1988-08-25

Hon. James Kelleher (Solicitor General of Canada):: Mr. Speaker, I would like to table, in both official languages, a draft Bill which reflects our Government's proposed parole reform.


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



CORRECTIONAL INVESTIGATOR ACT


Mr. Richard Grise (Parliamentary Secretary to Deputy Prime Minister and President of the Privy Council):: Mr. Speaker, pursuant to Standing Order 106(8), I have the honour to table in both official languages the Government's response to seven petitions numbered as follows: 332-5210, 332-5212, 332-5213 and 332-5217 to 332-5220.
[Editor's Note: See today's Votes and Proceedings.]


James Francis Kelleher: for leave to introduce Bill C-154, an Act to establish the office of Correctional Investigator.


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


Some Hon. Members:: Agreed.


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


Mr. Paul Gagnon (Calgary North):: Mr. Speaker, I have the honour to present, in both official languages, the tenth report of the Standing Committee on Energy, Mines and Resources.



CRIMINAL RECORDS ACT


James Francis Kelleher: for leave to introduce Bill C-155, intituled An Act to amend the Criminal Records Act.


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


Some Hon. Members:: Agreed.

August 25, 1988
Business of the House


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


Some Hon. Members:: Agreed.


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


Some Hon. Members:: Agreed.



CANADA WATER PRESERVATION ACT


Hon. Tom McMillan (Minister of the Environment) moved: for leave to introduce Bill C-156, intituled An Act for the preservation of Canadian water resources.


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


Some Hon. Members:: Agreed.


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


Some Hon. Members:: Agreed.


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


Some Hon. Members:: Agreed.



CENTENNIAL FLAME RESEARCH AWARD ACT


Mr. Patrick Boyer (Etobicoke-Lakeshore) moved: for leave to introduce Bill C-318, an Act respecting the establishment of the Centennial Flame Research Award, to publicize the contributions to Canadian public life of persons with disabilities.


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


Some Hon. Members:: Agreed.


Mr. Speaker:: The Hon. Member under the rules is now given the occasion to make a brief explanation of the Bill. I am sure he will have the attention of all Members.


Patrick Boyer: Mr. Speaker, my enthusiasm to proceed I am glad to see is matched by the willingness of the House to hear me.


Some Hon. Members:: Oh, oh!


Patrick Boyer: Briefly, this Bill relates to the Centennial Flame fountain on Parliament Hill into which fountain tourists each year throw coins. Over $1,000 is gathered from that fountain. I was amazed to learn that the coins go into the Consolidated Revenue Fund.
The purpose of this Bill is to do something a little more special with those coins. In effect, a fellowship is to be established with the money obtained from the Centennial Flame fountain on Parliament Hill and each year the amount will be awarded to a Canadian with disabilities to do research on the contributions to Canadian public life and to the Parliament of Canada of individuals with disabilities.


Some Hon. Members:: Hear, hear!


Mr. Speaker:: I think the Hon. Member has had some expression of the feeling among all Parties for the support of the initiative that he and others are taking in this Bill.
It may be an opportunity for the Speaker to say that what we are trying to do here is in the cause of fellow Canadians who are disabled. I appreciate more than I can say the amount of support that I have received from all Hon. Members from the committee on which the Hon. Member serves, especially some Hon. Members who have put exceptional effort into the cause in which I know we all join. 1 hope this reflects the kind of leadership that is expected of us in this place.


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

Hon. Doug Lewis (Minister of State and Minister of State (Treasury Board)):: Mr. Speaker, I am tempted to start these remarks by asking whether or not it is Saturday today, but I will not.


Some Hon. Members:: Oh, oh!


Douglas Grinslade Lewis: There have been discussions among the Parties and I appreciate the co-operation of the Opposition Members in coming to the following agreement which I think will meet the acceptance of the Members of the House. Before reading the motion, I should say that there is an understanding among the Parties that the items on the projected Order of Business for today, namely Bill C-148 and Bill C-153 will be dealt with in all stages by one o'clock p.m. today.
August 25, 1988

The motion I have to put to the House is this. I move:
That the House shall complete its consideration of Bill C-139, an Act to amend the Income Tax Act, the Canada Pension Plan, the Unemployment Insurance Act, 1971, the Federal-Provincial Fiscal Arrangements and Federal Post-Secondary Education and Health Contributions Act, 1977 and certain related Acts, by Friday, August 26, 1988, but with any division or divisions deferred until six o'clock p.m. Monday, August 29, 1988;
That Monday, August 29, 1988 and Tuesday, August 30, 1988, shall be designated as the two days allotted for third reading stage of Bill C-130, an Act to implement the Free Trade Agreement between Canada and the United States of America, pursuant to the order made August 16, 1988;
That any division requested on Bill C-130 shall be deferred until three o'clock p.m. on Wednesday, August 31, 1988;
That, following any such deferred division, or as the first order of Government business on Wednesday, August 31, 1988, as the case may be, Bill C-114, an Act to provide for greater certainty in the reconciliation of the personal interests and duties of office of Members of the Senate and of the House of Commons, to establish a Conflict of Interest Commission and to make consequential amendments to other Acts, shall be called for second reading;
That second reading of Bill C-114 and voting on any question related thereto shall be completed not later than 5.45 o'clock p.m., Thursday, September 1, 1988.
That on that day, immediately following such proceedings, the House shall stand adjourned until 11 o'clock a.m. Tuesday, September 13, 1988, provided that (a) the provision of Standing Orders 5 and 68(3) and 68(4) shall remain in effect during such adjournment; (b) if necessary, at the request of the Government during such adjournment, Mr. Speaker shall fix a time for the purpose of the giving of Royal Assent to any Bills which have not been given Royal Assent, and that after the giving of Royal Assent to any such Bills, the House shall stand adjourned to the time and the day stated in this order; and
That, the reports of the legislative committees on Bill C-144, an Act to authorize payments by Canada toward the provision of child care services, and to amend the Canada Assistance Plan in consequence thereof, and Bill C-136, an Act respecting broadcasting and to amend certain Acts in relation thereto and in relation to radio communication, (if they have not been tabled) shall be receivable by the Clerk of the House during such adjournment and shall be deemed to have been reported and stand on the Order Paper for report stage consideration on or after Tuesday, September 13, 1988, provided, that, the Notice Paper shall remain open until six o'clock p.m. on Monday, September 12, 1988, for the sole purpose of receiving report stage motions to either of these Bills.


Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, I am pleased to say that on behalf of our colleagues, we have been made aware of this proposal by the Government and we have agreed to the provisions contained in the motion. We are prepared, on our side of the House, to give the unanimous consent for its introduction and its passage.


Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, 1, too, want to indicate the support of my Party for the orderly progression of events between now and next Thursday at 5.45 p.m. 1 appreciate the opportunity to have worked with the Government House Leader (Mr. Lewis) in developing this, but I do have some questions.
It is my understanding that following dealing with Bills C-148 and C-153 this morning, we will deal with Bill C-139 after 3 p.m. today with the anticipation that report stage will be completed this evening. In the first paragraph of the
Business of the House
Government motion, it provides that the House will complete its consideration of Bill C-139 by Friday, August 26, but with any division or divisions deferred until 6 p.m., Monday, August 29. Is it the intention that votes on report stage amendments also be deferred, if any are called tonight, until Monday, or would we go through the normal procedure of having report stage votes dealt with this evening in order to move on to third reading tomorrow?


Douglas Grinslade Lewis: Mr. Speaker, this procedure will work if the report stage amendment upon which a standing vote has been requested is dealt with this evening and the motion to concur in report stage immediately thereafter. That is the way it would have to work.


Iain Francis Angus: Mr. Speaker, 1 have a couple of other questions. There is nothing in the order that refers to a quorum call. I wonder if it is the Government's intention not to prolong hours after the normal time of adjournment because of this procedure we have developed, and the flip side of that would be that we would not endeavour to call quorum.
Perhaps the Deputy Government House Leader could indicate what legislation he anticipates we would be dealing with commencing September 13. Second, will we go back to regular hours as provided for under the Standing Orders? Perhaps he could give us an indication of the intention, once we return on the thirteenth, assuming we are not interrupted by an election call, with regard to standing committees of the House.


Douglas Grinslade Lewis: There is an informal understanding among the Parties that during the period covered by the order, there would be no extension of hours under 9(4)(a), nor would there be any quorum calls. I did not feel we had to put that in the order, but it is a very legitimate question and I am pleased that this has been clarified.
Second, pending the completion of the legislative committee report and the tabling thereof with the Table up until September 12, it would be the Government's intention to call report stage of the broadcasting Bill on September 13.
With respect to the question of regular hours, the hours effective September 13 will be the normal hours of the House, but I am sure we can accommodate my friend if he in fact wishes to revert to the scintillating and stimulating long hours we have had over the past seven or eight weeks.


Iain Francis Angus: What about committees?


Douglas Grinslade Lewis: I will be quite honest with my hon. friend. I have not got my head around what the standing committees will do. That is something we could think about, as to whether or not they want to start regular hours. I think that is basically in the hands of the standing committee chairmen and the members of the committee.

August 25, 1988
Petitions


Mr. Cassidy:: When's the election?


Douglas Grinslade Lewis: Ask Nicolas.


Mr. Speaker:: Perhaps before this fragile accommodation falls apart, I had better put the matter to the House. Does the Hon. Minister of State for the Treasury Board have the unanimous consent of the House to move the motion?


Some Hon. Members:: Agreed.


Mr. Speaker:: The House has heard the terms of the motion. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

Don Boudria: Mr. Speaker, perhaps this would be a good time, given that we have now adopted this motion to end these, shall we say, difficult hours next Thursday, to recognize the very special work of our staff, some of whom have been up all night for a number of nights. 1 am thinking of Hansard reporters and so many other people who are sometimes invisible to us here in the House but nevertheless work so hard. Having seen them over the last few days in, shall we say, a tired state, I think we should acknowledge, recognize and thank all of those people who have worked so long for us during hours which have been so lengthy.
We know, of course, that we as Members of Parliament get danger pay for doing this but many of them of course do not. They have had to sacrifice personal time and summer holidays and have generally had to put up with very difficult working conditions, conditions which I am sure they would not like to work under on a permanent basis. I would like, on behalf of my colleagues, to offer a vote of thanks to the staff for their very hard work, and I hope that the House would join me in expressing that gratitude.


Some Hon. Members:: Hear, hear!


Iain Francis Angus: Mr. Speaker, I, too, on behalf of my caucus colleagues, want to express my thanks to all of the staff who have given yeoman's service this summer. The Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) has expressed it very well, and I do not want to duplicate what he has said, but I do want to add one thing, without being partisan.
I think that when future governments make decisions to keep the House open during the summer, they should take into consideration the ramifications of this on our staff. We cannot function without them. Particularly some of the groups like the Hansard reporters are stretched extremely thin, and 1 think we do them a grave injustice by forcing them to remain here throughout an extended period of time without ensuring that
they have adequate resources with which to fulfil the services we require of them.
I would suggest to you, Mr. Speaker, as the one who is the ultimate employer of the staff on the Hill, that the next time a government comes to you to ask for extended hours, that that be the first thing you consider before you consider the rationale the government gives you.


Douglas Grinslade Lewis: Mr. Speaker, I must admit that I had intended to make the same comments but to make them next Thursday as we rise for a short recess. However, that does not mean to say that 1 would not join, on behalf of government Members, in the remarks of my colleagues opposite, and state that in this business of government, one cannot always plan what one wants to do and how much one has to do.
We on the Government side are indebted, as are opposition Members, to the efforts of our staff. I think the record will show when this Parliament is compared to other Parliaments, in terms of the number of Bills passed, that this Parliament is some 30 per cent ahead of the last two four-year Parliaments in terms of the amount of work that has been churned through the House and committees.


Don Boudria: That shows the result of the tremendous cooperation by the Opposition.


Douglas Grinslade Lewis: There are two views here. One view, held by the majority of Members of the House, is that it is the result of hard work by Government Members. There is a second view shared by a small minority of the House that it is due to the co-operation of the Opposition. Some days there is a heck of a lot more co-operation than others.
In any event, I want to join with my colleagues in thanking the staff of all Members who have assisted us.


Some Hon. Members:: Hear, hear!


Mr. Speaker:: It is appropriate for the Chair to join with Hon. Members in extending my appreciation and thanks to all who have worked so hard to make this place function. That is said most sincerely. I want to assure all of our staff that we are very conscious of the contribution they make to this House of Commons and our country.


PETITIONS
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, pursuant to the provisions of Standing Order 106 I have two petitions signed by residents of Winnipeg. One says that the Conservative Government had no mandate from the Canadian
August 25, 1988

people to conclude a free trade agreement with the U.S. The Prime Minister (Mr. Mulroney) promised that in the course of bilateral trade negotiations Canadian sovereignty would not be compromised.
The other petition, on the same subject, points out that the proposed trade agreement would deny Canada the policy freedom to determine its own economic future and undermines our ability to build a society distinct from that of the U.S.
Therefore, the petitioners humbly pray and call upon the Parliament of Canada to dissolve and allow the people of Canada the opportunity to accept or reject the proposed free trade agreement through a national general election.


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


Mr. Speaker:: Shall the questions stand?


Don Boudria: Point of order, Mr. Speaker. Given the motion we adopted earlier today whereby Parliament will adjourn next week, I wonder if I could get a commitment at least from the Government to answer Question No. 289 which, according to our rules, was supposed to have been answered on May 1, 1988, but remains unanswered.
I have raised this on several occasions and I do not want to belabour the point. Perhaps we can get a commitment from the Government that if it cannot answer it today, at least it will answer it, pursuant to our rules, on or before the adjournment date next week.


Richard Grisé: Mr. Speaker, 1 have taken note of the suggestion of the Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) and will get back to him with the necessary information.


Mr. Speaker:: Shall the questions stand?


Some Hon. Members:: Agreed.


PRIVILEGE
Mr. Edouard Desrosiers (Hochelaga-Maisonneuve):: Mr. Speaker, I rise today on a question of privilege, to clarify something that was reported in an article in the Journal de Montreal on August 24, 1988.
Canadian Centre for Management Development Act
The article implies that I personally pocketed money raised by a benefit dinner on October 23, 1987. Mr. Speaker, I have never taken money raised by a benefit dinner.
Mr. Nolan Buteau, who was in charge of organizing the event, assures me that he handed the money raised by the dinner over to my riding office, so that it could be passed along to the Riding Association by my staff.
Mr. Speaker, I deny the allegations in that article, and I bitterly deplore the fact that certain Members, contrary to the Parliamentary tradition of this House, have allowed themselves to make defamatory accusations based on unverified assertions in a newspaper article.
Out of respect for this House and for my colleagues I wanted to clarify this regrettable situation. Thank you, Mr. Speaker.


RECTIFICATION REGARDING ARTICLE IN THE GLOBE AND MAIL
Mr. Claude Lanthier (LaSalle):: Mr. Speaker, I would like to advise this august House, in connection with an article published in the August 22 edition of The Globe and Mail, that I consider it my duty to state that what I said was misquoted, misinterpreted, misunderstood, misrepresented and mistranslated.
Mr. Speaker, I assure you that at no time did I refer even indirectly to any Member of this august House. It is unfortunate that this incident, over which I had no control, may have caused some inconvenience to my esteemed colleagues in the House of Commons.



GOVERNMENT ORDERS


Hon. Otto Jelinek (for the President of the Privy Council) moved: that Bill C-148, An Act to establish the Canadian Centre for Management Development and to amend certain Acts in consequence thereof, be read the second time and referred to a legislative committee.


Richard Grisé: Mr. Speaker, it is a pleasure to introduce Bill C-148, a bill to establish the Canadian Centre for Management Development.
This bill embodies the principles first set out by the Prime Minister (Mr. Mulroney) and reinforced by the Deputy Prime Minister (Mr. Mazankowski) in announcing the establishment of the Centre in a speech to the public policy forum in Toronto, April 14, 1988. In that speech, the Hon. Don Mazankowski noted that:

August 25, 1988
Canadian Centre for Management Development Act
"The Centre's principal purpose will be to enhance public sector management capacities and to develop and promote a strong corporate culture in the federal Public Service. Our vision is a credible national, world-class centre of excellence in teaching and research into public sector management.
"The six objects of the Centre address the need for our senior managers to equip themselves with new knowledge, skills and managerial techniques consistent with the requirements of the rapidly changing government environment. Daily, senior managers face such challenges as improving productivity while exercising fiscal restraint, dismantling bureaucratic rules and procedures while adapting to increased managerial accountability."

Given the need to reduce public spending for the foreseeable future, Public Service managers are and will be expected to provide more services of a higher quality with fewer human and fiscal resources. We are proud of the quality of our public service, and I believe that in establishing this centre we are building our strength and building for tomorrow. All governments and the Canadian public will be better served by Public Service managers who are trained and equipped for the challenges of the future as well of those of today.

The objectives of the management training programs, courses, seminars and research conducted by the Centre, which are set out in the bill, are very important. 1 am sure they will be strongly supported by all Members of this House. Some of the most important themes include: encouraging pride and excellence in the management of the Public Service; fostering a sense of the purposes, values and traditions of the Public Service; providing the hard skills and knowledge to respond to change and manage government programs and services efficiently and effectively; encouraging the attraction of persons of high calibre to the Public Service, and support their growth and development; encouraging a greater awareness in Canada of issues related to public sector management and the process of governance and involving a broad range of individuals and institutions in the Centre's pursuit of excellence in public administration.
The Centre will be advised by an independent advisory council made up of outstanding Canadians from the Public Service, private sector and academic community.
This bill is designed to ensure that the Canadian Centre for Management Development, with the guidance of its advisory council and leadership of its principal, will have substantial independence in managing the intellectual aspects of its own affairs. Through this independence, the Centre is guaranteed the flexibility and opportunities to consult widely in the development of world-class management programs consistent with the requirements of a highly qualified Public Service.
[DOT] (M40)

The centre will be advised by an independent advisory council made up of outstanding Canadians from the Public Service, private sector, and academic community. The centre
will be located in the historic LaSalle Academy in the National Capital Region. In addition, the centre will continue to operate in Touraine, Quebec, and will operate programs through existing federal facilities in western and Atlantic Canada. The centre will consult with individuals, institutions, and organizations concerned with management training in all regions of Canada to ensure that its programs, courses, seminars, and research benefit from the diversity of specific regional requirements in all parts of Canada.

1 am confident that this Bill addresses the need for change in the way in which our senior public servants are prepared for management roles. 1 am also confident that all Members recognize the importance of a well-qualified professional management cadre in the Public Service. I hope that all Members can support this Bill and expedite its passage through all stages today in order that it may be sent to the Senate as quickly as possible.
Mr. Speaker, I thank you for this opportunity to introduce a piece of legislation that marks a turning point in the history of the Public Service of Canada. This Bill is an expression of the Government's commitment to the continued excellence of the Public Service and faith in the continuing contribution of the Public Service to the good governance of this country.
Mr. Speaker, I would like to conclude by thanking the Opposition parties for agreeing to pass this Bill today.


Don Boudria: Mr. Speaker, it is with great pleasure that I take part today, on behalf of my colleague, the Hon. Member for Ottawa-Vanier (Mr. Gauthier), in this debate on second reading of Bill C-148.
First, I would like to correct an error made by our friend opposite when he said that the school of advanced studies in Government administration, or Canadian Centre for Management Development, as it is called in the Bill, was initiated by the Prime Minister (Mr. Mulroney). It is important to set the record straight and give to Caesar what is his due, Mr. Speaker, for it was the Hon. Member for Ottawa-Vanier who first put forward this idea in 1974. So it should not be thought that the Prime Minister invented the wheel in this matter, as that is clearly not the case. Although we are grateful to the Government for having finally introduced the Bill at last, it must not be given the credit for the original idea. That would be a mistake, I think, and I am sure Canadians would not want to be misled, even if inadvertently.
Then, Mr. Speaker, on October 31, 1977, the Honourable Member for Ottawa-Vanier introduced in the House his Bill C-304. I have a copy of that Bill before me, and it attests to the fact that it was really and truly he who proposed this initiative. In 1977 my colleague moved two motions in the House for discussion of this matter, one on May 6 and the other on October 31, 1977. In 1981, he moved a new motion, which this time was debated in the House. Finally, in 1987, he once again had a motion put on the Order Paper to establish a national school of government administration.
August 25, 1988

So I hardly need to say, Mr. Speaker, that we of the Liberal Party are in complete agreement on this Bill, because it represents a Liberal initiative. We are proud of it, and we are happy to see that the present Government has adopted this good idea of my colleague's, the Honourable Member for Ottawa-Vanier.
The need for such a Centre is clear, since it arises in part from the study of the merit principle within the Public Service, known as the D'Avignon Report, which was launched by the Liberal government of the day.
1 shall keep my comments very brief, Mr. Speaker. I would be happy if in Committee of the Whole House we could discuss clause 4 and see, for example, how the whole matter of centralization of copyright and so forth will operate, under the Centre's direction. I would also like the Parliamentary Secretary to give us details about this matter, but I will not take up the House's time at this point. Perhaps it could be clarified in a few minutes' time, in Committee of the Whole.
In conclusion, Mr. Speaker, 1 would like on behalf of my colleagues in the Liberal Party to express once again, to reiterate, our support for this initiative, an initiative that was first brought before this House, as I said just now, in 1974, by the Honourable Member for Ottawa-Vanier.


Michael Morris Cassidy: Mr. Speaker, I have had a chance to look at the Bill and to read some of the statements made by the Deputy Prime Minister (Mr. Mazan-kowski) and by Jack Manion, a distinguished public servant who is the principal designate for the proposed Canadian centre for management studies. The New Democrats will support this Bill, but I must make a few comments on it. If we were in government we would perhaps do it a little differently than is being proposed by the Conservatives. Perhaps that is because they are Conservatives and we are not.
There are some general problems in terms of access to management positions in the Government of Canada which are not being resolved by the present Government and 1 believe they should be addressed by the centre for management studies. The question of interface and co-operation between the proposed centre and public administration programs across the country is one which needs to be addressed in a rather serious way. We are talking about a substantial new management education facility. There are probably a dozen programs in public administration in different universities across the country including Carleton University, Queen's, and York, of which I am a graduate. I am sure there are many others across the country.
Mr. Manion suggests that those centres of public administration have been devoted far too much to policy analysis and not really to public sector management. It seems to me that one of the priorities ought to be to try to work with various programs of public administration to get to the questions of
Canadian Centre for Management Development Act
management and not only to the questions of policy analysis, program evaluation, and that kind of thing.
The board of the centre has been announced. I am afraid I do not have the names before me. However, 1 suspect the list is short in terms of the number of women who have been appointed. I believe that one of the priorities for the centre should be to facilitate and accelerate the movement of women into management positions in the Government of Canada.
The recent announcement made by the President of the Treasury Board (Miss Carney) was more than disappointing. It suggested that by 1991 the representation of women in the management category of the Government of Canada stands to be increased by about 200 from 1987, up to 678. That is 50 a year, which is not very many. We know that most of those women are likely to be at the junior, rather than the senior management levels. They would be about 15 per cent of the employees in that category. That is not good enough, if there is a real commitment to equality and affirmative action by the government of the day. Certainly we hope to see that greatly improved.
The other area of preferred positions on which employment equity was meant to apply was in the scientific and professional areas, where the Government in fact anticipates not an increase but a reduction in the number of women in those positions by some 200 in the course of the next three or four years.
A number of the people who should be considered for management positions are now in bargaining unit positions.


Mr. Turner (Ottawa-Carleton):: Mr. Speaker, as I understand the rules of the House there is a rule of relevancy. With all due respect, the Member is not focusing on this Bill but on management practices within the Public Service itself. I would like you to reflect on those rules, Mr. Speaker, and ask the Member to focus specifically on Bill C-148, which is the creation of a new management study centre for managers in the Public Service. It has nothing to do with quotas in the Public Service itself.


Mr. Deputy Speaker:: The Hon. Member for Ottawa Centre has the floor. He may continue.


Michael Morris Cassidy: Mr. Speaker, thank you for ignoring that irrelevant point of order.
The point 1 am making is that the centre for management development which is being set up and intends to be a centre for excellence has a specific role with respect to management in the Government of Canada. I believe one of those roles is to ensure that women managers and women intending to be managers should be facilitated and encouraged. One way to do that would be to ensure that there is a substantial number of women on the advisory board of the council of the centre in order that that priority is not forgotten.

August 25, 1988
Canadian Centre for Management Development Act
I would like to have seen representatives of the Public Service unions on the advisory board. 1 would like to have a commitment from the Government that that will be its intention, should it have a chance to form a government after the forthcoming election.
While it may be somewhat surprising to Mr. Manion, since the centre will be moving its activities to the vicinity of Parliament Hill, I believe there may be value in having some direct involvement of Members of Parliament who may be interested in some of the courses and work which is carried out in the centre.
When public servants' jobs bring them in close contact with the Hill, they learn a great deal. I know that when the work of Members of Parliament brings them in closer contact with the Public Service, they generally are struck with the capacity and responsibility carried by people in the Public Service.
Part of the ongoing commitment to excellence of the centre should include some access for Members of Parliament who may be interested in learning more about the problems and prospects for Public Service management. Perhaps some special courses might be designed that would bring students in the centres and Members of Parliament together. Perhaps courses could be designed which might be directed specifically at Members of Parliament and take into account the difficulties they have with not being able to focus on these matters just prior to elections and so on. It could help them to learn a bit more about the current thinking of management in the Government of Canada.
The principal elect, Mr. Manion, has already indicated his priorities and preferences. In an article in Dialogue he spoke about what he calls a big campaign to decentralize, deregulate, deburden and debureaucratize. He suggests that the centre will be heading in that particular direction.
I believe a great deal of thought must be given to the question of how to combine accountability with effective management in a public sector environment. Much thought should be given to ways of increasing access to information about what happens within Government. Some of the hierar-chal management structures which have been traditional in the Public Service must be broken down. The idea that a department can only talk to the public or to elected Members of Parliament through the elected minister at the top of the department is an outdated one. The suspicion, which unfortunately exists between departments and both the public and elected representatives of the public in Parliament, is a barrier which must be broken down.
Public Service managers should understand that they can be more open and, in turn, should be given an assurance that they will not be squashed by a superior or a minister for being more open. That is an attitude which leads to the present patterns of
secrecy, lack of knowledge and lack of understanding about what happens within the Public Service.
Mr. Manion has also spoken about the desire to continue to encourage a corporate culture in the senior leadership of the Government of Canada. I do not think people could have many problems with that.
He has spoken about trying to build a fairly homogenized group of managers. That causes me some difficulty because it suggests that a general management cadre is capable of going into all areas of government. I am not sure whether that is still the case as it was perhaps 10 or 20 years ago. I suspect that the policy of moving people from one management position to another at the senior level may be too generous. At the same time we constrain too tightly the ability of people in the more junior levels of government to broaden their experience by moving from one department to another. That is increasingly difficult and people are stuck into one pattern of career growth.
For example, a student who happens to join the Department of Fisheries and Oceans may be stuck in that Department all his or her life, with almost no chance of moving out. There are only a couple of departments, such as the Department of Finance, which provide entrees for people to go into other areas. It has been suggested that the centre will work with a case study approach. I believe that approach, along with the desire to have more cases written up and available, is valuable.
I want to conclude with a couple of suggestions that I hope the centre, in its research function and its dealing with people in the backrooms of politics and elected representatives, will take into consideration. One concerns the problem the present Government faced but did not solve particularly well. Due to the increasing complexity of government, even if the number of employees is not larger, the way a new government provides direction to the Public Service in implementing the programs and policies of that government and party is very difficult. The present Government put in chiefs of staff and increased very substantially the money that used to be paid to executive assistants to ministers under the Liberals in the hope that it would give greater clout to ministers' offices in order to ensure that there was a more effective means of translating into action what ministers in the government want. 1 am not sure whether that has been wholly successful.
According to the American model, after the forthcoming election, some 3,000 or 4,000 senior positions will be replaced, affecting the top levels of major U.S. government departments. That is not a very good model. We should look for a model which would provide means by which there could be effective political direction without compromising the need for professional management while at the same time being responsive to government.
August 25, 1988

Both Mr. Manion and 1 have been involved with the question of political rights. It is quite obvious that the senior Public Service and senior departments have interests of their own and must be acknowledged as having almost a political presence in the Government of Canada. That is a problem which at least has to be identified and which calls for some solution.
Let me conclude by expressing on behalf of many very hardworking public servants their resentment and concern over a decision that has been made by the Government. There is an elitism that is taking place in the Government of Canada in the differing treatment between the management employees and the rank and file. It is expressed in the fact that the Government has decided to give pay increases of between 8 per cent and 12 per cent to senior managers, deputy ministers and so on in the Government of Canada at a time when it has pay standards for other employees in the order of 3.5 per cent to 4 per cent per annum.
1 do not think that helps morale at all. There is a real sense of unfairness and injustice among people living in my constituency and in the constituencies of the Hon. Member for Ottawa-Carleton (Mr. Turner) and the Hon. Member for Glengarry- Prescott-Russell (Mr. Boudria), people living in the capital region and elsewhere who are working for the Government of Canada because the Government decided to sock it to average civil servants at the same time it was giving raises of as much as $12,000, $13,000 or $15,000 to people earning over $100,000 in very senior management positions.
The Member for Ottawa-Carleton, who is going back to the private sector after this election, is about to leap to his feet to suggest that this is not very relevant. Perhaps it is not entirely in order with respect to this particular Bill, but I have been wanting to make this point for some time. I would hope as well that Mr. Manion, who I can see just behind him, would also be conscious of the fact that the perceived injustice is a very real one. After the tax bite is taken, those people working in average jobs in the Public Service are looking at a decline in their real incomes year after year, but the present Government has seen fit to give substantial increases to people in senior management categories. I think there is injustice and inequity there and I am sorry it occurs.
With those comments, I wish Mr. Manion well. If he wants me to lecture occasionally to his students at the centre, I will be happy to oblige. If he wants to offer some courses which would be available for Members of Parliament to participate in, and I am not in Government, I would be happy to try to take part.


Mrs. Claudy Mailly (Parliamentary Secretary to Minister of National Revenue):: Mr. Speaker, I do not think this is a time for political partisanship, and I am sorry to see that is indeed what is happening.
I am delighted to see this Bill tabled during my Government's mandate, because it comes as the culmination of the
Canadian Centre for Management Development Act
work done by many Members and by the D'Avignon Commission.
As was pointed out by the Hon. Member for Glengarry- Prescott-Russell (Mr.Boudria), the Hon. Member for Ottawa-Vanier (Mr. Gauthier) worked very hard for this happy ending. Another Member of this House also worked very hard toward the same goal, and I am referring to the late Walter Baker who, as a Member and later as Minister, showed a keen interest in the cause of professionalism and especially the merit principle in the Public Service.
We are very proud of the Public Service of Canada, which consists of men and women who daily demonstrate how professionals can and should behave in some very difficult situations where they must provide solutions that are both objective and helpful to a Government that is trying to solve some very complex problems.
I would like to take this opportunity on second reading to say that this morning, I met John Manion, the Director of the new Centre for which the enabling legislation was introduced today, and he gave me the assurance that contrary to rumors and also to certain representations that were made to me by public servants involved in this area, the Centre for Executive Development in Touraine, which was mentioned by the Parliamentary Secrertary in his speech, will not be closed. In fact, it will be a focal point in the centre for excellence we are creating officially today. Furthermore, Mr. Manion would like to see the Centre expanded to respond to the needs and expectations expressed in this Bill.
The public servants who made their representations and the journalists who said that the Centre would be closed, may rest assured that will not be the case. The Centre will continue to function. Its purpose has been confirmed, and I am delighted because it happens to be in my riding, and not just because it is physically present, but because, as you know, Mr. Speaker, we have trouble convincing certain people in politics that the Quebec side of the National Capital is an integral part of the National Capital. Later today, we will have the privilege of considering the NCC bill, which will once again confirm the bilingual and bi-cultural calling of our National Capital.
Again, I am delighted the Centre is in my riding and that, in its own way, it reflects the role played by the Quebec side in the National Capital region and in the work done by the Canadian Government in this country.


John Barry Turner: Mr. Speaker, I want to add a few comments as well during debate on this very important Bill. At this very moment there is a seminar taking place at the Chateau Laurier by the Public Policy Forum, an organization based here in Ottawa. It is focusing on the actual future management practices of the centre itself. The Deputy Secretary to the Cabinet, and designated principal of the future Centre, and, I should add, a constituent of mine, spoke there yesterday and outlined some of the priorities he would like to see the management centre pursue. I would like to just give some brief comments about what he said.

August 25, 1988
Canadian Centre for Management Development Act
I think he focused very briefly on the fact that the time has now come for the need to develop a set of programs and find the best people to administer them in the management centre. It is important to train our Public Service managers with new techniques and skills to allow them to deal with, as he said humorously yesterday, the "unexpected" which seems to be happening more and more frequently in our daily lives in dealing with public matters.
He talked about the importance of learning from other institutions, particularly those in the United States and the United Kingdom. Yesterday as well at the Centre, Dr. Loretta Flanders, who is the special assistant to the director of the Office of Executive Personnel Management, Office of Personnel Management, Government of the United States, focused on what she called a Framework for Management Excellence: The American Experience. The new centre in Canada will hope to benefit from these practices which have been going on in the United States and Great Britain over the last eight or ten years. One thing the centre can and should do is help managers relate more closely to the role of Members of Parliament, with enhanced reform in Parliament and a greater role for us to play in the legislative practice and creation of public policy.
Dealing with interest groups will be a very important aspect of the management training centre as well as the results of the impact of the Charter of Rights and Freedoms which we are now seeing as having wide repercussions throughout not only public, but private life. Indeed, one could add the aftermath of the introduction of the free trade agreement which will have significant impact on the operations of so many government Departments.
The centre will hopefully publish the results of its work and work very closely with private sector experiences in having seminars and bringing in researchers from the private sector to allow our public servant managers to benefit from the great amount of experience there is in the private sector. The need for this Bill is important. It is timely and will give the centre what has been called its intellectual independence. It will lead,
I hope, to a better management and therefore a much stronger Public Service of Canada. It will ultimately benefit all Canadians.

I am very proud to support the creation of the Canadian Centre for Management Development.

The Bill is timely. It is important. It will help our Public Service immensely to train our managers to be better managers, and we look forward to the passage of this Bill in all stages today.


Mr. David Daubney (Ottawa West):: Mr. Speaker, I will be very brief in my remarks in welcoming this initiative. I congratulate the Government on taking an initiative which is long overdue.
We have a good Public Service in Canada. It has been said for years that it is one of the best in the world. I certainly agree with that. I am proud to have been a member of the Public Service. I am proud to represent tens of thousands of public servants in the House of Commons of Canada. However, I recognize that there is a need for a management centre such as that which will be created in this Bill today.
I refer to some of the objects found in Clause 4 of the Bill, particularly subclause (a) which states:
"(a) to encourage pride and excellence in the management of the Public Service and to foster among its managers a sense of the purposes, values and traditions of the Public Service".
I have some sense as a former public servant and a resident of this community of those traditions. My great grandfather was a public servant in Ottawa. I have on my wall in my Parliament Hill office a framed copy of a certificate, certifying that he passed the civil service examination in 1883.
We have a long tradition of very fine individuals who have leadership roles in the Public Service of Canada. I refer to people such as Bob Bryce, Gordon Robertson, O. D. Skelton and Dr. John Deutsch, former inhabitants of my university at Queens in Kingston who were very much a part of the relationship between the university sector and the federal Public Service. This is an important initiative. It is very much in the tradition of that excellence.
I wish to be bold enough to make one recommendation, if I may, on the curriculum that might be considered in the many courses that will be offered at the management centre. I make it as a former officer of the Department of Justice, if I may suggest it to the principal designate, Jack Manion, who I wish well in his new duties. I refer to the importance of ensuring that Public Service managers are made aware of and have an opportunity to learn more about the legal process and the legal nature of decision-making in the federal Public Service. This is becoming a complex matter. It always really has been when one considers statutes such as the Financial Administration Act and the many onerous responsibilities that are placed upon Public Service managers under that Act, as well as under the Public Service Employment Act and so many others.
In light of the Charter of Rights and Freedoms and the increasing role of private Members of Parliament, for example, under parliamentary reform, it is important that Public Service managers focus on issues such as the legal aspects of the structure of government and the legal aspects of government operations in terms of the policy process, the program process, its administrative and, certainly, the financial control process.
August 25, 1988

The whole notion of law reform, institutional and procedural reform and constitutional reform are all matters that would prudently be the subject matter of courses at the management centre.
Having made that brief suggestion, may I once again congratulate the Government on this important and historic initiative. I wish all Public Service managers who will be enrolled from time to time at courses at the centre the very best.


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


Some Hon. Members:: Question.


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


Some Hon. Members:: Agreed.


Mr. Deputy Speaker:: I understand that there is unanimous consent to send this matter to the Committee of the Whole. Is it agreed?


Some Hon. Members:: Agreed.


Douglas Grinslade Lewis: Mr. Speaker, I am in the hands of my colleagues. We do have officials available to answer any questions that may come up during the Committee of the Whole proceedings. If my friends wish to have the officials brought in, fine; if not, we can proceed.


Michael Morris Cassidy: I prefer to let it go. I have made my comments.


Don Boudria: It is not necessary.


[Stage Direction]
Motion agreed to, Bill read the second time and, by unanimous consent, the House went into committee thereon, Mr. Danis in the chair.
Marcel Danis: Order. House in Committee of the Whole on Bill C-148, an Act to establish the Canadian Centre for Management Development and to amend certain Acts in consequence thereof.
Shall Clause 2 carry?


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


Marcel Danis: Shall Clause 3 carry?
On Clause 3-Establishment


Don Boudria: Mr. Chairman, I want to be very brief. 1 am wondering why the language in this clause is a little different than what we are accustomed to in terms of the phraseology such as "is hereby established". The conventional way of referring to that in Bills is "there shall be" or something to that effect. This seems to be just a modernized form of writing the Bill as opposed to the manner to which we are accustomed. Is there any significance in the fact that it is stated that way in
Canadian Centre for Management Development Act
Clause 3, and also in other clauses which I have noted, for instance, Clause 12?


Douglas Grinslade Lewis: Mr. Chairman, I wish to advise my friend, after consultation, that it is simply a matter of drafting. To the best of our knowledge there is no untoward reason why the words-


Don Boudria: I am not suggesting it is untoward.


Douglas Grinslade Lewis: "is hereby established" are used rather than "there shall be". I think it is completely in order and should stand as written.


Don Boudria: I just want to be assured that it has the same effect. Can the Minister confirm that?


Douglas Grinslade Lewis: It is my understanding that it has the same effect, yes.
Clause 3 agreed to.


Marcel Danis: Shall Clause 4 carry?


Some Hon. Members:: Agreed.
Clause 4 agreed to.


Marcel Danis: Shall Clause 5 carry?
On Clause 5-Powers


Don Boudria: I raise a point with respect to Clause 5(f). The Minister has given me an explanation informally. However, since I put my concern on the record at second reading, I was trying to identify the meaning of Clause 5(f) which deals with trade mark, copyright, and so on. I want to know whether it is the intention of the Government to centralize copyright which the Government owns in the centre. I am not necessarily against that. But I want to know whether that is what the Government intends to do, or does it merely intend to centralize copyrights and so on that the centre itself will develop under Clause 5(f)?


Douglas Grinslade Lewis: The latter part of my friend's comments are correct. It is intended that as the management centre progresses, if courses are produced and material is produced in connection with those courses, the management centre will have the right in some cases to sell those at cost and, in other cases, for example, in the case of libraries or other institutions where there is a working arrangement, to provide them free. The idea is to protect the copyright of the management centre to those particular materials.
Clause 5 agreed to.
Clauses 6 to 24 inclusive agreed to.


Marcel Danis: Shall Clause 25 carry?
On Clause 25-Deemed appointment

August 25, 1988
National Capital Act


Michael Morris Cassidy: Mr. Chairman, I am letting the clauses go through, but perhaps, since I made comments about the board, the Minister could say a word or two about the composition of the board, and particularly who the non-public servants are, since half the board are meant to be outsiders. This is probably not relevant to this particular clause, but it was a question which I had raised in debate on second reading.


Douglas Grinslade Lewis: Mr. Chairman, it is my understanding that with respect to the composition of the board, one-half would be from the private sector and one-half would be from universities and other learning institutions. 1 am sorry. Half the outsiders would be private sector people and the other half from institutions of higher learning.


Michael Morris Cassidy: Are there any women on the board and, if so, who are they? Madam Labelle presumably is on, but apart from her.


Douglas Grinslade Lewis: Mr. Chairman, my hon. friend will know that the Government has made great progress in increasing the number of women who are appointed to positions. It is the wish of the Prime Minister that wherever possible the representation of women on all boards and judicial levels, commissions, et cetera, be increased. My hon. friend will know that this increase has been from 15 per cent to 31 per cent during the past four years. I am sure that this intention, as evidenced by action, will continue in the course of the appointments to this board and commission.
Clause 25 agreed to.


Marcel Danis: Shall Clause 26 carry?
On Clause 26-Coming into force


Don Boudria: Mr. Chairman, I am just wondering if the Minister could tell us approximately what time schedule the Government has in mind for the coming into force of this particular Bill and what time schedule it has in mind for the actual opening of the facility.


Douglas Grinslade Lewis: Mr. Chairman, I am please to advise that the Government intends to move as quickly as possible to institute the management centre and the courses, and that the training centre will be in the new premises by the end of the calendar year.
Clause 26 agreed to.


Marcel Danis: Shall Clause 1 carry?
On Clause 1-Short title


Don Boudria: Mr. Chairman, given that we are discussing Clause 1, perhaps I should take the opportunity to do now what I should have done in my initial remarks, which I have intentionally made rather brief in order to have a fuller discussion at this stage. I merely wanted to add my own words of congratulations to Mr. Manion and those who will be chosen to be members of the board of the new centre, and I
want to extend to the centre, its staff, its board and, most of all, its students and participants my very best wishes.
Clause 1 agreed to.


[Stage Direction]
Title agreed to.
Bill reported, read the third time and passed.

Hon. Stewart Mclnnes (Minister of Public Works) moved: that Bill C-153, an Act to amend the National Capital Act, be read the second time and referred to a legislative committee.
He said: Mr. Speaker, this Bill allows the Government to carry through on a promise which was made during the Speech from the Throne on October 1.


Don Boudria: Must you put it that way?


Stewart Donald McInnes: Thank you, Hon. Member. We are trying to crystalize and focus our attention more formally on activities carried out by the NCC, which indeed have been part of their unofficial mandate for a long period of time. Perhaps the mandate as expressed in the Bill, in the legislation now existing, is too restrictive, too concerned with bricks and mortar. We want to amplify and embellish and expand the powers of the NCC to undertake the promotion, as it has done so very well during the past number of years, with respect to giving more focus and new direction on Ottawa and the National Capital Region, as Canada's meeting place, to ensure that it communicates Canada to Canadians and to safeguard and preserve the capital. So the amendments are of a very simple nature and they are necessary for the efficient functioning of the NCC.
There are several proposals with respect to land use changes, demolitions, and land sales, and to give it authority concerning these particular matters it will prevent the demolition of heritage buildings, the inappropriate use of federal lands and will better provide tools to realize the principles of the federal land use plan to the benefit of both the NCR and the longterm interest of all Canadians.
With the passage of this legislation, this Government will be seen as being the first Government to live up to its commitment of strengthening the symbolic significance of the capital.


Don Boudria: Yes. Sure.


An Hon. Member:: When are we going to become a province?


Stewart Donald McInnes: I suggest that this Bill will enable the NCC
to improve its co-operation with other levels of government in
the capital, by providing quick responses to the giving of
August 25, 1988

easements and co-ordinating the effort with respect to all matters involving land owned by the Government in the NCR.
I want to thank Members, in anticipation of their positions today, who have been very co-operative in allowing us to advance this Bill which 1 think is in the national interest.


Don Boudria: Mr. Speaker, the first thing that 1 would like to do today is to offer my words of congratulations to the Minister, who became a father only a few days ago. I am sure that I speak on behalf of all of my colleagues in offering the Minister and Mrs. Mclnnes my very best words of congratulations, which I sent to him in writing a few days ago.
I should correct the Minister when he refers to Bill C-153 and his Government being the first Government to improve the symbolic significance of the National Capital Region. Far be it from me to try to correct the Minister, but let me try anyway to remind the Minister that in 1899 the federal Government created the Ottawa Improvement Commission. In 1913, the then Borden Government established the Federal Plan Commission. In 1927, the Government established the Federal District Commission. In 1945, under the Federal District Commission Act, Mr. Greber, the noted French planner, was appointed to prepare the Greber Plan. In 1949, the first Master Plan of the National Capital Region was commissioned in the House of Commons. In 1951 that plan was tabled in Parliament. In 1956, a joint parliamentary committee endorsed the continued implementation of the plan. In 1969 the First Ministers endorsed the Greber plan as a vision for a unified capital, extending it across both sides of the Ottawa River.
Do you know where I got that information, Mr. Speaker?


John Barry Turner: From the NCC.


Don Boudria: From the Minister's briefing notes that were supplied to us.


Some Hon. Members:: Oh, oh!


Don Boudria: I know the Minister has come back from his constituency lately for obvious reasons, but I remind him that he has perhaps overstated somewhat the involvement of his Government in terms of the National Capital Region.
I have here a copy of the National Capital Region report which was the work of a committee of this House for two years, which report was tabled in this House in 1976. The Minister and his Government certainly have not re-invented the wheel in terms of commitment to the National Capital Region. Indeed, there have been 85 years of planning, according to the Minister's own briefing notes, in the National Capital Region by the National Capital Commission and predecessor organizations. That is some of the history of the National Capital Commission and the development of that Commission and its predecessors in the development of our area.
National Capital Act
I am sure that I speak on behalf of all Members of the House when I say that through the organization we now know of as the NCC this city is far more beautiful than it otherwise would have been. The National Capital Commission is upon occasion everyone's favorite whipping boy, including mine when it does something that I dislike. I usually raise the matter when I dislike what it does, but I also raise matters publicly when I like what it does. Sometimes the subjects are controversial. I remember last year the National Capital Commission came up with the idea that we should have coloured pavement in front of Parliament and other buildings such as exists in Boston and in London, England in front of Buckingham Palace. That red pavement was not particularly well liked by some Government back-benchers and they convinced the Deputy Prime Minister (Mr. Mazankowski) to kibosh to the plan.


John Barry Turner: Which one?


Don Boudria: The same Deputy Prime Minister we have now.


John Barry Turner: Which back-benchers?


Don Boudria: I could name them individually if the Member wants me to but I will avoid that embarrassment for the Hon. Member for Ottawa-Carleton (Mr. Turner) who like myself liked the idea proposed at that time by the National Capital Commission. I said on the floor of this House that I thought the plan should proceed. I still think it should proceed because I think it is a good idea. 1 say to the Member from Winnipeg-undoubtedly he has travelled and seen that kind of decoration in front of other legislative buildings and in other downtown areas-it is a good idea into which a lot of thought went but that plan was scuttled.
On behalf of my Party, I want to speak in favour of the Bill. There are a few questions I will want to ask in Committee of the Whole. I hope the Minister will have the officials available to us to answer questions, particularly as to the authority the NCC will have over private lands under the Bill. I am particularly concerned about that because in no way do I want to interfere with the powers that municipalities have at the present time.
I for one am pleased that we are recognizing in statute what the NCC is doing already in terms of its role in the programming area. I think of Winterlude, the very successful winter carnival that we have in Ottawa, which 1 believe is now the second-largest winter carnival in the country. That is a tremendous endeavour. Our Canada Day celebrations are something of which all Canadians are proud. Tourists come here not only from our country but from around the world and have remarked about the marvellous job done in organizing the Canada Day celebrations. Those celebrations are in part the responsibility of the Secretary of State (Mr. Bouchard), but the NCC, of course, plays a leading role in the organization of the activities.

August 25, 1988
National Capital Act
The NCC has also provided such things as bicycle paths and set up skating on the canal, et cetera. 1 want to take this occasion to say that I hope the winter and summer outdoor activities continue to be offered on a no-charge basis in the National Capital Region, whether for local people or for people coming from the Minister's riding in Halifax. The last thing people want to be doing after paying considerable money to travel to our capital is to go through a toll booth on the Rideau Canal. I hope that never happens, but it is an idea brought to our attention.
1 congratulate the Chairman of the National Capital Commission. She brings a lot of thought provoking ideas to us, some of which I disagree with but the majority 1 do agree with. It does not matter that 1 disagree with them from time to time. The Chairman is thought-provoking in that she brings forth matters for public discussion and has the fortitude to do so. That is good in its own way because it causes us to pause and reflect on various ideas.
The Government in the Throne Speech of September, 1986, said it would bring this Bill forward. We are glad to see, nearly two years later, that the Government has done so. On behalf of my Party, as the Official Opposition spokesman, I agreed that the Bill should proceed forthwith.
1 want to take a few moments though to discuss something about the National Capital Commission that involves my constituency and invite the Minister in that regard to pay very close attention. I think that the boundaries of the National Capital Commission are not appropriately divided right now and 1 am looking for the Minister's co-operation. Presently the National Capital designated region under the schedule of the Act extends some 70 or 80 kilometres westward from the Parliament Buildings, which I believe is the focus of the whole area. Conversely, if you were to go in an easterly direction toward my constituency, the National Capital Region extends only some 20 or 25 kilometres. 1 do not feel that is appropriate. Land, particularly the islands on the Ottawa River east of Cumberland, and land in the area of Rockland, Clarence and Plantaganet should be protected. There is no better tool as far as I am concerned than the National Capital Commission to preserve and protect those lands east of the city in a manner consistent with the protection given on the western side of the city.
I have suggested to the National Capital Commission that that should be done. The Minister is probably aware that I have raised this publicly as something I would support. I wish I could take credit for the idea myself, Mr. Speaker, but it is not mine. The idea was brought to my attention by the Mayor of Rockland, His Worship Jean-Marc Lalonde, who suggested extending the National Capital Region eastward.
We are presently having meetings. I thank the Minister and the Chairman of the National Capital Commission for providing the staff to brief the local mayors on the advantages of having the area designated in terms of the National Capital Region, and we are having meetings with the other local
mayors in the vicinity to obtain their concurrence for this kind of initiative. With this concurrence, which I hope will come shortly, 1 would then like to propose a Private Member's Bill to this House to change the boundaries of the National Capital Region. 1 hope the Government will give the same kind of cooperation to that as we are giving today to the Government's own Bill.
I want to speak to a few items in the Bill. 1 agree with the part of the Bill that suggests the head office of the National Capital Commission could be located in an area other than Ottawa. All parts of the national capital district should be treated equally, whether those parts are Gatineau, Hull, Orleans or Carp. They are all equal parts of the national capital area, and if the NCC wants to have an office located in one part rather than the other, that should be permitted. In all likelihood, the head office will remain where it is now. Nevertheless, the whole district should be treated in an equal and consistent manner. 1 congratulate the Government for putting that particular provision in the Bill.
Under this Bill, the NCC will now have the power to get into the area of programming, in which it was already involved. I want to make it clear that we should in no way send the NCC a message that we want it to move away from dealing with bricks and mortar because there is much of that to be done yet. The parkway system is not complete. There is work to be done in the field of bricks and mortar which the NCC has traditionally done and which should be continued.
Of course, the NCC will be doing other things such as programming, but I hope we get the Minister's assurance that those two things will continue in tandem as opposed to having one cancelled in favour of the other. I am confident that that is not what the NCC or the Minister wants to do, but I think it should be restated.
With these few remarks, I will end my debate on second reading. I hope we will have some time for a discussion of the different clauses of the Bill at Committee of the Whole stage which I understand we will agree unanimously to go to later, and if we do extend past one o'clock, I hope that we could not see the clock in order to assist all Members, particularly Members from the national capital area in discussing the Bill in a thorough manner. We all want to have it passed today, but we do not want to curtail debate in any way.
Again, 1 indicate the support of my colleagues for this Bill and for the continuing good operation of a National Capital Commission.


Michael Morris Cassidy: Mr. Speaker, I will support this Bill and my Party supports it. As a Member from the National Capital Region, 1 support the Bill because its major purpose is to put into legislation in the National Capital Act effectively what the National Capital Commission has been doing increasingly over the past few years. Rather than
August 25, 1988

dealing just with hard services and with putting into place parkways and beautifying the National Capital Region, the NCC is increasingly promoting various kinds of public activities and events which are worthy of a national capital and which enable Canadians from this area and from across Canada to sense a celebration of a country when they are here in the national capital or when they see events in the national capital via the media.
The existing Section 10 of the National Capital Act provides that most of the powers that are given to the Commission are related to the physical appearance of the National Capital Region. According to that section, the Commission has the power to acquire and administer property, to lease or dispose of property, to build parks and squares, highways and parkways, bridges and buildings and other works, to improve its own property or other property managed by government departments, to co-operate with local municipalities or authorities to improve or develop or to maintain property and to construct places of entertainment, amusement, recreation or refreshment upon property owned by the Commission. It is all related to property.
1 have been a resident of the Ottawa area for some 22 years, and I know there is no question that the National Capital Commission has done an excellent job in implementing the dream of various planners, including the dream of the Greber Commission which was held just after the war and has given us the parkways along the canal. It has opened up the canal in the downtown core between Sandy Hill and Centretown where there used to be train traffic to the Union Station. It has given us the parkways along the Ottawa River and now the new parkway out toward the aviation museum. It has given us the development of the Gatineau and the rest of it. However, a country is people and a capital is about people. That is why the National Capital Commission's efforts have been redirected.
There has been a slowing down of the emphasis on the physical appearance of the national capital and from time to time, the Commission has been putting extra pressure on the local municipalities, suggesting that they should not expect to get all parks and recreation projects developed for them by the National Capital Commission. Sometimes the NCC acted a bit like a sugar daddy to local municipalities, and having once been an alderman in the City of Ottawa, I feel that that is a perfectly natural reaction. Sometimes the NCC is forced to say no.
The Bill proposes that the objects and purposes of the Commission be expanded to allow the Commission to organize or to sponsor or to promote public activities in events in the National Capital Region that will enrich the cultural and social fabric of Canada, taking into account the federal and bilingual character of Canada and the heritage of the people of Canada. That sounds like some of the language that touches all bases in the Constitution of Canada, but I suppose that also reflects the nature of the country.
National Capital Act
There is also a new power of co-ordination for the Commission. That is an important power. However, the drafting of this is confusing, to put it mildly. I would challenge the Minister to explain what it actually means once it gets past the word "coordinate".
The NCC is being given the power to co-ordinate the policies and the programs of the Government of Canada respecting the organization, sponsorship or promotion by departments of public activities and events related to the National Capital Region. If the National Gallery, in its wonderful new premises, proposes to put on a blockbuster exhibition next summer, that presumably would be an activity or event, but would it be related to the National Capital Region. Would the NCC have the right to co-ordinate that particular program or not? I do not know. I will not move an amendment to the clause because I am prepared to take this on faith. I think its major purpose is to put into legislation enough power so that the NCC can do what it has been doing, such things as co-ordinating the Destination '88 tourism program, pulling together the two regional municipalities, the private sector and the tourist industry in order to make the region an increasingly important place for Canadians and for foreigners to put on their itineraries when they decide to travel to this part of the country.
As I have wandered through restaurants and public squares within my constituency of Ottawa Centre this summer, I have found that there is no question of the increasing interest this capital holds for tourists, including many tourists from the United States. I believe that Ottawa is an undiscovered treasure for many Canadians and certainly for many foreigners. They really like our city, and one of the reasons they like our city is because of its appearance. Another is because of the extraordinary variety of activities that take place.
We have come to the middle of August, and some of my friends are saying that they are almost festivalled out by now because of the number of festivals and public events which have taken place. There have been drummers, the Franco-Ontarian Festival, rock concerts, the jazz festival, the buskers festival and the multicultural festival. Those have been good events. We residents of Ottawa have learned and our visitors learn to be constantly surprised because there will be dancers, musicians and street performers and wonderful events taking place in many parts of the capital. There was opera in the Arts Centre again this summer after a long interval, and I would point out to the Minister that it was extremely popular to the point where it was almost impossible to get a ticket because there were not very many performances.
1 think the Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) may have left us, but since the Minister has had a child recently, perhaps he would join with me in wishing a happy anniversary to the Hon. Member for Glengarry- Prescott Russell. I understand he intends to take his wife out to dinner, perhaps to reintroduce himself to her, this evening rather than be here for the debate.

August 25, 1988
National Capital Act


Stewart Donald McInnes: Are we invited?


Michael Morris Cassidy: I am not sure about that.
The Bill also gives the NCC a certain flexibility in entering into easements, and more authority with respect to proposals for demolition of or major changes to Government of Canada buildings. That is, any buildings in the National Capital Region. The reason is because of the scandalous activity by the Mint which pushed ahead with its proposals. In fact, half the Mint was torn down before anyone was able to stop it and ensure there was more serious consideration of the heritage value of that building. The NCC was caught short because of a weakness in its powers.
I want to talk more generally for a minute about the National Capital Commission. I have not had this chance before and I want to suggest, among other things, to all of my colleagues, particularly those from the National Capital Region, that the NCC has now produced both a plan and what is called a capital orientation plan. That is a discussion of the activities to take place and the kind of soft services they intend to offer in helping to make the region into a national symbol. I hope that in the fall, particularly if there is a new Parliament at that time, that the standing committee could take that plan and hold some hearings in order to give the NCC a chance to defend what it proposes and give local Members of Parliament and other interested parties a chance to comment on what the NCC is doing.
There are changes taking place within the Commission. They are generally positive, although they still have a fair way to go. That is one reason why I think we need some of that dialogue somewhere here, not just a half hour or two or three hour presentation by the Chairman of the NCC on its estimates which takes place once a year.
I think the weakness in the capital orientation plan and the weakness in the NCC as a whole, and the weakness in this Bill if you will, is that the emphasis on the NCC having a national mandate ignores the fact that it exercises a mandate in the National Capital Region. It does so by providing services and so on for people in this region. It is important that the NCC understand that, and I do not believe it does adequately understand it now.
I have proposed on a number of occasions, both in meetings with Mrs. Pigott and also in hearings of the committee when we were considering the NCC's estimates, that there should be an advisory committee to the Commission made up of representatives from the region itself; people from the municipalities, people from community associations and the general public, people from ethnocultural organizations, women's groups, groups representing poor people, the Labour Council, the Board of Trade, people from cultural, sporting and artistic groups. That kind of parliament of the NCC would only be advisory. It would not have the power to make decisions. I do
not question the fact that the NCC has a national responsibility and mandate. However, having four or five local representatives on the 20 person board is not good enough to ensure that local concerns are adequately reflected. It is better now than it was two years ago, but even today the NCC tends to operate like a black box in its consultation and communication with people in this area who, after all, are the ones most affected by its decisions.
I say black box in the sense that there is input and later on something may or may not happen. It is argued that local Members of Parliament can perhaps substitute a bit, but I was not elected to be an alderman for the NCC even though I have had to play that role from time to time. I think if you were to have an advisory committee it might make sense to make local Members of Parliament ex officio members so that if something came up like the pink pavement, for example, which I opposed and which the Hon. Member for Glengarry- Prescott-Russell supported, it could be discussed with the local advisory committee to see whether it was defensible or not.
This group should be a sounding board that would meet at regular intervals, maybe every couple of months, with the chairman and perhaps senior staff, and perhaps a couple of times a year with the board. That does not mean they would have to sit in on every board meeting, but at least they would have the opportunity to raise concerns and perhaps sensitize people on the board, who come from across Canada, to some of the concerns and ideas of people in the region.
I have been suggesting for years that the wonderful bicycle network which allows visitors to and residents of Ottawa-Hull to travel around the region needs to be completed toward the foot of the locks just below Parliament Hill. You could then go from west Ottawa all the way through to the aviation museum virtually without having to cross a road. That is an idea that goes into the black box and then just sits there and nothing happens. There needs to be a vehicle by which ideas like that from the local area can be responded to by the NCC better than just having a two hour session in the committee and letters and correspondence, or meetings with the chairman.
Given the desire of the NCC to really change things a bit, the ideas which, according to the new plan, say that the capital will be Canada's meeting place, bringing Canadians together through the democratic process, surely some greater input locally would be a great idea, not just a better public consultation process. The NCC has learned from the Mile Circle fiasco and some other problems it had early in 1985, that something more than that is needed.
The second purpose of the new mandate is to communicate Canada to Canadians with the capital demonstrating those principles which are common to all Canadians. There, too, some form of consultation is required, and I am suggesting a vehicle which I think would be a way of opening up the NCC. It would also safeguard and preserve those national treasures which are unique in their influence on all Canadians. Even
August 25, 1988

there I think local people who know this area can have valuable input into safeguarding those national treasures.


Claudy Mailly: Point of order, Mr. Speaker. I see it is now one o'clock and 1 would like us to agree to not see the clock so we can have a chance to say a few short words on this Bill.


The Acting Speaker (Mr. Reid):: Is that agreed?


Some Hon. Members:: Agreed.


Michael Morris Cassidy: Mr. Speaker, I have to leave because I have a lunch date with the Chairman of the Canadian Ethnocultural Council which unfortunately I had to delay because of this debate. However, if Hon. Members wish to go on after that to committee stage, or take a bit of time out of the tax Bill and do it at three o'clock, I and my Party are open to whatever is most convenient to Members. I chose to make my comments on second reading and I do not have any specific comments to make at committee stage except to say to the Minister that I really do not think the new Section 10(2) is particularly well drafted. I make that point for the record.
I want to conclude by saying that it is time the Minister stepped in and stopped the secretiveness of the board of the NCC. Certain decisions made by the Commission which touch on personnel should probably be kept in camera. However, for the rest, the efforts which the The Ottawa Citizen and my friend, Ken Rubin, have been making for years, to have the minutes of the board made public and to provide greater public access to what the commission is doing, seem to me to be entirely well taken. We need to democratize, to open up, and to assure vehicles of communication for the National Capital Commission with people from this area where its services are carried out. That is the point I wanted to make in this particular debate in supporting this Bill.
I know from the record that the National Capital Act is amended every year or two. It is not as though the Bill is closed for eternity, or even for the next 10 years. I hope that we might have some discussion, after the election, of this discussion paper on Canada's capital and the capital orientation plan and that after such discussion we could, among other things, establish the kind of local consultative mechanism which Mrs. Pigott has unfortunately rejected and which the Government has, unfortunately, been unreceptive to in the past.
In conclusion, two years ago I sent a questionnaire to 75 organizations including municipalities, community organizations, ethnic associations, and aldermen asking for feedback on that proposal. I got 29 responses and all but four of those responses were positive. There is, therefore, general support for that in the region. I know we can work something out that does not challenge the national mandate of the NCC but ensures that it is carried out more responsibly and more sensitively for those of us who live here in the National Capital Region.
National Capital Act


Claudy Mailly: Mr. Speaker, I am particularly pleased with Clause 2 of the Bill. This clause repeals Section 5 of the Act that created the National Capital Commission and reads as follows:
"5. (1) The head office of the Commission shall be in the National Capital
Region.
(2) The Commission shall meet at least three times a year in the National
Capital Region."
That may seem very simple, Mr. Speaker, but when you see what it replaces, you realize how big this change is. Previously, the Act said: "The Commission shall meet at least three times a year in the city of Ottawa, and it may meet at such other times in the National Capital Region as the Commission deems necessary."
So, Mr. Speaker, here in this Bill, we officially confirm that the National Capital Region is not just the City of Ottawa. This is a very important point, because, Mr. Speaker, the 1867 Statute which made Ottawa the capital of Canada simply mentioned Ottawa, which in 1867 meant about a dozen streets on the Ontario side of the capital.
This statute was not amended. I myself tried to present a Private Member's Bill to say that the seat of the Government of Canada is the National Capital Region, in order to confirm the fact that our capital is on both sides of the Ottawa River and naturally takes in the Quebec part. Unfortunately, or fortunately, I was made a Parliamentary Secretary and I could not pursue this Bill.
So the Bill before us goes in the same direction. Just now, my colleague from Glengarry-Prescott-Russell	(Mr. Boudria) objected that the Minister said it was the first time that a Government confirmed the symbolic role of the NCC. But the Minister was absolutely right. It is the first time that the NCC's symbolic role on both sides of the Ottawa River has been confirmed; it confirms for the first time that the capital is not only Ottawa, a few streets in Ottawa, but the region, which includes the Quebec side.

What we are talking about here is nation building, as our very beloved Prime Minister (Mr. Mulroney) often says. We have an anglophone Minister from Nova Scotia and a chairman of the Commission, who is an anglophone from the Ontario side of our capital, who have understood the aspirations of French-speaking people and how important this is, not only symbolically, that this is enshrined in law that the capital of our country is in the region which covers both sides of the Ottawa River, including the Quebec side where the majority of the people are French speaking. They will now know that the NCC has officially recognized that our capital is a bilingual and bicultural capital just as is our country. To me this is a very great day because this has been accomplished after years of effort and is accomplished under our administration.

August 25, 1988
National Capital Act


David Bruce Daubney: Mr. Speaker, I will just take a minute, because I know that time is precious and we are overtime, to say that I support the Bill and support much of the commentary which has been made so far today. Those of us who represent this area are fortunate to live in a very special part of Canada. That is made all the more special by the presence and activities of the National Capital Commission and its predecessors over the years. The Bill improves and, as the Minister indicated, recognizes the nature of the expanded duties which the Commission has taken on over the years and has given them statutory authority. I welcome that.
I would like to say a word about consultation as well. I think there has been a significant improvement in the consultative process which has taken place between the Commission, local MPs, and the population of the National Capital Region. I applaud that but emphasize again the need to do more than has been done to date. It is very important, given the impact and the role of the NCC in the National Capital Region, that there be processes put in place which will ensure that there is adequate consultation and discussion with the local municipalities and residents in this region to ensure that activities and proposed activities of the NCC, particularly as they relate to changes in the use of public lands, be full, complete, and frank.
I would like to comment upon the remarks of my friend from Gatineau. I support the Bill and, as 1 said, I support the clause which recognizes that meetings of the Commission and the offices of the Commission can be located anywhere in the National Capital Region. I think that is sensible. It is logical given the fact that the National Capital Region includes not only the City of Ottawa but municipalities on the Ontario and Quebec sides of the Ottawa River. However, I do think that that is a different matter than saying that the capital of Canada is not Ottawa.
I am the only government Member who represents a riding entirely in the City of Ottawa and Ottawa is the capital of Canada. The clause in the Bill dealing with the location of the headquarters is supportable, as I have said, given the purpose and objects of the Bill and of the National Capital Commission. However, that does not go so far, I would suggest, as to say that we should take from that any notion that the Government of Canada is suggesting that the capital is not the City of Ottawa.


John Barry Turner: Mr. Speaker, I rise on a point of order. Is my understanding correct that we are going to complete this Bill in all stages today correct?


The Acting Speaker (Mr. Reid):: Is it the understanding of the House that we will complete this Bill in all stages before we see the clock?


Some Hon. Members:: Agreed.


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


Some Hon. Members:: Question.
Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, Bill read the second time and, by unanimous consent, the House went into committee thereon, Mr. Reid in the Chair.
Joseph Lloyd Reid: Order. House in Committee of the Whole on Bill C-153, an Act to amend the National Capital Act.
Shall Clause 1 carry?


Some Hon. Members:: Agreed.
Clause 1 agreed to.


Joseph Lloyd Reid: Shall Clause 2 carry?
On Clause 2-


John Barry Turner: Mr. Speaker, in spite of what has been said already today with respect to this Bill, which I support entirely in principle, I have concerns about Clause 2. I wish to propose an amendment, of which I gave notice to the Chair as well as the Minister. I move:
"That Bill C-153, an Act to amend the National Capital Act, be amended in Clause 2, Section 5(1) by deleting the word "Region"."
The Bill proposes to change the requirement that the head office of the Commission be in the City of Ottawa and the Commission meetings be held in the City of Ottawa. It is suggested that the substitution of the words "City of Ottawa" by the words National Capital Region would correct an inconsistency.
I do not question where the Commission might wish to meet, but I do question the issue of inconsistency. 1 do not believe it is inconsistent at all that one would suggest that the headquarters be located in the national capital, namely the City of Ottawa.
I want to underline the fact that the location of the headquarters has nothing to do with the mandate of the National Capital Commission. In fact, the Government has approved what has been called an enhanced mandate of the National Capital Commission, which deals with safeguarding and preserving the capital. It does not deal with safeguarding and preserving the National Capital Region.
1 do not believe that the NCC can safeguard and preserve the capital from a headquarters outside of the capital. 1 stress the word "capital" because the capital of Canada is the City of Ottawa. I personally believe that the NCC headquarters should be located in the national capital.
1 want to make it clear to all Members that 1 am not questioning the mandate of the NCC to enhance the National Capital Region and do its work within the region on both sides of the river. That is not my point. In fact, I can substantiate that quite clearly by a motion that I put before the House on December 16, 1987, that deals with designating Confederation Boulevard that will run between Hull, the Outaouais and Ottawa on the Ottawa side. I am not questioning the mandate at all. My concern is the location of the headquarters.
August 25, 1988

With respect to Confederation Boulevard, that motion was unanimously supported by the City of Ottawa Council. I am waiting for and hoping that the City of Hull Council will also support that motion unanimously. I have asked the House to endorse it afterward.
By virtue of its name. National Capital Commission, I strongly believe that the headquarters of that agency should be within the national capital only. My amendment would remove the word "region", which would then indicate that the headquarters would be in the national capital. I ask Members of the House to support the amendment.


Don Boudria: Mr. Speaker, unfortunately I have to disagree with that suggestion. In fact, the Hon. Member is suggesting that Clause 2, proposed by the Government, should be deleted. His amendment would have that same effect.
If we were to remove the word "region", we are left with national capital, hence the City of Ottawa. I have here the original Act, which says that the head office of the Commission shall be in the City of Ottawa. The Member is asking us to delete Clause 2 of the Bill.
It is quite clear that Ottawa is the capital of Canada, not the National Capital Region. We are not disputing that. We are saying that the National Capital Commission has a mandate to act in a territory from Cumberland, Ontario, to just short of Arnprior; from Buckingham, Quebec, to a city west of Hull, near Quyon. That is the territory of the National Capital Commission. Surely, the office of that Commission should be some place within that territory, but not restricted to one specific spot within the territory. That is what the Government is trying to do, and I support it.


Claudy Mailly: Mr. Chairman, I have to agree with the Hon. Member for Glengarry-Prescott-Russell.
I just indicated in my speech on second reading that I rejoiced in this wonderful symbolic gesture that was being made in the Bill because it would state precisely that the NCC would look after the total territory it is supposed to represent. The fact that the Bill states it can have its headquarters anywhere in that territory recognizes that it will intervene on the whole territory.
I do not understand why my colleague would feel threatened by the fact that we are finally putting into law what the National Capital Commission has been doing since it was created in the late 1960s. It is looking after the whole territory of the National Capital Region.
I find it very sad that my colleague feels threatened by this. I mentioned that we were talking about nation-building. Surely he is not fearful of building a strong and united nation.


Stewart Donald McInnes: Mr. Chairman, for the reasons stated by the last two Members who spoke, I also oppose the amendment.
National Capital Act


David Bruce Daubney: Mr. Chairman, I believe I made my thinking clear in my remarks at second reading. I cannot agree with the amendment.
We have all agreed that the City of Ottawa is the capital of Canada. However, it seems to me illogical to suggest that in a Bill dealing with the National Capital Region, the National Capital Commission cannot meet and cannot have offices located anywhere in the National Capital Region. I remind the Hon. Member for Ottawa-Carleton that it is not as though we are creating a precedent with head offices of federal institutions being created outside the City of Ottawa. Last week, I believe, a Bill was passed in this place dealing with a new human rights institute, the head office of which will be in the City of Montreal. I believe there is an institute in Halifax, in the riding of the Hon. Minister of Public Works. There are other examples.
I do not view this in any way as a dangerous precedent. I believe it is just a logical step to have the head office located anywhere in the National Capital Region.
Having said that, in light of my discussions with the commission, 1 suspect that the head office will continue to remain in the downtown Ottawa area.


@Acting Chair(man)? of Committees of the Whole: Is the House ready for the question?


Some Hon. Members:: Question.


Joseph Lloyd Reid: Shall the amendment carry?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.
Amendment (Mr. Turner (Ottawa-Carleton)) negatived: Yeas 2; nays 9.


Joseph Lloyd Reid: 1 declare the amendment lost.
Shall Clause 2 carry?


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


Joseph Lloyd Reid: Shall Clause 3 carry?
On Clause 3-Objects and purposes of Commission


Don Boudria: Mr. Chairman, I am looking here for reassurance from the Minister with respect to something I stated in my remarks at second reading with respect to the National Capital Commission's role in organizing and co-ordinating and promoting programs in the National Capital Region. We know, of course, it has been doing some of this in the past very successfully, and we encourage it to continue.

August 25, 1988
National Capital Act
I do, however, want to make two things clear and, hopefully, the Minister can clarify them. First, we are not giving a brand new role and mandate to undertake a whole series of programs totally different than what we are doing now and, second, the traditional role of the National Capital Commission, the bricks and mortar role, referred to in that way by the Minister, will in fact continue.


Stewart Donald McInnes: 1 can give the Member the assurance requested.
Clause 3 agreed to.


Joseph Lloyd Reid: Shall Clause 4 carry?
On Clause 4-Coordination of Development.


Don Boudria: Mr. Chairman, I am looking for clarification here from the Minister on the role of the NCC under the proposed amendment to Clause 4. i believe I raised this as well in my second reading remarks and, hopefully, the officials of the National Capital Commission can advise the Minister in terms of obtaining a response.
The original Act, and I have a copy before me, gives a mandate to the National Capital Commission to develop and co-ordinate the development of public lands in the National Capital Region. That is fine. It gives a role to the NCC as well to review the proposals for the location, erection, alteration or extension of buildings and so on on public lands in the National Capital Region. If we look at the amendment before us, we see it refers to public lands in certain areas but also refers to private lands where the private land is leased by the federal Government, as I understand it.
I am just asking why the NCC wants that particular role of having an ability to in fact overview changes in private lands. I say to the Minister that I personally do not know if it is constitutionally possible because, of course, the role belongs to the provinces and we have property and civil rights in our Constitution. I am not sure the NCC could do that even it wanted to and even if this Bill were passed. I am asking the Minister, perhaps, to explain to the Committee of the Whole why in fact the NCC is looking for that and what purpose it will serve and, in fact, whether it has ascertained it has the authority to do that in any case.


Stewart Donald McInnes: In reply to the Hon. Member, this is a planning function that is envisaged by this particular section. If a federal department leases land from the private sector and wishes to put up a building, then it seems appropriate that the NCC should have some co-ordinating power or be in a position to control that particular development. What we are concerned with is utilization of lands by any federal Department, whether they are owned by the federal Government or the private sector.


Don Boudria: I think we need a further explanation on this. I want to know what happens in a case where the Government leases a building from the private sector. I will use the example
of a building, say in downtown Ottawa. The Government may in fact lease the usage of office space within the building. Is it envisaged that in those cases the Government would in fact have authority over the exterior of that building when it is leased by the Government? If the Government leases the land and builds its own building, well, fair game. That I accept. But I want to make sure what the legislation is intending to do in the case of the Government leasing a building as opposed to leasing the land to construct its own building.
I want to make sure that we do not interfere with the provincial powers in this case, which are usually conferred to the municipality under, for instance, in my Province of Ontario, the Planning Act. The municipalities have the privileges of zoning, and so on, and they are given that power by the provincial government. It worries me that that was not in the original Act and this amendment in fact confers a power there that could lead us into problems if it says what I think it does. I hope the Minister can provide the reassurance I am looking for.


Stewart Donald McInnes: Section 11(1) says where any department proposes to erect, alter, extend or demolish a building. We are dealing with Departments of Government, not what the private sector would do. 1 would suggest the fears of the Hon. Member, perhaps, are unfounded, with respect.
Clause 4 agreed to.
Clauses 5 and 6 agreed to.


Joseph Lloyd Reid: Shall the title carry?


Don Boudria: Mr. Chairman, before we adopt the Bill in its final stage, we are dealing with the title, which is usually a general clause which permits general kinds of questions, and I will take a minute to just do that. I am not attempting to delay the Bill. I am sure we both would like to have a few minutes for lunch prior to Question Period. With respect to the potential of changing the territory of the National Capital Commission in the future, I think the Minister will know, although, for understandable reasons he has been absent around Parliament Hill for a while lately, that I have proposed, or actually the mayor of one of the communities in my riding which is not presently designated by the NCC, has proposed that the territory be extended eastward from the City of Ottawa in a manner which is consistent with the distance west of the city.
The Minister will know that west of the city, the NCC territory extends some 40 or 50 miles. East of the city, it is only a very short distance and barely goes beyond the Green-belt. A number of municipalities are interested in extending that territory. I am presently having consultations with them, together with the NCC, which has kindly offered to assist the municipalities in providing briefings and so on.
August 25, 1988

There is an interest simply because there are islands on the Ottawa River that merit protection. That is true, I think on the side of the river I represent and well as the other side of the river which is represented by the Hon. Member for Gatineau. There are islands east of Masson, between Masson and Papineauville. There is a territory beside the Ottawa River which would warrant protection further eastward on both sides of the Ottawa River, that is on the south side which I represent, and, presumably, the same-although I cannot speak for the Hon. Member for Gatineau-in the area that she represents, in a manner, as I said, consistent with what we are doing west from the city.
Perhaps the Minister could take this occasion to indicate to us whether or not the Government would be favourably disposed to entertain such a proposition were it to come forward from the municipalities of that area, as I expect it will very shortly.


Stewart Donald McInnes: Mr. Chairman, may I say that the geography is not in stone. We are prepared to entertain discussions with the Hon. Member and any constituency. I would invite him to do that. I will not make any commitments but we will certainly entertain dialogue.


Mr. Belsher:: Mr. Chairman, 1 have listened with interest to the Hon. Member for Glengarry-Prescott-Russell. I want to caution the Hon. Member. I come from the west coast. Looking at the National Capital and the National Capital Region, I am proud of our capital. I do not want the capital region to grow in size. It is a very costly venture as it is. Members here are trying judicially to look after what taxpayers' money is spent on. Just how large a region do we need? That is a debatable point.
1 caution the Hon. Member not to tell his people at home that their area will be put into the National Capital Region so that suddenly the NCC will start looking after a great deal of his riding. Coming from British Columbia, 1 am not sure I want to see the national capital grow too much larger than the region it already occupies.


Don Boudria: Mr. Chairman, 1 wish to speak on this particular clause in order to avoid speaking on third reading, perhaps in response to the Hon. Member as well as to the Minister.
1 thank the Minister for his response, which provides me with cautious optimism. 1 want to indicate to the Hon. Member who has expressed concern that I as well share his concern. 1 appreciate the position which he brings forward.
What 1 am asking is that the National Capital Region be permitted to exist in an equal distance east of Ottawa as it does west of Ottawa. We are not asking for anything to be changed that is not consistent with the present policy. Surely, if it warrants reserving an area of protection some 50 miles on one side of the city then it should be consistent on the other side. That is merely what I was stating today.
National Capital Act
The Hon. Member should realize that just because an area is designated by the National Capital Commission, it does not necessarily mean that the Commission will have to spend funds on it. We know that the NCC only has authority over lands that it owns and not over other lands. If the owner of one of the islands which 1 mentioned earlier in the Ottawa River wanted to give the land to the National Capital Commission, the NCC could not accept it because it is not within that territory, something which I believe it should be. Even if the NCC could get the land for nothing it could not accept it. That is why I am looking for those changes.
With those remarks I will conclude by adding the following. My colleague from Ottawa-Vanier has suggested to the National Capital Commission in the area of programs for some time that the NCC should develop a system of what he calls visitors' passports which would permit a visitor from out of town coming to the city to buy at a discount rate a ticket to the National Arts Centre, the National Gallery and the Museum of Civilization, and so on. By buying the tickets all together, one would receive a discount. Also, this would be in the form of a passport book which could be stamped as the person visits the facilities and brought back home as a souvenir. I think that the idea is novel. It is an interesting one. I want to take this opportunity to restate it and invite the NCC to look at the proposal suggested by my colleague. 1 do not necessarily need a response to it immediately. However, I want to restate it for the benefit of the House.


Claudy Mailly: Mr. Chairman, I made a mistake when I spoke earlier. 1 mentioned that the NCC was founded in 1968. It has been beavering away since 1958. I would like that error corrected since I might not be here this afternoon when the "blues" come around.
I also wish to say to the Minister that I appreciate the work that the NCC is doing in my area. However, I would like to underline the fact that perhaps the NCC has been intervening on the Quebec side only recently, in the last 10 years, and that we in the Municipality of Gatineau, which is the main city in my riding, are a little bit worried about the 10-year plan which has been introduced by the NCC. There does not seem to be too much that the NCC will be doing in our territory. I would like the Minister to again take a look at that plan to ensure that we are not blocked from development for the next 10 years because it is not in that 10-year plan. It is very important for the citizens in my area to feel that they are indeed part of the National Capital Region, which they are.


Don Boudria: Mr. Chairman, perhaps I could just ask one final question of the Minister which I omitted to ask him earlier. It pertains to the change in the Bill with regard to the Financial Administration Act whereby the NCC is looking for a mandate so that it would not be required to go to Treasury Board when approving contracts. We did that in a clause that is already accepted but under the general heading of the title

August 25, 1988
clause. Of course, I think you would find, Mr. Chairman, that the question would be in order nevertheless. I want to be assured that in fact we will be having rules and regulations under the Financial Administration Act until such time as a completely different set of rules is established for the NCC which would permit it to entertain the construction of a piece of roadway, for instance, and not have to go to Treasury Board, which is a sometimes awkward and lengthy process in order to complete the construction of a project, say, before winter comes. 1 understand that that is a problem now. 1 want to be assured that the rules will be in effect until the new rules are designed for the NCC in such a way so as to preserve the tendering process and so on of the Government.
1 also want to make sure that the new rules that are adopted by the National Capital Commission will be done in such a manner so as to preserve in the long term the tendering process while assuring that something speedier is there than the present rules which I recognize are cumbersome.


Stewart Donald McInnes: Mr. Chairman, I give the assurance to the Hon. Member that we are making this Crown corporation perform as all other Crown corporations perform. A set of rules and a tendering process like other Crown corporations will be put in place.


[Stage Direction]
Title agreed to.
Bill reported, read the third time and passed.
The Acting Speaker (Mr. Reid):: It being after 1 p.m., I do now leave the chair until 2 p.m. this day.
At 1.40 p.m. the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.


Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, the grave accident at Saint-Basile-le-Grand points to the urgent necessity of accelerating research to render PCBs harmless by way of a neutralizing process.
Across Canada there are hundreds, perhaps thousands of locations where PCBs are stored, posing a potential risk to the population. It becomes, therefore, imperative to intensify research so as to arrive very soon at a technological breakthrough that would greatly benefit Canadians.
Unfortunately, this Government weakened the research capability of the National Research Council when in November, 1984, the Minister of Finance (Mr. Wilson) cut the NRC
budget by over $60 million. Once again we call on the Government to reverse that decision and provide the NRC with the funds necessary for accelerated research on ways and means to neutralize PCBs. This is a matter of urgent public interest.



NATIONAL PARKS


Mr. Gordon Taylor (Bow River):: Mr. Speaker, the monthly rents being charged civil servants and the RCMP who live in Government owned houses in Banff National Park are excessive. A three-bedroom single family detached home in Banff rents for $800 to $1,100, while a similar home in Jasper National Park is $300 lower, and in other national parks the rents are up to $600 lower.
When compared with monthly rents in similar Alberta towns Banff is higher by more than $400. In addition, Parks Canada has been reluctant to set aside areas for single family homes and so renters have no choice. No wonder the Banff civil servants are enraged. I ask the President of the Treasury Board (Miss Carney) to lower the Banff rates so they are, at least, at the same level as rents charged in Jasper. When Government is a landlord it should be an example of fairness and should never act as an oppressive tyrant.



UNNECESSARY VIOLENCE IN NATIONAL HOCKEY LEAGUE

Iain Francis Angus: Mr. Speaker, in a few short weeks from now hundreds of thousands of Canadian young people from coast to coast will be getting ready for another season of amateur hockey. Many will spend long hours on the hockey rinks practising and honing their skills, and dreaming of one day playing in the National Hockey League.
Unfortunately, the NHL continues to turn a blind eye to unnecessary violence that all too often rears its ugly head. The inevitable result was what we witnessed yesterday-the spectacle of a handcuffed Dino Ciccarelli being led out of a courtroom and into a jail, all as a result of an unnecessary assault during a hockey game last season.
Hockey is a tough, rugged game that combines skill, strength, speed, and determination. But hockey is not a game for goons or a game where unnecessary violence should be tolerated at any level-and that includes the NHL.
August 25, 1988

Hockey is Canada's greatest contribution to the world of international sport. Hockey is our game, a Canadian game, and we should not let ugly, squalid scenes of blood and violence make it less than what it is-one of the world's greatest sports.
Perhaps the federal Government could help by developing an anti-violence poster, comparing Ciccarelli in handcuffs on one hand with the non-violent superstar Wayne Gretzky on the other, and posting it in the arenas of this land.



DANGEROUS SUBSTANCES


Mr. Guy St-Julien (Abitibi):: Mr. Speaker, no one in Quebec wanted the PCB disposal plant. What is dangerous in other places will also be dangerous where we live, in Abitibi.
The greatest concentration of PCBs is in Montreal and on the banks of the St. Lawrence, where the greatest concentration of population is too. It is very costly to remove the danger from these people by choosing Abitibi-Temiscamingue as a dump site. What will happen to us?
Bringing PCBs to Senneterre is only one step. Once they are all disposed of, other toxic wastes will follow. Opening the door to PCBs means opening the door to all toxic wastes. The region is big and we are few. However, we are very much alive and we love our environment. It is unacceptable for the Government of Quebec to use us as the garbage dump of North America.
I would like to quote (Quebec Environment) Minister Lincoln: "The issue of PCBs is very emotional; I do not judge these people in Senneterre. If there were a dump in Beacons-field tomorrow, perhaps I would react the same way."
Mr. Speaker, no PCBs in Abitibi-Temiscamingue!



THE PRIME MINISTER

Ms. Sheila Copps (Hamilton East):: Mr. Speaker, is there no low to which our Prime Minister (Mr. Mulroney) will not stoop in his attempt to keep quiet on issues of pressing national importance? I would like to read into the record a statement made by his former press aide, Michel Gratton.
When Mr. Gratton decided that he was going to write a book, no less than the Prime Minister went after him in a desperate attempt to try to stop him from telling the truth. "They got to me emotionally, using people I like to make me feel guilty. First they tried to stop me from writing the book, and when that did not work they tried to rattle me so I would
be nicer. When that didn't work, they spread rumours about my personal life. All this comes from Mulroney himself'.
That is is not a statement of a Liberal Member or an opposition Member. That is a statement of the former press aide to the Prime Minister. My mother always said, "You are judged by the company that you keep". I think that the reason that the Prime Minister is in the mess that he is in today is because dirt starts from the top down.


Mr. Speaker:: I have listened carefully to the Hon. Member's statement, and I just want to remind Members that statements are not meant for personal attacks on other Hon. Members. I have accepted the statement, but 1 just wanted to mention that.



RAILWAYS


Mr. Svend J. Robinson (Burnaby):: Mr. Speaker, we were glad to learn yesterday that the Government of Quebec is extending the moratorium on the Montreal-Saint-Hilaire suburban train until June 1989. However, we are sorry about two things in this matter: first, the complete absence of the Conservative Government in the search for a solution to the suburban transportation problem; second, the fact that the small municipalities in this region will have to cover a deficit that CN rejects. The reason there is a deficit, Mr. Speaker, is that CN and the federal Transport Minister never invested in improving suburban passenger service in this region. Again, Mr. Speaker, we are pleased with the initiative taken by the provincial Government and the municipalities to save their suburban trains, but we also deplore the absence of the federal Government, which should also contribute to the development of suburban train transportation in all regions of the country.



EXTERNAL AFFAIRS


Mr. Alan Redway (York East):: Mr. Speaker, formal negotiations aimed at bringing about a peaceful settlement in Cyprus will resume at long last on September 15, after some three and a half years of interruption.
The key issues in these negotiations will be the guarantee of minority rights and the possible establishment of a federal system of government.

August 25, 1988
Canada has maintained a peacekeeping force on Cyprus since 1963. We have an international reputation as a peace negotiator. We have experience with both minority rights guarantees and with a federal system of government.
Because of this I would urge our Government to take and to play an active role in these Cyprus peace negotiations.



ETHNIC AFFAIRS


Hon. Bob Kaplan (York Centre):: Mr. Speaker, there are one and a half million Canadians of Italian origin living among us. They speak one of the most beautiful languages in the world. It is also one of the simplest languages of the world. It is very easy to pronounce for French and English speakers, and yet, in general, their fellow Canadians make very little effort to pronounce Italian names as they are pronounced by the people who hold those names.
The rules are so simple that they can be learned in less than a minute, and yet many Italian Canadian families are changing their own pronunciation of their names to correspond with the way that their fellow Canadians wrongfully pronounce them.
The rules are simple. Final e is pronounced, ch is pronounced like a k, c followed by e or i is pronounced like ch, and g followed by e or i is pronounced like j. What could be simpler?
Let us stop murdering the Italian language when we use these names, and start pronouncing them properly.


Some Hon. Members:: Hear, hear!



MUNICIPAL AFFAIRS


Hon. Bob Layton (Lachine):: Mr. Speaker, I am pleased to add my most cordial greetings to all those who attended the unveiling of a monument by Robert Roussil in memory of Rene Levesque in Lachine on Monday evening.
As our Prime Minister wrote in his congratulatory message:
"Robert Roussil has created a strong, original work which not only reveals the talent of a great artist but also well expresses his deep understanding and admiration for Rene Levesque.
Whether or not one agrees with the ideal that guided Rene Levesque's commitment, he was one of that province's great political personalities for all Quebecers."
The presence of thousands of residents of Lachine at the unveiling shows attachment and recognition for this great democrat.
On behalf of all, I wish to congratulate Mayor Guy Descary, the members of his Council and the citizens of Lachine for this initiative.



MEDICAL CARE


Ms. Margaret Mitchell (Vancouver East):: Mr. Speaker, we agree with the President of the Canadian Medical Association that the emergence of a two-tier medical system, which favours the rich, and the lack of recognition of nurses are two serious problems facing Canada's medical system. We do not share his solutions. User-fees would undermine one of the best health care systems in the world, which must be accessible regardless of incomes.
With the rapidly growing aging population we must give much greater priority to community support, rather than costly institutionalization, and to preventive measures that promote health rather than having an obsession with expensive high technologies.
Despite the Health Minister's declared policy, only about 10 per cent of our health dollar goes into community health services and health promotion. The federal Government's overall contribution to health care has been reduced by $5.6 billion over the past five years.
Nurses must be recognized with decent pay and not privatized as in Alberta. Services of all health care practitioners should be covered directly under medicare. Governments must develop community health clinics with flexible outreach services.
We urge the federal Government to restore 50 per cent funding provided that provinces agree to much greater emphasis on prevention and health promotion.



REGISTERED RETIREMENT SAVINGS PLANS


Mr. Reginald Stackhouse (Scarborough West):: Mr. Speaker, according to current registered retirement savings plan regulations we should all be dead by age 90, or if we are hardy enough to live that long we should be able to live without any money.
August 25, 1988

At age 71 an RRSP can be converted into a registered retirement income fund but the user must take out all the money by the age of 90. That may have been all right when the regulations were written, but now more and more Canadians are living into their nineties and the question arises what are they going to live on unless this outdated regulation is changed?
They cannot all be like my mother-in-law, Mr. Speaker, who is alive and well at age 93 and is still winning money at cards three nights a week.


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!



HUMAN RIGHTS


David Orlikow: Mr. Speaker, in June Callwood's column which appeared in The Globe and Mail yesterday she reported on the tragic plight of Elena Keis, a desperate, frightened woman living in Leningrad who applied for permission to emigrate to Israel eight years ago. Time is running out.
On September 9, her only son becomes 18 years old and will be conscripted into the Soviet Army. Elena Keis has been adopted by the Jewish community of Toronto. Michael Dukakis and his wife sent a cable recently to Mr. Gorbachev urging him to approve her application to leave.
Her mother, father, and older sister were permitted to leave the Soviet Union. She and her husband have not worked in sensitive jobs for more than five years. In this last year her physical and mental health has deteriorated drastically.
I am certain that all Members of Parliament will join with me when I urge the Secretary of State for External Affairs (Mr. Clark) to make representations to Mr. Gorbachev on Elena Keis' behalf.



AGRICULTURE


Mr. Bill Tupper (Nepean-Carleton):: Mr. Speaker, the Ontario Federation of Agriculture recently endorsed the Government's tax reform package as it relates to farmers.
Under tax reform farmers will still be able to use cash accounting rather than accrual accounting. Moreover, when it sorts people out for tax purposes the Government will not use either the profit test, to distinguish between farmers and nonfarmers, or the gross revenue test, to distinguish between fulltime and part-time farmers. Part-time farmers will now be able to claim farm losses of up to $8,750 against their other income. Full-time farmers will be able to claim all of their farm losses against other income.
The Government will also extend the flexible livestock inventory provision to all commodities, which will enable farmers to average their income over a number of years.
The Ontario Federation of Agriculture's endorsement of tax reform indicates how this Government achieves just and equitable results through consultation with those who will be affected by laws it contemplates making.



CANADIAN BROADCASTING CORPORATION


Mrs. Jennifer Cossitt (Leeds-Grenville):: Mr. Speaker, three weeks ago the new FM station CHXL in Brockville began transmitting, and complaints regarding interference with telephones, TV reception, and other radio station reception have been flooding into my office.
I have called upon the Department of Communications to work closely with the broadcaster to resolve these complaints quickly and to bring about a solution to the problem.
In addition, area residents can now no longer receive the CBC signal from Kingston or Ottawa. CBC for 12 years has had a licence to transmit from its Maitland tower but because of technical difficulties has not fulfilled its responsibilities. As repeated strong representations have resulted in no action taken by the CBC, I therefore call upon the CBC to stop dragging its feet and meet its obligations immediately. If not, CRTC should revoke its licence.



NUCLEAR ENERGY


Paul Gagnon: Mr. Speaker, earlier today I had the honour of presenting a report entitled Nuclear Energy: Unmasking the Mystery.
This report has 14 recommendations which come from the Standing Committee on Energy, Mines and Resources. Five out of the seven members represent areas of fossil fuel production, not the nuclear industry. Yet this report is very supportive of nuclear energy in Canada because of its environmental benefits, economic advantages in parts of Canada, and its security and flexibility.

August 25, 1988
Oral Questions
Given today's increasing concerns of acid rain, dying maple trees, fishless lakes, and the greenhouse effect, nuclear energy must, and I emphasize must, have a role in meeting Canada's energy needs.



ORAL QUESTION PERIOD


Hon. Jean Lapierre (Shefford):: Mr. Speaker, I know they are talking about a strike at Canada Post, but 1 did not know the Government was on strike as well. At last, here comes the Deputy Prime Minister.
Mr. Speaker, during the last few days, we have tried to obtain clarification regarding the actions of the Prime Minister's chief of staff, especially in his conversations with the Hon. Member for Rosemont.
During that time, we have had four different versions from the Government.
In the first version the Prime Minister told us there was no threat. In the second version, the Deputy Prime Minister told us the purpose was to ask the Hon. Member for further details and to remind her of her duty to hand over any evidence she had to the police. The third version came from the Deputy Prime Minister: "We warned her of the way her Quebec colleagues might react." And finally, yesterday, after being advised that a recording existed of this conversation, the Prime Minister's Office said: "She should be prepared to suffer the consequences of her actions."
Consequently, I want to ask the Deputy Prime Minister what was actually said during that conversation. Was the Hon. Member for Rosemont right when she said an attempt was made to force her to retract a statement she said was true? Was the approach taken by the Prime Minister's Office an attempt to hide the truth from Canadians? What is the Government's real version this morning?


Hon. Don Mazankowski (Deputy Prime Minister and President of the Privy Council):: I responded to that question yesterday, Mr. Speaker, and my answer remains the same.
[ Translation]


ALLEGED REMARKS OF MEMBERS FOR LASALLE AND DUVERNAY-GOVERNMENT POSITION
Jean-C. Lapierre: Mr. Speaker, I am glad the Government is sticking to the same version for two days.
However, this morning, Michel Gratton, a friend and confidante of the Prime Minister, gave The Globe and Mail a
few details about the way the Prime Minister had acted in the past, and he is convinced that here again, all the arm twisting that was done to get Members to retract their statements came directly from the Prime Minister.
I want to ask the Deputy Prime Minister whether the other Members who did retract their statements today, the Hon. Member for LaSalle and the Hon. Member for Duvernay last week, whether they were also contacted by the Prime Minister's spokesperson or whether they retracted spontaneously?


Mr. Speaker:: I am having some difficulty with the question. As I understood it, the Hon. Member is referring now to something that somebody has said as reported in a newspaper. The Hon. Member's first question was, I think, in order because he was referring-and I know the Hon. Member would want to hear me carefully-to statements made by Ministers and the Prime Minister in the House. I, of course, allowed it. However, this question, I think, is getting into a different situation. Of course, if the Hon. Minister wishes to reply, he can, but I have to advise the House that I think it is out of order.
Certainly the Hon. Member is always helpful to the Chair and to the House. I would give him a chance to reconstruct his question.


ALLEGED STATEMENTS OF MEMBERS FOR DUVERNAY AND LASALLE-GOVERNMENT POSITION
Jean-C. Lapierre: I thank the Chair for its advice. In fact, I was referring to statements made by two Members here in the House, the Members for Duvernay and LaSalle, when both Members had trouble remembering, had a few translation problems and, in the process, were at a loss for words. Consequently, I want to ask the Deputy Prime Minister: Was the Peter White approach used in the other two cases? Did these Members retract spontaneously or was it a case of arm twisting?


Donald Frank Mazankowski: Mr. Speaker, the Hon. Member can choose to draw whatever conclusions he wants out of stories in the newspaper. I am not going to engage in the interpreting of speculative journalism, particularly on the floor of the House.


Mr. Speaker:: The Hon. Member, of course, has another question, and I know that he will be as careful as he has been to keep the question within the bounds. I let that question go and I appreciate his co-operation.
August 25, 1988

[ Translation]


QUERY WHETHER PRIME MINISTER'S OFFICE CONTACTED MEMBERS FOR LASALLE AND DUVERNAY
Jean-C. Lapierre: Mr. Speaker, I could quote directly from the article by Mr. Gratton, the Prime Minister's friend and confidante, who gave a very good description of the kind of action taken by the Prime Minister in the past. He says: "1 am surprised he still does it".
Mr. Speaker, what I want to ask the Deputy Prime Minister once again is this: I know that for the last few days, spokespersons at the Prime Minister's Office, headed by Marc Lortie, have said how furious, enraged and upset the Prime Minister was, but did this have any effect on the retractions that took place? Were those retractions spontaneous?
To get back to my question: Was the Hon. Member for Duvernay contacted by the Prime Minister's Office? Was the Hon. Member for LaSalle contacted by the Prime Minister's Office? Would that explain their decision to rise in the House and say they were misinterpreted and misquoted and blame it all on the media?


Donald Frank Mazankowski: Mr. Speaker, the Hon. Member is really reaching now. 1 know that he is trying to get his former colleague, Mr. Serge Joyal, elected to the House of Commons, so I suppose he is getting prompted from him. 1 have tried to answer all the pertinent questions relative to this matter as accurately as I possibly can. I have given the information to the House that has been made available to me.
The Hon. Member chooses to malign and accuse people on the basis of unfounded allegations. If he wants to do that, based on speculation and inaccurate statements in news stories, he can go right ahead. May I remind you, Mr. Speaker, that that is part of the process which has undermined the integrity of this House and has a reflection on all Members of the House. I wish the Hon. Member would start ceasing and desisting from this practice.


RESIDENTS OF SAINT-BASILE-LE-GRAND AND AREA-REQUEST THAT SPECIAL HEALTH PROGRAM BE INSTITUTED
Mrs. Lucie Pepin (Outremont):: Mr. Speaker, my question is for the Minister of National Health and Welfare but in his absence, I will direct it to the Deputy Prime Minister.
Yesterday, the explosion of 20,000 gallons of PCBs forced the evacuation of 3,500 people from their homes. We know that PCBs are highly toxic substances and that several experts are concerned about the likely consequences on the health of the people of Saint-Basile-le-Grand and the surrounding area.
Oral Questions
Can the Minister assure the residents of Saint-Basile-le-Grand and the vicinity that the federal Government will implement a special health research and follow-up program in order to determine both short and medium term, impact on all those affected by this accident?


Hon. Thomas Siddon (Minister of Fisheries and Oceans):: Mr. Speaker, I want to assure the Hon. Member for Outremont and all Members of this House of the Government's extreme concern for the well-being of the citizens of Saint-Basile-le-Grand and the surrounding areas as a result of this tragic fire.
1 am sorry some Hon. Members opposite are not as concerned about this issue as the House should be. We are extremely concerned about the combustion of some 5,000 gallons of PCBs in a warehouse site in Saint-Basile-le-Grand. 1 can give the House a status report.
As we know, the fire has been extinguished and a cleanup is commencing. A fire investigation is under way as to the cause of this tragic event, and sampling and analytical work is ongoing. In fact, officials from the Department of the Environment were on site within half an hour of the first alarm and a full scientific team was on site first thing yesterday morning. They have been working with a committee of experts who were on the scene scientifically measuring the extent of contamination and any possible hazards that may result from this tragedy. The team includes a principal toxicologist, an expert in the matters of PCB contamination and its combustion, Dr. Albert Nantel, and Dr. Carriere, a local medical adviser who is familiar with these problems.
I can assure the House that the Government and the Minister of the Environment, who is at this very moment travelling to the site and will make a statement later today, are taking every necessary precaution to ensure the health of and the orderly reoccupation by the citizens when it is safe to do so.


RESEARCH INTO NEUTRALIZATION OF PCBS
Lucie Pépin: Mr. Speaker, 1 wish to direct my suplementary question to the Deputy Prime Minister.
The grave accident at Saint-Basile-le-Grand points to the urgent need for PCB research. Across Canada there are hundreds and perhaps thousands of locations where PCBs are stored, posing risk to the population. It therefore becomes imperative to intensify research. Unfortunately, the Government cut our research capability at the National Research Council when in November, 1984, the Minister of Finance cut the NRC budget by over $60 million.
Will the Government reverse its decision and provide the
NRC with the funds it needs to accelerate research on ways

August 25, 1988
Oral Questions
and means to neutralize PCBs? It is a matter of urgent public interest.
Hon. Frank Oberle (Minister of State (Science and
Technology)): Mr. Speaker, perhaps I could answer this question. The Hon. Member made some erroneous utterings in her preamble.
There has not been the cut to the National Research Council she has alleged, nor has this particular program of PCB research been targeted for any cuts. In fact, research is going on, not just at the NRC but in government laboratories and universities, in ways to handle, dispose of, and store this dangerous substance. The Hon. Member's assertion is wrong. The Government is acting and research institutes are dealing with the problem.
[ Translation]


MONTREAL REGION-PROPOSED PCB WAREHOUSING SITES- GOVERNMENT POSITION
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, my question is for the Minister and it deals with the serious situation that prevails in the Montreal area because of PCB storage sites. Yesterday when I asked the Minister if the federal Government had a list of those storage sites in the country, the answer was a very clear no. However, would the Minister confirm today that 20,000 liters of PCB's are warehoused on the roof of The Bay Department Store in the heart of downtown Montreal?


Thomas Edward Siddon: Mr. Speaker, 1 cannot confirm the accuracy of the suggestion offered by the Hon. Leader of the New Democratic Party. As he knows, as part of the policy of eliminating PCBs from transformer systems across Canada, it is not legal to use and install such transformers. In fact, it could well be that there are some transformers still in operation, perhaps on the roofs of buildings, but this would not, I would imagine, be a storage situation.
Department of Environment officials have provided me with an assurance that the full inventory of PCB storage locations is available and regularly updated. As well, the Minister of the Environment, working with provincial Environment Ministers through the Canadian Council of Resource and Environment Ministers, has established specific storage sites outside urban areas, and there is, as the Hon. Member knows, a plan to remove all of these concentrations of stored PCBs to these safe sites. It is part of a federal-provincial initiative and an action plan which has been developed in consultation with provincial environment officials who have the legal and final authority within their provinces to ensure that these measures are fully complied with.


SITUATION IN MONTREAL
John Edward Broadbent: Mr. Speaker, I had confirmed for me just a while ago that there are indeed located on the roof of The Bay store in downtown Montreal some 20,000 litres of PCBs. This is a very dangerous substance and
it strikes one as dangerously serious in its implications if there should be a fire.
I am also told PCBs are stored in The Gazette building in downtown Montreal, perhaps on the roof again. I have also learned that until very recently, and we do not know when, there were 60,000 litres of PCBs stored by Air Canada at Dorval International Airport. I am told they were just moved recently and I would like the Minister to find out just how recently that was.
More concretely, with respect to the existing sites in the heart of Montreal, would the Minister confirm that the federal Department had a list of sites where these substances were stored? Will he also find out when the Government first learned of them being stored on the roof of The Bay store? In addition, could he tell us why the federal Government did not take action to have these PCBs removed from what was obviously an unsafe site in the centre of Montreal?


Thomas Edward Siddon: Mr. Speaker, I can assure the Hon. Leader of the NDP that the Government and the Minister will certainly be doing everything within their power and jurisdiction to see that such dangerous storage sites are eliminated from all urban areas of Canada. I am not able to confirm whether or not there are quantities of PCB coolant fluids on The Bay store in Montreal.
I do not think he would expect me to assure him of that today.
However, I can assure him that the Minister of the Environment, who is on his way to Montreal at this moment with the Minister of Transport, will be making a full statement after his arrival and inspection of the site, and should be able to clarify the extent to which there might be other similar storage sites in the Greater Montreal area. I certainly share the concern of all Members of this House over any such storage of PCBs in any of our cities.


REQUEST THAT LIST OF STORAGE SITES BE MADE PUBLIC
John Edward Broadbent: Mr. Speaker, I am told that the Quebec Department of the Environment prepared a list of some 50 such sites in that province some time ago. There are known to be some 500 in the province of Ontario. I am also told that a former employee of the federal Department of the Environment, Mr. Marc Levy, lost his job not too long ago because of a conflict of interest in this respect, and he has since been involved in doing work for private gain in the storage of PCBs.
Given that, will the Minister assure us that the Minister of the Environment will make public tomorrow a complete list of the storage sites of this very dangerous substance so the people of Canada will know whether they are living in close proximity to such a site? Will he also assure us that the Government will take steps to make sure that all protective measures have been put in place, and that the Minister will make a comprehensive statement on federal government policy dealing with the present serious situation in Quebec, as well as outlining a policy for all of Canada?
August 25, 1988


Thomas Edward Siddon: Mr. Speaker, I cannot make undertakings on behalf of the Hon. Minister of the Environment in the House this afternoon. However, 1 can assure the Hon. Member that all of the available information, that is to say the inventory of PCB storage sites in Canada, is available to the Department of the Environment. Working with provincial environment officials through the Canadian Council of Resource and Environment Ministers, an action plan is being developed to do exactly what the Hon. Member has asked for.
At the same time I understand his concern and that of all Members, and in particular the residents of Saint-Basile-le-Grand, that something more urgent and immediate must be done. There is indeed an investigation under way into the circumstances of the fire and the necessary measures which must be taken to provide a measure of confidence to the displaced residents of this part of Montreal.


PRESENCE IN GALLERY OF SASKATCHEWAN MINISTER OF ENERGY AND MINES
Mr. Speaker:: I wish to draw to the attention of Hon. Members the presence in our gallery of the Hon. Patricia Smith, Minister of Energy and Mines for the Province of Saskatchewan.


Some Hon. Members:: Hear, hear!


EMPLOYMENT
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, my question is directed to the Deputy Prime Minister. Yesterday the Minister of Employment categorically rejected the proposal to set up special adjustment programs for workers displaced by free trade. How can the Government support that position when the provinces, the Macdonald Commission, the C. D. Howe Institute, and others, along with two Standing Committees of this House, all recommended special adjustment programs? Is the Government going to let these workers fend for themselves after free trade?
Hon. Barbara McDougall (Minister of Employment and Immigration):: Mr. Speaker, as the Hon. Member knows but refuses to accept, we have within the Canadian Jobs Strategy Program the flexibility to deal with labour adjustment in all of its categories. Five million workers a year are affected by changes in their jobs, in the workplace or in their work description now. There are going to be 251,000 new jobs created under free trade and it is our job to ensure that programs are in place to ensure workers can take advantage of those opportunities. I can assure the Hon. Member that no one
Oral Questions
has their interest at heart more than this Government and this Minister.


GOVERNMENT POSITION
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, is everyone else wrong and the Minister right? The present programs are not working. They are not adequate. Since 1984, the programs have been cut by 32 per cent, from $2.2 billion to $1.5 billion. They are not working and the proof lies in the fact that we have over 10 per cent unemployment in five of our provinces, yet we have a shortage of skilled workers in Ontario. If the programs are working why are we left with a situation like this? Why is the Government content to have that sort of program with the introduction of free trade?
Barbara Jean McDougall: Mr. Speaker, the Hon. Member knows that regional differences in unemployment rates were not invented by this Government. Quite the reverse. Unemployment in all regions of Canada has come down since this Government came into office. If our training programs are so terribly bad, then why is unemployment at its lowest level in so many years?
The programs we have put in place are sufficient to deal not only with any adjustments that come with free trade, but also to prepare the Canadian people in the 1990s for a fast changing workforce. We are creating real jobs, not paint-the-fence jobs.


DISASTERS
Iain Francis Angus: Mr. Speaker, my question is directed to the Minister of Agriculture and concerns the fire in Saint-Basile-le-Grand and its impact on the agricultural community.
It is our understanding that the Government of Quebec has quarantined animals from that area. Can he advise the House what action the federal Government is taking in its jurisdiction dealing with livestock in particular?


Hon. John Wise (Minister of Agriculture):: Mr. Speaker, I am not in a position at this moment to supply details other than to say that, immediately upon recognition of the incident, our people were on the scene and have been there since. They are working in full co-operation with the environmental and health and welfare people. From Canada's point of view, we have developed an action plan. When additional, detailed and accurate information is received from the environmental and health authorities, we will implement whatever action is necessary to ensure the health and safety of the Canadian consumer. We will also be involved if the area is designated a disaster area. If sufficient funds are provided to trigger the federal-provincial agreement, then Agriculture Canada will be fully involved on behalf of farmers and consumers.

August 25, 1988
Ora! Questions


COMPENSATION SOUGHT FOR AREA RESIDENTS
Iain Francis Angus: Mr. Speaker, my supplementary question is directed to the Minister of Fisheries and Oceans and is with regard to the compensation question. The Minister of Agriculture just indicated that the area could possibly be declared an emergency area under the normal rules of the Government of Canada and the Government of Quebec.
Will the Government indicate whether it is prepared to work with the Government of Quebec to provide compensation to those individuals who, through no fault of their own, have had personal effects, livestock, et cetera, destroyed, as well as a disruption of their lifestyle? Is the Government prepared to enter into an agreement with the Province of Quebec for compensation?


Thomas Edward Siddon: Mr. Speaker, 1 think the question is slightly premature. Not to in any way trivialize the nature of the event that has occurred, it is important, first, to have scientific teams on the site and to do a careful assessment of the extent of possible damage to the surrounding areas, the homes, the properties, the gardens, and the health of the individuals who must return to live in their community.
That assessment is under way. As I have indicated, there is a team of scientists taking and analyzing samples which are being reviewed on site by a committee of experts. Until we have a full report at the end of that process it would be premature to speculate on a particular level of compensation.
However, the Hon. Member and the House can be assured that the Government, as it always has, will meet its full measure of responsibility to live up to the genuine needs of people which arise from this tragic and unforeseen event.


EMPLOYMENT
Mr. Brian Tobin (Humber-Port au Port-St. Barbe):: Mr. Speaker, my question is for the Minister of Employment and Immigration. Yesterday I spoke to the Minister regarding the plight of plant workers at Brig Bay, Newfoundland, and I thank the Minister for promising to investigate that situation.
Today I want to bring to the Minister's attention the crisis in the inshore fishery on the Northern and Burin Peninsulas of Newfoundland. In both these areas fishermen have not had enough earnings in the last 15 weeks to qualify for unemployment insurance this winter. They need either direct financial compensation, such as that given to farmers, or a job development program which will pay them a wage equivalent to what they would earn as fishermen during a normal fishing season.
Is the Minister prepared to direct her officials to investigate the situation in both the Burin and Great Northern Peninsulas of Newfoundland? Will she ask those officials to devise, on an emergency basis, an appropriate response to the needs of these fishermen in Newfoundland and Labrador?


Barbara Jean McDougall: Mr. Speaker, I appreciate the question from the Hon. Member. We are watching the situation in Newfoundland and Labrador very carefully. As the Hon. Member knows, when there was a hardship of this nature in 1985 the Department of Fisheries and Oceans and my colleague, the Minister of Fisheries and Oceans, were very involved in coming up with a solution, which solution was not an extension of UI benefits.
In answer to the question about investigating the situation, my officials will be meeting with his and he and I will be discussing the situation further.


REQUEST FOR EMERGENCY ASSESSMENT OF SITUATION
Brian Vincent Tobin: Mr. Speaker, I want to point out to the Minister that there is very little resemblance between this situation and that in 1985. In 1985 we were talking about workers who had had a season which ended short of the 10 weeks required to qualify for unemployment insurance. This year we are talking about workers who have had only one or two weeks of earnings in the last 15.
It is not only a matter of having income this winter, it is a matter of having the funds to put bread and butter on the table now. It is a real crisis, in particular on the Burin and Great Northern Peninsulas of Newfoundland.
I ask the Minister not to wait until November 15 to do an assessment but to direct her officials to do an emergency assessment now and to find a way to assist fishermen and their families now, many of whom have children going back to school in a few weeks, to put bread and butter on the table and to do all the things that any Canadian has to do to prepare
August 25, 1988

their families for school in the fall and to get through the coming winter months.


Thomas Edward Siddon: Mr. Speaker, as my colleague, the Hon. Minister of Employment and Immigration, has said, her officials and mine are examining the circumstances which could lead to the necessity of such an emergency program. I am pleased to have been a part of the decision making which led to the program in 1986 which my colleague mentioned. I believe there was a smaller program in 1987 in other parts of Newfoundland.
However, it has never been our policy to announce assistance, which could well be more greatly needed later in the year, when the fishing season is still under way.


Brian Vincent Tobin: They are hungry now.


Thomas Edward Siddon: There are still fishermen from the Labrador Straits and the Great Northern Peninsula fishing off the coast of Labrador. As the Hon. Member for St. John's West pointed out in this House last week, the Newfoundland fishery has produced much higher financial benefits and landings in total than it did last year. We will certainly give very serious consideration to the needs in the areas to which he has referred, the Burin Peninsula and the Labrador Straits region of Newfoundland.


THE ECONOMY
Michael Morris Cassidy: Mr. Speaker, I have a question for the Minister of Finance about the increase in interest rates. Despite the pleas of Canada's Premiers last week, the Bank of Canada has today raised the bank rate again and three of Canada's chartered banks have raised their prime rate by one-half of a per cent to 11.25 per cent.
Does the Government intend to take any action to roll back these increases in bank interest rates, or has the Government told its friends in the banks that they can jack up their interest rates because there will not be an election this fall?


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, the Hon. Member is putting a wrong motivation in his question. I think Canadians would accept the fact that we have provided good economic management. That is very evident in the economic policy and results over the last four years.


Some Hon. Members:: Hear, hear!


Michael Holcombe Wilson: We do have the challenge now of increasing inflationary pressures. We have options. We could ignore the problem as the Liberals did in the seventies. We know that that led us to the very high levels of inflation and the consequent high interest rates in 1981-82. Or, we could take a far-sighted, responsible, prudent approach and head off the problem now before it becomes the serious crisis
Oral Questions
that it was in 1981-82. That is the prudent policy to follow and that is what good economic management is all about.


INCREASED INTEREST RATES-IMPACT-GOVERNMENT POSITION
Michael Morris Cassidy: Mr. Speaker, the Minister of Finance seems unaware that, last week, Statistics Canada reported that inflation had gone down in almost every region in Canada. Despite this, the Government supports increases in the interest rates charged by the Bank of Canada and the chartered banks. Why is the government not willing to do something to stop this increase in the interest rates charged by the chartered banks? Does the Government consider the advice given by the premiers of no value? Why does the Government push for higher interest rates despite their harmful effects on home-building and home-buying, on farmers already suffering from drought in the West and on investment and especially job creation in poorer regions?


Michael Holcombe Wilson: Mr. Speaker, I think Canadians understand that there is a clear link between inflation and high interest rates.


John Edward Broadbent: Yeah, the higher the rate, the higher the inflation.


Michael Holcombe Wilson: I ask Hon. Members to think back to 1981-82. I have some newspaper headlines which might be helpful to Hon. Members "Chances receding in fight with inflation", "Acceptance of inflation seems to be getting the upper hand", "Can we beat inflation?", "Inflation now a fact of life". That was after the Liberal Government of the day allowed inflationary pressures to get out of hand.
There is another headline to which I want to refer the Hon. Member, that is, "Realism, responsibility needed to cure inflation". That is the approach we are following as a Government and that will be evident in the economic results in the years ahead.


PENITENTIARIES
Mr. John Nunziata (York South-Weston):: Mr. Speaker, my question concerns the Government's announcement yesterday that Newfoundland's new federal prison will be built in Harbour Grace, a Tory riding, rather than in Buchans. Would the Solicitor General explain what criteria were used in the decision to switch the location of the prison from Buchans to Harbour Grace? Can he explain to the people of Buchans and the people of Canada whether the same criteria were used in this particular decision as were used in the decision to locate the prison in Port Cartier, in the Prime Minister's riding?

August 25, 1988
Oral Questions


James Francis Kelleher: Mr. Speaker, the Hon. Member is making an assumption that we switched the prison site from Buchans. We never selected Buchans as the site.
The Commissioner of Corrections set up a site selection committee and, using that criteria, they investigated a number of sites across Newfoundland, including Buchans. After reviewing the work of the site selection committee, the Commissioner recommended to me that the Harbour Grace area be selected, and I accepted that recommendation.


JUSTIFICATION FOR SITE SELECTION
John V. Nunziata: Mr. Speaker, the Solicitor General knows that money had already been designated in the 1984-85 Estimates for a federal penitentiary in Buchans. He also knows that this new location was chosen even before land was acquired, even before the federal Government was in a position to build a prison there.
The Minister for International Trade said today: "The federal Government cannot justify putting a prison in a community like Buchans which is nowhere near where prisoners' families are living". If this is the policy of the Government of Canada, how can the Solicitor General justify the building of the Prime Minister's prison in a remote part of his riding, in Port Cartier, 900 kilometres away from Montreal, a 14-hour bus ride away from Quebec City? If the consideration is close proximity to family, why was the Prime Minister's prison built where it is?


James Francis Kelleher: Mr. Speaker, I am extremely surprised that the Member complains about us not selecting Buchans as the site for the prison when the former Solicitor General also rejected that site and selected an area in Windsor.
I have here a press release dated August 7, 1984, in which the former Solicitor General, the Member for York Centre, announced that a penitentiary would be built in Newfoundland. "We are going to initiate an assessment of possible sites in the Windsor area later this week and it is expected that a suitable piece of property will be acquired within the next couple of months".
They did what we have done. They rejected the Buchans site because it did not contain a suitable infrastructure. I find it a little difficult that the Member complains now when what we did was what the former Solicitor General of his Government did.


MINISTER'S POSITION
Svend Johannes Robinson: Mr. Speaker, my question is directed to the Solicitor General who will know that
in 1984, the Liberal Party decided to build a federal penitentiary in a Liberal riding.


Sheila Maureen Copps: Retract that.


Svend Johannes Robinson: Now we see a Tory Government building a federal penitentiary in a Tory riding. I want to ask the Minister-


An Hon. Member:: What about Jack Harris?


Mr. Speaker:: The Hon. Member for Burnaby.


Svend Johannes Robinson: In view of the fact that the Prime Minister decided to build a prison in his own constituency, supposedly for economic benefit, if that is the same criteria for the Minister how can he explain on economic grounds not building the federal penitentiary either in the Buchans area or Bell Island area, both of which have desperately high levels of unemployment? Why one standard for the Prime Minister and another standard for the people of Newfoundland?


James Francis Kelleher: Mr. Speaker, as I explained earlier in the House, the site of Harbour Grace was recommended to me by the Commissioner of Corrections after his site selection committee had reviewed various possible sites in Newfoundland. One of the sites they looked at was indeed the Buchans area. However, they determined that the required infrastructure was not present in Buchans but was indeed present in the St. John's region or Harbour Grace area. That is the reason for it.
Certainly Buchans was considered, and indeed the Commissioner of Corrections met personally with the mayor and other members from that community, and listened to them carefully and considered their site.


GOVERNMENT POSITION
Svend Johannes Robinson: Mr. Speaker, if this is suddenly a concern, why was the Government prepared to spend $42 million extra to build a federal prison in the Prime Minister's constituency? What exactly are the standards for prison construction by the Government? Is it economic benefit, correctional criteria, or is it in fact trying desperately to save the ridings of Tory Members of Parliament? Is that not the real reason?


James Francis Kelleher: Mr. Speaker, as I mentioned earlier, the site selection committee determined that Buchans did not contain the necessary infrastructure, which includes access to court facilities, medical and psychological hospitals, doctors and emergency services such as police, fire, and national defence. The Buchans area does not contain that infrastructure. The Harbour Grace area does.
In addition, CSC recommends that a community must have
a minimum population of at least 2,500. Buchans barely has
1,000, and the Harbour Grace area which has been selected
August 25, 1988

has a population of approximately 12,000 to 13,000. It is indeed a most acceptable site.


CORPORATE AFFAIRS
[Stage Direction]
Mir. Alan Redway (York East): Mr. Speaker, my question is directed to the Minister of Consumer and Corporate Affairs. According to senior officials with Canada Mortgage and Housing Corporation, the Metropolitan Toronto area housing crisis is a result of the fact that land for housing is not coming on the market fast enough. They say that one of the major reasons for that is that six companies own all of the development land in the Metro Toronto area.
Will the Minister advise the House if CMHC has asked his officials to investigate whether there has been a breach of the Competition Act? If they have not done so, will the Minister give us his undertaking that he will do so?
Hon. Harvie Andre (Minister of Consumer and Corporate Affairs):: Mr. Speaker, 1 am not entirely sure whether CMHC has asked officials in my Department in that regard. However, the Director of Investigation of the Competition Bureau is aware of the situation and is investigating it.
Due to the confidentiality provisions of the Competition Act, I really cannot say any more in that regard, except that it is being investigated by the Director of Investigation of the Competition Bureau.


IMMIGRATION
Mr. Andrew Witer (Parkdale-High Park):: Mr. Speaker, my question is directed to the Minister of Employment and Immigration. The Minister will know that several weeks ago a group of 205 Ukrainians en route to Rome from Poland claimed refugee status in Vienna and are currently being held in an Austrian refugee camp, faced with possible deportation back to Poland.
The Minister will also know that the group wants to come to Canada and that the Ukrainian Canadian community has made extensive representations to the Minister for Government sponsorship of these refugees. In view of the fact that in recent years there have been virtually no Government sponsored Ukrainian refugees from eastern Europe, will the Minister advise the House whether the Government of Canada is prepared to accept and sponsor these refugees to Canada? Will she seek immediate assurances from the Austrian
Oral Questions
Government that the group will not be deported to any country behind the Iron Curtain?


Barbara Jean McDougall: Mr. Speaker, I thank the Hon. Member and other Members for their interest in this case. As the Hon. Member knows, people of Ukrainian background coming from eastern Europe have either Polish papers or papers from the Soviet Union. These particular cases were brought to our attention. We spent considerable time in an effort to assist them.
The applications are currently being processed, including medical and security procedures. Those procedures will apply. The process is under way. We have already been in contact with the Austrian Government and we are assured that no one will be deported to Poland.
We have asked for assistance from the Ukrainian community, with whom I am meeting next week on this issue, in identifying any cases of special hardship. I understand there are none, but if some are brought to our attention we will certainly process those on a priority basis. Our expectation is that these people, providing the process goes smoothly and all the people are cleared, will be arriving in Canada this winter or this spring.


ENVIRONMENTAL AFFAIRS
Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, in the absence of the Minister of the Environment my question is directed to the Deputy Prime Minister. Last week we brought to the attention of the Government the publication of a U.S. Congressional study with respect to the impact on human health of lead in gasoline. Today we learned about a study undertaken by Dr. Anthony McMichael at the University of Adelaide in Australia to the effect that there is new evidence that exposure to relatively low levels of lead during early childhood can slow and perhaps permanently stifle mental development. Therefore, the question 1 must again ask of the Government is whether it is prepared at last to advance the target date for reducing lead in gasoline from January 1993 to 1990.


Thomas Edward Siddon: Mr. Speaker, I can certainly assure the Hon. Member that the National Health and Welfare experts, as well as Environment Canada officials, are studying the brief prepared by the Canadian Coalition for Lead Free Gasoline with respect to the effect of high lead levels on the health of children. There will be consideration given to a accelerated phase-out if that proves to be necessary.

August 25, 1988
Oral Questions
1 should point out that the program, with the deadline of 1992, to eliminate lead in gasoline, was a program introduced by the Government of which the Hon. Member was a member at the time. Since that time, the safe blood lead level of concern has been lowered from 20 micrograms per decalitre in 1986, to 10 to 15 micrograms now. But we have seen a lowering of the actual levels in children in urban cities to a level of 8 micrograms per decalitre from 12 micrograms which was the level in 1984.
In other words, we are making regular progress and the research to which the Hon. Member referred has certainly been reviewed by officials in the Department of National Health and Welfare and in the Department of the Environment to see if further measures are necessary.


REQUESTTHAT GOVERNMENT ADVANCE REDUCTION DEADLINE
Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, the Minister has pulled out the wrong briefing note. 1 am referring to more recent studies. In view of the fact that the Royal Society of Canada cautioned the Government that the program that is now in place may not be fast enough, is the Government willing to make a decision and advance the deadline for further reduction of lead in gasoline from 1993 to 1990? That is the question the Minister ought to answer.


Thomas Edward Siddon: Mr. Speaker, the Hon. Member may feel I am reading from the wrong briefing note, but my answer to the first question he asked was nonetheless correct. The Government is looking at recent scientific evidence and the report of the Coalition on Lead in Gasoline with a view to determining whether a faster phase-out is necessary. 1 think the Hon. Member would have to agree that it would be irresponsible for a Minister to stand up in the House and promise to change the deadline date of a program his Government established without doing our homework first.


Mr. Speaker:: The Hon. Member for Thunder Bay- Nipigon with a single question, followed by the Hon. Member for Winnipeg North with a single question.


RAILWAYS
Mr. Ernie Epp (Thunder Bay-Nipigon):: Mr. Speaker, my question is directed to the Parliamentary Secretary to the Minister of Transport. Mr. Ian Gillies of the Cargill Grain Company said recently that although it is actually cheaper by over $8 per tonne to ship grain from southern Manitoba to the St. Lawrence terminal elevators than to the West Coast terminals, the federal subsidy paid to railways makes the cost to the shipper over $12 less to rail this Manitoba grain to the West Coast.
Can the Parliamentary Secretary confirm the accuracy of Mr. Gillies' statement which suggests that the railways' subsidies paid under the Western Grain Transportation Act
have a dramatically distorting effect on economic activity in the Canadian grain trade?


Hon. Gerry St. Germain (Minister of State (Transport)):: Mr. Speaker, first, 1 would like to correct the situation. I am not the Parliamentary Secretary. I am the Minister of State for Transport.


Some Hon. Members:: Oh, oh!


Michael Morris Cassidy: Not for long.


Brian Vincent Tobin: Some things are better left unsaid.


Gerry St. Germain: I thank the Hon. Member for having given prior advice of the question. With respect to the Hon. Member's question, as the Hon. Member knows I have met delegations from his riding with respect to the port authorities and the shipping people who work out of and represent that area. We are concerned. His concerns are our concerns. However, the National Transportation Agency will be reviewing the Western Grain Transportation Act in 1989. I believe that it will come forward with recommendations at that particular time in dealing with the situation put forward by the Hon. Member, and we look forward to the response and recommendations with respect to this matter.


PUBLIC SERVICE
David Orlikow: Mr. Speaker, in the absence of the President of the Treasury Board I would like to direct my question to the Deputy Prime Minister. The vast majority of the public servants who are represented by the Public Service Alliance and the Professional Institute know their collective agreements with the Government ran out in 1987. They have been negotiating with officials of the Treasury Board since then. They have not had a single offer in respect to the salary part of their agreement. They have asked repeatedly to meet with the President of the Treasury Board and have been told that she is either too sick or too tired to meet with them.
Would the Deputy Prime Minister make it his business to see that a cabinet Minister who has some authority meets with the representatives of these two organizations so that the bargaining can be brought to a successful conclusion? The fact is that the morale of our employees is going to go down and down unless there is some movement.


Douglas Grinslade Lewis: Mr. Speaker, I wish to advise that the bargaining process is continuing. We all regret that we have not been able to reach a conclusion to the bargaining process, but there has never been a suggestion that the bargaining on either side is continuing in bad faith. I think we should leave it with the officials and with the representatives of the unions, with the hope that very soon they will be able to negotiate a final position and execute an agreement.
August 25, 1988


Thomas Edward Siddon: Point of order.


Mr. Speaker:: Before we get to the point of order, I should like to say Hon. Members have been very co-operative. The Hon. Member for Algoma has a single question and that is the end of Question Period. 1 then must hear the Hon. Minister on a point of order. The Hon. Member for York Centre also has a point of order. And we will get it all done.


AGRICULTURE
Mr. Maurice Foster (Algoma):: Mr. Speaker, my question is directed to the Deputy Prime Minister in the absence of the Minister of Agriculture. It concerns the drought situation which has afflicted southwestern Ontario and other parts of the province. Last month the Minister of Agriculture said that assistance would be provided to eastern farmers on the same basis as those in western Canada where some $153 million was provided to the livestock industry alone. The estimates of losses in Ontario now approach $.75 billion, that is $750 million of losses in crops. I wonder if the Deputy Prime Minister could indicate what assistance is going to be provided and when that assistance is going to be provided?
The Minister of Agriculture failed to show up for a very important meeting a week ago with farm representatives. All the important farm representatives of various organizations are meeting in Guelph today. They want to know when the Government is going to provide assistance and how much assistance is going to be provided in light of the Minister's statement last month.


Donald Frank Mazankowski: Mr. Speaker, I appreciate the Hon. Member's continuing interest in this matter. 1 just want to reassure him, and I think he knows, that no Minister of Agriculture has worked more closely with the agricultural community than the present Minister of Agriculture. In fact, many times the Opposition has condemned him and the Government for consulting with the farm community and working together with them. The Minister of Agriculture had undertaken to deal with this issue. 1 know he is actively working on it, as he has with the drought situation in other parts of Canada, and as he has with other agricultural calamities. I can assure the Hon. Member that he will be dealing with this in an expeditious way and, hopefully, to the satisfaction of all.
Point of Order-Mr. Kaplan


POINTS OF ORDER
Thomas Edward Siddon: Mr. Speaker, the Hon. Leader of the NDP has informed me that, unfortunately, he had to leave the House. It is important for the record that I present to the House updated information received in response to a question, the first question I believe the hon. gentleman asked me earlier during Question Period. I think this information underscores the importance of not extracting from press reports information which later proves to be incorrect and thereby unnecessarily alarming people.


Sheila Maureen Copps: Order!


Thomas Edward Siddon: I think this information is very important to the people of Montreal, if not to the Hon. Member for Hamilton East (Ms. Copps).
The Department of the Environment maintains a register of all inspected and registered dumping sites for PCBs in Canada. That is done in co-operation with the provinces. Notwithstanding that fact, there are still some PCB-filled transformers being used by industry according to policies adopted in 1977 when those transformers were no longer allowed to be installed in new industries and new plants.
There may be in some cases in some locations currently transformers in use which still contain PCBs. That is quite a different situation than having transformers stored that are no longer in service. 1 can assure you, Mr. Speaker, and Members of this House that Air Canada has no PCB-filled transformers operating in any of its facilities in the Montreal area. While it once did have some 29 transformers at Dorval Airport and Five at the Toronto Airport, those were all removed starting in 1986, and have been replaced with transformers of the dry type air-cooled design. All of the PCBs taken from these transformers were shipped outside Canada and sent to a specialized firm in Wales where they were totally destroyed through incineration.
In conclusion, we can assure the House that there are presently no PCBs at Air Canada owned premises in Canada.


REQUEST FOR TABLING OF DOCUMENT
Robert Phillip Kaplan: Mr. Speaker, mine is a very brief point of order. During Question Period my colleague, the Hon. Member for York South-Weston (Mr. Nunziata) questioned the Solicitor General (Mr. Kelleher) about the penitentiary proposed to be built in Harbour Grace, Newfoundland. I recognize that the Solicitor General is not in the House, but he referred to a document which hitherto has not been known about, which is a report that he claimed was received from the Commissioner of Corrections recommending that location. He did not quote from it and I recognize that.

August 25, 1988
Business of the House
However, in light of that revelation can I ask the Government that that report be made public.


Douglas Grinslade Lewis: Mr. Speaker, I would be glad to discuss this matter with the Solicitor General. I think my friend hit the nail on the head when he said that the Solicitor General did not quote directly from the report. However, I will discuss the matter with the Solicitor General.


Mr. Speaker:: I thank the Minister of State. I will also look at the record. If it is appropriate I will come back and report to the House.


Hon. Herb Gray (Windsor West):: Mr. Speaker, I would like to make a brief comment on the point of order of which you have taken notice. I want to suggest that even though the precedents that we have deal with the need to table a document which has been quoted or cited in debate, and that includes Question Period, I respectfully suggest that Your Honour consider making a ruling that if a Minister refers to a report from his officials recommending a course of action and says something about the advice contained in it, there should be an obligation to table the entire report so that Members of the House and members of the public will be in a position to know exactly what was in the report and the extent to which the comment about it by the Minister covers the whole of the nature of the advice and the context in which that advice is given.


Mr. Speaker:: I want to assure the Hon. Member for Windsor West (Mr. Gray), and other Hon. Members, that I have listened very carefully to the intervention. I will consider the matter.
1 point out that this issue was discussed some weeks ago, I think on a matter raised by another very experienced Member in this place, the Hon. Member for Regina West (Mr. Benjamin). I will consider it with care.


BUSINESS OF THE HOUSE
Herbert Eser (Herb) Gray: Mr. Speaker, I want to ask the customary question about the intentions of the Government with respect to the business of the House, this being Thursday. I know that this morning an order was proposed by the Government with respect to the business of the House and it was agreed to. However, there are likely Members who are here now who were not here this morning. I think that in the interest of carrying on a desirable practice I should ask the customary business question and give the Deputy Government House Leader an opportunity to reply.


Douglas Grinslade Lewis: Mr. Speaker, I wish to advise the House that at 3 p.m. this afternoon, or as soon as we finish the
business of the House question, the House will immediately enter Orders of the Day and proceed to consideration of Bill C-146. That is a Bill with respect to the tax courts. This particular piece of legislation will pass through all stages. This, naturally, is on consent. It will pass through all stages without debate and without a recorded division.
The following order of business has been put together with the co-operation of the Opposition Parties. I want to thank them at this time, as I did this morning, for their efforts in this matter.
Immediately after the consideration of Bill C-146 the House will proceed to consideration of report stage of Bill C-139, with the intention that the report stage be finished by 10 p.m. this evening and the vote on concurrence at report stage to be completed this evening.
Tomorrow, we will commence third reading of Bill C-139 and complete that on or before 2 p.m. with the vote being deferred until 6 p.m. on Monday. If in fact we complete that order of business before 2 p.m. tomorrow there would be no further business called by the Government.
Monday, August 29, and Tuesday, August 30, are the two designated days for the third reading stage of Bill C-130, the free trade Bill, pursuant to the order made on August 16, 1988. Any division requested on Bill C-130 shall be deferred until 3 p.m. on Wednesday, August 31, 1988.
Following that deferred division on Wednesday of next week, or as the first item of business on Wednesday of next week, the Government will call Bill C-114, the conflict of interest legislation, for second reading. Second reading of Bill C-114 shall be completed and voted on not later than 5.45 p.m. Thursday, September 1, 1988.
I will stick strictly to business and not to any provisions the order has with respect to the rules of the House. I point out that the House will then adjourn until 11 a.m. on Tuesday, September 13.
One added item I would point out is with reference to the legislative committees which are studying Bill C-136, the broadcasting legislation, and Bill C-144, the child care legislation. If in fact the legislative committees complete their work on these two items there is provision in the Order for the reports to be tabled during the adjournment of the House. They shall be deemed to have been reported and stand on the Order Paper ready for report stage consideration on or after Tuesday, September 13.
It is provided in the Order that the Notice Paper will remain open until 6 p.m. on Monday, September 12, for any amendments thereto. I indicated this morning that when we returned on September 13, in anticipation of the report by the committee on Bill C-136, the Broadcasting Act, being tabled, the report stage amendments being ready and on the Order Paper, that we would proceed with consideration at report stage of Bill C-136.
August 25, 1988

I am advised that the critic for the Official Opposition finds that date to be inconvenient, and I understand that. We will therefore defer consideration of Bill C-136 until Wednesday, September 14, and we will have our staff discuss the matter with the opposition staff. We will discuss it and put together items of legislation for Tuesday, September 13, which meets the convenience of all Parties.


Michael Morris Cassidy: Mr. Speaker, I wonder if the Deputy Government House Leader (Mr. Lewis) could give some guidance to the House with respect to the proposals which the Deputy Prime Minister (Mr. Mazankowski) indicated would be coming forward very shortly. It is the question of political rights for federal government employees.
As the Deputy Government House Leader probably knows, 1 had proposed that if we were to restore to the Order Paper the Bill proposed by the Member for Ottawa West (Mr. Daubney) and make some minor technical amendments to it, that Bill could in fact be put through the House quite quickly. That would be the responsible thing to do.
1 had some misgivings about the proposals and what I understood from the Deputy Prime Minister (Mr. Mazankowski), but could the Deputy Government House Leader indicate if it is still the Government's intention to table such a Bill or is that intention now abandoned?


Douglas Grinslade Lewis: My hon. friend will know that as the Deputy Prime Minister (Mr. Mazankowski) has said, consideration is being given to legislation on political rights, and that consideration is ongoing. As soon as we are in a position to put it into legislation, the Government will come forward with that legislation.


Svend Johannes Robinson: Mr. Speaker, I have another question with respect to House business. A longstanding commitment to correctional officers in federal penitentiaries across Canada remains unfulfilled. That is the commitment on the part of this Government to bring forward legislation permitting early retirement, recognizing the severe stress that many correctional officers face in their jobs within the federal Correctional Service of Canada. The Solicitor General (Mr. Kelleher) is on record as saying that he supports legislation of this nature, but we are still waiting for the Government to bring forward a Bill that would provide for early retirement for correctional officers in federal correctional facilities across Canada.
1 would like to ask the Deputy Government House Leader when the Government will finally bring forward this legislation, and assure him that when the Government does bring it forward, certainly we in the New Democratic Party are
Income Tax Act and Related Acts
prepared to facilitate immediate passage of that long overdue legislation.


Douglas Grinslade Lewis: Mr. Speaker, Question Period, as the House knows, went until 3.10 p.m. today. I consider this to be nothing more than an extension of Question Period. 1, in all good faith, laid out the menu for a considerable amount of days in advance. If that question has to be asked, I suggest that it is for Question Period.



GOVERNMENT ORDERS


Hon. Ray Hnatyshyn (Minister of Justice and Attorney General of Canada) moved: that Bill C-146, an Act to amend the Tax Court of Canada Act and other Acts in consequence thereof, be read the second time and referred to a legislative committee.
He said: Mr. Speaker, I understand that there may be consent to refer Bill C-146 to Committee of the Whole.


Mr. Speaker:: The Hon. Minister is indicating that there may be consent to move directly to Committee of the Whole. Is that agreed?


Some Hon. Members:: Agreed.


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


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, Bill read the second time and, by unanimous consent, considered in committee, reported, read the third time and passed.

[Stage Direction]
The House resumed from Tuesday, August 23, consideration of Bill C-139, an Act to amend the Income Tax Act, the Canada Pension Plan, the Unemployment Insurance Act, 1971, the Federal-Provincial Fiscal Arrangements and Federal Post-Secondary Education and Health Contributions Act, 1977 and certain related Acts, as reported (with amendments) from the Standing Committee on Finance and Economic Affairs; and the amendment of Mr. Garneau:
Motion No. 2
That Bill C-139 be amended in Clause 19
[Stage Direction]
August 25, 1988
Income Tax Act and Related Acts
(a)	by striking out line 7 at page 70 and substituting the following therefor:
"any properly is 2/3 of his capital gain"
(b)	by striking out line 12 at page 70 and substituting the following therefor:
"of any property is 2/3 of his capital loss"
(c)	by striking out line 17 at page 70 and substituting the following therefor:
"the disposition of any property is 2/3 of'
(d)	by striking out lines 21 to 43 at page 70 and lines I to 28 at page 71 and substituting the following therefor:
"years and fiscal periods ending after 1987.'*
Mr. Speaker:: I have a further ruling for Hon. Members with respect to Bill C-139. There are 17 motions and amendments set down on the Notice Paper in relation to Bill C-139, an Act to amend the Income Tax Act, the Canada Pension Plan, the Unemployment Insurance Act, 1971, the Federal-Provincial Fiscal Arrangements and Federal Post-Secondary Education and Health Contributions Act, 1977 and certain related Acts.
Members will recall that on August 23, I promised to return and give a final ruling in connection with this Bill. In my preliminary ruling I found Motion Nos. 1, 2, 7, 14, 15, and 17 in order and ruled that they would be debated and voted upon separately.
I will now deal with the remaining motions.

Motion no. 3 standing in the name of the Hon. Member for Laval-des-Rapides (Mr. Garneau) appears to be attempting to amend the Income Tax Act itself rather than this Bill. However, Clause 39 of the Bill does deal with several aspects of child care expenses and for this reason I will give him the benefit of the doubt. Motion no. 3 will be debated and voted upon separately.
Motion No. 4, again standing in the name of the Hon. Member for Laval-des-Rapides will not be selected as it is similar to a motion moved, debated and negatived in the Standing Committee.
Motion Nos. 5 and 6 standing in the name of the Hon. Member for Ottawa Centre (Mr. Cassidy) are both in order but since the Hon. Member is targetting the same clause in both motions the Chair will only select Motion No. 6 for a separate debate and a separate vote. This decision was made after consultation with the Hon. Member.
Motion Nos. 8, 9, 10, 11 and 12 standing in the names of the Hon. Member for Trinity (Miss Nicholson) and the Hon. Member for Laval-des-Rapides (Mr. Garneau) will be grouped for debate and will be voted upon as follows: (a) Motion Nos. 8, 10 and 12 will be voted upon separately; (b) a vote on Motion No. 9 will apply to Motion No. 11.
Motion No. 13 standing in the name of the Hon. Member for Laval-des-Rapides is in order and will be the object of a separate debate and vote.

Motion No. 16 standing in the name of the Hon. Member for Saint-Leonard-Anjou (Mr. Gagliano) causes the Chair concern as it does not fit in the Bill as reprinted. Furthermore, it appears that the Hon. Member is seeking to amend a section of the Income Tax Act, which has been repealed. This is not in order. In this connection, I refer Hon. Members to paragraphs 1 and 8 of citation 773 of Beauchesne's 5th edition.

To recapitulate, Motion No. 16 has been ruled out of order and Motion Nos. 4 and 5 were not selected.
I thank Hon. Members for their co-operation with the Table Officers in going through what has been a complicated matter and I hope that Hon. Members are satisfied with the result.


Michael Morris Cassidy: Mr. Speaker, on a point of order. I believe the Hon. Member for Winnipeg North Centre (Mr. Keeper) was on his feet at the time the debate adjourned the other day speaking to Motion No. 2.


Mr. Speaker:: Perhaps Hon. Members can assist the Chair. I understand that the Hon. Member for Winnipeg North Centre was speaking. Perhaps the Hon. Member for Ottawa Centre can assist.


Michael Morris Cassidy: Mr. Speaker, if you are moving to debate on the motions, we were on Motion No. 2. If I recall correctly, the Member from Winnipeg North Centre had a certain amount of time left in his speech.


Mr. Speaker:: I thank the Hon. Member for Ottawa Centre.
I recognize the Hon. Member for Winnipeg North Centre.


Mr. Cyril Keeper (Winnipeg North Centre):: Mr. Speaker, I want to reiterate briefly what I said when we were last dealing with this legislation. Quite simply, we are opposed to what the Liberal Party is trying to do today with this amendment by treating the taxation on capital gains even more lightly than the Conservative Government is doing.
We believe there ought to be some equity and fairness in the taxation system for ordinary families. If you continue tax forgiveness on capital gains and not treat those gains as income, the ordinary family will have to pick up the burden, Mr. Speaker.


Mr. Hockin:: Mr. Speaker, I have a brief question. Is the Hon. Member suggesting that he does not support the capital gains exemption for small businesses and farmers?


Cyril Keeper: Mr. Speaker, I want to make it quite clear that we do believe capital gains ought to be taxed with an exception for farmers and small businesses. These are legitimate exceptions. As far as the rest, all other capital gains ought to be fully taxed. In that way income from capital wealth can support public activities and the burden does not have to fall on the ordinary family.
August 25, 1988


Mr. Speaker:: The Hon. Member for Laval-des-Rapides (Mr. Garneau) has, without being formally recognized, brought a matter to my attention which I think must be acknowledged. The Hon. Minister of State for Finance (Mr. Hockin) has with great skill bootlegged a question in which probably was out of order. However, the question is there. The Hon. Member has handled it adequately and with dispatch. We will now continue with debate. The Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) has the floor.


Don Boudria: Mr. Speaker, I was a little confused here by the position of the socialists. They have confused a number of Canadians before on their policy.
I draw to the attention of the House the issue involving the earned depletion allowance on flow-through shares and how the policy flowed through from one position to another at one particular point in the debate, particularly after the Minister responsible for the Bill in question had made a decision. It became apparent in the mining community that it would cause some difficulties. Then we had the situation whereby the Leader of the New Democratic Party (Mr. Broadbent) asked the question, and the tone of his question was in direct contradiction to the statement made by his critic whether the date of the initiative in question had been announced. That was a little confusing and I must say it left a number of us perplexed.


Mr. de Jong:: That is the history of the Liberal Party.


Don Boudria: That is all right, Mr. Speaker. Everyone has a right to be confused and so do the New Democrats.
In the issue we are discussing today, we are hearing from the New Democrats that they do not approve of the Liberal amendment produced by my distinguished colleague, the Hon. Member for Laval-des-Rapides (Mr. Garneau). What he is proposing is a change in the Bill by which change the capital gains and dividends would be taxed in a manner consistent one with the other.
I draw to your attention the November, 1987, report on the White Paper on Tax Reform, Stage 1. That particular committee was made up of Members from all three political Parties. Let me read the list of Members. They are indicated by name and I understand we are supposed to refer to Members by their constituency but, nevertheless, representing the New Democratic Party we had the Hon. Member for Ottawa Centre (Mr. Cassidy), the Hon. Member for Regina East (Mr. de Jong) and so on. I draw to your attention that the report on the White Paper on Tax Reform was adopted unanimously. We are talking about a unanimous report here, Mr. Speaker. Here was the position expressed in the White Paper at Article 11.1 read it-


Michael Morris Cassidy: On a point of order, Mr. Speaker. The Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) is reading from the main body of the report, but he ignores the
Income Tax Act and Related Acts
fact that his Party wrote a minority report dissenting with a number of recommendations of that committee, which is to be read in context with that report, as did the New Democratic Party. He should read on capital gains the New Democrats' contention that with the exception of small businesses and farms, capital gains should be taxed at 100 per cent. If the Member were to read the whole report, he would not be making the error he is making right now.


The Acting Speaker (Mr. McKinnon):: The Chair would be most appreciative that when a Member is standing he waits until the debate is stopped before conducting any further debate.
I do not believe the Member had a point of order the way I heard it, which was faint because the Member's microphone was not on during his discourse. I did not detect a point of order but rather a matter of debate. I will call upon the Member to resume debate.


Michael Morris Cassidy: On the point of order, Mr. Speaker. I simply wanted to make the point that the Hon. Member for Glengarry-Prescott-Russell was misrepresenting a colleague in the House by not citing the minority report in the report of the Finance Committee on tax reform which quite explicitly indicated the New Democratic Party's support for capital gains tax at 100 per cent rates on everything except small businesses and farms. That was the point on which, I am afraid, the Hon. Member misrepresented our Party. He is free to make his points, but I just want to make sure that he does not obfuscate the record.


Mr. Garneau:: Mr. Speaker, I would like to point out that the Hon. Member for Ottawa Centre (Mr. Cassidy) is not raising a genuine point of order but a matter dealing with argument and interpretation. As 1 understood the debate we had in the Committee on Finance and Economic Affairs, of which I was a member, the NDP agreed on that particular point, and what he is doing now is not a point of order but simply a matter of interpretation, and personally I would put a totally different interpretation on the position he took during consideration of the Bill in Committee.


The Acting Speaker (Mr. McKinnon):: I think we have heard enough on this non-point of order and I would like to have the Hon. Member for Glengarry-Prescott-Russell (Mr. Boudria) continue with his debate.


Don Boudria: Thank you, Mr. Speaker, recommendation No. 11 was unanimously carried by the parliamentary committee, as was recommendation No. 12. It is important to note that they were carried unanimously, with the accord of members of the New Democratic Party.

August 25, 1988
Income Tax Act and Related Acts
Recommendation No. 11 was that, as an interim measure only, the proportion of a capital gain or capital loss required to be included in computing an individual's taxable capital gain or allowed capital loss be increased from one-half to two-thirds for gains and losses realized in 1988 and in 1989. Believe it or not, Motion No. 2 strikes out a clause and replaces it with a clause with the figure two-thirds, the very same figure that appeared in the committee recommendation which was unanimously adopted.
There may be a philosophical point at which the New Democrats say they want the whole thing to be taxed differently. Our Party as well thinks that this tax reform would be a lot better had it been done properly. However, the point is that all political Parties agreed that if this tax reform were to take place, we should amend it in such a way as described in recommendation No. 11. Everyone agreed that that was the thing to do, but two political Parties have now changed their minds, the Conservatives and the New Democrats. We in the Liberal Party are consistent.


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


Some Hon. Members:: Question.


The Acting Speaker (Mr. McKinnon):: The question is on Motion No. 2 standing in the name of the Hon. Member for Laval-des-Rapides (Mr. Garneau).
Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mr. McKinnon):: All those in favour of the motion will please say yea.


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


The Acting Speaker (Mr. McKinnon):: In my opinion the nays have it.
And more than five Members having risen:


The Acting Speaker (Mr. McKinnon):: Pursuant to Standing Order 114(11), a recorded division on the motion stands deferred.
The next question is Motion No. 3.


Raymond Garneau: Motion No. 3
That Bill C-139 be amended in Clause 39
(a)	by striking out line 5 at page 106 and substituting the following
therefor:
"63.(I) Subject to subsections (2) and (4),"
(b)	by adding immediately after line 43 at page 109 the following:
"(8.1) Section 63 of the said Act is further amended by adding thereto the
following subsection:
"(4) 26 per cent of the amount deductible as child care expenses under
subsection (1) in computing the income of the taxpayer shall be converted
into a deduction from the tax payable by the taxpayer and the portion, if any, of such deduction that exceeds the tax payable by the taxpayer shall be refunded to the taxpayer."
He said: The purpose of this motion is to make our tax legislation more consistent and to apply the same approach taken in other areas to the area of child care expenses. Mr. Speaker, as you know, all personal exemptions such as deductions for dependants and children have been turned into tax credits, which seemed only fair. In fact, I recommended as much, if I am not mistaken, in my first speech in the House, in response to the first Budget Speech when we were talking about tax reform. I said that it would be fairer and more equitable to turn these exemptions into tax credits, thus setting a fairer value on these exemptions and making them a better reflection of the expenses to be covered. Since tax rates differ depending on one's income bracket, the exemption tended to be more generous to people on high incomes than to those on lower incomes. The Government agreed with this proposal, except that when it got to the matter of child care expenses, instead of transforming deductions for child care expenses into tax credits, the Government maintained the deduction formula.
If adopted, Motion No. 3 would, first of all, transform the deduction into a tax credit. We know that currently, the deduction is $2,000. This Bill will raise the deduction to $4,000 for children up to the age of 6, but only for families who provide receipts. If you hire someone and you have receipts for child care expenses, you can deduct up to $4,000 annually for children up to the age of 6. Before, there was a maximum of $8,000 per family. That will disappear. We know that a family that incurs child care expenses but does not have receipts, or where one of the spouses stays home to look after the children, can obtain a maximum increase of $200 annually of the refundable child tax credit. However, this applies only to families on lower incomes.
I have no problem with this second part of the Act; since it is in keeping with what already existed and the tax credit continues and is refundable, no problem. But regarding the expense deduction, we believe that it would be preferable to have some consistency and keep the tax credit approach as much as possible. And since it is a tax credit that helps families, we believe that this tax credit applicable to child care expenses should be 26 per cent. For example, a family with $2,000 in child care expenses would be entitled to a tax credit of 26 per cent of $2,000; if it has $4,000 in child care expenses, it would be entitled to a tax credit of 26 per cent. That is my proposal. It does not change the ceiling, but simply changes the deduction into a proportional tax credit. Why 26 per cent? Because it would help families with modest incomes more. Under the present tax reform, their income is taxed at 17 per cent. The first $27,500 of refundable income and a 26 per cent tax credit would thus benefit families making $27,500 or less and would change nothing, or very little, for families with more substantial incomes.
August 25, 1988

So I make this proposal for two purposes: first, to keep some consistency in the use of tax credits, since the Government has decided to eliminate exemptions and to change them into tax credits, 1 do not see why this should not be done for child care expenses; second, it would enable families with child care expenses who are in the lowest income bracket to obtain a 26 per cent tax credit for them.


Michael Morris Cassidy: Mr. Speaker, 1 was just given a very sober nod from the Minister of State for Finance (Mr. Hockin). I hope he realizes that it is you, Mr. Speaker, and not he who consents to my being able to speak in the House of Commons.
This motion from the Liberal Party is like the curate's egg. It has some good portions and some that are not so good. The aim is to make the child care deduction into a refundable tax credit at the rate of 26 per cent of eligible child care expenses. This particular clause of the Bill, Clause 39 which amends Section 63 of the Income Tax Act, previously provided for the deduction of child care expenses to the limit of $2,000 per child under seven years of age. This has been raised in the Government's proposals to a maximum of $4,000 per child under seven years of age or a maximum of two-thirds of the taxpayer's earned income. The Liberal amendment proposes that that be turned into a refundable tax credit at the rate of 26 per cent of eligible child care expenses.
The NDP is of the view that we need to make sure child care spaces are available across the country. To act almost exclusively through the tax system as proposed by the Government is not good enough. By increasing the allowable amount from $2,000 to $4,000 we are providing a benefit to wealthy Conservatives who pay nannies to look after their children and then deduct the entire amount. Or, perhaps they are wealthy enough that they can pay for day care at full rates. However, there are an awful lot of people who do not have that kind of money.
In addition, like it or not, there is an informal child care network which has grown up because of the lack of more formal facilities. In that network it is not always possible to get receipts. If you do not get receipts, you do not get a credit. In addition to which, the wealthier you are, the more this $4,000 per child deduction is going to be worth. A secretary earning $20,000 a year who pays $4,000 or $5,000 for child care will be able to get a credit only at the rate of 17 per cent of that amount. It is worth about $680 to her, or about $15 a week. On the other hand, the wife of a company president who has a job as a co-ordinator in some company or something like that and is making $50,000 a year will have a marginal tax rate of 29 per cent, and the $4,000 or more her family spends on child care will be worth $ 1,200 to her.
We will support the Liberal amendment even though we have grave misgivings about this $4,000 which the Liberals choose not to interfere with, because the principle is that the
Income Tax Act and Related Acts
child care deduction should not be a deduction but a credit. It should be at the rate of 26 per cent, which is equitable as between the person earning $20,000 a year and the person earning $50,000 a year. It is for that reason that we support this amendment.
I do want to say, however, that this is a minor improvement and, as my colleague from Vancouver East (Ms. Mitchell) will say, it is not an adequate solution to the problems faced by such a large number of working women and families across Canada which have not been responded to adequately by the Conservative Government.


Margaret Anne Mitchell: Mr. Speaker, I would just like to make a few additional comments. I think my colleague, as usual, has described most accurately and eloquently our concerns.
I would like to point out again that we feel very strongly that the Government's child care strategy, which would double the deduction for child care expenses, would cost a total of $2.3 billion, including the $200 child tax credit, and this would come out of the child care budget over the next seven years. That is a considerable amount of money. Our position is that it would go a long way to increasing considerably child care spaces which are the first priority across this country. It would mean that instead of many of the parents who now either do not have receipts for informal baby-sitting arrangements or have no alternative but to use unlicensed baby-sitting arrangements, would then have in their community licensed child care. If that amount of money were put into the child care system it would mean fees would be reduced and the cost of child care would not be as high.
As my colleague pointed out, this measure helps only those who pay taxes. For many mothers on welfare or with very low incomes it really will not be helpful and they are the ones that should be given priority in any money that goes into the child care system.


Thomas Hockin: Mr. Speaker, I think I should take a moment to give my reaction to the motion put forward by the Hon. Member for Laval-des-Rapides (Mr. Garneau). We have in tax reform an approach which is quite different philosophically from what he is suggesting when it comes to credits. We have eliminated deductions for things such as the married exemption, or equivalent to married exemption, child tax exemption, family allowances and so on, and turned them into credits. The Minister of Finance (Mr. Wilson) has explained many times the reason for this. In this particular case the Hon. Member is essentially saying that expenses incurred to earn income should be reflected in a credit, not as a deduction. It is a technical point, really, but that is not what we are doing in tax reform. When you incur expenses to earn income, including the expenses of child care, they should be deductions, not credits. That is really what is behind what we are doing here.

August 25, 1988
Income Tax Act and Related Acts
The federal revenue loss on this proposal would be at least $100 million. The impact of providing a credit of 26 per cent represents that revenue loss. This would be in addition to the new child care initiatives which will cost the federal Government $380 million annually through the doubling of the child care expense deduction from $2,000 to $4,000, and the increase in the child tax credit by $100 in 1988 and $200 in 1989 and subsequent tax years for children under seven years of age. The Hon. Member was striving for consistency in his motion but the point is that if we adopt the motion we would be inconsistent with the whole philosophy of credits as compared to deductions for expenses in earning income, of which child care is one.


Mr. Alfonso Gagliano (Saint-Leonard-Anjou):: Mr. Speaker, I would of course like to support Motion No. 3 presented by my colleague from Laval-des-Rapides (Mr. Garneau).
The very basis of this tax reform was to convert deductions into credits so as to make the system fairer and more equitable. That is why my colleague from Laval-des-Rapides proposes that under tax reform, child care deductions be made into tax credits.
1 find the argument of the Minister of State for Finance (Mr. Hockin) interesting. He states the Conservative Government's philosophy on child care deductions and considers them ... he lumps them with the other deductions. Until 1987, personal exemptions and everything else that have now been changed into credits were taken as deductions. He justifies not making child care deductions into credits by saying they are an expense to earn income. That is the crux and that is what this Conservative Government does not want to recognize... Today, society has changed; keeping a family is not an expense to earn income. For most single-parent families and even for families where both parents work, it is essential; it is a personal deduction like the personal exemptions and all that. I think that they should be made into tax credits, because it is fairer.
So today while the Minister wants to justify them as deductions rather than credits, the child care expense deduction should be treated in the same way as the other deductions that were changed into tax credits, to be fair and equitable, because it is a personal expense and a necessity today. Single parents have to go out and work and even in families with both parents, they have to work to balance the family budget. So the Government should review its position and support this motion to correct the social injustice it is creating by maintaining the deduction instead of abolishing it.


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


Some Hon. Members:: Question.


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


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mr. McKinnon):: All those in favour of the motion will please say yea.


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


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


Some Hon. Members:: On division.
Motion (Mr. Garneau) negatived.


Michael Morris Cassidy: Motion No. 6
That Bill C-139 be amended by deleting Clause 78.
He said: Mr. Speaker, Clause 78 deals with the elimination of the $1,000 investment income deduction under the Government's proposal for tax reform. I do not think any single issue has provoked more comment and concern than this, with the possible exception of the change in treatment of automobile expenses, which provoked a great deal of reaction at our hearings from small businesses and people directly affected such as travelling sales people.
The reason this proposal provoked concern is very simple. The $1,000 investment income deduction was a tax privilege available to people on modest incomes, particularly senior citizens. I think that when the Government chose to eliminate that it did not see the essential unfairness of the system it was creating. On the one hand, it gave a $100,000 tax free exemption on capital gains income which would, of course, go for the most part to wealthy Canadians. One-third of all capital gains in the country go to the 1 per cent of taxpayers with the largest incomes.
In the changes to the tax rates the Government actually brought taxes down on only one group compared to 1984. The people affected are those who earn about $100,000 a year. They pay less than in 1984, but everyone else pays more because in the interim between 1984 and the present the Conservatives have systematically been increasing taxes on average Canadians by a number of different means. The consequence is that, even after changes brought in under tax reform, average Canadians are paying more.
August 25, 1988

In addition to that, there are a number of privileges which have been left for corporations and a number of privileges which are accessible to people who are well off, well connected, or have various types of business enterprises. Yet, the Government chose to sweep away the $1,000 investment income deduction.


Thomas Hockin: You are arguing for the rich.


Michael Morris Cassidy: I am arguing for average Canadians. If the Minister of State for Finance (Mr. Hockin) would like to propose an amendment to our amendment which would confine this investment income deduction to people with an over-all income of less than $30,000 or $40,000 a year, 1 would be happy to see that as an elaboration on the proposal I am making.
The amendment is to repeal the clause proposed by the Government which, in turn, repeals the $1,000 investment income deduction. In parliamentary terms it seemed that that was the most straightforward way to do this. I had prepared a somewhat more complex amendment. I consulted with the Clerks and in the wisdom of the Speaker he has chosen simply to accept an amendment from the New Democratic Party to repeal the clause completely.
If the Minister of State for Finance believes that it goes too far and believes that the investment income deduction should not be given to people earning over $30,000 or $40,000 a year, I can say that I agree with him. I would be happy to cooperate. We could stand this clause and he and I could go behind the curtains to discuss it. He need only indicate that and I am sure the House would be prepared to give its unanimous consent for us to work out an amendment jointly to bring this back in a way that he proposes, because that is not a bad suggestion.
The people who are particularly affected by this are senior citizens, people who have put a few dollars aside in Canada Savings Bonds, in RRSPs, or on deposit in Guaranty Trust, or people who have perhaps inherited a handful of shares in Bell Canada which give them an income of $500 or $800 a year. It is not a great deal but it is a part of their provision for their old age. This is who is hit particularly by the repeal by the Government of the investment income deduction, and that is why I am proposing, on behalf of the New Democrats, to put it back.
If the over-all tax system was fair, if there had not been concessions to people who are wealthy, if there had not been this very large tax-free zone on capital gains, again to people who are wealthy, it might be acceptable for the Government to tell senior citizens that everyone has to make a few sacrifices and that the investment income deduction has to go because that is part of the give and take, part of the trade-offs which occur with tax reform.
1 have learned a great deal about tax reform and tax policy in the course of the last year as a member of the Finance Committee studying this particular issue. In fact, both my colleague from Regina East (Mr. de Jong) and I would
Income Tax Act and Related Acts
probably agree that we have learned more than everything we ever wished to know about tax reform in the course of the last year. One of the things I have learned is that people do have an essential sense of justice.

People on modest incomes, and senior citizens are one example, see that the Goverment has eliminated the annual $1,000 investment income deduction while it gives a $100,000 tax-free exemption on capital gains income to Canadians who are rich or in any case well-off. They see that the Government has reduced taxes by $4,300 annually for taxpayers with an annual income in excess of $100,000, while people on modest incomes, like senior citizens and people with an annual income of $15,000 to $20,000, get a tax reduction of about $2,000 and maybe not more than that.
Add to this the de-indexation introduced as part of this tax reform, which means that even tax deductions received by those who are not well-off, by people on modest incomes, will disappear within three or four years.
Mr. Speaker, this is why senior citizens' organizations brought their requests and proposals before the Committee on Finance which examined this Bill, urging the Government to maintain the $1,000 investment income deduction. As far as I am concerned, it should do so until we have a tax system that is truly fair and equitable.
The Minister of State for Finance suggested that instead of giving this tax concession to everyone, we restrict it to those people with an income of less than $30,000 or $40,000.
Mr. Speaker, I accept the suggestion made by the Minister of State (Finance) (Mr. Hockin), and I suggest that two minutes from now, after I finish my speech, we both go behind the curtains and, with the help of his officials, draft a new amendment for this section which would re-instate the investment income deduction for persons on modest incomes, restricting this concession to taxpayers with an annual income of less than $30,000.
We on the New Democratic side are prepared to accept this proposal. It is a good one. But to give the rich all kinds of concessions, to reduce corporate taxes by about 6 per cent, which represents a big drop in taxes for many corporations in this country, while at the same time depriving taxpayers on modest incomes of the few tax concessions they have left-it just is not fair, it is not equitable and we cannot accept that.
Mr. Speaker, I moved this amendment to the clause to eliminate the Government's proposal and to re-instate that part of the Income Tax Act that provides this concession, that allows the $1,000 investment income deduction. This is mainly for taxpayers on modest incomes. Mr. Speaker, it is a tax concession for people who are rich, and for them it should not exist, 1 agree. But compared to the other concessions made to the rich, this one has no impact on their investment activities. However, it is very important to the average taxpayer, and these are the people we want to help with this amendment.

August 25, 1988
Income Tax Act and Related Acts


Thomas Hockin: Mr. Speaker, the Hon. Member's motion is perverse in the extreme. First, what he is suggesting would literally dry up all the major sources of charitable contributions in the country. It would be an absolute disaster for almost every charity that Members of Parliament care about. It would result in putting yet more burdens on the Government and further centralize decisions on matters of that sort. I cannot believe the House would even tolerate the implications that are inherent in the Hon. Member's motion.
As for the $1,000 investment income deduction-


Michael Morris Cassidy: Mr. Speaker, I rise on a point of order. The Minister knows that the amendment as I originally proposed it would not have touched other provisions relating to charities. It was the Speaker who chose the amendment as it is being considered here today. The Hon. Minister knows that it was not the intention of the New Democratic Party to eliminate that other part of what is in the Bill.


The Acting Speaker (Mr. McKinnon):: I do not find that to be a point of order. The Hon. Minister.


Thomas Hockin: Mr. Speaker, I was speaking to both motions. 1 want to deal with the $1,000 investment income deduction. The Hon. Member is trying to make a point that was made early on in tax reform but has been subsequently clarified very well by the Minister of Finance (Mr. Wilson). I think most Canadians understand that the original concern about the $1,000 investment income deduction is groundless because when one puts that measure in the wider context of tax reform, it results in reasonably good news.
The reintroduction of the $1,000 investment income deduction would cost the federal Government $1 billion. Who would that help?
While removing the deduction, we have offset it by providing higher personal credits for all Canadians. It is elderly Canadians who wrote us early on in tax reform in order to understand the policy. For most elderly filers, the loss of the $1,000 investment income deduction has been more than fully offset by a higher personal credit of $1,020 and the age credit of $550. These changes were most advantageous to those in lower tax brackets, for whom the age and basic credits yield much greater reduction in tax than did the old exemptions and the $1,000 deduction.
The answer is to put the issue into the whole context of tax reform. This is what we are doing successfully, and Canadians understand it.
It is only wealthy taxpayers who would argue like the Member for Ottawa Centre (Mr. Cassidy) that this should be restored, because only for wealthy taxpayers will the elimination of the $1,000 investment income deduction in conjunction with conversion from deductions to credits result in an increase in tax. That is why his motion argues against what he claims is his very motivation in the first place.
I should read into the record the kinds of tax reductions for seniors that are occurring under tax reform. A single senior with income of $15,000 has a tax cut of $105, which is 7.6 per cent of tax. For a single senior with an income of $20,000, the tax cut is $235, which is 8.2 per cent as a percent of tax. The tax cut for a single senior with an income of $25,000 is $435, which is a 9.9 per cent tax cut as a percent of tax.
The tax cut for married seniors with an income of $15,000 is zero, but for those with an income of $20,000 it is $575, which is a 67.3 per cent tax cut as a percent of tax. Married seniors with an income of $25,000 have a $655 tax cut, which adds up to a 28.8 per cent tax cut as a percent of tax.
Our approach is very progressive. The whole credit approach is especially helping our elderly and those with low income. We are proud of that element of tax reform.
Even though we are invited to step behind the curtain to look at another solution, we have looked at it carefully and are very proud of what we have produced because it is progressive. It is not regressive, which is the ultimate implication of the motion of the Hon. Member for Ottawa Centre.


Alfonso Gagliano: Mr. Speaker, 1 welcome the opportunity to speak to this motion. First of all, I disagree with the Government's position which is to abolish the $1,000 investment income deduction. Today, we are reminded of our senior citizens, of the neediest in this country and of those workers who have managed to accumulate a few savings. The deduction for the first $1,000 in investment income meant that they did not have to pay income tax on the interest earned. This partly compensated for inflation, which is still 4 per cent annually, so it was a form of protection for their meagre savings.
Personally, Mr. Speaker, I would have liked to deal with this matter in a tax reform plan that would make our tax system fair and equitable. We would have introduced a tax credit formula enabling small investors to avoid paying income tax on the first $1,000 of their investment income. Since the basic tax rate is 17 per cent, it would have been very easy to provide a tax credit of up to $170 per year, and this for all those who qualified for the basic tax rate of 17 per cent. This would have maintained a tax credit for low-income Canadians. That is the kind of solution I would have liked.
August 25, 1988

On the other hand, Mr. Speaker, 1 support the position of the New Democratic Party, and I support this motion on the principle that we cannot afford to have a double standard in our tax laws.
The Minister of State (Finance) said earlier that the Government was generous and that while eliminating this, it was providing higher tax credits that applied to everyone. However, it maintained the $100,000 capital gains exemption. People who are in position to claim the capital gains exemption will certainly take advantage of the personal tax credit to which the Minister of State (Finance) referred to earlier.
Mr. Speaker, we cannot afford to have a double standard. Since the Government has decided to provide a $100,000 capital gains tax exemption, I think the least it can do is let taxpayers who are not in a position to take advantage of that exemption to keep the $1000 investment income deduction. As I said before, for the sake of fairness I would have preferred to see a maximum tax credit of $170, since the first tax bracket is taxable at a rate of 17 per cent. However, since the Government has decided to ignore completely the low-income bracket of Canadian taxpayers, I intend to support the motion to abolish this clause and maintain the $1,000 investment income deduction.


David Orlikow: Mr. Speaker, I want to support the amendment moved by my colleague, the Hon. Member for Ottawa Centre (Mr. Cassidy). I say to the Minister of State for Finance (Mr. Hockin) that 1 have received a substantial number of letters from senior citizens in Winnipeg who object very strenuously to the proposal of the Government to remove the exemption of interest up to $1,000. These are retired people living on modest incomes and they just do not accept the view expressed by the Minister of Finance of State for Finance a few moments ago. He tried to tell us how much people will save because of the Government's tax proposals this year. But what he did not tell us was that for the first three years of this Conservative Government, income taxes were raised and sales taxes and excise taxes were raised, so in fact this year's reduction goes only part way in decreasing the increases implemented by this Government which hit all Canadians, particularly senior citizens.
Members of our Party have consistently proposed that the tax system be examined and revised and made much more fair than it is. The Carter Commission, appointed by former Prime Minister Diefenbaker, made it clear that the tax system had been changed so many times and so many special exemptions had been given to corporations and wealthy individuals, that it was completely broken down in terms of being fair. When this Government started to talk about implementing a fairer tax system, a reform of the tax system, as it was called, we watched with a great deal of interest to see what would happen.
Income Tax Act and Related Acts
I want to give one illustration of what has happened to one very wealthy individual in this country as a result of the tax policies of the former Liberal Government and the present Conservative Government. I refer to Mr. Robert Campeau. He was quoted in a news story which appeared in The Globe and Mail on May 12, 1988. It reads:
"He told the Canadian Club of Montreal that Canada's deficit is 7 to 8 per cent of gross national product, compared with only 2.5 per cent in the United States. And he said Canada's Government-supported medicare is a mistake.
"I question whether politicians, federal or provincial, who put in medicare were really thinking of the welfare of the people, or were they, perhaps, thinking of their own political welfare."
The article concludes:
He lashed out at the regulatory burden business faces in Canada and demanded that social welfare programs be examined and rationalized.
Let us look at Mr. Robert Campeau. In the 1960s, he was a developer and builder of houses. He owned 4,000 acres of land around Ottawa and had built 11,000 homes. In the years since then, he was able, by contracts given to him by Liberal governments, often without the Government calling for bids, to build and then rent to governments some of the largest office buildings in the National Capital Region. According to information obtained by then Conservative Members of Parliament, including the late Walter Baker, Ron Huntington from Vancouver and the present Minister of National Revenue (Mr. MacKay), when they were in opposition, the rents agreed to were substantially higher than the going rates in the area.
The Guy Favreau complex in Montreal, the largest government building in Montreal and perhaps the largest in Canada, was built by Mr. Campeau through a lease and buy-back arrangement with the then Liberal Government. The present Auditor General described it as one of the most wasteful federal projects he had ever seen. According to the Montreal Gazette yesterday, the rent on the building is just under $1 million a month, and bricks from the walls are falling. According to a senior official in the Department of Public Works, all the bricks on the building may have to be replaced.
Using the profits Mr. Campeau was permitted and encouraged to make in Canada, he entered the United States and has become one of the most active and successful developers in the United States. He is now operating in the multibillion dollar class. How was he able to do it? Partly because of the favourable contracts he received from Liberal governments, but also because of the kind of tax system we have.
We did a search and found that from 1978, which was the earliest information we were able to find, to 1985, net profits for Campeau Corporation totalled more than $125 million. Yet, according to The Financial Post data, in 1978, the company paid no corporation taxes at all. In fact, it received a tax credit. Since then it has not paid one penny in current taxes.

August 25, 1988
Income Tax Act and Related Acts
Every one of the years from 1978, on have been profitable years for the company. From 1985, alone, the company recorded net profits of $27.9 million, yet no taxes were paid. The company was able to defer $24.3 million in corporation tax. In fact, the deferred corporation taxes which this company has accumulated amount to $141.8 million as of the end of 1985.
Mr. Campeau got started in the years that the Liberals were in office. We are now four years down the road from that time. We have had four years of Conservative Government. We have had four years of talk about fairer taxes. We have had four years of talk about reforming the tax system. We have had four years of talk about a minimum corporation tax.


John Barry Turner: There are now more jobs and lower interest rates.


David Orlikow: Mr. Speaker, I hope the comments of the Hon. Member for Ottawa will be recorded in Hansard. He is obviously prepared to let corporations pay no income tax and wealthy Canadians pay no income tax as long as jobs are created. The seniors whom that Member represents, like the seniors I represent, resent the fact that they have to pay income taxes on relatively modest incomes. Many of them live in poverty and have to pay income taxes, while people such as Mr. Campeau and corporations like his and many others pay no tax at all. 1 am happy that the Hon. Member from Ottawa interjected. I think the people of Canada want to know who stands for a fair tax system. It is obvious that the Conservative Government and the Conservative Party do not.


Claudy Mailly: It would be false to say that the removal of the capital gains tax or a measure to permit deductions for capital gains tax of up to $100,000 in a lifetime is helping the rich. It is helping farmers. It is helping young people who want to take over their parents' farms. It is helping small business, men and women. There are more and more women in small business now. In one lifetime they will be allowed not to pay taxes on $100,000 worth of capital gains. That is not a fortune. They pay taxes on the property when they buy it. They pay taxes on their revenue over the years which comes from owning their land.
It is unfair to define affluence in that way. It is also unfair to cloud the whole issue of tax reform in this emotion and to let people think that the Canadian Government is not helping those who need it most. That is what tax reform is all about. You cannot take one part out and say, "I like this but I don't like that, because it affects me and I want it to affect my neighbour". So it has to be looked at as a package, which is what the Minister of Finance has said all along.


Simon Leendert de Jong: Mr. Speaker, I, too, wish to enter into the debate on the amendments as introduced by my colleague. It is unfortunate that the Parliamentary Secretary for the Minister of National Revenue (Mrs. Mailly) did not really understand the point that both of my colleagues, the Member for Ottawa Centre (Mr. Cassidy) and the Member from Winnipeg tried to make. In essence, the point that they were trying to make was that the tax system as it exists helps those with very high incomes, helps the very rich, whereas those exemptions that are of significance and importance to middle and to lower middle income earners have been removed, and the unfairness of the tax system continues to exist.
While I agree as well with the Member for Ottawa Centre, it is with a certain amount of hesitation that we introduce the amendment. If we really had a fair tax system, one that would consider a dollar is a dollar is a dollar, as far as tax purposes are concerned, then, to give special exemption for interest earned would not fit. A dollar in interest surely should be considered as a dollar in profit, which should also be considered as the same as a dollar in dividends or a dollar earned as a wage or a dollar increase in the capital gains.
Unfortunately, this Government has refused to accept the notion of a dollar is a dollar is a dollar when it comes to tax policies. So that a dollar earned through a capital gains increase is treated quite differently from a dollar that is earned by a wage earner or a dollar that is earned in terms of dividend payments.
We are saying that as long as these inequities exist in the tax field, we are darn well going to fight to help those, particularly senior citizens, who stand to lose their $1,000 exemption from interest earned.
The Minister of State for Finance (Mr. Hockin) has attempted to put on the record the great benefits that senior citizens have received because of tax reform. Of course, he is
Income Tax Act and Related Acts
very selective in terms of comparing taxes paid in one year as compared to the next year. Of course, what the Government insists on doing, in attempting to show that seniors and other taxpayers are saving money because of tax reform, is to compare the taxes that they paid in 1987 to what they will pay in 1988 with tax reform. Lo and behold, yes, many of them will be paying less.
If you can compare it to 1984, when this Government was elected, those taxpayers are all paying more, and that is the truth of the matter.
The taxes that they are paying, both on income tax and on sales tax, have increased because of this Government. The Government as well fails to mention that even when the taxes paid from 1977 to 1988, are compared, the taxes that the average Canadian tax earner is paying on the goods and services that he is buying are, of course, not included. One of the things that this Government did when it introduced tax reform and lowered the rates on income taxes paid, was to have also increased the sales taxes to make up for the loss in revenue.
So, yes, you have seen a decrease in the income tax that you have paid, but you have also seen an increase in the taxes that you pay every time that you buy a chocolate bar, some clothes, a gallon of gasoline or whatever it may be. This Government is now taxing you in a way that Canadians have never been taxed before. That of course is the first year. If this Government is ever re-elected, the second shoe will drop. That will be a universal sales tax, in which everybody going for a haircut or a shoe shine or going to the dentist will also be taxed on whatever goods or services they will be purchasing.
When this Government talks about the benefit of tax reform to the seniors, it takes a very narrow view in trying to establish its case that seniors are better off. If you take an honest view, if you compare what the seniors and the average Canadian taxpayer is paying, both in income tax and in sales tax in 1984, when this Government was first elected, and what they are paying now under the so-called tax reform, in 1988, you will find that the average Canadian taxpayer of course pays substantially more.
The Minister of State for Finance wanted to present the case that tax reform was very progressive. He showed the amount of decrease and taxes paid by various groups, those earning $15,000 or less per year, those earning $20,000, those earning $25,000, single and married couples and so forth, and he presented us with figures. In some groups, we will even save up to $655 per year in income tax. But then he stopped with that group. He did not go on and he did not mention, for example, that there are 180,000 Canadians earning $100,000 and more per year that will be saving some $4,165 in income tax.
The Hon. Member, the Tory across the way, says, "Wouldn't that be too bad?" From his perspective, that is not bad at all. In fact, that is great. But from the point of view of

August 25, 1988
Income Tax Act and Related Acts
progressivity and fairness in the tax system, yes, it is bad. It means that under the Tory tax reform, if you are earning $100,000 and more per year, you are going to be saving over $4,000 in your income tax, but if you are earning some $25,000 a year, you are going to be saving some $435 in income tax. That is not progressive and that is not fair, and that is why Canadians generally have been somewhat lukewarm in their treatment of tax reform. Certainly, it has not produced the support that I think this Government was hoping it would produce.
Therefore, I think that the motion presented by my colleague that calls for the retention of the $1,000 investment and income tax exemption is a good one. It helps seniors. If the Government is interested in ensuring that seniors and those with middle income are the ones who will benefit, as my colleague has stated, we are willing to go behind the curtain and work with the Government for a proper amendment to put an income ceiling, if that is the wish of the Government. But otherwise, I think the amendment should be carried and the seniors of this country in particular should continue to enjoy the $ 1,000 exemption.


Abram Ernest Epp: Mr. Speaker. 1 appreciate the opportunity to join briefly in the debate on Motion Nos. 5 and 6 that were put forward by my colleague from Ottawa Centre (Mr. Cassidy).
I want to focus particularly on his proposal that the $1,000 interest and investment income exemption in the income tax be continued. I want to do that on behalf of many of my constituents who have called me and have written to me about the kind of taxation that they have faced in the last year or two.
I remember how in the spring of 1987 many of the seniors looked at their income returns and considered the limited incomes that many of them have, perhaps with a pension plan and some investment income that they had received and had been able to build up over the years-not a great deal of money in many cases-enabling them to have a reasonably decent retirement. It allowed them to lead the kind of life that all of us are proud of having been able to achieve for senior citizens over the last 10 or 15 years, a good part, of course, because of the indexation of the old age pension which this Government tried, within a year of its election, to limit, not to do away with it completely.
These senior citizens found themselves over a year ago being hit with taxes. The taxes were not necessarily a great amount but the seniors were shocked that, their incomes not being very large and needing every cent to maintain themselves, they were having to pay tax. 1 have been sent by one or two constituents quite detailed statements of the kinds of incomes they had had for several years past. Their incomes had not improved markedly, probably had not kept up with inflation. But these senior citizens had paid very little, if any, tax until a year or
two into the life of the present Government and then there they were having to pay tax.
This is the experience of individuals and couples in Thunder Bay like those in every city and town and community across the country, that under this Minister of Finance (Mr. Wilson) the Government has been wringing out of individuals, middle and lower income Canadians, every cent of income tax possible. The Government has done that without being prepared to recognize that the pressure for revenue ought to make for tax fairness, for applying to corporations something halfway like the kind of brutal search for revenue that has been applied to lower income Canadians and the poor of this country who should not have to pay tax at all.
That is the context and the background against which we consider whether the $1,000 investment and interest income exemption should be continued or removed. The Minister of Finance knows that the Government of Canada needs revenue for all kinds of purposes. He has been cutting back in many areas and not living up to the challenges that face the Government. He has been niggardly with financing of post-secondary education and health care. The Minister, who knows how much he needs income, should have remembered about the $500,000 capital gains tax holiday he gave some Canadians in his attempt to make more millionaires, as he suggested a couple of years ago. If he had been fair and treated every dollar like every other dollar, putting the burden fairly everywhere to raise the revenue he wanted, senior citizens and persons who have built up some investment and drawn income therefrom should not have been touched. But when the boots have been put to lower and middle-income Canadians the way they have by this Government as I have described, it is unconscionable and absolutely unfair to take away the $1,000 interest income exemption as the Minister of Finance proposes to do.
It is those human reasons that involve the lives of seniors in my city, persons who have built up a certain amount through their own savings over the years, who deserve to enjoy the income from small investments. If the Minister of Finance is not going to be fair about it, let us continue that exemption and allow seniors to enjoy the fruits of their savings and of denying themselves in the past in order to build up these investments.
I feel very strongly the political necessity of the motion put forward by my friend, the Hon. Member for Ottawa Centre.


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


Some Hon. Members:: Question.


The Acting Speaker (Mr. McKinnon):: All those in favour of the motion will please say yea.


Some Hon. Members:: Yea.
August 25, 1988


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


Some Hon. Members:: Nay.


The Acting Speaker (Mr. McKinnon):: In my opinion the nays have it.
And more than five Members having risen:


The Acting Speaker (Mr. McKinnon):: Pursuant to Standing Order 114(11), the recorded division on the proposed motion stands deferred.
Shall we call it five o'clock?


Some Hon. Members:: Agreed.


The Acting Speaker (Mr. McKinnon):: It being five o'clock, the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper.



PRIVATE MEMBERS' BUSINESS-BILLS

['Agreed.']
The Acting Speaker (Mr. McKinnon):: 1 have received written notice from the Hon. Member for Outremont (Mrs. Pepin) that she is unable to move her motion during Private Members' hour on Friday, August 26, 1988. It has not been possible to arrange an exchange of positions in the order of precedence pursuant to Standing Order 39. Accordingly, I am directing the Table Officers to drop that item of business to the bottom of the order of precedence.
Since notice will be removed, the hour for Private Members' Business tomorrow will be cancelled and, pursuant to Standing Order 39, the House will continue with the business before it prior to that hour.



Gordon Edward Taylor: that Bill C-205, an Act to protect heritage railway stations, as reported (with amendments) from a legislative committee be concurred in.


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


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.
Gordon Edward Taylor: that the Bill be read the third time and passed.
He said: Mr. Speaker, it gives me the greatest of pleasure to move third reading of Bill C-205, an Act to protect heritage railway stations. Amended in a legislative committee, this Bill
Heritage Railway Stations
was presented to the House on July 15 by the chairperson of that committee, the Hon. Member for Leeds-Grenville (Mrs. Cossitt).
The significance of railways in shaping our nation's destiny cannot be denied. Railways brought Canada into existence and, in large part, they have defined our fundamental character. Because of Canada's size, geographical diversity, dependence on trade and the twin needs of settlement and political identity, transportation has been of vital importance to us. It is above all railway transportation which has been the very backbone of our nation. It is the railway station that remains the most cherished of the tangible reminders of what Canada's railways have meant to Canada and her people.
These stations were points of departure and arrival for thousands of families as they travelled on odysseys of settlement across our enormous country. They saw the farewells of tens of thousands of Canadian troops who went off to fight in four wars, and they were the first thing that those who returned saw when they came back home. Railway stations have been the scenes of millions of journeys undertaken by Canadians from all walks of life, and they figure in the memories of millions of Canadians. So the distress of Canadians when these stations are destroyed is completely understandable. We will be a poorer nation if our railway stations are lost.
Railways were our "national dream", and the heritage of our railways is the heritage of that dream. It has often been said that a nation will be judged by what it consciously chooses to preserve. Therefore, should not Canada strive to save examples of the very buildings that speak so eloquently to the role of the railway in the birth and the growth of this country, our heritage railway stations?
The answer is undeniably yes. But we must move quickly. Our stock of heritage railway stations is rapidly diminishing, and if nothing is done soon there may be nothing left to preserve. That is the purpose of the Bill currently before us, to provide a mechanism whereby the preservation of Canada's heritage railway stations may be assured.
This Bill would forbid a railway company from destroying or in any way altering a heritage railway station or its heritage features unless authorized by the Governor in Council. Failure to seek authorization would result in a fine.
What is a heritage railway station? This Bill defines a heritage railway station as a railway station designated as such; that is to say, a railway station that has been designated a heritage railway station on the recommendation of the Historic Sites and Monuments Board of Canada.

August 25, 1988
Heritage Railway Stations
Here may 1 say that the Historic Sites and Monuments Board of Canada is most interested in this Bill. The board has often expressed concern that our railway stations are disappearing. While this Bill, when passed, will add new responsibilities to those which it has had traditionally, the board has indicated that it is pleased to have a role to play in the identification and preservation of Canada's heritage railway stations. The board will move quickly to establish criteria to identify potential heritage railway stations so that it may deal with applications for designation in an effective and timely manner.
Now, if 1 may, I would like to say a special word of thanks to those who have made special contributions to Bill C-205, the Bill before us today. First, the former Hon. Member for Parkdale-High Park, Mr. Flis, first introduced the Bill in 1984. There are the Members of this House who, during the course of debate on this Bill, spoke so movingly of the need to preserve heritage railway stations, those stations that are so close to the hearts of so many Canadians.
Beyond that, I would like to thank the chairperson of the legislative committee, the Hon. Member for Leeds-Grenville (Mrs. Cossitt) and the members of her committee, for the thoughtful and expeditious manner in which they dealt with this extremely important matter. I believe that the amendments resulting from committee consideration of Bill C-205 have strengthened the Bill in that they have addressed a number of technical difficulties, provided for clarification and will ensure ease of implementation of the Bill.
1 also want to say a special thank you to the Parliamentary Secretary for the Minister of Transport (Mr. Thacker) and to the Hon. Member for Regina West (Mr. Benjamin). The Hon. Member for Regina West worked so hard for this Bill that sometimes I wondered if it was not his Bill, he was so enthusiastic about it. I thank him for that enthusiasm and that hard work. I would also like to thank the Heritage Canada Foundation, the very life of which depends on heritage. The Foundation has done a tremendous job in supporting this Bill.
I would like to thank CP Rail, CN and VIA for appearing as witnesses, as did the Heritage Canada Foundation, before the committee and the Ministers of the Environment (Mr. McMillan) and of Transport (Mr. Bouchard) for giving so freely of the time of their departmental officials at committee stage.
The time for rhetoric is over. We must now take that final step and pass Bill C-205, an Act to protect heritage railway stations. If we fail to do so, a vitally important aspect of our national heritage and indeed of our national consciousness, our heritage railway stations, will remain prey to the vagaries of corporate decision-makers and will have at best an insecure future, or at worst, no future at all. If we fail to act and these buildings, be they humble structures in tiny hamlets or grand architectural monuments in urban centres, are lost, we will
have robbed future generations of what is rightfully their legacy.
Heritage railway stations must be preserved unimpaired for future generations, and 1 would urge the Members of this House unanimously to express their support for the Bill before us and to pass it from this House without further ado. Moreover, I would like to ask the Members of the Senate, for their part, to deal with Bill C-205 in an expeditious manner in order that the preservation of this nation's heritage railway stations may be assured.
Thank you, Mr. Speaker, and I want to thank all Hon. Members for their support. I now move third reading of Bill C-205, an Act to protect heritage railway stations.


Some Hon. Members:: Hear, hear!


Mr. Les Benjamin (Regina West):: Mr. Speaker, 1 take much pleasure in rising in support of Bill C-205 which was sponsored by the Hon. Member for Bow River (Mr. Taylor). It is a good Bill and it is long overdue.
There were many previous occasions in previous years when Hon. Members of this place from all Parties tried various and sundry ways and means of preserving railway stations as heritage sites to be refurbished or used to handle passengers. I want to compliment the Hon. Member for Bow River and say that the Bill has the full support of my caucus and my Party.
I must mention at this point a long-held dream of mine. I solicit the support of my colleague from Bow River and any other of his colleagues to finally get the beautiful old Union Station in downtown Regina converted into a multi-modal transportation centre. I have been working on this since about 1970, and there are so many players in the piece that it took years to get them all together. First the CPR was involved, then VIA Rail came into the piece and then the CTC, the Department of Transport, the City of Regina, the Saskatchewan Transportation Company, the provincial Government, and two or three others I have probably overlooked.
At one point, it looked as though we had finally gotten it together. The federal Government was prepared to put up $500,000 toward the cost of refurbishing that old station. We were to build an addition on one end for a bus administration office of about six stories and one wing of the station would be the bus terminal. The central part would be where rail passengers embarked and disembarked. There would be two or three travel agencies, a nice little restaurant and perhaps some boutiques and shops.
I am just as angry at the former NDP Government of Saskatchewan as I am at the present Conservative Government of Saskatchewan. The NDP Government dragged its feet, hummed and hawed and horsed around, but finally in February, 1982, an agreement was signed. In June, 1982, there was a change of government and the Government changed its mind. The agreement went out of the window. Now we are going to have to do the whole darn thing all over again.
August 25, 1988

In supporting this Bill, I put in my plea for help from Members from all sides of the House. 1 sure have not given up on it. It is one of several reasons why I am running again.
I also want to pay tribute to the Hon. Member for Bow River. You know, Sir, how all of us get labeled around here. I am labelled a rabid, wild-eyed, left wing socialist-communist in disguise, according to the labels.


Some Hon. Members:: More!


Leslie Gordon Benjamin: The Hon. Member for Bow River gets labeled just like other Members as a wild-eyed, right wing fascist, et cetera. Yes, there are left wing and right wing fascists.
In any case, the hon. gentleman and I have sat on the Standing Committee on Transport all the years he has been here. He has not been here quite as long as 1 have, but he has been around a heck of a lot longer than anyone else in this place or any other place. We sat in committee many a time and kicked the heck out of each other. A few times we agreed. This is a good example of that. We worked together, confounded the bureaucrats and the governments and the fancy lawyers from the railroads and a few others. In spite of all that, or perhaps because of it, the Hon. Member has with this legislation left a good legacy behind him. I say that because I understand he is not running again.
I wish I was in as good a physical shape as he is. He can run around the block and I can barely walk it. However, I believe since 1935 or 1939, I am not sure which, he sat as a Member of the Alberta Legislature, was Minister of Highways for some 17 years, and I noticed that he did not try to get away with some of the nonsense we hear nowadays from some Tories about privatization and turning highway construction over to the private sector and whatnot. He built a lot of good highways with good people in his own department. He had then and has now a reputation for honesty and integrity in his service to the public of Alberta and Canada.


Some Hon. Members:: Hear, hear!


Leslie Gordon Benjamin: That is something all of us need to emulate, whether or not we agree with the Hon. Member, and it was not too often that we did. However, he has earned the respect and regard of people in this place, the Alberta Legislature, and certainly all of western Canada. The legacy the Hon. Member is leaving behind will serve in his stead everywhere in Canada.
When I think of the thousands of locations where the two railways destroyed beautiful old buildings, I realize it is a historical and social tragedy. This legislation stops them cold. They cannot touch these buildings without someone's okay. I think it is to the everlasting credit of the Hon. Member that he took this initiative. It was a pleasure for me and my friend from the Liberal Party to support him on the issue. We took part in committee hearings, questioned witnesses, and only accepted amendments that the Hon. Member for Bow River was prepared to accept. We got it through, and I commend the Bill to the House.
Heritage Railway Stations
I also commend the Hon. Member for Bow River. I hope no other Conservatives in the House learn how to survive as long as he has. I also hope he will not teach them. However, I do mean quite sincerely what I say about him and about this legislation, and I hope it can go through now.


William Tupper: Mr. Speaker, I just want to take a few moments of the House's time to add my congratulations to our valuable and senior colleague from Bow River (Mr. Taylor) on his initiative which will ensure that our railroad heritage is in part maintained.
I do this for two or three reasons. First, I and my family have a long-standing interest in heritage matters. We live in a designated heritage home. I have had the privilege of being on the Rideau Heritage Board. I was a founding member of the Rideau Historical Society. My wife and I have, over a long period of time, appreciated and lent our skills and interests to learning about and preserving the heritage we have grown up in and been part of.
There is, however, another dimension which is awfully important to me. I am probably one of the very few Members of Parliament ever to have lived for an extended period of time in a railway station. In 1942, my mother became the station manager in Glengarry, Nova Scotia. I lived in that railway station from 1942, until I started university several years later. There are a number of unique things about that. First is the fact that my mother was appointed station master in the early days of World War II. It was very unique for the Canadian National Railway to have done that.
The building was beautiful. It was in large part a two-storey building, gabled windows in the upper storey, a freight shed with a flat roof, a waiting room about twice the size of the entrance to the West Block, with a fully functional telegraph office. It was simply a beautifully designed building, very, very functional, serving two main functions. One was to serve a prosperous rural community in the highlands of Nova Scotia, and the other was as a landmark on the railway line between New Glasgow and Truro where there was a break in the long grade over Gordon Summit crossing the height of land across Nova Scotia.
I would remind those who are not familiar with that area that the heaviest grades on railway lines in Canada exist on that branchline. That plateau on the railway line, the break in grade, served as a point for hooking on extra engines to get over the grade. It was important to the service of the local community and it was important in the functioning of the railway line.
The tragedy of all that, as I look back now at that magnificent structure, is that it is no longer there. In fact, if you drive by where that magnificent old building stood, a building which meant so much to me in my boyhood but, more important, so much to that great agricultural community in northern Nova Scotia, it has simply been destroyed. With that has gone an awful lot of railway history in Nova Scotia and a big part of that community.

August 25, 1988
Income Tax Act and Related Acts
As a professional geologist it has been my pleasure to travel widely in Canada over the years. The adoption of this Bill will ensure that three railways stations, which I consider to be great, will be preserved. The first I want to make mention of is the railway station in Cobalt, Ontario, owned by the Ontario Northland Railway. I do not know how many of my colleagues in the House have seen that station. It is a simply magnificent building and I hope it will fall under the purview of this Act. Another is the railway station in Whitehorse owned and operated by the Yukon and White Pass Railway. It is again a magnificent historical building which is linked very closely to the heritage of Canada. The third one of which I want to make note is the CPR station in Smiths Falls. It as well is a beautiful building architecturally and is very important to the evolution of the railway community in eastern Ontario.
In offering these comments I want to express my thanks to the Member for Bow River, to those colleagues of ours who served on the legislative committee, and to all Members of the House for their co-operation in adding a dimension to Canada's heritage in order that those who follow us will benefit from a great era in the evolution of Canada. So much of our historic economic evolution is related to railways and it should be a great priority for us to enhance that remembrance.


Margaret Anne Mitchell: Mr. Speaker, maybe I have risen prematurely. However, I understand that there is unanimous consent to call it six o'clock when we have finished with this order of business and to continue with the debate on Bill C-139 at that time.


The Acting Speaker (Mr. McKinnon):: I think that this will be determined when we dispose of the Bill before us. I thank the Member for her interjection.
Is the House ready for the question?


Some Hon. Members:: Question.


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


Some Hon. Members:: Agreed.


[Stage Direction]
Motion agreed to, Bill read the third time and passed.
The Acting Speaker (Mr. McKinnon):: Is there unanimous consent to suspend the sitting of the House till 6 p.m. this evening?


Raymond Garneau: I think that if you ask, Mr. Speaker, you would get the consent of the House to continue on tax reform rather than to wait until six o'clock. We on this side are prepared to attack Motion No. 7 immediately, if the House so desires.


Thomas Hockin: Mr. Speaker, I would agree to reverting to tax reform at this time rather than calling it six o'clock.


The Acting Speaker (Mr. McKinnon):: Is there unanimous agreement to proceed with the government Bill?


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of Bill C-139, an Act to amend the Income Tax Act, the Canada Pension Plan, the Unemployment Insurance Act, 1971, the Federal-Provincial Fiscal Arrangements and Federal Post-Secondary Education and Health Contributions Act, 1977 and certain Acts, as reported (with amendments) from the Standing Committee on Finance and Economic Affairs.
Raymond Garneau: Motion No. 7
That Bill C-139 be amended in Clause 90 by striking out lines 44 at page
224 and substituting the following therefor:
"(b) $4,675 plus 23 per cent of the amount by".
He said: Mr. Speaker, the objective of Motion No. 7 is to reduce from 26 to 23 per cent the middle tax rate for taxpayers with taxable incomes between $27,500 and $55,000. The rate structure would then be 17, 23, and 29 per cent, which would be much fairer than the one proposed by the Government.

Mr. Speaker, as I just said in English, the purpose of this motion is to reduce the middle tax rate for taxpayers with a taxable income between $27,500 and $55,000 from 26 per cent to 23 per cent. The rate structure would therefore be 17, 23 and 29 per cent which would be much fairer than the Government 's proposal.
Mr. Speaker, I would have preferred to table a different kind of amendment that would probably have added an additional tax rate. However, this would not be allowed under our Standing Orders, at this stage, and I am sure the Chair would have declared the amendment out of order at this stage of the proceedings. As you know, amending a tax Bill is not the easiest thing in the world because of the precedents and financial questions involved, and the Standing Orders of the House leave us very little leeway. The only thing I could do at this stage was to suggest a drop in the middle tax rate from 26 per cent to 23 per cent.
August 25, 1988

Mr. Speaker, the tax reform has changed the number of tax rates we had so far.

The Government has decided to reduce the number of tax brackets from ten to three. If this amendment is defeated, the federal rate will be 17 per cent on the first $27,500 of taxable income, 26 per cent for the additional dollars between $27,500 and $55,000, and 29 per cent on all income over $55,000.
We believe that three tax brackets are not enough. Had the rules of the House allowed me to do so I would have introduced a more complex amendment. It is not, however, possible for me to do that. I tabled this amendment in order to have the opportunity to express my point of view on the number of rates of taxation. As I have said before, three rates do not produce a progressive type of taxation.
We also believe that the gap between the second and the third rate is not large enough. It is amazing that the Minister of Finance (Mr. Wilson) decided to impose a 17 per cent tax on the first $27,000 and then jump nine points from 17 per cent to 26 per cent. There is another increase for additional earnings, but only of three percentage points. That is certainly not enough and I think that is unfair for the middle class. When we compare the taxes that middle class Canadians will pay after tax reform with the dollars they were paying in 1984 we see that the average family will have a burden of more than $1,200 per year. We say that this situation is completely unacceptable and we think it should be amended.

Mr. Speaker, when we take a closer look at the situation in various income groups, we see that according to the new tax table proposed by the Minister of Finance, with the new tax rates, people with an income of $27,000 or $28,000 will see their additional earnings.. . Someone with an income of $28,000 who has two children will see his additional earnings, say he has a raise of $1,000, this pay increase will be taxed at a marginal rate that is higher than for people with an income of $100,000. The reason is quite simple. At this income level, when you get a pay raise of $1,000, your child tax credit is reduced by 5 per cent, so that your actual tax rate is not 26 per cent but 26 per cent plus 5 per cent or 31 per cent-2 per cent more than for the person who earns $100,000 and gets a pay increase of $1,000.
This person will have to pay 29 per cent federal income tax on the additional $1,000. However, the other person who has a family with two children and whose income would increase from $28,000 to $29,000 would pay 31 per cent on the additional $1,000.
That is why we say this tax reform is unfair to families, something that has been repeated ad nauseam by all witnesses who appeared before the Finance Committee.
There are people who will say, and I am sure the Minister of Finance (Mr. Wilson) is one of them, that we don't have enough money to do something that will cost more than $1 billion. I would like to point out to the Minister that the main
Income Tax Act and Related Acts
reason he got into this fix in the first place is that he wanted to introduce tax reform in two stages, the first stage before the election and the next stage after the election, and this remedy or, should I say, this lack of courage, is being paid for by the middle class whose income will be taxed at 26 per cent, while wealthier groups might see their additional income taxed at a lower rate.
Mr. Speaker, I therefore move this amendment, and I trust it can be considered in accordance with our Standing Orders and will reflect the objective 1 have in mind which is to make it quite clear that the tax reform proposed by the Minister of Finance is unfair to families. If the Minister of Finance tells me they don't have enough money and that one billion dollars is too rich for the Government, I say now, before he has a chance to give me that argument, that I find this very hard to believe, coming from a Minister and a Government that is prepared to invest $10 billion in nuclear submarines.
If the Minister has any other points to make, I would be glad to hear them. But I will say that personally, if 1 had the resources and if our Standing Orders had allowed me to table a more complex amendment, I would have preferred to add a tax rate, because 1 still believe and 1 am convinced that three rates are not enough and that we should probably have 17, 23, 26, 29 and 31 per cent. 1 pointed out earlier and explained why at this stage of the debate, the Standing Orders do not allow me to do that, and I used the little leeway I had to make it clear to the House that there was a problem here that we had to solve.
I said a moment ago that middle class families will pay an effective marginal rate that will be superior to the marginal rate of taxation for people earning over $100,000.
The Senate Standing Committee on Banking, Trade and Commerce, in its report on tax reform, calculated the real rate. These vary according to the number of dependent children and family income level. The following example has been calculated for a family with two children. What I said a moment ago about the marginal rate of 31 per cent is very well demonstrated in this report by the Senate Committee on Banking, Trade and Commerce that was tabled in the other place.
I have read the report and am convinced that they are perfectly right that for everyone with an income between $27,500 and $45,000, the marginal rate will be 31 per cent if they have two children. That is unfair for the middle class and I hope the Government will accept this amendment.


Thomas Hockin: Mr. Speaker, the Hon. Member's proposal is to reduce the middle income marginal tax rate from 26 per cent to 23 per cent. When I looked at the motion, I asked myself what would be the revenue implications. They are rather horrendous, at some $1.8 billion. That alone encourages one to look very closely at this proposal.

August 25, 1988
Income Tax Act and Related Acts
The other day we discussed the automobile question with the Hon. Member for Laval-des-Rapides (Mr. Garneau). This is very much a limousine Liberal kind of motion. It ends up indulging the upper middle class at the expense of the lower middle class income tax bracket in absolutely grotesque proportions.
The tax rate under $27,500 would be the same as that proposed in the tax reform. However, from $27,500 to $55,000, the Liberals would reduce the marginal tax rate from 26 per cent to 23 per cent. That is the federal rate.
In order to understand how grotesque this proposal is, let us assume a 55 per cent provincial tax rate and combine it with the federal tax rate. Those rates would be 26.35 per cent for under $27,500; 40.3 per cent for the $27,500 to $55,000 bracket; and 44.95 per cent for $55,000 and over.
Let us review the tax savings at various income levels as a result of the proposal of the Hon. Member. I would like the Hon. Member's response to these because they concern every Canadian. First, the tax savings he would turn over to those at the income level of $27,000 as a result of his so-called improvement would be zero. At $30,000 it would be $75 federal, $115 federal-provincial combined if we assumed the 55 per cent provincial tax rate. That is a 0.4 per cent change as a percentage of income, a very small step forward for the $30,000 income Canadian.
Let us look at the $40,000 income level taxpayer. The combined federal-provincial savings would be $580 according to his proposal, which is a 1.5 per cent change as a percentage of income.
At $55,000, it would be a combined federal-provincial savings of $1,275 in tax, which is a 2.3 per cent change as a percent of income.
This would not only cost the Government of Canada and the Consolidated Revenue Fund $1.8 billion, a massive haem-morrhage on the Treasury, it would be horrendously regressive within the middle income tax category. It would provide no benefit to low income filers. Lower middle income filers would receive a small tax reduction from the proposal, while upper middle and high income filers would be the major beneficiaries. That is the import of this proposal.
The marginal tax rate that is proposed in Bill C-139 provides a much better balance of tax reductions to Canadians, while respecting fiscal constraint. Tax reform respects fiscal restraint and comes to terms with constantly trying to reduce the federal government deficit. When we consider the middle income category, we can see that it is progressive.
The Hon. Member's suggestion is regressive. It is a limousine Liberal approach to the middle class.


Michael Morris Cassidy: Mr. Speaker, the Hon. Minister for Finance (Mr. Hockin) has talked about limousine Liberals. He has not talked about Cadillac Conservatives.


Mr. Jourdenais:: Do not talk about my Cadillac.


Michael Morris Cassidy: There you are. There is one here to the left of me. Normally he takes a progressive position within his Party. I say to my hon. friend that if he really wants to be progressive, he and all other Quebec Conservatives will ensure that not a nickel of corporate donations given to the Progressive Conservative Party of Canada will be used on election expenditures in the Province of Quebec.

It is very curious, Mr. Speaker, that in the Province of Quebec, the Conservatives said they would not accept corporate donations, but this policy is only local and voluntary.
But, Mr. Speaker, will they refuse money spent by the Progressive Conservative Party at the national level that comes from corporations? No! Money from Alcan and General Motors will be spent by the Conservatives in the Province of Quebec. It is hypocrisy, Mr. Speaker.
The Hon. Minister of State for Finance talked about the Liberals in their limousines . . .


Claudy Mailly: Mr. Speaker, I know that it is 5.40 p.m. and we have been at this all afternoon, but I fail to see the relevancy of what the Member is speaking about in relation to tax reform. It is very interesting, particularly since he omits the union aspect of his argument. He will allow unions to contribute but he will not allow companies. It is, in any event, irrelevant to the debate, as far as I am concerned.


Michael Morris Cassidy: I would say, on the point of order, that my points were entirely relevant to the forthcoming election. The people of Canada want to know where the Parties stand with respect to the coming election. However, I see you are taking advice as to whether or not I was relevant to the Bill, and I would say to my hon. gracious colleague from Gatineau that she is correct, perhaps this point was not totally relevant to the Bill except that corporations receive tax deductions for those political contributions.


Claudy Mailly: So do unions.


Michael Morris Cassidy: Well, my colleagues are forcing me to continue this discussion.


Claudy Mailly: You have our permission to switch back to the subject.


Michael Morris Cassidy: Thank you. When I refer to the Hon. Minister of State as being a Cadillac Conservative, it is partly because he comes from London, but it relates specifically to the fact that he saw the mote in the eye of the Liberal without seeing the beam in the eye of the Conservative Party, if I can quote a bit from Scripture.
August 25, 1988

The Progressive Conservative tax regime gives the greatest tax concessions since 1984 to whom? Does it give it to senior citizens, pensioners or families trying to scrape by on $300 or $400 a week? No. It gives the greatest concessions to people earning over $100,000 a year.
1 have a Summary for Taxpayers, a booklet that was prepared by the Department of Finance. It has a little "Canada" with a blue thing over the top of it for the flag. It was changed from red. The booklet points out that for households with a decrease in tax, families under $15,000 in income will get an average reduction of $140. Families earning under $30,000 will receive a cut of $460. Families earning in the range of $30,000 to $50,000 will receive an average cut of $525. Families in the $50,000 to $100,000 range, among those with a decrease in tax, will receive a cut of $735. But what is interesting is the final bracket. This says it all. Families with an income range of over $100,000, and those who have a decrease in tax, receive an average decrease of $4,165.

The result, Mr. Speaker, is that only families and taxpayers with an income of over $100,000 a year will pay less tax in 1988, after tax reform, than they paid in 1984, when the Progressive Conservative Party came to power.
Mr. Speaker, all other families will pay more tax, although slightly reduced by tax reform, but the net result is a tax increase if you count the sales tax and other taxes raised by the Conservatives.
Now, Mr. Speaker, in real terms, the average family is suffering under Conservative rule. Its purchasing power is much less in 1988, than it was in 1984. Mr. Speaker, this is mainly due to the Government's piling tax upon tax on the average family and the average taxpayer.
Mr. Speaker, 1 do not fully agree with the Liberal Party's amendment, but what my friend from Laval-des-Rapides (Mr. Garneau) has suggested is specifically to change the tax rates for middle-income individuals, who are the base of the tax system. He is proposing that the marginal rate be reduced from 26 per cent to 23 per cent.
To begin with, Mr. Speaker, I wonder why, under the Conservatives' tax reform, a technician working for Bell Canada, for example, or an operator taking telephone calls who earns maybe $28,000 or $29,000 a year pays a marginal federal income tax rate of 26 per cent, while at the same time Jean de Grandpre, the president and CEO, the big chief of that company, with an income of over a million dollars a year, only pays a marginal rate of 29 per cent. Is that a real difference?
So here you have someone with an annual income of over $1 million who only pays the federal Government a marginal rate of 29 per cent. But the technician or the lady who takes telephone calls and works all sorts of hours, who is now on strike because of Bell Canada's effort to deny her a proper standard of living, pays a marginal rate that differs by only 3 per cent, i.e. 26 per cent.
Income Tax Act and Related Acts
Mr. Speaker, I do not deny that during the study of tax reform by the Finance and Economic Affairs Committee, the Conservative majority, which co-operated in many of our efforts, flatly refused to talk about the tax rates imposed on individuals.

When we got to that particular point, I am afraid to say that they were not dealing in an honest way with the various tax rates. There is an unfairness in a system where the Government proposes that someone earning $1 million or more a year, like Jean de Grandpre of Bell Canada, will pay a marginal tax rate only three points higher than the marginal tax rate paid by a Bell Telephone operator or technician who is scraping to meet the rent and make ends meet. There is something wrong with that.
When the Minister of State for Finance talked about the affect of the proposal made by the Hon. Member for Laval-des-Rapides (Mr. Garneau), he said this was regressive because it gives more money to people earning $50,000 a year than it gives to people earning $40,000, and surely people earning $40,000 a year should be better looked after than people earning $50,000 a year.
I agree once again with the words of the Minister of State for Finance. The problem is, however, that the words of the Minister of State for Finance are not matched by the actions of his Government. I would like to think that the Minister of State for Finance battled like crazy but was overruled by the Minister of Finance (Mr. Wilson), who is after all a former denizen of Bay Street where he worked in the investment industry. However, I have to say that, having perhaps worked too long at the University of Western Ontario, the Minister of State for Finance himself really buys the same argument, this neo-Conservative argument which has seeped across the border like a PCB oil spill from the United States that somehow it is good to reduce taxes on the rich and on the very rich because it will trickle down in benefits for average Canadians.
We all know that it does not. It goes into Mercedes, Cadillacs and limousines for Liberals and that kind of thing. It trickles up and stays up and it really does not benefit average Canadians at all. If we want to be honest about it, we would ensure that we had a fair tax system where the taxes on wealthy Canadians were proportionate to their ability to pay and where the average middle-class Canadian family, who is scraping by trying to pay a mortgage with the rates up by half a point today, and trying to meet the cost of living which has gone up since 1984, would in fact not have to pay a rate of tax that was just a shade off the rate of tax being paid by wealthy and very wealthy Canadians. It would be a tax system in which capital gains would be taxed on the basis of total inclusion rather than being totally exempted up to $1,000 as proposed by the Government or, for that matter, with the rate reduced by the Liberal Party.

August 25, 1988
Income Tax Act and Related Acts
These are aspects of tax fairness-


The Acting Speaker (Mr. Fretz):: Is the House ready for the question?
On debate, the Hon. Member Saint Leonard-Anjou (Mr. Gagliano).
[ Translation]


Alfonso Gagliano: Mr. Speaker, I rise in support of Motion No. 7 put forward by my colleague for Laval-des-Rapides (Mr. Garneau). I would like to state in the first place that this afternoon we just discovered this Tory Government's total hypocrisy. Each time we put forward an amendment, they immediately said it would cost that much. My understanding was that when they embarked upon tax reform the intention indeed was to strive for fairness and bring in propositions that were aimed at social justice, bringing fairness to all. What the Minister of State (Finance) (Mr. Hockin) just said is unacceptable, Mr. Speaker. If we are to have rates that are fair to everyone, they should be at some point analyzed, and my colleague for Laval-des-Rapides proposed indeed for the $25,000 to $50,000 income bracket a rate that would be fair, that would be half way up the scale instead of a rate that is near the third one for the $55,000 and over bracket. Rather than come up with sound reasons and explain its position on that, the Government wonders how much that will cost, Mr. Speaker. Is this the way to go about achieving tax reform? This is not tax reform. It is adjusting the Income Tax Act to the Government's needs.
In the United States, Mr. Speaker, when the Americans decided to go into tax reform, it worked because all parties agreed on the mechanisms, the principle of that tax reform. They set up their parameters and told the officials: Here they are, implement them. There was no question of looking at costs only. Do we build up society by looking at the costs or by having principles of social fairness? This afternoon, we have clear and specific evidence that this Government has no idea of what social justice is, what fairness to all is.
Mr. Speaker, they always end up talking about money each time we come up with a proposal for child care services, which everyone has come to need. Each time we come up with proposals to lighten the tax burden of senior citizens, the answer is there is no money. But money they have, Mr. Speaker, to buy nuclear submarines. Will that bring us social justice? This shows the Conservative Party for what it really is. What my colleague for Laval-des-Rapides is proposing is very simple.
But the Minister of State (Finance) argued this would increase costs. Therein lies his error, Mr. Speaker, and I will not elaborate because this is so technical it might be difficult to explain to Canadians. What my colleague for Laval-des-Rapides is asking for is a change in rates, not the basic amount. This is what the Minister would not understand. What do we propose? We propose to reduce the rate from 26
per cent to 23 per cent, the average tax rate, for taxpayers with taxable income between $27,500 and $55,000. This is clear and simple. We are looking for social justice between the 17 per cent and the 29 per cent. Is that clear enough? The tax structure would include tax rates of 17 per cent, 23 per cent, and 29 per cent, which would be much more equitable than that proposed by the Government.
I spent two full days sitting on the Finance Committee, and whenever we proposed something ... I remember that one night, the Conservatives Members on the Committee were fully in agreement with me and we removed one of the clauses-more on that later-but then we had to recant when an official commented that the proposal was impossible to accept because it would cost too much money. Yet, when we had discussed it without any reference to the costs, even the Tory Members were in agreement. But when faced with the costs, they said: "Hold everything!" That is what the so-called tax reform is all about, Mr. Speaker! It's really a joke to talk about tax reform when taxpayers are not treated fairly and when the only reason for amending the Income Tax Act is to make it possible for the Government to get other revenues while lulling Canadians taxpayers into believing that it is easing their tax burdens.


Claudy Mailly: Mr. Speaker, the Hon. Member for Saint-Leonard-Anjou (Mr. Gagliano) has just stated that proposals should be considered irrespective of their costs. It is exactly that approach which is responsible for the very high deficit we are faced with today and which was responsible for such an extraordinary high level of inflation that the interest rates reached 22 per cent, that homeowners were losing their houses, and that young families who had managed to buy houses were losing them. As you know, Mr. Speaker, it is all very nice to be dreaming in colour and saying that the Government could give away everything while reducing taxes, that it could make available all the programs it is asked for, but it has to be concerned about costs because it will have to foot the bill in the end. Such an approach is both simplistic and disastrous. We had evidence of this in 1982, with the high interest rates and with inflation rates of 12 per cent, 13 per cent and 14 per cent. We had evidence of this with an unemployment rate with reached 20 per cent in some areas of my riding while it is down to about 5 per cent today.
Mr. Speaker, it is all very nice for the Opposition to speak with a sharp tongue and accuse us of being insensitive because we pause to ask just how much its proposals will cost. But after all, it is a question we have to ask, because this money we would be spending would be coming out of our own pockets. It is a fact that, as Members of the House, we would be called upon to contribute through our income taxes, but it is really the Canadian consumers who would have to pay more when they go shopping at the supermarket or when they go to the bank to renegociate their mortgages. The people who want to
August 25, 1988

buy houses would not be able to afford them because of skyrocketing inflation rates. Moreover, they would not be able to buy them anyway because they would be without jobs. They would find themselves back where they were in 1981-82, among the 20 per cent unemployed who could not meet their payments on their cars, their houses, and did not have enough money at the end of the month to feed their families properly. It is ridiculous to try and show the tax reform in this light, from this point of view. It does not make sense, Mr. Speaker.
What I am trying to say is that we are dealing today with a legislation which we put forward because we wanted to streamline public finances and put everything back in order again. We certainly do not want to return to the total chaos the Liberals had created.


The Acting Speaker (Mr. Fretz):: The question is on Motion No. 7 standing in the name of the Hon. Member for Laval-des-Rapides (Mr. Garneau). Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mr. Fretz):: All those in favour of the motion will please say yea.


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


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


Some Hon. Members:: On division.


The Acting Speaker (Mr. Fretz):: I declare the motion lost, on division.
Motion (Mr. Garneau) negatived.


Raymond Garneau: Motion No. 8
That Bill C-139 be amended in Clause 91 by
(a)	striking out line 11 at page 226 and substituting the following therefor:
"118.2(1) and"
(b)	inserting immediately after line 44 at page 226 the following:
"(1.1) Each of the amounts expressed in dollars in subsections 118.3 (1) and 112.2 (1) shall be adjusted for each taxation year after 1988 so that the amount equal to the aggregate of
(a) the amount that would, but for subsection (3), be the amount to be
used thereunder for the immediately preceding taxation year: and
Income Tax Act and Related Acts
(b) the product obtained by multiplying
(i)	the amount referred to in paragraph (b) by
(ii)	the amount, adjusted in such a manner as may be prescribed and rounded to the nearest one-thousandth, or where the result obtained is equidistant from two consecutive one-thousandths, to the higher thereof, that is determined by the formula:
A/B
where
A is the Consumer Price Index for the 12 month period that ended on September 30 next before that year, and
B is the Consumer Price Index for the 12 month period immediately preceding the period mentioned in the description of A."
Motion No. 9
That Bill C-139 be amended in Clause 92 by striking out line 15 at page 228 and substituting the following therefor:


&quot;$5,000 -(C- $1,000)&quot;
[Stage Direction]
He said: Mr. Speaker, as you know we decided that it was six o'clock after the debate on the private Member's Bill and my colleague, the Hon. Member for Trinity (Miss Nicholson), did not know that. She was supposed to be back in the House at 6 p.m., but because of the decision taken by the House, she may be delayed a bit. 1 would like to see her motion accepted even though she is not here at the moment.
Raymond Garneau: I would like to propose the amendment for her.


The Acting Speaker (Mr. Fretz):: Is it agreed?


Some Hon. Members:: Agreed.


Raymond Garneau: Motion No. 10
That Bill C-139 be amended in Clause 92
(a)	by striking out line 49 at page 228 and substituting the following therefor:
"under 21 years of age and in full-time attendance at a school or under 21 years of age and unemployed or so"
(b)	by striking out lines 20 and 21 at page 229 and substituting the following therefor:
"age of 21 years at any time in the year, and either in full-time attendance at a school or unemployed, an amount determined by the".


Raymond Garneau: Motion No. 11
That Bill C-139 be amended in clause 92 by striking out line 8 at page 229 and substituting the following therefor:


&quot;$5,000-(D-$1,000)&quot;. COMMONS DEBATES
[Stage Direction]
August 25, 1988
Income Tax Act and Related Acts
Motion No. 12
That Bill C-139 be amended in clause 92 by striking out line 35 at page 229 and substituting the following therefor:
"of those dependants and of dependants of at least 19 years and under 21 years of age, be read as twice".
-Mr. Speaker, the grouping of these motions does not make for easy debating, especially since we have only 10 minutes to address very complicated issues.
My Motion N° 8 is aimed at reindexing the refundable dependent child tax credit and the credit for mental and physical impairment.
[Stage Direction]
In Motion No. 8 we propose to reindex the refundable child tax credit and the credit for mental and physical impairment.
[Stage Direction]
Mr. Speaker, in its 1985 Estimates, the Conservative Government decided to partially deindex child tax credits, family allowances and also the tax tables. Those are all hidden tax increases which the Conservative Government, through the Minister of Finance (Mr. Wilson), has imposed on Canadians after having promised not to increase taxes.
Mr. Speaker, what we propose, once again within the bounds of the Standing Orders, is to save at least the essential. We know that there are major problems facing families. Everybody recognizes that the birth rate is down. A huge number of single parent families find themselves in difficult financial situations.
We propose to reindex completely the refundable child tax credit as well as the tax credit for mental and physical impairment. To me, it's a matter of common sense, of being compassionate towards people who are in need because of a physical or mental impairment and of ensuring that inflation will not whittle down the income of families with children.
We have limited our amendment to two specific cases, although I would have liked to do the same thing for other sectors.
[Stage Direction]
To reindex the refundable child tax credit and the credit for mental and physical impairment.
[Stage Direction]
Mr. Speaker, in Motion Nos. 9 and 11 we recommend raising the income threshold of the spouse or dependent children at which the tax credit for a married person and the equivalent credit for a married person begins to be reduced. This recommendation had been made by the Senate Committee on Tax Reform and I support it.
[Stage Direction]
In Motion Nos. 9 and 11 that we are debating now, we propose to increase from $500 to $1,000 the income threshold of the spouse, or the dependent children; at which point the married credit and equivalent to married credit begins to be reduced. This recommendation has been made by the Senate committee on tax reform.
Nowadays, children or students at university are trying to find themselves jobs. To earn $500 is not very much. In this situation, if the student earns $1,000, even though his family is paying for all the tuition fees and the room and board, et cetera, they cannot deduct the full amount because this student has earned a little more during the summer. I think that it should be increased to at least $1,000. It would be only fair. The same applies for the spouse. It does not take much to earn $500 through a little income, a little savings, and we think that the program will be more up to date and more in line with the situation that we are facing today if we increase the limit of revenue before cutting the tax credit for a spouse or children who are still living with the family.
[Stage Direction]
Mr. Speaker, the motion I am referring to would allow a wife to earn up to $1,000-or her husband if he happens to be the dependent-before the tax credit begins to be reduced because of the income level of the wife or husband who is the dependent of the household main income earner.
The same thing goes for students. We believe that the $500 ceiling on earnings is too low. A student who is not afraid to work at delivering papers every day may very well earn more than $500 a year, and as a result his father or mother would not get the full credit for this hard working child, or for another attending vocational school or college whose summer job brings in $900 or $ 1,000.
Finally, Mr. Speaker, Motion No. 12 would provide a $130 credit for dependent children aged 19 to 21.
[Stage Direction]
Motion No. 12 institutes $130 credit for dependent children aged 19 to 21.
[Stage Direction]
Mr. Speaker, the tax reform has eliminated the concept of dependent children over 18 so that the father of a full-time university student who lives at home and earns $500 can, as a result of the tax reform, claim the full tax credit deduction. But if he happens to be over 18 it does not matter whether he attends university or even vocational school, no more deductions.
And that is not all, Mr. Speaker. When the head of the family dies, the mother takes over, she works outside and earns an income, but if her 18-year-old son is a full-time university student she cannot claim him as the equivalent of a spouse. These are new changes imposed by the Minister of Finance in his tax reform.
I find that totally unacceptable because, in the case of a family with a dependent child at school, there should at least be exceptions for those attending school on a full-time basis or for those who are staying at home and are without work. Those people, those families, are almost forced to make living arrangements outside the home to be able to get welfare. I
August 25, 1988
[Stage Direction]
think that the Minister of Finance and the Conservative Government have adopted an approach which is totally unjust and insensitive, which disregards the situation of families and which makes things even more difficult, particularly for single parents because women who are heads of families can claim the equivalent of married exemption for a child under 18. They are heavily penalized however when the child reaches 18 because they can no longer claim that exemption. Furthermore, if the child is responsible enough to earn some money and his income exceeds $500, his mother's tax advantage is eroded.
Mr. Speaker, it is too bad that we have to debate these motions together because we could have brought forward much more detailed and convincing arguments.
Earlier I listened to the Hon. Member for Gatineau (Mrs. Mailly) who talked about balance, the deficit, interest rates and, of course, she would have been well advised to read up on what was happening in the world during that period before making her speech. There is something I do not understand. Where was the Hon. Member for Gatineau when her government proposed to spend 12 or 16 billion dollars on nuclear submarines? Did she rise in the House to point out we could not afford it? Did she rise to say it would cost too much? Money can be found for nuclear submarines without any problem. But when it is a matter of re-indexing child tax credits, tax credits for the mentally or physically handicapped, there is no money. When it is a matter of allowing a spouse or children to earn as much as $1,000 before reducing the tax benefits the father or mother can claim, there is no more money. When it is a matter of giving a $130 tax credit to the father or mother who wholly supports a full-time university student, which is the case 80 per cent of the time, there is no money. However, no Conservative Member brings up the matter of money or lack of it with regard to nuclear submarines.
Mr. Speaker, it is time to introduce more fairness in our proceedings, and if we lack money to make the tax system more equitable, then we must not have enough to buy nuclear submarines either.
Claudy Mailly: Mr. Speaker, the Hon. Member for Laval-des-Rapides has a selective memory because if he had total recall, he would remember that there is now a very hot debate on the issue of nuclear submarines, which is being examined from different angles including their cost. But it would be very simplistic on his part to compare a National Defense expenditure with tax reform and to conclude that, since we cannot reduce or eliminate any exemptions, we cannot proceed with tax reform.
Once again, he is selective. He picks the exemption for dependent children which is equivalent to the married exemption.
1 was one of those single parents for several years. I took advantage of that exemption and 1 agree with him that many of those single parents are very sad to see it go, but what he fails to mention is that to compensate for its elimination we
Income Tax Act and Related Acts
have reduced the tax rate. He suggested earlier that we should have reduced it even more. However, the amounts needed to increase exemptions have to be found somewhere. He said we should not be concerned with the deficit and all that jazz. Mr. Speaker, 1 find that speech a little strange coming, as it is, from a former provincial Minister of Finance.
We are still hearing emotional speeches in here, Mr. Speaker.


Raymond Garneau: Please sit down!


Claudy Mailly: You see, Mr. Speaker, instead of debating he says I should sit down. He does not like my arguments because they hit very close to home and he has a problem with that.
That is because instead of discussing frankly and honestly the advantages and disadvantages of that tax proposal, he would rather attempt to sidetrack the debate with an outpouring of emotion, half-truth and exaggeration. It is very unfortunate because that debate is a very important one for Canadians, Mr. Speaker.


Michael Morris Cassidy: Mr. Speaker, as the Hon. Member for Laval-des-Rapides (Mr. Garneau) said, it is a bit difficult to comment on at this point because five motions are grouped. Motion No. 8 deals with full indexing for the cost of living in tax rates, in brackets, as opposed to the partial deindexation which is proposed by the Minister of Finance (Mr. Wilson). Three of the amendments deal with the deduction for earned income of dependants and of students. The final one relates to the amount which is given for the child tax credit for dependants where there is a dependant aged 19 to 21 in a family.
Let me comment briefly on that. The Government in the massaging it went through on tax reform created a system which was wildly inequitable and unfair to people with children. It was so unfair that once you got beyond having a couple of children you would actually be worse off under tax reform than you would have been without it. That certainly seemed like a perverse situation. That is why the Government decided that it would increase the child tax credit for the third or subsequent child.
1 believe that the amendment extends that to a dependant aged 19 to 21. My colleague, the Hon. Member for Vancouver East (Ms. Mitchell) will talk about that. However, there is something more generally perverse about the Government's proposal. Take a couple of people in similar circumstances, say Joe and Jim or Mary and Sue who all work for Revenue Canada. Each one is a bread-winner. Each has comparable circumstances as far as the family is concerned and each is aged 31 or 32. Joe has a wife and couple or three kids. His seat-mate, the person working right next to him, Jim, has the same job with the same income, but instead of having children he is putting money into RRSPs to the maximum allowable according to government policy. Anybody would assume that the wage earner with the family would be treated more generously than the wage earner with the RRSP deduction, but it is the contrary under the Conservatives. I think there is something wrong with that.

August 25, 1988
Income Tax Act and Related Acts
The Government shows that it has its values turned around. If the Government were really concerned about the family, which I believe will be an important issue in the forthcoming election campaign, it would not have to bring in these artificial amendments about the third and subsequent child and so on. The Government would have demonstrated a commitment to equity by ensuring that the tax system in this country genuinely aided people with family responsibilities. Tax systems are there to raise revenue, but they also are there to express a social philosophy about the kind of society and the kind of country we want to have. Conservative tax philosophy does not have a great deal to say about the men and women, the parents who are raising kids in our society. I get upset over that, Mr. Speaker, as I get upset when I find developers and entrepreneurs in my constituency open up what they call adult only apartment buildings. My constituents who have children find they are shut out of desirable accommodation because it is adult only. I would have thought that everybody in society should have a commitment, but the Conservatives do not seem to have that.
1 want to comment specifically on Motion No. 8 which aims to substitute full indexing for the deindexation put forward by the Minister of Finance in his tax reform proposals. It is very interesting to think that the Conservatives have come full circle on this question of indexing. You will recall that it was the Conservatives under Robert Stanfield who proposed that the tax system be indexed, some time back in the late 1960s. They fought for that and they thought it was fair. The New Democrats thought it was fair as well. Finally, ironically, it was the then Minister of Finance, the now Leader of the Official Opposition (Mr. Turner), who brought indexing into the tax system.
My Party still supports indexing, particularly for people with modest incomes. I know where Robert Stanfield was on this issue and I know where the Conservatives are now. They have turned full face. They have abandoned the commitment they made in the 1960s and the 1970s. Now, instead of full indexation, it is indexation minus 3 per cent.
This is a very subtle way to impose a tax increase on average Canadians year after year. The child tax credit is partially deindexed. The value goes down by 3 per cent every year. The family allowance is partially deindexed. The value goes down by 3 per cent every year in any year when the rate of inflation exceeds 3 per cent.
The tax reform brackets are only partially deindexed, and therefore, rather than rising with inflation, they decline in value every year. That means that for people who are sitting around those turning points there is an increase in taxation every year. It is a hidden increase in taxation and, therefore, it is a dishonest increase in taxation.
I suppose that the Minister of State for Finance (Mr. Hockin) will tell us that the $100,000 limit on tax-free capital gains is totally deindexed, that it will be worth $100,000 next year, the year after that, and the year after that. I suppose that is the case, but it will take an awfully long time for an average family paying these increases in taxes to catch up with the privilege given to the wealthy family who is able to take advantage of having an investment property, some stocks and bonds, or an investment in a company and make $100,000 without paying a nickel in tax on that investment. Therefore, I would say that that argument falls.
My own feeling is that we should focus the indexing and protection against inflation at people on modest incomes. In the United States, as a matter of fact, there is a procedure by which the lower rates and the lower tax brackets for people at the top of the income scale are recaptured. Once the income of an American goes above $70,000 or $80,000, he then finds himself paying additional taxes on the money in the $20,000, $30,000, or $40,000 bracket which was initially taxed at the lower rate. I do not think that that is unfair. I think that is reasonable and recognizes the fact that if there is to be some moderation of tax rates, then there should not be the additional moderation for people at the top of the income scale getting reduced rates on the first $5,000, $10,000, or $15,000 when it is taxed.
The Government has focused this particular measure on people with modest incomes. The deindexing which takes place should not be there. I believe we should have full indexing for people on modest incomes so that, as their incomes rise, in order to keep pace with the cost of living, they do not then find that the tax person has his or her hands in their pockets before they get the benefit of some protection against inflation through rising incomes.
We have seen over the last few years just what the Conservatives have done. They raised the sales tax in 1984, they raised it again, and they raised it again. They eliminated the special tax cuts that were given to families on modest incomes. They brought in tax reform which they say will take 850,000 people off the tax rolls without pointing out that they added one million people to the tax rolls beforehand. All these things are a part of a tax grab which seems to be hitting particularly at people on modest incomes.
There is a theory of taxation that says we have to hit average people because there are so many of them. I think that is to hold average people in contempt. I think average, ordinary Canadians are prepared to pay their fair share, but they do not think it is right if they are paying, and paying, and paying again because wealthy Canadians are getting a privilege, on top of a concession, on top of a loophole, on top of another new way they can avoid paying income tax. Partial deindexing is particularly offensive because it is not just a once-and-for-all kind of thing, it is a measure which will go on year after year.
August 25, 1988

It is as though the Minister of State for Finance is reaching out from his heartland in London. Long after he ceases to be a Member of Parliament, he and the Minister of Finance will still have their hands in the pockets of ordinary Canadians with this partial deindexing proposal if we do not do something about it. That is why I happen to believe that Motion No. 8, which seeks to substitute full indexing for the deindexation contained in the Finance Minister's proposal, is a good one and should be accepted.
The Minister of State for Finance might pop up and say: "Oh, you are giving a privilege to people earning over $55,000 a year because you are going to let them benefit from full indexing". I would then challenge him to come behind the curtains with me and devise a tax system which is really fair for those people earning over $55,000 per year, a system designed on the American model, perhaps, a system that would ensure that the rates paid are more appropriate, given the ability to pay.
Let us get rid of the system in which the rich get tax cuts, ordinary people get tax increases, and partial deindexing will hit average Canadians in secula saeculorum, century after century, unless we do something about it. The time to do something is now, and 1 would urge you, Mr. Speaker, to step down from your chair and join the New Democrats, and in this case their colleagues, the Liberals, in ensuring that some tax fairness is put back into tax reform.


Margaret Anne Mitchell: Mr. Speaker, I want very much to have the opportunity to speak on this group of amendments, particularly those that apply to family benefits. We have to think of families in a different way than we think of single taxpayers who are concerned only with their own costs and with two wage earners who have no dependants. It is absolutely essential that we put a much greater emphasis on the needs of families, both from the point of view of the cost of raising children and from the point of view of the contribution parents with their children, the next generation, make to society for the rest of us. This is the generation that will pay for our old age pensions.
The Government has spoken a lot about being sympathetic to families, wanting to recognize families, yet the whole tax system has done the reverse. Family benefits have gone down rather than up and single taxpayers have had greater increases in tax benefits than have parents who have the extra costs and responsibilities and are contributing so much to society by raising children.
1 would like to speak particularly to Motion No. 12 which concerns child tax credits for older children, dependants who are in the age bracket of 19 to 21. There are many, many parents who still have dependent children in that age group. The Government, of course, has disregarded this and has entirely removed them from the child tax credit coverage. We are talking now about lower income families.
We are told that this is fair since the parents of those going on to post-secondary education will be able to deduct the school fees from their income tax. Of course, it is absolutely
Income Tax Act and Related Acts
essential that parents of these children are able to deduct at least these fees. There are many other costs which they will not be able to deduct. However, the Conservatives have completely disregarded a very large group of young people who are not going on to post-secondary education of any kind. They are not lucky enough to be able to get into college or university or trade training. Essentially they are at home. We must think also of parents with disabled children and the tremendous costs involved.
However, 1 would like to speak primarily about young people, many of them in my riding, who are unemployed, unable to get into training programs, and their parents have very low incomes. Many of those parents are single parents, on welfare in many cases, and they have been completely ignored by the Conservatives, and ignored in this Liberal amendment unless they happen to have two children. I do not know why they penalize the parent with one or two children. It costs quite a bit to feed them if they are at home and not working. There are many costs that their parents have to cover.
I happen to have Statistics Canada figures for the riding of Vancouver East. I would like to point out that for the age group of 15 to 24, the unemployment rate for males is 26.5 per cent; very high. For females it is a little less at 16.9 per cent. Let us compare that to 20 per cent and 15 per cent for those adults over 25. That is a very high unemployment rate, and I see that there are some 40,000 people in my riding who are not in the labour force but are over the age of 15 years.
These young people are living at home under a lot of stress. It is a time of conflict between parents and children. The young people are feeling very discouraged and worthless, and parents are feeling pretty hostile because they have to carry the expense and are barely managing to survive as it is, I am sure. It is grossly unfair and increasing the tension in families for the Government, then, to remove the child tax credit. It is kind of a last straw for poor families. I cannot understand why the Government would not cover these children and make the child tax credit available to the parents. We urge the Government to reconsider this.
Nor do we think that Motion No. 12, the Liberal amendment, is adequate. It recognizes that the child tax credit should be increased for dependants aged 19 to 21, but only if the taxpayer has three or more dependants. I do not know why they put that restriction on it. It seems very unfair. Certainly poor families that I know of cannot manage with two children. The alternative for these young people is to go on welfare. As my colleague says, in Quebec they would only get $150 a month living out of the home. That means that they are forced on to the streets to earn additional money for survival by illicit means. It certainly happens in my riding. If they are still staying at home, their parents are penalized, and it is very difficult for young people living at home to qualify for social assistance. This in turn forces children out of the home and forces parents to tell them that if they leave home and go out on the skids at least they will get welfare; very inadequate welfare it is.

August 25, 1988
Income Tax Act and Related Acts
This policy is adding to that syndrome for welfare families, so we should not support Motion No. 12. It is a slight step in the right direction, but it discriminates against certain kinds of families with one or two dependants. We urge the Government to reconsider its tax measures in this area.


Miss Aideen Nicholson (Trinity):: Mr. Speaker, of the amendments grouped for debate I would like to address Motion No. 10 which stands on the Order Paper in my name. It deals with the tax treatment of older dependent children, 18 and up. The (a) part of my amendment deals with older children in a one-parent family and the (b) part deals with older children in the two-parent family.
I first want to talk about the equivalent to married tax credit or tax deduction which was available before this so-called tax reform to a single parent with a dependent child under 21. The equivalent to married deduction which could be claimed by the parent in such a case has been valued by the Department of Finance at $3,740 for 1987. A single parent can no longer claim that. The Government is, instead, offering a new credit which is only available if the child is under 18. This fails to consider the 18 year old who is still at home and going to school. In Ontario the average 18 year old is still in high school. This also fails to consider the 18 year old living at home and unemployed.
For a number of years now the unemployment rate for people under 25 has been double the national average. People with high school education only have particular difficulty in getting into the labour force. In 1986, the national employment rate for 18-year-olds was 21.4 per cent; for 19, 20, and 21-year-olds it was 19.3 per cent, 18 per cent, and 16.5 per cent respectively; generally about twice the national average, twice the unemployment rate for people over 25, particularly for those who have specialized skills. Single parents who are supporting older children at home are particularly hard hit because when the child reaches 18 the family allowance cheque stops, the right to receive the child tax credit, which will be increased in 1988, stops, and for the parent who receives support from the other spouse, child support payments very often stop when the child becomes 18.
For a single parent with a low income, and it is mostly women and single parents who have custody of their children, removing access to the equivalent to married deduction for a dependent child under 21, which is, as I said, valued by the Department of Finance at $3,740 in 1987, comes at a very difficult time when other forms of support are drying up.
The Government claims that it has made up for the loss of this deduction by providing a sales tax credit of $70 to 18-year-olds regardless of their dependent status. Also there will be a tuition fee credit for the parents of youths in postsecondary education. This does nothing for the parents of
dependent youths who are either still in high school or unemployed. Clearly, the government proposal makes life harder for single parents with older dependent children. That is the purpose of my Motion No. 10 (a) which would amend Bill C-139 in Clause 92 by striking out line 49 and substituting the following therefore:
"under 21 years of age and in full-time attendance at a school or under 21 years of age and unemployed or so"
The second part of my motion deals with the older dependent child living in a two-parent family. The child who is in high school or the child who is unemployed is quite a heavy burden financially-although he or she may be a great joy in other ways-if the parents have a low income. As in the case of a single parent, family allowance benefits and the right to a child tax credit stop at age 18.
The Government argues that a credit will be available to parents with physically and mentally infirm children. This is no help to parents with healthy 18-year-olds who have to be supported in high school and whose clothing, transportation, recreation, and food bills still have to be met. It certainly is no help for the parent with an unemployed 18-year-old who also has to be provided with the necessaries to help in a job search.
In order to return some fairness to the situation, Motion No. 10 (b) would extend the current personal exemption to parents with children 21 years of age and under, regardless of the state of their health.


Thomas Hockin: Mr. Speaker, I would like to speak to these motions because they raise some important matters of principle on which the Government should make its response clear. I would like to begin with a blanket comment about the analogy and example used by the Hon. Member for Ottawa Centre (Mr. Cassidy) which seems to underpin his critique of tax reform, that is, his example of the Chairman of Bell Canada and the average Bell worker because he is concerned about progressivity. I think I can help him with his problem because he is using marginal tax rates instead of average tax rates. If he took average tax rates he would feel better about the progressivity of our system.
I will given an example. If you take the combined federal and provincial rate, under tax reform a one-earner couple earning $30,000 with two children has a 13.7 per cent average tax rate. I think the Hon. Member knows what an average tax rate is. It is different from a marginal tax rate which is the tax on the next dollar when you move into a new bracket. The average tax rate is what you actually pay on an income of $30,000.
August 25, 1988

On $60,000 the average tax rate is 29.2 per cent. On $100,000 the average tax rate is 35.8 per cent. Once again, I am talking about combined federal and provincial taxes. The average tax rate on $200,000 is 40.8 per cent. I have no idea whether Mr. de Grandpre earns $1 million a year, but if so he would be taxed at a 44.8 per cent average tax rate.
The system is very strongly progressive when you use average tax rates which, of course, is the rate you should look at. We all know that when we do our taxes we think the marginal tax rate is high, but when we work it out we see that it is somewhat less because the average turns out to be less. It is the average ladder which is really the measure of a tax system progressivity. The Member is misunderstanding tax reform because he misunderstands the difference between marginal and average tax rates.
The Hon. Member for Trinity (Miss Nicholson) and the Hon. Member for Laval-des-Rapides (Mr. Garneau) have brought motions before the House as well this evening and 1 would like to respond to those. First, the implications of removing the indexing restrictions of the CPI minus three for the refundable child tax credit and the disability credit, from a point of view of revenue, are not trivial. This would cost $75 million.
Allow me to speak to this proposal. Over recent years the Government has introduced a number of changes increasing the benefits of both the refundable tax credit and the disability credit. The general problem that 1 have with all these Liberal motions is that they take one little piece out of the mosaic and look at it rather than looking at the whole mosaic.
I remind Members that we have been increasing benefits under the refundable tax credit and the disability credit. The child tax credit was increased by $70 in 1986, and by $35 in 1987-88. Tax reform further increased the refundable child tax credit by $35 in 1988. The new child care initiatives also increase the refundable child tax credit by $100 in 1988, and by $200 in 1989, and subsequent taxation years for children under seven years of age without child care receipts.
This is all part of the story. This Liberal motion conveniently overlooks these very important parts of the mosaic which makes up the tax system of Canada after tax reform. As a result of the combination of these changes, many parents with children under seven years of age will benefit from a $375 increase in the refundable child tax credit. It must be said in this House over and over again that all these credits end up being much more beneficial than the restriction on the CPI minus three about which Hon. Members opposite complain.
The new disability credit, too, is more advantageous than the old exemption for the majority of beneficiaries. The credit is worth $550, while the old exemption of $29.20 was worth $496 for someone with income of less than $27,500. There, too, the system is more generous and better targeted. The House should know that as a result of the change introduced
Income Tax Act and Related Acts
by the Government in 1986, 85,000 new disabled persons have benefited from the expansion of the criteria of eligibility.
Motion No. 9 would increase from $500 to $1,000 the amount of income that a spouse may earn before the credit for marital status is reduced, and Motion 11 would do the same in the case of the equivalent to married credit. I want to speak to that, another motion which would cost the federal Treasury $75 million.
We do not feel that this is the way to go because, first, the $500 is the exempt income threshold under the existing law. It is important that we understand that increasing this amount would simply open the door to increased income splitting between high income spouses with income from property and non-working spouses. We just do not believe that this is fair. We thought about this very carefully and did not want to stand on the side of unfairness with regard to this.
The increase in the value of the marital credit provided in tax reform increases by over $1,200, from $4,300 to $5,500, the amount of income that may be earned before the relief for married status ends up being reduced to zero. This makes sense. This is clearly the way to approach tax reform. It does not make sense to accept this motion and incur an extra $75 million from the Consolidated Revenue Fund.
Motion No. 10 (a) extends the equivalent to married exemption for children aged 19 to 21 who are in full-time attendance at school or unemployed. The Hon. Member for Trinity spoke to this and I would like to deal with it. This, too, would cost around $75 million. Let us understand the history and all that surrounds this. Prior to tax reform the equivalent to married exemption could be claimed by a taxpayer who was single, divorced, separated, or widowed who supported a dependant of any age living with him or her during the year.
Under tax reform, the equivalent to married exemption has been converted into an equivalent to married credit. The credit can be claimed for a parent or grandparent of the taxpayer, an infirm relative, or a dependant 18 years of age or younger. Let us remember that we have broadened what we mean by dependant.
The Hon. Member for Trinity expressed concern for those between the ages of 19 and 21. Things have changed in this country. Previously, the age of majority was 21 but it has been reduced over time, and age 18 is now generally regarded as the age of majority for most federal laws and programs and most provincial family laws and social assistance programs. Would the pages want us to raise the age of majority to 21? Does it not make sense that it is at age 18? This has been done at the provincial level as well as at the federal level. For example, both the family allowance and the Canadian and Quebec Pension Plans regard age 18 as the upper limit for minor children.

August 25, 1988
Income Tax Act and Related Acts
There could have been a misunderstanding in this debate. We must remember that children who turn 18 in a year will continue to benefit from the refundable child tax credit, the dependent child credit, as well as the equivalent to married credit. Dependants 19 and over in full-time attendance at a post-secondary school will be able to transfer the unused portion of up to $600 of the education and tuition credits to a supporting spouse, parent, or grandparent. This represents a significant improvement over the existing system for children in post-secondary schools.
Recently 1 talked to a group of university presidents who said that this was very helpful. Again, the pages must appreciate this proposal. That deduction used to have to be taken by the low income earning student. Now it can be transferred to a parent or grandparent who could get more benefit from it.
The suggested increase to age 21 would set a wholly arbitrary age restriction. Those are basically my problems with the motion by the Elon. Member for Trinity. We have a new age of majority, we have the unused tuition fees credit, we have dependents 19 and over who can claim the refundable sales tax credit in their own right. This means that it would be inconsistent for the tax system to treat a 19 to 21 year old person as two things: a dependent child and as an adult. It is one or the other. This system treats them as an adult.
All these measures add up to a significant improvement over the existing system for children in post-secondary schools. Furthermore, children turning 18 in a year will continue to benefit from the refundable child tax credit, the dependent child credit, as well as the equivalent to married credit. Tax reform provides a $250 tax credit for older children who are dependent by reason of mental or physical infirmity.
The burden of my intervention this evening is to say that we should not look at one piece of tax reform and criticize it, try to increase it or make it more liberal. We should consider the whole mosaic to see the fairness of tax reform, the useful targeting of tax reform, and the progressivity of it as well. [Translation]


Alfonso Gagliano: Madam Speaker, I would like to talk about this group of motions, but especially about Motion No. 8. Of course, the main purpose of tax reform and of any tax system is fairness. The tax system takes money for the Government to distribute and match with those who need it. Also tax reform and tax policy give indications as to how we want our society to go.
Of course, I am thinking of several studies and I am sure that most or maybe all Hon. Members will agree that we have a demographic problem; everyone is concerned about what will happen in future with fewer children being born, the declining birth rate and all the problems related to the aging population.
So we need a family policy and it is clear that the reason we in the Liberal Party, the Official Opposition, have to propose amendments is because this Government's tax reform has completely overlooked the family. There is no incentive for the family. How can one have a tax reform and not think of indexing the refundable credits for dependent children? We talk about dependent children. We talk about the family. If we
want to encourage the family, we have only to take the latest Quebec provincial budget as an example. The Liberal Finance Minister understood that a fiscal policy on the family was required and everyone applauded this budget. Here this Government has an ideal opportunity with tax reform-we do not have tax reform every year-but it has completely missed this opportunity. Definitely, the situation for mentally and physically handicapped dependent children is incredible! How can they not index those credits? Any Government of whatever stripe that neglects this aspect is not honest.
Of course, we just heard the Minister whose whole argument was based on the question of cost. Such a motion would cost so many millions, another motion so many millions, and of course we cannot afford it, the Government does not have the money for it. However, Madam Speaker, I do not want to come back to the submarine issue, I do not want to repeat myself, but there are other expenses the Government is committed to. On military expenses, for example, it spent $2.7 million to change the military uniforms. This money could have been spent for families and social justice. Has the $41 million for the prison in Port-Cartier helped families?
When we talk about money, let us put things in their true perspective. The capital gains exemption of $500,000 announced in 1986 by the Minister of Finance (Mr. Wilson) cost the federal treasury $800 millions in 1987. If we want to put things in their proper perspective, let us do it right. Let us be honest: this Government has no family policy. Family is not one of its concerns. If they could tell us what their family policy is all about, maybe we could understand them better, but they don't have any. That is why we have to propose amendments, just as we have been doing since this afternoon, proposing amendments to the child care Bill, amendments to make the tax rate fairer. We are moving amendments to index the tax credit for dependent children, for children over 18 years old, for physically handicapped children, and the Minister still talks about costs. We could spend all night talking about expenditures, and about the money this Conservative Government has been wasting for the past four years.
Madam Speaker, even if they want to make you believe that they have reduced the deficit, later, in one of my motions, I will prove that they have not reduced it at all. They want to make us think that they are reducing the deficit, but after wringing more than $25 billion in extra taxes from taxpayers, they have still not really reduced the deficit because the figures they quote come from an accounting system that they changed to make it look like they reduced the deficit, but in fact, the real deficit still there in spite of $22 billion in tax increases over four years.
Madam Speaker, on this point, I would just like to tell the House that I support Motion No. 8, as well as all the other motions grouped together that come from my colleagues, because I believe that we do need a clear and precise family policy so Canadians can know where we are going and what we have set for Canadian families.
August 25, 1988


Claudy Mailly: Madam Speaker, once more the Hon, Member for Saint-Leonard-Anjou (Mr. Gagliano) served us a mishmash, stating first the deficit was no problem, and then we had not really reduced it, and finally we had reduced it through accounting gimmicks. Once more he confused everything in order to create an impression that this administration has no concern for Canadian families.
This is really ridiculous, because he just stated we debated the child care Bill. In the first place, Madam Speaker, are day care centres for senior citizens? Are day care services for childless couples? Or are they for families with children? He should make up his mind! If we introduced a child care Bill and asked provinces to increase day care spaces, because as you know day care centres are a provincial responsibility and we respect provincial jurisdiction . . .
So we asked them to increase the number of spaces, because we know very well that child care accessibility is what Canadian families need. Here is an initiative which helps Canadian families! Here is a family policy initiative!
Second, Madam Speaker, we introduced in this House legislation against pornography, especially child pornography. Therefore, Madam Speaker, can they blame us for not being concerned with families? No way! We had a lot of difficulty getting the Opposition Members to accept a pornography Bill. They told us we were stuffed shirts, we had no sense of humor, we lacked lifestyle, et cetera, we wanted to police Canada's bedrooms. They did not say: Hear, hear! We wanted to protect the dignity of women, we wanted to protect the dignity of Canadian families, we wanted to protect children, the innocence of children. No, they told us we were stuffed shirts, morons, et cetera.
So, Madam Speaker, they should make up their minds. Either we came up with measures to help Canadian families, or we did not introduce them! We did introduce good ones, and the Official Opposition did not support them.
Moreover, we came up with a prostitution Bill. Once more, Madam Speaker, when people complained that their neighbourhoods were invaded by prostitutes, many teenagers of both sexes indulged in prostitution, they could see no way they could bring up their children in a neighbourhood where prostitutes dominated the sidewalks . . . Tell me, Madam Speaker, is a bill against prostitution not a Bill to help family life? Of course it is! I am sorry to state that they left the House, those Members who earlier stated we did nothing .. .
Income Tax Act and Related Acts
but they are not interested in hearing the facts. As I said, emotions come first. They want to wrap emotions around everything in order to hide the facts.
We introduced tax reform because it was needed. Canada went through very difficult times in the 80's, when the inflation rate was so horrendous people lost their homes because they could no longer afford payments on their mortgages. There were so many unemployed people that we were faced with incredible deficits.
And now, Madam Speaker, we are proud to say that we have created jobs for more than 1,500,000 Canadians who are paying taxes. Of course, when the Opposition talk about the increase in taxes collected by our Government, they usually forget to mention that we now have 1,500,000 more Canadians paying taxes. That explains the increase in Government revenues.
What they forget to say when they mention the increase in the sales tax is that, when we took office, we inherited such an increase passed by the previous Government. Why? Because they were out of funds to support the already existing programs.
So, Madam Speaker, they can rise on their feet in this House as often as they want, they can try to act like heroes, they can brag, and say "We are the defender of the weak and the oppressed". But, the truth is that they simply did not do their jobs while they were in office. On the contrary, they created overwhelming economic problems, ruined the economy in western Canada, and harmed Quebec with their hostile policies. Today, we are trying to solve these problems, which explains why they are so annoyed. They don't like to admit that, finally, someone is looking after the people of Canada.


The Acting Speaker (Mrs. Cossitt):: Is the House ready for the question?


Some Hon. Members:: Question.


The Acting Speaker (Mrs. Cossitt):: The question is on Motion No. 8. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mrs. Cossitt):: The motion is negatived on division.
Motion (Mr. Garneau) negatived.

August 25, 1988
Income Tax Act and Related Acts
The next question is on Motion No. 9. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mrs. Cossitt):: The motion is negatived on division.
Motion (Mr. Garneau) negatived.


The Acting Speaker (Mrs. Cossitt):: The next question is on Motion No. 10. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mrs. Cossitt):: The motion is negatived on division.
Motion (Ms. Nicholson) negatived.


The Acting Speaker (Mrs. Cossitt):: The next question is on Motion No. 11. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mrs. Cossitt):: The motion is negatived on division.
Motion (Mr. Garneau) negatived.


The Acting Speaker (Mrs. Cossitt):: The next question is on Motion No. 12. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mrs. Cossitt):: The motion is negatived on division.
Motion (Mr. Garneau) negatived.
[ Translation]


Raymond Garneau: Motion No. 13
That Bill C-139 be amended in Clause 92 by adding immediately after line
47 at page 229 the following:
"1.1) The personal income tax credit established by subsection (1) is
refundable."
Madam Speaker, I would like to thank my colleague from Saint-Leonard-Anjou (Mr. Gagliano) for supporting this motion.
Madam Speaker, this motion amending Clause 92 of Bill C-139 is aimed at bringing to the attention of the Members of this House what I think is a very important issue.
The whole idea of tax reform, we were told, was to bring a greater measure of equity and social justice in our system and to ensure a better distribution of the tax burden between the various classes in our society, between the various income groups.
I have said time and again that the approach taken by the Minister of Finance (Mr. Wilson) and the proposals he has made are completely out of line with the objectives and the principles he himself has outlined in his White Paper on Tax Reform.
There is no relationship whatsoever between what the Minister of Finance says and what he does as far as tax reform is concerned. And an example of this is the whole matter of tax credits given to married persons, dependants, and so on.
Though tax reform was aimed, as I said, to bring a greater measure of justice and equity in our system, a taxpayer who earns a lot of money or quite a bit of money, not hundreds of thousands of dollars, but $35,000, $40,000, $45,000, can get a tax credit, thereby reducing his tax burden. But if the taxpayer is a low-income earner, he cannot get the full tax credit because his income is too low. The tax system proposed by the Minister of Finance therefore gives tax credits to those who have money, but not to those whose income is not high enough for them to pay taxes.
According to the Minister's proposition, if you do not pay income tax you are not entitled to a tax credit. If you have- Madam Speaker, would you call the Member for Gatineau (Mrs. Mailly), to order, she has the right to take the floor in a few minutes and if she wants to speak she should first read the texts.
As things stand now, an individual who does not earn enough to pay taxes is not entitled to the tax credit-no ifs and buts, the law says so-but someone else earning a big income can claim the tax credit. So under the tax reform of the Minister of Finance a person earning a big income will get something back from the Government, but the man or woman who earns a pittance simply does not qualify for this tax credit. This is like a subsidy for people who earn a fair amount of money and a sort of negative levy against those with a limited income.
This is why in Motion No. 13 I suggest we add after line 47 of Clause 92 at page 229 that the tax credit be refundable. This way, all taxpayers regardless of earnings, but particularly those who have no money and those at the bottom of the wage scale or without any income, could at least have the same thing, the same tax credit as someone who gets $250,000 and who at that income level will claim the full credit, like a taxpayer who gets paid $40,000 or $45,000.
As I see it, the refundable tax credit is the approach the Minister of Finance should have taken in his tax reform because that would have been the only way for him to achieve the goals he outlined in his remarks when he tabled the White Paper. The problem I have with the tax reform-and we could see that for ourselves during the many weeks when the parliamentary committee heard the testimony of a number of Canadians, accountants, and what have you-is that we were told over and over again that the legislative text and the recommendations do not square with the principles which had been established by the Minister and the Conservative Government.
August 25, 1988

The purpose of my amendment therefore is to have the tax reform reflect the words of the Minister. 1 think that the refundable tax credit approach is more equitable from both a social and a tax standpoint. It would be the first step towards a kind of guaranteed minimum income which, I suggest, would be a lot fairer, much more effective, and a much better incentive to a return to the labour market than all the formulas we have now. That is something the Minister has failed to achieve with his tax reform because the wording in this piece of legislation simply does not jibe with the principles he talked about when he tabled his paper.


Claudy Mailly: Madam Speaker, I should like to quote a booklet published by the Department of Finance under the title "Tax Reform 1987: A Summary for Taxpayers". On page 5, it is stated: "The key to making the personal income tax fairer is replacing personal income tax exemptions and some deductions with tax credits. Exemptions and deductions reduce taxable income. The value of an exemption or deduction depends on an individual's tax bracket and tax rate. Tax savings are the greatest for higher-income individuals." To put it more simply, Madam Speaker, I will say that until this Government proposed to move from a system a deduction to a system of tax credit, people in higher income brackets benefited more from deductions.
Let me give you an example: Suppose that you earn a salary of $40,000, that your tax rate is, say, 30 per cent, and that you are entitled to a $3,000 deduction; because you would have to pay 30 per cent on these $3,000, you would have saved $1,000 in taxes. But if you had a salary of $15,000, with a tax rate of 10 per cent on this $3,000 deduction, you would have saved only $300 on that amount. If such is the case, how can a former Quebec Minister of Finance tell the Elouse that we moved from a system of deduction to a system of tax credit to help the affluent? On page 5 of that booklet which was distributed free of charge to all Canadians, it is clearly stated that the tax credits are the same for all. In other words, whether your income is $27,500 or $55,000 a year, your personal exemption, which is a credit, will amount to $1,020.
Until now, a taxpayer with a $27,500 income would have had a very small credit, a very small deduction, because his or her tax rate was very low, while the taxpayer with a $55,000 income would have had a very large deduction. The fine print is that a $27,500 income resulted in a $725 deduction, while a $55,000 income resulted in a $1,240 deduction, which is almost twice as much. With the tax credit system, the taxpayer with a $27,500 income and a taxpayer with a $55,000 income are both entitled to a personal $1,020 tax credit. How can the Hon. Member suggest that we are favouring the affluent and only people on higher income brackets? It is quite the contrary, Madam Speaker! The purpose of the conversion was to help lower income people.
Moreover, he said that a person must earn a lot of money to be entitled to a tax credit. What he means is that a person must earn enough money to pay taxes. But there are refundable tax credits. Even if you do not pay a single cent in income
Income Tax Act and Related Acts
tax, you are entitled to the refundable sales tax credit. All you have to do is fill in your income tax return and say: I owe no income tax, but I am entitled to a sales tax credit of $50 for every member of my family. And these $50 per person largely offset the sales tax increase that had to be brought in because there was no money to maintain existing social programs. Consequently, it is rubbish to argue that there is no equity in such a system. It is rubbish to assert that one has to earn a lot of money to get a tax credit which is refundable.
And as far as indexation is concerned, what the Hon. Member for Saint-Leonard-Anjou is not saying is that he is talking about a 3 per cent reduction of a cost of living indexation. In terms of old age security pensions, this meant approximately $7 a month. He is talking about millions, even billions for nuclear powered submarines but he is not saying that even if the family allowances indexation had been maintained, Canadian families would not have gained more than $2 or $3 with inflation above 3 per cent. Fortunately, the inflation rate is about 4 per cent right now. Why? Because we, the Conservatives, have had the courage to take steps which the Liberals have shied away from for decades. This is how we succeeded in cutting down the deficit, four years in a row. Moreover, we have reduced both inflation and interest rates, we have created jobs, we have put back to work 1,500,000 Canadians, 70 per cent of which are women, and 80 per cent of those jobs are full time jobs. Therefore, they can say what they want, Madam Speaker, but they have nothing to offer except a lot of eyewash.


Thomas Hockin: Madam Speaker, I would like to speak to this motion because I guess I have seldom seen a motion on tax reform that is so fiscally irresponsible as this one. I choose my words carefully. This particular proposal would cost the Government of Canada $4 billion. The provinces would be matching it, and it would cost them $4 billion. This is an $8 billion proposal. It is a proposal from a kind of limousine Liberal approach that would drive the whole country to the poor house.
What happens with this proposal is that we would give a refundable personal income credit to everybody; a newborn child one day old would get it, a 12-month old child would get it, a housewife who is not going to work but can stay home all day long would get it. Everybody would get it. This particular proposal is the most fiscally irresponsible proposal that I think has ever come before the House. If in fact we ever did such a thing, we would end up hurting the very people that we want to help, that is, those who have the most difficulty economically in getting through life, the lowest incomes, because the provinces of course would cut back their social assistance.
When they found out that you had another $1,000 or whatever income, they would simply cut back their provincial assistance. This proposal costs $8 billion, but it does not even

August 25, 1988
Income Tax Act and Related Acts
accomplish what the Elon. Member wants it to do. 1 cannot understand the thinking behind this and I cannot believe that if that Party were in government it would ever bring it in. Why did they propose it tonight? They proposed it because they do not have any coherent ideas themselves about what they want to do in tax reform. This particular proposal would cost so much money that no matter what good ideas a government would have, they would not have the funds to dispense.
This kind of credit is not only fiscally irresponsible. It would not only refund over $1,000 annually to spouses who could stay at home or to wealthy corporate executives who do not need the money; everybody would get it. This whole notion of a progressive tax system would be fundamentally undermined by this proposal.
As I say, too, unfortunately much of the assistance that would go to lower income Canadians would simply be deducted by the provinces because of the income that would be picked up by this proposal at the federal level. To debate this much longer is to dignify a proposal which I do not think any credible economist or Minister of Finance would ordinarily recommend.
If in fact all that is meant in the motion is that the credit for dependent children should be refundable, that is not the way that the motion reads. I would remind the House that the refundable child tax credit is in place. This is the appropriate mechanism to ensure that it is properly targeted, and it has increased significantly by this Government, from $367 in 1985 to $559 in 1988, an increase of more than 50 per cent in just three years. We are targeting it.
Good economic management is to target properly, to help those who are in most need, but also to be fiscally responsible. This particular proposal does the exact opposite on both counts.


The Acting Speaker (Mrs. Cossitt):: The Chair apologizes to the Hon. Member for Vancouver East. She should have been recognized before the Minister of State for Finance.


Margaret Anne Mitchell: Madam Speaker,
I would just like to speak briefly to Motion No. 13. I think that the New Democratic Party supports the philosophy of refundable tax credits. We would agree that one of the more positive policies from a social point of view is the fact that the child tax credit is refundable. I am sure that this would apply with other forms of tax credits, perhaps the sales tax credit, for example, which I understand is about $50 per person. Why should that go only to people who pay income tax when it is the marginal people who do not earn enough to pay very much income tax, or those who do not earn enough to pay any income tax? Surely, they should be able to take advantage of that. It would make sense to make it refundable, so that it applies to those who do not have enough income tax to declare but still should have the benefit of the tax credit.
Another aspect to think about from a social policy point of view is that this is the beginning of the mechanism that a
number of people feel is a start on a form of guaranteed income in Canada. We very much need to find a way and a mechanism for redistributing incomes that will benefit lower income people and that will tax higher earning people at a much greater rate. By redistributing this through refundable tax credits, it would mean that lower income people would receive more.
The Minister pointed out differences between provinces and the federal Government. I think that that would be a point of negotiation to work out. Basically we are in favour of the principle of refundable tax credits.


Mr. Vic Althouse (Humboldt-Lake Centre):: Madam Speaker, I do not intend to make a long speech. I see that the Minister had to leave the Chamber, but there are a couple of questions that occurred to me when this question of refundable versus ordinary tax credits came up. The Minister expressed great concern that making all tax credits refundable could have the effect of costing the federal Treasury something like $4 billion, which he felt would be matched by the provincial governments. He then went on to explain that while it would cost the provincial governments in income tax, they would save a like amount through the welfare system. It is basically with the federal Government that the cost accrues.
The question that I want the House to consider a little is: If the Government, any government now or in the past or in the future, is proposing a tax credit and begins the practice of making it a refundable tax credit, will that not make governments a little more specific about why they are putting the tax credit in place in the first place?
There is not much point in pretending to have a universal tax credit for individuals for sales tax, as my colleague from Vancouver East has pointed out, if the low income people for whom the general public thought that tax credit was being put into effect could not take advantage of it. The only way that those kinds of programs make any sense is if they are refundable tax credits. What is the point of having a refundable tax credit if the bulk of the poor people do not have enough income tax against which to write off the tax credit?


Claudy Mailly: That is what they are. It is a refundable tax credit.


Victor Fredrich (Vic) Althouse: We are saying that if there is a tax credit, make all of them refundable or be more careful about what you make a tax credit for.


Claudy Mailly: That is like saying everything that has wheels is a car.


Victor Fredrich (Vic) Althouse: We are proposing that if there is a tax credit it be made a refundable tax credit in every case. As I understand the motion, that is what is being proposed, yet the Minister was telling us that if we do this it will cost the federal Government $4 billion.
August 25, 1988


Claudy Mailly: How can you have a tax credit on tax that is unpaid?


Victor Fredrich (Vic) Althouse: If I may complete my remarks, Madam Speaker, the Hon. Member shouts: "How can you have a tax credit on tax that is not being paid?" That is precisely the point 1 stood to make, had Members opposite been here at the beginning of my remarks. The reason for having the tax credit was to give poor people a tax break on sales tax. Therefore there ought to be a refundable tax credit.


Claudy Mailly: It is refundable.


Victor Fredrich (Vic) Althouse: All other tax credits that are put forward with the same argument need also, we are saying with this amendment, to be refundable tax credits. If that is not the intention, then we are saying that the Government should not put them forward as tax credits unless they are refundable as tax credits.


Claudy Mailly: They do not pay income tax. They are below the tax level.


Victor Fredrich (Vic) Althouse: The Hon. Member has presented an argument to the House already. I understand that if they do not have the income they will not be able to take advantage of those tax credits that are not refundable. That is the point of putting forward the amendment. The social reason for having put it forward, presumably, was to give them a break because people need it.


Claudy Mailly: They need a job.


Victor Fredrich (Vic) Althouse: If you are not prepared to follow through with it, there is not much point putting through a tax credit unless it is refundable. That is the only point we are trying to make with this amendment.


Claudy Mailly: They need a good, well-paying job.


The Acting Speaker (Mrs. Cossitt):: Is the House ready for the question?


Some Hon. Members:: Question.


The Acting Speaker (Mrs. Cossitt):: The question is on Motion No. 13. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mrs. Cossitt):: Motion No. 13 is negatived on division.


Raymond Garneau: Motion No. 14
That Bill C-139 be amended in Clause 97 by striking out line 13 at page 260 and substituting the following therefor:
"(ii) $25,590"
He said: Madam Speaker, the purpose of this motion is to increase by $1,500 the threshold at which the refundable child
Income Tax Act and Related Acts
tax credit begins to be reduced. This amendment will simply re-establish the pre-tax reform threshold.

Madam Speaker, the purpose of Motion No. 14 which I am proposing and which, if passed, would amend Clause 97 of Bill C-139 is to raise by $1,500 the net income threshold over which the refundable dependent child credit begins to be reduced.
In fact, this amendment seeks only to bring the income treshold back to what it was before tax reform.
Madam Speaker, once again, justice and equity are our considerations in moving this motion in an attempt to correct the approach which the Minister of Finance (Mr. Wilson) and his colleague the Minister of State for Finance (Mr. Hockin) have taken in this tax reform one which I can only describe as being utterly mean heedless of families' needs.
We are proposing to raise from $24,090 to $27,590 the net income threshold over which the refundable child tax credit begins to be reduced because tax reform has changed the definition of net income. It has been changed because some deductions which were allowed before and on which net income was based have been eliminated. For instance, contributions to a pension fund, to the Quebec Pension Plan, to the Canada Pension Plan for those who live in provinces other than Quebec, to unemployment insurance and the $500 employment income have all been done away with, and the definition of "net income" has thus been changed without any amendment to the legislation itself.
The normal thing to do, Madam Speaker, would be to bring the level back to what it was before. Before tax reform, married couples with children who were entitled to the refundable tax credit saw that credit diminish once their family income reached about $25,500. Under tax reform, and because of the changes introduced with regard to contributions to the Quebec Pension Plan, unemployment insurance and the $500 employment income, the child tax credit will now begin to decrease at the $24,000 treshold. Before tax reform, families earning $1,500 more than that could get the full child tax credit amounting to some $500, but after tax reform, that credit will start being reduced, not at an income level of $25,590 but of $24,000.
I think it is turning everything upside down and I hope the Hon. Member for Gatineau (Mrs. Mailly) and the Minister of State (Finance) will at least recognize that. I don't know if the Minister has forgotten, but we have raised that issue at other times during debate and it seems that nobody wants to understand that low-income families will see their child tax credit reduced while their income is at the same level as before tax reform.

August 25, 1988
Income Tax Act and Related Acts

I think this motion should be accepted. The net effect of the fiscal reform is that the definition of the net income for personal income tax has been changed. The contributions to the Canada Pension Plan and to unemployment insurance and the $500 exemption all disappear. The net income before and the net income after fiscal reform is not the same. The family with children who would receive the refundable child tax credit will have seen that child tax credit diminish if it has a net income of over $25,590. That will be reduced to $24,000.
This motion should be adopted. I will seek the support of all Members on both sides of the House to bring back the same level of income for those families in great need who otherwise would see their refundable child tax credit diminish at a very low personal income level.

Therefore, I ask the Government and the Conservative Members to think it over before refusing that amendment which would only bring things back to what they were before.
1 would also like to say, Madam Speaker, that with partial de-indexation of the child tax credit that the Government refused to re-index earlier, we are greatly increasing the difficulties facing Canadian families, who are hit hard by the Minister of Finance and the Conservative Government and their tax reform. The child tax credit is now de-indexed but it will be reduced to an income level which is the same as last year but has been affected by tricky changes the Minister of Finance hasn't been willing to correct so far.


Margaret Anne Mitchell: Madam Speaker,
I would like to support this motion on behalf of the New Democratic Party. However, 1 wonder if the Liberals realize that they are being somewhat conservative in the level of the turning point for the child tax credit for which they are asking.
I am trying to recall the study we did almost two years ago on the reform of family benefits. If my memory serves me correctly, when we studied the amount of the child tax credit, we discovered that the Conservatives had reduced the level considerably from where it was under the Liberal regime when it actually went to average marginal families. It seems to me that if we really care about children, about struggling families, and about the one in five children in Canada who are poor, then we have to give higher priority to the family benefits that will benefit children. The child tax credit and the family allowance are the best vehicles for doing this.
The Government has deindexed by 3 per cent the family allowance and the child tax credit as well. 1 am not sure if the Liberals had maintained full indexation for the child tax credit or not. At the time of the family benefits study, we proposed that in order to bring the turning point for the child tax credit higher, the credit itself should be increased by 80 per cent. I
think that would have brought it up to where it would have been under the Liberal regime. We felt as well that it should be fully reindexed because if it is not reindexed, it then goes down progressively each year. It is very hypocritical to say that we are giving extra credits to poor families when in fact the basic child tax credit is going down in value by the 3 per cent deindexation every year.
If we care about children, and if we want to do something about child poverty, we have to give higher priority to benefits for families, particularly the child tax credit. This is one step forward. We would be more generous in that we would want an 80 per cent increase.
I believe this clause also covers the new $100 child care credit which will go to $200 in 1989. This would be available only to families with children under seven years of age and only to very low income families. As I have said many times in this House, I think any mother at home struggling to raise children will not feel that $200 recognizes the value of her work. She would much prefer a more generous child tax credit that is refundable. As well, the $200 for those parents who use informal baby-sitting arrangements is a big laugh when we think how much it costs per year for baby-sitting arrangements. Even if it is not licensed care, it is still expensive, and $200 is almost an insult.
1 do not think the Conservative Government is realistic. Conservative Members talk about families and children, but they will not do anything substantive to remove child poverty.


Thomas Hockin: Madam Speaker, quite frankly, increasing in three years 50 per cent of the expenditures on any social program shows a very important priority. In fact, the child tax credit has been increased by this Government from $367 in 1985 to $559 in 1988. That is an increase of more than 50 per cent in three years.
The Liberal motion wants to increase the refundable child tax credit threshold by $1,500. The increase of $35 we have brought in for the child tax credit achieves much the same goals simply by a different means. I do not know what this motion really accomplishes.
For example, in 1988, partial child tax credit benefits will be provided to a one-earner family with two children and with an income of up to about $46,500 as compared to $45,000 for the same family under the original White Paper proposal. Moreover, these changes benefit all families who qualify for the refundable child tax credit at all income levels rather than just those whose family income is above the current threshold. This improves the progressivity of the child tax credit and the benefits system in particular and of the tax system in general.
This motion is unnecessary. I ask the House to defeat it, but I must ask another question of the Hon. Member for Vancouver East (Ms. Mitchell). Perhaps she can respond to this when she speaks on the next motion, as would the Hon. Member for Humboldt-Lake Centre (Mr. Althouse). I hope Hon.
August 25, 1988

Members heard this. They would give, as would the Hon. Member for Laval-des-Rapides (Mr. Garneau), the personal exemption credit to all Canadians, whether they had to pay tax or not. In other words, a child who has just been born would get it. A person who earns no income would get it. This would cost the Government of Canada $4 billion. I could not believe it, but they did say that. They believe in spending $4 billion that way when it would simply reduce what the provinces would end up giving because of their increased revenues. The targeting that we have achieved would be totally dissolved in essentially a fiscal haemorrhage. I ask that Hon. Members defeat this motion.


The Acting Speaker (Mrs. Cossitt):: Is the House ready for the question?


Some Hon. Members:: Question.


The Acting Speaker (Mrs. Cossitt):: The question is on Motion No. 14 standing in the name of the Hon. Member for Laval-des-Rapides. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: No.


Some Hon. Members:: On division.
Motion (Mr. Garneau) negatived.


Raymond Garneau: Motion No. 15
That Bill C-139 be amended in Clause 102 by striking out line 18 at page
265 and substituting the following therefor:
"amount equal to 18 per cent of the least of'.
He said: The purpose of this amendment is to reduce from 12 per cent to 10 per cent the taxation rate of all small businesses.


Abram Ernest Epp: Mr. Speaker, I want to take a few moments to speak to Motion No. 15 presented by the Hon. Member for Laval-des-Rapides (Mr. Garneau). The motion he put forward in the name of small business is certainly worth considering in those terms. However, it gets a bit more complicated than that.
Obviously our economy is all too dominated by very large enterprises which manage to do very well in comparison to small businesses. Small businesses find themselves all too often under-capitalized and forced to turn to financial institutions, particularly our chartered banks, for support. They have often found those banks in these last few years not nearly so sympathetic to their needs as has been true in the past.
Certainly small business has reason to be concerned about the tax rate. As the critic speaking on behalf of the Opposition suggested, to have the Minister of Finance (Mr. Wilson) promise an 8 per cent rate to small manufacturing businesses, and having obtained credit in industry for doing that, and then turn around and hand them a 12 per cent rate, is only one more example of the breaking of faith which has marked the Government. It demonstrates the greediness of the Minister of Finance and his blind desire for revenue as it has been applied to small enterprises and individual taxpayers. In case after case the Minister has gone after small operators, small people, small companies, and allowed the big ones to get away with lesser payments or no payments at all.

August 25, 1988
Income Tax Act and Related Acts
That kind of economic situation would certainly justify support for this amendment. The difficulty with it for us in the NDP caucus is that the Canadian controlled private corporations to whose profits its rate reduction from 12 per cent to 10 per cent applies are characterized not by their necessarily being small businesses but by the anomaly, if you will, of being a big corporation.
There is in the nature of our corporate law something that strikes me very often as a contradiction in terms. You have a business as large as Eaton's, for example, which operates from coast to coast. It has a long history, a long and venerable history one would like to say, although I am not too sure I want to say that as a New Democrat being well aware of the labour policies of the Eaton family over the years, of being a supposedly private corporation. It has been closely held by the family and those involved with it, and because of this anomaly of corporate law it has been allowed to get away with reporting very little of its activities. This great company operates in the cities across our country. It pretends it is like a corner store. Conceivably one might argue this is the kind of private business in which the public has a limited right to know what is going on.
One could expand on this strange thing in our corporate law which allows such a company to be private in this way, but what counts is that companies such as Eaton's, which are Canadian controlled private corporations, would end up in this amendment the recipients of what is supposed to be a small business rate. Surely what is necessary if this kind of amendment is to be genuinely a small business rate, as the Hon. Member for Laval-des-Rapides said it was, is that there must be some other quantitative measure of what is genuinely a small business.
There is a number of ways of doing that. One could use as a measurement the number of employees. A small business might be 50 or 100 employees or conceivably more than that. One could use sales as a measure, whatever the figure happens to be, some several million, perhaps. One could use this as a way of distinguishing small businesses under that level from the large ones over it which one would not want to call small businesses.
Clearly there are a number of objective standards that could be applied, and I have no doubt that the Department of National Revenue would have the information at hand or be able to obtain it in order to draw these distinctions. If there is any difficulty in getting it from some of these private corporations, it is quite, quite timely to ensure that they report in the way that American companies have to report information to the authorities. We should long since have done that with Canadian corporations which have gone beyond this charade, I would say, of supposed private corporations. If the law has to be amended to get us some information, it might only have to be filed with Revenue Canada. It would not have to be published for all those who are concerned to protect the privacy of these supposed private enterprises.
Those are the kinds of concerns we feel about this particular amendment. We clearly want to support that part of it which is relevant to small business. The fact that it has the wrong qualifications in it with respect to Canadian controlled private corporations leaves us much more ambivalent. In the context of the votes this evening on division, of course it is not going to matter actually how we come down on this, but it is a motion which clearly is useful in spirit but should have been far more carefully drawn in the actual letter of the amendment.


Thomas Hockin: Mr. Speaker, 1 listened very carefully to the Hon. Member for Thunder Bay-Nipigon (Mr. Epp) because of a number of questions posed in this House by his Party complaining about the number of corporations in Canada that do not pay tax. Do you remember those questions, Mr. Speaker? Tonight he is saying that we should lessen the tax burden on small business. The Hon. Member has admitted tonight that in fact most of the corporations which do not pay tax are small businesses struggling to get under way. When he asks me in the future about corporations that do not pay tax I will remind him that what he said tonight is a contradiction to all the questions he asked previously.
More important is the actual motion itself. I can deal with it very quickly. First, the 12 per cent small business rate is one of the most generous in the industrialized world. If you compare with other countries you will find that this rate is as low as you can find almost anywhere in the top 30 countries in the OECD. Therefore, we are taxing our small businesses at a very generously low rate.
Why not 10 per cent instead of 12 per cent? This proposal would cost the Consolidated Revenue Fund about $25 billion. There are a lot of things that can be done with those funds.
Third, and most important, is the point which the Hon. Member made, with which I agree, that all corporations, on the first $200,000 of revenue, would be taxed at a lower rate. That would help the large corporations as well as the small ones.


Abram Ernest Epp: It is a Liberal motion.


Thomas Hockin: It is a Liberal motion which you are supporting.


Abram Ernest Epp: No, no, we are equivocal about it.


Thomas Hockin: With regard to why we are leaving it at 12 per cent, the House will be interested to know that the rate of the dividend tax credit has been reduced under tax reform from one-third to one-quarter. This amount integrates perfectly with the 12 per cent corporate tax rate so as to ensure that corporate income that is subject to taxation at the small business rate is not taxed inordinately heavily as it is distributed by way of dividends to the shareholder. If the small business rate was to be reduced to 12 per cent, the dividend tax credit should also be reduced, otherwise too great a credit will be available.
August 25, 1988

Thus, the total tax on income, flowed through a corporation, would be less than tax on the shareholder if he earned the income directly. We are keeping the 12 per cent in order to ensure that these two are in balance and symmetry. Reducing the dividend tax credit further than has already been done by tax reform would have extensive repercussions in the public capital markets.
Once again, the Hon. Member for Laval-des-Rapides (Mr. Garneau) has proposed an amendment which moves in a contradictory direction to what even he intended.


Alfonso Gagliano: Mr. Speaker, this motion proposed by the Hon. Member for Laval-des-Rapides (Mr. Garneau) and the motion that 1 presented, which was ruled out of order, are meant to correct the injustice that the tax reform proposed by the Conservative Government does to small business.
So far, we had a tax system that allowed manufacturing companies a lower tax rate; there was a reduced tax rate for large manufacturing companies and a reduced rate for small manufacturing companies. Even the Minister of Finance (Mr. Wilson), when he first presented his corporate tax reform, maintained this differential treatment and then proposed a reduced tax rate for small manufacturing companies, 8 per cent instead of 10 per cent. So the Minister of Finance wanted to continue along the same lines as we have for decades in Canada.
Since tax reform, the Minister of Finance has changed completely. Instead of continuing the tax reduction for small manufacturing companies, he increased the rate by 2 per cent. It is the only sector in the whole tax reform that is hit with a direct tax increase. Also keep in mind that this sector is hit by the lower capital cost allowance. The CCA was reduced across the board, so it applies to small business as well.
When the Minister says that the Conservative Government was generous to small business by increasing its tax rate 2 per cent, I would like him to define what he means by generosity for us. It is the only sector hit with a tax increase under tax reform. It is the only sector that creates more than 80 per cent of our jobs. Why then penalize the sectors which make the economy thrive? Is that good leadership? It is this unfair treatment of a sector which provides most of our jobs that we wanted to eliminate. Because the Standing Orders of the House prevented us from proceeding as we intended, we had to resort to this amendment in order to deal with the issue.
Mr. Speaker, we submitted this issue to the Finance and Economic Affairs Committee and once again we were given the same answer. We are told that we are too generous. Today I am asking the Finance Minister again to increase by 2 percent the small manufacturing businesses tax rate. Is that
Income Tax Act and Related Acts
too generous? Is that excessive generosity? I am sure that the small businesses will remember that come the next elections!


Don Boudria: Mr. Speaker, we cannot possibly have the question now, I have not yet had the time to make my contribution in this debate. I am hoping that my words will influence the Parliamentary Secretary, the Hon. Member for Gatineau (Mrs. Mailly), to change her position in favour of the right one which is the one we are suggesting.
I want to compliment the Hon. Member for Laval-des-Rapides (Mr. Garneau), and I say that in a totally objective and non-partisan manner, in my usual way.
We could do even better than this, we could withdraw this amendment and ask the Government to do the right thing, that is, lower income tax for small businesses. However, we on this side of the House know that the Conservatives do not have a tendency to assist small businesses because they are too busy assisting big businesses. That is the nature of being a Tory and I accept that. My colleague from Laval-des-Rapides very astutely recognized that and proposed an amendment, the purpose of which is to lower that level of taxation.
My colleague wants to do this for a very simple reason. The current rate of income tax for general business is 36 per cent. Under tax reform that is reduced to 28 per cent. That sounds like something to applaud. If you group everyone together the rate is lowered by 8 per cent. That sounds good. However, the catch is that for small business in manufacturing the rate goes from 10 per cent to 12 per cent. Would you believe that the rate is actually going up from 10 per cent to 12 per cent under the Conservative administration? I do not want to belabour the point because my colleague from Saint-Leonard-Anjou (Mr. Gagliano), who is an expert in small business, has spoken very eloquently on this, as has my colleague from Laval-des-Rapides.
Given the constructive input I have just made, I hope the Government will agree with us and will vote in favour of the Liberal amendment.
As for the New Democratic Party, which is ambivalent about how it will vote, according to its words, I hope it will reconcile itself to vote for one side or the other. I hope they choose the right side, the Liberal side.


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


Some Hon. Members:: Question.


Mr. Deputy Speaker:: The question is on Motion No. 15 standing in the name of the Hon. Member for Laval-des-Rapides (Mr. Garneau). Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.

August 25, 1988
Income Tax Act and Related Acts


Some Hon. Members:: No.


Mr. Deputy Speaker:: All those in favour of the motion will please say yea.
I declare the motion negatived.
Motion (Mr. Garneau) negatived.


Alfonso Gagliano: Motion no. 17
That Bill C-139 be amended by deleting Clause 137.
He said: Mr. Speaker, for the past two years, the Conservative Government has been using all the means at its disposal to make us believe it is reducing the deficit, when it is actually using a different accounting system to fool Canadians, so that when it says it is reducing the deficit, it is not doing that at all.
Mr. Speaker, for starters, the first measure accelerated the remittance of source deductions. As a result, the Minister was able to assemble the sum of $2 billion, just once, and subsequently, we were shown a drop of $2 billion in the deficit, while in fact there had been no reduction in expenditures or increase in revenue. It was just that one time when, instead of getting the money before April 15, it came in before March 31, so the Minister had $1 billion more in his fiscal year.
Mr. Speaker, the following year we got the accelerated remittance of federal sales tax. A nightmare for small businesses, Mr. Speaker, because every month the remittance must be made by estimating what the sales tax will be, and then the following month, the books have to be reconciled to calculate the exact difference-add and substract! Imagine, Mr. Speaker, the kind of nightmare this is for small businesses!
How can the Government say it is concerned about this sector? We have just considered a motion to increase income tax for small businesses.
The Government's tax reform is going to take money out of the pockets of low-income Canadians and senior citizens, with their modest pension and investment income, Mr. Speaker!
So what is the Government suggesting? The Government wants to change quarterly remittances. Everybody look at the calendar! According to us, the first quarter is up to the end of March. From now on, according to the Canadian Government, it will be until March 15, so two weeks early. Mr. Speaker, this was how they got another billion dollars to reduce the deficit, although they don't reduce anything because they just collect $1 billion two weeks early.
But we have to take into account the fact that for the Government, the fiscal year ends on March 31, and each time it announces early remittances, and it invariably does so before March 31, the Government can claim a reduction in the deficit, but this is simply not the case because all it is is a change in accounting rules.
But here, we are not dealing with source deductions, held by employers and deducted from employee paycheques or sales
tax to be remitted. That would simply involve accounting methods of working capital.
This time, Mr. Speaker, we are talking about taking money out of taxpayers pockets, from those who need it the most. I am sure that senior citizens come to see you too, Mr. Speaker, in your constituency office with their quarterly form that they do not understand, while the Government is charging $1.29 interest because they sent it in a day late, after attempting to figure out their year-end remittance and finally losing everything. Can you imagine that they must now get used to paying remittance on March 15, June 15 and September 15 instead of at the end of the month? Why, Mr. Speaker? Not too long ago, last week in fact, we had that same debate in the House and before officials of the Finance Department could figure out how much that measure would cost, even Conservative Members said that we could not possibly do such a thing to our senior citizens! As if it were not enough to try to reduce their pensions, we now want to pick their pockets.
And when I suggested to the Committee on Finance and Economic Affairs that we should delete the clause changing quarterly remittances, even Conservative Members agreed, Mr. Speaker. We had deleted that clause, Mr. Speaker. But officials went to see them one by one at dinner time and the Government Members said no, it's not possible! Just like the Minister of State (Finance) said all evening ... It costs $20 million so we cannot accept it! Civil servants calculated it would cost $20 millions in interests. Since we could not afford that, the Conservative Members came back at the end of the evening, and voted conclusively to finally reintroduce this clause . . . For all these reasons, Mr. Speaker, I am standing here tonight to propose again the same amendment. We simply cannot do this to our senior citizens. If the Government want to put an end to their working capital problem, they should look elsewhere for a solution, not at our senior citizens and our low income people. This is ridiculous, Mr. Speaker, fifteen days! They have enough trouble as it is simply to reconcile their quarterly remittance.
Mr. Speaker, tonight, throughout this debate on tax reform, we have clearly seen the Government's hypocrisy. They want us, and all the population, to believe that they are reducing the deficit, which is not true, and all that time they are taking money from people who really need it. That is why I move to delete this clause, and I hope the House will support my amendment.


Don Boudria: Mr. Speaker, I wish to make one last attempt to convince the Government of the validity of removing Clause 137 from the Bill. I draw this to the attention of the Deputy Government House Leader (Mr. Lewis).


Alfonso Gagliano: He is an accountant. He should understand.
August 25, 1988

Income Tax Act and Related Acts


Don Boudria: Yes, he is an accountant so he should know how to count.


An Hon. Member:: He is a lawyer, too.


Don Boudria: No one should have to apologize for being a lawyer. We do not hold that against the Minister, as you would appreciate, Mr. Speaker.
I want the Deputy Government House Leader to pay attention, because we will ask questions later. The parliamentary committee discussed this Bill in its usual objective fashion. All the committee members reviewed Clause 137, when suddenly one Member, then another and finally all members of the committee agreed that Clause 137 should be removed because it was unfair.
The issue was put to a vote and the committee decided to remove Clause 137. The Assistant Deputy Minister who was in attendance got quite upset and banged on the table so hard that the hub caps nearly flew off the Minister's limousine.
During the dinner hour the Assistant Deputy Minister had time to lobby the individual Conservative members of the committee. After having feasted on the meal, the Conservative Members suddenly had a change of heart and reinstated the clause which they had removed before the dinner hour. When the Conservative members were hungry they were willing to remove Clause 137 because they recognized that it was unfair. After they had feasted, however, they returned to their old Tory selves and reinstated the clause in question which would make senior citizens and many others who have to remit on a quarterly basis do so 15 days before the end of the month.
Apart from everything else, this is mathematically incorrect. How can one talk about quarterly remittance when someone has to remit at a period which has nothing to do with a quarter of the year? If one remits in the last half of the month of the quarter, it is not quarterly, it is something quite different. It is a Tory quarterly period, as my colleague says.
I will let the Conservatives figure out the fraction. It strikes me that it is something quite different from a quarter.
The Government wants to advance the payment by 15 days in order to get an extra bite out of the taxpayers before the end of the tax year. As my colleague said so eloquently, this is exactly what the Government did with the corporate sector. It is now imposing it on individual Canadians.
Conservative Members and all members of the committee recognized this and removed that section because it was unfair. However, as I said, after the Assistant Deputy Minister became really angry, we saw who the real boss is. It was obviously not the Conservative Members because they were whipped into line after having feasted and they came back and reinstated the offensive clause. If there are any Tory Members who have not feasted tonight and are still hungry, I say to them, let them go back to the good selves they were the day their hunger for votes made them withdraw that clause. Why do they not do the same thing now? If it was right then, surely, it must be the right thing to do now.


Raymond Garneau: Mr. Speaker, I would like to speak on the proposal made by my colleague from Saint-Leonard-Anjou (Mr. Gagliano). The goal of this motion is to eliminate the change that has been made by the Minister of Finance (Mr. Wilson) in his fiscal reform concerning the remittance of tax instalments that must be made quarterly by self-employed workers and that must now be made at an earlier date than before.
Mr. Speaker, that measure in itself is inconceivable, but on top of that, it is being concealed in another way by postponing its implementation until after the election. They forgot to ... I do not know why, Mr. Speaker . ..


An Hon. Member:: Coincidence!


Raymond Garneau: ... a coincidence that must ... 1 do not know exactly how it is that we have a fiscal reform that is coming into force on January 1, for the most part except that Clause 137 of the fiscal reform concerning earlier remittance of tax instalments by self-employed workers is now being postponed until fiscal year 1990.
Of course, Mr. Speaker, if that measure had been implemented openly as of today, self-employed workers and especially senior citizens would have been so offended by this petty trick from the Conservatives that they decided not to take any chance and to postpone the whole thing until after the election, just as they did for sales tax reform.
Mr. Speaker, do you know how much this represents in a given year, when it is finally done? It is as if the Government had received $1.1 billion more in revenue during the year when it is implemented.

There is $1.1 billion more for the Canadian Government for only one year. Can you imagine, Mr. Speaker, in that year, the Tory Government could say it has diminished the deficit by $1.1 billion, but, in fact, that will not be the case, as it has not been the case when the Government changed the remittance day for the personal income tax. It was not the case when the Government changed the remittance date for the sales tax. That was a trick the federal Tory Government used to try to tell the Canadian people that its deficit was lower and so it was able to tell a few stories about it.

Mr. Speaker, when one considers the three measures taken by the Federal Government in the past few years, one can understand why it was able to boast about artificial lowerings of the deficit. This time around, they did not take the risk of doing it right in the middle of an election year. It will be done only in 1990 because given was is going on now a days, sure enough, there will not be any election in 1988, but rather in 1989. That is the last chance, so they said "Let's do it in 1990!". No problem, they said, let's hit them right now and they will make their remittance at this time.

August 25, 1988
Income Tax Act and Related Acts
Clearly, they will not be in Government then, but the ones who will still be in Opposition might have the gall to blame the Liberals for it.
Mr. Speaker, I am saying that senior citizens are the ones most severely hit, because people with an income from employment or from a business, whether they are lawyers, accountants or something else, will not have any problems as their money is coming in on a regular basis-daily, weekly or monthly-and moving up the date of remittance of their taxes to the federal Government will not be as critical. However, senior citizens on fixed income, either pension income, paid at the end of the month, or interest income, paid maybe every six months or even annually in the case of Canada Saving Bonds, might have to pay taxes four times a year on an income paid on given dates.
The Government, whether it is Red or Blue, cannot take into account all types of income, but changing the date of remittance from the end to the middle of the month is a hassle for everyone. If the Government gets a billion more that way, it means that someone is not getting the interest on that money, and that someone is the taxpayer. This is a devious way for the Conservative Government to show that in this one year the deficit has been reduced by 1100 million, but it is a one year shot. With the transfer of interest income from senior citizens or self-employed persons to the federal Governement, when the interest rate is said to be around 10 per cent to 15 per cent, depending on the way it is computed and on the frequency of the interest payments, the Government, according to our figures, stand to gain about $20 million from our senior citizens.
The Government tried to de-index old age pensions. Fortunately, that did not work. Now it is making up for that by forcing senior citizens, whose pension or interest income totals $18,000, $20,000, $21,000, to make their remittances on the 15th of the month. Mr. Speaker, this is so unacceptable that even the Conservative Members who sit on the Standing Committee on Finance and Economic Affairs decided to vote against it. I hope that, after thinking it over, all Members of the House will see that the members of the committee were right the first time and that this motion moved by my colleague from Saint-Leonard-Anjou (M. Gagliano) should be voted on and agreed to very quickly by the House.


Victor Fredrich (Vic) Althouse: Mr. Speaker, I will be very brief. I think this is one of the silliest and pettiest aspects of the tax reform package the Government has put before the country. This is an absolutely outlandish kind of suggestion. What the Government is asking for is that all those
people who make their income tax payments on a quarterly basis, retired people, small businesses, contractors and some farmers, a whole host of people who pay their taxes on a quarterly basis, will have to change their bookkeeping practices so they can make their cheques out 15 days sooner.
Why is the Government asking that all this disruption take place? It is simply that in the year that it comes into effect, for that one quarter, the Government will have one more bit of money allocated to the previous fiscal year instead of to the next year. For that one year, when it comes into effect, the deficit will be that much smaller by the amount of that particular quarterly payment. That is a pretty silly and cynical reason for forcing people all across the country to change their bookkeeping and accounting practices. I think the fact this may turn out to come into effect during an election year makes people even more cynical and quizzical about the utilization of this particular tax reform package. This is silly and petty and has no place in a genuine tax reform package.


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


Some Hon. Members:: Yes.


Mr. Deputy Speaker:: The question is on Motion No. 17. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


Some Hon. Members:: On division.


Mr. Deputy Speaker:: I declare the motion negatived on division.
Motion negatived on division.


Mr. Deputy Speaker:: The House will now proceed to the taking of the deferred division at the report stage of the Bill now before the House.
Call in the Members.
And the division bells having rung:


Mr. Deputy Speaker:: The first vote is on Motion No. 1.


Raymond Garneau: That Bill C-139 be amended in Clause 6
(a)	by striking out line 37 at page 11 and substituting the following
therefor:
"a taxpayer in excess of $20,000 (plus the provincial retail sales tax, if
any)or such"
(b)	by striking out line 41 at page 15 and substituting the following
therefor:
August 25, 1988

"passenger vehicle exceeds $20,000 (plus the provincial retail sales tax, if any) or"
(c)	by striking out line 45 at page 15 and substituting the following therefor:
"$20,000 (plus the provincial retail sales tax, if any) or that other prescribed"
(d)	by striking out line 9 at page 16 and substituting the following therefor:
"(iii) $20,000 (plus the provincial retail sales tax, if any) or such other amount as".
Motion No.l was negatived on the following division.
(Division No. 563)
++YEAS
Members
Allmand	Foster	MitchellAlthousc	Gagliano	NicholsonAngus	Garneau	(Trinity)Benjamin	Gray	Prud'hommcBoudria	(Windsor West)	RobinsonCassidy	Kaplan	Waddell-20Epp	Keeper	(Thunder Bay -	Killens	Nipigon)	MacLcllan
NAYS Members	Andre	Grisc	Piet zAttcwcll	Guilbault	PorterBclshcr	(Drummond)	ReidBertrand	Hicks	RcimcrBlackburn	Hnalyshyn	Ricard(Jonquicrc)	Hockin	St. GermainBlais	Horner	ScowcnCaldwell	Joncas	ShieldsChampagne	Jourdcnais	Taylor(Champlain)	Landry	TremblayCossitt	Leblanc	(Quebec-Est)Crouse	Lewis	TupperDarling	Lopez	Van Dc WalleDaubncy	Mailly	WhiteDick	Malone	Witcr-51Edwards	Martin	Fcrland	Mazankowski	Fralcigh	Minakcr	Frctz	Mitges	Graham	Obcrle


Mr. Deputy Speaker:: I declare the motion lost.


Mr. Deputy Speaker:: The next question is on Motion No. 2. Mr. Garneau moved:
Motion No. 2
That Bill C-l 39 be amended in Clause 20
(a)	by striking out line 33 at page 70 and substituting the following therefor:
"any property is 2/3 of his capital gain"
(b)	by striking out line 38 at page 70 and substituting the following therefor:
Income Tax Act and Related Acts
"of any property is 2/3 of his capital loss"
(c)	by striking out line 43 at page 70 and substituting the following therefor:
"the disposition of any property is 2/3 of'
(d)	by striking out lines 2 to 46 at page 71 and lines 1 to 6 at page 72 and substituting the following therefor:
"years and fiscal periods ending after 1987."
(Division No. 564)
++YEAS
Members
Allmand	Gray	NicholsonBoudria	(Windsor West)	(Trinity)Foster	Kaplan	Prud'homme-Gagliano	Killens	Garneau	MacLcllan	NAYS	Members	Allhouse	Fcrland	MitchellAndre	Fralcigh	MitgesAngus	Frctz	OberleAttcwell	Graham	PictzBclshcr	Grise	PorterBenjamin	Guilbault	ReidBertrand	(Drummond)	RcimerBlackburn	Hicks	Ricard(Jonquicrc)	Hnatyshyn	RobinsonBlais	Hockin	St. GermainCaldwell	Horner	ScowenCassidy	Joncas	ShieldsChampagne	Jourdcnais	Taylor(Champlain)	Keeper	TremblayCossitt	Landry	(Quebcc-Est)Crouse	Leblanc	TupperDarling	Lewis	Van Dc WalleDaubncy	Lopez	WaddellDick	Mailly	WhiteEdwards	Malone	Witcr-60Epp	Martin	(Thunder Bay-	Mazankowski	Nipigon)	Minaker


Mr. Deputy Speaker:: I declare the motion lost.


Don Boudria: Mr. Speaker, 1 think that if you would seek unanimous consent of the House, you would find that the House would be favourably disposed to apply the results of the vote on Motion No. 1 to the vote on Motion No. 6 and the same results in reverse to the concurrence motion.


Mr. Deputy Speaker:: Is there unanimous consent to apply the vote we have just taken on Motion No. 1 to Motion No. 6?


Some Hon. Members:: Agreed.


Donald Frank Mazankowski: that Bill C-	139, as amended	, be concurred in.


Mr. Deputy Speaker:: Is it also agreed that the vote we have just taken will be applied in reverse to the motion for concurrence in the Bill at report stage?


Some Hon. Members:: Agreed.


Mr. Deputy Speaker:: I therefore declare the motion agreed to.


Douglas Grinslade Lewis: Mr. Speaker, I think you would find that there is a disposition in the House to call it ten o'clock.


Mr. Deputy Speaker:: It being ten o'clock, this House stands adjourned until ten o'clock tomorrow morning.


[Stage Direction]
The House adjourned at 9.12 p.m.
[Stage Direction]

Friday, August 26, 1988

a comprehensive response to this report.
The report, Nuclear Energy: Unmasking the Mystery, concludes that nuclear power is a vital element of Canada's Prayers	future energy system.