1987-08-26

Mrs. Therese Kiliens (Saint-Michel-Ahuntsic):: Mr. Speaker, 4,630 Canadian men and women lost their lives in 1985, and 258,000 of our fellow citizens were injured in highway accidents-262,630 road victims altogether. In the same year, 46,333 people died from malignant tumours and 58,331 from heart diseases. The road made more victims than these two illnesses combined.
Considering the money we spend on medical research to save lives, it seems to me that North American car manufacturers could easily install safety belts, an initiative which does not require research since the technology already exists.
Since 1969 European cars makers have been installing shoulder safety belts for rear-seat passengers.
I would urge all Canadian men and women to sign the petition I am circulating so that North American manufacturers will understand that time has come to provide all passengers-front-and rear-seat occupants alike-with the same protection in case of road accidents. The money saved in hospital care could be earmarked for research in and development of cures for heart conditions, cancer and other diseases.


REGIONAL ECONOMIC DEVELOPMENT
Mr. Guy St. Julien (Abitibi):: Mr. Speaker, August 21, 1987, was a memorable day for the people of Abitibi. About 1,500 people from various towns and villages in the area, as well as from New Quebec, applauded the Prime Minister of Canada (Mr. Mulroney) and his wife Mila, the Ministers from Quebec and Conservative Members at Saint-Sauveur Church
Community Hall in Val-d'Or, where everyone was invited to a corn roast.
The Prime Minister praised the Abitibi-Temiscamingue region's record for the lowest unemployment rate in Quebec: 6.9 per cent compared with 18.6 per cent in 1984.
The Prime Minister and Mrs. Mulroney signed the City of Val-d'Or's guest book at the request of the Mayor, Mr. Andre Pelletier, in the presence of the aldermen. On the same occasion, the President of the CRDAT provided information on the most pressing problems affecting Abitibi-Temiscamingue.
Mr. Speaker, our region has deserved the attention it has received from a Conservative Government and it will continue to receive that attention with Brian Mulroney as Prime Minister of Canada.
This is a Government that listens to the people.


FISHERIES
Mr. Jim Manly (Cowichan-Malahat-The Islands):: Mr. Speaker, the Minister of Fisheries and Oceans (Mr. Siddon) has praised the troll fleet in the Gulf of Georgia because it can be selective in the species of salmon that it harvests. He has said that it should be maintained. But his actions speak louder than his words.
This year's allocation of salmon was set below the minimum needed for many trollers to survive. Now, to add insult to injury, trollers are being shut down before they have been able to catch even this quota. In the meantime, other gear types are being allowed to fish for a good sockeye run. Trollers see this as rank discrimination that has nothing whatever to do with conservation.
In the interests of maintaining this small but vital section of our Pacific fishery I call upon the Minister to take a second look at the situation and to ensure sufficient allocation of fish and sufficient days' fishing so that the Gulf trollers can survive.

August 26, 1987
5. O. 21 TRADE


CANADA-UNITED STATES NEGOTIATIONS-ECONOMIC COUNCIL'S PROJECTION OF BENEFITS
Mr. Alan Redway (York East):: Mr. Speaker, hardly a day goes by that a senior citizen on a fixed income does not complain to me about the high cost of living. Understandably, they do not believe the inflation statistics when they see prices increasing each week at the supermarket. Because of that seniors in my riding, and seniors all across the country, should take a careful look at the new study by the Economic Council of Canada which states that consumers would be the first to win from free trade with the United States. Lower import prices would give them more to spend.
The Economic Council of Canada has good news for Canadian workers as well. According to its report, free trade with the United States would create at least 189,000 new jobs, and possibly as many as 350,000. The manufacturing sector alone would gain 42,000 jobs.
The study goes on to state that free trade would stimulate our economy fairly and evenly across the country but, because of their size, Quebec and Ontario would net about 60 per cent of the economic benefits.
Let us hope that the CBC will inform Canadian seniors and workers about this new study instead of ignoring it as it has done up until now.
*
* *


PHARMACEUTICAL INDUSTRY
Mr. George Henderson (Egmont):: Mr. Speaker, the Government of the Prime Minister (Mr. Mulroney) has knuckled under pressure from the American drug lobby. Bill C-22 is another pawn, another attempt to get a free trade ride with a lame duck President. Senior citizens, the sick and the disabled will bear the brunt of this give-away.
On March 10, 1987, the P.E.I. Legislature unanimously passed the following resolution:
WHEREAS the Government of Canada has introduced amendments to the Patent Act which will inexorably over time result in an increase in the price of prescription drugs;
AND WHEREAS the Province of Prince Edward Island has recently introduced a Drug Cost Assistance Plan which strives to reduce the cost-burden of drugs for senior citizens;
AND WHEREAS increased prescription costs will adversely affect this Plan and indeed all other citizens of our Province who require drugs from time to time;
THEREFORE BE IT RESOLVED that this Assembly urge the Prime Minister in the strongest possible terms not to proceed with this Bill.


ADVANTAGES OF FREE TRADE
Mr. Gabriel Fontaine (Levis):: Mr. Speaker, the reputable Economic Council of Canada gave its official assessment yesterday of the bilateral trade talks with the United States. Signing the agreement would mean 189,000 new jobs. In addition, the ECC expects Canadians will become more efficient and more competitive, with, as a result, 350,000 new jobs. Of the 36 industrial groups recognized by Statistics Canada, 30 will benefit significantly from free trade. These benefits will also be felt at the consumer level. The ECC expects prices to drop by 5 per cent to 6 per cent.
When an organization like the Economic Council of Canada, a strictly autonomous organization with an excellent staff, speaks out in favour of our trade talks with the United States, adding its voice to that of business, and specifies the considerable benefit to the consumer, it is becoming embarrassing for articulate politicians to be against free trade.
Mr. Speaker, in the days to come we shall see whether the Liberals and the Socialists are indeed articulate politicians.
* *
*


THE MINISTRY
Ms. Audrey McLaughlin (Yukon):: Mr. Speaker, last year a Conservative cabinet Minister resigned amid allegations that a $5,000 fee had been charged for a reception where Quebecers could get a chance to meet with members of the Mulroney Cabinet. Today it was reported that Bill Jarvis, President of the Progressive Conservative Party, had charged a fee of $1,200 to arrange a meeting between the Inuit Broadcasting Corporation and the Secretary of State of Canada (Mr. Crombie).
Canadians are now asking why some people have to pay to get the ear of the Government when only yesterday the Prime Minister (Mr. Mulroney) himself-


Some Hon. Members:: Oh, oh!


Mr. Speaker:: We have had some difficulty before with statements by Members which amount to what could be taken as allegations of wrongdoing by any Member of this House. 1 have had to indicate that it is not appropriate to make those allegations in statements by Members.
I regret very much interrupting the Hon. Member. 1 do not know what more the Hon. Member might have had to say, but I just wonder if, under the circumstances, she would co-operate
August 26, 1987

and perhaps consult with some of her colleagues, keeping in mind what I have said. Perhaps some of the substance of what she wants to bring to the Chamber could be brought at another time.


CANADIAN BROADCASTING CORPORATION
Mr. Stan Graham (Kootenay East-Revelstoke):: Mr. Speaker, the mandate of the publicly funded CBC is to bring to Canadians accurate, fair and unbiased reporting of national affairs. I have observed many occasions on which the CBC has conveniently and with ulterior motives either ignored or exaggerated issues in a conscious effort to promote its socialist beliefs.
Never has there been a more blatant abuse of the CBC's mandate than that which was demonstrated yesterday by the CBC's deliberate choice to ignore the more than 2,000 Canadians demonstrating in support of Bill C-22.
CBC TV made a deliberate decision to remain silent and prevent Canadians from being properly informed of a major national event. This irresponsible, biased approach to reporting is totally unacceptable.
This lack of accountability falls squarely on the shoulders of the President of the CBC, Mr. Pierre Juneau, and for this reason I demand his immediate resignation.


TAX REFORM
Mr. Jean-CIaude Malepart (Montreal-Sainte-Marie):: Mr. Speaker, a poll conducted on behalf of the Department of Finance shows that 71 per cent of Canadians are against the proposal of the Conservative Government to tax bread, milk and butter.
We are campaigning to make people aware of this issue, and to date 25,000 people have signed a petition urging the Conservative Government to drop this project.
Last weekend the pathetic Quebec Conservative caucus asked the Prime Minister (Mr. Mulroney) to reconsider this stupid idea. Since the Prime Minister has refused to withdraw this measure and wants to go ahead with his suggestion aimed at taxing bread, milk and butter, I would simply tell all Canadians that the Liberal Party is pursuing its awareness
campaign and urging them to sign petitions to force the Government to reconsider such an idiotic decision.


PHARMACEUTICAL INDUSTRY
Mr. Bob Horner (Mississauga North):: Mr. Speaker, the passage of Bill C-22 has been blocked for the time being by the Senate. The Senate says that if this Bill is passed, drug prices will rise. The Senate says that innovative drug companies cannot be trusted to bring forward the money for jobs and for the research and development which they have promised. The Senate says that a generic drug industry cannot survive side by side with an innovative industry under this Bill. These are false and misleading statements. The Toronto Star today reports the real reason for the Senate's rejection of Bill C-22.
Senator Philippe Gigantes, Deputy Liberal Leader in the Senate, has said, and I quote:
I will continue to oppose any legislation that might make Brian Mulroney
look good.


Some Hon. Members:: Oh, oh!


Robert Nesbitt Horner: If that is the logic behind Mr. Gigantes' action, then it is clear that he knows implementation of Bill C-22 will not only make this Government and the Prime Minister (Mr. Mulroney) look good, it will make them look great.


Some Hon. Members:: Hear, hear!


Robert Nesbitt Horner: Canadians will not be hoodwinked by a small group of Liberal-appointed Senators who have no right to frustrate the will of the electorate and in the process kill the chance for progress in medical technology and jobs all across Canada. We are on to you, Senator!


LABOUR RELATIONS
Mr. Bill Blaikie (Winnipeg-Birds Hill):: Mr. Speaker, as we all know, the Parties involved in the rail negotiations are still meeting and I am certain we all hope a settlement can be reached. However, I want to register my disappointment with the remarks yesterday by the Minister of Transport (Mr. Crosbie) who appeared to take sides on the issue when he came

August 26, 1987
Oral Questions
to such a spirited defence of the existing job security arrangements at CN, It is those very arrangements that the rail unions want improvements in and they are bargaining over that.
It was very inappropriate in my judgment for the Minister of Transport to appear to take the company side. It gives one pause as to just what kind of back to work legislation we might get if it comes to that.
I also want to say it was unfortunate that the Minister tried to maintain that what is going on with the rail strike is unrelated to deregulation. In their arguments at the negotiating table the railways themselves are saying this is related to deregulation, and for the Minister to say otherwise shows either a great deal of incompetence, or something else.


CANADIAN BROADCASTING CORPORATION
Mrs. Mary Collins (Capilano):: Mr. Speaker, it was gratifying yesterday and equally so today to see the thousands of people out on the lawn of Parliament Hill demonstrating in support of Bill C-22.


Some Hon. Members:: Hear, hear!


Mary Collins: Such a visible show of support on the Hill for the efforts of our Prime Minister (Mr. Mulroney) and Government is unprecedented in my time here. Even so, CBC TV did not consider it newsworthy enough to report on The National news last night. That would have enabled Canadians across the country to see this kind of support.


Mr. St. Germain:: Socialist International.


Mary Collins: I can assure my colleagues that, but for the great physical distance between British Columbia and Ottawa, the people of my province would also be here to demonstrate their support. Why? Because British Columbians know that hundreds of jobs will be created in that province as a result of Bill C-22. They know these will be the best kind of jobs, research jobs in the high-tech pharmaceutical industry. Already over $121 million has been committed for pharmaceutical research and development in British Columbia.
It is frightening to think that these investments are in serious peril because opposition Members and Senators delay and dilly-dally with this vital legislation. Let the Members of the other place open their ears and hear the chants on the Hill, from British Columbia to Newfoundland: Bill C-22 must go through!


Some Hon. Members:: Hear, hear!



QUESTION PERIOD


Right Hon. John N. Turner (Leader of the Opposition):: Mr. Speaker, my question is directed to the Prime Minister.
We on this side of the House are in favour of an elected Senate. The New Democratic Party advocates the abolition of the Senate. What formula does the Prime Minister support at the present time?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, the formula mentioned in Part VI of the Meech Lake Accord where it is provided that annual conferences of the First Ministers shall be convened once a year, commencing in 1988. Section 2 reads as follows:
(2) The conferences convened under subsection (1) shall have included on their agenda the following matters:
(a) Senate reform, including the role and functions of the Senate, its powers, the method of selecting Senators and representation in the Senate;



PRIME MINISTER'S POSITION

John Napier Turner: Mr. Speaker, the Prime Minister is desperately climbing back to high ground. On April 19, 1985, in an interview with The Globe and Mail the Prime Minister said he opposed an elected Senate. On June 7, 1985, the Prime Minister and the Minister of Justice introduced a motion to limit the powers of the Senate. The Prime Minister refused to take part in debate on that motion and then killed it at the end of the day.
Yesterday in this House in the space of 15 minutes the Prime Minister said he wanted to abolish the Senate, reconstitute it, abolish it again, abolish it quickly, follow the constitutional process, improve the Senate, abolish it again, then that he wanted it on the agenda for a constitutional conference, and then that he wanted to reform it. Finally, at the end of the afternoon, he said he wanted to elect it.


Some Hon. Members:: Hear, hear!


John Napier Turner: Even for the Prime Minister that is a tour de force. Would he tell us briefly what his position is at this moment, 2.22 p.m?


Mr. Clark (Yellowhead):: You are counting the hours, are you, John?


Martin Brian Mulroney: Mr. Speaker, that enumeration sounded as confused as Michel Robert's position on the leadership of the Liberal Party.


Some Hon. Members:: Hear, hear!
August 26, 1987


Martin Brian Mulroney: When the President of the Liberal Party was in the private sector he was a member of the Macdonald Commission and in favour of free trade. On July 12 he wanted to-


Some Hon. Members:: Order, order!


Mr. Gauthier:: The Senate is the question.


Mr. Speaker:: Perhaps the Right Hon. Prime Minister would save those remarks for a question which deliberately raises the issue. Perhaps he could come back to answering the question the right hon. gentleman asked him.


Martin Brian Mulroney: Mr. Speaker, I apologize, but inasmuch as the Leader of the Opposition was suggesting the existence of alleged contradictions in my position, 1 thought he would welcome the reference to Mr. Robert who has made some very grave and serious implications which bear upon the Meech Lake Accord.


Some Hon. Members:: Order, order!


Mr. Ouellet:: There is a question of privilege here.


Mr. Kaplan:: This is a real class act.


Mr. Waddell:: Tell us your latest position on the Senate. That is the question.


Martin Brian Mulroney: The Member for Vancouver-Kingsway is asking for the latest position on the Senate. I would like to appoint him, because the NDP is trying to squeeze him out of his riding.


Some Hon. Members:: Hear, hear!


Mr. Speaker:: The Right Hon. Prime Minister has clearly answered the question, but it was not the question put by the Right Hon. Leader of the Opposition.



MEECH LAKE ACCORD

John Napier Turner: Mr. Speaker, the Prime Minister recited the Constitutional Accord signed at the Langevin Building. Under that Accord he is obliged to fill Senate vacancies from a list presented by the provinces.
Is it the Prime Minister's intention to keep his word to his provincial counterparts and appoint to the Senate the people they present to him? Or is it his intention to keep his word which he gave yesterday to the House of Commons that he will abolish the Senate? Or will he keep his word to the regions of the country that he is in favour of an elected Senate? Which two of those three promises does he intend to break?


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: Mr. Speaker, my right hon. friend was present in the House when I
Oral Questions
was asked by the Leader of the NDP on March 5, 1985, the following:
-will the Prime Minister give us his assurance today that he will propose to
the provinces the correct, democratic action, which is to abolish this
abominable institution?
That was in reference to the Senate. I responded that 1 would give that assurance-


Mr. Broadbent:: it is a good description.


Martin Brian Mulroney: It is a good description by the Hon. Member. I responded that:
1 would give that assurance to my hon. friend if the Leader of the
Opposition would stand up right now and say he seconds that motion.
That was on March 5, 1985, and the Leader of the Opposition remained in his seat and declined to give the kinds of approval-


Jean-Robert Gauthier: He spoke on it.


John Napier Turner: 1 spoke on it in this House. You did not.


Martin Brian Mulroney: They asked a question, Mr. Speaker.


Jean-Robert Gauthier: Well, answer the question.


Martin Brian Mulroney: I was asked a question about it. I responded two years ago in regard to the House. Since that time, because nothing had taken place, the Edmonton round began. The First Ministers suggested that the constitutional conference be devoted to bringing Quebec into the Constitution. In the course of that major effort, which has been supported by the three political Parties in the House of Commons, we managed to agree upon a formula which brings Quebec into the Constitution.
A second provision of that provides for Senate reform pursuant to objective criteria that we set out. As a result of that, the Edmonton meeting of First Ministers having been held last year, the meeting of the Premiers will take place in Fredericton and 1 have written to the chairman: "Now that the process of ratifying the constitutional Accord is underway, I want to advise you formally that I shall put forward, on behalf of the Government of Canada, a comprehensive proposal to reform the Senate at our first Constitutional Conference to be convened prior to the end of 1988".


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: I can tell my hon. friend-


André Ouellet: It is a speech. This is Question Period.


Martin Brian Mulroney: If I may just conclude, Mr. Speaker, inasmuch as it interests the Leader of the Opposition and the Leader of the New Democratic Party, I would be happy to instruct the House Leader of the Government to meet with the

August 26, 1987
Oral Questions
House Leaders of the Opposition Parties so that, prior to the next constitutional conference, the Parliament of Canada can put a united front together in terms of Senate reform which I think would be in the interest of all Canadians,



ELECTED SENATE PROPOSAL

Hon. Lloyd Axworthy (Winnipeg-Fort Garry):: Mr. Speaker, we have another example of a new dance craze in the Conservative Party. It is called the Senate shuffle; one step forward, three steps backward, and 15 steps sideways.
The Prime Minister confirmed in his last statement that his position is that he wants to abolish the Senate. In light of that statement that he just made 50 seconds ago-he should not forget it that quickly-when one considers that three out of four of the western Premiers, including two Conservatives, the all-Party Senate and Commons Committee, as well as the Committee of the Alberta Legislature have come forward with major proposals for an elected Senate which more effectively represents the regions, why does the Prime Minister insist upon this position of abolishing the Senate when he knows an elected, accountable Senate is absolutely essential for the full participation of the western regions of the country?


Martin Brian Mulroney: Mr. Speaker, my hon. friend misstates the case very substantially. I proposed in the House of Commons my own preference, supported by the Leader of the New Democratic Party, which was in 1985 that we proceed collectively at that time to abolish collectively the other House.
Since that time, pursuant to a request of the First Ministers, I got together with them on behalf of all parliamentarians of Canada and sought a new formula which would unite Canada, and it was called the Meech Lake Accord. Everyone in the House, by and large, supported that.
Because the Liberals refused to deal with the Senate in 1985, when we reached the Accord in 1987 one of the provisions in that allows for First Ministers to deal with Senate reform at our first constitutional conference in 1988. Surely, if the Member from Winnipeg is supportive of the Meech Lake Accord, he will support the second proposition in the Meech Lake Accord which is Senate reform at the next meeting in 1988.


Lloyd Axworthy: Mr. Speaker, the Prime Minister is turning a dance craze into a whirling dervish. Now we don't know where he stands on anything.


Some Hon. Members:: Oh, oh!


Mr. Speaker:: I think 1 probably speak on behalf of all Members in indicating to Hon. Members that it is my feeling that the preambles are getting very lengthy indeed.


André Ouellet: What about the answers? Come on.


Mr. Speaker:: I shall be watching them. I am sure that, if the preambles are shortened, Hon. Ministers will co-operate in shortening the answers.



PRIME MINISTER'S MESSAGE TO PREMIERS

Lloyd Axworthy: Let me put
a very straightforward question to the Prime Minister, something he probably-


Mr. Crosbie:: That is unusual.


Charles Joseph Clark: You are incapable of doing that.


Lloyd Axworthy: I know we won't receive a straightforward answer, but let us try. The Prime Minister said yesterday he wants to reform the Senate. Is the Prime Minister prepared today to telex the provincial Premiers, who are meeting this weekend in Saint John, clearly stating that this House will go on record, as the Right Hon. Leader of the Opposition said yesterday, in endorsing a Senate reform package with an elected Senate more effectively representing the regions? Will the Prime Minister telex the Premiers asking if they are in agreement with that position and then we can get on with the business of making sure the regions of this country are effectively represented at the national level?


Martin Brian Mulroney: Mr. Speaker, if my hon. friend had been listening to the answer, he would have heard in response to the Right Hon. Leader of the Opposition I have already done that. 1 have conveyed the message to Premier Hatfield who is chairing the conference of Premiers on the process of ratifying the Constitutional Accord now under way:
I want to advise you formally that I shall put forward, on behalf of the
Government of Canada, a comprehensive proposal to reform the Senate at our
first Constitutional Conference to be convened prior to the end of 1988.
That 1 have said very often will be the kind of proposal which, I can assure my hon. friend, will make the institution more democratic, and which I think he would agree would stop the kinds of statements we saw today where Senator Philippe Gigantes said that he will continue "to oppose any legislation that might make Brian Mulroney look good".


Some Hon. Members:: Order.


Martin Brian Mulroney: That is a shame and disgrace to parliamentarians and to the Liberal Opposition.


Some Hon. Members:: Oh, oh!



POSITION OF NEW DEMOCRATIC PARTY

John Edward Broadbent: Mr. Speaker, my question is directed to the Prime Minister. Only a few minutes ago the Prime Minister indicated his desire for a Senate reform that would reduce the powers of the Senate. At the same time, the Leader of the Opposition has made it clear that his party is against the concept of an unelected Senate. The
August 26, 1987

Premiers are having a meeting during the weekend in Saint John. Considering the objectives of all three Parties, would the Prime Minister send the following clear message to the Premiers at Saint John: That we, gathered here in the House of Commons, wish to adopt the motion presented by the former Minister of Justice and that the Prime Minister supported a few moments ago. We can immediately adopt this resolution, whose purpose is to reduce the present powers of the Senate. Thanks to this motion, we could immediately start the very important process of Senate reform.


Martin Brian Mulroney: Mr. Speaker, I would ask my hon. friend to remember that considering the fact that we are committed to the Meech Lake Accord-we made that commitment on June 3-there are certain procedures to be followed. And that is perfectly normal.
I have already advised the Premiers that acting on behalf of the Canadian Government, 1 intend to table a comprehensive proposal on Senate reform. Furthermore, today 1 have advised the House Leaders of the other Parties that the Deputy Prime Minister is prepared to meet with them to find out whether we can agree on a formula, perhaps unanimously, for tabling this constitutional proposal. It will be a great day for Canadian democracy, and I invite my hon. friend, the Leader of the New Democratic Party, to pledge his co-operation.



REQUEST THAT PRIME MINISTER SEEK SUPPORT OF PREMIERS TO CURB SENATE POWERS

John Edward Broadbent: Mr. Speaker, the Prime Minister knows that the process about which he is talking is one that can in fact take a number of years, even if it is begun in good faith by the Premiers of the provinces and the Parliament of Canada. I would like to suggest to the Prime Minister something that could be attractive to all the Premiers now, all of whom are on record, to my knowledge, as opposing the existing powers of the present Senate, as are the Parties in the House of Commons.
Since it requires only seven of the Premiers to agree at this point before the Meech Lake Accord is agreed upon, will the Prime Minister make an immediate request to the Premiers, independent of the Meech Lake Accord agreement, to take action now, which they could do in the next 48 hours, to support the resolution that was introduced by the Minister of Justice two years ago and which then had the Prime Minister's support? That, surely, could be a major first step in Senate reform.


Martin Brian Mulroney: Mr. Speaker, my hon. friend is right, it could have been when he and 1 agreed on it in 1985 and we could not get the Leader of the Liberal Party to agree.


John Edward Broadbent: We can do it. We can do it now.


Martin Brian Mulroney: No, no. No, it cannot today.
Oral Questions


Lloyd Axworthy: You have a majority.


Martin Brian Mulroney: It cannot today. The Leader of the New Democratic Party says this proposition would be attractive to all Premiers now. That is not the case.


John Napier Turner: Why?


Lloyd Axworthy: Why not?


Martin Brian Mulroney: Because, pursuant to the Edmonton initiated round the question of the powers and the future of the Senate came up at Meech Lake, and it was agreed unanimously during the course of that round that the Senate, indeed, would be reformed pursuant to an agreed upon clause that is in the Meech Lake Agreement. To violate that clause would be to violate the Meech Lake Agreement. So my proposal to my hon. friend is this-


André Ouellet: Today you realized you were wrong yesterday.


William Alexander (Bill) Blaikie: Shut up over there.


Martin Brian Mulroney: My proposal to my hon. friend, who has been very consistent in this area, both of constitutional reform and vis-a-vis the Senate, is that he authorize his House Leader to sit down with the Deputy Prime Minister so we put together an unanimous package of Senate reform that the Prime Minister of Canada can then bring to the Constitutional Conference in 1988, which would be subject to parliamentary review and debate prior to the Constitutional Conference. It seems to me that would be very much in keeping with our democratic traditions and would be excellent for the House of Commons.



REQUEST THAT RESOLUTION BE PLACED BEFORE HOUSE OF COMMONS

John Edward Broadbent: Mr. Speaker, whatever happens down the road that will require, as the Prime Minister knows, unanimous agreement from all the provinces. Surely it is consistent with the spirit of Meech Lake, if I can put it that way, and consistent with the expressed will of the Premiers who have talked about this in public, if we pass a resolution in this House, supported by the Government and at least the New Democratic Party-we could do this within 24 hours-that would at least reduce the existing powers of the present Senate. That would be a first major step toward democracy. After that we could move toward the much more substantial reform about which the Prime Minister talks. Will he at least do that?


Martin Brian Mulroney: Mr. Speaker, my hon. friend submits a resolution to reduce the power of the existing Senate. We have in train, now in place within months, a procedure which will allow us all to operate very profound and fundamental reforms of the Senate. I have asked my hon. friend today for his co-operation in trying to put forward a package that would be unanimous, representing all Members of the House of Commons, in view of the kind-

August 26, 1987
Oral Questions


John Napier Turner: What?


Lloyd Axworthy: What is it?


Martin Brian Mulroney: He asks what is it. I have already indicated, if my hon. friend will listen, that it is the intention of the Government of Canada to submit a comprehensive program for Senate reform which is a necessary corollary to our undertakings at Meech lake.
I point out to my hon. friend, who has been supportive not only of the idea of Senate reform, but supportive of the Meech Lake Agreement, something I think my hon. friend knows. Having signed the Agreement and having had that approved by all Members of this House of Commons pursuant to June 3, the Prime Minister and the Government of Canada have bound themselves to respect the provisions of that Agreement. That Agreement provides for comprehensive Senate reform to be considered by the First Ministers in 1988.


Some Hon. Members:: Order.


Martin Brian Mulroney: That is what I plan to do. I hope 1 will have the full support of the Leader of the New Democratic Party and, hopefully, the Liberal Opposition.



PROVISIONS OF MEECH LAKE ACCORD

Robert Phillip Kaplan: Mr. Speaker, my question is directed to the Prime Minister.
Why does the Prime Minister feel that today he is bound by the Meech Lake Accord, but yesterday he was not and he could propose a dramatic Senate change?


Martin Brian Mulroney: Mr. Speaker, the question is baseless, inaccurate, and misleading.


Some Hon. Members:: Oh, oh!



ABOLITION PROPOSAL

Robert Phillip Kaplan: Today the Prime Minister states that my Leader is not entitled to propose any Senate reform other than the Meech Lake Accord. Yesterday the Prime Minister himself proposed a totally different change: abolition. Why was the Prime Minister allowed to do it yesterday, and my Leader, and the Leader of the NDP not allowed to do it today?


Martin Brian Mulroney: Mr. Speaker, when the matter of abolition came up in 1985, the Leader of the Liberal Party declined to endorse what the Leader of the NDP and I were interested in proposing.
Personally, I am very doubtful about the value of a non-elected Senate, particularly when it is causing the loss of thousands of jobs in Toronto and Montreal.
I want the Liberals to deal with that anti-democratic feeling in their own Party first.



PRIME MINISTER'S POSITION

William Alexander (Bill) Blaikie: Mr. Speaker, in respect to trying to understand the position of the Prime Minister with regard to Senate reform, I remind him that yesterday he stated to the Leader of the Opposition that he was prepared to "-undertake today to meet so that we can arrange for a resolution to go before both Houses to provide for the abolition of the Senate-"
That was the position of the Prime Minister yesterday. Why is he preoccupied today with a process which he says is in train that yesterday he was prepared to derail completely? Why one position yesterday, and another today?
This is a very serious matter, and I think that the House and the people of Canada deserve a more coherent response from their Prime Minister.


Martin Brian Mulroney: Mr. Speaker, there is no problem with the abolition of the Senate. There is no problem whatsoever. The Leader of the NDP and I discussed this at length in 1985. What the Leader of the Opposition said yesterday-


André Ouellet: The same old record, repeat the same things as yesterday.


Martin Brian Mulroney: I would invite you to check Hansard.
What the Leader of the Opposition was referring to yesterday was a reform project, and replacing the Senate with an elected Senate. That is at variance with the undertaking of the Meech Lake Accord, wherein we have agreed with the provinces to meet in 1988 to reform the Senate in that manner.
If we have the undertaking of the Leader of the Official Opposition, because yesterday he said that he would deliver the Liberal Senate, and if he is prepared to say today that he will deliver the Liberal Senate in support of a resolution which will result in the immediate abolition of the Senate, that is something that I would be very interested in having the House Leaders meet to discuss immediately.



CURBING SENATE'S POWERS

William Alexander (Bill) Blaikie: The Prime Minister has acknowledged that the process which he has in mind may take some time. There will be a constitutional conference in 1988. There is no guarantee that there will be unanimous agreement at that conference, therefore the process could go on for some time.
Why is the Prime Minister unwilling to consider the proposal of the Hon. Member for Oshawa that the House take steps within its power under the present amending formula which would only take seven provinces constituting 50 per cent or more to limit the powers of the Senate, which the Prime Minister now states that he wishes abolished and replaced? Why can that measure not be taken in the meantime?
August 26, 1987


Martin Brian Mulroney: Mr. Speaker, I have indicated already my support of the idea of the Leader of the NDP. I have responded fully in regard to the abolition. I would be happy to discuss this with the First Ministers. I raised it myself. I put forward for the First Ministers' consideration the abolition of the Senate, and 1 was prepared to come back to the House of Commons and seek your permission and endorsement, inasmuch as the Leader of the NDP and I had already had that discussion.
In terms of the abolition of the Senate, 1 believe in its present capacity it is undemocratic, and it does not reflect the needs and the values of the people of Canada. I was ready to propose its abolition at that time. Since that time, with the support of all Members of the House of Commons, I signed an undertaking in terms of Senate reform for the future.
I am happy to bring forward a program of Senate reform. I invited the Leader of the NDP, and the Leader of the Liberals to delegate their House Leaders in order that we could bring forward a comprehensive program for Senate reform.



LABOUR RELATIONS


André Ouellet: Mr. Speaker, my question is directed to the Minister of Labour.
Yesterday the Government gave notice of legislation to deal with the rail strike. Does this mean that the Minister has lost hope of a negotiated settlement?


Hon. Pierre H. Cadieux (Minister of Labour):: On the
contrary, Mr. Speaker.



JOB SECURITY ISSUE

André Ouellet: If the Minister believes and has hope that there will be a negotiated settlement, what types of munition has he given his chief negotiator, Mr. Kelly, who is very well-known and very experienced in this area? I have been informed that the feelings of the workers are that Mr. Kelly is in an impossible situation, because he has absolutely no room to manoeuvre.
Will the Minister indicate to us if Mr. Kelly has in hand, or in his pocket, a deal that will allow the workers the same type of employment security that exists, for instance, in the Ontario Northland Railways for their employees?


Pierre H. Cadieux: Mr. Speaker, I wish to repeat an answer that I gave yesterday to a similar question. I gave the answer in French, so I will read the translation:
Oral Questions
Mr. Speaker. 1 would like to point out to the House that right now, parties
are the masters of their own fate at the bargaining table, and I encourage them
sincerely to come to a negotiated settlement.



REQUEST THAT MINISTER MEET NEGOTIATORS PRIOR TO INTRODUCING LEGISLATION

Mr. Rod Murphy (Churchill):: Mr. Speaker, my question is also directed to the Minister of Labour. I too hope that negotiations will conclude successfully.
Yesterday in the House the Minister of Transport gave a very passionate defence of the present CN position on job security. Workers feel that they are in jeopardy in terms of getting an impartial and fair piece of legislation through this House.
If negotiations break down, will the Minister guarantee to meet with both sides prior to introducing legislation in this House?


Pierre H. Cadieux: Mr. Speaker, I would like to repeat the answer that I gave a moment ago.
The parties are at the table, they have their own fate in their hands. I encourage them to come to a negotiated settlement. If they do not, I will act quickly.



MINISTER'S POSITION

Rodney Edward Murphy: The words of the Minister of Transport make it difficult for both sides to feel that they will get a fair shake from the Cabinet.
I again ask the Minister, not to delay legislation, but to assure both sides that they will have an audience with him prior to his introducing legislation in the House. Will the Minister do that?


Pierre H. Cadieux: Mr. Speaker, I think that the best fair shake the parties can have is the one they presently have at the table where they have their own fate in their hands, and where they can negotiate the terms of their own collective agreement. I encourage them to do that. If they don't, and if they fail, I will act quickly.



AIR CANADA


Mr. Brian Tobin (Humber-Port au Port-St. Barbe):: Mr. Speaker, my question is directed to the Prime Minister. It concerns the future of Air Canada.
Last spring the Minister responsible for privatization told the House that Air Canada was under consideration by the Government as a target for privatization. At that time the Minister promised the people of Canada, and the management

August 26, 1987
Oral Questions
of Air Canada, that a decision would be forthcoming this summer.
In light of the urgent need for the management of Air Canada to make plans for fleet replacement from now until the year 2000, can the Minister of State for Privatization, or indeed the Prime Minister himself, tell Canadians and the House what decision the Government has made with respect to Air Canada?


Hon. Barbara McDougall (Minister of State (Privatization)):: Mr. Speaker, I am not in a position to explain to the House a decision on Air Canada, because none has been taken.
As 1 have pointed out to the House a number of times, the situation in regard to Air Canada, as with Petro-Canada and Radiochemical Company is under review. We will make a decision when consideration has been given to all relevant
issues.
These are complex matters, and they are important to many people, including the company. We will make the correct decision when we are ready to make it.



PRIVATIZATION-REPORTED PRINTING OF BROCHURES

Brian Vincent Tobin: Mr. Speaker, the Minister's answer sounds like the Prime Minister's description of his position on the Senate-somewhat confused. Will the Minister be forthright with respect to this question? The fact of the matter is Air Canada has printed 25,000 brochures explaining the Government's decision to privatize Air Canada. Obviously there has not been a decision made here. Either one was made and it was reversed, or Cabinet has not made a decision.
In the event that the Prime Minister has vetoed the position of the Minister of Transport and the Minister of State for Privatization in consideration of looking consistent on this question, is the Government prepared to subsidize Air Canada, to rebate to Air Canada the tremendous cost and expense it has incurred in printing brochures to explain a position which has now been reversed by the Prime Minister of Canada?


Barbara Jean McDougall: Mr. Speaker, I am not employed by Air Canada. It prints brochures as it may see fit. I am the Minister of State for Privatization. I have answered the question already. I would be very interested in knowing where the Hon. Member stands on this issue.



THE SENATE


John Edward Broadbent: Mr. Speaker, I wish to address my question to the Prime Minister. A few minutes ago in reply to the Hon. Member for Winnipeg-Birds Hill the Prime Minister suggested that he would be prepared to consider a proposal I made earlier, namely, that a request go to the Premiers to look at taking action now under the existing amending formula which would require just seven provinces to agree to the resolution that the Government itself introduced to reduce the existing powers of the Senate.
Would the Prime Minister clarify that suggestion since the Government proposed it, since we are in agreement with it, and I hope that the Official Opposition would agree? Is he now saying that he would be prepared to have this message relayed to the Premiers who will be meeting tomorrow, to get their response to that quite specific kind of reform of existing powers?


Martin Brian Mulroney: Mr. Speaker, I have indicated to the House that I have already written to the Premiers indicating the intention of the Government, as agreed, to bring forward a comprehensive proposal in regard to Senate reform.
Because of the interest in the matter, most recently yesterday and the day before, I indicated that, clearly, a comprehensive, unanimous expression of the House of Commons is better than one arrived at unilaterally. Thus I have instructed the Government House Leader to be ready to meet with the Opposition House Leader and the House Leader of the New Democratic Party to work out the modalities that would perhaps give rise to an expression of opinion on this important matter. Therefore, as Prime Minister of Canada I could go forward on behalf of all Members of Parliament to express a single view of the reform of the Senate which, clearly, all of us want.



POSITION OF PREMIERS

John Edward Broadbent: Mr. Speaker, I do not want to question the Prime Minister's sincerity on this very important subject. However, considering that the Government has expressed its will on the limited type of reform that I am now addressing, and for which I have indicated our support; and considering that even with the goodwill of all the parties concerned it could take a number of days to discuss a more comprehensive resolution, will the Prime Minister please contact the Premiers to see if they will agree to this simple resolution? All they have to do is say no. They are meeting there for two days.
If they believe that it is inconsistent with Meech Lake, which I do not, then they can say no. Or, if seven of them believe in limited and specific restriction of powers of the Senate, and if they want to move in that important way toward
August 26, 1987

democracy, then all 1 can say is that all Canadians will be cheering them on.


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: Mr. Speaker, in the various discussions that I have had with the First Ministers there is general agreement on one thing. It is that the present Senate as constituted is profoundly undemocratic and must be reformed.


Some Hon. Members:: Hear, hear!


Mr. Hnatyshyn:: And Bill C-22 proves it!


Martin Brian Mulroney: I think that what we see going on today with Bill C-22, the Senate depriving the creation of thousands of jobs in Ontario, Quebec and across the country, is an indication of the anti-democratic nature of the Senate.


Mr. Keeper:: So do something!


Mr. Speaker:: 1 think all Hon. Members would want the Chair to try to guide the answers back to the actual question, although the matter which the Right Hon. Prime Minister raises has of course been the subject of exchange. I think that the question that the Leader of the New Democratic Party put was fairly clear. I think that the Right Hon. Prime Minister has met that question.



MULTICULTURALISM


Mr. Sergio Marchi (York West):: Mr. Speaker, my question is for the Minister responsible for multiculturalism. In the minutes of the Conservative caucus agenda of last Wednesday, August 19, under the name of his own Parliamentary Secretary, the Hon. Member for Duvernay, it states:
The request from MTV which is before the CRTC should be blocked. This
action would be viewed favourably by Quebec ethnic groups.
Given that the Toronto MTV application endeavours to establish a nation-wide multilingual, multicultural television station, and without getting into the particulars of the application, can the Minister tell the House whether or not he agrees with the views of his Parliamentary Secretary who advocates that the Government politically block this application? Can he explain why ethnic groups in Quebec would oppose such a broadcasting initiative?


Hon. David Crombie (Secretary of State of Canada):: Mr. Speaker, I was not at the caucus meeting last Wednesday. I do not know the material to which the Hon. Member refers. Since he has the minutes perhaps he could send them over to me. I will take a look at them and if there is any wisdom or light I
Oral Questions
can shed on the question he has raised, then I would be only too pleased to do so.


Some Hon. Members:: Hear, hear!



VIEWS ATTRIBUTED TO PARLIAMENTARY SECRETARY

Sergio Marchi: Mr. Speaker, since the Minister was not at the caucus meeting I would like to address a question to his Parliamentary Secretary. The Parliamentary Secretary said yesterday in a public interview that he agrees and does not retract the comments which are clearly attributed to him in the minutes of that caucus meeting. Therefore, I would like to ask the Parliamentary Secretary whether his views to block the CRTC application reflect the views of the Government and the Minister of Communications? If so, do you not think that it is most inappropriate for you to interfere politically with the-


Some Hon. Members:: Order, order.


Mr. Speaker:: Order, please. I will simply help here a bit. First, when the Minister is here it is not appropriate that the Parliamentary Secretary answer. Second, I know that the Hon. Member does not intend to use the personal pronoun "you" in his question. However, the question is there, the Minister is here, and I would ask the Minister to see if he can answer it.


David Edward Crombie: Mr. Speaker, again I have to say that I do not have the material. I have not yet spoken to the Parliamentary Secretary. The only thing I can suggest is that the Hon. Member may want to exchange caucus minutes with me, and I will do what I can with respect to conversations between those who are involved.
With respect to the substance of the matter, the matter is of course an important one and I will take it under that light and within that consideration.



FINANCIAL INSTITUTIONS


Mr. Simon de Jong (Regina East):: Mr. Speaker, my question is for the Minister of State for Finance. This evening in Edmonton thousands of angry Principal Group investors are meeting to demand a full and public inquiry. They want to get at all the facts concerning the role of provincial and federal Governments in the collapse of Principal Group.
Since the Governments of Alberta, Saskatchewan, and British Columbia have all rejected calls for a public inquiry, is the Minister prepared to do what the investors want and establish a public inquiry to investigate fully the collapse of Principal Group?

August 26, 1987
Oral Questions


Hon. Tom Hockin (Minister of State (Finance)):: Mr. Speaker, absolutely. The Government of Alberta is conducting a public inquiry. It is a full and open public inquiry. I gather the Premier of that province has gone further and said that if in any way the Government has made some mistakes it will act in such a way as to compensate.



ALLEGATIONS OF MISREPRESENTATION-PROGRESS OF INVESTIGATION

Simon Leendert de Jong: Mr. Speaker, the inquiry that is occurring in Alberta is restricted. I will address my next question to the Minister of Consumer and Corporate Affairs.
On August 12 the Minister of State for Finance assured me that he would inform the House shortly of the results of an investigation concerning the allegations of misrepresentation. Is the Minister of Consumer and Corporate Affairs now prepared to tell us if that investigation has been completed and if charges are being considered?
Hon. Harvie Andre (Minister of Consumer and Corporate
Affairs): Mr. Speaker, as I indicated, the Marketing Practices Branch under my Department conducts these investigations under a mandate given it by Parliament, not by me. It has involved the RCMP in this investigation. It had indicated two or three weeks ago that it was expecting to be done by the end of August and it will be making recommendations or not making recommendations to the Attorney General based on that investigation. As the Hon. Member understands, I have no right to interfere with that investigation and I do not intend to do so.



MUNICIPAL AFFAIRS


Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, my question is addressed to the Minister of State for Finance. As the Minister probably knows, sewers, beaches and the general water quality across Canada are badly in need of attention. Since its election, the Government has paid no attention to them at all.
Recently the Government of Ontario asked Ottawa to participate in its Lifeline Program, a program designed to clean up our waters, by assuming one-third of the costs of the program. Ottawa said no. Will the Minister reconsider Ottawa's negative decision and ensure Ottawa's participation in Ontario's Lifeline Program to the extent of one-third of its costs?


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, I am not directly aware of the details of this Lifeline Program to which the Hon. Member has referred. In his preamble he
referred to the broader question of municipal infrastructure. I think the position we made clear in this House is very well understood and I do not think I need to make any further comment on that.



MINISTER'S POSITION

Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, this is a very disappointing answer. It is my understanding that the Ontario Minister of the Environment has put this proposal to the Government of Canada through the Minister of Finance.
If the Minister of Finance can find money to subsidize nuclear submarines, surely he can find money to repair and improve the quality of water. Therefore, my question simply is why is water quality not a major priority of the Minister?


Michael Holcombe Wilson: Mr. Speaker, water quality is a a major priority of the Minister of Finance and of this Government. I think the Hon. Member has put into his question a number of elements that relate to the broader question of municipal infrastructure. I am quite prepared to look at the Lifeline Program and its constituents to see whether things do qualify for federal funding. However, if it falls under the question of municipal infrastructure, that question has been raised on a number of occasions and 1 think the Hon. Member is aware of the position taken on it.


Mr. Speaker:: The Hon. Member for Vancouver East will have a single question and that will be the last one in Question Period.



CHILD CARE


Ms. Margaret Mitchell (Vancouver East):: Mr. Speaker, my question is directed to the Minister of National Health and Welfare. Why is child care such a low priority of the Government? Why have there been so many postponements? First there was the postponement from June 30 and then the "Dear Shirley" letter. Now we understand that the Minister has sent messages to provincial Ministers asking for another delay. What is the problem? Why can we not at least have the Minister table the national objectives for child care, or does he not have any?


Hon. Jake Epp (Minister of National Health and Welfare):: Mr. Speaker, child care is not a low priority of the Government. That has been stated very clearly, not only in terms of a program the Prime Minister has very clearly endorsed and led, but additionally there are moneys being spent at the present time. We know that the amount must be increased and these issues are being dealt with by Cabinet. I think fair-minded people recognize their complexity in terms of provincial jurisdiction and the ability to pay which varies from province to province. These considerations are being examined very
August 26, 1987
clearly. It is a high priority on the Minister's agenda. It is not a low priority for us, it might be for her.



ROUTINE PROCEEDINGS


Hon. Flora MacDonald (Minister of Communications):: Mr. Speaker, pursuant to Standing Order 99(2), I have the honour to present the Government's response, in both official languages, to the Fifth and Sixth Reports of the Standing Committee on Communications and Culture.

The fifth report, dated April 27, 1987, is entitled "An Interim Report on the Recommendations of the Task Force on Broadcasting Policy: Specialized Services and some-


Mr. Speaker:: Order, please. The Hon. Leader of the NDP (Mr. Broadbent) and the Right Hon. Prime Minister (Mr. Mulroney) are quite unintentionally standing between the Hon. Minister and the Chair. Would the Hon. Minister please continue?


Flora Isabel MacDonald: Mr. Speaker, the fifth report, dated April 27, 1987, is entitled "An Interim Report on the Recommendations of the Task Force on Broadcasting Policy: Specialized Services and some Proposed Legislative Amendments", and the sixth report, dated May 6, is entitled "Recommendations for a new Broadcasting Act".


PRESENTATION OF REPORT OF LEGISLATIVE COMMITTEE ON BILL C-7I
Mr. Bill Attewell (Don Valley East):: Mr. Speaker, on behalf of the Hon. Member for Quebec-Est (Mr. Tremblay), the Chairman of the legislative committee on Bill C-71, an Act to amend the Criminal Code, the Immigration Act, 1976, and the Citizenship Act, I have the honour to present the Bill to the House without amendment.
This is an historic moment. While it is over 40 years late, this Government had the moral courage to study the issue of alleged war criminals living in Canada through the Deschenes Commission and to present Bill C-71 to provide legislation to prosecute any war criminals or those who have committed crimes against humanity in the past or who do so in the future.
_______________________________8431
Petitions PETITIONS


REQUEST TO CHANGE ALLEGED DISCRIMINATORY PROVISIONS OF UNEMPLOYMENT INSURANCE REGULATIONS
Hon. William Rompkey (Grand Falls-White Bay- Labrador):: Mr. Speaker, I have the honour to present petitions on behalf of the residents of the Labrador coast and the communities of Nain, Rigolet, Makkovik, Hopedale, Postville, Cartwright and Cape Charles, all calling upon the House and the Government to change the discrimination which now exists in the unemployment insurance regulations; whereas, fishermen on the Labrador coast cannot continue to collect unemployment insurance benefits up until the time they go fishing, namely, the beginning of July, and must forsake those benefits in the middle of May. The petitioners call upon the House to change this discrimination.


OPPOSITION TO TAX ON FOOD
Jean-Robert Gauthier: Mr. Speaker, it is again my duty today to table a petition signed by residents of Canada who now avail themselves of their ancient and undoubted right thus to present a grievance common to your petitioners in the certain assurance that our Honourable House will therefore provide a remedy. The petition reads as follows:
Whereas since September, 1984, the federal Government has imposed upon Canadian taxpayers 25 new taxes or tax increases, in particular on medical and dental supplies, snack food, candies and soft drinks;
Whereas the federal Government in its tax reform proposal is studying the possibility of imposing a general tax on goods and services, including food;
And whereas food constitutes a vital element to every-day life, and whereas the imposition of this tax would have the effect of penalizing certain categories of taxpayers, for example, the aged, families, the unemployed, low income taxpayers, and youth;
Therefore, the petitioners humbly pray and call upon Parliament to reject all measures that would have the effect of imposing a sales tax on food products.


REQUEST TO REJECT BILL C-22
Marie Thérèse Rollande Killens: Mr. Speaker, I have here petitions with a total of 406 signatures, including 161 from the Asbestos and Danville area, 25 from Sherbrooke, 80 from the Montreal Metropolitan area, 109 from the cities of Toronto, Scarborough, Almonte, Kingston, Brampton, Etobicoke in Ontario, and finally 26 from Calgary in Alberta.
Mr. Speaker, I am pleased to table these petitions so that the people who have signed them an add their voices to the attention of a great many Canadian men and women and ask the Parliament of Canada to turn down Bill C-22 which would certainly increase the prices of medicinal drugs.



August 26, 1987
Order Paper Questions


CHILD ABUSE-REQUEST FOR LEGISLATIVE ACTION
Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, I have the honour to present a petition signed by a large number of residents of Burnaby, Richmond, Delta, Vancouver and North Vancouver. They were particularly inspired by my constituent Pat Stephens, who raised serious concerns over the present provisions of the Criminal Code regarding child abuse. They ask that more severe sentences be given to offenders, that all child sexual abusers be tested for AIDS, that authorities forward information regarding child sexual abusers and their new addresses to the Police Department of the city they move to, and that a minimal amount of time elapse between the laying of charges and the date of sentencing, thus lessening the emotional strain on the victims of such abuse. My petitioners call upon Parliament to take effective action on this important matter.


REQUEST FOR EXTENSION OF ISOLATED TAXATION BENEFITS
Mr. John Gormley (The Battlefords-Meadow Lake):: Mr. Speaker, in my continuing efforts to have isolated taxation benefits extended to the communities of Meadow Lake, Dorintosh and Rapid View in northwestern Saskatchewan, I have not only the duty but the honour to present 10 further petitions containing hundreds of signatures of residents of those communities who call upon Parliament to consider the extension of isolated taxation benefits to those communities which should be included in the new schedule when it is tabled.


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


Mr. Speaker:: Is it agreed?


Some Hon. Members:: Agreed.


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


Mr. Speaker:: Shall all notices of motions stand?


Some Hon. Members:: Agreed.


BUSINESS OF THE HOUSE
Svend Johannes Robinson: Mr. Speaker, on a point of order, I would like to ask the Parliamentary Secretary to the President of the Privy Council (Mr. Lewis), in light of the remarks of the Hon. Member who tabled the report from the legislative committee on Bill C-71 respecting war criminals, whether the Government is prepared to call that Bill for third reading today. We in this Party are prepared to proceed immediately with third reading of this important legislation without further debate. I have discussed this matter with my friend and I hope the Opposition House Leader would be prepared to agree as well.


Mr. Prud'homme:: We are on Bill C-22 now.


Philip Derek Lewis: Mr. Speaker, I agree with my friend. In keeping with the normal practice I will be glad to discuss this matter with the House Leaders of the other two Parties, and if that is agreeable to them, we will proceed to do something as soon as possible.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Tuesday, August 25, consideration of the motion of Mr. Andre:
That a Message be sent to the Senate to acquaint their Honours that this House agrees with amendment 10(a) made by the Senate to Bill C-22, An Act to amend the Patent Act and provide for certain matters in relation thereto, but disagrees with all other amendments except amendments 1(c) and 8, because this House believes that amendments 1(a) and (b), 2(a) and (b), 3, 4(a) and (b), 5(a) and (b), 6, 7(a) and (b), 9 and 10(b) and (c) are in contradiction to the principles of the Bill which will increase intellectual property protection, increase research and development in Canada, create new high-technology jobs, improve the health care of Canadians, and protect consumers from higher drug prices. More specifically:
Amendments 1(a) and (b) delete the definitions of "Board" and "patentee". These definitions are necessary to support the powers of the Patented Medicine Prices Review Board, which is required to protect consumers.
Amendments 2(a) and (b) reduce Canada's export potential and fine chemical manufacturing.
Amendments 3, 4(a) and (b), reduce the periods of market exclusivity, thus eliminating the incentive for increased research and development in Canada.
Amendment 5(a) reduces the period of market exclusivity and export potential, thus reducing economic benefits for Canada.
Amendment 5(b) deletes the Patented Medicine Prices Review Board, which is required to protect consumers, and this amendment also removes the protection for Canadian-invented medicines and thus the incentives for increased research and development in Canada.
Amendments 6, 7(a) and (b), 10(b) and (c) arise out of amendments 1(a) and (b), 2, 3, 4(a) and (b), 5(a) and (b), and are therefore inappropriate.
August 26, 1987
[Stage Direction]
Amendment 9 arises out of Senate amendment 8, but is not consistent with the House amendment to Senate amendment 8, as set out below.
And, that:
Senate amendment 1(c) be amended to read as follows: "(c) Strike out lines 35 to 42 and add the following:
(2) For the purpose of sections 41.11 to 41.16, the notice of compliance that is first issued for cither the original and distinct chemical composition of a medicine or the obvious chemical equivalent of the medicine shall be deemed to be the first notice of compliance issued in respect of that medicine."
Senate amendment 8 be amended to read as follows: "insert the heading "Transitional" and the following as clause 31:
31.(1) The Minister of Consumer and Corporate Affairs shall pay to each province for each of the fiscal years commencing in the period April 1, 1987 to March 31, 1991, for the purpose of research and development relating to medicine, an amount equal to the product obtained by multiplying
(a)	the quotient obtained by dividing
(i)	$25 million by
(ii)	the total population of all provinces for the fiscal year in respect of
which the payment is made, by
(b)	the population of the province for the fiscal year in respect of which the
payment is made.
(2)	Payment of any amount under this section shall be made out of the Consolidated Revenue Fund at such times and in such manner as the Governor in Council may, by regulation, prescribe.
(3)	For the purposes of this section, the population of a province for a fiscal year shall be the population of that province on the first day of June of that year as determined and published by the Chief Statistician of Canada."
John Napier Turner: Mr. Speaker, as I said on the resumption of Parliament for this so-called emergency session, it is clear the real reason we were called back, only for the thirteenth time since Confederation, has nothing to do with the refugee situation. It has everything to do with the absolutely obscene desire of the Government of Canada to bow to American pressure to amend our drug patent legislation and dramatically raise drug prices in order to maintain the free trade negotiations with the U.S. That is the reason and it is a cop-out, as well as a cave-in to the American pharmaceutical industry and the U.S. trade negotiations.

It is indisputable that Bill C-22 before the House, as introduced by the Government, will increase by several hundred million dollars a year the prices paid by Canadian men and women for their medicinal drugs. That is an indisputable fact. No matter what the Government and the Minister of Consumer and Corporate Affairs (M. Andre) may say, they cannot change that fact. Well, as we could have expected, the Government is trying to have us believe that the prices will not increase, while we all very well know that they will.

Does the Government really think that Canadians were not listening when the leading authority on this issue, Dr. Harry Eastman, stated repeatedly that there is no doubt whatsoever in his mind that drug prices will rise as a result of this Bill?
Patent Act
Let me quote from his November, 1986, interview on CBC's As It Happens. Dr. Eastman had this to say:
The entry of generics which push down prices would be somewhat delayed
and therefore the average prices would be higher than they would be under the
present legislation.
The Minister of Consumer and Corporate Affairs (Mr. Andre) says that is not true. When pressed he repeatedly makes an argument that what we contend is very narrow and highly misleading. He says that under his Bill the cost of new brand name drugs will not be higher than they are now when they first come on the market. His argument is that if last year someone invented a new brand of pain-killer and brought it on the market at $5 a bottle, then invented another brand the following year and brought it on at $5 a bottle, and so on, there is no increase in price. However, when we talk about increased prices we are not just talking about the initial market price of brand-name drugs, we are talking about the total cost of drugs to Canadians. If a generic manufacturer can make the same kind of pain-killer and sell it for $1 a bottle instead of $5, that means the consumer pays less. That is what is at issue herd.
Under this Bill the generic manufacturer will not have the opportunity to produce a drug and sell it to Canadians for seven to 10 years. The consumer will have to pay the higher price for the brand name product until that period elapses. Yet the Minister continues to say that giving patent protection of seven to 10 years, which prohibits the manufacture and sale of cheaper generic drugs during that period, will not increase drug prices. That just does not hold up.

The Minister claims also that the Patented Medicine Prices Review Board, provided for under this Bill, will prevent prices from increasing. But how will it achieve that? The Board will only have the power to set prices which are reasonable and in line with international prices. Well, just now, our prices are generally lower than international prices; for instance, they are two to five times lower than those paid in the United States. With such a criterion in the Bill, it is more than likely that the prices will increase instead of coming down. Moreover, when the time comes for the Board to review the price of a drug developed, say, in the United States or Switzerland, it will not be able to investigate the research costs of this foreign maker. It will have to take the word of pharmaceutical companies, those same companies it has been mandated to monitor.
A number of other studies reached the same conclusion as Dr. Eastman in his report, namely, that extending the duration of the patents will increase the prices of medicinal drugs.
Even the United States trade representative, Clayton Yeutter, has admitted that drug prices will go up. On the CBC's The Journal on November 19, 1986, he said:

August 26, 1987
Patent Act
In some cases maybe this will raise the price at the retail level of some of
these products.
Indeed, Mr. Speaker, some estimates put the cost to Canadians of delaying generic competition at upwards of $5 billion over the 10 years from 1988 to 1997.
An analysis of the various estimates completed in July for the special committee of the Senate on Bill C-22 by the research bureau of the Library of Parliament says that prices will go up. Add to that the Minister's announcement that he intended to provide $100 million to the provinces, originally to cover increased drug prices in the pharmacare and medicare programs but now amended to go to the provinces only if the money is spent on research and development. What was that $100 million for if not as a result of his own anticipation that drug prices will go up?
The Minister says that he has studies which prove that drug prices will not change. We asked him in the House of Commons where those studies are; to produce them and give us the facts. 1 submit that if the Minister had a single scrap of paper to prove his contention that drug prices will not go up he would have plastered it on every billboard in the country. The truth is that he has no such evidence to back up his argument.


Some Hon. Members:: Hear, hear!


John Napier Turner: The Minister's answer to that is that with longer patent protection there will be more research done in Canada and, therefore, more jobs. He says that is the reason he has brought in this legislation. Let us look at the experience in the United States where brand name drugs are given exclusive monopoly protection for a 17-year period. Their prices are now two to five times as high as Canadian prices.
The New York Times of July 28, a newspaper to which I am sure the Prime Minister (Mr. Mulroney) pays close attention after its recent article on him, reports that the head of the Senate Sub-committee on Anti-trust Monopolies and Business Rights is planning hearings this fall on the drug companies' possible anti-trust violations.
U.S. legislators, Congressmen and Senators, have told the brand name manufacturers of the United States that if they do not control their prices more realistically, Congress will consider imposing legislation similar to that which we introduced in Canada in 1969.
It is claimed that higher brand name prices are necessary to fund research and development of new drugs. With regard to that, listen to what representative Harry Waxman, Chairman of the United States Sub-Committee on Health and the Environment, had to say with reference to a study of the 25 largest companies with two-thirds of all prescription drug sales in the United States. This is a quote from the Wall Street Journal of July 20, 1987.
For the years 1982 to 1986 we found that revenue gains due to price
increases were three times greater than their total increase in research and
development expenditures.
We also found that companies spent as much on marketing as they did on research and development. The conclusion is inescapable. The recent price increases are not producing new drugs, they are filling corporate coffers.
if that is what is happening in a jurisdiction with a 17-year monopoly protection, how does the Minister claim he will get research and development in Canada with seven to ten-year protection? The answer is that he is not and he knows he is not.
I have a confidential document produced by our embassy in Washington under what it calls the U.S. Corporate Liaison Program. It is a report on meetings between senior embassy staff in Washington and representatives of the United States industry. One company interviewed was Pfizer Incorporated, one of the largest brand name drug manufacturers in the United States, indeed in the world. This is what the Canadian officials report that the company told them in the course of those discussions.
Firm welcomes proposed Canadian Patent Act amendments but feels they would still fall short of what is called for. Accordingly, it would unlikely make early commitment to significant additional activity in Canada.

The Minister says that 3,000 jobs will be created. The Prime Minister said the same thing yesterday on the Hill before the employees of those pharmaceutical companies. However, according to a study made by the Canadian Drug Manufacturers' Association, the Bill could result in the loss of 9,000 jobs throughout the economy. It would mean a net loss of 6,000 jobs.
He says that under the present rules, the large drug companies do not make any research in Canada but that they will do some if the Bill is passed. How can the Minister say such a thing, say that will happen if his Bill is passed, when he knows full well that even before the 1969 amendments, there was very little research and development work carried out by multinationals in Canada? He even states that he has commitments worth $1,4 billion from drug companies.
However, I have read the Bill. There is no mention of commitments to invest in research. None whatsoever. Those agreements will remain confidential, just like the reviews on which the Minister bases his assertion that prices will not change.
Who is the Minister trying to fool?

Why does the Minister reject the royalty fund proposed by the Senate following the Eastman recommendations? Under that scheme, generics would pay a 14 per cent royalty for the use of brand name discoveries which would be available after four years. The funds would be paid back to the brand name companies for proven research. What better guarantee that money would go back into research for new drugs? The Minister rejects that plan in favour of the United States style system which has been proven ineffective in creating new research and new drugs.
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One must ask oneself why the multinational companies are spending millions of dollars in a lobbying effort here and in the United States to get this legislation passed. That is not a difficult question to answer. They want to shut out the generic competition because generic competition means less money for them.
When I was the first Minister of Consumer and Corporate Affairs, the Department having been set up under the Prime Ministership of the late Lester B. Pearson, I had the privilege to begin the process which led to the changes to the Patent Act of 1969 which the current Government is attempting to reverse with this Bill.

We brought in the Act from which the present regulations derive because drug prices in Canada were exorbitant, as they are now becoming in the United States. Our drugs were among the most expensive in the world in 1969. We wanted more competition in this sector in order to bring down prices. We succeeded. Today, our pharmaceutical prices are among the lowest and the most affordable in the world and even the U. S. Department of Health has studied our legislation to see if it would not be worthwhile to adopt similar legislation to lower drug prices in the United States.
It is well worth noting, Madam Speaker, that in 1969, more competition did not bring about less research. In fact, there was an increase in research activity and according to the study done by Dr. Eastman, during 1983, Canadians saved 211 million dollars thanks to competition from generic drugs. The Minister contends that he has another study which shows that, had his bill been in force in 1983, Canadian consumers would have saved almost an equivalent amount. But, then again, he has not made this study public.
One of the Minister's most pathetic arguments in defending this Bill is that Canada is considered an international pirate. He said that we are stealing other people's ideas. He tells us that our current legislation is incompatible with our international treaty obligations. However, Roy Davidson, a former economic adviser in the Minister's own Department, says that is simply not true.
As Dr. Davidson points out, we are not contravening international patent conventions to which we are signatories. Nowhere in that convention does it say that discoverers or inventors are entitled to a monopoly on the production of their invention, as would be the case for 10 years with the Minister's Bill.
Some countries give no patent protection at all. Japan requires foreign firms to co-venture with domestic firms in the marketing of new drug products. Britain and some other European countries rely on centralized purchasing power to regulate both price and industrial benefits. France and
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Belgium have strict price controls on pharmaceutical products. Each nation attempts to prevent the exploitation of higher drug prices in its own way and in its own jurisdiction.

In 1969, we opted in Canada for compulsory licensing in order to promote competition. And this is what happened. However, the Minister's Bill would put Canada in a unique position in the world as far as drug prices are concerned. Manufacturers will be under no obligation whatsoever to invest in return for the long term protection they will be getting. They will not have to make additional research and development expenditures. There is no obligation, therefore no guarantee.
During the 40 years before 1969, when the current Act went into force, including when I was in charge as Minister of Consumer and Corporate Affairs, foreign corporations enjoyed the kind of protection provided for under Bill C-22. But no new drugs were produced in Canada in those 40 years.
The simple truth is those international corporations will keep on doing their research in their own countries, as they always did, and the Bill will do nothing more than help them increase their profits on the backs of Canadians by restricting competition.
Such has been the experience before the current Act came into force, and I predict such will be the experience if the legislation is passed by this Parliament.
Madam Speaker, who indeed will benefit from the Bill? Not Canadian consumers, that is for sure, but rather the large multinational corporations in the drugs industry. There is absolutely no doubt about that.
We must ask ourselves this question: Why would multinational companies spend millions of dollars to have this Bill passed, to lobby here and in the United States? The reason is clear, they want to make more money.
As underlined by Dr. Eastman, research and development will probably never amount to much in Canada, given the limited size of our domestic market. Remember that we account for only 2 per cent of the world market.
The Liberal caucus and Party have always supported Dr. Eastman's recommendations. They are positive changes to the present Act designed to encourage research and at the same time alter prices. The recommendations of the Senate are based-through the Liberal amendments proposed in the House-on Dr. Eastman's recommendations and we subscribe to them. We consider it necessary to strike a balance between protection of intellectual property and prices paid by consumers, and we believe that Dr. Eastman did just that in his report.

We have heard a lot of rhetoric from the Prime Minister and various Ministers about how an non-elected Senate is attempting to thwart the will of the people. In one breath, the Prime Minister say, "They have no right whatsoever to change

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our legislation". Then in the next breath his Minister accepts Senate amendments on the transportation legislation. The Minister for Consumer and Corporate Affairs accepts one amendment in total and two others in modified form. The Government can be selective, accepting some amendments from the Senate, as it is doing in this so-called emergency session, and reject others when it chooses and, in doing so, say that the Senate is not exercising its constitutional prerogative.
The Prime Minister speaks about confrontation between the two Houses. There has been no confrontation between the House and the Senate at all as yet. There have been some very uncharacteristic remarks made in the House about the quality of individual Senators. Such remarks are ordinarily not allowed by the Chair in either Chamber. However, there is no confrontation at the moment. That is sheer hypocrisy. The Senate has exercised its constitutional prerogative to amend a Bill of the House of Commons and send it back here.
The Prime Minister had an opportunity to propose to the Premiers a curb on the Senate's power during his negotiations at Meech Lake. He had the opportunity two years ago to curb the powers of the Senate. 1 debated this issue with the then Minister of Justice on June 7, 1985. The Prime Minister did not proceed with that resolution and there was only one day of debate. We replied on that occasion that we were interested in real Senate reform which would go to the heart of the issue. We wanted an elected Senate to represent the regions of Canada and achieve a better equilibrium from our Confederation.
It is sheer hyprocrisy to suggest that there is confrontation and that a non-democratic House is abusing its role. It is the kind of silly, inflamed rhetoric we hear from the Prime Minister whenever he gets into trouble.
Consider the charade we went through during the last two days about what the Prime Minister wanted to do with the Senate. Yesterday, he was going to abolish it, reform it, elect it. Suddenly, he recognized that he made a deal with the Premiers and did not have that unilateral maneuverability any longer. He had to return to the Premiers to honour his commitment.
Today, I asked him if he will honour that commitment to the Premiers to allow them to appoint, honour his commitment to the House to abolish the Senate, or honour his commitment to the regions of Canada to propose an elected Senate? There is sheer confusion and sheer hypocrisy.
When the Prime Minister proposed that phoney abolition offer two years ago, at that time the provinces had to approve it seven out of ten, with 50 per cent of the population. I knew that and thought it was absolute subterfuge and an absolutely cynical, hollow offer.
When the Prime Minister, in his exasperation and phoney impatience, brought a resolution before the House of Commons, we debated it. We were ready to reform the Senate and adjust an equilibrium in our Confederation. The Prime
Minister did not address the issue, did not attend the House on that day and speak to the issue. The Minister of Justice and 1 each had a one-hour dialogue and that was the limit of the Government's effort to deal with the Senate.
It is a cheap attempt by the Prime Minister to take the focus off this disastrous Bill and to take some shots at the Liberal majority in the Senate. It is a bluff and a smoke-screen designed to draw attention away from this bad legislation.
The issue is not a constitutional one, certainly not yet. The issue is whether this Bill will raise drug prices for Canadians, whether it will really encourage research, or whether it is one of the great shams proposed by the Government against the consumers of Canada. The Prime Minister is as interested in talking about reform of the Senate in substance as he is about talking about the substance of this drug Bill, which is not at all.
When talking about the behaviour of Senators, the Prime Minister used very uncomplimentary language. Let us consider how all those Tory Senators responded when presented with these amendments and recommendations of the Committee in the Upper House. How did they demonstrate their leadership and exercise their role in acting for the Prime Minister and people of Canada on this important legislation? They abstained from voting. They ducked. They did not oppose, they did not propose, they did not vote for, they did not vote against. If I were allowed this language in the House of Commons I would say, "What a derogation of constitutional responsibilities".
Even the New Democratic Party, which advocates the abolition of the Senate, is willing to compromise that longstanding written constitutional position and its Party proposals and, in this case, cheer the Senate on on this particular issue. They agree with us about the merits of this Bill. This Bill simply raises drug prices for Canadians and increases profits for the multinational companies. I commend the NDP for having weighed their two conflicting beliefs against this Bill, against the Senate, coming out in favour of the best interests of all Canadians, which is to amend this Bill in the manner suggested by the Senate, and as suggested by our Party when it was before the House of Commons.
Our position is quite clear on the jurisdiction of the Upper House. We want an elected Senate. We want fundamental reform, but as long as the Senate remains a nominated Chamber, as long as it remains a non-elected Chamber, no matter who appoints them-giving the Premiers the powers of appointment is no significant reform-at the end of the day the elected House of Commons must prevail. That is a clear position of the Liberal Party.
But we have not reached that point, the end of the day. I would urge the Minister to look at a compromise, to look at these amendments once again and consider the arguments that have been made, the study made in the other place and the
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extensive debate here in the House. 1 urge him to weigh the interests and give intellectual property and patent rights adequate protection, whatever research and development that may bring, but at the same time achieve a balapce and equilibrium for the Canadian consumer, for the aged, the sick, the handicapped and for the four million Canadians who do not enjoy a drug plan, those people who really face the brunt of this legislation.
Why are the recommendations of Dr. Eastman and those of the Senate being rejected? It is for one simple reason. The American multinational drug companies do not like it. An earlier version of this Bill reflected the Eastman report. A summer elapsed and this new Bill was brought in which reflects further discussions with the Americans and the pharmaceutical companies south of the border. It was also brought in to accord the priorities of the American negotiators in the free-trade negotiations. American multinational drug companies are forcing the U.S. administration to make passage of Bill C-22 a condition of the trade talks. The Government has caved in to that pressure. It has been completely spineless. It has changed its original Bill to Bill C-22 in order to accommodate the American pharmaceutical companies and the American trade negotiators. I find it absolutely shameful that this Government and this Prime Minister are willing to sell out our poor, our sick and our disadvantaged just to improve the profit margins of the multinational drug companies.
The Minister says that even if prices go up, it does not really matter because they are all covered by provincial drug plans in any event. What a spurious and deceitful argument. What about the four million Canadians who are not covered by drug plans? What about the millions more who are only partially covered? What about them? "To hell with them", says the Minister. "To hell with Canadian taxpayers who are going to foot the bill to pay either directly for increased drug prices or indirectly through increased taxes to cover the increased cost of drug plans under provincial legislation".
This Government should hang its head in shame when the leading consumer protection advocate in the United States, Ralph Nader, feels obliged to speak across the border and tell the Canadian Government that what it is doing with this Bill will only hurt Canadian consumers and increase profits for the large multinationals. But the Minister and the Prime Minister have repeatedly denied that there is any connection between the trade talks and this legislation, even though the joint communique issued at the Shamrock Summit lists intellectual property as the one of the areas of discussion. Even though the United States trade representative, Clayton Yeutter, lists Canadian drug patent legislation as an irritant which, and I quote from the National Trade Estimate, 1986 report on Foreign Trade Barriers, Office of the United States Trade Representative, at pages 54-55, "costs U.S. pharmaceutical interests significant lost revenues each year".
It also states:
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The United States continues to raise its concerns at senior Government
levels. It urges speedy submission of modifying legislation to address serious
U.S. concerns about the inadequacy of Canadian patent protection in this
area.
That was right at the top of the list of irritant^ which the United States wanted to remove as a price fo]t free trade negotiations with the United States.
The President pf the United States in his letter to Senator Packwood, that great "Dear Bob" letter which we have often quoted in the House of Commons, dated May 8, 1986, said: "Dear Bob, thank you again for your forceful efforts in preserving our fast-track proposal for a Canada free trade agreement". Senator Packwood from the State of Oregon came along and voted for the fast-track but he had made a deal.
The last paragraph of the President's letter to the Senator reads: "We fully realize that lumber and other pending trade irritants must be resolved before we submit to the Senate the results of the comprehensive negotiations". Right at the top of that list of irritants is the pharmaceutical industry's demands for this legislation.
How clearer could it be? Yet the Minister and the Prime Minister say there is no connection. That is sheer nonsense. The Parliament of Canada is now in emergency session to meet Washington's timetable. This is the first time a legislature of a sovereign nation was every called into emergency session just to abide by and conform to the wishes of another nation.
The Government can deny it all it wants, but that is the truth, and what a shameful truth it is. Despite the attempts of the Government to hide the facts and cover up its real intentions, and to confuse Canadians on these trade talks, it is now becoming clearer every day that it has been the Government's intention all along to risk Canadian economic, political and cultural sovereignty in return for a free trade deal.
The Americans may be many things but they are not stupid. A Yankee trader is still a good Yankee trader. They know a good thing when they see one, and boy did they see a good thing when this Government got elected and the Prime Minister went down to New York. I am sure we all remember. He put on his black tie and told all those American bankers and investment brokers, "Hi guys. My name is Brian Mul-roney. I am Prime Minister of Canada and I want you to know that Canada is open for business again". The next day he returned to the House of Commons and I said to him, "That is terrific. We are open for business again. I never thought we were closed. We may be open for business again, Prime Minister, but this country is not up for sale", and that is what we are saying to the people of Canada.
Canadians know that the Government wants a free trade deal at any cost. The plan was simple, get the Prime Minister and the President together, put on the black tie, a few handshakes, a few songs, a few limericks, a nice meal, a nice show and that will keep those simple Canadians happy, especially

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the Prime Minister, who seems to be pretty easily impressed by anything that happens south of the border.
At the same time the U.S. dangled the carrot of a free trade deal in front of the Prime Minister. It put the heavy hitters to work behind closed doors to get everything it wanted before the deal was signed. It wanted to eliminate the National Energy Program, and what it considered to be the restrictive provisions of the Foreign Investment Review Act, before the deal was ever begun, before it was ever signed. The Americans know the Canadian Government is not going to put up much of a fight because apparently the Government of Canada needs the free trade deal. How will the Prime Minister of our country ever be able to explain to Canadians why he received so little and gave away so much?
The Americans could not believe their good fortune. Here was a Government which was willing to give away all of its best bargaining chips, FIRA, the National Energy Program, even before the negotiations started. The Government has been willing during the course of these negotiations to sell out industry after industry. First it was our lumber industry, then our book and publishing industry and now it is the turn of the drug industry at the expense of the Canadian consumer.
On March 16 I asked in the House what would be next on the Tory sovereignty sell-out; oil and gas, steel, or potash? Potash is the next industry on the block. The preliminary decision of the United States to impose an 85 per cent countervailing duty on Canadian potash is the latest pressure tactic. That measure could wipe out the Saskatchewan industry. It could prevent Manitoba from getting in the game. It could wipe out the development in New Brunswick.
We expect the same "fearless" performance, to use the word of the Minister for International Trade (Miss Carney), whose great victory was to impose a 15 per cent export duty on our lumber industry at the request of the Americans, despite the fact that in 1983 we had won an identical case. Despite the fact that the underlying premises and facts had not changed, the Government of Canada lost its nerve and surrendered. It pleaded guilty before the trial and withdrew our case. The only difference between now and 1983 is that in 1983 we did not have a weak Government that was preoccupied with preserving a free trade deal at any cost.
I would advise the Canadian potash industry to be very wary of offers of help from the Minister for International Trade.
This Bill as proposed by the Government is bad legislation. It does not do what the Government states it will do in terms of research and development. It does not create more jobs. It does not give Canadians a new and larger variety of drugs. It only raises prices, and increases the profits of the multinationals.
Obviously the Government hopes that in the flurry of publicity that it has created by the incompetent handling of the refugee issue, Canadians will not notice that the real motive for recalling Parliament for this emergency session is to
pass this drug Bill. It is a cynical act by a desperate Government caving into the sovereign extraterritorial power of the United States.
I urge upon the House and the Minister a full consideration of the amendments that we proposed in the House, and the amendments proposed by the Senate and returned to us for reconsideration. These amendments would give a fair balance between research, jobs, and development on the one hand, and yet preserve stability in the drug price structure for the benefit of those Canadians least able to protect themselves; the aged, the chronically ill, the sick, the handicapped, those who cannot protect themselves and who depend upon Parliament to step up and call upon the Minister one last time before the end of the day to listen to reason and common sense, listen to the facts and the arguments, and be reasonable and accept our amendments.
Some Hon. Members; Hear, hear!


Hon. Michel Cote (Minister of Regional Industrial Expansion and Minister of State for Science and Technology):: Madam Speaker, I, too, am very pleased to be able to make a few comments on this excellent Bill C-22.
A moment ago the Leader of the Official Opposition (Mr. Turner) referred to the few years' experience he had in the Department of Consumer and Corporate Affairs, of which he may have been the first Minister.
I, too, had this experience, Madam Speaker, and the opportunity to study in detail first the effects of the Liberal Party position on that project or the measures that date back to 1969, and particularly the Eastman project which was announced and launched in 1983. Madam Speaker, the Eastman Committee was set up precisely because the Party recognized that changes were needed. Changes were necessary because the evidence showed at the time that the existing legislation substantially reduced the number of jobs, and moreover, that it was causing a major outflow of the investments related to the pharmaceutical industry to other countries. Naturally, we all remember the most recent decision of this industry in Quebec when the Hoffmann-LaRoche company had to close down because of the inaction of the previous Government.
This is why it is important to make some changes. This is why we have introduced Bill C-22. First, because we firmly believe in the principle of protecting intellectual property. We believe that the time has come to align our patent rights on international practice, as patents are recognized throughout the world in all industrialized countries. To my knowledge, Canada is now virtually the only industrialized country where a company cannot always obtain patent rights for new drugs under the compulsory licencing system. To a certain extent, Canada is the only country where drug prices are controlled through intellectual property, and I believe that this must change.
August 26, 1987

If all countries had legislation as regressive as ours, no new drugs would ever be developed. Bill C-22 will bring back patent protection to a seven to ten year period, as we have already pointed out, and transform the Canadian pharmaceutical sector into a first-rate innovative industry, which will generate an important increase in investments and jobs in the area of research and development.
As it is, Madam Speaker, the Senate is not prepared to extend that kind of protection to our multinationals; naturally, they stand accused of making profits at the expense of consumers. But here is another point of view as expressed by columnist Lysiane Gagnon in the August 22 issue of La Presse, and I quote: "The major drug research laboratories are multinational companies. Why? Because applied research is very costly, of course. On average, they spend SI00 million over 10 years to develop and market a new drug, not to mention the time they waste working on risky ventures. No wonder there are no small- and medium-sized businesses or cooperatives in state-of-the-art research."
Well, Madam Speaker, our Senators would be quite satisfied with maintaining the status quo by granting drug manufacturers a four-year protection. The rationale underlying these amendments to the Patent Act is the creation of a climate likely to promote research and development in the drug industry. Indeed, as I said a moment ago, we want to stem the brain exodus towards foreign lands. Thousands of students, young researchers, and scientists are leaving Canada precisely because they cannot find jobs here and have much more challenging opportunities elsewhere.
1 also referred to the massive inflow of capital investments we can expect once Bill C-22 becomes law. The Prime Minister (Mr. Mulroney) has been saying this everywhere: Canadians can look forward to investments in the order of $1.4 billion over a 10-year period, and this, I might add, in all regions of Canada, be it in Quebec, in Ontario where the main activities of the industry are located, or in the other provinces.
In 1995, research and development spending will total over $600 million annually. We must realize the impact this Bill will have on the future and health of Canadians. We must also remember that more than 30 per cent of the amounts to be spent on research and development will go to universities and research centres. The funds will also be used to coordinate our research and development efforts.
As I said earlier, every region in this country will benefit from the tremendous economic spin-offs. For instance, Nordic Laboratory in Montreal will receive $45 million. Universities and research centres in Edmonton and Calgary will receive $132 million. Hospitals and universities in Halifax and St. John's, Nefoundland, will receive $82 million. These are considerable amounts that will be distributed across our regions and benefit every Canadian who wants to dedicate his
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energies and efforts to this work, as well as our young people in the regions.
However, in the other place, the Senate is proposing a fund that would total no more than $25 million, which money would be redistributed to the companies, not to universities and research centres.
Bill C-22 also means creating 3,000 jobs for scientists, as I mentioned earlier, jobs for researchers, jobs for young men and women, for young Canadian graduates. Over 1,200 jobs will be located in the province of Quebec. The protection provided under Bill C-22 for new drugs will not only benefit research and development, it will also expand the volume of manufacturing and exports in the Canadian drug industry.
As for generic drugs, it is said that the Bill will mean the end of the generic companies. Madam Speaker, our new policy will promote the manufacture of new generic products by making it attractive for the generic firms to manufacture the chemical ingredients used in the manufacture of drugs.
All import licences already granted to generic companies will be automatically converted to manufacturing licences. Generic companies will thus be able to manufacture the product directly. It is also very important to remember that all generic products now on the market will continue to be sold. When people say that Bill C-22 will increase the price of drugs, they are simply trying to fool Canadians. The impact of this Bill will certainly not be to increase the price of drugs. Generic companies will also be able to continue and expand their exports. Generic products represent only 7 per cent of the drugs sold in this country. So what happens to the 93 per cent that are not protected and are free game? That is why we want to create a price review board so that we can reassess and monitor the prices of these drugs, for the benefit of the consumer.
Now, Madam Speaker, Canada takes up only 2 percent of the world medicinal drugs market. Well, by favoring new investments, we will rank among such nations as Japan, Italy, the United States in terms of research investments, innovations and new technology development.
Canada, therefore, will be recognized as a country which welcomes investments, not only in the pharmaceutical industry, but also in many others.
If I may, Madam Speaker, I should like to mention that during 1986, Canada has experienced, in terms of foreign investments, its best year ever. Foreign investments in the order $6.8 billion have resulted in the creation of new jobs and fostered new investments, due clearly to a favourable economic climate and the new confidence which has taken hold of Canadian citizens and businessmen.
Again, Bill C-22 follows this philosophy which our Party adopted in 1984.

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In the area of consumer protection, it should be emphasized that this policy, as I mentioned earlier, will continue to control the prices of drugs which are already sold in various drugstores, and to make sure that the future prices remain reasonable, there will be a fully independent Patent Medicine Prices Review Board which would be chaired by Dr. Eastman, the same man who carried out a study of the whole pharmaceutical industry. This organization will therefore be established.
Well, the Senate is against the creation of such a board and would rather entrust the control over the prices of these generic products to the free competition of the market-place.
Madam Speaker, that is not the way to protect Canadian consumers. As I said, 7 percent of patented medicine are subject to the competition of generic drugs. Canadians, therefore, have no way of knowing whether they are paying a fair price for the remaining 93 percent of these drugs when they are purchasing them.
So we are saying that the Patented Medicine Prices Review Board will review the price of all prescription drugs to provide that protection to consumers.
In formulating that policy, my Government has strived to reconcile the need to increase industrial research and development with the need to ensure the availability to Canadian people of pharmaceutical products at fair prices.
On the other hand, the report of the Senate committee means the status quo. Whatever means are used by the opposition and the Senate to present the matter in a misleading light, the only important thing for them is to obstruct the passage of the Bill.
I can also point out that in the press today, especially in the Toronto Star a non-elected Senator once again clearly mentioned-and this should not be accepted or tolerated by Canadians-that he will continue to object to any legislation which could be beneficial to the Prime Minister (Mr. Mul-roney). That is the kind of views put forward by our non-elected Liberal Senators in opposing a fair Bill. It is absolutely unacceptable.
When we put together the various elements of Bill C-22, we took research and development in consideration. Why? Because it is essential for Canada to redirect its future on the basis of the new technology taking research and development into account.
Job creation also is a major aspect. Three thousand jobs will therefore be created by this legislation by 1995. And, as I mentioned earlier, not only in Quebec or Ontario but in all Canadian regions. When we say that regions in this country are disadvantaged and that we must address those regional disparities, well, this is the result to be achieved by Bill C-22.
Let us also refer to investment. I referred to $1.4 billion's worth of investment. That kind of investment is important not
only because it creates jobs but because, in addition, fundamental research will put the ingredients in place to enable Canadians to occupy, as I said, a better place internationally.
Let us also refer to health care, Madam Speaker. It is clear this legislation recognizes the need to protect health care, but it also provides that in the future, there will be an increasing need to protect, to discover new drugs. And Canada must play its role as a nation. Bill C-22 ensures that.
Let us refer also to consumer protection. 1 referred to the review agency, Madam Speaker, which will go to industrialized nations, measure the effects of those prices, the impact on our prices, our Canadian pharmaceuticals, and will act where needed. There is a protection mechanism for consumers because when a new product is marketed, after four years the company would have to meet standards, criteria that are set up. And protection will continue to be extended if these criteria are met.
Therefore, Madam Speaker, such protection is consistent in all respects with the Government's commitment to ensure at all times not only that the consumer is adequately supplied with health care products but that these products are available at prices which are fair and comparable to those of any other country.
Finally, 1 believe that any forward thinking industrialized country must care about protecting its intellectual property. Not to do so would be inconceivable. Even the Liberals before 1983 had recognized the necessity of reviewing this obsolete and regressive legislation. Why was the Eastman Commission established? Why was it asked to review the pharmaceutical industry? Obviously because the legislation was deemed faulty, Madam Speaker. So now the Liberals are putting forward amendments which will bring us back to the same kind of legislation we have had since 1969. Surely, this is not the way to give our young Canadian men and women a reason to be optimistic and confident about their future.
It is precisely by addressing such important issues as intellectual property, patent protection and the safeguarding of inventions that we will give Canadians better protection and a brighter future.
Therefore, I must say once again how pleased I am to note that this legislation is agreeable to the National Assembly. Hon. Members will recall that the Quebec National Assembly has concurred in the Bill in an unanimous vote and has thereby clearly expressed its wishes. Those who vote in that legislature are elected representatives and we will neither allow nor tolerate that non-elected Senators oppose a Bill which meets the wishes of Quebecers and Canadians.


Ian Gardiner Waddell: Madam Speaker, 1 agree with the Minister that there are a number of issues before us, one of which is the
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non-elected Senate blocking the House. However, the other issue is the price of the drugs themselves.
I do not know if the Minister is familiar with one of the best articles that was written on this subject in Consumer Reports magazine. The article is talking about the United States and reads:
The brand-name companies dominate the $25-billion annual market in prescription drugs. They barrage legislators, doctors, pharmacists and consumers with an unrelenting message: Generic drugs are low in quality and may harm you.
Sounds exactly like parts of the Minister's speech. The article goes on:
Few distortions in the history of commercial propaganda hive cost consumers more money than that one.
The article goes on to point out that a brand name drug like Valium costs $27.47 per hundred whereas the generic drug, Diazepam, costs $8.49. The article lists example after example of this.
As a Conservative, is the Minister not in favour of competition? If he is, why is he trying to restrict competition with this Bill? Does he not agree that the people who will really be penalized are Canadian consumers who will have to pay more for drugs?


Michel Côté: It is becoming quite obvious, Madam Speaker, that the Hon. Member does not understand much about the contents of Bill C-22.
First, I would like to say that Bill C-22 is certainly not destroying competition. This is a balanced Bill, which protects intellectual property, and this is vitally important, as I have already said. How will this be done, Madam Speaker? By allowing the generic companies to continue manufacturing for export.
This means that the drug will still be there and that these companies will continue to develop as they have done in recent years. It usually takes from seven to ten years for a generic product to reach the market. We want to continue to allow generic companies to market equivalent products. Thanks to the control agency, if the price of a drug is too high or if the pharmaceutical companies do not meet the criteria set out in the legislation, they could lose their patent protection and a generic company could be invited to introduce its own product on the market.
It is a mistake to believe that drug prices will increase because of Bill C-22. People who believe that do not understand the Bill. There is nothing in this Bill that could remove generic products now on the market. Prescription drugs now sold in pharmacies will continue to be available to Canadians. This is what we have to realize and what the Hon. Member has failed to understand.
I therefore invite him to reflect further and to examine the situation more closely.


Mr. McCurdy:: Madam Speaker, the Minister indicated that not all generic drugs would be removed from the market. The fact is that the generic equivalent of Zantac will be removed from the market under this legislation because of the retroactive provisions of it. He says further that there will be no increased costs to patients as a result of this legislation.
How does the Minister explain that the Government has provided in this legislation for $100 million to compensate the provinces for the increased costs of drugs to taxpayers as well as consumers? When one considers the pattern of transfer pricing used by the multinational pharmaceutical manufacturers, how in the world is he going to guarantee that the initial cost of a new patent drug will not be as projected, that is twice the cost of a new drug, in the absence of generic competition?
During the course of his response to my colleague he also said it takes seven or eight years for a generic to be ready for the market. It has to go through a procedure of licensing and notices of compliance. That would mean, presumably, up to 17 years would go by before a generic could enter the market. Surely he understands that that kind of protection will unavoidably mean increased prices. In any event, if it takes seven or eight years for a generic drug to get on the market, as the Minister says, why in the world do we have this legislation, given that at the end of 10 years a new drug has to give way to its replacement?


Michel Côté: Madam Speaker, I would suggest that my colleague has already acknowledged the need for a new legislative measure designed to promote research and development. It has become ever more obvious that Canadians must be able to shop for products to protect themselves, the kind of products which will be marketed to protect their health. The Senate committee has come up with alternate proposals, including a royalty fund which will keep increasing precisely because these companies will be making much higher payments. Since the money will come from existing drug companies they will benefit from the economic fallout. This will not do anything to boost the investments which are also important to Canadians.
Now then, if the amendments proposed by the Senate were adopted, universities and research centres would also be deprived of most of the products which are available, not to mention the sum of nearly $400 million involved in the numerous research projects.
So this is just one more indication that our Bill meets the expectations of Canadians. The first thing to do is to consider what has been proposed in Bill C-22: equity provided under the Bill, lasting consumer protection, and promotion of generic products. What happened after the previous administration announced its intention to review the drug industry and set up the Eastman Commission? A sharp increase in licence

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applications, regardless of market conditions. As a result the generic companies are given a golden opportunity for expanded production. 1 repeat that the Bill provides for that kind of equity and, if I can put it this way, it will maintain the generic drug industry in a sector of activity which will leave it free to compete in the best interests of Canadians.


Mr. Neil Young (Beaches):: Thank you, Madam Speaker, for again giving me a further opportunity to enter this debate over what the Government is attempting to do to a policy which has been seen by most Canadians as both fair and good for Canada.
Before I begin my few remarks I want to say to the Minister and government Members that in my view and that of many in Canada there is absolutely no consensus in this country which would encourage the Government to do what it has been attempting to do for the last year and several months. In fact, if there is a consensus in Canada it is that the Government should leave what has been a good policy for Canada and Canadian consumers as is.
1 want to say at the outset that the Government has absolutely no one to blame but itself for the fix it finds itself in today as between this House and the Senate. I say that because of the way this whole issue has been handled by the Government from day one. The entire process has been questionable. In that respect I think it would be useful to remind ourselves how Canada's present policy came about. It did not come about by a fluke or accident or mistake. It came about because of some very good, sound and solid reasons.
We must look at what the multinational drug companies were charging Canadian consumers for pharmaceutical products prior to 1969. It has been said time and time again, and the Government refuses to recognize it, that prior to 1969 Canadians were paying among the highest prices in the world for pharmaceutical products. It was because of those unacceptably high prices, and many called it price gouging at the time, that the Government of the day was forced to respond to the concerns expressed. The first response was in 1961 when the Restrictive Trade Practices Commission examined Canada's policy on pharmaceutical products and the price gouging that was going on. It studied the matter, heard witnesses, and concluded that the reason was that the multinational corporations held a monopoly on drug pricing in Canada. That commission was the first to recommend that the Canadian Government end that monopoly by removing patent protection on pharmaceutical products. The Government of the day did not respond to those recommendations.
The pressure still existed so again in 1963 Mr. Justice Emmett Hall headed a royal commission into the pricing of drugs. He came to the same conclusion; the reason drug prices were so high was because the companies enjoyed a monopoly in the market-place. He recommended that patent protection be removed from pharmaceutical products in order to force prices down.
As things very often go with Governments, no action was taken on those recommendations, probably because of the tremendous pressure being placed upon the Government by the multinational corporations. However, in 1967 the Government finally asked an all-Party House of Commons committee headed by a Conservative Member named Harley to study this. That House of Commons committee concluded the same as had every other study group, that there was a monopoly practice in place in Canada which was detrimental to the interests of Canadian consumers. It recommended to the Government of the day that patent protection be removed for pharmaceutical products.
After all those studies, commissions, debates in the House and public pressure, in 1969 the Government of the day finally removed patent protection for pharmaceutical products. That ended the monopoly on pricing structures which those multinational corporations had enjoyed up to that time. Interestingly enough, it permitted Canadian manufacturers, the so-called generic drug manufacturers or, as the Government likes to call them, copiers of drugs or burglars or thieves or whatever, to get into the field, pay the multinationals a 4 per cent royalty for the use of their drugs, and force Canadian drug prices down from the highest in the world prior to 1969 to among the lowest in the world today.
The multinational corporations have never accepted that policy since 1969. For years they not only pressured the Canadian Governments of the day to revert to patent protection but also hauled the generic drug manufacturers into the courts and dragged them through lengthy litigations. This has been well documented. It is not something I dreamed up. In many cases they made it so costly for the generic drug manufacturers to defend themselves in the courts that they were hopeful that they would drive them into bankruptcy and out of business. That has been well documented and has never been denied by the multinational corporations.
It is interesting to note that of all the cases the multinational corporations had before the courts they did not win one. Not one case was won by the multinationals. It was out and out harassment of those Canadian companies, primarily by American producers, that caused those legal actions.
The pressure was still on then as it is today. In 1981, the Economic Council of Canada reviewed Canada's policies and concluded, 12 years after the policy was adopted, that it was a good policy for Canadian consumers. That is another independent committee which made that judgment and those recommendations.
Later on, in 1981, the Canadian Institute for Public Policy did a further study of the pharmaceutical industry and concluded that Canada's policy was the correct one. Not satisfied with that, an internal committee of the Department of Consumer and Corporate Affairs did its own study into
August 26, 1987

Canada's policy. That committee concluded that Canada's policy was a good one for Canadians.
As I said earlier, Madam Speaker, Governments being what they are, the Liberal Government of the day did not have the moral fortitude to tell the multinationals once and for all that the policy was good for Canadians and they should get lost. Instead it appointed Professor Harry Eastman to conduct yet another study into Canada's policy. We all know the results of that study. It is widely recognized, even by those who oppose his recommendations, that Professor Harry Eastman conducted the most intensive and thorough investigation into the pharmaceutical industry internationally.
After all of that, Professor Eastman tabled his report in the House of Commons, I believe in 1983. He concluded a number of things. For example, in 1983 alone, Canada's policy had saved Canadian consumers approximately $213 million on drug costs. He said that every previous commission recognized that a company should receive compensation for its efforts in developing a product. Those commissions concluded that the total cost to the pharmaceutical industry for research and development amounted to 4 per cent of total sales.
Therefore, Harry Eastman said, as previous commissions had, we should continue to pay the multinational companies 4 per cent royalties for all drugs copied by the generic drug manufacturers. He said as well that the approval process through the Department of National Health and Welfare to bring a new drug on the market was very cumbersome, and he made some recommendations on how that process could be speeded up. However, he said essentially that the policy should not be changed.
All of the studies since 1961 have recommended that Canada's policy should be as it is today. Therefore, why did the Government suddenly charge ahead, ignoring all these studies, the most recent one done in 1983, and introduce legislation through Bill C-22 which contains absolutely no reflection of the conclusions of all those studies?
One can conclude several things. The first conclusion is that it did so because of the tremendous pressure which was placed on Canada primarily by the multinational corporations based in the United States through President Reagan.
The Government denies that, but there is sufficient evidence available which clearly shows that that is the case. At the Shamrock Summit which took place in the Province of Quebec in 1985, President Reagan made that key demand as a prerequisite to agreeing to negotiations on a free trade package. That is the only reason we are faced with this legislation today. It is not to keep Canadian consumers happy but to satisfy a demand made by the President of the United States that a made-in-Canada policy for the benefit of Canadian consumers should be changed because he did not like it.
Regardless of the contents of this Bill, on that basis alone I would fight what the Government is trying to do. It is a direct
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attack on the sovereignty of this nation and its right to make its own policies on behalf of Canadians. I find that totally offensive and I think most other Canadians do as well.
The Government has made much of the fact that there will be a prices review board established and that prices will not increase. It is stating that we are simply trying to scare Canadians. That is the usual rhetoric we hear from Governments when their position is extremely weak. They try to attack those who oppose the Bill.
It was not only I or other members of the New Democratic Party who said that. Professor Harry Eastman said that it would be extremely difficult for a prices review board to determine whether or not a drug company is charging too high a price once this legislation is passed by the House. There are a number of reasons for that assertion. Professor Eastman said:
A major problem with the price indexes for a large number of commodity groups is the difficulty in accounting for changes in quality of products.
This is an especially troublesome problem for the pharmaceutical industry in which, each year, several new products are introduced in the market-place as fairly direct competitors with an existing array of products.
He says:
-the price index does not capture any increase in the price of the new product relative to the old product even in those frequently encountered situations in which the old and the new drug have roughly the same therapeutic value to the prospective patient and thereby are, for practical purposes, the same product.
Eastman said further that separating out changes in the quality of a given drug is so exceedingly difficult that it is rarely accomplished. As a consequence, drug price changes "may inappropriately register changes in quality".
After he examined the situation even further, he said:
What is clear-is that the changes of price of particular products are not at all a satisfactory indicator of expenditure changes that have as their source decisions by the manufacturer. In addition to deciding on the price of particular products, the manufacturer can also quite clearly decide to introduce a new product that is therapeutically little different from the old product and, furthermore, can set a price for the new product significantly higher than that of the old product.
In other words, it is a common practice within the industry that a pharmaceutical drug that is intended to do a certain thing is marketed, and once the market is saturated, they simply change the fine chemicals in that drug, give it a new name, charge a higher price and market it under a different name. The two products are exactly the same but the company can jack up the price for the fine chemical change in the old product.
Another practice of the companies was referred to by my colleague, the Member for Windsor-Walkerville (Mr. McCurdy), in a question to the Minister who spoke before me. It is referred to in some detail by a fellow named Stanley Adams in a book entitled Roche versus Adams. Stanley Adams was an employee in the pharmaceutical industry in the United Kingdom for many years. He was blackballed because

August 26, 1987
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he took on the pharmaceutical companies. I will not bore the House with the details because I am sure other Members of the New Democratic Party will want to speak on it.
In conclusion, I do not think the prices review board will work. Every provincial Government in this country with the exception of one, I believe, have said that prices will increase at great detriment to consumers if this Bill goes through.
Affordable drugs are an integral part of our health care system in this country. The issue is not one of copying a mouse trap, as the Minister calls it when referring to intellectual property. If the Bill goes through it will make drugs much more expensive and, in my view, will weaken the medicare system in this country. In many cases, people who rely on drugs in order to participate in the mainstream of Canadian society will no longer be able to afford them. I think that is a crying shame.


Howard Douglas McCurdy: Madam Speaker, I am sure my colleague heard the Hon. Minister for Regional Industrial Expansion (Mr. Cote) utterly fail to respond to the questions 1 posed to him following his rather confused presentation. I am pleased that my colleague addressed some of the questions I raised.
I would be very interested to hear what Mr. Adams said about the pricing policy of the pharmaceutical industry. I hope the Hon. Member will take as much time as is available to him to answer that question about just how the pharmaceutical companies, through pricing policies, contrive to rip off the consumers and provincial and private drug plans.


Mr. King:: What did Mr. Fingerhut say?


Neil Young: Madam Speaker, 1 am pleased my colleague asked that question. Adams said:
Transfer pricing had two advantages. It enabled the company to avoid a large amount of taxation, and it allowed them to overcharge without appearing to do so. It worked like this. If a Roche manufacturing company needed to buy raw material from the parent company in Basle to make the finished article, then the raw material was not, as you might think, provided at cost or cost plus a certain fixed level of profit. No. First Roche headquarters had to decide what the world market price of that product was, or in other words just how much they could sell it for and still be sure of having buyers. Then they had to look at the different levels of taxation in the various countries, and then they had to decide, bearing that in mind, just how much profit they wanted each individual company to show, if any.
Once they had made that decision, which obviously depended on how high or low the taxes on profit were, and on the political situation in any given country at the given time, then, and only then, Roche headquarters set the price the subsidiary had to pay them for the material they wanted.
That is one of the reasons, incidentally, that the federal Government has yanked a number of multinationals before the courts in Canada. It is because of the way they have been using the pricing policy to force Canadian taxpayers to subsidize them at the other end. Even the Government, which has come to be the hero and chief spokesperson for the multinationals, recognizes itself that there is something wrong with those pricing policies, mechanisms and structures. How it can do that on the one hand, and, on the other, say that it will have a prices review board that will be able to provide the
necessary protection for Canadians in what they pay for future drugs, is totally beyond me.
Even Professor Harry Eastman has concluded that it would be impossible for a prices review board to control price gouging because of all the various factors involved.


Ian Gardiner Waddell: Madam Speaker, 1 want to ask the Hon. Member a question, but I heard a Conservative Member yell: "What did Fingerhut say"? Mr. Fingerhut is an American pollster.
1 do not know what he said but I know what Angus Reid and Gallup said. Fifty-eight per cent of the Canadian public said that they opposed the Bill, 32 per cent agreed with it and 11 per cent were undecided. I imagine Mr. Fingerhut found the same thing, that the Canadian public opposes this Bill because it is a cave-in-


Mr. Fennell:: Not in my riding.


Ian Gardiner Waddell: You are caving in to the American multinationals. You are letting the American multinationals and the American President push you around. You are increasing costs for Canadians.


The Acting Speaker (Mrs. Champagne):: Order.


Ian Gardiner Waddell: You are ripping off the old people and showing absolutely no guts in the face of this presidential-


The Acting Speaker (Mrs. Champagne):: Order.


Ian Gardiner Waddell: I have a question, Madam Speaker.


The Acting Speaker (Mrs. Champagne):: I am sure the Hon. Member knows that he should address his colleagues through the Chair.


Ian Gardiner Waddell: Yes, Madam Speaker, I will.


The Acting Speaker (Mrs. Champagne):: I am sure also that his colleague has heard the question and may want to answer.


Ian Gardiner Waddell: Could I put the question? I did not have a chance to put it.


The Acting Speaker (Mrs. Champagne):: 1 thought there were quite a few questions in fact in the statement made by the Hon. Member for Vancouver-Kingsway (Mr. Waddell). However, I will allow a very short question after a long comment.


Ian Gardiner Waddell: Thank you, Madam Speaker. The question is simply this; the Hon. Member used to be the health critic of our Party and was very active in the debate on the indexing of pensions. He dealt with some of the older people in the country through that debate. He has expressed concerns that the medicare system would be affected. I wonder if he could tell us, through you, Madam Speaker, given that our population is
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aging, what kind of effect this will have on the future of our health care system with an aging population?


Neil Young: Madam Speaker, that is one of the real concerns in this legislation. The Minister himself has pointed out that most Canadians should not be too concerned because they are covered by provincial health care plans, insurance plans or a number of other insurance schemes. However, I want to point out that provincial Governments which have looked at this legislation have concluded that the increased costs to their treasuries will be such that they may have to take a look at whether they can continue to carry these programs. That is a source of real concern for many senior citizens.
Provincial Governments get money in just the same way as the federal Government, from taxpayers. They are going to have to take a look at whether they can continue to carry these programs, and if they cannot, they will have to increase provincial taxes in order to continue paying for them. If they do not want to go that route, they are going to have to take a look at whether they are going to place a deductible on drug care programs. They are going to have to find some way of surcharging seniors who presently have free drug coverage. It will have to be the same for people who are on some kind of income-support system. Disabled persons very often receive some kind of assistance from provincial Governments.
Will the provincial Governments be able to continue to provide that coverage if it becomes so expensive under these legislative changes? That is a source of great concern for many people.


Ian Gardiner Waddell: Madam
Speaker, I rise to speak on this matter. Normally we would hear next from a Conservative or a Liberal, but they do not seem to want to speak on this particular Bill.


Thomas Scott Fennell: We said it all to the people out front earlier.


Ian Gardiner Waddell: This is a government motion to reject Senate amendments. I think the position of the New Democratic Party is quite clear. We have always opposed Bill C-22. We favour the existing system of compulsory licensing of generic drugs. We think this is a bad Bill. We thought so at the time the Bill was passed by the House. We believe it means increased drug prices. The Hon. Member for Beaches (Mr. Young) mentioned the figure from the Eastman report of $213 million in one year. We think there is a tremendous lobby out there of multinational companies which have put great pressure upon this Government. We regret the Government has caved in to this lobby. We know this is what is called a "trade irritant" to the United States, that is, President Reagan and the Americans have taken the side of the American companies, and the Government has caved in again to the United States on this matter, as it has caved in on most matters dealing with the United States. For all those reasons we have opposed Bill C-22.
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The Senate has blocked the Bill. We do not believe in an appointed Senate and, therefore, we believe the Senate should let the Bill pass after the House of Commons has in fact reviewed the matter. However, I think this process is working as a sober second thought. We feel that the Government should listen to the arguments from the other side and to the Canadian people, who I do not believe support this Bill. In fact, 1 will go further. I believe this is probably the worst Bill brought in by the present Government. It is a Bill which turns back the clock. The Hon. Member for Beaches gave the history of the great struggle of this Parliament to break free from the drug lobby and to bring in legislation in 1969 which took Canadians from a people who paid the highest prices for drugs to a people paying some of the lowest prices for drugs. Why are we trying to change that? It seems to me that it is a terrible mistake.
I do not understand the position of the Liberal Party with respect to this Bill. I believe the Party is split on the Bill. I know that Judy Erola, who used to be a Minister for the Liberal Government, has now taken a job as head of the drug lobby group. I see that as very unfortunate. I see a split between the Liberal Senate and the Liberal parliamentarians which may have something to do with the leadership question. Be that as it may, I ask the Government to take another look at this particular Bill.
What do the Senate amendments do? First, they basically accept the Eastman report, which is the report of Professor Harry Eastman of the University of Toronto in 1985. The first recommendation is that the exclusivity period of seven, eight and 10 years granted by Bill C-22 be now cut to a flat four years. In other words, there would not be this long period of exclusive patents. I think it is rather ironic that the Conservatives, who are supposedly in favour of competition, do not realize that granting eight, nine or 10 years exclusivity, is another way of granting a monopoly. What we are in fact doing is granting monopolies through the process of this so-called patent protection.
The second recommendation of the Senate is that any retroactivity in the Bill to June 27, 1986, must be cut out. The Hon. Member for Windsor-Walkerville (Mr. McCurdy) pointed out that by putting retroactivity in this Bill, it will in fact mean that some generic drugs will have to be removed from the market.


Robert Nesbitt Horner: Wrong.


Ian Gardiner Waddell: The third recommendation is that the drug prices review board be eliminated on the grounds that in any event the board will not have much effect on the price of drugs.


Robert Nesbitt Horner: No generic drugs will be removed.


Ian Gardiner Waddell: With respect to the price of drugs, a subcommittee of the United States Congress, chaired by Congressman Waxman, summarized its findings, and I quote:

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m U700)
Most of the money generated by the recent enormous price increases-
Drug prices have been increasing at approximately 12 per cent per year in the United States.
-is not going to fund research and development. Between the years 1982 and 1986, drug price increases produced revenue gains of $4.7 billion. During the same period, research and development expenditures rose only $1.6 billion-or about a third of the revenue gains from price increases.
Congressman Waxman also states:
In short, the money was arriving in bucketloads, but was going to research and development in spoonfuls.
That is the record of the drug companies that purport to lobby and propose so much to the Canadian Government.
Fortunately, the Senate has stated that a pharmaceutical royalty fund should be created. This will pay patent holders a royalty of 14 per cent based on 4 per cent for promotion costs, and a second portion set originally at 10 per cent but varying in the ratio of world research and development undertaken by the multinationals, and the development expenditures to world sales of prescription drugs. Again, this is a proposal to set up a fund that would try to make good the promises of research and development.
The first three of these proposals are clearly supportable. There is considerable argument in the generic industry whether a 14 per cent charge recommended by Eastman is justifiable. Generic manufacturers point out that they must do their own R and D to meet Health Protection Branch regulations. They think a higher than 4 per cent figure could be justifiable, but no one has proved it to them yet. This is their position. The 4 per cent figure was set by the Commissioner of Patents on the first compulsory licence, and has not been varied since.
The Senate struggled with implementing particular amendments, after having had the full process of travelling across the country and in an unhurried fashion listening to witnesses.
If this were a wise Government, it would take a second look at the Bill and implement some of those proposals. It would receive some popularity in the country.
The conclusion must be that the Senate version of Bill C-22 is a better one than the one presented to the House. It allows the compulsory licensing system to work with far fewer impediments than the Government's Bill, and it presents a method of specific reward for companies based on actual research and development work undertaken. The Government's Bill simply offers the drug companies a massive blank cheque in the form of 10 years of exclusivity, whether or not they do the research and development. It has no sanctions for ensuring that the research and development investments are made. Therefore, that is why we oppose the Government's Bill, and would urge the Government to adopt some of the Senate amendments.
I wish to deal with the matter of research for a few minutes, because we keep hearing about all the research that is going on. The Senate version restores the emphasis on lower prices that the Government has sacrificed. It sought to make some guarantees that higher royalty payments to the brand name companies would actually result in research and development. It is interesting to note where the research is carried out. As I understand it, the real research in drug development is done in the home country of the large multinational drug companies, for example, in the United States or in Europe. The research that we get in Canada is limited research. It is market and clinical research, but it is not the type of deep research that the Government states it could be. There is much authority for that view. Many articles have been written.
A group called the Medical Reform Group of Ontario advised the House of Commons committee that it takes 200 to 300 people working at the same location to create a good centre for basic research, and that none of the pharmaceutical companies now operating in Canada has anywhere near that capacity. Therefore, there is not the capacity, plus it is not natural for them to do it in Canada. It is done at the home base of the multinational corporations.
The Minister stated in the House that $900 million would be invested. This is what one would call a form of boosterism and blackmail in order to have the House rush through with this Bill. I do not believe the argument on research.
The argument on jobs is an interesting one. The bait is that there will be 3,000 high-tech jobs for graduates. The Minister should look at the analysis of his own Department; it contradicts the Minister. Documents obtained by Southam News under the Access to Information Act illustrated that out of the magic number of 3,000, only 1,148 will be employed by the industry in a professional category. According to the documents, a further 541 will be employed extramurally, probably in universities and research institutes. A further 652 are classified as technical, which means lab technicians who could have an undergraduate or community college standing. There are 620 others who turn out to be, in the words of the Department of Consumer and Corporate Affairs, "Managers, cleaners, animal keepers, statisticians, and clerks". Therefore, the 3,000 high-tech, high quality jobs for Canadian scientists and biochemists over the next 10 years are not there. The companies plan to employ 1,148 professionals, or 38 per cent of what they have led people to believe.
One has to ask, what is the Government's real agenda? I think that the Government's real agenda is to make the United States happy and to remove this so-called trade irritant because that was part of the free trade deal. I listened to the question addressed to the Prime Minister (Mr. Mulroney) in the House, and he virtually has admitted as much. That is the Government's real agenda. It has an unpopular Bill. There are a small amount of people who are employed in the industry who naturally are in favour of the Bill. The public is not. Why would the public be in favour of a $400 million or $500 million increase in drug prices? Why would we go from some of the
August 26, 1987

lowest prices in the world to some of the highest? The Government does not have much support.
I wish to conclude by bringing a couple of matters to your attention, Madam Speaker. I wish to read a letter that I have received from one of my constituents, a Mrs. G. Rowlands, who lives on Fleming Street in my riding. She states:
I am a widow in my late fifties. I live on less than $450 a month. Fortunately, I am in good health, but my husband's drug bills for the past nine years were on an average of $150 to $200 a month, using generic drugs. If he had not been covered by pharmacare on D.V.A, we would have had a very hard time indeed.
I know people, however, who are under 65 and pay for their own drugs, as 1 do. Can you imagine the difficulty in covering these escalated costs on a limited budget?
That is what the real world is like. People are struggling to pay this type of drug Bill. We have an aging population, which means that we will have to pay more. The Government comes along with a Bill which will not increase jobs. We will have research that is clinical and market oriented, and not basic research. There is much authority for that position. There have been many hearings and many quotes. The jobs will not be created. Prices are rising. It is a pay-off to the Americans. In short, it is one of the worst Bills that this Government has brought in, and the Canadian people will hold the Government accountable at the next election.


Robert Nesbitt Horner: I listened attentively to the Hon. Member who made a great number of points which were full of holes. The Hon. Member talked about jobs not being there. We know that these jobs are there. Let us review what has happened with this Bill. It was introduced and went through first reading, second reading and into a lengthy study by a legislative committee. The study went on and on and on. I sat in on the hearings and I know what the committee went through. The Bill was given third reading and sent to the Senate for Royal Assent.
What did the Senate do? It decided that it would study the matter and then sent it back to the House. Senators changed the Bill around. They said that we could not have 10 years' exclusivity. They said that we had to go back to four years but give a 14 per cent royalty and so on and so forth. That is all history. However, the truth is now coming out. The truth is now coming out with respect to what the real reasons are behind that move.
Today, in an article in The Toronto Star, the Deputy Leader of the Liberal Party in the Senate, Senator Gigantes is quoted as having stated, "I will do anything that I possibly can to stop a Bill that makes Brian Mulroney look good". I think that is a very poor reason for trying to stop a Bill that will bring about research and medical technology. I agree with the Hon. Member when he says that the parent companies-


John Napier Turner: Fill the Senate full of concrete.
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Robert Nesbitt Horner: 1 agree with the Hon. Member when he says that the basic research is done in the parent companies. Ciba-Geigy has an office in my riding of Mississauga North. That company's basic research is done in Basel, Switzerland, where its head office is located. The company has 1,000 researchers there. Would it not be very nice if some of that operation were decentralized and carried out in Canada?
I do not expect that large research facilities will be built in Canada right away, but the pharmaceutical companies-and we have to show some trust in them-have pledged $1.4 billion over the next five years. That will produce 3,500 jobs in research for university trained people. I really cannot see how the Hon. Member can state that we will not produce these jobs.
Hon. Members will remember that back in 1984 the Prime Minister (Mr. Mulroney) stated that we would create jobs at a faster rate than they had ever been created before. Members of the Opposition said that that was false, that we would lose 150,000 jobs. However, the latest reports state that we have created jobs at a rate of over 25,000 per month and, lately, as high as 40,000 per month.


Bill Rompkey: In Ontario!


Robert Nesbitt Horner: The Hon. Member says, "In Ontario". I will grant the Hon. Member that Ontario has prospered and is prospering. I will also tell Hon. Members that the spin-offs are coming now in other areas. We are doing things in eastern Canada and in western Canada that have never been done before. How can the Hon. Member stand up and say that this is a bad Bill when there are 2,500 people walking on Parliament Hill today? I am sure he has never, ever seen 2,500 people walk in support of a government Bill in the time that he has been here, and I believe he was elected in 1979. He has never, ever seen 2,500 people walking in support of a government Bill. The CBC will report that when 150 people protest against a government Bill it is a massive display. So what will happen now? We get 2,500 people in support of a government Bill and the CBC reports about finding a box on the bottom of the ocean-absolutely ridiculous!
I would like to ask the Hon. Member to comment on his statement that the cost of drugs will go up and about the aging population. I will grant the Hon. Member that we have an aging population. But with an aging population we must have the research to supply the medical technology to look after such a population. How will we have research to do this if we do not have a Bill that gives some protection and some exclusivity to the companies that are doing the research? I would like to hear the Hon. Member's comments on that matter, Madam Speaker.


Ian Gardiner Waddell: Madam Speaker, I thank the Hon. Member for his question. With respect to the people who are demonstrating outside, I am glad they are. They are exercising their constitutional rights to demonstrate. I point out that I understand that they work for the companies and are paid by

August 26, 1987
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the companies. Their expenses here were paid by the companies. So one has to take those matters into consideration. Inevitably, one has to balance the fact that some people will lose in some instances, such as a group of people, versus another huge group of people, namely the people who have to pay the increased drug prices, especially older people.
With respect to research and development, it is not only I who say that. Dr. Paul Gorecki of the Economic Council of Canada, who is perhaps the leading economist in the field of prescription drugs, expressed to the committee his scepticism about the projected doubling of research and development by 1990. He said that no data has been provided in this respect. He asked how real these assumptions are. Under what assumptions is the growth in R and D likely to occur, he asked. He also asked the following questions. Which companies will increase their R and D? Will the research be clinical or basic? Will market research be included?
1 have not been saying that; it is being said by the expert in the field. With respect to the costs, the figures are there. They were presented to the committee and before the Senate committee and so on. They range from $300 million to $600 million in increased prices.
The Hon. Member and I both share the notion that we would like to see research in Mississauga, or anywhere else in Canada. Would it not be nice if some of the research that is now being conducted in Basle were to be conducted in Canada?
I think that the Hon. Member is being naive when he says that we have to show some trust in these companies. This is a huge lobby group. It has never kept its promises in the past. If we look at what the American committees have found out and at who is leading this movement as well as what is happening, I think Hon. Members will agree that the Government of the Prime Minister and the Hon. Member are naive in the extreme to get suckered into changing Canada's drug laws as a result of the pressure of the relatively small numbers involved in this lobby group.


Mr. Orlikow:: Madam Speaker, I would like to direct a question to my hon. friend. I know that he did a tremendous amount of work on the whole question of the energy industry and how the oil companies shifted oil and increased prices by moving oil from one subsidiary to the other. I ask the Hon. Member if the report which I am about to read which appeared last week in The Globe and Mail sounds familiar to him. The article states that these companies, these great multinational companies whose profits are among the highest of any company in Canada, are involved in a system of transfer pricing. The article states:
Transfer pricing is a way of shifting money within related companies to move profits out of high-tax areas into more favourable jurisdictions. In a typical transaction, the Canadian subsidiary would pay an offshore affiliate an inflated price for the raw material used to make a prescription drug. This overhigh price becomes a cost to the domestic company, cutting its profit and therefore its tax bill.
The article then goes on to list a number of cases in which Revenue Canada has battled with companies. In one case one of the companies settled its dispute with Revenue Canada by paying $500,000 in lieu of taxes which it should have paid if it had not become involved in this very cute deal of intercompany transfers. Does that not sound very much like what the oil companies have done so successfully in rooking and bilking the Canadian people?


The Acting Speaker (Mrs. Champagne):: May we please have a short answer from the Hon. Member.


Ian Gardiner Waddell: Madam Speaker, the Hon. Member is absolutely right. There are parallels between the working of the multinational oil companies and some of the multinational drug manufacturers. We are not saying that they are bad people. But they work in a different interest. They work for the interest of their shareholders, which they should, in their own particular countries. But that does not happen to be in the interests of Canada, at least not all the time.
So we have had a history in Canada in which there have been higher than normal oil prices. We have had some restrictions in terms of competition. We have had research and development transferred to the United States. We decided as a people in the 1970s to try to Canadianize our industries, to try to get some control over industries in Canada. Now the Government is reversing that whole trend, not only in the oil industry but also in the drug industry.


Hon. Charles Mayer (Minister of State (Canadian Wheat Board)):: Madam Speaker, debate on this Bill began last Friday. Today is the fourth day of debate. I think everyone would have to agree that it has been well discussed in the House. Outside the House, people have come to the front lawn of Parliament in the last two days to make the point that they would like to see the Bill passed.
One of the things that caught my eye about the demonstration was the signs some demonstrators were holding which said: "Copycats cost jobs". I think there is good evidence that this Bill will create jobs in Canada and will do the exact opposite of what the Hon. Member who just spoke said it would do. The Bill will create more jobs for Canadians, and that tells me that it will help Canadianize the industry.
The Bill has been before Parliament for 15 months. It has been discussed at length in committee. It has had 90 hours of debate in the House. Surely it is time the House took a decision.
I therefore give notice that at the next sitting of the House, immediately before the Order of the Day is called for resuming debate on the motion of the Minister of Consumer and Corporate Affairs (Mr. Andre) in relation to amendments made by the Senate to Bill C-22, an Act to amend the Patent Act, and on any amendments proposed thereto, I will move that the debate be not further adjourned.
August 26, 1987


Ian Gardiner Waddell: Madam Speaker, does the Government not have any shame? The Minister is applying closure on the Bill. He is putting down the guillotine. What is the Government afraid of? Why is it afraid of letting the House of Commons and the public debate this matter? Why does the Government have to use its heavy hand?
Does this have anything to do with the trade negotiations with the United States? The Government is getting down on its knees genuflecting to the Americans.


David Orlikow: Not its knees, its belly.


Ian Gardiner Waddell: Yeah, it gets right down on its belly. Does this not have something to do with the fact that this has to be put through for the American trade negotiations? Why is the Government making Canadians, and particularly old people like the lady whose letter I read in the House, pay higher prices? Harry Eastman and all the commentators said that the prices of drugs will go up, and the Minister should not deny that.
What is the real reason for this move? Is it because the Americans want the Bill? Why is the Government bringing in closure when there is absolutely no reason to do so?
The heavy hand of closure indicates a Government that is scared of Canadian public opinion and Canadian public opinion opposes this Bill. Canadians may not like what the Senate is doing, but separating the issues, they oppose this Bill because it means higher prices to be paid by Canadian people and it will not mean the kind of jobs that have been promised.


Charles James Mayer: Madam Speaker, the Hon. Member made several interesting allegations. He wants to know what the Government is afraid of. The Government is not afraid of anything. Above all, the Government is not afraid to act on something that has been well discussed and whose benefits to Canadians have been well documented.
The Hon. Member should also know that the Bill will provide $ 121-million worth of investment in his own province. Surely that is something about which he should be concerned.
We must all be concerned about some of the illnesses that beset all of us as we get older. One of the things these amendments to the Patent Act will do is to find cures for some of those illnesses.
These amendments will give Canadians a chance to work in their own country and in their own chosen field. They will give Canadians a chance to be creative and productive in their own country. Surely that shows a Government that is not afraid but a Government that has taken responsibility and has acted.


Mr. Guilbault (Saint-Jacques):: Madam Speaker, I would like to ask a question of the Minister who just moved closure on this piece of legislation.


Philip Derek Lewis: He gave notice.
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Jacques Guilbault: Yes, he gave notice, notice of a clear intention of the Government.
Day after day, the Government has accused the Liberal Party of being anti-democratic, of frustrating the will of an elected Government, simply because the Senate studied the legislation, as it should, and returned amendments to the House, as has been done time after time and as was done just last week on the transportation Bills, Bills C-18 and 19, in which case the Government approved them. Now the fact that our Party, through its Senate wing, is doing its jobs is called anti-democratic.
How can notice of closure be called democratic, especially at a time when the debate was winding down and it is obvious to everyone that this Bill will pass? Is that a democratic move by a Government that is accusing the Opposition of being antidemocratic? Let the Minister clarify what is democratic and what is not.


Charles James Mayer: Madam Speaker, there have already been four days of debate on this Bill as it has been returned from the Senate. There were over 90 hours of debate in the House before it went to the Senate. There were extensive committee hearings on the Bill. There has been wide public discussion of the issue. Surely the Hon. Member is not suggesting that, considering all those things, what has happened is undemocratic in the sense that the people have not had a chance to make their views known. Any kind of common sense would tell the Hon. Member that, with the kind of exposure that has been given the Bill in the House, in committee and in the Senate, it is time for the House of Commons finally to make a decision on this very important matter.
In view of the amount of debate there has already been, I do not agree with the Hon. Member at all that this is undemocratic. We are doing what Canadians want us to do. We are exercising the responsibility that was given to us in the last election and, on that basis, the Government is not afraid of anything and above all is not afraid of acting on this Bill. That is exactly what we are doing.


David Orlikow: Madam Speaker, 1 am sure the Minister's friend, Jack Penner, the President of Keystone Agriculture in Manitoba, an organization which has expressed its opposition to this Bill, will be interested in the comments of the Minister.
What is the difference between members of the Opposition refusing to go along with the views expressed by the people who are demonstrating outside-and they have every right to demonstrate-and the refusal of the Government and the Minister of National Health and Welfare (Mr. Epp) to back down on the banning of advertising for tobacco? Members of Parliament from every Party have been receiving letters from people who work for tobacco companies and their advertising companies, but the Minister, quite properly, and virtually all members of the Opposition, agree with that Bill and are rejecting those representations made by those people who, for

August 26, 1987
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obvious reasons, are concerned about the Bill which will affect their economic security.


Robert Nesbitt Horner: We're talking about Bill C-22.


David Orlikow: I am talking about the Bill the Minister of National Health and Welfare has brought in to ban tobacco advertising. I am saying that the people who oppose that Bill for reasons which they understand and which we can understand, have had their representations rejected by the Minister and the Government, as they should be. 1 say we are giving precisely the same consideration to the representations being made by the people who were demonstrating outside and we believe even if they are adversely affected, which we do not believe they are, the welfare of the people of Canada as a whole would be protected by not passing the Bill. 1 ask the Minister: What is the difference?
[DOT]	(1730)


Charles James Mayer: Madam Speaker, 1 listened to the Hon. Member with a fair amount of care. We both represent ridings in Manitoba and I have a chance to travel with the Hon. Member a fair amount and have a high regard for him. I fail to see, however, the connection he makes between Bill C-51, which 1 think he is referring to, and the Bill presently before the House, Bill C-22. 1 guess you could make that kind of connection between any Bill, but I fail to see what it has to do with C-22. I guess if I wanted to be facetious I could ask what the Hon. Member has been smoking. 1 do that with a fair amount of affection and not to be discourteous. I do not honestly see the connection between that and his comments regarding the President of Keystone. 1 have had conversations with him and other members of that organization on their position concerning Bill C-22. We well know each other's views.


David Orlikow: And they are different.


The Acting Speaker (Mrs. Champagne):: Resuming debate.
[DOT]	(1740)


Jacques Guilbault: Madam Speaker, to clarify the situation, 1 would like to say first of all that when the Minister answered my question a few moments ago, he stressed the time we had spent in debate on Bill C-22. I must say I agree with him on that score. The debate has been a long one. The Opposition, which is truly opposed to this Bill and wants to amend and improve it, spoke for quite some time.
However, that is no excuse for the Government to impose closure, to put a gag on the debate as it is doing now. What the Minister did not say, and I intend to do so now, is that we had given some very clear indications to the Government's representatives. The Minister should listen to what I am saying because this is something he ought to know. We gave very clear indications that we did not intend to make the debate go on much longer. We told the Government House Leader earlier today that when our Leader, the Right Hon. Leader of
the Opposition (Mr. Turner), took the floor this afternoon he would be the last speaker on our side.
That being the case, why is the Government bringing in the steamroller, in the form of the most odious measure in our Standing Orders? The Government could have had the grace to wait until the end of the day and it would probably have had its Bill. Madam Speaker, I must admit this is hardly conducive to harmonious relations between the House Leaders of the various Parties.
The Parliamentary Secretary who is responsible for the business of the House seemed quite relieved when we told him that our Leader would be the last to speak. Maybe he didn't mention this to the Minister responsible for the Canadian Wheat Board who was asked to do the dirty work, to put the gag on this debate.
The Government could have proceeded otherwise. It could have used another section in our Standing Orders which provides for time allocation. No! In fact, I think the Government is showing his lack of confidence. Even with an overwhelming majority of 211 Members, it seems that the Government is not sure whether the Bill will be passed without applying closure.
The real reason is that the Government wants to look tough. This Government which for the past three years has been dragging its feet, unable to show leadership and trying to look tough during the Post Office strike and the railways strike, wants now to do the same with refugees. It looks as if the Government thought that within a month, by playing the tough guys they would manage to make up for three years of foot dragging, of lack of a certain steadfastness which is expected from a Government.


Jean-Robert Gauthier: This is sheer hypocrisy.


Jacques Guilbault: My colleague says that it is hypocrisy. I will accept that word which I do not use normally. 1 know that my colleague from Ottawa-Vanier (Mr. Gauthier) has the reputation of being a fiery parliamentarian.
Let us go back to. the position of my Party which will not change even if the Government applies closure. At the same time, I should like to clarify a point for the benefit of my colleague for Vancouver-Kingsway (Mr. Waddell) who said earlier-and in fact, he has left the House and will not hear my remarks-that the Liberals have not stated their position.


The Acting Speaker (Mrs. Champagne):: I would ask the Hon. Member not to refer to the presence or absence of Members of this House. The Hon. Member for Saint-Jacques (Mr. Guilbault).


Mr. Guilbault (Sainte-Marie):: I withdraw those words, Madam Speaker. I usually follow the rules. Of course, to withdraw what I said will not bring the Hon. Member back to the House. In any event, he will be able to read Hansard tomorrow.
August 26, 1987

His statement a moment ago that Liberals are divided on the issue of Bill C-22 forces one to conclude that the Hon. Member has not been in the House for any part of the debate. The position of all Liberal Members and all Liberal Senators on Bill C-22 is the same, and I will inform my colleague who has not followed the debate, obviously, since he is asking me which position it is. Our position is very simple. It is the one Dr. Eastman put forward in his report. It provides for 10 years of exclusivity, not four. Not ten but four.


An Hon. Member:: And what is your position?


Jacques Guilbault: If the Hon. Member has something to say, why does he not stand up? Eh? What is the name of that guy who never stands up?


The Acting Speaker (Mrs. Champagne):: Order, please. The Hon. Member for Saint-Jacques has the floor.


Jacques Guilbault: You call to order those who often interrupt speeches.


The Acting Speaker (Mrs. Champagne):: The Hon. Member for Saint-Jacques has the floor.


Jacques Guilbault: I do not think I am attacking anyone when I state our position. It seems to me I have a right to do so. That is precisely why I was elected.
I was saying that our position is the one that was arrived at after a long inquiry throughout Canada by Dr. Eastman and a number of experts who consulted many Canadians. We believe that four years of exclusivity for the multinationals which produce drugs are enough. We believe that royalties should be increased from 4 per cent to 14 per cent. An agency should collect these royalties and allocate the funds to the producing multinational companies which keep their promises, do research and development of pharmaceuticals in Canada and create jobs. This is our position, it is very simple.
If you look at the amendments we proposed in the House- they are in the Order Papers, printed in the documents-and compare them to those presented by the Senate, you will see that there is no difference of opinion amongst Liberals, they are essentially the same amendments. Those who listened to the speech of the Leader of the Official Opposition this afternoon will have no trouble understanding the position of the Liberal Party.
Perhaps the Prime Minister (Mr. Mulroney) for some partisan reasons, will stubbornly continue to say: You are against jobs for Quebec.


Mr. Blais:: It is true.


Jacques Guilbault: As a matter of fact, I have just heard an echo from the other side which said: It is true.
The fact is that the difference in our position is quite simple. Instead of taking for cash or for granted that the drug multinationals will keep their promise to do research work and create jobs, we want guarantees. Therefore, we go even further than those who came to demonstrate here and told us to adopt
Patent Act
Bill C-22, for it would increase the level of drug research in Canada, protect jobs and create new ones. I understand them.
I agree when they want more research done in Canada, more protection for their jobs and new jobs created for other Canadians. However, I go even further. As I said in the House last Thursday, I do not see why I should rely more on the promises of foreign multinationals that 1 rely on those of the Conservative Party which believes blindly that the foreign corporations will deliver the goods.
Yet, I understand the position of multinationals: they want a 10-year protection. However, to obtain such a long protection, they will try their utmost not to commit themselves. They do not want us to legislate here guarantees which would force them to carry out research in Canada. Clearly, if they can avoid that, surely they are not going to complain. On another level, perhaps less serious, they do not want to give guarantees in writing either. If they can avoid that, they will. We heard a few speeches, a few words that were spoken. But even that would never have come, had they not been forced to do so.
Our position is to give fangs, to give teeth to Bill C-22, in order to have the assurance that research will be done in this country, jobs will be created in Canada, especially in the Province of Quebec I am representing here. It is therefore a complete distortion of our position to suggest, as certain Members in this House have done, that we are against job creation in Quebec. Only clowns can say that.
The three political Parties agree when it comes to increasing research in Canada. The three Parties agree on creating new jobs in research. The difference is, some Parties are ready to accept at face value the promises made by companies that are not even established in Canada, that have their headquarters elsewhere, in foreign countries. Our position is very prudent. It is to say: You claim that you are going to do research, that you will be increasing the level of research-good, we want legislative guarantees to that effect. And if multinational corporations in the drug industry are sincere when they suggest they want to do research, I do not see why they would oppose an amendment that was put forward and that would cast in concrete that obligation to do research. And indeed Senators returned to the House of Commons the same amendment we put forward originally.
The problem is, why does the Government refuse to put its money where its mouth is? The Government says: We want those companies to do research in Canada. But when we say to the Government: Take the steps needed through a package of amendments that is already there, amendments to ensure that this will happen, the Government's answer is: No, pass the Bill as it is. In short, the Government is telling us it is trusting foreign companies. Perhaps there are other reasons. Why is the Government rejecting that amendment? Is it under pressure from those multinational corporations that say: Look here, the Opposition is getting tired, they have been talking for a long

August 26, 1987
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time, in the end they will let it pass. Do not accept that amendment. Have no fear, we will do research. Were the American authorities themselves under pressure? We all know about the lobbying system in the United States, and 1 am not blaming the multinationals with headquarters in the United States for putting pressure on the American politicians and asking them to speak to us about it, because the Americans are well aware that the Prime Minister and the Conservative Party have promised to deliver a free trade agreement and must now do so as the Canadian Government would look rather silly if the free trade negotiations fell through. This is a pressure point or a lever which the American Government can use, and this might be one of the reasons why this Government refuses to accept an amendment which is otherwise extremely reasonable. When you want something to happen, you do whatever is necessary to ensure that it does. If not, you are faced with the present situation where the Government does not practice what it preaches. The Government says that it wants research and jobs, but when we suggest that it take the necessary action, it refuses to do so. I am beginning to wonder whether the Government is sincere in its desire to have more research activities carried out in Canada.
Madam Speaker, you do not have to be in politics for long to know that we have students in our universities who are learning how to do scientific research for the future. They chose science because they have the ability and the desire required and know that they will have stable and well-paid jobs. You do not need a dictionary to learn that. You do not need to have been a Member of Parliament for 20 years to understand that anyone who objected to this would not be reelected.
I therefore believe that the Government is going far enough today by imposing closure without repeating the nonsense that Liberals are opposed to research and job creation, as though Canadians could be so stupid as to believe that the politicians would have the idiocy of telling people that they do not want them to have jobs.


An Hon. Member:: There were 3,000 people.


Jacques Guilbault: I know that 3,000 people came. There is no need to repeat it. I saw them. However, 1 know that they came here in buses chartered by the companies. I know that these people came here to defend their jobs. I understand them. They were given a day off by their companies. It is not difficult to organize demonstrations such as that one.
Another thing I can tell them for instance is that I appreciate that they want to protect their jobs, but they should understand that some people can look a little bit further down the road, people who may have more experience in politics like some of us who have been here for quite some time and who have learned over the past three years that relying on the promises of the Party across the aisle is not necessarily the prudent approach.


Pierre Blais: You tell them that!


Mr. Cote (Lac-Saint-Jean):: How much more time do you have left?


Jacques Guilbault: I also learned a number of years ago that taking foreign companies at their word is not necessarily the most prudent thing to do. Notwithstanding the interjections of my friends, I have no problem continuing my remarks. I am fond of them because they goad me and this seems to keep me quite alert.
In conclusion, Madam Speaker, I repeat that the Government is making another mistake when it seeks to push Bill C-22 through as is, without any guarantee, that it is making yet another mistake by imposing closure. As I said a moment ago, the Government proves that it has no respect for party agreements. We did not tell the Government that we had changed our mind, that overnight we had come to appreciate the full value of Bill C-22; we said that we had debated the measure, that we got our message across and made our views clear, and that we were prepared to vote as soon as our leader would have addressed the House.


Robert Nesbitt Horner: Madam Speaker, I listened with great interest to the Hon. Member's remarks, especially at they concerned the Senate royalty fund.
I do not think he understands what he is talking about. According to page 365 of the Eastman Commission of Inquiry report, the royalty fund as proposed by the Senate would have raised $4.6 million for research in 1983. That is a substantial amount, but does not compare with the $1.4 billion that we will raise the other way.
The fund would have meant a cost to consumers of $30.6 million because of increased drug prices resulting from higher royalties. Over 10 years, using the same methodology, the total cost to consumers would have been $700 million to $1.1 billion.
When one considers another aspect, the Senate's proposal does not include a drug prices review board. There is no protection for consumers against these added costs. On the other hand, the drug prices review board as proposed by the Government, and supported by many different people, including officials in the Saskatchewan pharmacare program, is expected to save consumers hundreds of millions of dollars over the same time period.
The only conclusion I can reach is that the Senate's proposals are far more detrimental to the consumer than the Government's legislation. They come nowhere near the economic benefits of Bill C-22. How can the Hon. Member justify the Senate royalty fund raising $4.6 million for research at a cost of $30.6 million in increased drug prices? It
August 26, 1987

does not make sense to me. It may be Liberal philosophy, but it sure is not ours,


Jacques Guilbault: Madam Speaker, I will start with the second question. The Hon. Member asks why there is no price review mechanism in our position. It is simple to understand. There is no need for it. When one shortens the period of exclusivity and allows generic companies to begin copying the drug and retailing it at a lower cost after four years instead of ten years, the prices are kept down. Look at the experience in Canada when the period of exclusivity was removed and generics began copying and distributing at half the price. Prices went down. That is not difficult to understand.
Why would we agree with a price review mechanism that is proposed in Bill C-22 when it is only a review? There are no roll-back provisions.


Robert Nesbitt Horner: There are teeth in it.


Jacques Guilbault: There are teeth, but they are worn out. There are no real teeth.
Our proposal will make sure that prices do not go up. Therefore, there would be no need for a mechanism to try to push them down.
Everyone except the Tories understand that if you give a 10-year period of monopolistic exclusivity on a drug by a particular company, the price will stay up.


Robert Nesbitt Horner: Madam Speaker, I rise on a point of order. I asked a question concerning the Senate royalty fund and the Hon. Member is not answering the question at all. I would like some instruction to have him answer the question, please.


The Acting Speaker (Mrs. Champagne):: That is not a point of order. 1 am sure the Hon. Member for Saint-Jacques (Mr. Guilbault) was just about to answer the Hon. Member's question.


Jacques Guilbault: Fortunately,
Madam Speaker, the Chair has more perspicacity than the Member who has just interrupted me.
Of course, the Senate's royalty fund . . . First, I must say one thing. I said this earlier and I will say it again now. Perhaps the Hon. Member did not understand. Perhaps he was doing something else when I started my comments. Since I was speaking in French, perhaps the Hon. Member had trouble with the translation.
I said earlier that the Liberal Party's position was basically that taken by the Eastman report. I did not say it was an exact replica of the report. There are a few differences, and the Hon. Member may have overlooked that. The mechanism we are proposing is not exactly ... We did not take the report and make a photocopy and say: These are our amendments. We drafted our amendments as we saw fit. However, they are largely based on the Eastman report. That is why the Hon.
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Member... In any case, the Hon. Member did do his homework. He realized that there was a slight difference between the Eastman position on royalties and the position taken by the Senate. He should add: the position taken by the Liberals in the House of Commons as well. 1 don't know why he only saw the Senate's position, although he was here in the House when we moved our amendments. Maybe that is what the Hon. Member failed to see.


James Douglas Manly: Madam Speaker, does the Hon. Member believe that we have had a fair debate on Bill C-22 in the House, considering the fact that at second reading, which was ended by time allocation, there were four occasions on which we spoke to the Bill? They were November 20, November 21, November 24 and November 25, for a total of 11 hours and five minutes. There was a total of 26 speakers, and time allocation was moved after only five speakers had spoken.
In committee, this Bill had 13 sessions with witnesses. Fifty groups were heard, with a 45-minute time limit. The Government severely limited the number of witnesses who could be heard. It dropped the offer to travel to other parts of Canada and rejected the possibility of having American witnesses who could testify about the American experience without generic drug legislation.
At report stage, this Bill was ended by time allocation after 10 hours and 12 minutes, and after only two out of 11 groups of amendments had been dealt with.
Third reading of this Bill was ended by time allocation and our Party, for example, only had two Members who were able to address the issue at third reading.
Does the Hon. Member believe that Bill C-22 has been given adequate time for debate in the initial stages and has been given adequate time for debate since the Senate amendments have been brought down for discussion?


Jacques Guilbault: Madam Speaker, certainly we do not agree any more than he does that the Government was right in using time allocation. We resent those measures.
I just spoke against this horrible measure of which we have been given notice again today. We are certainly not very happy that the Government has done its best to reduce the number of witnesses before the committee. Certainly, more groups would like to have been heard and it would have been fair to give them an opportunity.
On the other hand, if the Hon. Member is asking me if our Party had time and opportunity to place its position completely before the House of Commons, before committee and, to please the Tories, before the Senate, of course we have had time. Of course our position is well known.
As I said earlier, we certainly had a chance to give our message and make our points known completely. Our position was that after our Leader spoke this afternoon we were ready

August 26, 1987
Business of the House
to vote on the Bill. Perhaps that answers the Hon. Member's question.
Obviously, we could have done without time allocation at the other stages, and obviously we could have done without closure. Certainly we would have been more happy if more witnesses could have been able to appear before the committee. However, nothing appears to be perfect in this world.


The Acting Speaker (Mrs. Champagne):: Is the House ready for the question?
[ Translation]


Jean-Robert Gauthier: Madam Speaker, on a point of order.


The Acting Speaker (Mrs. Champagne):: The Hon. Member for Ottawa-Vanier (Mr. Gauthier) on a point of order.


BUSINESS OF THE HOUSE
Jean-Robert Gauthier: Madam Speaker, 1 would like to ask the Parliamentary Secretary to
the Deputy Prime Minister and President of the Privy Council (Mr. Lewis) whether he could give the House some indication of the Bills or business that will be called tomorrow at eleven o'clock.


Philip Derek Lewis: Madam Speaker, I would advise my hon. colleague that it would be the intention of the Government to continue debate on Bill C-22. If we could come to a reasonable arrangement on the number of speakers or on a debate which would finish before five o'clock, it may not be necessary to invoke the closure motion.


The Acting Speaker (Mrs. Champagne):: It being six o'clock, this House stands adjourned until tomorrow at 11 a.m., pursuant to Standing Order 3(1).


[Stage Direction]
The House adjourned at 6 p.m.
[Stage Direction]

Thursday, August 27, 1987
[Stage Direction]
Prayers