Crown corporate family. In 1985 it recorded profits of $53.2 million and its profit picture for the last ten years is set out in millions of dollars. In 1985, Teleglobe's revenues totalled $678 million.
Teleglobe Canada
It is interesting to note that a few months ago British Telecom was interested in this purchase and made a bid of $750 million through the Minister responsible at that time. When one analyses the figures provided to us by the Minister of State for Privatization (Mrs. McDougall), it is clear that the Government will only receive $345 million for Teleglobe when its book value is between $300 million and $450 million. The Government is selling it for significantly less to a minnow in the sea of the corporate sector when it could have sold it for $700 million a few months ago.
Since I only have 10 minutes for debate I will not have an opportunity to talk about the remarkable action on the stock exchange. Obviously some insider information leaked and people began to make small fortunes. In light of the problem with the shares of the corporation that is purchasing Teleglobe, we suggest that this matter be set aside for perhaps three months to provide for an investigation. We could then come back to debate the whole matter again.


Ian Gardiner Waddell: Mr. Speaker, I rise as privatization critic for my Party to take part in the debate on this motion to adjourn consideration of this Bill. Usually such motions ask for a six-month hoist, but in this case we do not want to delay the Bill unduly and have asked for a three-month hoist. I have already spoken on the main motion. I refer Hon. Members to my 40-minute speech on that motion and they can read it when they want to learn something or when they want to fall asleep at night.
I would like to speak briefly on the hoist motion and tell Hon. Members why we have proposed such a motion. I would like to refer to an article by David Hatter which appeared in The Financial Post this week. He is a very serious and good journalist. The headline of the article reads: "Memotec-Teleglobe buy raises serious questions".
We have referred to this company in the House as "Minnow-tec" because this little minnow of a company swallowed this large whale of a Crown jewel, the Crown corporation Teleglobe. That was surprising not only to Hon. Members of the New Democratic Party but to the business community and to those out in the financial world.
Mr. Hatter states in his article:
On February 5-the very day Canada Development Investment Corp. recommended to McDougall-
That is the Minister of State for Privatization.
-that Memotec's bid be accepted-trading in the stock was suspended because of a $2.38 price run-up (to $13).
The price went up from about $10 to $13.
The company then publicly announced its interest in Teleglobe.
Memotec said late last week it believes it has complied with all disclosure requirements.
There is now an investigation by the Toronto Stock Exchange with regard to the unusually heavy trading in

February 18, 1987
The Budget-Hon. Michael Wilson
Memotec shares in the days preceding the Government's announcement.
Mr. Hatter goes on to say:
Sources in Ottawa indicate high-level meetings discussing the Teleglobe sale were held on both Feb. 5 (involving senior officials from departments involved) and on Feb. 6, (with chiefs of staff of the departments).
Memotec is said to have been clearly indicated by participants in the meetings as the leading contender. This information is known to have been leaked into the private sector on Feb. 6, although many greeted it with incredu-


An Hon. Member:: Incredulity.


Ian Gardiner Waddell: Incredulity. I appreciate the help of the Hon. Member. I should be able to say the word because when one Finds one has just lost one's seat, it does incredible things to concentrate the mind. It is like when one is going to be hanged in a few days.


Pauline Jewett: As Dr. Johnson said.


Ian Gardiner Waddell: The Hon. Member is right, as Dr. Johnson
said.
This is not a ridiculous motion or a delaying motion, it is simply a motion so that we can have the report of the Toronto Stock Exchange in hand before we pass this Bill in principle. That seems to me to be reasonable. I am sure Hon. Members opposite would agree with me that it is a reasonable proposition and that is why I think they would agree and vote with the New Democratic Party, and the other opposition Party, I hope, on our motion. We would like to have the report. We are not alleging any hanky-panky but would just like to see why the stock acted in such an unusual way.
This is not NDP ideology or rhetoric. There is an investigation going on by the Toronto Slock Exchange and Mr. Hatter points out, and I think this is the other thing we would like to get cleared up, that there is some discrepancy in the price paid for this corporation. The Government tells us it is receiving $600 million, when the actual price is $328 million. So there is a great discrepancy. For those two reasons, the discrepancy in price, about which we would like information, and the matter of the insider trading, we proposed this motion.


Mr. Deputy Speaker:: Is the House ready for the question?


Some Hon. Members:: Question.


Mr. Deputy Speaker:: The question is on the motion of Ms. McDonald. Ms. McDonald moved:
That the motion be amended by deleting all the words after the word "That" and substituting the following therefor:
"Bill C-38, An Act respecting the reorganization and divestiture of Teleglobe Canada, be not now read a second time but that it be read a second time this day three months hence".
Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


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


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


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


Mr. Deputy Speaker:: Call in the Members.
And the division bells having rung:


The Acting Speaker (Mr. Paproski):: Pursuant to Standing Order 13(4)(a), I have been requested by the Chief Government Whip to defer the division to a later time.
Accordingly, the division on the question now before the House stands deferred until tomorrow at 6 p.m., at which time the bells to call in the members will be sounded for 15 minutes.


THE BUDGET
Hon. Michael Wilson (Minister of Finance) moved:: That this House approves in general the budgetary policy of the Government.
He said:
Canadians have good reason to be encouraged by the nation's economic progress during the past year. Despite some difficult problems, our economy performed well in a challenging world environment.
Today I want to review with this House and with Canadians the substantial progress we have been making on our program of action to renew Canada's economy.
Last year, our rates of economic growth and job creation exceeded those of all the major industrial countries.
We achieved these results in a world economy that has become not only more competitive, but also more uncertain and volatile. The world economy will continue to be challenged:
by serious imbalances in trade positions among industrial countries;
by the persistent, large U.S. budget deficit;

by the external debt problems of developing countries; and
by the rising tide of global protectionism.
February 18, 1987

These challenges underline the need for the Government to work more closely than ever with our trading partners to promote balanced and healthy world growth.

Events outside Canada have affected the nation s economic performance in 1986. Low world grain and oil prices have had a serious impact, particularly in Western Canada. The benefits of steady growth and job creation have been substantial, but they have not been fully shared in all regions.
The Government has responded to regional needs through a number of measures that have cushioned the impact of international events. We have been able to respond because of the progress that the national economy has been making.
Without our success in achieving lower interest rates and lower inflation, the regional problems facing us would have been even more serious.

Let there be no doubt that our future ability to contribute to the economic development of all the regions of this country will continue to depend on our ability as a nation to compete against the best from around the world.


PROGRESS ON OUR AGENDA
[Stage Direction]
Before this Government came to office, the confidence of Canadians had been badly eroded by a severe recession. The severity of the recession and the decline in confidence were symptoms of disturbing trends that posed a threat to our goals of sustained growth, permanent jobs and greater opportunities for Canadians.
The deficit was more than $38 billion and rising.
The national debt had doubled in only three years.
The Government was consuming more and more of the country's resources.
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Private initiative was increasingly stifled by excessive regulation.
Growing industrial subsidies were inhibiting change. Undisciplined spending was leading to waste, excessive bureaucracy and unproductive activity.
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Government was very much part of the problem.
A nation overburdened by deficits and debt is a nation made more vulnerable to economic shocks. But what government does, and how it does it, are as important as how much of the nation's resources it borrows.
That is why, in November 1984, we placed before Canadians a comprehensive economic renewal agenda.
[Stage Direction]
That is why, steadily and consistently, we have acted to make government more efficient; to restore prudent financial
The Budget-Hon. Michael Wilson
management; and to provide an economic environment that encourages private initiative and risk-taking and that rewards success.
[Stage Direction]
Without decisive action to restore the health of the nation's finances, the spiral of deficits and debt would have quickened; confidence would have sagged even further. We had to act. And we did.
We reduced the deficit to $34.4 billion in our first full year in office.
This year we will further reduce the deficit to $32 billion. And we will hold our program spending to $89.4 billion, the target I set out in my Budget one year ago.
I am also announcing today that, in our third year, we will get the deficit down to $29.3 billion.
Let me emphasize the full measure of our efforts. When we came to office, the federal deficit relative to the size of the economy was more than one and a half times the size of the United States deficit, using equivalent measures of comparison. As a share of the economy, our deficit has been brought down to the point where it is now identical to the deficit of the United States.
This progress has not come easily. It has required tough decisions and it has required firm, disciplined management. These actions have been taken as part of our comprehensive program to achieve our central objective of improving Canada's international competitiveness. For it is improved competitiveness that will create sustained growth and permanent jobs.
Our program also includes action:
to deregulate key sectors of the economy; to support science and technology; to assist small business;
to privatize Crown corporations that can perform better in the private sector;
to modernize financial services regulation;
to pursue trade policy initiatives to secure markets for Canada into the next century.
Our trade initiatives are of central importance. They will ensure that our improved competitiveness is translated into more jobs. We remain committed to seeking an agreement with our largest trading partner, the United States an agreement that must clearly benefit Canada. We are also playing a leading role in the new round of multilateral trade negotiations under the General Agreement on Tariffs and Trade. These negotiations will deal with a number of issues of vital importance to Canada, including agricultural trade. As the Prime Minister (Mr. Mulroney) has made clear, the Government will spare no effort in seeking an international resolution to agricultural trade conflicts and an end to the damage they cause in Canada and around the world.
[Stage Direction]
February 18, 1987
The Budget-Hon. Michael Wilson
Another major initiative on our economic agenda is tax reform. I cannot emphasize strongly enough the importance of developing a tax system that is more fair, less complex and that encourages productive economic activity. 1 will return to tax reform later in my remarks.
In this Budget I am presenting our economic prospects and fiscal plan for 1987-88. I will propose a number of management initiatives and revenue measures that will ensure further substantial reductions in the deficit and borrowing requirements. I remain committed to medium-term economic and fiscal planning. The fiscal plan for the coming year is an additional step in our commitment to ensure continuing deficit reductions in the years ahead. Our medium-term economic and fiscal prospects will be significantly affected by tax reform. When my proposal for tax reform is released, I will set out clearly Canada's medium-term economic and fiscal prospects.
This Budget consolidates and extends the fiscal progress we have made. In the Speech from the Throne, the Government established clearly the priorities it would pursue. These priorities have been chosen for action within the limits of our fiscal plan. We have demonstrated our ability to set priorities and to responsibly allocate resources to achieve our goals. The Government will, in due course, be announcing programs to give effect to the priorities and policies identified in the Speech from the Throne.
[Stage Direction]
I want to emphasize that the actions we have taken and will continue to take to pursue our program for economic renewal are not unrelated. They are part of a co-ordinated, cohesive program to strengthen Canada's competitive position.
[Stage Direction]
I am tabling with this Budget a report on the substantial progress that we have made in implementing many of the elements of our Agenda for Economic Renewal. I commend this report to the attention of Honourable Members and all Canadians. It sets out what we have achieved together and the principles that will guide us as we continue to implement that agenda.

[Stage Direction]
Our actions have contributed to strong economic performance over the last two and a half years. This performance is graphic proof that Canadians are responding positively to the
opportunities flowing from our progress in implementing our program of action. Since September 1984:
the real growth of Canada's economy has averaged about 3.5 per cent per year, second only to Japan and much stronger than the United States;
consumer confidence has risen to a very high level and spending by consumers has provided a major impetus to growth;
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the improving Canadian economy has created 675,000 new jobs;
employment growth in Canada has been stronger than in any major industrial country;
the unemployment rate has dropped by two percentage points;
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short-term interest rates are at their lowest levels in nearly a decade;
five-year mortgage rates have fallen by more than three percentage points equivalent to a reduction in interest costs of $1,360 a year on a $50,000 mortgage amortized over 25 years; and that, Mr. Speaker, is more than $113 a month;
with home ownership now more accessible to Canadians, housing starts are at an eight-year high and without the artificial boost of government subsidies.
For 1986 I estimate that our economy grew by 3.3 per cent, a growth rate which outpaced all other major industrial countries. This performance was achieved despite the severe domestic impacts of lower world grain and oil prices.
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If I had to choose just one message for Canadians today, it would be this: Our economic renewal program is working. It is delivering more growth, more jobs and more opportunities now. It is building new confidence at home. By changing our image abroad, it is helping to attract the investment that Canada needs.
[Stage Direction]
The benefits of our strong economic performance have not been evenly shared across the country. Some regions are hurting. We have helped provide support over the past year and we are working with provincial Governments and industry to find ways of developing a sound base for improved, sustained growth in all regions.
Better economic performance is the key to providing more help for disadvantaged Canadians wherever they live. As a result of this better performance, the Government has been able to direct more resources in a variety of ways to individuals most in need of assistance. We have improved social benefits. We will continue to work to increase assistance to those in need.
We intend to ensure that our program of economic renewal works for all Canadians. It is the key to future prosperity.
February 18, 1987

[Stage Direction]
This year will mark the fifth consecutive year of expansion. This economic upturn is the second longest of the postwar period. Prospects are excellent that it will continue.
Consumer confidence is strong. Interest rates are expected to remain relatively stable this year. Housing starts will continue at high levels and business investment will recover and grow modestly this year. Inflation will average less than 4 per cent in 1987 and decline through the year, leaving Canadians with more spending power. I am projecting real output growth of 2.8 per cent in 1987.
Our rate of job creation this year is expected once again to exceed that of any other major industrial country. Strong employment growth will be accompanied by large numbers of new entrants to the labour force, a sign that many once again are seeking work as a result of greater confidence about our economic prospects. I expect unemployment to decline through the year and the unemployment rate to fall to 9 per cent by year-end.
[Stage Direction]
Our stronger competitive position leaves Canada well placed to benefit from expected improvements in international economic activity. Recent interest rate declines, exchange rate realignments and some firming of commodity prices will help increase Canadian sales in foreign markets.

[Stage Direction]
Continued progress in improving our economic outlook, next year and beyond, depends on keeping to a fiscally responsible course.
We want our children and grandchildren to enjoy the opportunities they deserve by right. We must not burden them with a legacy of intolerable debt that robs their future of opportunity.
We want to improve our social programs and provide more help for those in need. We must restrain government debt that diverts tax dollars from human needs to interest payments.
We want Canada to retain the fullest flexibility to set its own course in a world of international change and competition. We must not allow ourselves to be constrained by a strait-jacket of debt.
Dealing positively with deficits and the debt is, ultimately, about improving the well-being of Canadians. That is why we have made it clear from the beginning of our mandate that we are committed to fiscal responsibility.

[Stage Direction]
Last September, I set out clearly the four fundamental principles that have guided our fiscal policy. We committed ourselves to these principles in 1984 and reaffirmed our
The Budget-Hon. Michael Wilson
commitment last September. We are acting to fulfill these commitments.
Our first principle is to reduce the growth of the national debt to less than that of the economy by the end of this decade.
When we took office, the public debt had been growing in the previous four years at an average annual rate of more than 23 per cent. The growth rate will be cut to 11 per cent in 198788 still too high, but a substantial improvement in a short time.
Our second principle is to achieve continuing, sizeable year-over-year reductions in the deficit.
When we took office, the deficit was more than $38 billion. We will meet the 1986-87 deficit target of $32 billion that I set out on September 18. By the end of 1987-88, in just three years, we will have reduced the deficit by almost 24 per cent.
Our third principle is to ensure substantial year-over-year reductions in the government's financial requirements.
When we took office, financial requirements, excluding foreign exchange requirements, were $29.8 billion. In the current fiscal year, financial requirements will fall by $5.8 billion to $24 billion. This will be cut further to $21.3 billion in 1987-88 a drop of 28.5 per cent in three years.
Our fourth principle is to ensure that the greater part of the progress is through expenditure restraint and disciplined management.
When we took office, government spending on all programs was growing by almost 14 per cent a year and had done so since the start of the decade. Since then, program spending has grown on average by only 2.8 per cent a year, well below the rate of inflation. Spending on government programs is being reduced in real terms and relative to the economy. About 63 per cent of the decline in the deficit relative to the size of the economy will have been achieved by reductions in spending.
The progress we have made in applying these principles is substantial. We are determined to continue until the job is done.

[Stage Direction]
Last September, in recognition of the difficulties facing hard-hit regions and sectors of the economy, I set out a revised deficit target of $32 billion for 1986-87.
This decision to accept a slower decline in the deficit was taken consciously and positively to cushion the blow that lower world oil and grain prices have dealt to some parts of Canada. Even with this decision, the revised deficit target still represents a sizeable decline from the previous year, and is consistent with our fiscal principles.
But I also said in September that we would hold our program spending to the target of $89.4 billion that I set out last February. We will do so. We have responded to unforeseen developments in a fiscally responsible way. Where necessary, we have reallocated resources, reassessed priorities, made midcourse adjustments and acted to achieve our targets.
February 18, 1987
[Stage Direction]
The Budget-Hon. Michael Wilson
[Stage Direction]
We will continue to set realistic and responsible expenditure targets and manage so that we can meet them.
[Stage Direction]
Our fiscal situation in 1987-88 will continue to be affected by low prices for oil and grain. For example, additional support to grain farmers through ongoing federal programs will be $1.5 billion higher than I anticipated in my February 1986 budget. Similarly, corporate income tax revenues will be substantially lower than forecast a year ago.
Government actions to provide additional assistance to farmers and to the oil and gas industry will also affect expenditures and revenues in 1987-88. In October of last year we eliminated the Petroleum and Gas Revenue Tax, thereby providing additional cash flow to the petroleum industry. We enhanced the fuel tax rebate for all farmers, effectively removing the tax on their farm fuel. And to further ease the current financial problems of Canadian grain farmers, we are providing a $1 million Special Canadian Grains Program.
Some Hon. Members:: Billion.


Michael Holcombe Wilson: One billion dollars. John Wise almost got me there!
In these changed economic circumstances, the prospective deficit for 1987-88 would have been higher than appropriate to maintain an acceptable rate of progress toward our medium-term goals. I am therefore proposing a combination of management initiatives and revenue increases to keep us on course. These measures will enable us to get the deficit down to $29.3 billion in 1987-88.
[ Translation]


MANAGEMENT INITIATIVES
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Better management of government operations and public resources has played an important part in our renewal program. We have cut back overhead costs and operating and maintenance expenditures. We have increased cost recovery and asset sales. All of these initiatives will have ongoing fiscal impacts.

[Stage Direction]
We are actively pursuing areas where further cash management improvements can be made. One of these is the regularity with which employers remit to the government deductions they make for their employees on account of personal income taxes, and contributions to the Unemployment Insurance Fund and the Canada Pension Plan. These deductions are now remitted monthly.
For larger employers, I am proposing to move to twice-monthly remittances, effective January 1, 1988. This will not increase taxes paid by individuals.
Smaller businesses, those with average monthly remittances of less than $15,000, will be excluded from this requirement.

[Stage Direction]
Over the last three years, we have allocated substantial resources to defence even while we have had to control overall expenditures. To help meet our fiscal objectives in the coming year, the Government will defer $200 million from 1987-88 defence spending levels and restore this amount in 1988-89. The Minister of National Defence (Mr. Beatty) has confirmed that this action will not affect the rebuilding of our defence capability that is now under way. Annual defence spending in 1987-88 will be $1.4 billion higher than when we took office. As a share of program expenditures, defence spending will have risen from 10.1 per cent in 1984-85 to 10.8 per cent in 1987-88.
This year the Government will release a White Paper which will provide Canadians with our view of the appropriate direction for defence policy to the end of the century. This White Paper will deal with program priorities and resource implications.

[Stage Direction]
Since taking office, this government has given strong support to developing countries. Canada's foreign aid expenditures next year will be $450 million higher than in 1984-85, an increase of 21.8 per cent. We have also been acting to improve the quality of our aid and to manage these growing expenditures more effectively. For example, we are now providing all financial assistance in the form of grants rather than loans. We have taken measures in other areas too, such as in providing duty-free access to our market for a range of goods from Commonwealth Caribbean countries.
The Government is committed to achieving the objective of 0.5 per cent of GNP for official development assistance. We expect that through adjustments in cash management and in our international reporting practices we will be able to meet this commitment while contributing to fiscal restraint. This will result in cash savings of $150 million in 1987-88.

[Stage Direction]
The air transportation tax recovers part of the cost of providing air transport facilities and services. In order to recover a greater proportion of these costs from those who benefit from the services, and to help provide enhanced levels of security at airports, I am proposing to increase this tax. Accordingly, on the recommendation of my colleague, the Minister of Transport (Mr. Crosbie), I am announcing that the air transportation tax will be increased by $4 per ticket effective May 1, 1987 for tickets purchased in Canada and August 1 for tickets purchased abroad. The existing $50 ceiling on the tax will continue to apply.

[Stage Direction]
I am announcing today a limited number of tax increases.
The excise tax on motor gasoline and diesel fuel will be increased by one cent per litre effective tonight. The rebate to
February 18, 1987
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farm producers will be increased accordingly, so that farmers will continue to be relieved of effectively all tax on their fuels for farm use.
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I am also acting to equalize the federal sales and excise tax burden on leaded and unleaded gasoline. This action will support the efforts of my colleague, the Minister of the Environment (Mr. McMillan), who has announced a program in co-operation with the petroleum and automobile industries to eliminate lead emissions from gasoline by the end of 1992.
[Stage Direction]
Effective tonight 1 am increasing the excise tax on cigarettes and other tobacco products by 4 per cent.
As of July 1, 1987, I am extending the federal sales tax to a limited range of snack foods that compete with similar products that are currently taxed.
The rules introduced in 1982 with respect to the taxation of accrued interest on investments are very complex. I am continuing to examine ways to simplify these rules. As an interim step I am proposing to expand eligibility for prescribed annuities to include persons of all ages. I am also proposing, for the 1987 taxation year, to provide relief for holders of pre-1982 compound interest bonds, including over one million holders of Canada Savings Bonds.
To complement the major reforms that my colleague, the Minister of State for Finance (Mr. Hockin), has announced, I intend to propose amendments to the Income Tax Act to allow investment dealers to offer self-administered RRSPs directly to their clients. I will be consulting with the securities industry before proposing these amendments.
I am also announcing that the Indian Remission Order will be extended for 1987. My colleague, the Minister of Indian Affairs and Northern Development (Mr. McKnight), and I are developing proposals to rationalize the treatment of employment income of Indians on reserves, in order to eliminate the need for the Remission Order. We will consult further with Indian representatives and other interested parties when the proposals are made public.

[Stage Direction]
The government has been working to make Canada a more effective world trader. In today's rigorously competitive world, we will not always see eye to eye with our trading partners. We must act to resolve our differences in a manner that is fair but that docs not compromise Canada's interests.
The government acted last June when the United States moved to impose a 35-per-cent tariff on Canadian exports of red cedar shakes and shingles. We needed to send a strong expression of concern to the United States about their protectionist action. We had to guard against a loss of Canadian jobs.
Our response was two-fold: We took measures to increase tariff rates on a number of goods imported principally from
The Budget-Hon. Michael Wilson
the U.S. We also tightened controls on the export to the United States of cedar logs and bolts.
As a result, the U.S. tariff has not enhanced the competitiveness of the American shakes and shingles industry. Its main impact has been to increase costs to American consumers.
The export controls have protected the competitive position of the Canadian industry, which has been able to return to almost normal production levels. Having achieved our purpose, we can maintain the strength of our response by confining it to the restrictions on the export of cedar logs and bolts.
Accordingly, I am announcing that for all products affected by the tariff measures the rates of duty are being reduced, effective tomorrow, to those rates in effect immediately prior to June 6, 1986. This will reinstate duty-free entry for books, computer parts and Christmas trees.
The export restrictions on cedar logs and bolts which have proved essential in safeguarding the Canadian shakes and shingles industry in the face of the American tariff will remain in place as long as necessary.
Canada's steel industry faces serious competitive problems due to the world-wide excess in steel-making capacity. To help our industry deal with these circumstances, the Government has decided, effective tomorrow, to withdraw the General Preferential Tariff on imports of most specialty and carbon steel mill products.
I am also proposing a number of miscellaneous tariff changes, primarily in response to requests from Canadian industry for changes in tariff rates and to fulfill obligations undertaken in the Tokyo Round of GATT negotiations. One of these measures is the elimination of the tariff on mobile veterinary clinics, a move which many Members of this House have advocated.

[Stage Direction]
I am concerned that abusive tax-avoidance transactions are a significant factor in eroding corporate tax revenues. They also undermine respect for the integrity of our tax system. Such schemes permit some corporations often large and profitable to avoid paying income tax.
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The Government has acted repeatedly to curb these and other such abuses with a series of specific rules. Where required, the Government will continue this practice. In addition, to ensure a fairer and more stable income tax system, I intend to propose improved general anti-avoidance rules as part of tax reform.
Recent court decisions have called into question the fair price provisions of the Excise Tax Act. These judgments have raised the possibility of substantial erosion of the sales tax base. In the light of the jurisprudence, I am examining ways to rectify the law to prevent this erosion.
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February 18, 1987
The Budget-Hon. Michael Wilson
To further address this concern, I am moving the point at whicli sales tax is applied on a number of specific commodities from the manufacturer's level to the wholesale level. The goods affected include microwave ovens, televisions, video recorders, snack foods, candy and confectionery, and pet foods. These changes will ensure a fairer application of the sales tax to both domestic and foreign products and thus reduce the bias favouring imports under the current system.
These actions are in line with our commitment to bring greater equity to the federal tax system.

[Stage Direction]
Comprehensive tax reform presents one of the most promising opportunities we have to strengthen our economy and improve the quality of our society.
A fairer and more effective tax system will complement and reinforce economic opportunities for individual Canadians. Tax reform will inaugurate a new era of tax fairness, permitting us to rely less on personal income taxes and provide improved benefits for low-income Canadians. It will play a crucial role in stimulating investment, encouraging dynamic business activity, job creation and economic growth. It will give Canadians greater assurance that revenue goals will be met, and met fairly.
Last October I set out the Government's guidelines for reforming the tax system. I am developing an integrated proposal for tax reform in all three areas of our tax system personal, corporate and federal sales tax. I have benefited greatly from the views I have received from individuals and corporations, from labour unions and business associations, from women's groups, from the voluntary sector, from provincial governments and Members of Parliament.
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The central objective of tax reform is to reduce tax rates. There can be no better incentive for growth, investment, savings and job creation. Lower income tax rates will allow all Canadians to keep more of each additional dollar they earn to spend, save or invest as they choose.
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To get tax rates down, we must reduce tax preferences and broaden the tax base. A wide range of specific tax preferences, of primary benefit to corporations and upper-income earners, would be eliminated, reduced or modified right across the system.
What tax reform would mean for taxpayers is that those who have been making extensive use of tax preferences will pay more tax. Those who have been making little use of preferences will pay less tax. The large majority of individual taxpayers will pay less tax in total.

[Stage Direction]
I aim to achieve substantially lower personal income tax rates and significantly fewer tax brackets.
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I am also considering the conversion of personal exemptions and some deductions to tax credits. Exemptions favour those in higher income brackets. A tax credit, on the other hand, provides the same dollar benefit to taxpayers regardless of their income level. With a system of tax credits, lower-income taxpayers would receive greater benefit than they do now, while those at higher income levels would receive less.
In my last Budget, I announced the Government's intention to propose further measures to reform our system of social transfers and related tax provisions. Converting exemptions into appropriate credits would represent a major step toward fulfilling this commitment. It would also reduce the number of low-income individuals who now pay personal income tax.
I am also examining ways in which I can build on the existing refundable sales tax credit that I introduced in my last Budget. By increasing the credit and paying it more frequently we can make our personal tax system more progressive.

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Our fundamental strategy in reviewing the corporate income tax is to ensure that profitable corporations pay their fair share.
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I have been seriously concerned about tax loss trading. It has made our corporate tax revenues uncertain. It has led to profitable corporations not paying tax. To preserve respect for the tax system, we must further reduce the source of the problem by cutting back special corporate tax write-offs. This is the direction I set out in May 1985 and acted on last February.
Cutting back corporate preferences would balance the reduction of corporate tax rates to levels competitive with those in other countries, while providing increased and more stable corporate tax revenues.

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The federal sales tax is unfair and inefficient. It is a silent killer of jobs. It levies a higher tax on average, one-third higher on domestic manufacturers than on competing imports. This leads to plant closures and lost Canadian jobs. The base is narrow and similar goods can have very different burdens of tax. The sales tax is coming under increasing pressure and reform is increasingly urgent.
We will aim to broaden the base and lower the rates, and ensure equal treatment of imports and domestic goods. Building on the existing sales tax credit would improve the fairness of our system.
February 18, 1987
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Over all, the major thrust of tax reform will be to simplify the tax system, to limit special preferences and provide incentives through lower tax rates. To achieve these goals, we must deal with the three elements of our tax system together, as an integrated package.
[Stage Direction]
Our proposal for tax reform will make our tax system more fair, less complex and more understandable. It will reflect our commitment to economic progress and social justice.
[Stage Direction]
I am tabling the document I referred to earlier, as well as supplementary information, and Notices of Ways and Means Motions covering tax and tariff measures. I will also, pursuant to a motion of this House, introduce today a borrowing authority Bill. In light of the increase in Canada's foreign exchange reserves, I will be seeking supplementary authority for this fiscal year. I will also be seeking borrowing authority for 1987-88.
I hope that this bill will be dealt with expeditiously. CONCLUSION
This Government has acted on initiatives of fundamental importance to the Canadian economy. This reflects the scope of the challenge that we inherited, and our determination to meet that challenge. We will continue moving forward with our program for economic renewal in a carefully managed, consistent way.
From the standpoint of new initiatives, this Budget represents a breathing space prior to the presentation of major proposals for tax reform. But I have also made clear in this Budget that while great progress has been made on the nation's deficit problems, there can be no holiday from fiscal responsibility.
The challenge is to maintain sound, steady management of both the fiscal and economic situation. We are meeting that challenge. We will continue to do so.
[Stage Direction]
1 have talked with and heard from thousands of Canadians these past two and a half years. I can say with confidence that Canadians from coast to coast will not be daunted by the challenges ahead.
[Stage Direction]
Economic renewal is not just a test of government. It is a test of all of us and our ability to share in the effort to build a stronger economy. And the most important test of our success is the economy's progress, the progress of all Canadians who, individually and collectively, make the economy what it is.
Our progress is measured in growth, jobs and new opportunities and in a stronger economy better able to meet the
The Budget-Mr. Garneau
challenge of rapid economic change and increasing international competition.
The results tell the story. We are on the right track. Our program of economic renewal is working. And we have only begun to see the results that we as a nation can achieve if we stay the course. We must continue to build a stronger, more dynamic and more flexible economy that works for the benefit of all Canadians.
Some Hon. Members:: Hear, hear!


Mr. Speaker:: Order! Pursuant to the order agreed to on Friday, February 6, 1987, the House will now revert to introduction of Bills.



ROUTINE PROCEEDINGS


Michael Holcombe Wilson: for leave to introduce Bill C-40, an Act to provide borrowing authority.


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


Some Hon. Members:: Agreed.


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


Some Hon. Members:: Agreed.


THE BUDGET
[Stage Direction]
The House resumed consideration of the motion of Mr. Wilson (Etobicoke Centre) that this House approves in general the budgetary policy of the Government.
Mr. Raymond Garneau (Laval-des-Rapides):: Mr. Speaker, in concluding his Budget Speech, the Minister of Finance (Mr. Wilson) observed with great satisfaction that his Government was, as he said, on the right track. I want to ask the Minister of Finance (Mr. Wilson) how he could possibly reach that conclusion in his speech today, when in seven or eight out of ten provinces in this country, the unemployment rate is higher

February 18, 1987
The Budget-Mr. Garneau
now, after nearly three years of Conservative Government, than it was during the 1982 economic recession.
Mr. Speaker, the statement the Minister of Finance just made, and I say statement because I can hardly call this a Budget, is a statement without vision. It is a statement that totally ignores the realities of this country.
[English)
This is a Budget without vision. This is a Budget which does not address any of the real problems which Canadians have to face. Fifteen days ago when the Minister of Finance announced that with this Budget there would be no tax reform, I said that the Budget would be a go-nowhere-and-do-nothing Budget.


An Hon. Member:: Right on.


Raymond Garneau: I do not think, as my colleague has just said, that I was right on. I made a mistake. It is worse than I thought it was going to be. Not only did the Minister increase taxes for the third year in a row, but he did not announce any program, any budgetary measure, to try to solve the problem which exists between the rich and the poor of this country. He did not try to solve the problem of the regions of this country where the rate of unemployment is higher today than it was during the height of the world recession which we suffered in 1982.
This is not a Budget. It is a disgrace to call this paper a Budget. I would like to ask the Minister why he put us through this charade. He could have issued, as he has done on many occasions, a press release to announce an increase in taxes for people who buy gasoline, another cent a litre increase, after the three cent increase he announced in his last Budget. This could have been announced through a press release, and a Ways and Means Motion could have been tabled in the House.
I think it is a real disgrace that the Government did not use the opportunity to table a real Budget, a Budget with a vision, one which will take into consideration the problems which Canadians face, particularly in our regions. I think the Minister missed a very good opportunity. This exercise is not worth the time we have spent this afternoon. I think the Minister should have stayed home and issued a press release.
We have these documents with the Budget, and I see no projection of revenue, no projection of the rate of interest, and no projection of employment. We have only the figures for the fiscal year 1987-88. I am sure all Hon. Members, particularly those who have been Members of Parliament for a number of years, have heard the Tories asking the former Government to table a five-year plan. I recall the former Minister of Finance, the present Minister of Transport (Mr. Crosbie), when he was in the Opposition, asking the Government to table a five-year plan. This is what the Fiberal Government decided to do. This Minister of Finance did not bother to give this information. We do not even know what he thinks the price of oil will be in 1988. He only gave us the price of oil for 1987.
What we have is not a Budget. I was expecting that at least the Minister would keep the promises he made last year. Fast year the Minister made three promises: first, that we would have tax reform this year; second, that we would have a reform in our social programs; and, third, that he would bring the deficit under $30 billion. The Minister today is telling us that the deficit will be $32 billion for 1986-87. If the Minister had not sold Teleglobe, the deficit would have been higher this year than it was for the last complete year of the Fiberal administration, even after four years of economic recovery, and after a tax increase of $6 billion last year. And there will be more increases this year. The deficit of the Tory Government for the year 1986-87 would have been higher than the deficit of 198_. 84, which was the last complete year of the Liberal administration. That is a real shame. The Minister is not delivering on his target of reducing the deficit.

The Minister of Finance has failed to live up to his commitment because the deficit would be higher, almost at the same level this year as it was for the last full year of the Liberal administration. There is no program, no improvement in social programs as he had promised last year.
And the tax reform, Mr. Speaker, now I really thought the Minister of Finance was a serious and responsible man. But he is juggling with facts. He is deceiving himself and, worse still, he is trying to make Canadians believe that this Government is serious.
What is the Government strategy, Mr. Speaker? Very simple. Taxes increased by several billion dollars in 1985 and again in 1986. Automatic tax increases have been incorporated in the tax laws so that this year Canadian taxpayers have paid, will pay during the next fiscal year when the Budget stands at $43 billion, 48 per cent more, in personal income taxes than the last year under a Liberal administration. Yes 48 per cent.
Taxes went up by $6 billion last year, 90 per cent paid by individuals, less than 10 per cent by corporations. The Minister of Finance is talking about tax reform. What is he going to do? First he raised taxes, then he will tell us that the reform will correct his own mistakes. I think the whole thing is a joke.
Mr. Speaker, there is nothing in this Budget for the farmers or for western wheat producers. There is nothing for the fishermen who are now faced with the consequences of the agreement that was signed with France. Nothing has been done to deal with our energy problems. Just imagine, Mr. Speaker: The price of gas will have gone up 4 cents a litre since this Government came to power, and we don't even have a national energy policy. These are the same people who criticized the previous administration for increasing the price of gas to help create a fund that would help the energy industry. They kept the tax and increased it four times, but they have nothing for the energy industry.
Mr. Speaker, there is nothing either to implement the formal commitment made by the Prime Minister (Mr. February 18, 1987

Mulroney) in Vancouver. I was there as representative of my political Party. His was a very firm commitment to set up a day care system and provide the necessary funding. Nothing about that in the Budget.
Mr. Speaker, I think-
There is nothing for day care. There is nothing for fishermen. There is nothing for farmers. The tourist industry will be badly hurt by another increase in the price of gasoline. The tax of $4 more on an air ticket is a real Crosbie tax.
I think that the Government and the Minister of Finance should be ashamed. I will have much more to say, but for the time being I move:
The Budget-Mr. Garneau

That the debate be now adjourned.


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


Some Hon. Members:: Agreed.
On motion of Mr. Garneau, debated adjourned.


Mr. Speaker:: Pursuant to order made Friday, January 30, 1987, this House stands adjourned until tomorrow at 11 a.m., pursuant to Standing Order 3(1).


[Stage Direction]
The House adjourned at 5.33 p.m.
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Thursday, February 19, 1987
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Prayers