1988-07-20

Mr. John Nunziata (York South-Weston):: Mr. Speaker, the Supreme Court of Ontario has decided that prison inmates in Ontario are entitled to vote. The court ruled that a provision in the Ontario Elections Act that disenfranchises prisoners is contrary to the Charter of Rights and Freedoms.
The effect of this decision is that all inmates, including federal inmates, will be allowed to vote in provincial elections. The effect of this decision is that inmates such as Helmut Buxbaum, Colin Thatcher, and Clifford Olson will be allowed to vote and to participate in the democratic process. That would be unconscionable, Mr. Speaker.
A Canadian citizen who is incarcerated and deprived of his freedom for committing a crime should also forfeit his right to vote. The right to vote should belong only to those who are Canadian citizens and to those who have respect for the rule of law.
1 call on the Minister of Justice (Mr. Hnatyshyn) to request that the Attorney General for Ontario immediately appeal the decision. As well, I call on the Government to seek an amendment to the Charter of Rights and Freedoms to exclude inmates specifically from the franchise.


QUEBEC MUNICIPAL ECONOMIC DEVELOPMENT BOARD
Mr. Marcel R. Tremblay (Quebec-Est):: Mr. Speaker, in order to promote and encourage job creation, the Quebec Municipal Economic Development Board has been associated with many projects in the industrial zones and parks of Quebec City.
In 1986, this resulted in some $41 million of investment. In 1987, the value of projects in which OMDEQ was involved reached $62 million, an increase of over 50 per cent. In two years, more than 2,000 jobs were maintained or created.
This performance reflects the dynamism of Quebec enterprise, small and medium-sized companies working in the service and high-tech sectors.
For 1988, we expect nearly $100 million in industrial and commercial investment for Quebec City. That is encouraging, Mr. Speaker! The very healthy economic climate resulting from the policies of the Conservative Party in Quebec and throughout the country is certainly responsible.
Like Andre Joncas, the director of OMDEQ, I would like to thank all those investors for openly showing their confidence in the promising future of the province's second most important economic centre, Quebec City, the capital.


AGRICULTURE
Mr. Stan J. Hovdebo (Prince Albert):: Mr. Speaker, a few weeks ago the Government announced some ad hoc drought assistance for western cattlemen. Being ad hoc in nature, the program is being designed and implemented on the run. It is already experiencing administrative problems.
First, cattlemen will have to wait several weeks before they can even get application forms. This means that they will experience cash flow problems well before the Government will be ready to pay out the promised assistance.

July 20, 1988
There is concern because the assistance rates are based on geographic areas which are too large to reflect drought damage accurately. Farmers on one side of a road may get less assistance than their neighbours on the other side of the road, even though both are equally affected by the drought. Other similar problems are coming to light.
If the Minister of Agriculture (Mr. Wise) would implement a long-term disaster assistance program as he promised he would do three years ago, farmers would not be faced with these administrative headaches. New Democrats call upon the Government to act now to develop a long-term disaster assistance program for Canadian farmers.


LABOUR RELATIONS
Mr. Barry Turner (Ottawa-Carleton):: Mr. Speaker, the Bell Canada strike by some 19,000 members of the Communications and Electrical Workers of Canada has to be resolved. I have here a letter from the Government Relations Department of Bell Canada which reads in part:
Despite the general walkout, the company is making every effort to maintain reasonable service to its customers.
The company should tell that to the people of Elmvale Acres and Chapel Hill in my constituency where serious sabotage has taken place in the last 24 hours which has knocked out the phone services there. In fact the people there cannot even get access to emergency services in the event that they are required.
Phones are an essential service in Canada now and should not be disrupted by sabotage. I am led to believe that neither party is talking. There is no expression that the parties want to get together. They are both unwilling to make concessions on key issues.
I call upon those concerned to stop burning cables and to start talking like intelligent, mature, responsible people. I also call on the Government to be prepared to appoint a mediator within 24 hours if no progress is made on this issue.


FISHERIES
Mr. Dave Dingwall (Cape Breton-East Richmond):: Mr. Speaker, last weekend, Highland Fisheries Ltd., a subsidiary of Clearwater Fine Foods of Halifax, closed its processing plant in Glace Bay, Cape Breton, Nova Scotia, throwing 310 people out of work in a town where there is already chronic unemployment.
The company closed this plant without proper reason and with a total disregard for the contributions the federal Government has made to the company and its predecessor in the last number of years. The manner in which this company has gone about this closure shows a total lack of corporate integrity and will not be forgotten by the workers.
In light of the closure, the responsibility now lies with the federal Minister of Fisheries and Oceans (Mr. Siddon). He can, using the many tools at his disposal, encourage senior management of that particular plant to reassess this closure and to have a business plan put in place in order to make the plant operational. The community and the workers want this to take place. They want co-operation. They want employment. They want the Government of Canada to come in on their side and fight for their economic interest by having this plant reopened.


HOUSING
Mr. John Oostrom (Willowdale):: Mr. Speaker, the housing crisis in the greater Metropolitan Toronto region becomes more acute as each day passes. Families are having a very difficult time buying a home due to high costs. In fact the perception beginning to set in is that, if you do not already own a home, you never will unless you have solid financial resources.
As a Government we must ensure that affordable housing is available to all. Presently the Town of Vaughan is in the process of negotiating with the federal Government the purchase of a 107-acre property owned by Environment Canada. The Government should sell the land with the condition that the majority of the site be used for affordable housing.
I believe that all surplus federal land which is to be sold must have affordable housing as its main usage.


APARTHEID-TREATMENT OF BLACK AND WHITE SOUTH AFRICAN ATHLETES
Mr. Howard McCurdy (Windsor-Walkerville):: Mr. Speaker, the 1977 Gleneagles Agreement which Canada signed specifically requires the signatories to discourage participation by their nationals in events involving South African athletes, and to withhold support for organizations promoting such contact.

*
[DOT]!>
*


July 20, 1988

Tennis Canada, a federally funded organization, invited two white South Africans to participate in the Players Cup next month in Toronto. Meanwhile, Albert Ramovha, a black softball player from Soweto, sought a visa on his own to attend, as a mere spectator, a tournament in Saskatoon. What was the Government's response? It was to deny the black softball player a visa because he might be mistaken for an official of his virtually all-black softball association.
There was no mistake with the white South African tennis players, for they were treated differently, and the invitation by Tennis Canada was legitimized. Why? Because $815,000 in prizes available to the South African tennis players make them admissible as entrepreneurs.
That is a policy so inconsistent with the Gleneagles Agreement, a policy based upon the greater weight of private profit over professional principle, a policy so discriminatory as to proclaim the victory of hyprocrisy over commitment, a policy intolerable to all opponents of apartheid that it must be changed so that Canada lives up in full measure to its commitment under Gleneagles.


TAX REFORM
Mr. Bill Tupper (Nepean-Carleton):: Mr. Speaker,
yesterday I was talking to my daughter who remarked "Dad, I got a raise". "Great", I said. "How much?" She replied, "About $55 a month". I asked her if she had checked her pay statement to discover the source.


Some Hon. Members:: Oh, oh!


John Barry Turner: Listen!


William Tupper: In doing so, she discovered there was no change in her gross pay but that the increase was a result of her income tax reduction. On checking with other members of my family I found similar results.
In a major parade that I was in last Friday evening, several constituents called out "Thank you, Mike Wilson". The Minister of Finance (Mr. Wilson) promised that some 80 per cent to 85 per cent of all Canadians would pay less income tax under tax reform. Canadians are discovering that he was correct.


NORTH ATLANTIC TREATY ORGANIZATION
Mr. Len Hopkins (Renfrew-Nipissing-Pembroke):: Mr. Speaker, during each fiscal year the Opposition in the House of Commons has a total of 25 days to bring forward items and
issues it feels should be debated. On March 4, 1988, I introduced the following motion for debate:
That this House recognizes the pivotal role that NATO continues to play in mutual security and defence and in furthering progress in arms control and disarmament and, therefore, reaffirms its commitment to continued Canadian participation in and active support for the North Atlantic Treaty Organization as a primary instrument of Canadian defence policy.
At the end of the day's debate a vote was taken on the motion. The NDP voted against it. We did not expect a Conservative Government to do the same thing, but every Conservative MP and cabinet Minister did vote against the motion. Only the Liberal Party voted for this reaffirmation of the NATO alliance. The Government had been strong in its rhetoric about NATO and then stood up in this House and voted against this reaffirmation on behalf of Canada.


NATIONAL REVENUE
Mr. William G. Lesick (Edmonton East):: Mr. Speaker, in recent weeks Revenue Canada officials in Edmonton announced their intention to assess selected Edmonton taxi firms for unemployment insurance contributions for taxi drivers, based upon existing federal tax jurisprudence. Such assessments will be retroactive to January 1, 1987.
Edmonton taxi brokers have expressed deep concern that the introduction of such unemployment insurance contribution assessments on a selective basis will create instability and, mostly, unfairness in the Edmonton taxi industry as drivers will move to unassessed taxi firms.
The taxi industry is an essential component of the Edmonton transportation network, especially now as Klondike Days, a major tourist attraction, start tomorrow in Edmonton.
I urge the Minister of National Revenue (Mr. MacKay) to introduce a UI premium contributions moratorium until all Edmonton taxi brokers have been assessed and properly notified of Revenue Canada's policy intentions in this regard.


INDIAN AFFAIRS
Mr. Simon de Jong (Regina East):: Mr. Speaker, Indian people from all over the country, and especially from Saskatchewan, are becoming increasingly frustrated with the Conservative Government.

July 20, 1988
Oral Questions
This week the Federation of Saskatchewan Indian Nations is hosting a forum at the Beardy Reserve to express their outrage at the Government's failure to settle outstanding land claims. Once again I and the New Democratic Party join Saskatchewan Indians in demanding that the Minister of Indian Affairs and Northern Development (Mr. McKnight) honour the Saskatchewan Formula, an agreement which was signed 11 years ago.
Much time and thought have already been spent on negotiating land claims. What is needed now is the political will and backbone to live up to those agreements. These treaties were not negotiated so that a Conservative Government could replace them at whim. Indians should not have to go to court to have these land claims respected.
By failing to commit itself to settling land claims quickly the Government is demonstrating its lack of commitment to the Indian people of this country. This country needs a New Democratic Party Government which will respect the rights of all its people.



ORAL QUESTION PERIOD


Right Hon. John N. Turner (Leader of the Opposition):: Mr. Speaker, my question is directed to the Prime Minister. Only the Canadian people have the right to change the fundamental nature of this country. Canadians have the right to vote on the trade agreement with the United States, but the Prime Minister has no mandate from Canadians to implement this agreement. Will the Prime Minister call an election and let the Canadian people decide?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, the House of Commons is now considering and discussing a great piece of legislation on free trade, and we intend to continue our work. To answer the Leader of the Opposition, I can inform him that when I came in I heard about a statement he just made, and I was surprised to hear that the Leader of the Liberal Party would offer the leadership of his elected Party to a handful of Liberals appointed to the Senate. This violates the most fundamental principles of our democracy, and the people of Quebec and Canada are watching.


PRIME MINISTER'S POSITION
John Napier Turner: Mr. Speaker, only Canadians right across this great country have the right to change the fundamental nature of how we live in this country.


Some Hon. Members:: Hear, hear!


John Napier Turner: This is a basic democratic issue, allowing the people of Canada to decide on a matter which is critical to our future.
I have not requested the Senate to reject the deal, I have asked the Senate to allow the people of Canada to reject the deal.


Some Hon. Members:: Hear, hear!


John Napier Turner: The issue is a simple one for the Prime Minister. Let the people decide. Why does he not call an election on this trade matter and let the people decide?


Mr. Rossi:: Don't sell Canada.


Martin Brian Mulroney: Mr. Speaker, I have always believed that it was the fundamental principle of parliamentary democracy that the House of Commons was supreme.


Some Hon. Members:: Hear, hear!


Mr. Gauthier:: The people are supreme.


Martin Brian Mulroney: We have today a violation of one of the most fundamental precepts of British parliamentary democracy. The Leader of the Liberal Party has asked the Senate of Canada, a bunch of appointed people, to hijack the most fundamental rights of the Canadian House of Commons.


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: The Leader of the Opposition wants me to run against Allan MacEachen, but I want to run against the Leader of the Opposition.


Some Hon. Members:: Hear, hear!


CANADA-UNITED STATES FREE TRADE AGREEMENT-REQUEST THAT ELECTION BE CALLED
John Napier Turner: Mr. Speaker, you know that I love and respect this House of Commons. But I say to the Prime Minister that the people are supreme and we will take this issue to the people.


Some Hon. Members:: Hear, hear!


Carlo Rossi: Call an election.


John Napier Turner: Neither the Prime Minister as Leader of the Government, nor his colleagues, nor, with the greatest of respect, the Members of this House
July 20, 1988

received a mandate from the people of Canada to change the nature of this country the way that trade deal does. I call on the Prime Minister once again to let the people decide. Call an election today and let the people make up their minds.


Martin Brian Mulroney: Mr. Speaker, the Leader of the Opposition has introduced a very novel concept into our constitutional considerations. This issue came up in another way during the life of this Parliament. On November 20, 1987, The Toronto Star reported that the drug Bill was approved as Senators surrendered. It stated at the end: "The entire process was extremely awkward for Liberal Leader John Turner who said both that he supported the proposed Senate amendments to the Bill but that he also believed the will of the elected Commons should prevail at the end of the day".
Of course, the will of the elected Members of Parliament must prevail at the end of the day. This is an unacceptable new concept that the Leader of the Opposition is introducing, that the will of the House of Commons should prevail at the end of the day, unless and until he asks Allan MacEachen if it is all right. It is all right. The contrary is not all right. The people of Canada will deal with the Leader of the Opposition.


Some Hon. Members:: Hear, hear!


An Hon. Member:: You're a fraidycat, Brian.


MANDATE TO LEGISLATE-PRIME MINISTER'S POSITION
Mr. Raymond Garneau (Laval-des-Rapides):: Mr. Speaker, what is at stake is not the supremacy of the Senate or the House of Commons, but the fact that Canadians should be allowed to decide on a fundamental question, the free trade agreement.
Mr. Speaker, I have a question for the Prime Minister. The Leader of the Government, during the campaign for the leadership of his Party, took a very clear position against free trade when he said, and I quote: "Free trade with the United States is like sleeping with an elephant; Canadian factories will be unable to compete with American firms operating on a much larger scale, without some form of protection ... ", Since that was the message he gave Canadians, where did he get a mandate to adopt legislation without consulting Canadians first?


Martin Brian Mulroney: Mr. Speaker, Quebecers are going to be very interested to hear what the Hon. Member just said. In fact, he is telling Quebecers and Canadians that despite the signing of the agreement, despite the fact that the Government of Quebec and seven other provinces have approved the agreement, and despite the solemn commitment of the Government of Canada and the favourable reaction of our elected representatives, the Liberal Member would have this impressive authority make way for the Liberal Senators, the same Liberal Senators who, when they were considering Bill C-22, tried to strangle economic
Oral Questions
expansion in Montreal. It didn't happen with Bill C-22 and it won't happen with free trade!


LIMITS OF PRIME MINISTER'S MANDATE
Raymond Garneau: Mr. Speaker, we are beginning to see how the Prime Minister wants this fundamental debate to be held. Instead of letting free trade be the order of the day, he is trying to change the course of the debate. I will ask the Prime Minister again, since he did not answer my question: Where does he claim to get his mandate to change the very fibre of the country in a fundamental way by bringing in such an important piece of legislation, a law that will profoundly affect the future relations of Canadian men and women with the United States, when he held a totally different position during the leadership campaign and during the 1984 election campaign?


Martin Brian Mulroney: Mr. Speaker, on November 18, 1987 in Le Journal de Montreal, the following was printed: "Last August, John Turner said that the Senators appointed by a Prime Minister had to accept the decisions of elected representatives. The Liberal Senators were appointed by a Prime Minister, Mr. Trudeau, and they must bow to the will of the people." Well, Mr. Speaker, that is a new and interesting strategy!

This is a new one and an interesting one, Mr. Speaker, because last week, on July 7, on page A4 of The Globe and Mail we read:
The Liberal majority in the Senate will not block the federal Government's legislation to implement the free-trade agreement with the United States, Liberal Senate Leader Allan MacEachen said yesterday.
"I would think not twice, but 20 times before I would recommend the Senate kill the Trade Bill in one plunge of the dagger," Mr. MacEachen said-
Now, in an act of desperation, the Leader of the Opposition no longer wants the House of Commons to consider this important matter. He wants to resign his leadership in favour of the Senate, and I say that is not good enough for the Canadian people.


REQUEST THAT PRIME MINISTER SEEK DISSOLUTION OF PARLIAMENT
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, my question is directed to the Prime Minister. The Prime Minister will recall that in 1983, when he was asked whether the kind of deal he has now negotiated with the President of the United States would be desirable for Canada, he said no. The former Secretary of State said no at that time. The Secretary of State for External Affairs said no. The Minister of Finance said no at that time. The issue is, should the people of Canada have a right to decide on this deal before the Prime Minister signs? Will he agree now with the majority of Canadians who want

July 20, 1988
Oral Questions
an election on this and do the right thing, dissolve the Elouse and go to the people of Canada?


Some Hon. Members:: Hear, hear!


Some Hon. Members:: Let's go! Let's go!


Some Hon. Members:: Go! Go! Go!


Martin Brian Mulroney: Mr. Speaker, this is a first, the NDP defending the Senate.


Some Hon. Members:: Oh, oh!


Mr. Hnatyshyn:: Right on! Absolutely!


Martin Brian Mulroney: We are in the process of debating free trade. We are in the process of creating new jobs.


An Hon. Member:: Yes, for Tories.


Martin Brian Mulroney: We have announced, on Monday, the Hibernia development, so important for Newfoundland and Labrador. We are getting on with the business of creating new wealth and prosperity for all Canadians-


Mr. Riis:: Buying new subs.


Martin Brian Mulroney: -we will do that. The House will consider all appropriate legislation and at an appropriate time I will be happy to oblige my hon. friend.


John Edward Broadbent: Mr. Speaker, I want to say to the Prime Minister that we are not defending the Senate of Canada, we are defending the people of Canada. That is what the Government should be doing.


Some Hon. Members:: Hear, hear!


John Edward Broadbent: If the Prime Minister had wanted Senate reform-


Mr. Gormley:: Twenty-seven per cent.


John Edward Broadbent: -we offered the Prime Minister not once, not twice, but three times, a measure that would substantially abolish Senate power, and the Prime Minister refused it three times. That is the reality.


PRIME MINISTER'S POSITION
John Edward Broadbent: Mr. Speaker, since the Prime Minister is now clearly reneging on what his views were in 1983, and the Cabinet itself, most of the Members of which opposed this kind of approach in 1983, has betrayed its trust to the people of Canada, does the Prime Minister have one good argument for not going to the people of Canada after almost four years into his mandate, a mandate in which he has betrayed his most serious commitments to the people of Canada?


Martin Brian Mulroney: Mr. Speaker, the Leader of the NDP asks if I have one good reason for not calling an election.


Mr. Manly:: Besides being afraid.


Martin Brian Mulroney: The work of the first mandate has not been done. As I have already indicated, our four years will not be up until September 17 next. I know my hon. friend is very exercised about the fact that people may have had a change of heart in respect to policy. Canadians can consider that. They will consider as well the change of heart of the Leader of the NDP in regard to NATO.


DEMAND THAT A GENERAL ELECTION BE HELD
John Edward Broadbent: Mr. Speaker, if the Prime Minister wants to debate and discuss external affairs, domestic affairs, and the Free Trade Agreement with the Americans, the New Democrats are ready. The Conservatives are the ones who are not ready for an election now.
And so I ask, for the third time: If the Prime Minister is confident in this approach to relations with the Americans, why does he not want to call an election, not in September, not in October, but right now?


Martin Brian Mulroney: Mr. Speaker, the socialist leader is calling for a general election. He had asked during the winter that the population be given the possibility of expressing its wishes through a vote. And so I called a by-election in the Lac-Saint-Jean riding.
The Leader of the NDP expressed his point of view at the time. We saw the results of his intervention in the Lac-Saint-Jean riding and I will give him the opportunity of measuring up, not only in the Lac-Saint-Jean riding, but in all of the ridings of Quebec and Canada.


EMPLOYMENT AND IMMIGRATION
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, my question is for the Minister of Employment and Immigration.
For two years now, the Miron Company in Montreal has been hiring Filipino workers for its factory ship, the Mary Nour, at an hourly rate of $1.74; they work nearly 80 hours a week in deplorable conditions, in violation of our labour and immigration laws.
Is the Government prepared to investigate this situation? What does it intend to do to stop this deplorable practice?
July 20, 1988
Hon. Barbara McDougall (Minister of Employment and Immigration):: Mr. Speaker, we did look into this matter. The Coast Guard investigated the situation as it arose. I am informed that this does comply with our immigration laws and with our employment laws concerning the crews of foreign ships. We are continuing to monitor the situation.
I can assure the Hon. Member that, should we discover that there is something that is outside the law, we will be happy to do something about it.


REQUEST THAT MINISTER INTERVENE TO PREVENT EXPLOITATION OF WORKERS
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, this is a clear contravention of Canadian labour laws and Canadian immigration laws. The Canadian public and the Minister should know that.
In this case we have people not simply acting as sailors but acting as industrial workers. Since they are acting as industrial workers, they should be subject to our labour laws and our immigration laws.
1 ask the Minister this question once again. Will she immediately take action to stop this deplorable practice of exploiting workers employed by a Canadian company in a Canadian port?
Barbara Jean McDougall: Mr. Speaker, I can simply repeat my first answer. We have taken a close look at this situation. My officials inform me that they are operating within the law, both within the immigration laws and within the employment laws of Canada.
I assure the Hon. Member, the House, and the people of Canada that I will ensure that my officials continue to enforce the law.


CANADA-UNITED STATES FREE TRADE AGREEMENT-REQUEST FOR GENERAL ELECTION
Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, I would like to ask the Prime Minister a question. In view of the fact that there are now considerable obstacles which are going to exist before his trade deal is accepted, I want to ask him in a very straightforward way if he is prepared to give a commitment to the House that there will be an election called before January 1, before the trade deal comes into effect, so that the Canadian people will have the right to pass judgment on this deal which is so harsh for their future.


Martin Brian Mulroney: Mr. Speaker, I thought that I had already answered that question
Oral Questions
in my response to the Leader of the NDP. In fact, the answer was such that it has driven him right out of the House. One shot and right back to the swimming pool!


Some Hon. Members:: Oh, oh!


Nelson Andrew Riis: The usual Mulroney cheap shot! It's no wonder you're a scumbag Prime Minister in the eyes of most Canadians.


Martin Brian Mulroney: I just want to tell my hon. friend that at an appropriate time there will be an election. He will have a chance to put forward his point of view. The Canadian people will have a chance to judge him.


Some Hon. Members:: Hear, hear!


REQUEST THAT ELECTION BE HELD PRIOR TO AGREEMENT IMPLEMENTATION
Steven W. Langdon: Mr. Speaker, after that belly-flop into his swimming pool, I would like to ask the Prime Minister the question which he has not in fact answered. Will he see to it that before this trade deal comes into effect, that is, before January 1, 1989, there will be chance for Canadians democratically, through an election, to pass judgment on whether the Bill makes sense to Canada or not?


Martin Brian Mulroney: Mr. Speaker, if my hon. friend and anyone else co-operates in getting the Bill through committee, I will invite him and others for a swim.


Nelson Andrew Riis: What a funny guy!


Mr. Nystrom:: Smart ass!


Martin Brian Mulroney: And then we can move on. I have already answered my hon. friend, and I have answered his Leader-


Nelson Andrew Riis: That's the kind of Prime Minister we have, a Johnny Carson Prime Minister.


Martin Brian Mulroney: -and I am trying to answer the Hon. Member but, unfortunately, I am being heckled by a member of the NDP who should know better, the so-called House Leader of the NDP.
All I am trying to do is tell the Hon. Member from Windsor that we have negotiated an important treaty with our friends, the United States of America. The House of Commons is considering it. A committee is paying attention to all the details. Once it comes back to the House and is passed, at an appropriate time we will take a look at future actions. But all of them will be consistent with the point of view that the House of Commons and not the Senate-


Simon Leendert de Jong: And not the people?


Martin Brian Mulroney: -is the body that was elected by the people and should prevail.

July 20, 1988
Oral Questions


Nelson Andrew Riis: You forgot that this is a democracy.


PRESENCE IN THE GALLERY OF GOVERNOR OF STATE OF WISCONSIN
Mr. Speaker:: I wish to draw to Hon. Members' attention the presence in the gallery of the Hon. Tommy G. Thompson, Governor of the State of Wisconsin.


Some Hon. Members:: Hear, hear!


EXTERNAL AFFAIRS
John Barry Turner: Mr. Speaker, my question is for the Deputy Prime Minister. In light of the apparent truce evolving between Iran and Iraq, and the recent government decision to normalize relations with Iran, and recognizing that in Canada there is a very large and very important Lebanese community, as the Deputy Prime Minister knows so well, can the Minister indicate what progress is being made by the Government of Canada to reopen our embassy in Beirut?


Hon. Don Mazankowski (Deputy Prime Minister and President of the Privy Council):: Mr. Speaker, I appreciate the Hon. Member's question and the interest that he has shown in this very important subject.
The Government is very favourably disposed to reopening the Canadian Embassy in Beirut. However, it would do so only after it was convinced that the personnel would be safe and could reside there in relative security.
I can tell my hon. colleague that the situation is being monitored very closely. When it is considered appropriate that our people would be safe and secure, then we will initiate positive action toward achieving the goal to which the Hon. Member has referred.


REGIONAL INDUSTRIAL EXPANSION
Mr. Gilles Grondin (Saint-Maurice):: Mr. Speaker, in the absence of the Minister of Regional Industrial Expansion, my question is directed to the Prime Minister. Yesterday, I heard to my great concern that the Shawbec plant in Shawinigan went bankrupt, when only two years ago the Conservative Government approved a grant of $2.3 million for a company that until yesterday employed nearly 150 people.
I therefore want to ask the Prime Minister how much of this $2.3 million has been paid so far? What were the conditions and what steps were taken to ensure that the amounts paid were used in accordance with the conditions agreed to when the grant was awarded?


Hon. Bernard Valcourt (Minister of State (Small Businesses and Tourism) and Minister of State (Indian Affairs and Northern Development)):: Mr. Speaker, not having received prior notice that the Hon. Member would ask for details about a very specific question, I will take his question under advisement, and we will transmit the information requested as soon as possible.


Gilles Grondin: Mr. Speaker, it is a specific question, it is a very currrent issue, and the people of my riding are very concerned.


REQUEST THAT INQUIRY BE INSTITUTED
Gilles Grondin: Mr. Speaker, as my supplementary, I would like to ask the Minister whether following this bankruptcy and considering the involvement of the Conservative Government, he intends to order an investigation to find out exactly what happened and why grants allocated only two years ago ran out so quickly, and also to find out whether there were economic reasons for the bankruptcy or whether it was the result of a management quarrel.


Bernard Valcourt: Mr. Speaker, I will take the Hon. Member's statement as a representation to the Minister of Regional Industrial Expansion. I will bring the Hon. Member's comments to the attention of the Minister, and we will advise him if any action will be taken.
July 20, 1988


MARINE TRANSPORT
Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, my question is directed to the Minister of Transport. Under Canadian law, Canadian companies, through their subsidiaries can move Canadian cargoes on foreign flag vessels thereby bypassing Canadian labour laws, Canadian safety laws, and Canadian health laws, as in the case of the Mary Nour which is the Panamanian registered vessel now in the port of Montreal.
Will the Minister tell the House what action the Government of Canada is going to take so that in future Canadian cargoes, whether they be cement, potash, or grain, are carried from Canada to other countries on Canadian-crewed and registered vessels?


Hon. Benoit Bouchard (Minister of Transport):: Mr. Speaker, marine shipping in Canada is subject to a set of regulations, and I have not been advised of any violation of these regulations by any vessel whatsoever. Considering the Hon. Member's request, I believe this is a normal situation. I will make the necessary inquiries to ensure that the law has been observed. If that is not the case, I will take the necessary action to ensure that there is no recurrence.


REQUEST THAT GOVERNMENT ACT
Iain Francis Angus: Mr. Speaker, the problem is that no law has been violated. It is the approach of the Government of Canada, starting with the Liberals and continuing with the Conservatives, that allows Canadian cargoes to be transported on non-Canadian vessels, thereby allowing 80-hour weeks and $1.75 an hour, and vessels such as The Paul Martin transferred to foreign ownership.
Will the Minister, whose Department has been examining the issue, finally give an indication to the people of Canada, particularly the marine sector, of what action will be taken to prevent this from occurring in the future?


Benoît Bouchard: Mr. Speaker, I can assure the Hon. Member that as I said earlier, and as he himself has confirmed, no law was violated. We are talking about a policy. We intend to look into the application of this policy. Now I make no commitment that it will be changed. However, I have no objection to considering the implications, and once again, if there are any factors that are detrimental to the development of the Canadian merchant marine, I will consider his proposal.
Oral Questions


REGIONAL DEVELOPMENT
Leonard Donald Hopkins: Mr. Speaker, my question is directed to whomever is answering on behalf of the Minister of Regional Industrial Expansion. On June 30 the Government allowed all regional industrial development incentive programs to lapse and disappear from eastern Ontario.
Large parts of the Ottawa Valley are now without an industrial and regional development plan for the first time since 1970. Industrial parks were developed by previous Liberal Governments. Tourism projects are in need of help to get off the ground, agricultural and forestry projects need a shot in the arm, and jobs are needed.
When will the Minister bring in a regional development program to address the dilemma in which the Conservative Government has placed the Ottawa Valley?


Bernard Valcourt: Mr. Speaker, the Hon. Member states that there are no programs left in that part of Ontario. He should do his homework, look at the books, and he will see that there are many programs still applicable to all of Ontario.


Some Hon. Members:: Name one.


Bernard Valcourt: As to the question of the new Department of Industry, Science and Technology, and what type of programs will be available to Ontario and to all of Canada, the Minister should be in a position very soon to make the announcements.


ECONOMY OF OTTAWA VALLEY
Leonard Donald Hopkins: Mr. Speaker, the Minister should do his homework because as of June 30, as I said, there were no industrial development incentives left for that part of eastern Ontario, and there are not.
Will the Minister bring in an industrial development plan that would include promoting the opening up of the Ottawa River under a tourism plan, together with industrial incentives, in order that we could have a combination of tourism and industry in the area, and introduce a larger element of small craft and recreational boating to the area? This would improve the over-all economy of the Ottawa Valley which needs diversification in its economy.
Instead of saying that no one has done his homework, will the Minister give his commitment that he will now bring in an incentive program for eastern Ontario?


Bernard Valcourt: Mr. Speaker, the best industrial development program for Ontario has been the economic policy of the Government which has seen the rate of unemployment drop in Ontario to 4.6 per cent. That has been a good program for Ontario.

July 20, 1988
Oral Questions


Some Hon. Members:: Hear, hear!


Bernard Valcourt: The Hon. Member is talki'.g about homework. I will advise him that the tourism subsidiary development agreement is always in effect in Ontario with over $20 million in it still to commit. There is a defence industry productivity program which has seen tens of millions of dollars invested in Ontario.
Most of all, we will keep on pushing for the free trade deal, because Ontarians know that this is in their best interest, and that is a good program for Ontario.


AIR CANADA
Mr. George Minaker (Winnipeg-St. James):: Mr. Speaker, my question is directed to the Minister of Transport. Today Air Canada announced that it would be purchasing 34 Airbuses to modernize its fleet, and will also have the aircraft maintained in Winnipeg.
Does the Minister concur with both decisions by the board of Air Canada? How will Winnipeg benefit from this decision?


Benoît Bouchard: Mr. Speaker, the Minister of Transport always agrees with that type of decision by Air Canada. We are delighted, and we approve of the decision by Air Canada, particularly because the people of Manitoba will now trust-not the Hon. Member for Winnipeg-Fort Garry-but the Government of Canada. The Government of Canada has always stated that the overhaul centre will be retained in Winnipeg.
Moreover, I wish to tell the House that this decision by Air Canada will give Winnipeg and Manitoba, already having the best expertise in terms of the maintenance of all Boeing 727 aircraft, not only for Canada, but also for the United States and North America, maintenance for the Airbus 320. It is what we said three months ago to the people of Manitoba.


BANKS AND BANKING
Mr. John R. Rodriguez (Nickel Belt):: Mr. Speaker, my question is for the Minister of State for Finance. On June 30
the Minister announced with great fanfare that a voluntary agreement had been made with the banks to drop several service charges and provide basic banking service to their customers. In the last few days my office has surveyed a series of banks across the country. It found that some branches had not yet dropped the NSF charge and most banks had not yet introduced a basic account which met the Minister's conditions.
In light of the fact that the Minister raised the expectations of consumers across the country that finally we would have justice for them, I think it is only fair for us to ask, "Where is Tom?"


Some Hon. Members:: Oh, oh!


Mr. Speaker:: Perhaps the Hon. Minister would like to answer that question.


Some Hon. Members:: Oh, oh!


Hon. Tom Hockin (Minister of State (Finance)):: Mr. Speaker, Tom is not a Johnny-come-lately to this issue.


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!


Thomas Hockin: As the Hon. Member knows, on June 30 the banks, after some pulling and hauling, agreed voluntarily-by the way voluntarily on the suggestion of NDP Members as well as Liberal Members. They supported the voluntary agreement in committee-


John R. Rodriguez: Never.


Thomas Hockin: They did, indeed; the banks agreed voluntarily to ban these obnoxious charges. A number of these charges have already been removed and the others will be removed in the next few weeks.
In terms of the basic account, my understanding is that of the eight major financial institutions in Canada almost all of them now have a basic account and two more will be moving toward having one in the next few weeks.


VOLUNTARY COMPLIANCE PROGRAM
John R. Rodriguez: Mr. Speaker, my supplementary is for the same Minister. I would rather be a Johnny-come-lately than a Tommy-come-never.


Some Hon. Members:: Oh, oh!


John R. Rodriguez: Settle down, guys.
July 20, 1988

It has been three weeks since the Minister introduced a so-called voluntary compliance, Mr. Speaker, and, in fact, my survey discovered that at best compliance is uneven across the country. I think it is summed up in the words of one of the bank tellers from Sydney, Nova Scotia, who responded to my survey, when she said: "Not much will be done about bank service charges until the Government legislates. We are only doing what we are doing out of good faith".
Will the Minister not agree, in view of the fact that he seems to have more faith in the banks than the people who work for the banks, that the time has come now to act, to legislate, and make changes to the Bank Act so that Canadian consumers can get justice with respect to their services at the banks?


Thomas Hockin: Mr. Speaker, it seems that the Hon. Member's research is faulty. My research indicates almost comprehensive compliance already. I would like to see his results, and if they are different from mine I will find out why.
More important, we have put in place a compliance mechanism which together with enforcing compliance will give us a report on the level of compliance right across every branch in Canada. We have done that for the consumers of Canada. The Party of the Hon. Member opposite wanted this done voluntarily in agreement with the Liberals and the Conservatives a month ago, but having done it voluntarily they stand up and criticize. The banks will comply and we will make sure they comply.


John R. Rodriguez: That is not true.


AIRPORTS
John V. Nunziata: Mr. Speaker, my question is for the Minister of Transport. It again concerns the issue of limousine service at Pearson International Airport in Toronto.
The Minister knows that the public is being ripped off by limousine service at Pearson International. He knows that the fares are exorbitant, that the delays are inexcusable and the service is terrible. It is all because of the monopoly that exists at Pearson International which the Government refuses to break up.
The independent drivers and owners at this very moment are protesting that this Minister issued 35 permits without tender to friends of the Government. Will the Minister stand up and explain why he gave to five limousine companies 35 permits worth over $4 million-a gift of $4 million-to friends of the Government, without tender and Without advertising? Is that
Oral Questions
the Conservative way of conducting the business of the country?


Benoît Bouchard: I answered that question yesterday, Mr.,Speaker. This Member is used to giving that kind of spectacular reaction. I told the House yesterday, and I repeat what I said, that we needed urgently to issue 35 limousine permits at the Lester B. Pearson Airport in Toronto to companies which are considered good companies which give the service that is expected in Toronto.
I said also that in the fall there will be a tender for 35 other permits and the tender will be opened up to everyone who wants to tender. I think it is a fair process.
Once again, we have more than what the Hon. Member has in mind. He has in mind a political issue. I have in mind the service to people at the Lester B. Pearson Airport at Toronto.


MINISTER'S POSITION
John V. Nunziata: Mr. Speaker, we want to ensure that the system is fair. Can the Minister explain why he intends to put out the tender for 35 permits in the fall while the 35 permits he issued a few days ago were not tendered? Is that fair? Is it fair to the independent owners and drivers that 35 permits should be given to five companies while the additional 35 permits are put out to tender? Can the Minister explain in no uncertain terms today why he issued those 35 permits without tender? That is the issue, Mr. Speaker. Why did he issue those 35 permits without tender?


Benoît Bouchard: Mr. Speaker, the Member wants to make this a political issue but it is not a political issue. There was an urgent situation. We made a decision, and we have made another decision for the fall and we will maintain that decision.

[Translation\


FINANCE
Marcel R. Tremblay: Mr. Speaker, my question is addressed to the Minister of State for Finance. It concerns the relative value of our dollar and the level of interest rates. Can the Minister tell Canadians how he feels about the constant increase in the value of the Canadian dollar?

Is our Canadian dollar currently too high? Could the Minister comment on the Canadian interest rate level compared to that in the United States, and has he noticed any difference over the last months in these rates?

July 20, 1988
Oral Questions


Thomas Hockin: Mr. Speaker, the value of the Canadian dollar is the result of the strength of the Canadian economy.

The strength of the Canadian economy largely accounts for the strength of our dollar. It has risen slightly in the last few weeks because of the intrinsic strength of the economy. Retail sales are up. Housing starts are strong. The expansion of credit in this country has been growing very strong in the last two months as well. Basically we have an economy in which the world has confidence.
Second, there has been some repositioning of monetary positions taken regarding the U.S. dollar with the co-operation of the United States Federal Reserve. In the sell-off of the U.S. dollar some of this value has been repositioned in the Canadian dollar which technically lifts our dollar to a slightly higher level.
More important, the Hon. Member asks about interest rates and their effect on the Canadian dollar. I think the Hon. Member should know that the spread now between Canadian interest rates and U.S. interest rates has narrowed significantly in the last three months. Therefore, the exchange rate presently for the Canadian dollar is in no way a function of the spread. If anything, the spreads are narrower. The result is a strong economy. The world is confident, and that is why our dollar is strong.


PUBLIC SERVICE
M. Mike Cassidy (Ottawa-Centre):: Mr. Speaker, my question is addressed to the Minister of State for Treasury Board. It concerns the fact that negotiations between the Government and its language teachers are at a standstill; the deadlock is due to the Government's stubborn determination to obtain major concessions that would adversely affect the quality of language teaching at a time when the Government has just passed a new Official Languages Act. Is the Government willing to withdraw its request for major concessions from the language teachers in order to allow negotiations to resume in good faith, with no strings attached, so that we might see a settlement of this conflict that has already dragged on too long?


Hon. Doug Lewis (Minister of State and Minister of State (Treasury Board)):: Mr. Speaker, I want to reiterate what we said earlier. A settlement was reached last September. The
parties agreed to go back and sell the settlement. Unfortunately PSAC did not. The finding of the arbitration tribunal was that PSAC had not bargained in good faith.
I reiterate what we said, that the Government is ready to go back to the bargaining table and to work on either the old agreement of last September or on any new suggestions which the language teachers have.


REQUEST THAT NEGOTIATIONS RESUME
Mr. Mike Cassidy (Ottawa Centre):: Mr. Speaker, whatever happened last September, the Hon. Minister knows that even if the Alliance had tried to sell the settlement it could not sell it today. That is why there have been sit-ins and demonstrations from a group of language teachers who normally would go along with things. Why is this group being singled out among all the bargaining units by the Government of Canada, and asked to make major concessions which the Government has neither sought nor achieved in its negotiations with other groups?
Why will the Government not agree to go back to the bargaining table, without pre-conditions, without having a fixed idea of what it should achieve, and bargain in good faith, rather than trying to insist on unacceptable conditions which it knows the language teachers cannot professionally accept and will not accept?


Douglas Grinslade Lewis: Mr. Speaker, their negotiators accepted that position last September. I do not know for a fact how many times the employees' association was found to have been bargaining in bad faith by the Public Service Staff Relations Board but that in fact is what was found here.
We believe that the agreement reached was fair. We are prepared to go back to the bargaining table and discuss the matter. That is where we would like to be now.


Mr. Speaker:: This will be the last question. The Hon. Member for Ottawa-Vanier.


REQUEST THAT MINISTER MEET LANGUAGE TEACHERS
Jean-Robert Gauthier: Mr. Speaker, I would like to continue in the same vein. The 800 or so language teachers have been wanting to meet with the Minister for some time now. He systematically refuses to meet with them, to explain his position clearly, and to lay out conditions that might be negotiated. Can the Minister tell the House now whether he is willing to meet with the language teachers tomorrow, or this very day, in order to solve this labour dispute?


Douglas Grinslade Lewis: Mr. Speaker, I reiterate that we have
July 20, 1988

skilled bargainers whose job is to meet and to negotiate. We believe the negotiating should take place at the bargaining table, not with the politicians.


MINISTER'S POSITION
Jean-Robert Gauthier: Mr. Speaker, the Minister is abdicating his functions. He is the Minister of State for Treasury Board and he has obligations. He has along with the employees of this Government a strong commitment to help them come to a conclusion in a conflict of such importance. Four years have gone by without a contract signed by these employees. Will the Minister sit down with them and negotiate a fair settlement? Never mind all this nonsense about, "I have professionals helping me". Do it yourself, Mr. Minister.


Carlo Rossi: He has to ask Brian.


Douglas Grinslade Lewis: Mr. Speaker, we are carrying on the policy of the previous Government of letting the negotiators do the negotiating. Our position is that we want them to come back to the bargaining table. We have no pre-conditions. We want them back at the bargaining table.



ROUTINE PROCEEDINGS


Mr. Richard Grise (Parliamentary Secretary to Deputy Prime Minister and President of the Privy Council):: Mr. Speaker, pursuant to Standing Order 106(8), I have the honour to table, in both official languages, the Government's response to 27 petitions numbered as follows: 332-4927, 3324928, 332-4958, 332-4970 to 332-4972 inclusive and 332-4974 to 332-4994 inclusive.
[Editor's Note: See today's Votes and Proceedings.]



TRANSPORT


Benoît Bouchard: Mr. Speaker, pursuant to Standing Order 99(2), I have the honour to table today the Government's response in both official languages to the fifth report of the Standing Committee on Transport.
Introduction of Bills



CO-OPERATIVE ENERGY CORPORATIONS TABLING OF AUDITOR'S REPORT

Mr. Jack Shields (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, pursuant to Standing Order 67(2), I have the honour to table in this House, in both official languages, the auditor's report and consolidated financial statements for the Co-operative Energy Corporations for the year ending December 31, 1987.



CRIMINAL CODE


Nelson Andrew Riis: for leave to introduce Bill C-310, an Act to amend the Criminal Code, (cattle rustling and range cattle).


Mr. Deputy Speaker:: Shall the Hon. Member have leave to introduce the said Bill?


Some Hon. Members:: Agreed.


Nelson Andrew Riis: Mr. Speaker, this is a Bill that does not have a lot of interest in many of the urban areas of Canada, but in many of the rural areas we have a serious problem, particularly in those areas that raise stock. It is interesting to note that each year virtually thousands and thousands of cattle are rustled, stolen, shot, mutilated, poisoned and so on by various people. It seems to me that the House would be well advised to take a position showing our outrage at these kinds of acts.
For example, in the Thompson-Okanagan area of British Columbia alone, last year 927 cattle were stolen or disappeared, and dozens more were shot or injured by hunters and poachers and so on. This Bill would essentially provide up to a five-year sentence for anyone who was convicted of cattle rustling, and if they were convicted of mutilating or poisoning or injuring cattle, they could be liable for up to 10 years imprisonment.
I think that we have to send a very clear signal that, while stock producers are having a difficult time these days, losing thousands of head of cattle to cattle rustlers is something that should stop, and perhaps the intent of Parliament along these lines should be to send a clear signal to those unscrupulous people.


Some Hon. Members:: Hear, hear!


[Stage Direction]
Motion agreed to, Bill read the first time and ordered to be printed.
[Stage Direction]
July 20, 1988
Petitions

Nelson Andrew Riis: Mr. Speaker, 1 have two petitions to present today from constituents. The first petition indicates the petitioners' opinion that the Government appears to lack a mandate from the people of Canada to conclude this trade deal with the United States. They believe that the trade deal seriously compromises Canada's sovereignty, and they are asking that Parliament dissolve to enable the people of Canada to have an opportunity to accept or reject the proposed trade deal during a national general election.
I also have another petition, which is quite differently worded, from a number of constituents who believe that the trade deal as such will result in a loss of many jobs in many sectors and regions of Canada, and that the trade deal between Canada and the U.S. would have a fundamental impact on our country's economic, cultural and political independence.
They have many other concerns, but fundamentally they are asking that the Government of Canada to enable the people to voice their opinion on this trade deal through a national general election.


Mr. Rod Murphy (Churchill):: Mr. Speaker, I have three petitions to present today. The first one is on behalf of a number of residents of Manitoba who have explained their concern with the issue of schizophrenia. They believe that it is a major illness in Canada, affecting about 1 per cent of the population, causing severe mental anguish and suffering to the patients and their relatives and costing Canadian society more than $3 billion annually in direct health care and other support costs.
They believe that the research effort that has been undertaken is not enough to limit this problem and not sufficient to meet the burden that this illness imposes on Canadians. Therefore, the petitioners humbly pray and call upon Parliament to ensure that research efforts related to schizophrenia will in the future be sufficient for the seriousness of this illness.


Rodney Edward Murphy: Mr. Speaker, I have a second petition signed by residents of my constituency, expressing their concern regarding the issue of abortion. They believe that the Supreme Court decision has left Canadians without any law restricting abortions and that nothing in the Supreme Court decision has established abortion as a right. And whereas human life is a continuum from the moment of conception to the moment of death and there is no point of time between conception and the birth of an infant at which point we could say that this is not a human life, therefore the undersigned, your petitioners, ever pray and call upon Parliament to pass into law legislation that will protect the life of the unborn child from conception and through all stages of development, with the exception of the extremely rare
situation in which the abortion is performed in order to save the life of the mother.


Rodney Edward Murphy: Mr. Speaker, my third petition is from residents of my constituency from the City of Thompson. These are the people I mentioned in Question Period earlier who are being forced to move from one trailer court in the City of Thompson to a new trailer court just a few blocks away. At the present time, these people receive door-to-door daily mail service, but because of the rules of Canada Post resulting from the Canadian Government's policy, these people will not receive personal door-to-door delivery in the future even though it is the same population moving from one part of the city to a very close neighbourhood. Therefore, the people who have signed this petition humbly call upon Parliament to demand that this cut-back in service not be allowed to proceed and that daily door-to-door mail service continue for all the residents of the trailer court regardless of its forced relocation.


Stanley J. Hovdebo: Mr. Speaker, it is my honour and duty to present two petitions, the first on behalf of constituents of Prince Albert who call upon the Government because they do not believe that the Government of Canada had a mandate to make a free trade agreement with the United States, to dissolve and allow the people of Canada the opportunity to accept or reject the proposed free trade agreement during a national general election. This petition, of course, forms the basis of questions we have asked in the House.


Stanley J. Hovdebo: Mr. Speaker, my second petition comes from people who are mostly from Ontario, places like London and Chatham. They suggest that food irradiation not become part of the food processing system in Canada and that our children not become guinea pigs for hazardous processes like food irradiation. They call upon Parliament to have an unbiased, independent agency of scientists to complete studies on the safety of consuming each food that has been irradiated, the effects of long-term consumption and the environmental dangers involved. In the event that any food irradiated be allowed, it should be clearly labelled as being treated with ionized radiation. Labelling should include packaged, bulk and imported foods as well as spices and other ingredients in prepared foods.


Jean-Robert Gauthier: Mr. Speaker, 1 have the duty and the obligation to table a petition from constituents and people from Manitoba as well to the effect that they disagree with the Government's intentions of
July 20, 1988

proceeding with the Mulroney-Reagan trade agreement and humbly submit that the Mulroney Government has sold out Canada and has received nothing in return. Whereas Canadian industries are still not protected from U.S. trade laws, whereas the United States obtained everything it wanted in all key sectors including agriculture, energy, auto trade, financial services and investment, whereas thousands of Canadian jobs are threatened and the Conservative Government has not provided for any adjustment assistance for Canadian workers, wherefore, the undersigned, your petitioners, humbly pray and call upon Parliament to denounce the Government for signing the Mulroney-Reagan trade agreement and they add that we should have an election on that issue.


James Douglas Manly: Mr. Speaker, I have a duly authorized petition from a number of Canadians concerned that the Government had no mandate from the Canadian people to negotiate a trade deal, that the Prime Minister (Mr. Mulroney) in negotiating the deal promised that Canadian sovereignty would not be compromised, pointing out that the trade deal compromises that sovereignty in three specific ways: by removing the power of the Canadian Government to control foreign ownership effectively, to develop Canadian energy resources in the best interests of Canadians, and to equalize opportunities between the regions. Therefore, the petitioners call upon Parliament to dissolve and to allow the people of Canada the opportunity to accept or reject the proposed trade agreement during a national general election.
[ Translation]


Mr. Fernand Robichaud (Westmorland-Kent):: Mr. Speaker, it is also my duty to present to you petitions from people in my riding, more particularly, from Sackville, Dorchester, Aulac and Middle Sackville.
The petitioners deplore the decision of the Department of Employment and Immigration to again change the qualifying period for unemployment insurance ...

The petitioners humbly pray and call upon Parliament to bring justice to the situation by keeping in place the 10-week qualifying period for the rural areas of southeast New Brunswick.


Mr. John Parry (Kenora-Rainy River):: Mr. Speaker, I have the pleasure and the duty to present to this Honourable Chamber a petition duly certified under Standing Order 106.
Business of the House

This petition is signed by some 70 residents, largely of the community of Ignace, and humbly prays and calls upon Parliament to designate all communities in Tier 3 ridings as eligible for the northern residents' tax allowance.


QUESTIONS ON THE ORDER PAPER
Richard Grisé: Mr. Speaker, I ask that all questions be allowed to stand.


Mr. Speaker:: Agreed?


Some Hon. Members:: Agreed.


Richard Grisé: 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
Douglas Grinslade Lewis: Mr. Speaker, there have been discussions among the Parties, and we have made some changes to the order of business today, changes which were communicated to the Parties earlier in the morning. It is our intention to call for debate the item on the Order Paper No. 35 under government business which begins:
WHEREAS the fur industry plays a vital role in our traditional rural
economy;-
There has been an understanding between the Parties that there will be one speaker for each Party and that the question will be put after the third speaker. We would then proceed to resuming debate on Bill C-139, the tax reform measure.


Some Hon. Members:: Agreed.

July 20, 1988
Fur Industry



GOVERNMENT ORDERS


[Stage Direction]
REAFFIRMATION OF SUPPORT FOR INDUSTRY Hon. Doug Lewis (Minister of State and Minister of State (Treasury Board)) moved:
WHEREAS the fur industry plays a vital role in our traditional rural economy;
AND WHEREAS well-managed trapping, as practised in Canada, is in accordance with the principles of the world conservation strategy;
AND WHEREAS Canada is a world leader in humane trap research;
AND WHEREAS this House has previously affirmed its opposition to a proposed resolution before the British Parliament on the labelling of fur products from Canada;
BE IT RESOLVED THAT the House of Commons reaffirm its unanimous support of the Canadian fur industry in recognition of its economic importance to the country and its importance in sustaining resource development economies of both native and Northern communities;
AND THAT the House of Commons reaffirm its opposition to trade distorting measures by foreign governments, such as are now being proposed for consideration by the European Parliament.
Mr. John A. MacDougall (Timiskaming):: Mr. Speaker, I rise today to speak on this motion introduced by the Minister of State for the Treasury Board (Mr. Lewis) on July 18. It deals with the vital role the fur industry plays in our traditional rural economy.
All Hon. Members recall the emergency debate that took place in the House on June 1. Members from all Parties spoke on the concerns we all had that the British House of Commons was currently considering legislation which would require fur products to be labelled clearly to restrain in effect and check retailers from selling furs from Canada and the public from purchasing them.
That evening, the Secretary of State for External Affairs (Mr. Clark) and the Minister of Indian Affairs and Northern Development (Mr. McKnight) gave eloquent speeches defending the trapping and fur industry in Canada. They, along with all Hon. Members, gave a clear and strong message to the British Parliament.
We all know that the British Government scrapped that Bill on June 18. All Members of the House were very pleased with the news. However, I, along with other Members, realized at the time that it was just a small victory in a very long and determined battle with a group that was intent on destroying an industry and a way of life for so many Canadians.
Today we have another threat to the livelihood of many Canadians connected with the fur industry. The European Economic Community has put forward a motion which, if approved, will have the effect of moving forward the same legislation which the British Government scrapped on June 18 concerning the tagging of Canadian pelts.
I would like to take a few moments to speak about the economic aspect of the fur trade for Canadians. The industry is worth approximately $600 million annually. There is a spinoff of $200 million for allied industries. For the last two to three years, Canadian fur exports totalled approximately $350
million annually, much of that going to the European market. To put those figures into perspective, 105,000 Canadians earn all or part of their income from the fur industry. Approximately 100,000 are trappers, half being aboriginal people. More than 80 per cent of the retail fur sales in Canada are made through privately owned, family run, one store businesses.
Above and beyond the economics of this issue, and even more important, are the social and cultural factors involved when considering the native people and our northern communities. As you well know, in December of 1986 the Standing Committee on Aboriginal Affairs and Northern Development presented the House with The Fur Issue Report. The committee heard from many Canadians who depend directly on the fur trade. The report said that, for native people, trapping involves more than simply trying to earn cash income. It implies a unique social, spiritual and cultural relationship with the land and its resources. For northern communities, trapping and trade are the activities which hold the people together, creating a bond of belonging, and providing all of the inhabitants with a purpose. Those comments were echoed time and time again in our committee hearings.
May I remind my colleagues in the House that this is not the first time we have been charged with defending our fur industry. Both in 1979 and 1982 we considered the serious threat and implications of the anti-fur campaign with respect to the seal hunt. Then the European Community banned imports of seal pup pelts as a reaction to a lobbying campaign based on an emotional appeal which was very shallow in its facts. Through an effective use of the media, the animal rights movement was successful. The devastation caused by the collapse of our industry, especially in the Maritimes, is well recorded.
There are towns today which are economically ruined, where families have had to move or have been torn apart. An entire way of life was altered because we were unable to put an effective case forward for our seal hunt. The loss of that hunt and what it meant for thousands of Canadians can still be seen today in family break-ups, bankruptcies, needless suicides, alcoholism, the loss of individual self-worth, dignity, and sense of belonging. We cannot allow those tragedies to reoccur.
The impact of the animal rights campaigns and the anti-fur campaigns, particularly those in Europe, have been felt by many Canadians. Our Government, in partnership with the Canadian Fur Institute and other representatives of the industry, has taken steps to address these concerns. In the past decade we have become increasingly active in the conservation and management of our wildlife, in the development of humane trap testing and design, trapper education, and education of the public on the trapping advancements which have been made in Canada. However, it is evident from the ever-increasing and constant pressure being applied by the animal rights groups and anti-fur lobbyists in Europe on their elected members that our efforts are not being fully recognized or appreciated.
July 20, 1988

Succinctly put, the animal rights groups are unrealistic in their goals, and if those goals are met it will undoubtedly be extremely harmful to the many Canadians who depend on the fur industry for their livelihood. What the British and European Parliamentarians and public must recognize about our fur industry is that it is the responsible harvesting of a renewable resource.
I raise this issue today because I feel it is extremely important at this time to send a strong message to the European Parliaments and public. What those elected representatives are being told through the animal rights lobby groups are distortions and manipulation of fact. As they did with the pup seal issue, these interest groups have singled out Canada and our export industry as their initial target. The European public is being fed videos, billboards and posters filled with misinformation and half-truths.
The time has come for Canadian Parliamentarians to act together. I say to my colleagues that we must remain steadfast in our support for the fur industry, for trappers across our country, and for our native communities and peoples for whom the fur trade is an integral part of their lives.
Canada is in the forefront of humane trapping research. The Canadian Government and the fur industry have already committed over $8 million to scientific research programs. The results of this research in terms of improved humane trapping technology, including leghold systems, is extremely positive.
Meetings with officials from the Department of External Affairs, the Department of the Environment and the Department of Indian Affairs have been ongoing. There have been meetings with European officials to gather support for our position. I call on all Members in this House to join together in sending to the European Community members the strongest support possible for the 105,000 Canadians who are directly and indirectly employed in a vitally important industry.
I believe it is fitting to close with this final comment on how important this industry is to Canadians. I wish to draw into focus what this debate is all about. This reflects not necessarily on an economic industry or an export commodity, but on the sense of being, livelihood and way of life of individual Canadians. During our hearings a trapper came before us and this is what he had to say about trapping:
I have been a trapper all my life. 1 had a family, but I lost my wife. I am just
by myself now. I am 69 years old. 1 draw the old age pension and 1 am still
trapping. I have never been to school. I just live in the bush. All I know is how
to sign my name on a cheque. I cannot read one word, but I love the way 1 live.
That is what we are talking about, the livelihood of individuals, and it is being jeopardized. I want to thank my colleagues for the support they have given on an issue vital to all northern Canadian communities.


Mr. Keith Penner (Cochrane-Superior):: Mr. Speaker, I, along with the other members of my Party, wish to indicate to the House that we support both the thrust and objective of this
Fur Industry
government-sponsored notice of motion regarding the fur trapping industry in Canada. We in this Party believe that the wording could have been even stronger but, leaving that aside, we believe we must convey a message of opposition to the European Parliament with regard to the misguided and destructive proposal to label fur products imported into the European Economic Community. These labels would have no purpose other than to create, in the minds of some consumers, a false and completely wrongly-based sense of guilt.
1 regret that time allows for only one speaker from each Party because there are many other Members in my Party who would want to express their views on this important issue of the fur industry in Canada. The Member of Parliament for Renfrew-Nipissing-Pembroke (Mr. Hopkins), who is in the House today, would certainly have spoken in his usual eloquent way. In fact, he has spoken on this issue. He has raised questions in the House and is giving leadership in his own constituency to those for whom the fur industry is important.
My friend and colleague, the Hon. Member for Gander-[DOT] Twillingate (Mr. Baker), would also have spoken. He would have told the House about the devastating effect the EEC ban on the seal trade has had on communities of which he is aware. The same could be said for the Member of Parliament for Grand Falls-White Bay-Labrador (Mr. Rompkey). They would all have spoken from personal experience and with considerable emotion on this important issue.
A mammoth new volume entitled Wild Furbearer Management and Conservation has just been released. It was published by the Ontario Trappers Association under a licensing agreement with the Ontario Ministry of Natural Resources. It is an important piece of work. It is a large volume and costly to purchase, but I hope that many libraries will be able to buy it in order that more Canadians can be well informed about the fur industry in Canada.
This volume quite correctly points out that the fur trade played an important part in the economic development of North America. However, more to the point of today's debate, the fur trade remains a dominant industry in the vast boreal forest of the Canadian sub-Arctic which is the largest region in Canada. I have the good fortune to represent a significant part of that important region in our great country.
Climatic conditions favour the production in this region of very high quality fur pelts. Trapping for these pelts is a means of wildlife harvesting. I cannot emphasize that too strongly. It is wildlife harvesting. This means harvesting a resource which is renewable. Trapping for these pelts means that those who engage in the industry must be very conservation-minded because conservation is an essential aspect of this activity.

July 20, 1988
Fur Industry
The vast boreal forest region of Canada does not lend itself to other kinds of industrial activity. For example, it is not well suited to large-scale agriculture. Although this region of which I speak is very well endowed with minerals, economically viable mineral deposits are found in only relatively small portions of that area. The forestry resource is substantial but commercial exploitation is generally restricted to the southern periphery of this region. Thus it is, Sir, that the fur trade is still the region's most extensive industry providing some income to the greatest number of people.
In Canada about 100,000 people are engaged in trapping. More than one-half of these are aboriginal trappers. We can safely estimate, given an average of four people in an aboriginal household, that nearly one-quarter of a million aboriginal people in Canada rely to some extent on the fur trade, a trade which in a good season may bring in between $5,000 and $10,000. That is not a great deal of money, but it is used to buy essential equipment manufactured elsewhere but needed in these modern times by our aboriginal people.
I say to you, Sir, and to all Members of the House, that if the fur industry collapses-and the proposal now before the European Parliament will, to a significant extent, contribute to that collapse if it happens-it is the aboriginal people of Canada who will suffer the most.
As many Members of Parliament know, the seal ban by the European Economic Community created serious social dislocation in a great many Inuit communities. The rate of suicide went up as did alcoholism and drug abuse. Mr. Gordon Wray, the Minister of Economic Development and Tourism in the Northwest Territories, recently indicated in an interview he gave to the Toronto Globe and Mail that:
Animal-right groups opposed the slaughter of harp-seal pups in Newfoundland and succeeded in mobilizing the European Community to boycott seal skins in 1984. In the NWT, where most sealing is done, the hunt took only adult seals. Residents insist the centuries-old practice maintained a delicate ecological balance, as well as holding together Inuit communities.
In 1980-81, sealers earned $884,000 but this dropped, after the EC ban, to only $77,000 in 1983-84, and then to a negligible $26,000 last year.
Mr. Wray said that the social dislocation inflicted on these communities is staggering. Children who were raised to revere sealing as an honourable livelihood saw television commercials portraying their parents as criminals. During the same period 21 of 29 Northwest Territories coastal communities received substantial increases in social assistance. Therefore, this European move created social chaos in the Inuit communities, took away the livelihood of these people, and placed them on social assistance taking away their self-respect and dignity.
In northern Ontario the Indian people who belong to the so-called Treaty Nine Area are organized as the Nishnawbe-Aski Nation. Many of these people depend on trapping as their only source of income. Recently there was an editorial in the Wawatay news, an aboriginal peoples' newspaper. That editorial said that trapping "means a way of life that retains a traditional economic activity".
Eighty-five to 90 per cent of the Nishnawbe-Aski Nation people are engaged in trapping to some extent. Many are only part-time trappers. In the western James Bay coastal communities 80 to 85 per cent of the people trap. The unemployment rate in these communities is between 80 and 85 per cent. These people trap in order to supplement their meagre incomes, to supplement their social assistance.
Trapping, hunting, and fishing are all part of living with the land, in harmony with the land, and off the land. Not to understand that is to lead one to a false and fallacious conclusion. It is that the furbearing animals of this country are systematically being destroyed because there is a fur industry and because people go out trapping. That is far, far from the truth.
I want to point out that animal-rights activists tend mainly to be urbanites and what they fail to realize in their misguided zeal is that it is the growth of cities, its building of superhighways and airports that have been far more detrimental to wildlife than trapping will ever be. It is the loss of habitat to overdevelopment and industrialization which is the real danger to wildlife, not trapping.
How ironic it is that we are today, in this House, I expect unanimously resisting and opposing a proposal that will go before the European Parliament, when in Europe we had those successive European wars in the nineteenth and twentieth centuries with the slaughter of millions upon millions of young men. This paved the way for massive industrial expansion in Europe and pollution on a basis that was never known anywhere in the world before. Now these same European nations, at least speaking through some of their representatives in the European Parliament, want to restrict the importation of wild furs from Canada. It is more than ironic, it is crass hypocrisy. Trapping is not a threat to furbearing animals.
In fact, the Aboriginal Affairs Committee heard testimony that the furbearing population in Canada is at least as high if not higher than when Europeans first came to this continent. After 400 years of commercial fur trade, most furbearing species in North America are still flourishing, and those few species today that are in danger, are threatened mainly because their habitat has befen destroyed. I believe that animal rights activists are best advised to focus their attention on the humane treatment of pets and other domestic animals.
The trapping of wild animals in Canada involves the survival of a culture, a way of life. I am speaking of the culture and way of life of aboriginal people. If these city-dwelling zealots who, in my view, constitute a part of the urban lunatic fringe, have their way, they will be responsible for nothing other than cultural genocide. The proposal planned for the European Parliament will contribute to the destruction of that culture and that way of life.
July 20, 1988

Let me speak about some of the concerns of these people, which they have inflated beyond all reason. In Ontario there is a native education program. It is sponsored by the federal and provincial Governments. In the past year over 500 aboriginal trappers were exposed to more modern and humane methods of managing and harvesting furbearing animals. Educational programs such as these, plus the millions of dollars that are being spent on trap research, are in my mind the effective ways to combat the anti-trapping movement. The labelling of products, the boycotting of fur garments are illogical and silly ways of proceeding.
It should be noted in addition that for many trappers, the food value of the animals that are caught often surpasses the value of the fur pelt itself. In many remote areas there are often limited options for food. Most beaver, snowshoe hare, muskrat and bear whose skins are sold, are also used as food. We have studies that show that the value of the meat thus harvested is in many cases greater than the value of the fur itself.
The issue here is not one of abuse. Not at all. The issue here is not one of non-use. Not at all. The issue is one of wise use of a resource. In my experience, trappers are among the most active supporters of wildlife conservation. Why would they not be? Their own livelihood is involved. Of course they are conservationists. Fur trappers tend to be among the most conservationist-minded of people.
Recently, the Cochrane Area Fur Council wrote to me about their industry. In their letter they said: "Conservation means the wise use of natural resources".
I conclude by saying to the House that Europeans must be helped in their understanding and appreciation of aboriginal culture. Trapping is a vital aspect of that culture and by supporting this notice of motion today in the House we are saying to European countries, to the people of Europe: "Turn your attention to the relevant problems that exist on your own doorstep. Please do not reach out in an uninformed and selfrighteous manner and destroy an industry, a way of life and even a people which are indigenous to this nation of ours here in North America".


Some Hon. Members:: Hear, hear!


John Edmund Parry: Mr. Speaker, I am glad to have the opportunity again today to address some remarks on the question of measures that have been proposed in other jurisdictions with regard to the labelling of fur. The measures that were first proposed in the British Parliament have, very happily, been withdrawn. But they are now within the European Parliament of the European Economic Community.
I believe those proposed regulations are profoundly misleading and profoundly dangerous to the basis on which international commerce and international relations are undertaken. They are profoundly misleading to the people who might read them.
Fur Industry
I am glad to join with my colleagues in all three Parties in extending thanks and recognition to the Government for the opportunity again to address this important question. As I recall, I was the second to the last speaker sometime after midnight on the morning of June 2nd when we were addressing the motion that had been put forward at that time. We heard from all three Parties, but I am glad to say that my Party participated most fully in that particular debate. I am pleased that all Parties and all Members who spoke were united in their concern for the impact these regulations might have on aboriginal people of this country.
Arriving very recently in Ottawa, I have not had the opportunity to research the exact procedure and stage of this proposed measure before the European Economic Community, but I think the specific stage is perhaps not so important as is the need and urgency for this House to get across to those major partners of Canada-and let them not forget it-in the European Economic Community that Canada does not appreciate this sort of interference and harassment of the longest standing, continuous commerce between our country and the European Economic Community.
I looked at the historical perspective in my speech of June 1 and 2, and I believe it is worth re-emphasizing. Let us remember that it was the European market that built up the fur industry in this country. Successive generations of European consumers, furriers, traders and merchants have dealt with successive generations of Canadian trappers, both aboriginal and non-aboriginal. This was done by means, of course, of the intermediaries the great trading companies and the co-operatives of today, such as the Ontario Trapping Association. Let us, above all, not forget that it was the fur trade that radically altered the economy, traditions and lifestyle of the aboriginal people, during what is considered to be a period of pre-history but about which more and more is becoming known. It led to some very drastic changes by the aboriginal people, by the Metis and by the early European trappers and traders in order to restructure the economy and life of North America at that time.
There was a time in this country when the fur trade was the largest part of the economy. There was a time when it was, so to speak, the fer de lance of exploration and economic development within Canada and the northern part of what is now the United States. Indeed, there was a time when the fur trade provided this country with its basic currency, its first universally accepted trading medium. That was the standard beaver, as it was known. The Hudson's Bay Company, and the Northwest company before it, kept their accounts not in pounds, shillings and pence, not in dollars and cents, but in what were called "made beaver", what we would now call a double-x large beaver pelt in prime, flattened and properly tanned. At one time it took a pile of made beaver as high as a musket to buy that same musket.

July 20, 1988
Fur Industry
Let us not forget that even as Canada grew and developed, and exploration pushed back the frontiers of the imported European civilization, in many parts of this country it was trapping and the fur trade that provided not only the basic raison d'etre of many communities but was the largest part of the economy in a whole region twice as large as the entire continent of Europe.
In examining this question today, we have to be very careful in our approach. We have to remember that mere oratory or rhetoric, and even, as important as it may be, the reiteration of the importance of fur trade to Canada's economy, particularly to the aboriginal people, is not the most effective thing we can do. What we have to do is to work towards an understanding of why these labelling regulations are being brought forward. We have to work towards a strategy to counteract the motives behind the introduction and proposals of such legislation or regulation.
I think it is worth spending some time to consider the psychology that underlies the attempts to have Canadian fur mislabelled, or, I would say, labelled in a misleading fashion that is designed to deter some consumers, although, frankly, I am surprised at the store that is set by this because I do not believe it would be terribly effective even if it went into effect.
As the Hon. Member for Cochrane-Superior (Mr. Penner), a defender of aboriginal people in this House over two decades, pointed out, it is primarily because of the psychology of urbanization. Urbanization in the European continent even since the Second World War, which was largely fought on that continent, has taken the proportion of urban dwellers to near double pre-war levels, somewhere, 1 believe, in the region of 80 per cent. That has led to a divorce between the people and their sustenance. It has led to a divorce between the people of the European Economic Community and their environment, a divorce between them and those who supply them with the means of everyday living.
Along with that divorce from nature has grown an unreal psychological environment in which people are raised. I should know because, after all, I was raised in what is still the largest city in the European continent. The feelings that arise very naturally within the minds of human beings are all too easily transferred and transmogrified because of the environment in which they live. We learn, and certainly people in Europe learn, to have respect for those who are near and dear to us, but increasingly that respect is set against an appreciation of the wider environment. It is said that there are children within the inner City of London who, at the age of nine years, have never seen a cow, yet drink milk every day. That does not surprise me because it is a long haul from that city out to the country where one could actually see a cow.
In an age of increasing affluence, people have come to identify animals not with the milk in the glass, the slice of roast beef on the table, the leather on the shoes they wear, but with the hamsters and the gerbil, the pussy-cat and the lapdog, the pets they keep on an everyday basis and for which, understandably, they have feelings.
Another sad consequence of that divorce from the natural environment, even with television bringing the images to our homes on a daily and even hourly basis seems to be a divorce from an understanding of the plight of fellow humans. There are people starving on the sidewalks of Calcutta, there are the wasted fields of drought-scorched Ethiopia, the flood victims in Bangladesh and the victims of malnutrition and elevated child mortality rates in the Andes, among the aboriginal people of the southern American continent. It seems that as a society we are losing our understanding and compassion for our fellow human beings who live in those circumstances.
There has to be, of course, a specific spur to action, to mobilize the psychological factors I have described. We might very well ask, and would, I hope, ask our foreign Minister, who did such good work with his namesake, the junior trade Minister from Great Britain, Mr. Allan Clark, to ask these questions of the European Community. Why does the European community not take action against bullfighting? Why does it not take action against the obscene sport of fox-hunting which is still carried out in the United Kingdom? Why does it not take action against the barbarous practice of many French farmers who nail to the floor the feet of geese and force corn down their gullets in order to produce pate de foie grasl
Let us not be seen to be pointing fingers because we all are prey in some degree to such actions and such motivations. The fact is that the European Economic Community has decided to take action on fur trapping and fur products because it is much easier to try to beat up an external "enemy" than to address some of the grave divisions and dissensions within European society, whether it be on a single country or on a pan-European basis.
We should understand that motive. We should be very clear to the countries of the European Economic Community that we do understand those motives and that Canada is not without the ability to resort to trade sanctions and trade measures if indeed such regulations are passed within the European Parliament.
My hon. friends from Timiskaming and Cochrane- Superior have said it well already. The trapper is a conserver. The trapper is a harvester. There is no species on the North American continent that has been endangered by trapping. The passenger pigeon was exterminated because of the desire for food, not by trapping. The true enemy of the survival of wildlife species is indeed the destruction of habitat, the destruction that is carried out as a by-product of economic activity, it would appear, within the European Economic Community and, indeed, in many other jurisdictions because environmental protection regulations are not perfected here in Canada, not perfected in any jurisdiction.
July 20, 1988

Let us not forget the number of species that have been exterminated in Europe by habitat erosion. Let us point out to the Europeans that it is by protection of the habitat, of which having communities of people and having active trappers is an essential part, that species will be saved from extinction.
Turning briefly to the cruelty issue, nobody will pretend that it is in some way an amiable experience for the animal. But we have heard a great deal of dissimulation and misinformation from European sources, and even from so-called animal rights advocates in this country, as to the nature of what an animal does or does not feel, and particularly as to the nature of what animals are being trapped.
There is no large-scale problem with so-called unwanted or scrap species. Trappers came before our committee on the hearings that the Hon. Member for Timiskaming mentioned. They said: "Not once in my career as a trapper have I taken an animal other than the animal that I wanted to take in that trap". I believe that is a point which has to be made because, of course, the propaganda films show species that cannot be used by the trapper struggling in the trap. We have to emphasize just how rare that is.
I think that the Hon. Member for Cochrane-Superior also made the point very well as to the economic value of the nonfur part of the animal. I would say that it is no misrepresentation to say that all the trappers whom I have known respect the animals with which they deal. I say respect in terms of the aboriginal peoples' spirituality, the spirit of the animal that they are using, using because of their profound belief that the creator put the animals there for their use and that while the animals are used respectfully they will return. When they are abused, the animals go. This is something which runs through the legends of all the aboriginal peoples of Canada. That surely is the representation of the effects of successful conservation as practised by aboriginal trappers in the country since time immemorial.
Because of the shortage of time I must turn to the question of what will happen. The seal ban showed us what will happen. It showed us that the eradication of an economic base and the consequent deterioration of the social fabric of communities that depended upon that seal hunt constituted as an end nothing more than a cultural genocide of the people who were victimized, the people in the Arctic who were victimized by the eradication of that hunt. The people of Nishnawbe-Aski and the people of the Grand Council Treaty Three reserves whom I represent know that this could be the final straw, the final, destructive, demoralizing, alienating straw that would tell them that the people who came to their land, emissaries in a commercial sense of the European Market, have now seen them as having outlived their usefulness, and are preparing to discard them and to turn their communities into little more than welfare ghettos.
That is a consequence which I will always be determined to fight. I hope that all Members of the House will be determined to join me in that particular fight.
Fur Industry
The fragile economic base of these communities, the terrifying pace of change that they have seen will be doubled and redoubled if this sort of measure ever takes effect. In a community of my experience, Weagama Lake, it went from one plane a week to five planes a day in three years. They went from paths to roads in a similar period of time. The blows, the psychological impacts, the sense of being hemmed in that the people of Nishnawabe-Aski, the Cree, the Ojibway of the communities of Grand Council Treaty Three have had to endure will be doubled and redoubled if this sort of measure ever takes effect.
In summation, we must examine what we can do-because it is of only limited usefulness to fulminate-to spread the information. It is only of limited usefulness even to undertake educational campaigns within the European Economic Community. We have to come down to the hard pragmatic measures that will have some effect in blunting this initiative.
To do so we have to call upon the support of our largest trading partner, the United States. After all, the United States does export more fur than does Canada. While the fur industry is of lesser significance proportionately in the United States, as a whole it is indeed larger than the Canadian fur industry, which must come as a surprise to some.
Above all, we must try to take away the main ammunition and the main thrust which is being used by these animal rights advocates which is, of course, cruelty. I believe we can do that by continuing the excellent programs of trap replacement that have been started, and the very well supported, particularly by the trappers themselves, trapper education programs. We must reach out to the people who are proposing these regulations. We must expand and intensify our research in humane trapping methods. We must spend some money and make some effort to ensure that those who have the opportunity to decide on these matters are brought to Canada and shown the economic, the social, the cultural context, and also the techniques of humane trapping as it is fast developing in Canada today.
If we can take those measures, then I believe we do have some chance of blunting this initiative which, if it is successful, could have some very sad consequences and some very tragic consequences in the aboriginal communities of this country for whom the fur industry is still the economic mainstay.


Some Hon. Members:: Hear, hear!


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


Some Hon. Members:: Question.


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


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.
[Stage Direction]
Income Tax Act and Related Acts INCOME TAX ACT AND RELATED ACTS
July 20, 1988

[Stage Direction]
The House resumed, from Tuesday, July 19, consideration of the motion of Mr. Wilson (Etobicoke Centre) that Bill C-139, an Act to amend the Income Tax Act, the Canada Pension Plan, the Unemployment Insurance Act, 1971, the Federal-Provincial Fiscal Arrangements and the Federal PostSecondary Education and Health Contribution Act, 1977, and certain related Acts, be read the second time and referred to the Standing Committee on Finance and Economic Affairs; and the amendment of Mr. Garneau (p. 17724), and the subamendment of Mr. Boudria (p. 17770).
Mr. Bill Attewell (Don Valley East):: Mr. Speaker, during the debate on Bill C-139 many of my colleagues discussed how tax reform benefits individual taxpayers, but comparatively little attention has been devoted to another vital area of reform, corporate tax reform. Canada needs a reformed corporate tax system that is competitive internationally, more efficient and market-oriented, and fairer.
In the past, Canada's corporate tax system suffered from serious problems. Its capacity to raise revenues was seriously eroded over the years by a multitude of special tax deductions and other incentives. While each special preference was introduced to address a particular problem, the number of these breaks has enabled many profitable corporations to reduce their tax liability or pay no tax at all.
As a member of the Finance Committee I recall that the life insurance industry in particular paid little or no tax for the last 10 years. At one point in the hearings a chairman of the board of one of the largest companies, when questioned on whether or not the company paid tax, stated that it did not. When corrected by a vice-president he admitted that the company had received oil royalties and had paid a bit of tax on those. However, there are some sectors where the tax system has become totally unfair.
One of the problems is that the sheer number of incentives distorted market signals and led to inefficient uses of Canada's resources. It got to the point where tax considerations directed investments instead of sound business considerations. Again, if I could direct my thoughts back a few years to my former company where, from time to time, I worked on acquisitions, it was amazing how often the number one consideration when looking at a possible acquisition would be the tax situation. We did look at the type of services and the market share, but time and again the number one consideration would be the tax situation.
Our corporate tax system must remain competitive in an increasingly competitive world economy. Many of our trading partners have overhauled their tax systems to reduce tax rates and improve efficiency. Canada's general corporate tax rate was much higher than that of the United States and the United Kingdom. If we fail to narrow this gap, firms can arrange their operations to pay their taxes at lower rates to other countries rather than to Canada.
From time to time our Minister of Finance (Mr. Wilson) may have been criticized for moving ahead with this. I can
recall perhaps two years ago asking the Minister of Finance if he was going to move ahead with comprehensive tax reform. At that time his answer was that we were moving in that direction as a Government, but did not plan a comprehensive tax reform. But the world and realities change, and when the United States, in particular, moved ahead with its comprehensive tax reform, the Minister of Finance was wise to change his mind on that factor for the reasons that we have already touched upon.
Our proposals for reform of the corporate tax system will resolve these problems and achieve the three major goals we set out in the White Paper. First, profitable corporations will pay a larger share of the total tax burden. Corporate income tax will be a more predictable and reliable source of revenue.
Second, many special tax breaks will be eliminated or reduced. This will pay for the lower personal and corporate tax rates. It will return the profit motive to investment by rewarding success. It will encourage investment decisions based more on economic factors than on tax considerations. Certainly, some proposals of the previous Government went completely off the rails. I think particularly of the scientific research tax credit. When that was announced by the former Government it was believed that it would cost taxpayers something in the order of $200 million. We all know that that was poorly thought out, ill-conceived, and inadequately controlled to the point that the best estimate now is that this initiative will cost the taxpayers of Canada in excess of $3 billion. Some serious mistakes have been made. However, the Minister of Finance proceeds cautiously and carefully and he is making tremendous headway.
Third, corporate tax rates will be reduced. This will promote growth and job creation by maintaining a corporate tax system that is competitive with other countries.
There has been general support for the goals and the outlines of these proposals. We consulted extensively with the corporate sector and the public, and listened carefully to what they said. We considered all proposed modifications in the light of the goals of our reform, and as they would affect other elements of tax reform. We made some changes to improve the original proposals.
The rates of corporate tax are the same as those set out in the White Paper. Effective July 1, the general federal rate dropped to 28 per cent from 36 per cent. The small business rate fell from 15 per cent to 12 per cent. The rate for manufacturing will be phased down to 23 per cent by 1991.
The White Paper's proposals for broadening the corporate tax base will generally be implemented. While there will be fewer special tax preferences, not all tax incentives will be removed. The tax system will continue to recognize the importance of incentives for investment in resources, manufacturing, R and D, and small businesses, among others. The incentives that remain will be fairer and more effective in supporting economic growth and regional development.
July 20, 1988

For example, we improved our proposals on flow-through shares to ensure they remain an attractive investment vehicle and a benefit for junior resource companies; the proposed limitation on claimable investment tax credits has been increased to ensure that our tax regime for R and D remains among the most attractive in the world; and our proposal for capitalization of interest on vacant land will be modified so it does not affect small home building firms.
Concerns about the fairness of the system were aroused because of the number of profitable firms not paying tax. Our proposals, when fully implemented, will mean a substantial decline in the number of such companies. Tax reform will reduce by one-half the number of profitable corporations that pay no tax. Those that remain will either be firms in cyclical industries that have experienced significant economic losses in prior years, or will be firms in industries which receive incentives directed at important national priorities. These priorities include promoting regional development, ensuring a healthy and active resource sector, and encouraging research and development that will provide jobs for Canadians in the future.
A combination of a broader base and lower rates will produce more revenue, bringing the over-all tax system into better balance. Corporate tax revenues as a share of general tax revenues will increase from 15.6 per cent in 1987-88 to 17.2 per cent in 1991-92. In dollar terms, the federal corporate tax revenues will increase by about $5.5 billion over the next five years. That is approximately 10 per cent higher. Across the entire economy, corporate tax reform will strengthen the incentive for firms to invest in profitable ventures. The rate of tax on the return from new investment will be reduced. The tax treatment of capital will continue to encourage risk-taking initiative, growth and job creation. There will be less variation of tax paid by different sectors. Sectors which formerly paid below average taxes, such as finance and life insurance, will pay higher effective tax rates. Sectors that paid higher than average taxes, such as trade, services and construction, will pay lower effective tax rates. At the same time, the tax rate for small business will continue to provide a major incentive for entrepreneurs to create jobs and to promote economic growth.
The federal small business tax rate of 12 per cent is less than one-half of the tax imposed on large businesses. In addition, owners of shares in small businesses will also benefit from the full $500,000 exemption in capital gains on these shares, to reward success in private entrepreneurship.
Corporate tax reform is a key element of the Government's over-all plan to position the Canadian economy and to take
Income Tax Act and Related Acts
advantage of the opportunities in the 1990s. I urge all Members of this House who want to see a stronger Canadian economy to vote with me in favour of Bill C-139.
Just before closing, if I might touch on a couple of other points, let me say that it is vitally important that we get on with this legislation. Those people involved in tax planning and running business know that one of the big problems on something like this is delays and uncertainty. We must get on with this so that people can plan confidently and not be wondering continually when this legislation might be passed.
I think that the confidence of our Finance Minister, as I mentioned earlier, grows by the day and by the month. We have here a Finance Minister who in the past three years has made projections of what the deficit would be. Every single year of the last three has come in on or under the projections. This latest one will be something like $1 billion lower than forecast. A lot of Canadians would not realize this, but that is the best three-year record in 45 years.
I think we have tremendous confidence in this Minister. Let us get behind him, let us get this legislation passed, and let us get on with the increases that will occur in the corporate sector, to help provide lower taxes for the consumers.
We know that four out of five consumers will be paying less tax, and nine out of 10 seniors will be paying less tax. This is a great over-all package. People will nit-pick on certain aspects of it, but on balance it is a super package, one that a lot of Canadians will benefit from, and I think we are moving in a very excellent way to a fairer system.


An Hon. Member:: Hear, hear!


Mr. Deputy Speaker:: Questions and comments. The Hon. Member for York Centre (Mr. Kaplan).


Mr. Kaplan:: Mr. Speaker, I wonder if the Hon. Member would be willing at least to acknowledge that what appears to be tax reductions that are contained in the Bill before us really do not, when looked at over the picture of tax increases of low and middle-income Canadians over the last four years, give back to low-income Canadians the amounts that this Government has taken away from them in the whole four-year picture.


Bill Attewell: Mr. Speaker, of all Parties to start trying to slow down this Bill, that should be the last Party. It is the Party that put us into a deficit situation year after year, so much so that now the entire deficit of $29 billion to $30 billion is devoted not to reducing the debt but devoted 100 per cent to paying the interest on that debt.
Now, let us have our focus on moving ahead. I have described the package in the corporate sector, certainly. There is a lot being done. We must get on with the business and eliminate the uncertainty that exists out there. I will quote the following from The Globe and Mail issue of April 25th:

July 20, 1988
Income Tax Act and Related Acts
If an election were called before stage one became law, tax reform would die
and the current system would stand until new legislation was introduced.
That would create chaos. "I hope Brian Mulroney isn't irresponsible enough
to call an election before the bill gets through the House."
The person who made that comment was the Liberal finance critic, Raymond Garneau.


Robert Phillip Kaplan: Mr. Speaker, I think it must be obvious to everyone in this Chamber, including the large crowd in the gallery, that the Hon. Member made no reference at all to my question in the statement that he just made, or any attempt to answer it or to explain away, which I thought he might do, the point that I tried to make. I called on the Hon. Member and asked him to recognize that the reductions that are contained in Bill C-130, for most Canadians, lower and middle-income Canadians in particular, do not restore the tremendous tax increases that those very groups have sustained since this Government took office four years ago.
I know that there was a deficit to deal with and that it is a legitimate option to increase taxes. I am calling on the Member to recognize that the taxes that have been increased are not the taxes that are on the richest in society, on the highest income earners. The taxes that have been increased are on the lowest earners and middle-income Canadians.
I call on the Hon. Member to admit that this is the case, at least out of a sense of honesty.


Bill Attewell: Mr. Speaker, Canadians are going to get a chance to judge fairly quickly what this Government has done.


An Hon. Member:: Hear, hear!


Bill Attewell: It has been a great package in total.


An Hon. Member:: They cannot wait.


Bill Attewell: They are going to see that four out of five Canadians are going to be paying less tax, and nine out of 10 seniors will pay less tax. Some sectors are finally going to be paying their share. I mentioned that some people might try to slow down this package in certain isolated areas, but in total I can only stress again-and you mentioned people watching this in the gallery and elsewhere-I know that they will be, but I know that they are also examining our record as a Government, the record of the Finance Minister, which I will just highlight again.
It is the first time in 45 years that we have had three successive projections of being on or below the forecast. That is a responsible performance compared to the totally irresponsible performance of the Liberal Government. I can remember the Liberal Government adjusting its projections on deficits by the week, not too many years ago. I think it is pretty clear in which Party, in which Government the people of Canada are going to have their confidence. They are not going to return it back to the irresponsible bunch that they had for about 16 years.


An Hon. Member:: Hear, hear!


An Hon. Member:: Time for a change.


Michael Morris Cassidy: Mr. Speaker, I will say a few words to the Hon. Member who sits from time to time on the Finance Committee and who does his work there. In a sense I think that there is something wrong with the Conservative tax reform. It seems to suit the residents of the Hon. Member's constituency perhaps more than the average Canadian. Is it fair to have a so-called tax reform which winds up leaving only one group among Canadians paying less tax on their income than they paid in 1984, namely people who are earning more than a $100,000 a year? Is it fair to have a tax system which will leave the corporate share of tax revenues to the Government of Canada, to drop it down to 17 per cent in 1991, which in fact is lower than the 20 per cent share that corporations paid of tax revenues in 1984? When the Conservatives came to power, corporations were paying a larger share of federal revenues than they will be paying in 1991, after this particular and so-called tax reform is mature.
Perhaps the Hon. Member could say whether it is fair to have tax reform which will give tax cuts of only $140 to poor people earning under $15,000 a year but which, according to the Government's own figures, will give a tax cut of some $4,165 on average to three out of four families earning over $100,000. Is that fair? Is that just? Could the Hon. Member take those facts into a pub in Kamloops or Newfoundland and defend that? Could he take that to a group of families and justify the unfairness of a system where the tax credit which people get if they have children is the magnificent sum of only $65 a year? Is that fair? Could the Hon. Member say, if he agrees with me that these things are not fair, why the Government is going ahead with a tax reform which essentially is unfair to families, unfair to average Canadians, and fair only to the rich and to corporations?


Bill Attewell: Mr. Speaker, the system we are recommending, the package, I say is fair. The Hon. Member for Ottawa Centre (Mr. Cassidy) has been on the Finance Committee. I have been on it for almost four years now. We have had a tremendous amount of consultation and have done a lot of research. Our committee visited Washington. Every aspect of this package has been thoroughly looked at and analysed.
Let me highlight again some of the benefits and who will be paying less. Income taxes will be reduced for 9.7 million households, over 85 per cent of all households, by an average of $490. About 850,000 lower-income Canadians will have their income tax reduced to zero or will receive refundable credits. In other words, they will be coming right off the tax rolls. Income taxes will be cut for about 1.3 million of the 1.4 million households which have at least one person in them aged 65 and over. About 250,000 elderly Canadians will have their income tax reduced to zero. Personal income tax will be lower for all ranges of income. Most taxpayers whose income
July 20, 1988

consists primarily of salary or wages, family allowance or standard pension and retirement revenue will receive tax reductions. Last, net personal income tax revenue to the federal Government will be reduced by about $12 billion, not $12 million but $12 billion coming off the personal side. I say that that is a giant leap in fairness.


Michael Morris Cassidy: Mr. Speaker, I have to say that it is a giant leap backwards. When I talk to my constituents and to average Canadians and ask them what they think about this tax thing, whether they think this tax reform is a good idea, the reaction I get is: "You know, I am not sure what it is, but I am not seeing as much money at home as I was four years ago. I am not sure where it is going, but I know it is going".
This is a product of two things, Mr. Speaker. On the one hand, real incomes of Canadians have not been rising. On the other hand, the bite of the tax collector has been increasing on those average Canadians. As we calculate it, it is an average of $ 1,500 or so in tax increases on the average Canadian with an income of perhaps $30,000 or $35,000 a year since 1984, and tax reform will give about $300 or $350 back. If you have to give up $4 and you get $1, you are not better off; you are worse off. It seems to me that that is the situation which prevails with tax reform. The Government will say: "Look at last year and look at what is happening this year". The Government will ignore the consistent pattern of tax increases on average Canadians imposed by the Conservatives at the same time as they cut taxes on wealthy Canadians by the capital gains exemption and stuff like that.


Mrs. Mailly:: And the farmers.


Michael Morris Cassidy: I would correct the Hon. Member's recollection as well. In committee when my colleague from Regina West and I raised the question about the rates and asked "why are we giving such cuts to people who are wealthy and doing so little for people on average incomes", the chairman simply said: "We are not discussing that here", and we went on to something else. My colleague and I had two choices. We could have either co-operated on the areas where the Finance Committee was able to co-operate productively, or we could have simply walked out and said: "This is a Tory show". We were constructive and chose to participate. I think the committee made some constructive suggestions, but in this area we were completely excluded from the game.
I am really surprised at my hon. friend from Don Valley suggesting that this was looked at. It was not looked at all. It was on the Tory agenda that the Conservatives wanted to give very large tax cuts to wealthy Canadians, a sharp reduction in taxes for many corporations, and to do that with a small cut for average Canadians, which is far less than the increases in tax they have had since 1984.


Mr. George Baker (Gander-Twillingate):: Mr. Speaker, I have a few words concerning this very extensive Bill. I have listened to Hon. Members argue about who is responsible for this tax increase or who is responsible for that tax increase. I
Income Tax Act and Related Acts
have heard them argue that there was not a tax increase, there is not going to be a tax increase, there is going to be a tax decrease, or there is not going to be a tax decrease. For those of us who help people in our constituencies fill out their income tax returns, one thing is obvious. People are paying more income tax as the years go by than they did in previous years.
If you took the last four years and filled out the income tax returns for the same person, you would discover that the individual is paying more income tax as each year goes by. I do not know where Hon. Members are getting all these facts and figures about people paying less income tax. All I can see is that they are paying more income tax.
I suppose there are only two groups of people. I was thinking about this as I was glancing at some portions of the Bill a few moments ago. One group are millionaires. Of course I do not fill out income tax returns for millionaires; I do not know any. In the place from where I come on the northeast coast of Newfoundland we do not have any millionaires sitting around doing their income tax. They would not fill them out anyway. They would have a chartered accountant do it.
I want to make an honest to goodness logical suggestion for the Government of Canada on this one point about income tax.
I have here in my hand a list of some 200 communities in Alberta, about 600 communities in British Columbia, about 400 communities in Newfoundland, and so on. This year these communities qualify for a new tax break. Granted, some of the communities are pretty small. If you live in these communities you will probably gain, if you pay taxes, about $2,000 to $2,500 on your income tax return when you fill it out. I noticed that some of the communities do not have anybody living in them. There is a community in Newfoundland called Exploits. Only two people live in Exploits. They are Richard Wells and Lydia. They have lived there all their lives. Richard is a pensioner. Also, some of the communities are quite large. If you examine the list here, you will find that there are perhaps 50 communities in my federal riding.
The Minister stood in this House the other day and spoke about fairness in taxation. He spoke about the fact that the Government of Canada has brought fairness into the tax system. It is a funny thing, but I noticed that some communities which have now been listed for northern benefits are on the border of Canada and the United States. Some communities listed for northern benefits are in southern Newfoundland, but there are none listed in northern Newfoundland. This tells me that there is something drastically wrong with the regulations the Government has brought in.
Granted, this is a very difficult situation. You know what I am talking about, Mr. Speaker, because you know about that northern section of Quebec and the Gaspe coast where a great many of these communities are located. It is very difficult to come up with criteria for the tax law as it relates to deductions

July 20, 1988
Income Tax Act and Related Acts
being administered fairly. In other words, how do we define an isolated community?
We do not define an isolated community the way the Government of Canada did a few days ago, that is, by saying that everything above the 55th parallel is isolated and everything below the 55th parallel is not isolated. It does not make much sense to have the entire Burin Peninsula and the entire south coast of Newfoundland getting benefits while the islands up North do not get them.
The Government of Canada, though it has appointed a commission of inquiry to look into the matter, could have come up with a more sensible way of distributing these benefits than jt has. It has sent to each person living in those communities a special form to fill out to see if he or she qualifies. Looking at the communities and areas that qualify, one would have to say that the person who made up that list really used no common sense whatsoever in determining what was isolated and what was not. The commission of inquiry, as I understand it, is starting its hearings in Newfoundland next week.
There is another clause in the Bill that I want to comment on. That is the clause that deals with the Unemployment Insurance Act. The Minister, in his wisdom, has brought in an amendment to the Unemployment Insurance Act here dealing with amounts of money owed by the employer to the Receiver General for Canada, the Government of Canada. The Government is now imposing a penalty on the employer. The penalty is as follows: the employer shall pay to the Receiver General that amount computed from the day on which it was owed to the day of the remittance of the amount to the Receiver General for Canada, and the normal interest rate shall be charged.
If the Government is going to amend that Section of the Unemployment Insurance Act, surely to goodness it should have then revised the penalties that apply to the recipients of unemployment insurance benefits when that same Section is in violation. Let me tell Hon. Members what that is under this particular Section of the Unemployment Insurance Act. The recipient of unemployment insurance would have to have his unemployment insurance reduced over a period of time to satisfy the debt owed the Crown. The employer, in the case of uninsurability, gets no penalty whatsoever except that he gets back the money that he paid in.
The Government of Canada, in changing the law as it relates to Subsection 68(6) of the Unemployment Insurance Act, 1971, certainly should have addressed the problem in relation to the recipients of unemployment insurance as well as the employers. As I say, the principle of fairness in the Unemployment Insurance Act goes out the window when one examines the Northern Benefits and Isolated Posts Act. It goes out the window because I do believe that politics came into play very recently when some Members in this Chamber got a hold of two Ministers and had whole areas designated as being eligible for these particular allowances.
The Bill itself also amends the Post-Secondary Education and Health Contributions Act, 1977, and the Federal-Provincial Fiscal Arrangements Act. I do hope that more Hon. Members will address these very important subjects as the day goes on.


Michael Morris Cassidy: Mr. Speaker, I am just curious. I know that the Hon. Member has been here before, and I know that the Liberal Party has been critical of the Government because of a tax reform which favours too much the rich and wealthy corporations.
I seem to recall that back in 1981, when Senator Mac-Eachen was the Minister of Finance, the Liberal Party came in with a Budget which was ostensibly meant to broaden the base and at the same time lower the tax rates for wealthy Canadians by a substantial amount. I seem to recall as well that after a good deal of pressure from the business community and other friends of the Liberal Party, the loophole plugging exercise, the broadening of the base that was meant to take place, was in fact reversed. At the same time, the Liberal Party did not put back up to previous levels the reductions of taxes for wealthy Canadians.
I also recall that when the Liberals were in power, beginning with the present Leader of the Liberal Party, in fact, there was a series of measures which had the effect of reducing the tax burden on corporations through accelerated depreciation and various other types of allowances which, among other things, led to an enormous piling up of deferred taxation on the part of the corporate sector, to an erosion of corporate tax revenues and to many of the injustices in corporate taxation which average Canadians have been so concerned about.
My hon. friend comes from a part of the country where that kind of thing really is not very tolerable because there are not many wealthy Canadians in his constituency. How is it that he was able at that time to let pass without comment the fact that the Liberals were reducing taxes on the wealthy just as the Tories are reducing taxes on the wealthy today, and that the Liberals were reducing taxes on corporations, just as the Tories are reducing taxes on corporations today? Perhaps the Hon. Member can tell us if there was any difference between the Liberal Party at that time and the Conservative Party today, because I cannot see very much difference.


George Baker: Mr. Speaker, I can remember when the NDP- no, I cannot remember when the NDP formed the Government of Canada. It is very difficult to follow the hon. gentleman's logic. For the past four years, the hon. gentleman has been blaming the Conservative Government for drastically raising taxes on everyone, and he has been saying that prior to that the Liberals were drastically increasing taxes on everyone. The Hon. Member knows full well, however, that as far as federal income taxes are concerned, income taxes for ordinary Canadians took a fairly substantial drop in years prior. When I say "substantial", I mean that when a person filled out his income tax form at least he got a little more. I am talking
July 20, 1988

about the average Canadian, and by "average" I mean average in my riding.
What is average in my riding? Average in my riding is $8,000 or $9,000 a year. The Hon. Member does not know very many people who make $8,000 or $9,000 a year, I am sure. He does not represent fishermen. He does not represent the primary producers of Canada. He knows a lot about the corporate sector and what taxes it is paying.
I do not know anything about the corporate sector. All I know about is ordinary, producing Canadians. When the Liberal Government was in power, ordinary Canadians were the primary concern. I have seen incredible changes take place in the past four years since the Conservatives have been in government. Most of them have been to the detriment of these primary producers, these average Canadians who pay through the nose, day in and day out.
These average Canadians do not know, and I am afraid that I must claim some ignorance here and say that I do not know, what is the corporate tax structure. I have not got a clue. I do not know what happened under the Trudeau regime with corporate taxes. All I know is that ordinary Canadians benefited greatly under the Liberal administrations year after year. All I have seen in the last four years has been programs disappearing. All the assistance programs have disappeared. Look at all the insurance programs for fishermen; they were thrown out the window. All the assistance programs for boat building were thrown out the window. Why? Perhaps it was because they went against the wishes of the United States of America.
However, I can assure the Hon. Member of the NDP, the people who back in the mid-1970s supported the International Fund for Animal Welfare to get rid of the seal hunt, that under the Liberal Government the ordinary Canadians, the producers of Canada, are always looked out for first and foremost, not like under this present regime.


Mr. Horner:: Oh, George, I don't believe you said that.


Michael Morris Cassidy: Mr. Speaker, while I have great respect for the Hon. Member, and while I know he speaks out for his constituents, there is a kind of blindness on the part of members of the Liberal Party, particularly when they are in government.
I have done a bit of research on this question. It does not affect Newfoundland directly, but it affects people with very modest incomes living in the east end of Montreal. I wanted to find out what was happening and who was speaking on their behalf between 1980 and 1984 when the Liberals were in power. I took the trouble to look at the legislative and parliamentary record of the Hon. Member for Montreal-Sainte-Marie (Mr. Malepart) who is well known here as a voice of the people, at least oyer the last two or three years. During the time that Montreal's economy was going down the drain, when
Income Tax Act and Related Acts
basic industries were shutting down almost every day, the Hon. Member for Montreal-Sainte-Marie did not say a word. This man, who was such a defender of the rights of pensioners when the Conservative Government tried to deindex pensions in 1985, actually spoke up for deindexing public service pensions when the Liberal Party brought in the six and five program two or three years earlier. Yet there was not a peep, not a word was heard from him about Montreal.
It seems to me the problem with Liberal Members coming from poorer parts of Canada is that they walked on the other side of the street. They turned a blind eye when the Minister of Finance of the day cut tax rates on wealthy Canadians from over 60 per cent to the levels that prevailed before the Conservatives came to power. They turned a blind eye when the Government brought in accelerated depreciation schedules and other tax devices which made the whole tax fraternity and the corporate sector jump with joy.
The Hon. Member says he does not know anything about corporate taxes or accelerated depreciation. He had a responsibility to know about those things because during the time the Liberals were in power they were bleeding Canadians dry by putting so many tax breaks in the hands of wealthy Canadians and corporations. They did not take all the benefits away from average Canadians. What they did instead was run up the deficit in order to give those privileges to wealthy Canadians. That is a policy which tries to benefit everyone at the same time, but it led the country close to bankruptcy.
That is why I ask the Hon. Member why he and his colleagues were not vigorously on their feet to condemn the Government of the day in 1980 when its major priority for taxation seemed to be to cut taxes on the wealthy, just like the Conservatives today.


George Baker: Mr. Speaker, I must say that accelerated depreciation is certainly not a major subject of importance in my riding. It certainly was not an election issue. Accelerated depreciation?


Iain Francis Angus: That sounds like growing old fast.


George Baker: Yes. That is certainly not a subject of any great importance in my riding. However, I would certainly welcome the NDP running a campaign on it in Newfoundland. I would certainly welcome that kind of competition. Accelerated depreciation!
The Hon. Member is probably correct in one thing. That is, you will always be able to look back on what the Conservatives did and what the Liberals did, but you will never be able to look back on what the NDP did.


Some Hon. Members:: Hear, hear!


Mr. Deputy Speaker:: Resuming debate. The Hon. Member for Burnaby.


Carlo Rossi: The people don't want the NDP.

July 20, 1988
Income Tax Act and Related Acts


Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, the people will certainly be making a clear decision in the next election, and it is about time that we had a real change from the worn out and discredited policies of the Liberals of the past and those policies of the Conservatives of today. The people of Canada are going to vote for New Democrats and a Government led by the Hon. Member for Oshawa (Mr. Broadbent). That is what is going to happen in the next election, and we are looking forward to it.


Carlo Rossi: You are a bunch of bluffers.


Svend Johannes Robinson: Mr. Speaker, I am pleased to rise to participate in the debate on what the Government calls tax reform but which is in fact nothing of the sort. Instead of reforming the tax system in a meaningful way, it shifts the burden to the poor and powerless from the wealthy and the corporate elite. That is the effect of Tory tax reform.
I want to make it very clear that in the next federal election, and we say the time for that is now, the people should have a right to speak out on the record of the Government and voice their concerns about the proposed trade deal. A central theme for New Democrats in that election will be the question of fairness. What area of government policy is more lacking in fairness than the tax system?
What we are seeing with Tory tax reform is a move by the Government away from a progressive tax system, to a system in which, rather than taxing people on income, it is going to be taxing people on consumption. The Minister of Finance (Mr. Wilson) says that is all right because people choose whether or not they want to buy goods or services. What kind of unreal attitude is that? Tell a poor family, a single parent family, that they can choose whether or not to buy shoes and clothes for their children, that they can choose whether or not to spend money on housing, that they can choose whether or not to buy essentials to provide for their family. Of course that is nonsense. By moving from taxation of income to taxation of consumption the Government is moving away from progressive principles in the tax system.
As New Democrats we have clearly identified a number of important areas in which the Government should be tightening loopholes and increasing the progressive nature of the system. I want to pay tribute to my colleague from Ottawa Centre and my colleague from Regina East who have done such an outstanding job in committee and across this country in drawing to the attention of Canadians the unfairness and inequities in our tax system. In the four years of Conservative rule the share of taxes paid by the corporate sector has gone down from approximately 20 per cent in 1984 to some 15 per cent this year. Who is paying more in taxes? Of course, it is low and middle-income earners. That is the nature of Tory tax reform.
The Minister of Finance boasts that 850,000 Canadians are going to be removed from the tax rolls. He neglects to mention
that under four years of Tory rule over one million Canadians were added to the tax rolls. This kind of cynical shell game is obviously not going to wash with Canadians.
I have received extensive correspondence from my constituents in Burnaby on the unfairness of the Government's proposed tax reform. I want to share a couple of those letters with members of the House and those who are watching these proceedings across the country.
I received a letter, for example, from an 85-year-old constituent, Mr. Eric Button in North Burnaby. He wrote to me as follows:
Dear Svend:
Thank you for your latest Ottawa update. I enjoyed reading it.
In the last paragraph on income tax you did not mention the great change in the 1986 schedule over that of 1985. It seems to me that a multitude of poor people will be paying income tax this year. This will be the first time in 20 years that I have paid a tax ... We have always lived during our retirement time below the Government's poverty level.
He asked for an explanation. Why is it that for the first time in 20 years this elderly gentleman and his wife, who are struggling to survive on an income which is below the poverty line, are paying tax? He included copies of the schedules from the 1985 and 1986 tax tables. I examined them and, sure enough, under the Conservative Government taxes have in fact gone up substantially for the poorest in our society, including senior citizens.
I suppose we should not be surprised at that. After all, it was this same Government that attempted to deindex the pensions of senior citizens. It was only the angry outcry of seniors from right across this land that forced the Government to back down.
It is not surprising that a very respected national Seniors organization, the one voice: Canadian Seniors Network, in their response to the Government's White Paper on tax reform was severely critical of the proposals of the Government. They note that the fundamental principles of fairness, accountability, and stability are ignored when it comes to the proposals of the Government in the area of tax reform. We, as New Democrats, do not accept that.
We say that there is something very wrong with a tax system in which, in 1985, for example, 8,000 Canadians who made more than $50,000 paid not one penny in income tax. We say there is something wrong with that system. We say there is something wrong with a system in which, in 1984, over 1,400 people who had incomes in excess of $100,000 per year did not pay a penny in income tax.
We as New Democrats believe that the income tax system should be an important mechanism for the redistribution of income. We do not accept the philosophy of the Fraser Institute, for example, which suggests that we move to a flat rate system of taxation.
July 20, 1988

Under four years of Conservative Government we have seen an erosion of the fundamental principles of progressive income taxation and a very clear shift from income taxation to taxation on consumption. That shift is profoundly regressive and clearly attacks the poor in Canadian society.
The tax system should be used to redistribute income and wealth in our society. There is something fundamentally immoral about a society which is prepared to accept the fact that over one million of our children are poor while saying that some 8,000 individuals who make in excess of $50,000 a year have to pay no income tax whatsoever. There is something immoral about an economic system which condemns 700 children in the City of Vancouver and the municipality of Burnaby, which I have the honour to represent, to go to school hungry while the Government refuses to bring forward changes in the tax system which would ensure that such poverty is eliminated.
The same Government that refuses to tackle tax reform is prepared to spend in excess of $8 billion for nuclear submarines. What kind of madness is it that a Government is prepared to waste this kind of money? In fact, as my colleague from Winnipeg-Birds Hill points out, it is well in excess of $8 billion. In 1986 an estimated 102,000 Canadians were homeless. We want to spend $8 billion on nuclear submarines while people are homeless and hungry? As New Democrats we profoundly reject that.
What exactly does Tory tax reform mean and who does it benefit? Let us look at the figures. The most significant change under the tax proposals of the Minister of Finance is the reduction in the top tax rate on the highest income earners. In fact, the highest tax rate will drop from 34 per cent on incomes above $63,000 to 29 per cent on taxable incomes exceeding $55,000.
At the same time as the top tax rate is dropping the bottom rate is increasing. We are left with a situation, when provincial income tax is added in, in which the current top rate of 51 per cent is going to drop to 44 per cent but the bottom rate is going to increase from 9 per cent to 25 per cent. That is Tory tax reform-lower the marginal rates at the top and increase the marginal rates at the bottom. There is no sense of fairness or justice whatsoever.
It is interesting as well to consider the timing of these tax proposals. The tax reductions, of course, took effect on July 1 of this year. That meant a slight increase in the take-home pay of some employees. It is not entirely coincidental that this should be taking place on the eve of a federal election.
While there may be a slight decrease in taxes and a slight increase in take-home pay, the reality is that since 1984 a series of Conservative tax measures have increased sales and excise taxes substantially. The Government has taken literally hundreds of dollars out of the pockets of Canadians that it is now saying it is going to put back in the form of income tax reduction. We do not accept this. We do not accept so-called tax reform in which, as an example, a stockbroker who earns more than $200,000 a year is going to save $15,000 in tax while the Government continues to tax people who live below
Income Tax Act and Related Acts
the poverty line. That kind of so-called tax reform is completely unfair.
We say as well that it is time the Government took a serious look at tax expenditures in Canada. We have called for an annual review, an accountability of these tax expenditures which add up to in excess of $30 billion. Imagine what we could do with that money for social programs, post-secondary education, housing, and the environment. However, the Government refuses to consider that.
We have said that it is time that this country looks seriously at the taxation of capital gains. Why is it that 50 per cent of capital gains are exempt from taxes? The Government is now saying that it will move to tax 75 per cent of capital gains, but why do we not recognize that capital gains should be taxed just as any other income is taxed?
As long ago as 1967 Carter said it well "a buck is a buck is a buck". For that reason we, as New Democrats, have said that capital gains, aside from small businesses and the family farm, should be taxed fairly, just as is the income of those who work on an hourly and monthly basis. Why should those who earn their income from speculation in land, for example, be taxed at a lower rate than those who are employed? For that reason we have called upon the Government to recognize that it should be taxing capital gains as other income is taxed with the exception, as I said, of small businesses and family farms.
According to the proposed tax reform, the share of corporate taxation has gone down. Let us consider some of the rationale for this proposal. Why has the Government refused to tackle this question of capital gains? In 1984, the 1 per cent of taxpayers with incomes in excess of $100,000 received 30 per cent of all capital gains. Why are they not taxed fairly? That would reduce the burden on low and middle-income earners. Yet the Government is not prepared to take that step even though the Reagan Government in the United States has moved to tax capital gains at full rates, just like ordinary income.
The Government huffed and puffed about corporate taxation and suggested that it would make significant moves to increase the level of corporate taxation. However, it has done nothing of the sort. Since it took office in 1984, corporate taxes have increased 8 per cent, income taxes have gone up by approximately 45 per cent, and sales taxes have increased in excess of 67 per cent. That shows where the Government's heart really is. It is looking after its friends in the corporate elite and continuing to hit hard on low and middle-income earners.
What are the rationales for this so-called tax reform? Why has the Government not taken serious action? The Government says that by reducing the number of tax rates from 10 to 3 it will reduce the complexity of the system. What nonsense. The number of steps in the tax schedule has no bearing whatsoever on simplification.

July 20, 1988
Income Tax Act and Related Acts
It goes without saying that New Democrats have called for a more easily understandable tax system. The reality is that by reducing the top level of taxation from 34 per cent to 29 per cent, the Government is simply reducing the amount it will be collecting from the wealthiest in our society. Why should a secretary at Bell Canada who earns $28,000 pay a marginal tax rate that is only 5 percentage points below the rate paid by the chairperson of Bell Canada, Jean de Grandpre, whose salary last year was $977,300. Is that fairness? Is that a fair, equitable and just tax system? Of course not.
We believe that instead of lowering the marginal rate for the wealthiest and most affluent in our society, that rate should be increased to enable us to pay for the social programs that we value in this country.
That brings me to another rationale of the Government in this so-called tax reform. It says that tax reform will make us more competitive with the United States. I must question that. The United States has an estate tax which Canada has not had since 1971. Furthermore, we as Canadians value what makes us a distinct society. We value safer streets. We value a publicly financed hospital and health care system. Indeed, it was the NDP and CCF, with J. S. Woodsworth and Tommy Douglas, that pioneered these health care programs. We value a greater public role in the area of financing of post-secondary education, in transportation, and in communications. Canadians are prepared to pay the cost if our tax system is fair.
The Government's argument that we must lower these rates to bring them more in line with American rates is part and parcel with its approach to Canadian society, which is best exemplified in the trade deal. That deal, if it is ultimately implemented, will result in Canada in many ways being transformed into something like a fifty-first state. It will erode our social programs and destroy our sovereignty, resulting in far greater levels of unemployment. We as New Democrats are pledged to fight that deal with every ounce of energy we have.
Another rationale of the Government is that the upper level of taxation should be reduced because no one pays at those upper levels in any event. If that is the case, surely those loopholes should be closed. Rather than lower the upper marginal rate, close the loopholes that allow people who are making in excess of $100,000 to pay no income tax whatsoever. That is a more sensible approach than simply lowering the upper level of taxation.
Another argument made by the Government is that higher tax rates breed inefficiency. Japan is often cited as one of the most productive economies in the world. It has a top tax rate of 80 per cent. Sweden, which has a very high growth economy, has a top rate of 88 per cent. Studies have shown that high tax rates have little effect on productivity.
In bringing this proposal forward, the Government still has not moved to implement a minimum tax on its friends in the corporate sector. Even Ronald Reagan has taken such steps in the United States, and in excess of $2 billion in revenue has
been raised as a result of the minithum tax on the corporate sector there.
The New Democratic Party agrees that loopholes were opened by the Liberals during their term in office. We would have hoped that the Tories would have closed those loopholes and moved to a fair, just and equitable tax system. This tax reform is nothing of the sort. That is why in the next election Canadians will turn not to the Liberals, not to the Conservatives, but to New Democrats for a tax system which is fair and equitable.
[ Translation]


Claudy Mailly: Mr. Speaker, the Hon. Member's heart is in the right place. He is right when he says there is something immoral about our society when we see Canadian children w'ho come home at the end of the day and have to go to bed hungry and who get up in the morning and go to school hungry. These problems are caused by poverty, and it is true that they are a blot on this wealthy society of ours. However, the answer is not tax reform but a family policy that will help these children. These problems are caused by the lack of a comprehensive family policy that would include a housing policy, providing decent, affordable housing SO that at the end of the month, parents would not be in a situation where they don't have enough money to make ends meet and give their children the food they need.
On the other hand, since the Hon. Member mentioned that the sales tax is a regressive tax, I would like to point out to him that we felt that a tax reform was necessary because we had reached the point where the only way we could get the money to upgrade programs to help the poor was to increase sales tax, because we could no longer increase personal income tax.
The tax burden on Canadians was undermining job creation, so a tax reform was necessary but we also had to make sure that we could get revenue from sources other than sales tax. These are the two aspects of the reform: income tax and sales tax.
As far as sales tax is concerned, we have introduced a credit to compensate people at the bottom of the financial ladder, a $50 credit for all Canadians. So an effort has been made, but the tax reform must be carried out. The Hon. Member may not agree on ideological issues or on the procedure, but our purpose, Mr. Speaker, is to provide some relief for Canadians who are overtaxed, and we want to do so by finding sources of revenue so that the Government can upgrade programs that deal with the problems of the poor, whether they are children, adults, or senior citizens. Sixty percent of the women over 65 in Canada are poor. So would he not agree that something had to be done and that we are taking this approach for a very good reason? And as far as capital gains are concerned, this also covers farmers, who are not wealthy people. I don't think he should blame tax reform for the problems caused by poverty which have been with us for quite some time.
July 20, 1988


Svend Johannes Robinson: Mr. Speaker, I find the Member's observation absolutely unbelievable. First of all, she does admit that the sales tax is regressive, does she not? So if it is a regressive tax, as the Member says, why have the Conservatives increased the level of that sales tax since 1984? Why, Mr. Speaker, have they increased the sales tax twice, if it is a regressive tax? The Members admits that, Mr. Speaker, and I find it unbelievable that she now says that there is no another way of obtaining the necessary money. There is another way, and it's quite plain to see. Why have they not taxed corporations, in the interest of fairness? Why, Mr. Speaker, have they not taxed corporations instead of increasing the sales tax every year? That is what I do not understand.
For instance, Mr. Speaker, the Minister of Finance (Mr. Wilson) has in fact removed $3.1 billion from the tax system. The 2 per cent of Canadians with the highest incomes will receive $379 million, but the 26 per cent who are among the poorest of Canadians will only receive $257 million. And there you have Conservative tax reform!
Finally, Mr. Speaker, the Members ask me why we must use the tax system to reduce poverty. We New Democrats believe that the tax system can be used in a fair way to finance social programs, for instance, programs to help poor children, the homeless, and the elderly who are grappling with poverty. We think we can use the tax system and the money obtained by way of it to improve our social programs in a fair way. The Conservatives will not recognize that reality, and instead they help their friends in the corporate sector, in the corporate elite, and because of that the Canadian tax system remains unfair.


Robert Phillip Kaplan: Mr. Speaker, when I saw the Flon. Member for Burnaby (Mr. Robinson) rise in that beautiful red Liberal tie, I thought he was at least going to say some kind things about the Liberals. However, he began by indicating that the next Government would be a New Democratic Government. In the light of that, I think it is worth taking seriously the proposals he said would be part of New Democratic tax reform.
He indicated that capital gains would be taxed at full rates. This, of course, is tragic news for many senior citizens whose savings include Bell Canada stock which they have held for 20 and 30 years in some cases and will all be taxed in one year.


Michael Morris Cassidy: Conrad Black's parents?


Robert Phillip Kaplan: I wanted to ask the Member about the small business and family farm exemption. Under the New Democratic tax system, he said, that although capital gains would be taxed fully the family farm, and small business and the family-owned business, would not be taxed at the regular capital gains rates which the NDP would impose. 1 think it is important, if those Members are proposing that a New Democratic Government be created in the next election, for us to know exactly what these exemptions are.
Income Tax Act and Related Acts
After all, the Hon. Member for Ottawa Centre (Mr. Cassidy) referred to his great friends, Conrad Black and family. Perhaps Argus Corporation is a family company in the definition of the New Democrats, or some of the largest farms in the country owned by one family. Are they to be totally exempt from capital gains tax under a New Democratic Government?
In a nutshell I am asking for more details about the exemption which will apply to family farms and to small family-owned businesses under New Democratic tax reform.


Svend Johannes Robinson: Mr. Speaker, it is not surprising that a Liberal front-bencher should rise and be somewhat sensitive in the area of tax reform, particularly someone who has been around since 1968. It was the Liberal Government that was responsible for introducing loopholes into the tax system in this country that resulted in the loss of billions of dollars in tax revenue.
Some of us remember the scientific tax credit. Some of those Members will remember the research tax credit. Those great managers of the economy brought forward this boondoggle that resulted in the loss of literally billions of dollars. It is not surprising that the Member from one of the York constituencies would rise and raise concerns.
The reality is that when we look at the question of capital gains exemptions we must look at who in fact benefits most from these exemptions. I have made it very clear that the exemption for the family farm and for small businesses will continue, but let us look at who it is that benefits from capital gains. In 1984, the 1 per cent of taxpayers with incomes above $100,000 received 34 per cent of all capital gains. It is not surprising that the Liberals should be defending those people because in fact some of them, until a couple of years ago, used to be their principal source of funds, although the Liberals are now having some difficulty in collecting these funds.
I think it is interesting as well to note that on July 1 of this year the Chief Electoral Officer published the statement of the source of revenue of the three political Parties in Canada. As New Democrats, we are proud that we are a democratically financed Party, financed by the people of Canada. The Liberal Party and the Conservative Party receive thousands and thousands of dollars from the banks. The Liberal Party receives something like $50,000 a year from the banks. The Conservatives receive $50,000 a year from each of the major banks in the country.
It is not surprising that the Liberals are somewhat sensitive. They have a record of fiscal incompetence that is embarrassing. Canadians will never again allow them anywhere near the reins of power. They will go the way of the Liberal Party of the United Kingdom and the way of the dodo bird. They will be relics of the past.


Some Hon. Members:: Hear, hear!

July 20, 1988
Income Tax Act and Related Acts


Robert Phillip Kaplan: Mr. Speaker, it is rich listening to the Hon. Member for Burnaby (Mr. Robinson) talking about the funding and financing of the Liberal Party and the Conservative Party and contrasting it to the democratic methods by which funds are raised by his Party. Yet the New Democratic Party is the only Party in the country which had a contributor go to the Federal Court of Canada to try to get his contribution back. He got it back, too. He did not want to contribute to the New Democratic Party. The banks which have made contributions to other Parties, as other companies have done, have at least done it voluntarily. New Democratic contributors want their money back. The court is ready to give it back to them. I do not think that the New Democratic Party should be telling Liberals and Conservatives anything about democratic fund-raising.
I have another question for the Hon. Member for Burnaby. It does not matter much that I do not get to ask it and have an answer from him, since I did not get an answer to the last question I asked. I asked him how he would define small business. He was unable but, more likely, he was unwilling to define small business for the purpose of the New Democratic capital gains tax exemption. I would be very interested to hear him-and I challenge him on some early occasion, or any other member of his Party-give the Canadian people more details about the exemptions that will be available from their Government in the unlikely opportunity, but the possibility, that they form the Government after the next election.
I have another question that I wanted to ask him, and since I did not get much of an answer to the last one, I think I will ask this one anyway as a hypothetical question. He indicated that following the next election in spite of the polls and in spite of what all of us who travel across the country meeting voters know if there is not a New Democratic Government, what his advice would be to people who are in the following situation. They cannot vote for the New Democratic Party. They might have been beguiled by what the Hon. Member had to say about tax reform, but they do not feel that they can support a political Party that wants to take Canada out of NATO. They do not feel that they can support a political Party that wants to nationalize at least one of the banks. They do not want to see the Government running a bank in addition to all the other things that Governments run and perhaps should not. Maybe they will say that they do not want to vote for a Party whose justice critic voted against the Canadian Charter of Rights and Freedoms. Let us say that we were dealing with a voter who could not support with good reasons the New Democratic Party. Would he advise on the basis of taxation that that voter vote for the Liberals or the Conservatives? I do not know what the Hon. Member would have said if I had called on him, but I believe that he would have said, and that his advice to the Canadian people would be, to vote Liberal in a case like that. That is why I thought he was wearing a red tie.
There are some things that should be said about this tax reform package presented by the Government. I want to try to say some of them right now. The first thing that has to be said is that this is not tax reform. I remember during the last Parliament watching some very sincere activities by Members
opposite, members of the Conservative Opposition in those days, directed toward improving the taxation system. I remember the efforts of the present Minister of National Defence (Mr. Beatty) to try to make the tax system simpler and less complicated. I think of how ironic it is that a political Party that in opposition developed a plan for making the taxation system simpler should have produced what it calls tax reform which is so much more complicated.
In my constituency office last Saturday afternoon I had a line-up of people who needed help with this long blue form that they had all received to enter into the simplified tax reform. It is not hard to do your twelfth, thirteenth or fourteenth form. But it is very complicated for the average individual to sit and look through and answer the complicated questions by which this so-called tax reform is being launched. It is not simpler. It is more complicated.
Also on the subject of tax reform, I remember in the last Parliament the efforts of the present Minister of Finance (Mr. Wilson) to try to deal frankly, openly, and honestly with taxation issues. I think he was very sincere when he was doing that. What I find to be the most astonishing feature of this so-called tax reform is the misrepresentations that it contains, the blatant efforts to pull the wool over the eyes of the Canadian people about what is happening in this so-called tax reform. I do not think Canadians will be fooled by this.
When the Hon. Member for Don Valley East (Mr. Attewell) stood up and said that four out of Five Canadians would find their taxes reduced by tax reform, he knew the full story. What he meant by that statement was that four out of five Canadians would pay less tax under this tax reform than they did in the immediately preceding year, which was the third year of Conservative Government.
What he did not say and what he is hoping the Canadian people will not find out is that those four out of five taxpayers have had substantial tax increases under this Government, so much so that the reduction in this tax reform is no reduction at all. Each of those people, if they are in the same income level that they were when this Government took office, will be paying substantially more taxes as a result of a Conservative Government than they would have without any of these tax measures over the last four years.
I say that it is a misrepresentation to stand up and say that four out of five Canadians will pay less taxes this year than last. It is true, but when we look at the whole picture we see a Government that has engaged in what our Leader has called, and quite truly, the largest tax grab in the history of Canada.
I would like to say something very direct and blunt about tax increases because when the Hon. Member stood up, and I asked him a question about it, he said: "Oh yes, but we had a big deficit to pay off which we inherited from the former Government". It is true, there was a big deficit built up during the Liberal years of office. A great many good things were done with that money. In retrospect one can see that we should
July 20, 1988

have paid our way more as we went along. I concede that there was a big deficit. In years of prosperity something should be done to reduce the deficit. I am not arguing about that. I am not saying that taxes should never be increased. I am not saying that this Government should not have had to increase taxes. 1 am not saying that a Liberal Government, if there had been one in office, would not have increased taxes. 1 say something that I believe to the bottom of my heart: a Liberal Government would never increase taxes in a way which makes poor and middle-income people pay more while the richest people, the highest income earners in society, pay less. Their taxes go down while lower and middle-income Canadians have their taxes increased. I would like to think when Liberals have to increase taxes that they would be increased on a progressive basis, in order that those best able to pay would be the ones who would pay more, not those who are most able to pay would pay less. That is the formula followed by the Conservative Government.
The Minister of Finance had a cute phrase: "We want more wealthy people in Canada". That is an interesting idea. It is a good idea. If there are more wealthy people in the country, it is not a bad thing, but if people are made wealthy by having their taxes lowered while the deficit accumulated on the books is approached by making poor and middle income people pay more, that is fraud. It is not liberalism, and it is not tax reform. I hope the Canadian people will see through what this Government has done and call a spade a spade.
Another thing that astonishes me coming from the lips of the Minister of Finance, who was very sincere and dedicated while in opposition to have genuine tax reform, was the Government stating that tax reform has removed 850,000 lower income persons from having to pay income tax.


Robert Nesbitt Horner: That's right.


Robert Phillip Kaplan: "That's right", the Member opposite says. This year, without tax reform, 850,000 more people would have had to pay taxes than would have paid them without this so-called tax reform. Like the four out of five Canadians who are supposed to be better off, I would like to look at the situation of the 850,000 lower-income persons who have been removed from the tax rolls. Who are they? Did they suddenly get jobs and that is why they are having to pay taxes or not having to pay taxes? Those 850,000 people are the poorest Canadians who, in spite of their poverty and low incomes, were added to the tax rolls by measures the Conservative Government introduced since it came to office. There is no doubt about that.
The Fraser Institute has laid it out chapter and verse. In the first year of office the Government eliminated the inflation adjustment for taxes. The former Government had a policy that raised the floor in order that low-incomc Canadians were not brought into the tax rolls just because of inflation. That was introduced by the Leader of our Party when he was Minister of Finance. For a decade of Liberal Government
Income Tax Act and Related Acts
every year the floor on income taxes increased so that poor people, who were not paying taxes the year before because of inflation, would not find that they were obliged to pay taxes because their inflated incomes brought them into the tax roll.
This hard-hearted, cruel, oriented to the rich, regressive Government removed that adjustment so that poor people, because of inflation and not because their real incomes went up, came into the tax roll year after year of Conservative Government. Over one million people became income taxpayers because of that change in income taxation. They became taxpayers not because they benefited from prosperity during a Conservative Government, which is what the Minister of Finance tried to say-


Robert Nesbitt Horner: Maybe they got a job. Did you ever supply
any?


Robert Phillip Kaplan: I am not talking about those people. I am talking about people whose real incomes did not change. Some people did get jobs. Many jobs have been created during the last few years in Canada, in the United States, and in every industrialized country, but additional taxpayers appeared in Canada because of the callous policies of the Government introduced in its first years in office. According to the Fraser Institute over one million people became taxpayers because of inflation, although their real incomes did not change.
Now we get the great news that 850,000 of those one million people are being put back, as far as taxation is concerned, to where they were when the Liberals were in office. That is the Government's idea of tax reform. It might be the Government's idea of tax reform. When it says to those 850,000 people who would otherwise have had to pay taxes that under Tory taxation they will no longer do so, perhaps some people will think that a break is being given to lower-income Canadians, but the Government is not even restoring the situation that Canadians faced before the last election. There are still 150,000 people whose real incomes have not increased and who are paying taxes thanks to the Tories. During the election campaign we will see how grateful they are.
I am also concerned about child care. There is something in this wonderful tax reform package for mothers. What has been put on the table by the Government is so far from what is needed and so far from what it promised in the last election campaign that to call it tax reform and put it forward as a reason for voting Tory in the next election is the most bizarre proposition that has ever been put forward.
"We cannot afford it", the Hon. Member says, as he turns his back and marches out of the House. Canadians said the same thing about the old age pension. They said the same thing about medicare. They said the same thing about our massive support for post-secondary education, that we could not afford those things. Justice requires that Canada develop on an urgent basis an adequate child care program. Not only that, the economy demands it.

July 20, 1988
Income Tax Act and Related Acts
While we were bringing into place other major social reforms in this country, some of which I have just described, we were not focusing too much on child care. We lived with a reality, which has now become a myth, that there is a spouse at home looking after the children. When we needed to face up to old age pensions, and when we needed to face up to medicare and so on, child care was not competing because there was a spouse at home looking after the children and child care seemed like a frill.
All three political Parties officially recognize the reality; it was recognized in the last election campaign. There is no spouse at home dedicating herself or himself full time to looking after the house and children. She is at work, or she is loqking for a job, or she has a job. She is not working for extra money to supplement the family income. In many cases-less than half, but perhaps in my riding more than most-such a woman is the sole income earner for a family with children. There is no adequate child care system.
The Government proposed a child care system. I did an analysis of it with the 200,000 additional day care spaces that were going to be created. One-tenth of the entire national production of this government program is needed in my riding. The City of North York in Metropolitan Toronto is 20,000 day care spaces short. There are more than 10 ridings in Canada; in fact there are nearly 300. We cannot say that we cannot afford it and return to that old rhetoric. We are talking about a program which is an economic reform and a way of taking a burden off the minds of mothers in my riding who need to work to support their families and cannot find a proper place for their children to be cared for during the day.
I do not like to hear men saying that a proper child care program is a frill, that it is not necessary, that it is too expensive, because unlike the other programs I mentioned child care is one where the injustice is borne by and large by women.
In this place where the majority of Members of Parliament are men, we have to be extra sensitive to a woman's point of view. I do not think Hon. Members are sensitive when they say that child care is a fringe or a frill that we cannot afford to have right now. We need to do justice to the mothers of this country by having an adequate child care program.


Some Hon. Members:: Right on.


Robert Phillip Kaplan: What is in the tax reform? The tax reform contains a couple of hundred dollars per child for each mother.
When Members opposite were asked about this program over the months that they were trying to bamboozle Canadians into considering their child care package to be worth while, they said: "Well, it is up to the mother. If she wants to spend it on her children, if she wants to establish child care, she has the money and she can do what she likes".
We on this side of the House know that that attitude will not create a national child care program in Canada. We do not want it totally in the public sector. We do not want to nationalize the kinds of child care facilities that there are across this country. Many of them are adequate. Many of them are economical. Many of them provide employment for mothers who take in four or five other children from their apartment building to look after them during the day. We do not want, as the New Democratic Party does, to see those types of day care facilities expropriated by the Government in favour of public child care. We have put forward a program. We want an honest, acceptable, comprehensive child care program that will give the women of this country justice. By the way, it will give the children of this country a good start in life, with a proper child care system containing great standards. This tax reform fails on every count. It should be rejected by us in this House, and it should be rejected by the Canadian people in the next election.


Some Hon. Members:: Hear, hear!


Mr. Deputy Speaker:: On questions and comments, the Hon. Member for Windsor-Walkerville.


Howard Douglas McCurdy: Mr. Speaker, I know that in a certain context the word "hypocrisy" is unparliamentary, but sometimes one has difficulty in this House understanding what is meant by that word. Perhaps the Hon. Member could help me with its definition. I wonder if this would correspond to an acceptable definition of hypocrisy: the notion that somehow it is illegitimate for a democratically elected union to determine democratically that contributions will be made to the New Democratic Party, being criticized for such but at the same time being perfectly acceptable for $80,000 in money from depositors and shareholders in banks to be contributed to the Liberal Party, even though individual depositors and individual shareholders may object to it. I wonder if seeing a difference between those two is not hypocrisy.
The Liberal Party criticizes the inadequacies of the Progressive Conservative Government with respect to tax reform which it could have brought about in the many years that it was in power. Is that not hypocrisy? I wonder if there is not a danger of hypocrisy in the notion proposed by a certain Leader of the Liberal Party that there would be no wage and price controls and subsequently introduce such wage and price controls, and whether that kind of hypocrisy does not hint at the kind of hypocrisy that one might expect in the same Party with respect to free trade. It is a Party that said that it will tear it up, but a Party that also had great difficulty, recently, in getting contributions from those same banks, large corporations, and corporate people in respect to their fund-raising. I do not know what hypocrisy is, but I wonder if the members of the Liberal Party could not give us a better definition of it, by virtue of experience, than anybody else in the House.
July 20, 1988


Robert Phillip Kaplan: Mr. Speaker, I think that when I am finished perhaps the Hon. Member will have a better understanding, because 1 want to put it precisely in the context of the questions that he asked. I criticized the New Democratic Party because it attacked our method of fund-raising to get contributions from banks, from virtually anyone who wants to contribute, wlple in the New Democratic Party I mentioned that someone went to the Federal Court of Canada to get his money back. They belonged to a union. As the Member said, they democratically decided that they were going to support the union and therefore every member, whether he liked it or not, had to contribute.
The Member asked me: "How is that different from a bank? Do the shareholders and the depositors get a say in whether the contribution is made?" As a matter of fact they do not. If an individual shareholder finds that the directors of the bank have decided to make a contribution to the Conservative Party and to the Liberal Party, and he may not like it. there is nothing he can do about it. If a depositor who is depositing in a bank learns that the bank is spending part of its money by making contributions to the Liberal Party and the Conservative Party, he cannot change the bank's policy. There is a very important difference in a contribution that the union makes and a contribution that a bank makes. If I do not want my bank to contribute to the Conservative Party or to the Liberal Party, I can move my money to another bank. If I am a depositor and I am not happy with the bank's investment, policy, I can take my money out.


Howard Douglas McCurdy: Which other bank?


Robert Phillip Kaplan: If I am a shareholder and I, find out that the Bank of Nova Scotia is contributing to the Liberal Party and I do not like it, I can sell my shares and buy shares in another bank. This unionist is forced to pay dues to the union, whether he likes it or not and whether he joins or not and he is forced to see part of his dues go to the New Democratic Party.
An Hon. iMember: The shareholder in the bank has no choice at all.


An Hon. Member:: The unionist can leave his job.
Income Tax Act and Related Acts


Robert Phillip Kaplan: Yes, the unionist can leave his job and the shareholder of a bank can sell his stock. There is not much of a parallel in saying that you can sell your shares and invest in another bank that contributes to the political Party that you like, I suppose there are co-operative banks registered as such that make contributions to the New Democratic Party. If someone is unhappy with the way that they are handled as a depositor and with what happens with their money, they can change.
Do you know what you have to do to get relief if you are a member of a union or if you are paying dues to a union? There is no stock to sell. There are no deposits to transfer. You have to do what someone recently did; you have to go to court. He had to go to the Federal Court of Canada to get back the money that the union contributed out of his dues, against his will, to the New Democratic Party. What is hypocrisy? I think it is failing to recognize that.
I wanted to, take some time to also talk about loopholes. The Liberal Government introduced a lot of loopholes, which were characterized as tax incentives and designed to produce certain results. I a,m not saying that they all worked. Why the Conservatives did not stop the science endeavour when they should have, why they let it run on and on for a billion dollars, I do not know, but tax loopholes created certain important industries in this country such as the movie industry. I do not think that we want to do without it. A loophole was meant to be an incentive. In many cases, they were incentives. If they were exceeded, as the Members opposite said, they should have changed them and stopped them when they first took office.


An Hon. Member:: They shouldn't have even got in.


Robert Phillip Kaplan: They should not have gotten in. I agree with that.
Mir. Deputy Speaker: I hate to put an end to this debate, but it being six o'clock this House stands adjourned until tomorrow at 11 o'clock, pursuant to Standing Order 3(1).


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

Thursday, July 21, 1988
[Stage Direction]
Prayers