1988-03-02

Mr. Keith Penner (Cochrane-Superior):: Mr. Speaker, recently, the Minister of Finance (Mr. Wilson) has received close to 1,000 letters from the residents of Geraldton, Ontario protesting their exclusion from northern tax benefits. As well, I wrote to the Minister in December with a proposal to make the current regulations fairer. To date, there has been no response from the Minister.
On Monday of this week, each resident of Geraldton, Ontario received by mail directly from Revenue Canada a copy of the tax guide along with the form required to claim the northern benefits tax deduction. This mailing was taken to mean by taxpayers in the community that the Minister had changed his mind. Several residents have now mailed in their returns claiming this northern benefit. Revenue Canada, however, continues to state that Geraldton does not qualify.
I call on the Minister of Finance and the Minister of National Revenue (Mr. MacKay) to take the necessary action to eliminate the confusion and to name Geraldton, Ontario as a prescribed area immediately, giving the residents the tax deduction they deserve, which they are now denied merely by being a few kilometers short of the required distance.


PAGES AND MEMBERS HOCKEY GAME
Mr. Gordon Taylor (Bow River):: Mr. Speaker, last night the all Party MP hockey team playing against the House of Commons Pages won the gold. With a million dollar goalie,
defence and forward lines, the MPs scored seven goals to five with Dave Dingwall being the top scorer.
Stephen Cassivi, the able captain and coach of the Pages, starred by beating the indomitable MP goalie, Moe Mantha, three times while Suh Won Kim and Dominic Peltier-Rivest each put the rubber in once. It was a hard fought battle throughout with both teams performing with skill and excellence. The silver winners, cheered on by their fellow Pages, one with a bugle, kept the MPs on their toes and the gold winners were not known until the final whistle.
Every MP came out of the game with an increased admiration for all of the Pages. Their skill, dedication and sportsmanship made each of them worthy of an Olympic medal. With young people like these Pages we can be sure that Canada will be in good hands in the future.
Viva the Pages!
V *	*


TELEFILM CANADA
Mr. Ian Waddell (Vancouver-Kingsway):: Mr. Speaker, I would ask the Minister of Communications not to renew the mandate of Telefilm Canada President Jean Sirois before the next meeting of the Standing Committee on Communications and Culture.
At my request yesterday the committee agreed to ask Mr. Sirois, Mr. Peter Pearson and other individuals to give evidence.

1 think it would be appropriate for the Minister to hold off on the reappointment of Mr. Sirois until the committee looks appropriately at the allegations that have been made, including allegations of aggressive, strident interventions at every level of the decision-making process, allegations about the expense accounts of the chairman and allegations about the finances of Telefilm Canada. It would be appropriate to wait before reappointment, if any at all.

March 2, 1988


S.O. 21 REFUGEES ALLEGED DISTORTION OF VOYAGE OF S.S. ST. LOUIS
Mr. John Oostrom (Willowdale):: Mr. Speaker, Members of Parliament must rely on their researchers to provide accurate information on issues they raise in the House. On February 1 and 2, two members of the NDP, speaking on Bill C-84, distorted the historical record of the tragic voyage of the S.S. St. Louis, a ship full of Jewish refugees fleeing Europe.
The Hon. Member for Kamloops-Shuswap (Mr. Riis) stated, as recorded on page 15512 of Hansard, that the Canadian Government forced it to return to Europe. Further, he said that sources tell us that virtually all these people eventually met death. This is not what the historical record states.
The Canadian and American Governments communicated to the ship that it would not be allowed to disembark any of its passengers if it came to one of their ports. The ship spent its entire voyage in a Cuban port or steaming off the Florida coast. At no time did the ship even approach Canadian territorial waters.
Of the 907 people aboard the S.S. St. Louis, France took 224, Belgium took 214, Holland took 181 and Britain took 288. Of the 907, 528 escaped the Nazi Holocaust.
The St. Louis incident was a dark day for civilized society and is an example of the brutality of which mankind is capable. However, the use of history must always be exact-


Mr. Speaker:: The Hon. Member's time has expired.


TAXATION
Mr. George Henderson (Egmont):: Mr. Speaker, I want to call to the attention of Members of the House yet another unfair tax policy of the Tory Government. Sixty-five communities in Nova Scotia are on the qualifying list for the northern allowance, a standard tax deduction for residents of isolated areas effective for the 1987 taxation year. This deduction could mean $800 to $1,200 extra in taxpayers' pockets. Not one community in either Prince Edward Island or New Brunswick is on this qualifying list.
To make matters worse, many of the communities on the prescribed area list do not even meet the set criteria, yet they are eligible for the deductions anyway. It appears that many other maritime communities deserve this tax assistance as much as those 65 Nova Scotia communities already on the list. Why this B.C. preferential treatment? The whole matter reeks of unfairness.
The people in the western end of Prince Edward Island and elsewhere in the Maritimes deserve an explanation. I now urge
the Minister of National Revenue (Mr. MacKay) and the Minister of Finance (Mr. Wilson) to give these taxpayers the explanation they deserve.


EXTERNAL AFFAIRS
Mr. Don Ravis (Saskatoon East):: Mr. Speaker, recently, I had the privilege, as a member of the External Affairs Committee, to travel to three Middle Eastern countries at the request of the Secretary of State for External Affairs (Mr. Clark). Our purpose was to gather information and to learn more about the conflict from leaders and elected officials as well as from the people who live in the villages of the West Bank and Gaza.
As a Canadian parliamentarian, I was disappointed and frustrated in witnessing a conflict involving loss of life and human rights violations which are unacceptable, regardless of political differences.
I urge the Secretary of State for External Affairs to denounce the human rights violations which have been occurring during the past several months and to strongly support an international conference which will begin building trust and confidence between Israel and the Palestinian people.
We as Canadians pride ourselves on tolerance for each other's religious and cultural differences. While we are not perfect, I urge countries in the Middle East to follow our example.


EXTERNAL RELATIONS
Mr. Bill Blaikie (Winnipeg-Birds Hill):: Mr. Speaker, the Tory agenda for turning Canada into a banana republic came closer to completion the other day with the spectre of the Prime Minister (Mr. Mulroney) giving a political speech to the army in Lahr, conjuring up images, not of a secure Prime Minister of a mature, democratic nation, but of some tin-pot dictator who is so insecure that he has to abuse well established democratic traditions in the way the Prime Minister did in Lahr.
The Prime Minister brought shame on himself and he brought shame on Canada. It is something that all Members of Parliament, if they have a shred of respect for parliamentary tradition and for the traditions of Canada, would find unacceptable.
COMMONS DEBATES___________________________________13301


Some Hon. Members:: Hear, hear!
March 2, 1988


AGRICULTURE
Mr. Felix Holtmann (Selkirk-Interlake):: Mr. Speaker, the livestock feed assurance program in Manitoba is failing to meet the needs of Manitoba farmers. This program is intended to insure hay production in Manitoba and is operated under the auspices of the Manitoba crop insurance program. It is funded 50 per cent by the federal Government and 50 per cent by the farmers. The province provides the administration. It is that administration which is failing the farmers.
A large number of farmers in my constituency are steaming hot mad at the NDP Minister of Agriculture and have informed me that the entire structure of the program is not serving their needs. If the program is not serving the needs of Manitoba farmers, it is not serving the needs of the federal Government.
Farmers, who last year had their first hay production failure in 20 years, failed to get a pay-out under the program. The program is poorly structured, poorly administered, and poorly designed. I ask the federal Minister of Agriculture (Mr. Wise) to investigate the problems in that program to ensure that money belonging to the farmers and the federal Government is being properly utilized. I ask the Minister to help make sure that the interests of Manitoba farmers are well taken care of.


PAGES AND MEMBERS HOCKEY GAME
Mr. Dave Dingwall (Cape Breton-East Richmond):: Mr. Speaker, last night a great tradition was upheld at the annual hockey game between Members of Parliament and the Pages. The game, superbly organized by the Hon. Member for Bow River (Mr. Taylor) was full of action and excitement. After three periods of play the MPs and Pages were tied at five goals each. The decision was made to push the game to a fourth period. The fans were ecstatic. There were many confrontations but with the strategic coaching and strong leadership of the Hon. Member for Bow River, the MPs put on the pressure. The Pages kept the MPs in check but to no avail. Two quick goals scored late in the fourth period allowed the MPs to take home the trophy with a seven to five victory.
I join with my friend from Bow River in thanking and congratulating the Pages for exhibiting enthusiasm and sportsmanship. As well, on behalf of all Members of Parliament and all the Pages, I would like to salute and thank the Hon. Member for Bow River for organizing this annual tradition of Parliament.


MINES AND MINING
Mr. John A. MacDougall (Timiskaming):: Mr. Speaker, yesterday at the Holiday Inn 200 leaders from across Canada involved in mining, prospecting, and investment, along with municipal representatives, witnessed the White Knight of the NDP come in on his horse to say to them that he now believes flow-through share funding is vital to the mining community across the country. Does he really believe that Canadians have short memories and do not remember statements made by him in Kirkland Lake in February, 1987, to the effect that only wealthy investors benefit from flow-through shares? Does he think they do not remember his Party's critic who voted against amendments in this House to extend flow-through shares because he said it is only Bay Street that will benefit?
It sickens me to see that with a little smell of power the socialist party will throw its principles out the door. Since 1982 Timiskaming knows where its Member of Parliament stands. He believes that the socialist party still does not know what flow-through shares are all about.


RAILWAYS
Mr. Les Benjamin (Regina West):: Mr. Speaker, the west is betrayed again. The Government has failed to honour a commitment to spend all of the money allocated to the rehabilitation of railway branch lines in western Canada. After four years of Tory Government, $36 million of the money allocated has not been spent. In the coming year only half of what is allocated is to be spent. The Government is deliberately trying to jeopardize the existence of many hundreds of miles of branch lines in order to abandon them and force grain farmers to truck their grain to places many miles further away.
The Bengough subdivision from Weyburn to Willow Bunch is one in which I and the Hon. Member for Assiniboia (Mr. Gustafson) have more than a passing interest. Some $10 million was spent on that line over two years ago. Some $13 million more must be spent to complete the job. I call on the Minister of Transport (Mr. Crosbie) to immediately announce the inclusion of the Bengough subdivision in this year's program, and all of the remaining lines in 1989.

March 2, 1988
Oral Questions THE CONSTITUTION


MEECH LAKE AGREEMENT-REPORT OF SENATE TASK FORCE
Mr. Dave Nickerson (Western Arctic):: Mr. Speaker, yesterday the Senate task force on the Meech Lake Constitutional Accord, in the Yukon and Northwest Territories, published its report. The report makes sensible recommendations with respect to appointment mechanisms for Senators and Supreme Court judges. It addresses the outstanding questions of territorial representation at First Ministers Conferences, changes to territorial boundaries, and the eventual creation of new provinces.
The task force listened to northern Canadians who so often before have been disregarded. Their recommendations are sound and ought to be incorporated into the Canadian Constitution.
The Senators, Sir, are to be complimented on a job well done.


LABOUR RELATIONS
Mr. Gaston Isabelle (Hull-Aylmer):: Mr. Speaker, all Canadians residing in the National Capital Region, particularly francophones, are wondering about the future of the newspaper Le Droit whose survival is threatened should the strike last too long.
Le Droit has been the carrier of the francophone torch and the standard bearer of its cultural dissemination since 1913. We should not let this symbolic flame go out, especially here in the National Capital Region, the mirror and reflection of bilingualism in Canada, the main centre of Canadian bicultur-alism.
It would be a deplorable and even disastrous blow to information and democracy if francophone residents of the region were to lose their privileged spokesman.
This is why I strongly urge both parties in this dispute to resume negotiations in an effort to find an honourable and dignified solution, even though they may have to backtrack from their respective positions. By so doing they would preserve an essential asset of Canada's heritage.



ORAL QUESTION PERIOD


Right Hon. John N. Turner (Leader of the Opposition):: Mr. Speaker, I have a question or two for the Minister of Finance. In June of last year the Minister of Finance announced, to the applause of the New Democratic Party, that he was eliminating the 33 per cent earned depletion allowance for flowthrough shares to investors in mining companies.
That may sound technical to a lot of Canadians, but it means thousands of jobs to miners in Canada. Flow-through shares have helped sustain thousands of jobs in small mining companies and small mining communities across Canada.
The Liberal Party was opposed to the Minister's decision then and is opposed to that decision now. This program was working. It was bringing hundreds of millions of dollars of investment into the mining industry. Why is the Minister phasing it out?


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, I do not think the Hon. Member wanted to leave the impression that this is only being phased out on flow-through shares for small mining companies. It is being phased out for large mining companies, large oil and gas companies, as well as other players in the industry. It is being phased out in total.
The Hon. Member has asked precisely why we are making this change. It is part of the over-all balance in tax reform, part of the way in which we are reducing tax expenditures, tax breaks, and tax write-offs, as a means of broadening the tax base so that we can reduce the personal tax paid by 85 per cent of individual Canadians across Canada.
That is the substance of the reason. It is part of a broad reduction in tax expenditures, tax breaks which, as my colleague knows, have been criticized by the New Democratic Party as providing a tax write-off to wealthy investors.


John Napier Turner: Mr. Speaker, the New Democratic Party seems to have changed its mind on the issue of earned depletion.


POTENTIAL LOSS OF MINING COMMUNITIES
John Napier Turner: Mr. Speaker, the measure which the Minister has in his so-called tax reform will eliminate hundreds of smaller mining communities in the country if it is persisted in. The miners in Canada are rightfully insulted by the twisting, turning, and phoney rhetoric of both the Government and the New Democratic spokesman on this particular issue.
The Minister of Energy, Mines and Resources stated yesterday that the Government is prepared to consider other

March 2, 1988

measures "if the tax reform changes put forward affect the viability of mining operations".
In other words, the Government is prepared to let the smaller mining communities in the country close down before it considers whether to take any action. Why did the Minister not analyze the potential effect on the mining communities of Canada before he took this decision and introduced it as part of his so-called tax reform?


Michael Holcombe Wilson: Mr. Speaker, let me caution Canadians about the overblown rhetoric that the Right Hon. Leader of the Opposition has used. This change will not eliminate the mining communities in Canada. This will not eliminate the centres. It will not-


Mr. Fulton:: It will create 200 Scheffervilles.


Michael Holcombe Wilson: It will not eliminate the flow-through shares-


James Ross Fulton: Two hundred Scheffervilles.


Michael Holcombe Wilson: If the Hon. Member in the back row would listen, he might learn something. It will not eliminate the flow-through share mechanism.
In fact, the Leader of the Opposition is very well aware that from the time of the initial proposal in June last year to the proposal that I announced in December, and which is on the table now, we made some significant changes. We increased the time when earned depletion will be available. Second, we made two significant changes that will maintain the attractiveness of the $500,000 capital gains exemption which the Hon. Leader of the Opposition has said on many occasions he would pull out altogether. He is talking out of both sides of his mouth, the same as the Leader of the New Democratic Party.
[ Translation]


AID FOR THE UNDERPRIVILEGED REGIONS-REQUEST FOR RESISTANCE TO AMERICAN PRESSURE
John Napier Turner: Why won't the Minister admit his Government made a serious mistake, a mistake that according to the Quebec Minister of Mines is due to a lack of information?
Since he failed to give any economic reasons for making this decision, will the Minister admit that the decision was made because of pressure from the Americans who don't like programs that support our country's disadvantaged areas?
Mr. Speaker, why won't the Minister stand up to the Americans for a change? Why won't he defend this country's disadvantaged and remote areas and reverse his decision? Why not?
Oral Questions


Michael Holcombe Wilson: Mr. Speaker, the Leader of the Opposition should be aware that one of his colleagues asked that question just yesterday and I say-


Ms. Copps:: We did not get an answer.


Michael Holcombe Wilson: I will give the answer a little bit more strongly than I did yesterday. That is a red herring. It is absolute garbage. We brought in the flowthrough share changes in June, 1987. If the Hon. Leader of the Opposition would reflect on that, he would see it is four months before the free trade agreement was signed.


John Napier Turner: Right during negotiations.


Michael Holcombe Wilson: After the free trade agreement was signed we made changes to improve the flowthrough share mechanism. I say to him and to Canadians that the flow-through share mechanism stays in place. We have improved the flow-through share mechanism as a result of the changes in December.
We also said that we are monitoring the situation. As my colleague said yesterday, we are prepared to make changes should circumstances necessitate it.
I also say to him that there has been a significant drop in equity investment financing from the first nine and one-half months of last year, of $7 billion to approximately $450 million. That has affected flow-through share financing and has affected equity financing for all types of issuers in Canada.


MINING DEPLETION ALLOWANCE-POSSIBLE EXPANSION
Mr. Raymond Garneau (Laval-des-Rapides):: Mr. Speaker, if what the Minister of Finance just said is true, why does he not decide to keep the earned depletion on flow-through shares?
We know that the trade agreement with the United States has eliminated the possibility for the Canadian Government to have a made in Canada policy on investment, energy and culture.
There is a new twist. The Minister said that our point of view was garbage. I do not know whether he would agree with the statement made by Clarkson Gordon, a very well known and respected accounting firm. That firm said in its publication of January 15, 1988: "Although the existing tax incentives will be grandfathered according to the trade agreement, it is important for Canadian business people to recognize that expanding the list of such incentives could induce a responsive trade action by the U.S".
Does the Minister agree with that interpretation by Clarkson Gordon of the deal he signed himself and which, in a general spirit, says that the Government has put aside the

March 2, 1988
Oral Questions
possibility of helping the regions of this country with tax incentives?


Michael Holcombe Wilson: Mr. Speaker, Clarkson Gordon may be very good accountants but they are not very good trade specialists.


Some Hon. Members:: Oh, oh!


Michael Holcombe Wilson: There is no basis for them to make that particular comment. Flow-through shares and tax considerations related to flow-through shares are generally available in the tax law to any Canadian company. Any changes in that are not governed by the terms of the free trade agreement.


FLOW-THROUGH SHARES-GOVERNMENT POSITION
Raymond Garneau: Mr. Speaker, as I see it, the Minister has a mental block and refuses to understand the problem. We are not saying the mechanism was abolished, we are saying that now that earned depletion has been abolished, the mechanism is no longer operational. That is what 250 people from all our regions came to tell us.
I would therefore ask the Minister, after the representations made to the Minister of Energy, Mines and Resources and to all Members of this House who attended yesterday's symposium, whether he does not agree that he made a mistake-isn't he admitting as much now?-by not bringing back the 33 1/3 per cent earned depletion allowance before the Trade Agreement is implemented, as they would like him to? If he does not change his mind more regions will lose jobs, investment will disappear and although the Minister won't admit it now, he will not be able to reintroduce earned depletion if the Canada-U.S. Trade Agreement is approved.

Michael Wilson (Minister of Finance): Well, Mr. Speaker, 1 say to the Hon. Member that he knows as much about it as does Clarkson Gordon. The Hon. Member said I do not understand the significance of flow-through shares. I am the Minister, 1 should remind him, who made improvements to the flow-through share mechanism in 1986. I am the same Minister who made improvements to the flow-through share mechanism in December of 1987. So I can indicate by my own actions that I am quite aware-


Raymond Garneau: Why are all those people coming here to complain, then?


Michael Holcombe Wilson: The Hon. Member asks why the people have come to complain. I think those people are concerned about the state of play in the equity markets in Canada which have affected-


John Napier Turner: Oh, no!


Michael Holcombe Wilson: -flow-through shares, and I admit that. 1 understand that. But it has also affected equity financing on a broad range of companies. As I indicated, and 1 repeat the numbers, $7 billion worth of equity financing was done in Canada up until the stock market crash on October 19. Since then, I think it is $450 million of equity financing which has taken place. That has affected all parts of equity financing.
As 1 indicated, Mr. Speaker, we are monitoring the situation closely. We are holding discussions with the industry and will continue to hold those discussions in order to understand better its point of view.


IMPLEMENTATION OF OLDER WORKER ADJUSTMENT ASSISTANCE PROGRAM
Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, my question is directed to the Minister of Finance. Later today the Economic Council is releasing an important statement on labour adjustment policies for trade sensitive industries. Such policies are absolutely crucial, especially for older workers. Statistics Canada, for instance, found that 41 per cent of such workers dropped out of the labour market when they lost their jobs through a plant closing.
Given these facts, why has the Government still not put into place its program of older worker adjustment assistance which it announced in the 1986 Budget? Can it not see that this lack of action is a human tragedy?


Michael Holcombe Wilson: Mr. Speaker, I have responded to that particular question. My colleague, the Minister of Labour, has had numerous discussions with the provinces. This is a joint program with the provinces. Something in the order of four provinces have agreed to participate in it. He is endeavouring to encourage other provinces to participate in what we believe is a very important program. We want to move it along. As soon as we have the agreement of the provinces we will have further announcements to make.


DELAY IN IMPLEMENTATION-EFFECT ON OLDER WORKERS
Steven W. Langdon: Mr. Speaker, in fact it has been over two years since this discussion took place with the provinces. Surely at this stage the Government should see that it has to move, and that it has to move itself, otherwise we will have situations in which thousands of older workers will be thrown on the scrap heap in what is a human tragedy that the Government should be doing something about.


Mr. Speaker:: I am not quite sure whether there is a question there or not. The Minister may want to respond.
March 2, 1988


Michael Holcombe Wilson: Mr. Speaker, 1 do not think there was a question. I think it was a reiteration of the points that the Hon. Member made in the preamble to his first question.
We believe that it is important to involve the provinces in a program such as this because of their involvement in the labour market, because of their involvement with labour policy and because of their involvement with adjustment policy in the broader sense, as are we in the federal Government. We will continue to work with the provinces.
I hope that the Hon. Member, in his attempts to focus solely on the federal Government, will not ignore the importance of the provincial Governments in this matter and direct some of his attention to encouraging them to come on board in regard to what we believe is a very good program.


ASSISTANCE TO UNEMPLOYED OLDER WORKERS
Steven W. Langdon: Mr. Speaker, it seems to me that the Government is just trying to pass the buck. I wish to ask this of the Minister of Finance. What will the Government do to help people such as Robert Pereault, who is 49 and was laid off for a year from a closed plant, and who now must pay his UI back because he has finally received severance pay?


Mr. Speaker:: The Hon. Member raises an example, and there may be many more. However, I do not think that the preamble is the place to list them all.


Michael Holcombe Wilson: Mr. Speaker, 1 do not think that there is much difference from the first two questions in what the Hon. Member has said in his third. We both agree on the importance of the program. We also believe that the provinces should be in there. We are continuing to work with them. I hope that he will support us in that.


Mr. Allmand:: Mr. Speaker, a supplementary question.


ALLEGED EXCEPTION IN RESPECT OF OLDER WORKERS
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, why pass the buck to the provinces in the case of the older workers when, in the past, we had totally federal programs for older workers and when we still have federal employment programs for women, native people, the disabled and minorities? Why make an exception for older workers? They are just as important as the other groups.
Some Hon. Members:: Hear, hear!


Michael Holcombe Wilson: Mr. Speaker, I am sure that the Hon. Member is aware of the components in the Canadian Jobs Strategy that are there to help train older workers who have lost jobs and who want to move on to a new ones. The Canadian Jobs Strategy is a very important part of the program that we brought in as a Government.
Oral Questions
What the program for older worker adjustment does is add another dimension to that which we think is important. We also think it is important to have the involvement of the provinces, as 1 have said in answer to previous questions.


EXTERNAL AFFAIRS
Mr. Howard McCurdy (Windsor-Walkerville):: Mr. Speaker, my question is directed to the Secretary of State for External Affairs.
I have here a copy of an order by South Africa for germanium crystals that can be used for infrared weaponry. The Department of External Affairs did not reject this order.
My question to the Secretary of State is this: Doesn't this point to a weakness in Canadian sanctions, when certain types of equipment that can be used to develop weaponry can still be exported and shipped to South Africa?


Right Hon. Joe Clark (Secretary of State for External Affairs):: Mr. Speaker, I do not have the paper to which the Hon. Member just referred. I will have to look at this document and make inquiries, and once I have all the details, I will be in a position to answer the Hon. Member's question.


TOTAL EMBARGO ON EXPORTS TO SOUTH AFRICA
Howard Douglas McCurdy: Mr. Speaker, my supplementary question is as follows. Given recent events is it not time as a part of the imposition of universal, comprehensive and mandatory economic sanctions against South Africa that all exports to South Africa be embargoed immediately?


Charles Joseph Clark: Mr. Speaker, I think that the Hon. Member would agree that if Canada were to take a decision of that kind we should not take it because one order had gotten through the regulations that are now in place. I will look at the questions raised by the Hon. Member and at the documentation with respect to this particular case.
He knows, and I will be referring later to it this afternoon, of the Government's policy with regard to economic sanctions. He knows the concern and the outrage that all of us in the House feel with respect to the recent developments in South Africa. I believe he shares my view that what is important is not for Canada to make dramatic gestures that might end up empty, but rather for Canada to try to continue to find ways in which we might have a positive influence upon events in South

March 2, 1988
Oral Questions
Africa and not leave abandoned people who are now the opponents of apartheid in that region and in that country.


FINANCE
Mr. Robert Toupin (Terrebonne):: Mr. Speaker, my question is directed to the Minister of Finance and concerns flowthrough shares because these are important to Quebec.
On October 1 last year, I asked the Minister not to tinker with flow-through shares and told him these tax measures were essential to the economies of Northern regions like Abitibi-Temiskaming.
My question is this: Is the Minister again going to ignore the fact that flow-through shares helped Abitibi-Temiskaming bring its unemployment rate down from 23 per cent to 6 per cent and attract investments worth several hundred million dollars annually, investments that totalled half a billion dollars last year?
Why is the Minister turning his back on regional economic development? There is more to Canada than just Toronto, Mr. Speaker!


Michael Holcombe Wilson: Mr. Speaker, again, this is an example of overblown rhetoric. The Hon. Member accuses us of denying all regional development in that part of the country. That is simply unfounded. It is not true.
What we have done is make some adjustments in the flowthrough share mechanism consistent with the objectives of one of the former Parties of the Hon. Member, in which there was some suggestion that there were practices leading to abuse of the system. We have toned down some of the elements of the flow-through share mechanism in order to avoid that type of abuse. But the flow-through share mechanism remains in place. We improved the elements of the flow-through share mechanism in the December 16 paper on tax reform.
As I have indicated, we are continuing to consult with the industry to monitor the situation and to get its understanding of the effects of these changes.
[ Translation]


IMPACT ON REGIONAL ECONOMIC DEVELOPMENT
Robert Toupin: Mr. Speaker, my supplementary is directed to the Minister of Energy, Mines and Resources.
What amounts to the abolition of flow-through shares will have a direct impact on economic development. What does the Minister intend to do to help Abitibi-Temiskaming and our
small mining companies? Is he again setting himself up as the defender of the big multinationals, or is he prepared, for a change, to defend the interests of small mining companies in Quebec?


Hon. Marcel Masse (Minister of Energy, Mines and Resources):: Mr. Speaker, first of all, I would like to point out to the Hon. Member that the program was not abolished but revamped by the Minister of Finance.
Second, I can assure Hon. Members that all sectors in my Department, including the mining sector, are keeping a very close watch on developments, and as in other cases, the Government will make a contribution if the need arises.
Third, 1 fail to see why the Hon. Member is attacking big corporations in the mining industry.
Major investments in our industries have always been well received, and have always been welcomed by all Members of this House. In the mining industry, investments are always welcome, whether they come from big corporations or junior mining companies.


ATLANTIC CANADA OPPORTUNITIES AGENCY
Mr. George Baker (Gander-Twillingate):: Mr. Speaker, the purpose of the Atlantic Canada Opportunities Agency, as stated in its brochure, is to provide "financial and other resources for Atlantic entrepreneurs" and "working with provincial governments-to improve the entrepreneurial climate".
Why did the Minister state yesterday, "Some of the Premiers may want us to just turn over money to them and let them spend the money, but that is not something that is going to find favour with us".
Is that why there are more employees of this agency in Ottawa than there are in Newfoundland? The Prime Minister stated that the decisions would be made in Atlantic Canada.


Hon. John C. Crosbie (Minister of Transport):: Mr. Speaker, the hon. gentleman sounds like he has a tear in his tights.
We are working in co-operation with the Atlantic Premiers. Senator Murray, the Leader of the Government in the other unmentionable place, visited all four Atlantic Premiers within the last two weeks. We are working in co-operation with them.
We do not think that Members of this House expect us to turn over the $316 million that the Atlantic Canada Opportunities Agency is going to spend in the year coming up, to the
March 2, 1988

Atlantic Premiers to spend. We are going to spend it in accordance with the policies and directions of the Government to overcome regional disparity in Atlantic Canada.
In addition, any lapsing funds from this year-here's good news for the hon. chap-will carry over into next year for payoff.


ALLOCATION OF FUNDING-ACCOUNTABILITY TO ATLANTIC PREMIERS
George Baker: Mr. Speaker, yesterday the Minister also stated, when asked whether there was any new money spent by ACOA, "1 cannot tell you that right off the bat". What an informed Minister. It is like asking him did he wake up this morning. "I can't tell you that right off the bat, I have to ask Jane".
1 ask the Minister, who speaks on behalf of the real Minister in the-


Mr. Speaker:: I know that the Hon. Member is about to ask the Minister something. 1 would ask him to put his question.


George Baker: -who speaks on behalf of the other Minister in the unmentionable place, does he not agree that the people of Atlantic Canada and the Premiers of Atlantic Canada deserve more accountability than that from this Government?


John Carnell Crosbie: Mr. Speaker, as I said to Jane this morning when I got up, there are no quick fixes-


Some Hon. Members:: Oh, oh!


John Carnell Crosbie: -for whatever ailed her.


Mr. Speaker:: I hope the Hon. Minister is not going to tell us what she said.


SHIPYARDS
Mr. Jack Harris (St. John's East):: Mr. Speaker, we know from the Minister of Transport's comments in the House yesterday that the Government is mainly interested in making announcements and taking credit rather than real progress and real results when it comes to Atlantic Canada development.
1 must ask the Minister whether he is willing to discharge his responsibility to the people of St. John's, and to Canadian National Dockyard workers, and insist that the dockyard management bid on the repair contract for HMCS Nipigon that will bring 200 jobs to St. John's, in his own riding, instead of letting management make phoney excuses for not trying to get work for the shipyard?
Oral Questions


John Carnell Crosbie: Mr. Speaker, the hon. gentleman has gone over his depth in this particular issue. What has happened is that the Newfoundland dockyard has been asked to bid on the refit of the HMCS Nipigon. It would be a job costing somewhere between $12 million and $15 million and it would keep 250 men working there for one year.
Three of the seven railway unions are refusing to enter into a no-strike, no-lock-out agreement during the term of this repair. Therefore, the yard cannot undertake the work nor put in a bid, because it would be wasting money to put in a bid.
I suggest that the hon. gentleman speak to his friend who he was defending in St. John's yesterday, Mr. Rosner, and get him and the three unions to co-operate in order that 250 men can have a job for one year in a Newfoundland dockyard.


UNION OFFER TO OPERATE UNDER EXISTING AGREEMENT-POSSIBLE PRIVATIZATION
Jack Harris: Mr. Speaker, if the Minister was paying attention he would know that yesterday these unions offered, as they had before, to carry on their existing agreement which contains a no-strike clause until the end of their contract.
Why does the Minister not admit that this is part of some plan, which he supports, to either bankrupt or shut down the CN Dockyard so that it can be handed over to private interests?


John Carnell Crosbie: I am not
going to chastise the hon. gentleman. He is a new Member here. It just so happens that two years ago the Government agreed to put $14 million into the Newfoundland dockyard. We are meeting its operating losses to the tune of $2.4 million a year. We are meeting capital expenditures of $4 million.
Since 1976 I have done everything humanly possible to assist that yard. But I cannot assist it if some of the labour movement and the hon. gentleman are going to sabotage our efforts to get work for that yard.


CANADA POST CORPORATION
Mr. Alfonso Gagliano (Saint-Leonard-Anjou):: Mr. Speaker, my question is directed to the Minister responsible for Canada Post Corporation. The delivery standards of Canada Post are now so low that even Revenue Canada will no longer recognize the Canada Post date of reception as proof of payment, thereby penalizing several thousands of small businesses. My question to the Minister is this: Does he agree with Revenue Canada's position and how could he reconcile

March 2, 1988
Oral Questions
this with this Crown Corporation spending millions of dollars in advertising to enhance its image, at a time when even the Government repudiates the Corporation?


Hon. Elmer  M.@: Mr. Speaker, I apologize, but I did not get the entire thrust of my colleague's question.
From what I heard, I can only point out that the deadlines and the requirements for filing income tax and source deductions are well known. We run a self-assessment system in this country.
I take the opportunity to point out that we have extended the deadline for filing income tax from April 30 to May 2, so there will be some extra latitude.
I apologize, because I did not quite get the thrust of my colleague's question.


ALLEGED REFUSAL TO HONOUR CANADA POST POSTMARKS
Alfonso Gagliano: Mr. Speaker, my supplementary question is directed to the Minister responsible for the Post Office, because it is a postal issue. At the beginning of January, National Revenue informed all employers that once they had postmarked envelopes sending their monthly remittances by cheques they would be accepted as remittances made on time. Since this notice every small business in the country is penalized because National Revenue is not honouring the postmarked envelopes.
How can the Minister say that this service is good? How can the Minister encourage people to use the Post Office service when, by the actions of National Revenue, the Government is not honouring the Post Office service?
Hon. Harvie Andre (Minister of Consumer and Corporate
Affairs): Mr. Speaker, there is an old joke about the three most common lies, one of which is, "The cheque is in the mail".


An Hon. Member:: What are the other two?


Mr. Speaker:: I am sure that we do not need to hear the other two. Perhaps the Hon. Minister will answer the question.


Mr. Andre:: Mr. Speaker, National Revenue in requiring taxpayers to pay their taxes on time are presumably reflecting the fact that too many people use that excuse. Indeed, the Post Office has been encountering some difficulty with companies having their own postal machines. In sending out invoices through the use of the postal machine they backdate the mailing date and the mailing date sometimes has the eighteenth of the month when, in fact, these items are put in the mail on the twenty-second or twenty-third. The Post Office has the same problems as National Revenue.
The Government is calling on taxpayers not to use the Post Office as an excuse for not paying taxes.


ENVIRONMENTAL AFFAIRS
Mr. Jim Manly (Cowichan-Malahat-The Islands):: Mr. Speaker, my question is for the Minister of the Environment. In spite of growing anxiety about dangerous dioxin levels in waters near the Crofton pulp mill on Vancouver Island, neither the federal nor the provincial Governments have done anything to stop this pollution of our environment. Tests have shown unacceptable levels of 2378TCDD, one of the most dangerous dioxins known in samples of crab and oyster.
In light of this, what steps is the Government taking to ensure that this poisoning of our environment by pulp mills will stop, and what steps is the Government taking to guarantee to Canadians that the seafood they eat is safe?


Hon. Tom McMillan (Minister of the Environment):: Mr. Speaker, the Hon. Member has said that Environment Canada has done nothing in the area to protect human health and the natural environment in the face of the problem he has identified. Nothing could be further from the truth.
The Department of my colleague, the Minister of Fisheries and Oceans, and my own department have been working together intimately in this area. We are conducting extensive analyses and have been monitoring the situation carefully. Our respective officials have been instructed to keep the two of us well informed and the issue is being dealt with as a matter of real priority and urgency.


ALLEGED DUPLICITY IN TEST RESULTS-RELEASE OF ALL TEST RESULTS
James Douglas Manly: Mr. Speaker, the analysis and the monitoring is way behind time. The poisoning continues.
On January 18, the Minister of Fisheries announced test results for the Harmac area which showed that dioxin levels were within acceptable range. Why did the Minister not announce earlier test results which showed unacceptable levels of dioxin near Crofton? Why is there this duplicity?
Will the Government make a commitment now to release all test results so that Canadians will know what is in their waters?


Thomas Michael McMillan: Mr. Speaker, the Member talks about duplicity. There is no such duplicity. Analyses are being conducted. We have employed the top experts in the country. We have consulted experts beyond our shores on this subject to make sure that the
March 2, 1988

Government of Canada has the very best advice in the world on the matter. Nothing has been kept secret. These analyses take a lot of time. Some of them take weeks in order to get the level of scientific certitude we think we need to make the relevant decisions.
I will be more than pleased to share with my hon. friend, and through him with any other interested Member of the House, the information that flows from the analyses.


AGRICULTURE
Mr. Mel Gass (Malpeque):: Mr. Speaker, my question is for the Minister of Agriculture. Some time ago it was announced that money would be forthcoming for potato stabilization.
I know there have been discussions regarding how this money should be paid to the producers and there have been numerous suggestions as to how it could be paid. There are great expectations and uncertainty in the industry.
On what basis will this money be paid and when can the producers expect the cheques to be in the mail?


Hon. John Wise (Minister of Agriculture):: Mr. Speaker, I welcome this question because it provides me with an opportunity to again announce on behalf of the Government more good news for Canadian potato farmers. We indicated some time ago that we would honour the 1985 commitment. Indeed, we are doing that today.
The Hon. Member should recognize that some time ago we entered into an agreement with the Province of Prince Edward Island and the Province of New Brunswick under which we contributed to a diversion program on a 50-50 basis. At the same time, in that same crop year, we also paid $1 million in lieu of a surcharge in the Province of British Columbia. Therefore, in all fairness, we had to net out the amount of potatoes that qualified for the diversion program in Prince Edward Island and New Brunswick. Indeed, we had to net out the amount of potatoes in relation to the $1 million payment in lieu of surtax. We did that to ensure fairness and equity in the calculation.
The cheques will be in the mail within the next two weeks, but we do not work in isolation or unilaterally. I am aware of the debate that continues in the Province of Prince Edward Island with respect to the method of payment and we will withhold the cheques to that province until such time as I am satisfied that the people in the industry have decided what manner we should follow in making the payment.
Oral Questions


EMPLOYMENT
Mrs. Lucie Pepin (Outremont):: Mr. Speaker, my question is directed to the Minister of Employment and Immigration. Yesterday, we were informed by Statistics Canada that 61 per cent of the labour force is made up of women, that as much as 62 per cent of mothers with children under six years of age are working full-time and that, as far as women are concerned, part-time employment is progressing more quickly than fulltime employment.
I should like the Minister to tell us why the Tory Government has done absolutely nothing on the issue of part-time employment, in view of the fact that in 1984 the Prime Minister had promised to take very quick action. It was one of his election campaign. When is the Government going to take action on this issue and give something to part-time female employees?


Hon. Benoit Bouchard (Minister of Employment and Immigration):: In my opinion, Mr. Speaker, my Honourable friend should recognize first of all that this Government has probably the best record over the past several years in the area of job creation. According to the same statistics, 90 per cent of all jobs are held by women. As far as improving the situation is concerned, I feel again that my Honourable friend should fully recognize that the real employment situation for all Canadians, and especially for women, has improved.
Again, in the area of part-time employment, a large percentage of women in the labour force are involved in it voluntarily. I will admit with my colleague, however, that there is room for improvement, and suggest that if we had not been saddled with the situation which prevailed before 1984, it would be lot easier to go ahead now.


PARENTAL LEAVE-GOVERNMENT POLICY
Lucie Pépin: Mr. Speaker, it seems that the Minister and myself have different ways of reading the statistics. I would like to tell the Minister that the majority of women who work part-time do not do so voluntarily. The statistics clearly show that there have been a greater number of part-time jobs, and I would simply like to remind the Government that one of its promises was to provide social benefits for part-time workers, which it has certainly not done to this time.
In addition, Mr. Speaker, the Prime Minister and the other Conservatives promised in 1984 to extend parental leave to provide easier access to the labour market for women. I would like to know why the Conservative Government has not followed up the two reports tabled in this House which dealt with parental leave, namely the Forget report and the report on child care. In its response to the report on child care, the Conservative Government did not even refer to parental leave. Is it the new policy-

March 2, 1988
Oral Questions


Mr. Speaker:: I am sorry, but I think that the Hon. Member has asked her question.


Benoît Bouchard: Mr. Speaker, I am sorry to contradict my colleague, but we have indeed provided social benefits for parttime workers, by allowing them to contribute to the pension plan, for instance. The Hon. Member must admit that we have extended eligibility to the pension plan. 1 must also contradict the Hon. Member on another point and tell her that 85 per cent of all jobs created have been full-time jobs.
Mr. Speaker, I have another correction to make as concerns maternity leave. As I have already told the Hon. Member, the Conservative Government has done more than any other Government before, for instance in the matter of employment equity, and I would remind my colleague about the Employment Equity Program and the Federal Businesses Program. Mr. Speaker, I know that the Hon. Member has to ask her questions, but she is well aware that, if her party had done as much as we have done, we would be 20 years further ahead as concerns jobs for women.


ENVIRONMENTAL AFFAIRS
Ms. Lynn McDonald (Broadview-Greenwood):: Mr. Speaker, my question is directed to the Minister of the Environment and concerns pollution by dioxins on the other coast, in the Miramichi.
Will the Minister confirm that he inadvertently, I am sure, misinformed the House when he replied to a similar question the last time, and that in fact there is no cleanup going on there and the citizens in the area have not even been given the results of tests which have been conducted?
Will the Minister assure the House that he will exercise the powers he has to ensure that there is a thorough cleanup and that we will not have an increase and spreading of the pollution which has been there for some decades?


Thomas Michael McMillan: Mr. Speaker, I think the Hon. Member is referring to an answer I gave in the House to a question she posed on February 4. I must confess to the Hon. Member, and to you, Sir, that I probably over-stated the case when I did respond. I said that a cleanup was under way and that an excavation had begun. The truth is that preparatory work had been started but it was entirely preliminary. The actual cleanup had not actually been started.
The Government of Canada, through my Department, is riding herd on the company. The provincial Department of the Environment is the main instrument for government action in this area because of the jurisdictional question, but we are cooperating hand in glove. The Hon. Member can have from me the assurance she has sought.


Mr. Speaker:: I regret to say to the Hon. Member that given the hour, she is limited to one question. I recognize the Hon. Member for Glengarry-Prescott-Russell on a single question.


CONFLICT OF INTEREST
Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, in the absence of the Prime Minister, my question is directed to the Deputy Prime Minister. On February 24, the Prime Minister tabled in the House his new Bill concerning conflict of interest.
Notwithstanding the fact that the Bill does not cover all applications or senior civil servants, it still enjoys the support of at least a majority of members of all Parties of the House. Given that the Bill enjoys that kind of support with all Parties, can the Deputy Prime Minister commit himself here and now to bring forward the Bill for second reading no later than this week or, at the latest, Monday of next week?


Hon. Don Mazankowski (Deputy Prime Minister, President of the Privy Council and President of the Treasury Board):: Mr. Speaker, we intend to move with this legislation very soon.


Mr. Speaker:: I recognize the Hon. Member for Lambton- Middlesex on a single question and that will end Question Period.


AGRICULTURE
Mr. Sid Fraleigh (Lambton-Middlesex):: Mr. Speaker, my question is directed through you to the Minister of Agriculture. A cloud is hanging over the federal meat inspection system due to media reports in the Kitchener-Waterloo area and some poorly phrased questions in the House. Not only is the system under attack but also those people who supply the services, the inspectors.
Will the Minister today inform the House if there exists a particular problem with meat inspection in southern Ontario and, if so, what has been done to correct the situation?
March 2, 1988


John Wise: Mr. Speaker, I appreciate the question. The direct answer to the Hon. Member's question is no. 1 think we have to appreciate that there are some 1,500 competent, well qualified, dedicated meat and food inspectors working on a day-to-day basis in over 800 plants across the country. They approve wholesome food for the Canadian public and, indeed, for people in our export markets, well in excess of three million metric tons a year.
We have to recognize that on a day-to-day basis, these inspectors search for improvements in the system, they find improvements and they implement improvements. Our staff continues to strive for perfection. 1 can assure the House that, indeed, at no time was the quality of Canadian food for Canadian consumers ever jeopardized.



ROUTINE PROCEEDINGS


[Stage Direction]
A message from Her Excellency the Governor General transmitting Supplementary Estimates (E) for the financial year ending March 31, 1988, was presented by the Hon. Don Mazankowski (President of the Treasury Board) and read by Mr. Speaker to the House.

Donald Frank Mazankowski: Mr. Speaker, pursuant to the provisions of Standing Order 83, I move, seconded by the Hon. Minister of State for the Treasury Board (Mr. Lewis):
That Supplementary Estimates "E" for the fiscal year ending March 31,
1988, laid upon the Table earlier this day, be referred to the several Standing
Committees of the House as follows:
Because the list is rather long and there is a detailed allocation of the Supplementary Estimates to the committees, I would ask that the list be printed in Hansard as if it had been read.


Mr. Speaker:: Is that agreed?


Some Hon. Members:: Agreed.
[Editor's Note: List referred to above is as follows:]
To the Standing Committee on Aboriginal Affairs and Northern
Development
Indian Affairs and Northern Development, Votes 15e, 26e 35e.
To the Standing Committee on Agriculture
Agriculture, Votes le, 15e and 35e.
To the Standing Committee on Communications and Culture
Communications, Votes le, lOe, 25e, 30e, 45e, 70e and 85e.
To the Standing Committee on Consumer and Corporate Affairs
Consumer and Corporate Affairs, Votes le, 5e and 23e.
To the Standing Committee on Energy, Mines and Resources
Energy, Mines and Resources, Votes 25e and 55e.
Tabling of Documents
To the Standing Committee on Environment and Forestry Agriculture, Vote 20e.
Environment, Votes, 5e, lOe, 20e and 25e.
To the Standing Committee on External Affairs and International Trade External Affairs, Votes le, lOe, L17e and 30e.
To the Standing Committee on Finance and Economic Affairs Finance Vote, LI le.
National Revenue, Votes le, 5e and lOe.
To the Standing Committee on Fisheries and Oceans Fisheries and Oceans, Votes le, 5e and lOe.
To the Standing Committee on Government Operations Consumer and Corporate Affairs, Votes lOe and 17e.
Governor General, Vote le.
Parliament, Vote le.
Public Works, Votes le, 2e, lOe, 25e, 35e, 36e, 40e, 50e, 55e, 80e, 85e and 90e.
Supply and Services, Votes le and 5e.
Treasury Board, Vote L35e.
To the Standing Committee on Justice and Solicitor General Justice, Votes le, 5e, 15e, 25e and 40e.
Solicitor General, Votes 5e, 25e, and 30e.
To the Standing Committee on Labour, Employment and Immigration Employment and Immigration, Votes le, 5e, 6e, 15e, 20e, 21e and 30e. Labour, Votes le and lOe.
To the Standing Committee on Multiculturalism
Secretary of State, Votes le and 5e (portions dealing with Multiculturalism) To the Standing Committee on National Defence National Defence, Votes le, 5e and lOe.
To the Standing Committee on National Health and Welfare National Health and Welfare, Votes le, 5e, lOe, 15e, 35e, 45e and 65e.
To the Standing Committee on Regional Industrial Expansion Atlantic Canada Opportunities Agency, Votes le,5e and LlOe.
Indian Affairs and Northern Development, Votes 50e and 55e.
Regional Industrial Expansion, Votes le, lOe, lie, 15e, 51 e and 55e.
To the Standing Committee on Research, Science and Technology Science and Technology, Votes le, 25e and 30e.
To the Standing Committee on Secretary of State
Secretary of State, Votes le and 5e (except Multiculturalism portions) and Vote 25e.
To the Standing Committee on Transport
Transport, Votes le, lOe, 1 le, 20e, 21e, 22e, 23e, 30e, 60e, 65e and 70e.
To the Standing Committee on Veterans Affairs Veterans Affairs, Votes le and 25e.
That the Privy Council Vote 15e be referred to the Standing Joint Committee on Official Languages. That a message be sent to the Senate to acquaint Their Honours thereof.


[Stage Direction]
Motion agreed to.
[Stage Direction]
March 2, 1988
Petitions

Donald Frank Mazankowski: Mr. Speaker, I wish to table, in both official languages, the Crown Corporations quarterly report to Parliament, fourth quarter, 1987.


SIKH ORGANIZATIONS
Charles Joseph Clark: Mr. Speaker, pursuant to Standing Order 67(2), I rise to table, in both official languages, the text of my letter to a number of provincial Premiers concerning the activities of three Sikh organizations in Canada.


PETITIONS
Mr. Jim Hawkes (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 Petitions Nos. 332-3714 to 332-3720 inch, 3323729 to 332-3738 inch, 332-3744, 332-3746, 332-3823 to 3323832 inch and 332-3901.



APARTHEID


Charles Joseph Clark: Mr. Speaker, I have been away from the House and I wanted to take the first opportunity available to me to report to Parliament upon recent events in South Africa and to discuss what Canada should do.
Canada's position in the international fight against apartheid is both important and well known. Part of our strength is that we have taken our decisions deliberately and generally kept the issue beyond the normal divisions of domestic Canadian partisanship. I report today in that spirit.
One week ago, the Government of South Africa banned political activity by 17 organizations including trade unions and the major coalition committed to non-violence. Three days
ago, it arrested peaceful marchers. Yesterday, it introduced legislation to prevent foreign funding of anti-apartheid activity and to restrict peaceful dissent still further.
Pretoria seems intent on closing the door to peaceful change. Its actions invite violence because they leave nothing else. Those actions are perverse and they are brutal. One might hope that they are designed merely for temporary electoral advantage, but we fear that they reflect a policy of deepening repression. A situation already bad has been made much worse.
In these circumstances, countries like Canada which oppose apartheid must review the nature and the effect of all our relations with South Africa. We hope that will happen in all countries that prize democracy.

Sir, the Government of Canada, guided by the Prime Minister, has played a leading role in the fight against apartheid. Our previous governments followed the line taken by Western countries. This Government is trying to orient that line. Because of our considerable interest in the African continent, our role within the Commonwealth and la Franco-phonie, and our commitment to human rights, we feel this is a question on which we can speak with authority and where we can wield some influence. We have tried to use our political and economic influence to greater effect in the fight against apartheid. We are of course disappointed in the response of the South African Government. We have also had to re-examine the need for maintaining economic and diplomatic relations with a government that seems determined to put itself above the law.
Canada's policy has been, and still is, to do everything in our power to avoid a disaster, to put an end to apartheid and to bring in a representative government that would not be based on racial divisions. The Prime Minister and I have clearly stated on many occasions that if these attempts failed, we will break off diplomatic and economic relations with South Africa. Our policy has taken various forms: economic and other sanctions, diplomatic pressure, and assistance to victims and opponents of apartheid. I would like to deal with each of these elements separately.
With respect to diplomatic relations, Sir, the choice is basic. Do we walk away in disgust or do we try to use and build our influence despite our profound disappointment? The powerful temptation is to walk away, to conclude that the South African regime is so profoundly anti-democratic that only violence will change it. Certainly the latest actions by the Pretoria Government carry South Africa away from any pretense of democracy as western nations know democracy. South Africa's apologists claim their society is part of the West. If that is so, their actions now betray their heritage.
March 2, 1988

Some Members of the House call for the end now of diplomatic relations. I wonder, with respect, whether they have considered what that would mean. For example, the South African Government has embarked upon an intensified campaign of censorship and propaganda deliberately designed to mask the reality of apartheid. Maintaining an embassy in that country is effectively the only way in which we can continue to know what is really going on. There is a value to that, and a high cost if we close.
Again, a large part of our aid program, now valued at about $5 million a year, is delivered through the embassy. Without representation on the ground it would be much more difficult to identify, supervise and monitor projects which bring real help and visible support to the victims of apartheid. Literally hundreds of small people-to-people projects, the kinds of projects we mount through our mission administered funds, literally hundreds of those projects which help the victims of apartheid in South Africa would be ended if our embassy were to close. The growing use of travel restrictions imposed upon South African opponents of apartheid means we can maintain contact with them only through our embassy. They cannot come to us, we have to go to them. We cannot do that if we are not there.


Some Hon. Members:: Hear, hear!


Charles Joseph Clark: Again, in the world as it is, if we were absent from Pretoria we would have more difficulty mounting an aid program in Namibia, more difficulty advancing Canadian and Commonwealth-and I underline "and Commonwealth"-interest in South Africa, and no ability to demonstrate within South Africa itself our solidarity with anti-apartheid leaders.
The House may not know this, but whenever there is a trial on apartheid charges in South Africa accessible to our embassy, Canadian representatives are there. Whenever there is a need for solidarity with opponents of apartheid to be demonstrated physically, as when Bishop Tutu was marching three or four days ago in Pretoria, Canadian embassy representatives, the spouse of the ambassador among them, were there. Those are the kinds of things, those are the kinds of symbols that we put at risk if we close our embassy, and I ask Members who recommend that measure to consider carefully what it means.
There are countless other examples that must be considered in any serious discussion of the future of our embassy. Of course, it is valid to ask, as the Hon. Member for Windsor- Walkerville (Mr. McCurdy) asked yesterday in this House, when would it be appropriate for Canada to withdraw? Sir, I do not know the answer to that question. Probably no one knows the answer to that question today. However, in all the circumstances it is the Government's considered view that this is the wrong time for Canada to walk away or cut ourselves off.


Some Hon. Members:: Hear, hear!
Statements by Ministers


Charles Joseph Clark: The issue of our economic relations is not as clear-cut. The South African Government is very anxious to maintain its economic links with the rest of the world, and is also keenly aware of its increasing isolation from the international community. Economic sanctions undoubtedly have an economic and psychological impact. The impact is even greater when sanctions are more broadly based. As 1 pointed out to the House on February 5 this year, the Commonwealth Committee of Ministers of Foreign Affairs is now gathering data and hearing recommendations that my lead to expanding, reinforcing and intensifying the application of sanction. This is becoming an increasingly urgent task, and I have already contacted my colleagues on the Committee to see how we could accelerate this program.

In addition, Sir, there are independent economic and political actions which Canada might take, including the relatively small measures for which I already have cabinet authority. Our experience is that since Canada's trade with South Africa is less than 1 per cent of South Africa's total trade, our action is more effective when it is in concert with or as catalyst to actions by nations whose economic impact is greater.
We are actively reviewing two aspects of that policy. First, to see if there are new economic measures which Canada might take effectively alone. Second, to encourage broader action, particularly by countries who prize democracy, in specific response to South Africa's multiple assaults upon freedom during the last week.
With that in mind, on the political side, we have contacted several other western Governments. Those discussions must remain confidential for the moment, but I would certainly be prepared to discuss privately with the two opposition spokesmen, the Right Hon. Leader of the Opposition (Mr. Turner) and the Leader of the NDP (Mr. Broadbent), the kind of thing we are considering in discussions with other countries.
A third focus of our activity has been upon the opponents and victims of apartheid. Their need is suddenly more urgent. The peaceful opponents of apartheid are under renewed attack. They need our assistance and we intend to provide it. We have already increased our aid for education, to the labour movement, and for humanitarian and legal aid. The challenge now is to move more money, more quickly, to the opponents and victims of apartheid.
An obvious priority is the labour movement. We provide funds to various unions in South Africa and we will provide more. Most of these funds will be channelled through the Canadian Labour Congress, the Canadian Teachers Federation, and the Confederation des syndicats nationaux. I have instructed my officials to act urgently on precise programs submitted by those organizations.

March 2, 1988
Statements by Ministers
We will also provide new forms of assistance. For example, undoubtedly there will be challenges in court to the regulations and laws just introduced. We will take up with anti-apartheid organizations in South Africa the ways in which we would be able to help fund those court challenges.
Canada has objectives which we must pursue in support of peaceful change and dialogue. They are legitimate objectives and they are reasonable objectives. We intend to pursue them. Up until now we have been able, through our embassy, to carry out our programs in South Africa. That is why the embassy is there. If implementation of the various measures announced this past week by Pretoria prevents us from accomplishing our goals, then we will have to consider again whether our presence is justified.
The struggle in South Africa, Sir, has entered a new stage, more dangerous, more frightening. The Eminent Persons Group warned of massive bloodshed, and last week the South Africa Government pushed the region closer to that nightmare. As new rules repress opponents of apartheid within South Africa, those of us outside must become more effective and more imaginative in our initiatives. The response of Canada is particularly important because of the practical leadership we have exercised since the Nassau Conference. This is not a time for Canada to withdraw.
Quite the contrary. Our position is known and respected. What we need, indeed what I need from this House and other Canadians, are practical suggestions and initiatives that we can take, little steps and large steps, to make progress against apartheid. An interesting suggestion was made yesterday by my colleague, the Member for Winnipeg-Birds Hill (Mr. Blaikie), regarding the Security Council of the United Nations, and we are examining that proposal.
We are increasing our help to the victims of apartheid, considering how we respond specifically to the Draconian new measures of last week, and we are discussing with our allies of the Commonwealth, the summit and elsewhere what new actions nations might take together.
Our Ambassador to South Africa has been back in Canada for a meeting of African Heads of Post and will be staying here a little longer for consultation. As there are new developments, I will report them to the House.
This Parliament has shown an active and nonpartisan interest in the fight against apartheid. The Prime Minister (Mr. Mulroney) and I accept and exercise the Government's responsibility to lead on this issue, but naturally we would continue to be interested in practical suggestions from other Members and other Parties in the House of Commons.


Some Hon. Members:: Hear, hear!


Hon. Andre Ouellet (Papineau):: Mr. Speaker, first, 1 wish to thank the Minister for his kindness in sending me a copy of
his statement earlier today. I also wish to welcome him back to this House after being kept at home by the flu for a short time, and I hope that he is now better.
Unfortunately, there is nothing new in the statement we have just heard. I must say from the start that it certainly does not surprise me. In fact, the Minister has restated what he told this House on February 5 following the meeting of the Committee of Commonwealth Foreign Ministers in Lusaka, Zambia. Indeed, his statement that time was not that much different from what he said on November 18, 1987, when he announced the first meeting of the Committee. In fact, Mr. Speaker, the Minister is working quite hard.
We do not question his good will. On the contrary, we congratulate him for his faith in the future and his determination to find a solution to apartheid through normal diplomatic channels.

We Liberals have to say that we have been frustrated over many years while in Government by this slow process which, we must say, is going absolutely nowhere. We absolutely no longer believe in it. We are of the opinion that the Botha Government cannot and will not be influenced by kid-glove diplomacy. I must add with regret that the recent actions of the Pretoria Government sustained our convictions on this side of the House.
Last week South Africa banned 18 predominantly black organizations from political activity, including the largest antiapartheid coalition and the largest labour federation. Yesterday the Government introduced legislation, the latest of a series of moves clamping down on opponents of the apartheid regime.
What we know so far of this legislation, called the Promotion of Orderly Politics Bill, is that it will prohibit all organizations from receiving money from abroad for political purposes and will empower the South African Justice Minister to seize foreign sums received by certain groups. His powers will be indefinitely retroactive. Clearly, the move could cripple antiapartheid groups and churches thus far spared from the new crack-down on opposition. Even worse, we are told that no court challenge of the restrictions would be allowed.
The Minister told us today that he urgently wants to send more money. Will the money arrive on time? Will this money have any impact under the current circumstances? Is it not too late? The clear intention of this Bill is to stop Canadian funding in South Africa. It will inevitably kill what has become one of the most visible policies in Canada's battery of attacks on the apartheid regime. Clearly, the actions of the South African Government are not aimed exclusively at Canada but certainly undermine whatever action the Canadian Government wants to take in South Africa.
We know, as the Minister certainly knows, that the trade and economic sanctions are almost fully imposed and are having little if any effect at all. The Canadian Government has
March 2, 1988

rested all of its presence in South Africa on one thing-not the sanctions, because they are not working, but on the aid that Canada could send through South Africa, reaching into South Africa to support the victims of apartheid.
We Liberals believe that as honourable as these efforts are, they are no longer, and 1 am afraid to say have probably never been, a solution. It is clear now that the Government of South Africa will never accept the introduction of non-racial representative governments. Unless bold action is taken, the diplomatic soft glove approach will never succeed.
I submit that the Pretoria Government has made a declaration of war on peace, justice, and human rights. We are now, more than ever, in a position to cut our relations there. The time has come to do it in the face of what has been taking place in South Africa.
The Minister may have genuine aspirations, but I submit that his declaration is a repetition of a number of things which have been said in the past and it will not work. When the Prime Minister of Canada (Mr. Mulroney) spoke at the United Nations he got applause and praise, not because of his effort there but because he said that he was ready soon to cut diplomatic relations with South Africa. That is when he got the applause.
I regret very much the Minister's portrayal of our suggestions of breaking diplomatic relations as walking away, as cutting ourselves off from this problem. This is not true. This is not what we have been saying and it is certainly not the view of the Liberal Party of Canada which has been constantly, for many years, against apartheid and continues to be against apartheid. We continue to be against apartheid. But we want to venture into new avenues to find a breakthrough in this area.
We have never said and are not saying that the Government should stop its actions within the Commonwealth. We have never said and will never say that the Government should stop supporting the South African Development Co-ordinating Conference.
Canada could show leadership by breaking relations with South Africa, bringing about the realization once and for all that there is no future in trying to convince the Botha Government through the diplomatic route.

Canada will host the next Economic Summit in Toronto, next June. The Prime Minister (Mr. Mulroney) should use this opportunity to convince his allies to apply real economic pressures in an effort to weaken the will of the Pretoria Government.
I believe that the Minister can and should continue his work with the Commonwealth Foreign Ministers but to do so, he does not have to maintain diplomatic relations with South Africa.
Statements by Ministers

He said in his remarks that the question of economic relations is less clear-cut. The South African Government is extremely sensitive to both its economic link with the world and its growing isolation in the international community. Economic sanctions undoubtedly have an impact economically and psychologically. That impact is greater when those sanctions are more broadly supported.

This is what we are saying. The Government must initiate talks with the United States and the member countries of the Group of Seven, which could impose strong enough economic sanctions to make the South African Government change its position.
I was suprised that the Minister did not refer to the comments of the Secretary General of the Commonwealth, who proposed yesterday a five-point plan which should receive our enthusiastic support. The Secretary of the Commonwealth said the following:

"A widening, tightening and intensification of economic and other sanctions should be imposed by the United Nations". We support that. Second: "Increased pressure by Third World countries on those western countries that have not imposed tough economic sanctions". This is a route to follow.
Third: "A ban by black-ruled African countries on the use of their air space by airlines flying to South Africa". That is another proposal that should be very carefully considered and implemented.
Finally: "A concerted international demand on the Botha Government to enter into power-sharing negotiations with South Africa's black majority". Clearly, this demand will not be answered by the Botha Government unless countries like Canada are prepared to take bold initiatives. One of those initiatives is for us to show the lead and cut our ties.
I note that our ambassador is now in Ottawa and that the Minister said he wants to retain him for further consultations. I suggest that he should retain him as long as possible. In other words, until the Botha Government has not begun talking with the black leaders of South Africa to share authority in government in South Africa.


William Alexander (Bill) Blaikie: Mr. Speaker, let me begin by thanking the Minister for reporting to the House. We are glad to have him back on his feet after his having been confined to bed for the last week or so. I must say that we have missed him due to the many questions we would have liked to ask him. We will try to make up for that in the coming weeks.
The Minister began his statement by saying that he reports in the spirit of nonpartisanship which has attended this issue. While that is certainly the case with respect to the mutual and commonly felt abhorrence of all Canadians and Members of Parliament toward the apartheid regime in South Africa, I

March 2, 1988
Statements by Ministers
hope the Minister will also respect the fact that within the boundaries of that nonpartisanship there is room for honest and profound disagreement about the appropriate Canadian response to that issue. It is in that spirit that I, on behalf of my Party, offer our criticisms of the statement made by the Secretary of State for External Affairs (Mr. Clark).
I honestly believe that the measured tone and lack of new initiative today does not do justice to the fundamental objections Canadians have expressed to the actions taken by the South African Government in recent days. When one considers the obvious slap in the face given to the Minister and his colleagues in Lusaka recently by the South African Government, basically ignoring the Commonwealth group, it seems that the Minister spoke more calmly than might have been in order. The South African Government has made it clear that it does not really care about what the Minister and other Commonwealth leaders think. It has basically told them to get lost.
1 suggest the time has come not only for action but for more passion in the response of the Canadian Government to what has happened in South Africa.
Nothing could be more offensive to me and, I am sure, to many others than knowing that South Africa permits neo-Nazis to march down the street without government harassment while, only days later, Bishop Tutu, Reverend Boesak and other leaders in the Christian community are arrested for a peaceful demonstration against apartheid. As a Christian myself, 1 am sure all Canadians, Christian and non Christian, feel the same repugnance at this obvious affront to democratic principles, freedom of speech, and the very possibility of nonviolent action against apartheid in South Africa.
The approach taken by the Minister in his statement suggests a certain innocence. I am not sure whether it is a studied innocence, or a naive innocence, but it is there. For instance, he acknowledged that only yesterday it was announced there would be legislation to prevent foreign funding of anti-apartheid activity, yet later in his statement he talked at great length about how the Canadian Government intends to step up its support of anti-apartheid activity in South Africa through the Canadian Labour Congress and various other avenues open to the Canadian Government. Does the Minister not see that this declaration of war on peace and justice that the Liberal spokesman referred to is also a declaration of war on Canada's anti-apartheid activity? Some of the Minister's own officials have implied that this legislation may indeed be targeted at Canada. Perhaps it would have been appropriate for the Minister to respond to that and indicate how the Canadian Government intends to overcome the obvious intention of the South African Government to frustrate the very policies on which the Minister states the Government will now put even more emphasis.
Not only are the Front Line States that are opposed to apartheid in South Africa to be harassed, those in Canada and
other parts of the world who choose to actively support antiapartheid groups in South Africa are to be harassed as well.
The Minister says that as a result of recent events, South Africa policy is under review. I would have thought that the Department of External Affairs would have had at least anticipated that something like this might happen some day. It might have had a contingency response available so that when the South African Government did act in the way it has, Canadian action could have been swift. It could be shown that we do not have to dither over our response to this kind of action. Unfortunately, that is not the case.
It seems to me and my colleagues that the Minister, at the very least, could have proceeded-and we realize this is a significant action, but significant events are taking place which call for a significant response-to announce a Canadian policy of mandatory and comprehensive economic sanctions against South Africa. That would have been a clear response on behalf of Canada. That would have been in concert, I believe, with the level of concern all Canadians feel about apartheid in South Africa.
We might constitute 1 per cent of trade with South Africa, but we are not talking about a statistical reality, we are talking about a political reality, a symbolic reality and a moral reality. Whether it is 1 per cent, 10 per cent or 40 per cent, in the final analysis it does not matter that much.
With respect to the question of diplomatic relations, the position of the New Democratic Party is different from that of the Liberal Party. We accept some of the arguments made by the Minister for maintaining some kind of diplomatic presence in South Africa. However, we certainly take the view that the time has come for a downgrading of our diplomatic recognition of South Africa. The opportunity presents itself because the ambassador is here in Canada. It is certainly an opportunity for the Minister to discuss with the ambassador how that might be done. I believe we have to take action both on the economic and the diplomatic front. I would recommend that to the Minister. Other avenues which are available on the diplomatic front are things we suggested yesterday, having to do with the United Nations and the Security Council. We hope some of those avenues might be constructively pursued.
With respect to the question of breaking off diplomatic relations, I say to the Minister that I believe what he has found frustrating about the current debate is due in part to the repeated assertions by the Prime Minister (Mr. Mulroney) that this is something that Canada is prepared to do, and not in some far away mythological time, but a very real possibility under certain circumstances. The call from some quarters for a break-off in diplomatic relations is attributable in part to the Prime Minister repeatedly mentioning this as a possible Canadian response when the time comes. As to that time, 1 agree with the Minister that it is never possible to know when that time is.
March 2, 1988

With respect to economic sanctions, I think sometimes there is a tendency to talk about them without anyone actually elucidating exactly what that would involve. What do we export to South Africa? I am told, having checked with the Interchurch Task Force on Corporate Responsibility, that one of our major exports to South Africa is sulphur. In 1986, the last year for which statistics are available, sulphur made up some 39 per cent of our exports to South Africa. This is one step the Government could take if it were to impose mandatory sanctions. The sulphur that goes to South Africa is used to make fertilizer which is, in turn, sold to the Front Line States. It has been suggested, I am told, that instead of being exported to South Africa, this sulphur could be exported to the Front Line States as part of an aid project and they could begin to make their own fertilizer with the sulphur, which would have the double effect of instituting both sanctions and less dependency by the Front Line States on South Africa. This proposal, 1 understand, is only in the embryonic stage, but 1 suggest to the Minister that it is a course of action which should be looked into.
We export small amounts of many other things to South Africa, potash from Saskatchewan, wheat, wood pulp, mining machinery and man-made fibres from Ontario, tungsten from British Columbia, folding cardboard boxes from Quebec. All these things, of course, are not going to break the back of the South African Government, but that is not the point. We want the Government to show leadership, to act, not just on behalf of Canadians but on behalf of all the people of the world who are concerned about apartheid, by taking these kinds of actions. We think that would have the effect of making it more possible, not less possible, for the Secretary of State for External Affairs to get the kind of widespread co-operatively decided upon sanctions to which he so often refers.
I ask the Minister what he means when he talks in his statement about sanctions being more broadly supported. Is he hopeful we can bring the United States, and Britain in particular, on side in more decisive action? Perhaps that is the kind of thing he intends to let us in on if we take him up on his offer to have meetings. I can say now that we are open to having those kind of consultations and we appreciate the offer.
Finally, I feel, and 1 think my colleagues also feel, that there is something far too gentle about this response on the part of the Canadian Government. Today was a day in which history could have been made in terms of a Canadian response to apartheid in South Africa. Instead, the Minister has persisted in his policy. I think it is a policy he sincerely holds, but nevertheless it is a policy that is starting to undermine, in my judgment, the well-deserved reputation of the Prime Minister and the Minister with respect to apartheid. I believe the leadership they have shown has arisen out of a genuine sincerity with respect to this issue. It has not been a political tactic. However, I think the time has come for some form of action to be taken by Canada by itself. It could have happened today and it did not. We regret that. However, we offer to
Petitions
continue working with the Minister towards the day when that kind of Canadian action will be taken.



ABORIGINAL AFFAIRS AND NORTHERN DEVELOPMENT


Mr. Lawrence I. O'Neil (Cape Breton Highlands-Canso):: Mr. Speaker, I have the honour to present the fourth report of the Standing Committee on Aboriginal Affairs and Northern Development.
[Editor's note: See today's Votes and Proceedings.]



BORROWING AUTHORITY ACT, 1988-89 BILL C-109-CHANGE IN REFERENCE OF BILL

['I wish to inform the House that, because of the ministerial statement, Government Orders will be extended by 39 minutes. The Hon. Member for Yorkton- Melville (Mr. Nystrom).']
Hon. Doug Lewis (Minister of State and Minister of State (Treasury Board)):: Mr. Speaker, there have been discussions among the Parties and I think you would find there would be unanimous consent to change the committee reference of Bill C-109, an Act to provide borrowing authority, so that the Bill will stand referred to the Standing Committee on Finance and Economic Affairs rather than to a legislative committee, and I would so move.


[Stage Direction]
Motion agreed to.

Mr. Benno Friesen (Parliamentary Secretary to Minister of Employment and Immigration):: Mr. Speaker, I have the honour to present a petition on behalf of a number of my constituents, as well as residents of Vancouver, Langley and Clearbrook. They state the fact that they are opposed to abortion on demand. They call upon Parliament to define human life as being created at the moment of conception and that that be reflected in a newly created law.


Mr. Elliott Hardey (Kent):: Mr. Speaker, it is my honour and privilege as a Member of the House to present this petition from residents of my riding which is known as Kent. It has been properly certified.
The undersigned residents are concerned about the void that has been created since Canada's law dealing with abortion was struck down by the Supreme Court. They feel that the

March 2, 1988
Petitions
provinces are off in different directions with this issue. They humbly pray that the Government provide the necessary leadership. They call upon Parliament to draft with as little delay as possible a new law which would be consistent with the Charter of Rights and Freedoms while providing effective protection for Canada's unborn children.


Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, it is my privilege to present a petition pursuant to Standing Order 106 from a number of residents of northern Canada who point out that the United States and Japan have proposed to fly plutonium over the Canadian North. They believe this represents devastating consequences potentially to both the Canadian environment and its people in the event of an accident or an act of terrorism. They are asking Parliament to recognize the dangers of such flights and to say no to the transport of plutonium over northern Canadian territory.


Nelson Andrew Riis: Mr. Speaker, 1 also have the pleasure to present another petition from a number of constituents regarding the trade deal with the United States. They believe that the federal Government lacks a mandate from the people of Canada to conclude this type of a trade deal with the United States.
They believe that this trade deal threatens the very fabric of our Canadian political and economic sovereignty since it removes the power of the Canadian Government to control foreign ownership.
They believe that it would deny Canada the policy freedom to determine its own economic future and thereby undermine our ability to build a distinct society from that of the United States of America.
They are asking Parliament now to dissolve to enable the people of Canada the opportunity to accept or reject the proposed trade deal during a national general election.


Mr. Dennis H. Cochrane (Moncton):: Mr. Speaker, it is my honour and privilege as the Member of Parliament for Moncton to present a number of petitions to the House in accordance with Standing Order 106. They are from constituents living within the federal riding of Moncton.
The petitioners express their belief in the total sanctity of human life and, specifically, that life begins at conception. Their concern emanates from the recent decision of the Supreme Court of Canada. They humbly pray and call upon Parliament to immediately pass legislation protecting innocent unborn children.


Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, 1 too have a petition that I wish to present on behalf of a number of citizens. It is on the trade issue.
A number of people have signed petitions stating that the federal Government has no mandate to negotiate a trade deal with the United States. They list a number of concerns about it. Finally, they ask that we dissolve Parliament so that we can have a national election on the issue.


James Douglas Manly: Mr. Speaker, the petition I present is duly certified and concerns the trade agreement that the Government has negotiated with the United States.
The petitioners point out that the Government had no mandate to negotiate such an agreement and that in the course of the negotiations Canadian sovereignty was compromised, something which it was specifically promised would not happen. The trade agreement threatens the very fabric of Canadian political and economic sovereignty. It removes our ability to control foreign ownership and to develop or 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.


Mr. Dan Heap (Spadina):: Mr. Speaker, I have two petitions to present. One is from a number of residents in Burnaby, North Vancouver, Maple Ridge and Salish Court. These people are concerned about the trade deal signed between the Prime Minister (Mr. Mulroney) and the President of the United States without any mandate from the Canadian people and in spite of a promise by the Prime Minister not to compromise Canadian sovereignty.
They point out that it completely fails to win secure access to the United States markets, which was the stated goal, and that it risks losing hundreds of thousands of Canadian jobs and that it would deny to Canada the freedom to choose policies that would direct our own future. In fact, it undermines our ability to build a society distinct from that of the United States.
Therefore, they pray and call upon Parliament to dissolve and to allow the people of Canada the opportunity to accept or reject the proposed free trade agreement during a national general election.


Daniel James Macdonnell Heap: Mr. Speaker, I have another petition from the residents of Spadina in which they remind Parliament that in February of 1985 the Government directed the Standing Committee on Justice and Legal Affairs to prepare a report on equality rights in Canada.
March 2, 1988

The committee duly reported to the House and, among other things, recommended that the Human Rights Act be amended to prohibit discrimination on the basis of sexual orientation in all areas under federal jurisdiction, including the RCMP, the Canadian Armed Forces and the age of consent legislation with regard to sexual orientation and practice.
They point out that the Government subsequently promised to take whatever measures are necessary to ensure that sexual orientation is a prohibited ground of discrimination but that the Government has not yet taken any significant action in this direction. Therefore they request Parliament to ensure that Government and Parliament act to implement the recommendations contained in the report as specified above with all due haste and speed, as in duty bound your petitioners will ever pray.


Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, pursuant to Standing Order 106 I have the duty and honour to table a petition in the House signed by residents of the Province of Ontario. They indicate in the petition that the trade agreement negotiated by the Mulroney Government threatens the very fabric of Canadian political and economic sovereignty by removing the power of the Canadian Government to effectively control foreign ownership and to develop Canadian energy resources in the best interest of Canadians or to equalize opportunities between regions.
They go on to point out that the proposed agreement not only denies Canadians secure access to the U.S. market that was the key objective in these negotiations but that it threatens the loss of hundreds of thousands of Canadian jobs.
Finally, the petitioners humbly pray and call upon Parliament to dissolve and allow the people of Canada the opportunity to accept or reject the proposed trade agreement during a national general election.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Frederick James (Jim) Hawkes: Mr. Speaker, question No. 254 will be answered today.


Mr. McKinnon: Has the expectation stated by the Minister of Supply and Services on December 8, 1986, that a final standard for outdoor long-term flags would be available by the end of 1987 and that standards for other uses (e.g. indoors)
Motions for Papers
would be available sooner, been met and, if so, on what date will flags conforming to these standards be available for public purchase?


Hon. Stewart Mclnnes (Minister of Public Works):: Considerable progress has been made toward a new standard for the National Flag for outdoor use (long-term).
The Canadian General Standards Board, lacking any regulatory authority, is not in a position to bring into effect all the provisions of the cited Act. At the present time it can only proceed with the development of a new National Standard of Canada to reflect current manufacturing techniques and materials.
Since the passage of the National Flag of Canada Manufacturing Standards Act, the representative CGSB Standards Committee has been reactivated to develop a new edition of the existing National Standard on the National Flag using the consensus process.
The Standards Committee identified the problem with the red portions of the flag and subsequent testing was necessary to eveluate various dyes and fabrics. It was agreed to expose various test flags on a continuous basis to conditions of actual use in the Toronto area. This testing was done by a private testing organization and was completed in December, 1987, and a report is expected by the end of February, 1988. The report will then be circulated to all members of the Committee and a meeting scheduled to prepare the revised standard. It is expected that the final standard for outdoor long-term flags will be available for the end of 1988.


Frederick James (Jim) Hawkes: Mr. Speaker, 1 ask that the remaining questions be allowed to stand.


Mr. Deputy Speaker:: The question enumerated by the Parliamentary Secretary has been answered. Shall the remaining questions stand?


Some Hon. Members:: Agreed.


Frederick James (Jim) Hawkes: Mr. Speaker, I ask that all notices of motion for the production of papers be allowed to stand.


Mr. Deputy Speaker:: Shall all notices of motions for the production of papers be allowed to stand?


Some Hon. Members:: Agreed.

March 2, 1988
Western Economic Diversification Act [Translation]


Mr. Deputy Speaker:: I wish to inform the House that, because of the ministerial statement, Government Orders will be extended by 39 minutes. The Hon. Member for Yorkton- Melville (Mr. Nystrom).



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from March 1 consideration of the motion of Mr. Mulroney that Bill C-113, an Act to promote the development and diversification of the economy of Western Canada, to establish the Department of Western Economic Diversification and to make consequential amendments to other Acts, be read the second time and referred to a legislative committee.
Lorne Edmund Nystrom: Mr. Speaker, the Bill before the House today is Bill C-113. It is a Bill which is very important in principle to establish a western diversification department and diversification offices across western Canada to try to diversify the economy.
The idea itself is very sound in principle in terms of diversification. It is very sound in terms of more decentralization in western Canada in bringing decision-making closer to the people. The question is, why should we diversify in the West? It is very important that we do so, because the economy of western Canada is extremely dependent upon resources, on one hand, and agriculture on the other hand. In both those cases, we are dependent upon the cyclical pricing nature of those commodities. The economy of western Canada depends a lot on what is happening in the New York stock market, the metal market, the commodity market in Chicago, or the international grain price. When things are going badly internationally, the price that the producer receives in western Canada goes down. That affects the entire economy. It has negative spinoffs, and a negative effect on jobs. Therefore, it is very important that there be some way of diversifying the economy of western Canada.
One of the concerns that I have, as do members of the general population in the West, is that the Government is not putting up very much money in terms of western diversification. Here we have $1.2 billion to be spent in four provinces over five years, which is some $60 million per year, per province, in western Canada.
In 1980 the former Liberal Government was criticized by the Conservatives across the way when it established the Western Development Fund of $4 billion over four years. That
was a little more money, and much of that money did not seem to appear either. It seemed to be a phantom fund. If the Government does not want to turn people off in western Canada, it is very important that there be some real money and funding of western Canadian diversification.
There are other areas where the Government could be doing more in terms of helping western Canadians. One area is procurement. I remember year after year Conservatives criticizing former Liberal Governments for not buying enough in western Canada and purchasing too many goods and services in Ontario and in Quebec, particularly in the Ottawa region of Ontario.
I have statistics here that are very interesting in terms of procurement of goods and services in western Canada. In 1981-82 in the four western provinces the federal Government purchased some 15.5 per cent of its supplies. The Department of Supply and Services contracts on a dollar basis in terms of western Canada indicate that 15.5 per cent of supplies were purchased in western Canada in 1981-82. By the time the Conservative Government took office in 1984, only 13.9 per cent of supplies were purchased in western Canada. The following year that went down to 12.8 per cent. Last year, in 1986-87, it went down to 11.5 per cent.
The Conservative Government claims to be very sensitive about the West. It has a lot of western representation and powerful Ministers from western Canada, for example, the Minister for International Trade (Miss Carney), the Minister of State for External Affairs (Mr. Clark), and the Minister of Justice (Mr. Hnatyshyn). Yet only 11.5 per cent of its purchasing is in western Canada. When the Government took office it was 13.9 per cent.
I suggest that this is one area where a lot more jobs could be created in western Canada if there were some regional equity in terms of the purchasing policy of the Government of Canada. Western Canada has approximately 27 or 28 per cent of the population, and the Government only purchases 11.5 per cent of its goods and services there.
Some people say it is because the West is so far away from Ottawa; it is too far away from the federal Government. I do not buy that. There are many government agencies in western Canada. There is much federal Government activity in western Canada. Western Canada has many service industries, and much of the purchasing could occur right in the West. The major point I make is that, not only is it 11.5 per cent of the share, but that share has gone down from 15.5 per cent in 1981-82, so there has been a sharp drop-off.
I notice there is a very influential Minister present who is in charge of the Treasury Board. Perhaps he could have some influence on those particular purchasing policies. The Minister is shaking his head in the negative.


Mr.   de Cotret@: I have not been President of the Treasury Board for six months. Wake up!
March 2, 1988


Lorne Edmund Nystrom: Ele is no longer President of the Treasury Board. Well, we did not notice the impact over here, Mr. Speaker. Perhaps he could have some influence on the purchasing policies of the Government, because he is a very influential Minister.
I understand that the Deputy Prime Minister (Mr. Mazan-kowski) is now in charge of the Treasury Board. We find that this has not helped. Here we have a western Minister and there is still this procurement policy of the Government where it is discriminating against western Canada. Members of the Government sit back and laugh about this discrimination against western Canada. It is no wonder that the Member for Edmonton-Strathcona (Mr. Kilgour) left that caucus and denounced the Government on its procurement policy in terms of lack of purchases in western Canada.
The second point I wish to make is in terms of the spending of the federal Government. Since this bunch of clowns took office three years ago, spending on regional development went down by some $3 billion. This Government stated that it would do a lot more in terms of spending in western Canada, spending in the North, and helping people in depressed regions. Yet less and less money is being spent in western Canada in terms of regional economic development than was spent before. The latest public opinion polls indicate that the current Prime Minister (Mr. Mulroney) is even less popular in western Canada than was Pierre Trudeau. No wonder. There has been a tremendous betrayal of the people of western Canada.
In a Government study it indicates that, in the last 25 years, federal government expenditures in regional development have been approximately 3 per cent of the Government of Canada's economic expenditures. That is a very small amount. The Macdonald Royal Commission on Economic Union and Development Prospects for Canada stated that a lot more must be done in terms of spending in regional development in Canada. They stated, "The Commission believes that regional development must remain an essential component of Canadian policy". The report further stated, "We recommend a new federal-provincial system of sharing regional development expenditures and responsibilities". The report also stated that they must have the insurance that there be a high level of infrastructural support.
The report goes on, and 1 wish to quote one further statement: "The Commissioners believe that the total federal financial commitment to regional development, combining of regional economic development grants and other funds spent through ERDAs should be increased significantly over the next two years".
This commission headed by Mr. Macdonald spent millions of dollars doing economic research in this country. They made recommendations that there be an increase in the spending on regional development in this country over the next few years. Yet the Conservative Party has been cutting back, cutting back, and cutting back on the amount of money it is spending
Western Economic Diversification Act
on regional development. I suggest once again that that is not fair, in the same manner as it is very unfair to be spending less and less on government procurement throughout the West.
Another point I would like to make in terms of western diversification is that we are going to have to diversify more from depending only on resources, fisheries, agriculture, and things of that type and diversify into high technology, advanced technology, and things of that nature. It is interesting to note that the OECD was asked by the four western provinces to conduct a study of innovation policy in western Canada. The OECD study team was in the West in the fall of 1985. Their report was released in early 1987. In that report they stated that the expenditure in terms of research and development in Canada as a whole is very low. The expenditure in western Canada is even lower. More funding should go to universities, industries, and fields such as biotechnology, electronics, telecommunications, and computer software. This study was commissioned by the four western provinces.
There are a number of other things that could be said about the importance of diversifying the economy in western Canada. Last spring our Party decided to spend some time in attempting to come up with a number of suggestions for the Government. We released a text of a western economic diversification statement in July. At that time we talked about the importance of diversifying the economy in the West. We started off by saying it was important to build on what we had. We have a very strong resource economy. We have all kinds of natural resources, gas, oil, potash, iron ore, things of that sort on which we should be building. Second, we should build on the very strong agricultural economy in western Canada as well as the very strong fishing and lumber economy located in the Province of British Columbia. We believe as a Party that a focus on diversification should involve as much regional and local control as possible where farmers and fishermen in the western towns, villages and cities have as much input as possible over decisions that affect their development and lives.
In the past we have had too many top heavy programs planned from Ottawa which have had little local input from local folks. Third, we suggested that more emphasis be put on small and medium-sized enterprises. All too often Governments rely on megaprojects and on spending money to subsidize large corporations, many of which are foreign and, again, all the requisite statistics will show that the smaller and medium-sized companies tend to be the ones which produce jobs, have more impact and give a lot more bang for the buck.
A lot of value could be added to our western resources. There are all kinds of jobs we are not getting because we tend to export many raw materials from western Canada without any processing, upgrading or some value added before exporting resources to other countries, primarily the United States.

March 2, 1988
Western Economic Diversification Act
We could create jobs in western Canada by servicing the needs of our resource industries. We have a great forest industry and yet the majority of the equipment for the forest industry is imported rather than produced in Canada. We have a mining industry in the West, but most of the mining machinery is imported rather than produced in western Canada. There is a tremendous amount of agriculture and farming in western Canada and, again, farm machinery is imported in the main rather than being produced in the West. A major reason is that we have free trade in farm machinery implements in western Canada and because of that we have lost our basic industry, most therefore is produced elsewhere, and we lose jobs and economic spin-offs.
We believe there is the possibility of developing some manufacturing industry in western Canada. In our paper we gave some examples of what can be done in Saskatchewan, Manitoba and British Columbia. Finally, there is the creation of new jobs in new industries, specifically advanced and high technology, where we should be diversifying. In places like Saskatoon we have some high technology industries that are doing very well, but we believe we could be doing a lot more work in that area right across the West.
What about the whole area of services? There are all kinds of service industries today creating many jobs. Then we have tourism. Tourism in the West could be promoted more than it is today, although we have been helped recently by the Calgary Olympics and by Expo 86 in the City of Vancouver.
Finally there is trade diversification. Since this Government has taken power a tremendous amount of time has been spent on a trade deal with the United State. A lot more emphasis could be put on trying to diversify our trade with other countries around the world. I noticed the positive statement in the press by the Minister for International Trade about being more aggressive in trading with Hong Kong as Hong Kong becomes part of China. We need to be doing more in China, which has a population of one billion people. The Pacific Rim is very important.
The United States is not quite as relevant to trade within western Canada as it is with Canada as a whole. The United States is still our number one trading partner and always will be. But in western Canada, in Saskatchewan in particular, other countries are important to us. The Chinese are important to Saskatchewan for grain sales and potash, but other Pacific countries are important also to the Province of Saskatchewan.
There are a number of other points that could be made, but I want to conclude by saying that we certainly support the principles of the Bill to establish a new department of diversification in western Canada. The important thing is for this department to have a sufficient supply of money to do a really meaningful and effective job. Some of the money the Government is now spending of the SI.2 billion is not new money. It is old money from other Departments recycled into a new department, a department of western diversification. One reason is to give it a higher profile to enhance the Conservative
Party's election opportunities. I say that because if it turns out to be the case, there will be more cynicism and more alienation in the West and more and more people will be looking for more and more radical options, something we cannot afford to play around with. At the moment we do not have very much support for western separatist Parties. That being said, there is still a great feeling of alienation in western Canada. The Western Canada Concept still exists, the Confederation of Regions Party still exists. It would not take much more to start fanning the flames of western independence and western separatism again. I urge the Government to put more money into this department, try to diversify the economy of the West and do something meaningful and creative to make those of us in western Canada feel that we are fully 100 per cent part of the great Canadian Confederation.


Frederick James (Jim) Hawkes: Mr. Speaker, it is a great pleasure to stand in the House today to contribute to this debate. I will attempt to keep my remarks relatively brief in the hope that opposition Party Members might also keep their remarks brief so we can move this legislation forward to committee, through the process, and have it in place as quickly as possible because it has been a long time in coming.
I was elected to this Chamber in May, 1979. I have felt for a very long time that the regions of Canada were sufficiently diverse. Instead of a centralized type of program which characterized the Liberal-NDP years control of this country I felt that we needed initiatives specifically related to the regions which might serve the needs of the people.
It is particularly interesting to hear the Member opposite as the first speaker for the New Democratic Party on this issue. He is a westerner. Our roots are not dissimilar, but I would like to make it very clear to the Chamber that the kinds of ideas we have about what is right and wrong in Canada and what needs to be changed arise from perhaps very different philosophical roots. I hear the Member opposite and I hear Members of his Party rather consistently saying, "We will stand up for the west".


Lorne Edmund Nystrom: Which we do.


Frederick James (Jim) Hawkes: That is the sort of thing that comes from the right-hand side of their mouths. But what about the left hand side of their mouths, Mr. Speaker? In 1979 we had a Government elected in Canada with a very strong western representation with a Prime Minister from the West. At the first available opportunity the NDP passed a motion in the House supported by the Liberals and threw the Government out of office. After so many years of lack of western representation, the New Democrats threw us out of office. We were left with four and a half close to five years of government with only two western Members sitting on the government benches and only one in Cabinet.
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What happened to the West? In my city, the unemployment rate went from 3.5 per cent to 12.7 per cent because of federal government policies oriented toward central Canada by a Government that perhaps knew no better, a Government supported in the assumption of office, in the first instance and continuously, by the New Democratic Party.
What has happened since then? We finally have a Government with the strongest cabinet representation from western Canada in the history of the country. We have a Government that is committed to addressing in turn each and every major grievance that has existed since the Provinces of Alberta and Saskatchewan joined Confederation.
As we bring forward statutes and programs that are absolutely vital and necessary to the diversification and strength of the western economy, time after time we get filibusters and fighting in the House. At the centre of that tactic is the slowing down of public policy initiatives required by the West. At the centre of the strategy designed to thwart and subvert those positive actions, we find the members of the New Democratic Party. They say out of the right sides of their mouths that they care about western Canada and out of the left sides of their mouths and the actions they take in this Chamber that they are dedicated time after time to stopping the progress of the West dead in its tracks.
Every day I sit through petitions and listen to petition after petition after petition coming from NDP riding associations in western Canada. These petitions say that we should get rid of the trade agreement. I would expect that point of view to come from the mouths of the most powerful union leaders in the country who live in central Canada. They like to control the supply while the benefits to their members rise higher. Members from western Canada have become captives of those labour leaders of the powerful unions. To use this House to advance the interests of those people at the expense of western Canadians is unconscionable.
There is not one reputable economist in Canada who does not believe that the trade deal will be good for Canada and for the young people of Canada. The economists go one step further. They tell us consistently that it will be especially good for western Canada.
The Hon. Member has the gall to say that we need value added to the resources of western Canada. To that extent, he is right. We do need value added to the things we produce, but we have to sell them somewhere. To have the jobs, the factories, the plants and the processing, we have to have a market. That market is indeed the entire world, but if we are to serve the entire world on a competitive basis, we need the economies of scale and we need the investments. Someone has to come up with the money to build the processing plants and the factories. Someone has to come up with the money to market the products. To be competitive in the market-place, we need to have access to the markets.
Western Economic Diversification Act
If the Hon. Member had one bit of interest in history, he could study a number of occasions since World War II on which small nations entered into trading arrangements with larger nations and increased their market potential. In each and every single instance, the smaller nation benefited by increased jobs, more satisfying jobs, better paying jobs and increased standards of living for the entire nation. That is what history since World War II has told us and that is what the economists are telling us will happen to Canada and in particular western Canada. Day after day, members of the New Democratic Party fight that vital initiative for western Canada.
Did members of the NDP support FIRA, the Foreign Investment Review Agency, which we changed? They supported FIRA. The Hon. Member smiles with pride and-


Lorne Edmund Nystrom: It wasn't strong enough.


Frederick James (Jim) Hawkes: He says that it was not strong enough. As a consequence of FIRA, Canadian investment left the country and foreign investment stopped coming in. There were well over 1.5 million unemployed Canadians within a very brief period of time.
This Government said that the philosophy of FIRA was wrong and needed to be changed. We wanted an agency called Investment Canada which would encourage Canadians and others to invest in this country. Members of the NDP said that we were wrong and that the Minister of Finance's Budgets were wrong. They said that we would increase the unemployment rolls.
I would like Canadians to recall those early days in the fall of 1984 and the spring of 1985. Members of the NDP said that if we changed FIRA and put in a Budget that encouraged investment, we would produce more unemployed Canadians. That is the logical chain in the belief system of members of the Opposition and particularly members of the New Democratic Party. What happened, though? Canadians are better off today. Over 1,100,000 more jobs have been created, 85 per cent of which are full-time jobs, as a consequence of economic attitudes on the part of Conservative Members that have produced and built upon the individual initiative of individual Canadians.
We believe in a system that challenges individual Canadians to be energetic, to take risks and to succeed. If we do that and if we do it well, it works.
What would NDP Members replace that with? They would replace it with a system of more civil servants, more decisionmakers employed by Government, higher costs to individual taxpayers and less freedom for individuals. Their policies take us consistently in that direction. Surely Canadians have had enough experience with that to know that it leads inevitably to higher unemployment, more tragedy, more wife beating, more suicide and more of all of the social consequences which they profess to wish to avoid.

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Western Economic Diversification Act
Members of the NDP should look back in time just a bit. The two NDP Members opposite were here when the Government increasingly intervened in the lives of people with things like the National Energy Program. They saw the consequences for Canadians and yet they did not seem to learn. It is as if there were a genetic reason right from the beginning that they have to hold on to a belief system, no matter how antiquated or how inefficient it is, simply because they have always believed it. There seems to be an inability to learn from experience.
What are we doing? Canada's patent legislation was out of step. They supported that initiative long before these Members came along. Members on our side said that when you do that, your commitment to research and development will decline, jobs in that field will decline, your standard of living will decline, and your employment rate will decline. They would not listen, they would not learn, and it all came about. Our research and development declined. Young Canadians with skills, talent and energy had to leave the country to find jobs in R and D.
After watching it for 15 years, and watching these things come to pass, this Government brought in initiatives to change that, and all we got was a filibuster. We were delayed in passing that legislation for well over a year. It is a job-creating initiative that will help western Canada, central Canada, and Atlantic Canada but the Opposition fought it.
What have they done on immigration? Each day the social welfare case-load in Canada grows through illegal, unplanned immigration. Each day that happens, money is paid out. Taxpayers have paid out hundreds of millions of dollars. The law we inherited did not allow determinations to be made in any kind of efficient manner. It invited illegal migrant flows, people who by no stretch of the imagination could be classified by anyone as refugees, coming as they did in large numbers from western democratic countries. Yet the Opposition refuses to allow sensible legislation to pass the Chamber.
In 1988 alone the Opposition has spent six days of the House of Commons time filibustering some simple amendments from the Senate. We could have been talking about regional diversity and the western diversification program, topics essential to the well-being of this nation. Instead the Opposition chooses to filibuster refugee legislation for six days.
Then we come to a budget and the need to borrow money. In the six days of budget debate we got very few kudos for reducing the Government's borrowing requirements and saving future generations some of the load. Then we find out that in those six days of debate the Opposition did not learn enough about the need for borrowing, so we got two and a half more days of debate on a borrowing Bill. Close to nine full days were spent on the economy with no useful suggestions. There was just a lot of political posturing while legislation piles up.
Did we get any help on tackling the long-term western Canadian grievance on transportation? The Opposition stalled
two pieces of legislation day after day after day. They would have provided a better sense of equity to western Canadians in the transportation field. Absolutely fundamental changes were required to enable the western economy to grow, develop and diversify, yet what do we get from the NDP? Filibuster. Filibuster. Stall. Filibuster. Filibuster. Why? Do they value the myth of power so highly that any behaviour is justified in the pursuit of that power?
Is there a single piece of evidence in the three and a half years of this Parliament of consistently helpful behaviour by the Opposition? We just get rhetoric. We get rhetoric by the carload. It would be nice if we could weigh the rhetoric to give you some sense of how large it is getting. It would completely dwarf any sense-


Lorne Edmund Nystrom: Point of order, Mr. Speaker. I hate to interrupt a veteran Member, although you would never know he was, but there is a rule of relevance. He should be speaking to what is in the Bill before the House instead of everything else he has been throwing up before us.


Frederick James (Jim) Hawkes: Mr. Speaker, the shoe must be pinching just a little because so much truth is being laid on the table.
The Hon. Member referred to tourism. Western diversification relates to tourism. Is there any credit for the very early decision taken by this Government to spend several million dollars in a new advertising campaign consisting of television and radio commercials?


Nelson Andrew Riis: Pittance.


Frederick James (Jim) Hawkes: The Hon. Member says it is a pittance.


Nelson Andrew Riis: You bet it is.


Frederick James (Jim) Hawkes: If tourism is up in western Canada by 35 per cent or 40 per cent, how many jobs for real people who need a real income does that represent? Yet the Member shouts "pittance". Governments he supported for so many years did not spend that pittance. They did not create those jobs. This Government did.
What did they do on energy? They invented a grand scheme involving PIP grants to the oil industry. Now we see the court cases involving abuses of those grants. We rang the bells for 17 days in this Chamber and then we had a committee process.


Nelson Andrew Riis: Are you proud of that?


Frederick James (Jim) Hawkes: I was there every hour of every day telling government Members the consequences of that program, how many lives would be ruined as a consequence. I told them what would happen to the economy. This would increase suicides, spouse and child battering. Yet I did not see the NDP, sitting alongside me in those committee meetings, fighting for the people of western Canada. I do not see them in this Chamber today fighting for the people of western Canada. I expect what we will see through the balance of this day, into tomorrow and the next day this is debated, is NDP Members from western
March 2, 1988

Canada filibustering the western diversification fund. How in God's name they can translate that kind of tactic into something useful for western Canadians is beyond my wildest imagination.
Statutory legislative authority to produce a mechanism and fund unbounded by central Canadian dictates but open to the flavour of the West, the creativity of the West, is what we are creating in this legislation. Our part of Canada is as unique as Quebec. It is as unique as Newfoundland. That is part of the charm of Canada. This Government believes that unique programs and practices are required in the different regions. As western Canadians, some born in western Canada, they should know that reality and be supportive of our efforts to achieve that result.
Let us watch what the NDP does. Do they facilitate or block an initiative designed to help western Canadians?


Nelson Andrew Riis: Mr. Speaker, I listened with interest to my hon. friend. My recollection is that we have been debating this Bill for about three or four hours and he is already calling it a filibuster. I realize that this is one of the Members who stormed the Chair of the House of Commons. He broke all parliamentary tradition by shutting down the House of Commons, standing before the Speaker, shaking his fist and screaming. They held this House to ransom day after day after day. Some of us were sickened at that behaviour. Presumably the Hon. Member is proud of the fact that he was prepared to strangle the voice of this House, throttle debate, and essentially close this House and Parliament down.
I was not pleased with that. I was not proud of that. I was embarrassed by the fact that the Hon. Member and his colleagues decided that was an appropriate tactic. That is dictatorial. It is something we would find in a fascist system and certainly has no place in a parliamentary democracy.
Having said that, my hon. colleague from Yorkton- Melville indicated that sourcing of supplies and services is one way the federal Government can assist the local manufacturing economy, particularly that in western Canada. Yet the statistics are very clear that government sourcing in western Canada has decreased over the last four years. There is less government sourcing in western Canada on a percentage basis than ever before. Eighty per cent of federal government sourcing continues to be from isolated portions of central Canada.
How does the Member explain the Government's interest in western Canada if it is sourcing less of its goods and services from the West, on a percentage basis, than ever before? Second, does he really believe that after three or four hours of debate on a very important issue with regard to the diversification of the western Canadian economy we have debated for too long, that the debate should stop, and that anything further would be considered a filibuster?
Western Economic Diversification Act


Frederick James (Jim) Hawkes: Mr. Speaker, every time opposition Members open their mouths they give us lots of things to say. One of the tragedies of this Chamber is the lack of thorough research in the Opposition. I particularly resent a person of the Member's stature within his Party saying that I stormed the Chair. I never did. I never have. I care deeply about the Constitution of Canada and I participated actively in the committee hearings from morning until midnight. I cared about it in the Chamber and I stood in my place and participated in the filibuster, which was the longest in parliamentary history, because it was a fundamental issue to the people of this country, but I did not storm the Chair. I did not break the rules. I think the Member's research should be better founded in this case and in many others.


Nelson Andrew Riis: Mr. Speaker, I rise on a point of order. I did imply that the Hon. Member was one of the group which stormed the Speaker's chair. I simply assumed that due to his enthusiastic support of that initiative he would have been a member of that group. However, if he was not part of the group that stormed the Chair and closed down Parliament for a number of days, I will retract that and apologize to my hon. friend. I would not like to link him with the group which carried out that particular act.


Frederick James (Jim) Hawkes: Mr. Speaker, I appreciate that comment. I participated in two filibusters in this Chamber. One was the ringing of the bells and the consequences of that which was related to the energy Bills.
In terms of the Constitution, I believed that my part of the country would be forced to leave Canada if the original version of that had passed. It would have shoved me out of my own country. I worked with Members of the Opposition, including the one who spoke before me, to ensure that the original version did not pass and we succeeded. We can stay in Canada with pride.
Second, I participated in the filibuster on the energy Bills because they were going to devastate western Canada, my city in particular, and to some extent the entire country. They were wrong-headed and wrongly drafted. We did not succeed, and that is a tragedy. I look at the anguish in my community day after day and wish I had somehow been able to avoid it.
Those are two fundamental issues and it is the responsibility of people in this Chamber to filibuster, to fight, and to use all the tools available on fundamental issues. However, it is a travesty that the reality of this place is that pieces of legislation are filibustered which deserve to be passed through the House into committee for detailed study and to be reported back. To plug up the legislative agenda on things like copyright, immigration, and western diversification is not the proper use of this Chamber or of taxpayers' funds. This place was not invented for that purpose.
In Britain, the mother of Parliaments, most legislation is debated in the House for less than a day. It is very rare that it takes more than a day. Yet in this Chamber we are exposed to

March 2, 1988
Western Economic Diversification Act
blocking tactics. If the Opposition wants to block positive initiatives such as western diversification, let us take it to the voters. Let us lay out the record of blockage on initiatives that are helpful to western Canadians.


Nelson Andrew Riis: Call an election tomorrow.


Frederick James (Jim) Hawkes: Let us go to an election and explain to western Canadians what we have done with regard to reorienting the system of government to give all regions of the country a say in decision making. Let us take to the voters a piece of legislation such as this which so clearly says that western culture will be attended to and decisions will be made in western Canada. The program is flexible to encompass the aspirations of people who live in that region. Let us go to the voters and tell them that the NDP will say one thing but will do another.


Lorne Edmund Nystrom: Mr. Speaker, it seems to me that the Member from Calgary is living in dreamland. He is talking about filibusters and so on. I have been here for many years and have seen his Party in opposition. If there was a Party that was expert at filibustering and delaying, it was the Conservative Party in opposition. One need only think of people like Erik Nielsen to think of filibusters, delaying tactics, and stalling tactics.
I find it very surprising that someone who is supposed to be an honourable Member questions the motives of Members across the way. He said that I do not speak up for western Canada, that I do not represent western Canada but rather union leaders in central Canada. That is nothing more or less than regional racism. It is regional racism of the worst kind. It is the kind of game which divides Canadians and is very divisive of the future unity of the country.
I do not question his western credentials. Of course he speaks up for western Canada. He has a different point of view than have I, but that does not make him less a westerner than am I. Why should I be less of a westerner or less of a Canadian than he is? That is the kind of nasty regional racism which divides the country. I am very surprised to hear someone from across the way with his experience say that kind of thing.
I voted against the Government in December, 1979, on a non-confidence motion because I thought the Budget was bad.
I did not defeat Joe Clark, the people of Canada defeated Joe Clark. A majority government was elected. The New Democratic Party caucus grew in size. The Conservatives lost western seats. In Saskatchewan, for example, the NDP went from five Members to seven and the Conservatives went from nine to seven. The people spoke.
That kind of arrogance and playing on divisiveness and racism turns people off of politicians. I just hope the Member across the way would not do that kind of thing. He says that because someone from western Canada speaks out against the trade deal, they are not a westerner. All he need do is look at the polls in western Canada. There are a lot of Manitobans, Albertans, people from Saskatchewan, and British Columbians who oppose this trade deal. In fact, until recently his Party
opposed this kind of a free trade deal with the United States. Year in and year out the Conservative Party led the crusade against such a trade deal with the United States.
Polls indicate that in Saskatchewan opinion is divided fifty-fifty, as the Member for Assiniboia (Mr. Gustafson) knows. There was a rally in Regina recently, attended by a couple of thousand people who are opposed to this trade deal. There are all kinds of farmers in my riding who oppose this trade deal. They are concerned about the future of agriculture. That does not mean that they are not westerners or do not speak up for western Canada.
I just wish that we could have debates in this House in which we did not have to resort to this kind of divisiveness and name-calling but could talk about the issue on a substantive basis. That is what great leaders of the Conservative Party used to do. I think of the Member for Yellowhead (Mr. Clark), a former Prime Minister, Mr. Stanfield, and others. Most people in that Party still debate issues on their substantive merits, but when we start using regional name-calling it degrades this place and creates an atmosphere in the country which is very disunifying.


Frederick James (Jim) Hawkes: Mr. Speaker, maybe we are moving toward debates which centre on the issues. However, I sat here before I made my remarks and I did not hear much debate about the western diversification fund. I would like to leave the Member with a couple of pieces of information.
Deputy Minister-level meetings are occurring this very day between western diversification and Supply and Services to try to articulate the programs. Meetings at lower bureaucratic levels go on on a daily basis. They are trying to help western Canadian citizens access government programs and services in better ways than they used to. The Deputy Minister of Supply and Services and the Deputy Minister of Western Development met with all their provincial counterparts as recently as two weeks ago. This is the western way. Western Canada is composed of communities with pioneer roots. We have a volunteer tradition which all Canadians saw during the Olympics. We are used to working together.
I hope that the New Democratic Party would at least support this and we could use the extra 39 minutes to get this legislation into committee where it can be well vetted, returned for report stage and third reading, to become the law of the land in the near future.


Nelson Andrew Riis: Mr. Speaker, I am thrilled to rise to speak to Bill C-113, an Act to establish the western diversification office and subsequent offices in western Canada, and to lay out the framework to disburse funds in western Canada. This Bill represents an effort in terms of decentralization of decision-making and toward the diversification of the western economy. For those two reasons,
I certainly support the principle of this initiative.
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I want to emphasize that the principles of this legislation are appropriate and honourable, ones that 1 and others have advocated for many years. There has been a need to diversify the economy of western Canada and move its dependency away from the resource industries, as valuable and important as they will always be, and to recognize the reality that the jobs of the future will move more toward these service sector industries, small scale manufacturing and a knowledge based economy.
While we ought to continue to develop the resources of western Canada as we have for many years, we should make greater efforts to finish more of those resources in western Canada and attempt to process these raw materials in western Canada. That is the challenge we face when it comes to developing our resources in western Canada so that we can move away from the extraction, development and growth of resources for overseas export which links us too closely to the vagaries of the international market. Our dependence on the resource sector gives us the traditional boom and bust economy of the West and ties us into the cyclical pricing of commodities on international markets. While that brings very good times, as we have seen recently, it also causes very tough times for westerners.
We certainly agree with the principles behind this Bill, but we have some real concerns about it as well. There is a feeling in western Canada that the federal Government has turned against westerners to a certain extent. While I am not sure people feel betrayed, they are certainly surprised that more has not happened in western Canada considering the overwhelming number of westerners in the Cabinet, from the Deputy Prime Minister (Mr. Mazankowski) to a number of other senior cabinet Ministers. It seems that there has not been the resurgence and support of the western economy that people had expected.
I need go no further than my constituency and surrounding constituencies in western Canada, including the Caribou constituencies, northern B.C. constituencies, the Kootenays and Okanagan Valley constituencies.
I do not believe that many people in those constituencies would agree that their lives have been better or more secure than they were in 1984 when this Government was elected. In fact, those to whom I have spoken have indicated that they do not have the same feeling of confidence for the future, particularly for their children and grandchildren.
For example, one can consider the re-emergence of the Western Canada Concept and the Confederation of Regions Party. These parties are gaining strength in western Canada, primarily from the right of the political spectrum, which normally include disillusioned Conservatives who believe that the West has not benefited as much as it should have, considering the overwhelming number of western Conservatives in the Government.
Western Economic Diversification Act
What is the reason for this disillusionment? Let us consider Bill C-113. It provides $1.2 billion over five years for all of western Canada, comprising four provinces. Goodness knows that the Liberals certainly abandoned any support for the West when they were in power, but they introduced the Western Development Fund of $4 billion over four years. The Conservatives are introducing a significantly smaller amount of money through this program we are debating, which seems to suggest that compared to the Liberals, matters seems to be worse in terms of western Canada.
We can study this further by examining federal Government sourcing through agencies, which has a tremendous impact on the regional economy. If federal Government Crown corporations like Petro-Canada, Air Canada, CNR and others were to purchase much of their goods and services from western Canadian suppliers, it would give a real boost to the economy in western Canada. Elowever, let me quote from Supply and Services statistics. In 1981 western Canada received about 15 per cent of all the money invested in supply and services by the federal Government. In 1984, that decreased to 14 per cent, and by 1987 had decreased to 11 per cent. In other words, the amount of sourcing from western Canada relative to the rest of Canada is less than it had been when the federal Government took office. One can only assume that the Supply and Services figures are accurate.
Let us consider the Industrial Regional Development Program and the value of contracts given across Canada, noting the population in western Canada. Once again, we received less than our fair share based on the population of western Canada relative to central Canada.
If one wanted to make a case for an affirmative economic program for western Canada, perhaps one could even argue that western Canada should get even more than it deserves considering the high levels of unemployment in western Canada compared to central Canada. Presumably this is another indication of why people are disenchanted with what is happening in terms of economic development in western Canada.
Let us consider regional development programs which are primarily meant to assist regions like those in western Canada. In 1984, the federal Government was spending $14.8 billion on regional development programs. As our Estimates would indicate, in 1987 regional development programs amounted to only $11.8 billion. In other words, $3 billion over a three-year period was plucked out of regional development programs which, by and large, go into helping areas like western Canada. I am wearing a button today which says: "Go with the flow". This button represents our concern regarding the Government's decision to cut back on flow-through shares to assist the mining industry. We all know that the flow-through share program provided a tremendous incentive, encouragement and nurturing of the exploration programs that eventually led to mining property development and, hopefully, mines.

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Western Economic Diversification Act
Everywhere in Canada from the western Arctic, to British Columbia, up to the Yukon, right across northern Canada to Labrador, a tremendous amount of mineral exploration is taking place because of this particular initiative, the flowthrough share program. The Government's response to this is to essentially gut the flow-through share program. This is the kind of thing that makes us wonder how committed the Government is to western economic development programs.
I do not have to remind Members of the maintenance contract for the CF-18. Virtually every single adviser suggested that the maintenance program should go to the West. However, the Government decided it should not go to the West. If we are going to make decisions based on politics, let us be up front about it. We were going to make the decision based on economics or the professional advice we received, but when 75 advisers out of 75 said the contract should go to the West, the Government ignored that advice. As a westerner, I can only assume that the Government's priorities appear not to be the development and support of the economy of western Canada.
I can also talk about the CN cuts. I notice the Minister of Transport (Mr. Crosbie) is in the House of Commons. He will know that over the last number of years, unfortunately, we have seen a number of positions cut in CN. Because the lion's share of rail activity takes place in the transportation infrastructure of western Canada, once again it is western Canada that is essentially the hardest hit in terms of those cut-backs initiated throughout the rail system.
There is also Challenge '88. That is the program where the Government helps to fund college, vocational, technical and university students for the summer. We all recognize that inflation year after year requires that these programs be increased marginally to keep up with the rate of inflation. However, during the past two years the allotments of the federal Government for the summer work program for students have not increased at all, which means, when one factors in inflation, that there have actually been serious cuts to the amount of money the federal Government provides for summer jobs. Of course, the problem is most acute in western and eastern Canada. In pockets of central Canada we have a tremendous amount of economic prosperity and the chances for a summer job are much greater than in areas of western Canada where unemployment rates are now in the 20 per cent to 30 per cent range, which makes it very difficult, if not impossible, for young people to find employment.
I do not think anyone would question the fact that if we are going to have economic prosperity in western Canada, we have to invest more in the most important natural resource of western Canada. When I refer to the most important natural resource, I do not mean wheat, timber, coal, gas, oil or minerals. 1 mean people. When we invest in developing the most important natural resource in western Canada, the people, it means we have to spend more money on education
and training programs. However, when we look at the amount of money allocated for training over the last number of years, we find the Government has not increased but has cut funding for those programs.
Last year, the Estimates indicate that $479 million existed for employment programs. This year it will be $339 million. That is a $140 million cut in the amount of money going for training and education. All of us who have universities and colleges in our areas realize that Employment Canada has been forced to cut the number of seats it normally would fund to assist people to train and upgrade and improve their skills. In that critical area, the development of human resources, there seems to be cut-backs.
I suppose what has most obviously affected western Canada has been the decision of the Government to cut back in funding for the Post Office. It requires that the Post Office make money. It is one government service the Government decided should make profits. We do not expect the military to make profits. We do not expect the RCMP, ambulance services, universities and colleges or hospitals to make profits. We do not expect the Department of Immigration to make a profit. However, we do expect the Post Office to make a profit, that one government service that touches the lives of every single Canadian in every Canadian community for their entire life. In a country as vast as Canada, where we are trying to service rural areas and small communities, we have to cut back on the amount of service we provide.
Where do we cut back if we are trying to make an efficient profit-making organization of the Post Office? We do not cut back in Montreal or Toronto. We cut back in the rural areas, the post offices in the small communities. Where do they exist? They exist in western Canada. That is the part of Canada where rural areas and small communities are being depopulated at an ever accelerating rate. There seems to be a lack of commitment by the Government in terms of maintaining a dignified rural life in western Canada because we are seeing the erosion of government services, the most obvious being postal services.
What we see in this legislation is a bit of an illusion. It gives the impression that the Government is interested in the economy of western Canada and the diversification of the economy of western Canada, but I think if it really was it would not have excluded, for example, the ability of communities to redevelop their urban structures and to expand their community development.
For some mysterious reason the Government has decided that the western diversification fund will not be used for urban or community development. In other words, it will not be used to improve sewage treatment or water systems, to build roads or to provide community facilities. If we are going to diversify the economy of western Canada, it is imperative that those communities be vibrant communities. If we are going to encourage the development of service industries, high-tech industries and modern manufacturing, we must have good
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universities, colleges, technical schools and vocational schools. If the basic urban infrastructure is not there, it is going to be more difficult than ever to expand those particular facilities.
I want to remind you, Mr. Speaker, that every provincial Government across Canada, barring none, has said they are prepared to participate in a municipal infrastructure sharing program. They say they will pay one-third, the local taxpayers in the area will pay one-third and the federal Government kicks in one-third. In other words, there will be a one-third cost sharing program to develop urban infrastructure. The provinces, cities and municipalities across Canada unanimously agreed. Only one person did not. That was the federal Minister of Finance (Mr. Wilson). He said he was not interested in participating in the development of rural infrastructures using this method.
1 could go on and talk about the need to expand Government procurement and the need for programs to encourage the development of our tourist industry, small business and manufacturing in western Canada, and programs to assist in the development of value added for our resource industries, but I think what is needed more than ever is a development strategy. The western diversification fund is really a grab bag. For example, British Columbia, $79 million over five years will be used for South Moresby Park. That money should have more rightfully come from the social policy reserve fund or the Parks Canada fund, not from the western diversification fund. The $53 million in British Columbia to be spent over five years for salmon enhancement should come from the Department of Fisheries, not from the western diversification fund.
There was the $10 million bail out for the Fraser Valley Shakes and Shingles Association after the devastating decision by the Government regarding shakes and shingles exports. We are already seeing a major part of the fund eaten up with programs that should be rightfully funded from other government departments. We do not have a comprehensive strategy in terms of developing proper facilities for our urban communities.
We have not developed proper over-all strategies in terms of western transportation and communication, the development of our river systems and soil preservation policies in the West. What is the strategy, what is the business or economic blueprint we are trying to introduce into western Canada? As I see it at the moment, it seems to be simply a grab bag. Whatever one can convince the decision makers of will be funded or there will be a grant or loan guarantee or whatever.
O)
In closing, I say that we agree in principle that this type of approach is necessary. However, in terms of a real commitment that is honest and real to diversify the economy of western Canada, it does not seem to be here in this particular legislation.
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Mr. Deputy Speaker:: Are there questions or comments? The Chair recognizes the Hon. Member for Nanaimo-Alberni (Mr. Schellenberg).


Mr. Schellenberg:: Mr. Speaker, I have a comment and a question. I listened with interest to the discourse of my hon. colleague from British Columbia. I must admit that I was somewhat confused when he asked the rhetorical question that he said he asked his constituents. The question was, "Are you better off now in 1988 than you were in 1984?" He told us that his constituents responded in the negative. When I ask that question in my riding, the response is positive.
My constituents acknowledge that the federal Government has spent more in reforestation money than any other federal Government. They state that housing starts are at a new high in Canada. They state that it is now cheaper to borrow money than it ever was before. They remind me that the unemployment rate on central Vancouver Island was 17 per cent when I was elected and that it is now some 10 per cent. This means that 90 per cent of my constituents are working.
It seems to me that the people of Nanaimo-Alberni see the glass as being half full while NDP riding associations and NDP Members see it as being half empty. This probably comes from having a pro-active Member of Parliament, a positive Member of Parliament, as opposed to having a reactive and negative Member of Parliament.
The Hon. Member attacked the Government's position on flow-through shares. He stated that he is wearing a button which states, "Go with the flow". I cannot understand how the NDP can justify attacking big business and big corporations for not paying enough tax and yet support just such a tax measure which would employ people. They cannot have it both ways. Can my colleague respond to that?


Nelson Andrew Riis: Mr. Speaker, I appreciate the chance to respond to my hon. friend. With respect to the flow-through share issue it benefits primarily companies that are not in a profit situation. That is the idea of a flow through. The flow through goes to an investor beyond the actual exploration company involved.
I am pleased to say that the flow-through share program benefits not quite exclusively but largely Canadian junior companies, Canadian owned companies. It is a good program. It has generated a tremendous amount of mining activity across Canada. That is why I think it should be preserved. That is why perhaps even tomorrow, which is an opposition day, we might take some initiative to ensure that the debate on the flow-through share issue is continued.
With respect to my friend's original comment, perhaps it would be useful for him to discuss the situation with his Kootenay colleagues. Two of his friends, Conservative Members of Parliament, represent Kootenay ridings where the unemployment rate is now about 20 per cent. My recollection is that back in 1984 it was also about 20 per cent. For that part of British Columbia things have not changed significantly.

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Western Economic Diversification Act
I suggest that he also spend some time with his Conservative colleague from the Cariboo region of British Columbia. In that region the unemployment rates have not changed substantially since 1984.
To say that every initiative that the Government has taken is bad would be inappropriate. There is more funding going into reforestation in British Columbia than there was under the Liberals by some margin. However, I like to think that if we were serious about regional economic development, and I suspect that my hon. friend will agree, that while there have been more advances and more efforts made in terms of husbanding our forest resource much more could be done.
I want to share with the Hon. Member what took place at a meeting I had recently with a number of professional foresters in my constituency. They were asked how many men and women could actually be employed to develop the forest resource as it ought to be developed in central British Columbia, particularly in the Kamloops reforestation district. They said in terms of thinning, spacing, fertilizing, disease control, pest control, road building and a whole variety of other programs that as many as 10,000 men and women could be employed over a vast number of years. That is what we should be doing if we are going to develop our resource, as is done in places such as Finland, for example. I suspect that the Hon. Member would agree that that would be an appropriate initiative to take.
Rather than providing funds for unemployment insurance or indirectly through welfare, why not develop programs with our forest companies, in co-operation with our provincial Governments, to develop and to husband that critical forest resource, not only in western Canada but right across Canada? This would put literally tens of thousands of Canadians to work at something that must be done. It would not be a make work program. It is something that must be done in order to develop a critical Canadian resource.


Mr. Gottselig:: Mr. Speaker, in sitting here this afternoon listening to the debate I am having a little difficulty with it because I am a new Member of the House. I have only been here since 1984. I can only reflect on how things were then and how things are now in my own riding.
My background is in small business. I am a farmer. People who have sat here for the length of time that some of the Members in the New Democratic Party have sat here have been out of touch with reality for a little too long. They review how things were then and how they are now.
The fact is that interest rates have made a fantastic difference to agriculture and to small business. Just look at the unemployment rate and the way it is now. I lived through those years. 1 was in business and in agriculture. It was very difficult to survive in those years, thanks to the way things were. Interest rates were at an all-time high. I do not have to tell anyone who is in small business or in agriculture about this. They have only to look back at their records for 1981 and
1982 to see that they were paying interest rates of 22.5 per cent and 22.75 per cent and higher. I have but to remind them who was in government then. It was the Liberals who were in power as a result of the New Democratic Party defeating the Conservative Government.
We have brought in legislation. It was first announced on August 4, 1987, by the Right Hon. Prime Minister (Mr. Mulroney). This legislation is to promote diversification of the economy in western Canada.
I would like to share with the Hon. Member something that I read in the Moose Jaw paper. It is from the January 30, 1988, edition. The article states that a Moose Jaw company has gone high tech thanks to assistance from the western diversification fund. Is this fund not working? What would the Hon. Member call that then? Other firms in Moose Jaw are also receiving assistance from the western diversification initiative.
Why do we not pass this legislation? What is the big debate about? Do Members of the New Democratic Party intend to stand here speaker after speaker and lament their past and all the sins they have committed in the past with the Liberals? Let us bring this matter to a vote.


Nelson Andrew Riis: Mr. Speaker, I hope that no one here would say that the $1.2 billion as spread out over five years will not do any good for anybody. No one is saying that. I think that is what the Hon. Member is implying.
In response to the Hon. Member's point that some people are out of touch with reality, I would point out to him that there was an NDP nomination meeting in his constituency on February 20. In 1984 there were 200 people at the NDP nomination meeting.


William (Bill) Gottselig: In 1984 there were 1,500 people at the PC nomination meeting.


Nelson Andrew Riis: On February 20 there were 700 people at the nomination meeting. The number went from 200 to 700. I think there is a new wind blowing down there in Moose Jaw. If the Hon. Member wants to do the right thing, he should probably spend a lot more time back home rather than standing here in the House of Commons making nonsensical comments.


Mr. Maurice Foster (Algoma):: Mr. Speaker, I am glad to have an opportunity to say a few words on Bill C-113. It has been interesting to listen to Hon. Members across the way participate in the debate. They are telling us how great it is today with the Tories in power and with all the initiatives that are being taken under the Western Economic Diversification Program. Clearly, it would be desirable to see how much the program will do for western Canada.
It is easy to see how the Government is able to gussy up the $220 million per year to run the program if we simply look at


March 2, 1988

the tremendous cut-backs that have been made over the last three and a half years by the federal Government. If one looks at that, combined with the massive increase in personal taxation, it is not difficult to see where the Government will come up with the extra money to fund this program which, let's face it, is a very modest program. It is interesting to note that all of those programs are calculated over a five-year period.
During 1983-84 the previous Liberal Government committed some $1.2 billion to western Canada in a two-year period under the ERDA program. That amount was increased to $2.1 billion because it provided for matching funds from the provinces. The amount of money that we are looking at is not very great when one considers the type of cut-backs that have taken place.
A few days ago the Minister of Transport (Mr. Crosbie) announced approximately $25 million worth of branch line rehabilitation projects. Of course, they came out with a nice blue label giving the Minister's name on each sheet and stating that they were jointly announced by people like the Parliamentary Secretary to the Prime Minister (Mr. Gustafson), wherein he announced that he was going to carry out the rehabilitation of a line in his constituency amounting to several hundred thousand dollars. In fact, there was one for $165,000.
What the Minister of Transport did not announce in this program is that, by the end of the period, 1990, when the more than $1 billion program will be complete, $125 million will be left in the program unspent. A program that is desperately needed for rehabilitation and upgrading of the rail lines throughout western Canada in order to move grain and wheat to market will have money left unspent and will lapse. I assume that it will never be used.
For instance, the Wood Mountain subdivision was supposed to be rehabilitated. In these announcements, 1 do not see any indication that that subdivision will be rehabilitated. 1 understand that the Parliamentary Secretary to the Prime Minister, the person who wears the flak jacket and harangues the troops and tells them about how bad the NDP defence policy is, has had many representations. He has attended meetings. Still, the money will not come.
It is clear that the Minister of Transport is siphoning off approximately $125 million from the rail line rehabilitation program in western Canada that was supposed to be spent on rehabilitating those rail lines in order that crops could be moved to market more rapidly. I suppose it is being shifted over into the department of western economic diversification. In fact, it is a type of shell game. There is $1 billion here, but we are not going to spend $125 million of that, so we will create another department over here. In fact, approximately one-third of the funding for the first year will likely come out of that fund.
An Hon. Member asked how things were three or four years ago, and how they are now. Three or four years ago the price of grain in western Canada was $170 a tonne for No. 1 wheat.
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A few years prior to that time, it was close to $200. This year it is $110. Barley and oats are much lower than that.
How far does a $220 million per year program go in covering that type of reduction in income for grain farmers? In fact, it is totally irrelevant. The devastation which has been wreaked on western communities, entire community life, and the stress on individuals, has not been seen since R. B. Bennett was in power during those terrible years from 1930 to 1935.
How have the Tories responded to this situation? If we look at the debt situation, the signals were clear and unmistakable in the fall of 1984 when the Farm Credit Corporation signalled that we were facing one of the worst farm debt crises since the 1930s. Very little, if anything, with regard to the farm debt crisis happened for the first year or so.
In the spring of 1985 the Minister finally got around to bringing in the farm debt review boards. Those boards do not have any power to reschedule debt or refinance farmers' loans. They are very modest programs. Some people suggest that all they do is silence everybody in sight, from the people on the board to the farmer, to the advisers, to the local pool operators, to everybody involved.
When the Government finally moved on some debt restructuring programs, it brought in the commodity based mortgage which was designed to help a couple of thousand farmers per year for the last two or three years.
We are faced with the situation in Saskatchewan and other parts of the Prairies where there are some 50,000 farmers in serious financial difficulty, some 12,000 of whom are totally insolvent. The Farm Credit Corporation started appealing a year ago last fall for funds to revitalize a recovery program for the Farm Credit Corporation. No action has yet been taken.
The Minister surreptitiously filed the Farm Credit Corporation's report on the last day the House sat last June. It showed that the Farm Credit Corporation was insolvent to the tune of $124 million. It is expected that that will be more than $300 million for the current fiscal year. How can this corporation help farmers in serious financial difficulty to reschedule debt, set aside debt, or overcome these difficulties when it is insolvent?
The magnitude and the gravity of the situation in western Canada has gone down every year since, and no effective action has been taken with regard to the farm debt crisis. I guess the double whammy of the whole situation is the Western Accord which the former Minister of Energy, Mines and Resources negotiated with the prairie Tory Premiers. It was hailed as a great step forward. Everybody believed that until the spring of 1986 when the world price of oil collapsed. The price dropped from $28 a barrel to $10, recovering to $18 a barrel last summer. Oil is now around $16 a barrel. If it was so good, why did this great negotiation not take into account the precipitous drops in the price of oil that we have seen, as well as the recession and depression that fell on Alberta and Saskatchewan during that period?

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It is common for the Tories to talk about how tough things were in the recession years of 1981-82. But they were not nearly as bad as in the summer of 1986 and early 1987 and which is continuing, when oil prices were at the $15 or $16 a barrel level. The situation has been made worse with the appreciation of the Canadian dollar, creating the double whammy. The cut-backs and the pounding down of western community life continues. Its very vitality is being removed, and I do not see how a couple of hundred million dollars, or $220 million a year, can really diversify the entire western economy.
In northern Ontario, Atlantic Canada and other resource areas the Government has hit us with several double whammies in support for community colleges. There has been a cutback in funding by 40 per cent. The number of seats in community colleges has been reduced by 40 per cent right across the country. The oil industry in Alberta and the grain industry right across the Prairies has been suffering hardship. When people want to retrain, the seats are not available because of the 40 per cent cut-back.
Likewise, the Government is hell-bent on a program in rural Canada to remove and privatize post offices, replacing home delivery with superboxes. Many communities already feeling the pinch and suffering from a reduction in population are having their post office removed, resulting in one less job. Across the country 9,200 jobs will be lost, 80 per cent of which are held by women. Over 5,000 post offices will be affected.
Interestingly enough, the resource areas have benefited tremendously from the earned depletion allowance for the mineral industry. Signals went out last spring that it was to be cut. Yesterday at the Renaissance Hotel in Ottawa there was a conference to encourage the protesting of the Government's decision to cut out the earned depletion allowance. This has been providing some $400 million to $500 million for mining exploration and development, especially in western Canada, northern Ontario, northern Quebec and other resource areas.
The program should be reinstated. It has been providing $400 million to $500 million. That money is important because it creates activity in diamond drilling, exploration and development. Diversifying the economy in a mineral area is extremely difficult. The flow-through share mechanism with an earned depletion allowance of 33 per cent is extremely difficult to replace with any other mechanism. Not only are exploration and development dollars spent by diamond drilling teams and so on, but mines are established.
A number of mines in northern Ontario are being brought into production because of the earned depletion allowance provided by the Government. Clearly, every Member in the government caucus, including Members from Timmins, Abitibi, Quebec and Timiskaming in Ontario who have spoken out, will have a chance on Monday evening-the motion will be put on Friday-to vote for or against the replacement of the
earned depletion allowance which affects not only northern Canada but western Canada as well.
Another action taken by the Government relates to the decision on the softwood lumber deal with the United States. The full effect of this deal, which is costing the resource producing areas of Canada, including British Columbia, some $500 million a year will not be felt until the downturn occurs both in the Canadian market and in the United States.
I read a report a couple of weeks ago by a lumber company in Prince George, British Columbia. Under the previous arrangement, the company was paying $600 million a year in stumpage charges. But under the deal negotiated with the B.C. Government, the federal Government and the United States, this company will now be paying $19 million a year in stumpage charges. The company said that when the market turns down it will be out of business.
There is a concerted attack on rural resource areas and in all areas of activity in the West. Whether we see a dramatic downturn in grain prices, the farm debt crisis or the deal negotiated on oil, clearly all these attacks on the western economy will not be overcome by a program which provides a couple of hundred million dollars a year in a diversification fund.
There is a diversification program in northern Ontario. Although it was signalled in the fall of 1986 and announced last summer, there are no application forms or criteria yet available. I understand much the same situation exists in western Canada. A program is announced, money is announced but the actual criteria for projects are not available. The actual application forms are not available. The implementation is simply not there. Rural infrastructure which is desperately needed by many rural communities is excluded from the program. We have to ask ourselves, in the face of the tremendous onslaught that has taken place, is it really too little too late to help western Canada with all the problems it faces in economic development and diversification?


Mr. Gustafson:: Mr. Speaker, I would like to make a brief comment on the some of the statements that were made about western Canada. The debate that has been going on boils down to assessing what has and has not been done by various Governments. Certainly the Hon. Member who just spoke, who himself was a part of the National Energy Program committee, knows what that devastating legislation put in by the Liberal Government did to western Canada.
Let us look at the record of our Government over the past three years. The farmers of western Canada and particularly those of the area I represent have never been treated better in difficult times. We went through a drought and difficult prices in the international market-place. Just yesterday, the farmers of western Canada received the first payment on the grains payment.
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Comparing what the Liberal administration did in western Canada during good times and what our Government has done in a short term, 1 can tell Hon. Members that the farmers in general are very supportive of this Government. There will be people from the other two Parties who will vote for our Government in the next election based on the performance of this Government.
The Hon. Member mentioned the rail lines. I would like to make a statement about the rail lines in my riding. I am very pleased that the Hon. Minister of Transport (Mr. Crosbie) is in the House to hear this. A great deal of the credit goes to him for what has been accomplished.
The Hon. Member for Regina West (Mr. Benjamin) attended the meeting in Minton a week ago Saturday when we went to bat for the problem that exists there, and I thank him for his help. I especially want to thank the Minister for the quick action he took on including money to be spent on rail line improvements for the completion of the Bromhead-Minton line and the Fife Lake line.
1 do not know where the Hon. Member is getting his information from. I am the first to admit that there is still more work to be done. We do want to see the completion of the Bengough line, and I am sure we will. The Hon. Member is trying to leave the impression that action has not been taken in western Canada on the rail lines and on the welfare of farmers. That absolutely misrepresents the situation and I just wanted to clarify that.


Maurice Brydon Foster: Mr. Speaker, it was very interesting to listen to the Parliamentary Secretary to the Prime Minister and to note the apple polishing he is doing for the benefit of the Minister of Transport. I assume he is doing that because he is having difficulty getting the Minister to do improvements on the Wood Mountain subdivision of the railway. Clearly it does not appear that any decision has been made on that by the Minister. 1 suppose that would explain why the Hon. Member is doing so much apple polishing.
1 think it is up to the Parliamentary Secretary, who obviously has tremendous clout in the Tory caucus, to put the hammer down on the Minister of Transport so that he does not leave $125 million in the rail line rehabilitation program pot. That is exactly what is going on. I do not know how the Hon. Parliamentary Secretary will be able to say to the people of these various communities: "Well, we tried, but the Minister had already nixed the balance of the program".
In the way the program has been delivered, there does not seem to be any money for the Wood Mountain subdivision. The Parliamentary Secretary attended the meeting and promised that there would be action. He went to the Minister but got no action. The only alternative he has is to go directly to the Prime Minister (Mr. Mulroney).
I know the Parliamentary Secretary has the ear of the Prime Minister. He is briefed with the Prime Minister every morning on all the national issues of the day. I would hope that he
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would put pressure on the Prime Minister to get the Minister of Transport to ensure that the other rail lines get completed.
I wonder how the Parliamentary Secretary could be so happy about telling us that he has done all these wonderful things for agriculture while there is still a very large number of farmers facing total insolvency and serious financial difficulties. The Government brought in a very minor program, the commodity-based mortgage program, which provides for about 2,000 mortgages at around 8 per cent across the entire country over two years.
The magnitude of the problem we face today is unprecedented since the 1930s. There are 50,000 farmers in serious financial difficulty. The Government brought in a program a couple of years ago that provides benefits for a couple of thousand farmers. These benefits are only available to people who have mortgages under the Farm Credit Corporation. If a farmer has a mortgage with the Royal Bank or the Bank of Commerce and is hard pressed, the program does not apply.
Surely, if the Parliamentary Secretary were really doing his job with the Prime Minister and with the Minister of Agriculture (Mr. Wise), he would get that program expanded so that it would cover a good percentage of farmers. There are 16,000 farmers with FCC loans, not to mention all the other mortgages that are outstanding, who are two years in arrears with their mortgages.
The Parliamentary Secretary has been telling us what great things have been done, but he has not explained everything. Perhaps we just assume that the way it will be is that oil prices will be $16 a barrel instead of $28 a barrel when the Tories are in power. Tory times are hard times so we have to be ready for them. Instead of being $200 a tonne, grain prices are $110 a tonne. It is a given that times will be tough and that the Tories will then have to do something about it.
I do not think that a modest program like this one, which provides a couple of hundred million dollars per year for economic diversification in western Canada, will be adequate to cover all of the tremendous economic downturns with which western Canada is faced, let alone the irresponsible cut-backs that have taken place to community college funding, the earned depletion allowance, the post office and every aspect of community life. I am depending on the Parliamentary Secretary to beef up this program and to make it a little more responsible and effective so that it will really help western Canada in its hour of need.


Lorne Edmund Nystrom: Mr. Speaker, I was very interested to hear the Hon. Member for Algoma (Mr. Foster) say that we should beef up the program. I certainly support that as well.
The Government is spending only $1.2 billion over five years, $60 million per province per year. That is not very much money. The Hon. Member for Assiniboia (Mr. Gustafson) would agree that we must be very disappointed that the Government is only spending $1.2 billion.

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Five or six years ago, the Liberals had a western development fund with some $4 billion. The Tories across the way were criticizing it as being too small. The Hon. Member for Athabasca (Mr. Shields) was saying how stingy the Liberal Government was to provide funds for western Canada of only $4 billion. That was not even spent.
1 just wanted to comment that I think the Hon. Member for Algoma was right when he said $1.2 billion is appreciated, but it is not very much. It is only $60 million for Saskatchewan every year. By the way, most of that money was already there anyway in different government programs, and it is now being funnelled into this program. It is a nice little program for Tory re-election prospects even though there has never been a Government in Canada as unpopular as that Government. Recent polls tell us that the Government is even more unpopular than the Trudeau Government, which is absolutely incredible.


Maurice Brydon Foster: Mr. Speaker, I appreciated that explanation. I saw the same poll which indicated 52 per cent thought it did a better job than the present Government, which got only 23 per cent support. I want to leave lots of time for the Parliamentary Secretary to the Prime Minister to defend his boss. He can explain how the Government of former Prime Minister Trudeau is seen by people as doing a better job than his own Government.
I think 1 saw the height of apology for the Government last year when the Hon. Member for Athabasca (Mr. Shields) took total responsibility for the Government not putting up a loan guarantee for the Syncrude project. I know the Parliamentary Secretary to the Prime Minister and a number of others of us went to an excellent briefing on why the federal Government should come up with its share of the loan guarantee. The guarantee would only come into effect if the price of oil went below some $15 a barrel. 1 do not think it has ever gone below that price since the fall of 1986.
The Prime Minister promised action but he did not take action. The Parliamentary Secretary to the Minister of Energy, Mines and Resources said he had not explained well enough to the Minister why the loan guarantee was needed. Everyone in the Alberta caucus, including the Deputy Prime Minister (Mr. Mazankowski), realized how important it was to increase the capacity of the Syncrude plant. The program went ahead under a loan guarantee from Alberta, but you kind of wonder why the Parliamentary Secretary has to take the rap for not explaining how important the project was.
I just do not see how $60 million a year in loan guarantees and grants and contributions for each province is going to be adequate to overcome the support which should have been forthcoming directly from the Government and not cobbled up into this program we are debating today.


Mr. Jack Shields (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Mr. Speaker, I listened with
great interest to the Hon. Member for Algoma (Mr. Foster) and the Hon. Member from the NDP. Anyone watching that debate will clearly understand the coalition between the NDP and the Liberal Party.
I must respond first to the remarks by the Hon. Member for Algoma concerning the Syncrude capacity addition project presented to the Government of Canada in which the Syncrude consortium asked for a loan guarantee. I would like to enlighten the Hon. Member that it was not the Minister of Energy, Mines and Resources who refused the loan guarantee. It was the Minister of Finance (Mr. Wilson) and his Department. The reason they gave was that the project would go ahead without it. They do not need a loan guarantee. All it is, is show. We could very well do it but if we did, it would add to the federal deficit and take money away from another area necessary to meeting our deficit goal.
At the time 1 was disappointed that we did not go ahead with the political show of a loan guarantee to that project, but in retrospect the Minister of Finance was correct in every detail. The project did go ahead without the loan guarantee. It was a wise decision on his part.
I cannot imagine being a member of the Liberal Party standing up and speaking against the western diversification program. 1 cannot fathom how this could happen from Members of Parliament who sat in this House and voted in favour of a National Energy Program which totally and absolutely devastated western Canada. That Member stood in his place and spoke in favour of the NEP which totally devastated the communities where I and everyone else in western Canada live.
I want to tell him what was happening there, admitted to by the former Liberal Minister of Energy, Mines and Resources, Marc Lalonde. He now stands up in Montreal and says the reason they brought in the NEP was because they wanted to divert money from the western provinces into the coffers of the central Government. That is what the Hon. Member stood for and that is what the NDP stood for. They were on their feet supporting the NEP. Their energy critic stood in this House and said the program does not go far enough. What we should be doing is nationalizing one of the big ones. Nationalize Imperial Oil is what they were saying. It amounted to total devastation of western Canada. This Government is now trying to repair some of the damage that those two Parties sitting in coalition did to western Canada.
Then they have the gall to stand up in this House and say we are not going far enough to support western diversification.


Maurice Brydon Foster: Point of order, Mr. Speaker. I wonder if the Hon. Member could explain why PetroCan bought out Gulf Oil, spending about $1 billion of taxpayers' money? When the Tories came to power they bought out Gulf Oil-


Mr. Deputy Speaker:: I would not exactly say that is a point of order.
March 2, 1988


Jack Wendele Shields: Mr. Speaker, I will be glad to answer that question after my remarks. The Hon. Member is getting a little hot in his seat. He understands where I am coming from and that what I am saying is true. It really bothers the hon. gentleman when the facts are laid down in front of him.
The NEP put thousands of companies in Alberta, British Columbia and Saskatchewan out of business. It put thousands of people out of work. It totally dried up the industry. Do you remember the Alsands project which was ready to go north of Fort McMurray? It was going to create something like 4,000 jobs and add another 10 per cent to the oil supply. I remember that one. I saw what the NEP did to the community of Fort McMurray. I saw what it did to Edmonton and Calgary. I saw what it did to all those drilling and exploration companies. 1 saw what it did, and for a Member who was part of the Liberal Government at that time and members of the NDP to stand up and speak against a program we are putting in place to help diversify the economy of western Canada is totally and absolutely immoral. They know full well that they were supporting the devastation of western Canada because they had a pie-in-the-sky idea. They said that they were going to have a made-in-Canada price for oil. They attempted to rob from western Canada and put it in the central Canada coffers.
How much will the $220 million a year that is going into western Canada do for western Canada? It is obvious that we have the problems which we do with regard to the deficit because all the former Government did was throw money. It did not use money in a sensible way as an incentive to bring on industry, development, and diversification. It threw money down the tube.
People remember what the Scientific Research Tax Credit did. There was such a big hole in that legislation that you could drive a Mack truck loaded with manure through it. That truck was driven through it and it cost and is still costing the Treasury of the federal Government billions of dollars. That is the kind of fiscal responsibility we saw from the Liberal Government which was supported, in many instances, by the NDP which now talks about coalition.
We heard that today in the debate. I could not tell who was speaking only by listening. I heard the same garbage from the Liberals as I heard from the NDP and I heard the same garbage from the NDP as I heard from the Liberals. They have already decided that they will form a coalition. They have looked at the polls and have decided that the Conservative Party would form a minority government if an election was held today, and they would therefore form a coalition. They have admitted that and talked about it.
Let us look at the NDP record. Let us look at what the NDP has done since we came to office. The NDP voted against the Patent Act and against removal of the National Energy Policy. Members of the NDP voted against the Western Accord which we drew up with western Canada and against the Atlantic
Western Economic Diversification Act
Accord. They want nothing but central control on industry and development. You never hear the NDP talking about diversifying the automotive industry out of Oshawa because they have Bob White and Shirley Carr to contend with. I do not know if it really matters to the New Democratic Party Leader. I do not know where he takes his orders. I think they pull a lever in Shirley Carr's office and the toilet flushes in the office of the Leader of the NDP.
The transportation Bill removed for all time discrimination in western Canada in rail transportation and the NDP voted against it. NDP Members spent six days debating the Senate amendments to the Immigration Act while we have a very real problem with immigration with which we are struggling daily. However, we had better not put that law in place because they would not be able to stand up in the House of Commons and go after the Minister of Immigration because some guy lied his way into Canada and we cannot deport him without going through a number of processes.
We spent nine days debating the Budget. Do you remember when we were trying to put the postal workers back to work, Mr. Speaker? Where did the members of the NDP stand on that? They stood up and voted not to put them back to work. We must have postal service in western Canada. We are not prepared to use courier services as they can in Toronto, Oshawa, and Montreal. We must have mail service in every community in the country, particularly in western Canada where we rely upon it so much.
We introduced legislation to put the grain handlers back to work. If you do not move the grain in western Canada, the farmers are out in the cold. The NDP voted against that as well.
It was very interesting to hear the debate today and see how much the two Parties meld together with a total lack of understanding of the problems in western Canada. The western diversification program is an historic move in this country. For once we have a western diversification program and a Minister responsible for western diversification who is from the West. We have an office and a Deputy Minister located in Edmonton where they can deal with the problems facing the West. That move alone diversifies some of the government bureaucracy with which we are faced.
Let us talk about the farmers. I heard the Member for Algoma stand up and plead the plight of the farmer. I heard the NDP stand up and plead the plight of the farmer. The present Government is the first Government that has reacted and done what has to be done for the farmers in western Canada. The Liberal Government brought in a 25-cent tax on gasoline which the farmers had to pay. We removed that in order that input costs would go down.
I could go on, Mr. Speaker. Do you remember the Canadian ownership charge at the pumps? An oil company created under the National Energy Program had its hand in every pocket in this country.

March 2, 1988
Western Economic Diversification Act
We do not for a moment say that the farming industry does not have problems. Certainly it does. However, even with a grain war waging between the United States and the European Common Market, we moved more grain this year than in any other year. We have given more help to the farmers across the country than has any other government in living memory. We have given $5 billion in assistance since we came to office. We will continue to assist the farming community in that way because we came to office with a commitment to the farm community and we have lived up to that commitment.
What is the western diversification program about? It was introduced by the western diversification office and is part of a mandate to manage the western diversification fund which was set up to stimulate diversification in the country, particularly in western Canada. It is designed in such a way as to give maximum flexibility in dealing with proposals which may come forward for western diversification fund assistance.
We always had programs designed in Ottawa in the ivory towers which we then had to make work. We were given the guidelines, the rules, and the regulations. That did not work. I can remember the old tier system and the process which had to be gone through to change it. It was based on census and employment figures. We had great disparity in the country.
There were tier 1 areas, some tier 2 areas and others that were tier 3. All of Alberta was not even considered. Alberta had gone through a period of relative prosperity until the Liberals and NDP decided to devastate Canada with their national energy policy. That threw a monkey-wrench into the whole system.
Even when there were 40,000 unemployed in Edmonton alone we did not have a chance with the tier system because it took too long to deal with our situation. In Calgary, houses and apartments were empty, businesses were going down the tube and people were being thrown out of work day after day. Yet the formula did not allow us to benefit from the economic development system.
We now have a program that has the required flexibility because the criteria has been designed in an office in Edmonton, in consultation with the people whom it will affect. The program is geared to support projects that promote or enhance economic development or diversify in some way western Canada. It includes the initiation, the promotion or expansion of enterprises, the establishment of new business, research and development activities. However, these activities will be controlled. We will not bring in a scientific research tax credit system whereby scams can take billions of dollars out of the Treasury without anything being done.
It has been suggested that this program is a smoke and mirrors exercise to make us look good. This is a flexible program that responds to the needs of western Canada. It will not have a tier structure. The West will be treated as a single region.


Leslie Gordon Benjamin: We will all be in tears.


Jack Wendele Shields: The Member says that they will all be in tears. I wonder where his tears will be when people begin to realize how lock-step the NDP and Liberals really are in the House of Commons. I would ask anyone reading today's Hansard to block out the names of those speaking on this Bill and identify whether they are NDP or Liberals. They would certainly be able to identify the Conservative Members, but the Liberals and New Democrats are lock-step with one another. They have already formed the coalition about which they have been talking.
The eligible costs have been broadened to include working capital because we found that the need for working capital sometimes created a problem. Previous programs had always been geared more to the wealthy who had the working capital and good solid backing. Now we have broadened the eligible costs through the western diversification program to include working capital. Many small businesses would like to expand but need the financing for capital expansion as well as working capital, which anyone in business will suggest is the hardest financing to obtain.
If I sitting in the Liberal or NDP benches, particularly considering the history I saw here between 1980 and 1984, I would be ashamed to stand up against the western diversification office and the western diversification program.


Lorne Edmund Nystrom: Mr. Speaker, the Hon. Member for Athabasca (Mr. Shields) claims that his Party does very well in representing western Canada. The statistics I have from Statistics Canada show that of the goods and services purchased by the Department of Supply and Services in 1981-82,
15.5	per cent was purchased in the West. In 1984-85, the first year that his Party took power, goods and services purchased in the West went down to 13.9 per cent and dropped to some
11.5	per cent in 1986-87.
Why is the federal Government purchasing less in western Canada? A decrease from 13.9 per cent to 11.5 per cent in two years is a fairly sharp drop. If the Government were to purchase a greater share in western Canada, that would stimulate the economy and create more jobs.


Jack Wendele Shields: I am pleased my hon. friend raised this. Of course, he is playing with statistics and does not present the true picture. He knows that some very major purchases have been made since we took office, particularly in defence. This includes the frigates, the CF-18, and a number of other defence procurements.
These statistics would skew the total figures. Some of those major contracts which went to the Maritimes, including the Aurora contract and the frigate contracts, will skew the numbers elsewhere.
Let me tell the Hon. Member that I know of companies that never had the opportunity to purchase from the federal Government until we took office. I never saw a Minister of
March 2, 1988

Supply and Services in Cold Lake, Grand Centre or Bonny-ville. 1 never saw him in Vegreville, St. Paul or Fort McMur-ray until this Government took office. When we took office, the Minister of Supply and Services visited the major centres in western Canada to explain how the system worked. People in the West who had the supplies and wanted to do government business did not know how the system worked because they did not have the information.
They never believed they could gain a contract, but let me cite some of the contracts that have been obtained in Alberta that would never have been given without this Government and its purchasing policy.
There is a contract in Vegreville for the supply of an approach system for airports across Canada. Northwest Industries in Edmonton has just been awarded the Hercules aircraft contract. They have been awarded the contract for the repair and maintenance of all Hercules aircraft in Canada. Indeed, that is now spilling over into the United States. You have to look at them in balance. We have more Government purchases going on in western Canada than ever before, and they also have more information out there than ever before.


Maurice Brydon Foster: I was very interested in the Hon. Member's speech when he said working capital is one of the great difficulties for small business. I certainly agree with him. Would he point out to us where in Bill C-113, an Act to promote the development and diversification of the economy of western Canada, to establish the department of western economic diversification and to make consequential amendments to other acts, it provides for working capital for small businesses, especially those in western Canada?
Second, the Hon. Member was outlining the terrible folly of the New Democratic Party in promoting the nationalization of the major oil company. I wonder if the Hon. Member could explain why, in the fall of 1984, shortly after this Government took power, Petro-Canada bought out Gulf Oil, in effect nationalizing it, because it was certainly one of our major oil companies. Why did the Parliamentary Secretary allow that to happen? I have talked to western Canadians who said that at that moment they tore up their Tory card. They could not understand why the Tory Government was nationalizing or taking over Gulf Oil and providing the little easy bump for the production side to go to Reichmanns with a write-off, I understand of about $1 billion. Why would the Government spend $1 billion taking over Gulf Oil when that was clearly different from what the Party had been promising and committing itself to, and what the Hon. Member has spoken against tonight?


Jack Wendele Shields: Mr. Speaker, there is an obvious answer and I think the Hon. Member knows it. It is because there was fear it would fall into foreign ownership. It was that simple, I think, at the time.
Western Economic Diversification Act
Let me remind the Hon. Member of the fact that since we took office there has only been one Liberal Member of Parliament representing western Canada. That is the Hon. Member for Winnipeg-Fort Garry (Mr. Axworthy), the Transport Minister in the previous Government. He is, obviously, a representative of his Party, but he voted against the repeal of the disastrous National Energy Program. He also voted against the repeal of the incremental oil revenue tax from the phase-out of the Petroleum Gas Revenue Tax, as agreed by the Western Accord. We are talking about the western representative of the Liberal Party. He has to represent the West as a Liberal. He is the only Liberal from western Canada.
He voted against the increased competition in air and rail transportation, Bill C-18. That was one program western Canada needed. It was one program that got rid of for all times freight rate discrimination. He voted against a $500,000 capital gains exemption for Canadian farmers, Bill C-84. He voted against the expenditure of $92 million for drought relief for western farmers. He voted against providing the Canadian Wheat Board with $200 million to offset its deficit. Perhaps he wanted farmers to make up the difference. At the same time he also voted against funding the development of a new grain transportation method.
He voted against increased foreign investment, the creation of Investment Canada. He voted against increased research, investment in jobs in Canada's pharmaceutical industry. He voted against the settlement of the softwood lumber dispute that had been negotiated at the request of the producing provinces, western provinces. He voted against legislation which compensated the uninsured depositors of two western banks. He did this in spite of the fact that the depositors of those banks included many municipalities, educational institutions, credit unions and school boards. He voted against $17 million of Atlantic fisheries restructuring, he voted against providing the Cape Breton Development Corporation with an extra $7 million for the modernization of the railway operation. He voted against increasing the total amount of money that may be loaned under the Small Businesses Loans Act. Where is the Liberal Party coming from? The Hon. Member for Algoma has the gall to stand in this House and ask questions when tied around his neck is a millstone in the form of the Hon. Member for Winnipeg-Fort Garry, who is supposed to represent western Canada. I cannot believe it.


Mr. Deputy Speaker:: Resuming debate with the Hon. Member for Regina West.


Leslie Gordon Benjamin: Mr. Speaker, on a point of order, considering the hour, I wonder if I could ask for the pleasure of the House that we adjourn the debate now and resume the next day this Bill is called, rather than using the few minutes that remain?


Frederick James (Jim) Hawkes: Mr. Speaker, I have heard a lot of positive comments about the need for such initiatives. In response to my hon. friend, perhaps, Mr. Speaker, you would find unanimous consent not to see the clock. The Member could

March 2, 1988
Western Economic Diversification Act
then complete his speech and we could get the Bill to committee before we adjourn for the evening. Do I see agreement over there?
It looks like the New Democratic Party does not agree. We are anxious to complete the debate and I would suggest that the Hon. Member begin his speech and perhaps in a few minutes those Members might feel differently and allow it to continue and perhaps get the Bill to committee.


Leslie Gordon Benjamin: We would be most agreeable to not seeing the clock but that does not finish the debate.


Frederick James (Jim) Hawkes: If there is unanimous consent, we will just agree not to see the clock and will continue debate.


Lorne Edmund Nystrom: Mr. Speaker, I think what the Hon. Member for Regina West (Mr. Benjamin) would be interested in doing is not to see the clock until he finishes his speech. However, out of fairness to other Members who wish to speak on this Bill, we will have to come back to this debate on another day.


Jack Wendele Shields: Mr. Speaker, I think we are prepared not to see the clock. If we do not see the clock, there should be no time limit on not seeing the clock. Let the Member finish his speech and let those who wish to speak come back to the House and do so. We want to get this Bill to committee and we want to get it there as fast as we can because westerners are waiting for this Bill. It has a real impact on western Canada. Let us get it through. Why the filibuster?


Mr. Deputy Speaker:: The Chair, of course, will do whatever the House wants, but the Chair is not clear as to what the House wants now.


Maurice Brydon Foster: Mr. Speaker, obviously there is no agreement so I suggest that the debate continue until 6.39, which is the time of adjournment, and if we have not then completed the Bill before the House, we can continue debate at the next sitting of the House or whenever.


Mr. Deputy Speaker:: The debate will continue until 6.39 with the Hon. Member for Regina West.


Leslie Gordon Benjamin: Mr. Speaker, I get nine minutes now and eleven minutes the next time the Bill is called. I just suggested we shut her down for the rest of this day and I could speak for the whole 20 minutes all at once. I hope my friend, the Hon. Member for Athabasca (Mr. Shields), sticks around.


Jack Wendele Shields: No, 1 will not.


Leslie Gordon Benjamin: That figures. He is a good hit and run artist.
I have been through this diversification thing for the umpteenth time, ever since I was a kid in the dirty thirties. I heard about it with respect to western Canada and Atlantic Canada. I heard about it with respect to the North and northern Ontario, the divisions of the North, the Roads to Resources.
We have had nothing but Grits and Tories in Government for 125 years. R. B. Bennett was going to blast us into the world markets. He was going to diversify the economy.


Lorne Edmund Nystrom: He did blast us!


Leslie Gordon Benjamin: We got blasted all right, on to $5 per month relief. Then we got the Liberals. The war saved us for a while. After the war the Liberals said that they would diversify and that they would get us into the world markets. "We have to diversify", they told us. The only thing that saved R. B. Bennett was that he told us to diversify out west, which we did, and then it did not rain. So we got dried out.
The Liberals came along then and said: "We have to diversify". Again, the people out west believed them and they diversified. We were up to our eyeballs in grain. We had a glut that some would not believe. Our people out west diversified into livestock of all types, poultry and even bee keeping. A whole bunch of little businesses started up, plants and whatnot, to build feed bins and to help construct feedlots, et cetera. We then diversified all over the place. Grain prices were cheap. One could buy three bushels of barley for $1. At that price one could afford to feed cattle.
So we went into cattle and hogs. We raised so many cattle and hogs that two things happened. First, the Americans slapped an embargo on us because we were sending too many down there. Second, the price dropped to less than it cost for a bushel of barley. We have been through that one, too. This was in the 1950s and the 1960s.
Then we got to the 1960s and the 1970s. We had mostly Liberal Governments. We had Tories right up until 1979, including 1979, who talked about diversification.
We decided that in order to diversify we would grow all this rapeseed which is now called Canola and make vegetable oil out of it. We built about eight plants in western Canada as part of diversification. We quit growing so darn much wheat and so darn much cattle, hogs and chickens.
We just got into the diversification plan for the fourteenth time in the last hundred years and what happened? The Government decided to give tens of millions of dollars to oilseed processing plants. Where? In southern Ontario. What did they process? Soybeans from the United States. Of the eight plants that we used to have in western Canada there are now two left. So much for that episode of diversification.
Mr. Speaker, please forgive me for feeling a bit of cynicism.
I do not like being a cynic. It is the last resort of the guy who gave up. One can hardly blame me for saying: "Again?" Unless and until a national Government, whether it be made up of Conservatives, Liberals or NDPers, decides to get together with the business community, the trade union movement and the agricultural community to have a planned economy and direct the location of industry and provide it with an equality of opportunity to compete in the markets in central
March 2, 1988

Canada and outside Canada, then diversification plans for Atlantic Canada or western Canada will go down the drain just like all the other ones have before. We have been through this innumerable times.
It means that we have to say to central Canada, and I am sure that there are people in Toronto, Montreal and Ottawa who will agree, that those places do not need to get any bigger. They cannot even keep up with their housing requirements and the municipal facilities that their people and industry need. They are way behind. They cannot even get rid of all their garbage.
The next time an industry wants to start up it should be provided with the capacity to go into business in Atlantic Canada or western Canada and be able to present its production in the markets of central Canada or anywhere else in the world in equal competition with those which make the same products. Let me give Hon. Members an illustration of that point.
We used to ship 10 to 12 train loads of western coal a day from Saskatchewan, Alberta and eastern British Columbia to central Canada for heating and for the production of electricity. What has happened since then? We keep raising Cain in the House time and time again about acid rain which is caused by high-sulphur coal, brought in from where? The United States. If this western diversification plan worked to do anything, it would provide an equity of transportation costs. We would move western coal to the tune of 10, 12 or 15 train loads a day, even if it was only as far as Thunder Bay. We could then ship it by water through the Seaway to all the power plants, particularly those of Ontario Hydro. Yet here we sit. We are up to here in coal in the three most western provinces. It is low-sulphur coal which would do more to reduce the production of acid rain inside Canada than anything else. The problem is that under the free trade agreement, the Americans would not like that because a statutory coal rate would be needed, just like a statutory grain rate.
We can talk all we like about whether it is $200 million per year or $1 billion per year for the next five years. Unless we reorder the location, the production, the manufacturing and the processing of our products and resources, they will fail. We have been through this several times before.
I am several times bitten; I am more times shy. At the moment we have an excellent poultry producer in Wynyard, Saskatchewan. He diversified. He has hundreds of thousands of dollars invested in that plant. He received some grants from the federal and provincial Governments. He produces marvellous roasting chickens. One can go to the Safeway or the Coop in Regina to buy them. They are beautiful. The problem is that he diversified. The same stores are selling chickens produced in Georgia-


Frederick James (Jim) Hawkes: Mr. Speaker, I rise on a point of order. The Hon. Member's remarks are interesting. In light of some of the
Western Economic Diversification Act
earlier conversation, will the Opposition agree not to see the clock and allow the Hon. Member to complete his speech and perhaps have another? This would leave us with a much shorter length of time for the next day of the debate. That might enable us to get the matter to committee somewhat quicker.


Mr. Deputy Speaker:: The House has heard the terms of the request. Is there unanimous consent?


Some Hon. Members:: No.


Mr. Deputy Speaker:: There is not unanimous consent.


Leslie Gordon Benjamin: Why does the Hon. Member not make up his mind? That is what 1 proposed in the first place and he said no. If Hon. Members would like to let me finish my 20-minute speech we could then adjourn the debate and resume it the next day that it is called.


Mr. Deputy Speaker:: Is there unanimous consent to allow the Hon. Member for Regina West to complete his speech and then to adjourn the House?


Some Hon. Members:: Agreed.


Leslie Gordon Benjamin: Mr. Speaker, as I was saying before I was so rudely interrupted, we have been through this diversification bit before. The thrust of a national Government's policy, of any of the three political Parties in this place, has to be the reordering of our economy and the reordering of the location of the production of that economy. Without that, eastern, western or northern diversification programs are doomed to fail. We have tried them many times before. If we are going to do what the Government states that it wants to do, then it has to face up to the fact that the free trade deal goes down the drain. Everything that the federal Government in co-operation with the provinces tries to do will be deemed by the Americans to be a subsidy.


Mr. McDermid:: Baloney!


Leslie Gordon Benjamin: Well, they have already done it, they are doing it now, and they will continue to do it.
Members of the U.S. administration, the U.S. Congress, state governors and legislatures are already accusing us of subsidies on programs that national governments, be they Liberal or Conservative, designed to assist in regional development. That is the reality that this Government or any other Party that forms the Government of Canada will have to face up to.
In order to make a regional development program succeed, the Government of this country, of any political stripe, has to make a decision not to discriminate against any other region, not to discriminate against any other country, but to discriminate in favour of an underdeveloped region. Discrimination for rather than discrimination against is 100 per cent different.

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Western Economic Diversification Act
For a regional development fund to be effective, whether it is in western Canada or Atlantic Canada, we have to take into account our geography, our climate, and the distances we have to face to get our production into the market-places in central Canada, or anywhere else in the world. To attempt to do anything other than that is doomed to failure.
The problem with the Conservatives and Liberals is that they have never learned from their own history, and they are attempting to repeat it. If they wish to do things about western development, my good friend, the Hon. Member for Assiniboia (Mr. Gustafson) and I will have to persuade the President of the Treasury Board (Mr. Mazankowski), the Cabinet, and the Minister of Transport (Mr. Crosbie) to complete the rehabilitation of railway lines. If any self-respecting investor wants to build a plant, he is not going to do it in Assiniboia, Weyburn, Moose Jaw, or in any other place where there is no railway line. The Government has reneged on the rehabilitation of railway lines to the tune of something in the order of $138 million. That is how far behind we are, and there is this year and next year left.
The Hon. Member for Assiniboia and I have tried our best. We have had some modest success, last minute changes of heart by the bureaucrats in the Department of Transport, and maybe with the Minister of Transport.
Surely that is the type of investment that pays off for western Canada. I find it appalling when Conservatives talk to me about having a government run by sound business practices, when two or three years ago it sunk $10 million into a branch line 77 miles long and refuses to finish the job, which will take another $13 million. That is in the Bengough subdivision in my hon. friend's riding. The Hon. Member and I have both been fighting to get that done. The way it sits now is that this Government, with all its western diversification plans, will let that $10 million that has already been spent go down the drain, just throw it out. The other $13 million has to be spent to finish the rehabilitation of that railway line, or $10 million will be totally wasted. That job has to be done. It requires $138 million between now and the end of November, 1989. The rail line rehabilitation alone is half of what the Government proposes to spend in each year for five years.
If they want to do some things for western Canada, why don't they finish what has been started? The Liberals started this particular project, but why does the Government not finish what it states is a good idea before starting into other things? It does not have the slightest idea in what direction to go.
One cannot diversify. There cannot be a champagne production and a champagne economy in a beer market. The beer market is the small market of western Canada. I consider western Canada anywhere from Sudbury west. I consider eastern Canada from Quebec City east, and all of northern Quebec. Unless we reorder, we say to industry and the market in central Canada that we will lay down production, manufacturing, and service materials from western Canada and Atlantic Canada. We will lay it down in the market in central Canada, in the United States, or anywhere else in the world, at a price that you will have to compete with in terms of quality, quantity, delivery, warrantys, and everything else, but the cost of getting it there will be equal.
Surely that is fair. Surely that takes into account our geography. If the Minister of Transport (Mr. Crosbie) had $500 million that he did not know what to do with, he would be stupid to invest it in some kind of a manufacturing or processing plant with western Canada or Atlantic Canada in the type of conditions and economy that we presently have. It would be dumb. If he went for a banker to a loan, he would be laughed out of the place.
A planned economy requires a reordering of the location of our productive capacity, whether it is in manufactured goods or in agricultural processing. There is more to Canada than Montreal, Ottawa, and Toronto. They do not need any more. They cannot handle all they have now. That is what we have to do, no matter what Party is in government.
I wish to assure the Hon. Member for Assiniboia (Mr. Gustafson), when this Bill is called for debate, that I will be here to participate in the 10-minute question and answer period.


Mr. Deputy Speaker:: It being 6.49 p.m., this House stands adjourned until tomorrow at 11 a.m.


[Stage Direction]
The House adjourned at 6.49 p.m.
[Stage Direction]

Thursday, March 3, 1988
[Stage Direction]
Prayers