1988-02-26

[Stage Direction]
The House resumed from Thursday, February 25, consideration of the motion of Mr. Wilson (Etobicoke Centre):
That this House approves in general the budgetary policy of the Government.
Mr. Howard McCurdy (Windsor-Walkerville):: Mr. Speaker, there are some who have suggested that, given the lack of any really significant initiatives in the Budget introduced recently by the Minister of Finance (Mr. Wilson), it was introduced simply because a promise was made that a Budget would be provided during each February; because it had to be done it was done and therefore it did not contain very much.
There are also those who say that in terms of the usual pattern of election Budgets this one was a missed opportunity for the Government. It was in fact a missed opportunity. It was a missed opportunity to be fair. It was a missed opportunity to provide for the future. It was a missed opportunity to be fair because, as all Canadians know, we have a tax system that still lacks fairness. We have a tax system that still has large elements of regressiveness in it. We have a tax system in which the rich seem bound not to have to pay as much as the very poor. We have a tax system in which many corporations go from year to year without paying any tax.
We find that this year, one more time, that the loss in tariffs as a result of a free trade agreement will amount to some $300 million. We have as a consequence, one might infer, the introduction of a tax on gasoline of an additional 1 cent per litre that will cost the average family around $300 additional per year. Once again, it is the little guy who will pay the biggest share of a new tax for a purpose that the average elector has not had an opportunity to approve.
I would note that down our way Canadians often go to Detroit to buy gasoline. When one takes into account the level of taxation on both sides of the border it is true that the tax rate on Canadian gasoline is much higher than it is in the
United States, even though we ought to have an advantage in that area of cost of energy. It is also true that, even if one takes into account the differences in taxation, the price of gasoline is still higher in Canada as compared to the United States.
If one considers the much vaunted tax reform that the Government has introduced, one finds that in spite of all, the average Canadian family of four is still paying $1,000 more than such a family did before the Government came to power. Of course, apart from the element of fairness there is the element of dishonesty. We know that the Government has sales tax changes in mind which will increase the regressive elements in the system. What is more, the lower income and the middle income family will be hurt again.
Of course, you know, Mr. Speaker, that with respect to the element of fairness we have pointed out that there are a number of corporations, some 60,000 indeed, which have managed not to pay any tax at all. The Government has rejected our proposition that there should be a minimum tax on corporations. This is not a radical proposition. It is a proposition which was accepted by the socialist Reagan Government of the United States. It is something that certainly could be emulated here.
When we talk about unfairness, missed opportunity, and the lack of regard for the future, we have to take a look at what the Government has done in the area of regional development. It is true that the Government has articulated a notion that there ought to be a measure of independence and regional control over economic development as in the Atlantic Canada Opportunities Agency, in the Western Diversification Fund, and the initiatives in northern Ontario. When we take a close look at those initiatives, the element of local control is lacking.
More important, if one takes a look at what has been done in Atlantic Canada since the Government came to power, and one takes into account the increases provided in this Budget, it is only going to have returned to it 20 per cent of the funds that the federal Government was previously providing to Atlantic Canada in the way of regional transfers.
There are other elements in terms of future economic development that ought to be attended to. Two years ago the Federation of Municipalities of Canada proposed that some additional $12 billion be provided for the reconstruction of municipal infrastructure. This is a fundamental necessity throughout the country if we are to have the type of economic growth in the future that will provide the jobs that will make it possible for Canadians to prosper, and for us to perpetuate the

February 26, 1988
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system of social support and essentially civilized behaviour with respect to the treatment of our people that has grown to be a tradition in Canada.
When one looks at what the Government has been saying about its success in providing jobs, I think that most Canadians will realize that that success has left us all with but certain portions of Ontario without there being an equal and fair share in what job creation there has been.
Even when one talks about Ontario, and hears the Prime Minister (Mr. Mulroney) and various members of his Cabinet brag about how well things have gone in Ontario, usually they are referring to the golden horseshoe. When we talk about the need for reconstruction of municipal infrastucture and the need for such things as roads, sanitary sewers, and living up to our obligations on our international agreements with the United States with respect to cleaning up the Great Lakes, and one looks at the unemployment rate in Windsor which is at 14 per cent, we can see that even in Ontario there are areas where Government failures are quite evident.
When talking about missed opportunities with respect to the future, I would like to pay closer attention than perhaps others have done to some aspects of what I think are fundamental failures of the Government. I am fortunate to have youth, post-secondary education, and science and technology as my critic areas for the New Democratic Party.
It is interesting to note all the hoop-la propagated by the Government a couple of years ago during International Youth Year. The Government made huge undertakings to ensure that there would be increased opportunities, and increased opportunities for participation of youth. As Members know, we had a little game of musical chairs that occurred with respect to the youth Ministers, until we reached the point where we now have a youth Minister who pays little attention and says relatively little about youth. Meanwhile, those programs that are supposed to be directed toward youth seem to have lost their priority for the Government.
For example, in regard to the support for student employment under the Challenge programs, in actual funds and in real money allocated for the Challenge program, there has been a continuing drop since the Government came into power. In 1986 S210 million was provided for the summer Challenge program. It has now sunk to $180 million. Of course, with inflation there has been dramatically decreased funds for that purpose.
When one also considers the student loan programs for university students, one finds that we are in a situation where the funds available to be borrowed are inadequate. More important, the emphasis on loans has led to a situation where almost every university student finds himself or herself in the serious difficulty of a huge debt load. By the time of graduation, more than 50 per cent have to carry a debt load of some $10,000.
Yet apart from the organization of study committees, we did not see in the Budget any serious indication that the Government is prepared to engage in serious negotiation with the provinces to come up with a new commitment to support postsecondary education accessibility for our young people. We know that one of the most important elements of real economic growth, one of the real elements in future economic development and prosperity for this country is to ensure that there will be opportunity for all youth.
For the purpose of example, I focus on university and college students. But one can look at the whole scope of action by the Government in respect to increasing opportunity for our young people, and this means not only opportunity for young people but having within our population the capacity for highly qualified work and creativity to contribute to prosperity for the country. The Government has consistently seemed to be unable to address this issue with anything like the priority that it requires.
Let us look at the institutions that our young people are entering with the hope that they may become qualified for future jobs. Through the words of the Prime Minister, the Government promised to improve such opportunity. Through the words of the Prime Minister the Government promised to ensure that the universities and colleges would produce the skilled workforce that we require. If one looks at the pattern one finds that the Government has not only failed to bring about progress, there has been a positive deterioration in the state of affairs. In fact, that has been the case not only since the Government took office, but for the last 10 years.
One thing is sure, when one compares Canada to the other nations against which we must compete, there is among them a higher percentage of participation in post-secondary education, in training, and in apprenticeship than is the case in Canada. Yet we know that the Government has taken away some $2 billion from universities and colleges in the form of transfer payments to the provinces. Over the last decade there has been an increase of 24 per cent in enrollment in universities and colleges, but there has been an 18 per cent decrease in the level of funds.
Our universities and colleges are in a state of deterioration. This fact has been documented in a variety of ways, ways that indicate that the situation is one in which accessibility has been decreased, either by increases in tuition fees, by setting new admission standards which are more exclusive, in the form of libraries lacking adequate numbers of books, in laboratories that do not have adequate equipment, in the form of university professors and college teachers with overburdening loads, or in the form of some of our best scientists leaving because they cannot function in a situation where those institutions in which they work are not being adequately provided for. We missed an opportunity to be fair, not only to those who want to have a university or college education, but to contribute to the future economic growth of our country.
February 26, 1988

With respect to post-secondary education we know that post-secondary institutions have a role in addition to merely teaching. They have a role in research and development. To the credit of the Government, in a variety of ways it has articulated the necessity for real investment in research and development. We can recall that the Prime Minister has pointed out, as so many have pointed out, that unless Canada contributes a good deal more of its Gross National Product to research and development, we must fail in the competition with other industrialized countries of the world. We will fail to mobilize adequately the resources and opportunities which our country presents to us for achieving greatness, as we can.
The Prime Minister promised that we would increase the rate of investment in research and development from 1.3 per cent to 2.5 per cent. Something must have happened somewhere along the line in the attempt to become major league. If one looks at the over-all record of the Government since it has come into power, one sees that the real expenditures on research and development by the Government have actually decreased because of failures in a number of areas.
Just in January the Prime Minister promised that $1.3 billion in new money would be provided for research and development, with the intimation that that would go toward the improvement of basic research in our universities, by providing more money for centres of excellence and for a national scholarship program. The curious thing is that of that $1.3 billion, only about $300 million has been accounted for.
Meanwhile, the Prime Minister's own National Advisory Board on Science and Technology, in the form of the Lortie report, said that basic research was in such a sorry state that we needed to have an immediate investment of a half billion dollars over two years to increase the fundings of granting councils in universities. There was nothing about that in the Budget, not a word.
Here was an advisory council of prestigious membership, with great promise, indicating the focus for the Government, yet a simple recommendation of an assurance of an additional half billion dollars over two years for granting councils, and a subsequent 1.5 per cent rate of increase over GNP growth in those grants, was completely ignored in the Budget.
If one considers Canada's record in research and development, we are tenth among OECD countries and the seventh among the Group of Seven. We need strong initiatives with respect to not only industrial research but to basic research, and both however have been failing.
The Minister responsible for industrial technology has indicated that research initiatives must be subject to market forces. It is true that industrial research should so respond, but I would say parenthetically that even with regard to industrial research the Government has failed. With respect to R and D tax credits we have all kinds of complaints coming from industry about the failure of the Government to provide a
The Budget-Mr. McCurdy
means by which those credits could be returned promptly. As a consequence, many small industries, quite willing to go into research and development, are finding their cash flows affected because the Government has taken as long as two years to process them.
The Government has failed with respect to creating opportunities for youth. It has failed with respect to funding of universities. It has failed with respect to an adequate approach to research and development policy apart from high rhetoric.
In other words, if one looks at such initiatives as the space agency, which is embroiled in all kinds of confusion right now because the Government cannot make decisions with respect to its location, and even though it may be true that the Government has increased the amount of funding for the space program, one sees that it has not adequately dealt with the significant impact of the cost overruns already projected for the space program on our over-all space initiative. The Government is gaining in the race in space, but it is falling far behind in its pace on the ground.
Let me just pause for 30 seconds to say the following about the Government's research and development policy. We are hooked into major initiatives on the part of Europe and the U.S.A. There is no doubt that there can be a significant technological pay-off by involving ourselves in the space enterprise, but recently we have been presented with a real opportunity for a major mission in science that would put Canada number one and would enable us to gain technological pay-offs like nothing else imaginable.
Why does the Government not lead the nation in the direction of our own national mission which would be unique around the world, and consider our capabilities and potential for building leadership in science and technology through the exploitation of hydrogen technology?
I am sorry that I cannot continue to speak about this matter, but I would ask the Government to examine more seriously a new mission, a unique mission, a mission different from that of any other country in the world which would provide for Canadian prosperity and development in the future.
Mir. Redway: Mr. Speaker, I have never heard so much bull in all my life.


Ms. Mitchell:: Is that parliamentary language?


Mr. Redway:: I think his comments could be characterized, I might say, as full of bull. I could spend 20 minutes dealing with each and every point the Hon. Member has raised, but unfortunately Your Honour will not give me that amount of time, so I would just like to comment on a number of them.
The first thing I can recall is that the Hon. Member referred to a great number of corporations that were not paying any taxes. In fact, as the Hon. Member knows, of the 60,000 corporations which he and his Party talk about as not paying any taxes, about 3,500 of them are large corporations. Of those 3,500, most if not all of them are not paying taxes because of

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losses in previous years and, under the tax laws, they have the right to recoup those losses before they start paying taxes. Many of those corporations are in the Hon. Member's riding. The balance of those corporations are small and medium sized ones.
Is the Hon. Member really saying that he wants small and medium sized corporations to be wiped out, to go into bankruptcy, to lay off all their workers, just so the Hon. Member can say that everybody is paying taxes whether or not they have the money to do it?
Second, he talked about the Federation of Canadian Municipalities. He said that a couple of years ago it presented a plan for the federal Government to pay a lot of money to help the Federation in paying for infrastructure in those cities. 1 have corresponded and have had discussions with the Federation in that regard, and it had to admit that the economic study it did at that time did not stand up to analysis. The Federation promised that it was doing another economic study with which it would come back to me to justify its claims. That was two or so years ago, and I have not heard from the Federation of Canadian Municipalities since. It has not produced that report or economic analysis to justify the claims it was making.
I see that you are giving me the "hup to", Mr. Speaker. I could go on and on forever. The Hon. Member said that the Government should be fair. I just say to him: "Be fair yourself in the comments you are making".


Howard Douglas McCurdy: Mr. Speaker, I am surprised to find my colleague becoming so agitated as to use language coming very close to unparliamentary. What he just said would grow a considerable crop itself.
With respect to the Federation of Canadian Municipalities and the precision of its estimates of the needs of municipalities, that may, indeed, be open to question. I will not challenge the Hon. Member's proposition that there was some inaccuracy in its projection. But there can be no denying the needs of the cities of this country. I did not hear the Hon. Member deny that the municipalities of Canada are faced with considerable tax difficulties in getting the resources to do the jobs they are expected to do. I did not hear him deny that the burden has been made more difficult by the policies of the Government in ensuring that municipalities have the funds available to them and on the basis of federal initiatives that would allow them to do the jobs they are expected to do.
More seriously, I did not hear the Hon. Member suggest that some poor devil who was unemployed, who might have been unemployed for four or five years, should have been forgiven his taxes for the next five years. I did not hear the Member address the most significant elements of what I had to say in this Chamber. The Government has not come to grips with the future. The Government has failed to have a research and development policy that will have the impact it ought to
have on science and technology, with the creation of jobs all over the nation.
Nor did I hear the Hon. Member object to my assertion that the Government has failed to provide adequate funds to the regions so the regions could have the opportunity to undertake initiatives to create jobs so they would have as fair a part of the economy of Canada as Ontario has had.
The Hon. Member had all kinds of objections to what I said, but he did not object to the very fundamental of what 1 had to say, namely, that the Government has failed in this Budget to meets its responsibilities for taking initiatives to gain more prosperity for the nation.


Mr. Allmand:: Mr. Speaker, the Hon. Member will remember that approximately two years ago the Government cut the Katimavik program for Canadians, a program aimed at providing a national service for youth in Canada, also providing an opportunity for those young people who had a hard time adjusting to the labour market who needed some new type of supervised experience to adjust to the labour market. The Government has not replaced Katimavik with anything, although the Government said it would have some new kind of program of that nature.
The Hon. Member is the youth critic for his Party. Could he tell us if he has observed whether there is still a need in this country for some kind of national service program for youth and/or a program to help youth with difficulties adjusting to the labour market? From my observation such a program is still necessary. The Hon. Member comes from a different part of the country and dealing with a different group of people. I would like to know about his experience and the need for such a program which was cut by the Government two years ago.


Howard Douglas McCurdy: Mr. Speaker, it is interesting that in the course of my speech I came to realize that there were so many things which the Government has failed to do I found myself having to talk extremely fast to get in all its failures in 20 minutes. I did not have an opportunity, it is true, to mention Katimavik, but Katimavik is only part of the problem.
As I alluded to, a couple of years ago during the International Youth Year the Government promised that it would develop a policy for youth. The New Democratic Party proposed a coherent policy for youth. The Senate made suggestions about an over-all policy for youth and the Government promised that it would develop a policy for youth. Indeed, the Prime Minister stood in the House and said in March 1986 that we would have a program for youth. It was postponed to May. It was postponed to September. It was postponed to October. The Government appointed a new Minister of State for Youth, and the Minister of State for Youth (Mr. Charest) got lost somewhere along the line. He told me only recently that we will have a program for youth but it will not be until the election and it will be in the form of another promise.
February 26, 1988

We have proposed a coherent program that would provide youths all across this country with opportunities of the sort that Katimavik provided, that would provide opportunities for apprenticeship for training, for opportunities to go to colleges or universities as a person chooses and be supported in the form of an allowance to do so. I have heard rumours that the Minister of State for Youth thought that would be an attractive proposition. Somewhere along the line, I guess being diverted in a premature election campaign tour, he forgot about that. As a consequence, with the abolition of Katimavik and in spite of the promises of the Government, there has been no youth policy proposed or advocated by the Government since the International Youth Year. That is a great tragedy, Mr. Speaker.


Mr. Daubney:: Mr. Speaker, would the Hon. Member elaborate on some of the comments he made about science and technology and, in particular, the space program? He and 1 were both founding members of the Standing Committee on Research, Science and Technology. I have considerable respect for his genuine commitment to improving things in this area.
I want to ask the Hon. Member about the space agency which, as he knows, is a matter of interest to me as a Member from the National Capital Region. Would he agree that Montreal is not alone in having an important aspect of the space industry in Canada and that the space industry is truly a national one with facilities here in Ottawa, Toronto, other places in southern Ontario, Vancouver, Saskatoon and right across the country? It would be regrettable to locate the headquarters of the space agency in any one of the regions; the neutral territory here in the National Capital would be the obvious place to locate it. I say that not just for those reasons-no favouritism to any particular regions-but because we have here, and have had since the 1950s, the administrative and technical apparatus in the National Research Council in the Department of Communications and in other federal Departments and agencies.
In commenting on that, would the Hon. Member comment on the position of the Leader of his Party which, as I understand it, at least as announced in the Montreal area, is that the head office of the space agency should be in Montreal.


Howard Douglas McCurdy: Mr. Speaker, I think Ottawa has managed to take care of itself reasonably well. One of the difficulties is that the debate on the issue of the location of the space agency has diverted us from the real essential of the problem, and that is to get the operation in train. If something is contemplated, the Hon. Member is in a good position to do it. He is, after all, on the Government side and ought to be able effectively to make representations to the Cabinet to make whatever decision it is going to make immediately. As the Government fiddles, the scientists involved in the space program are burning with frustration.
I have worked with my colleague on the science research and development committee. He is a Member of Parliament I respect and whom I know is very much concerned about
The Budget-Mr. Boudria
science policy. Has he not given any thought to the relative merit of the space program in its entirety as an appropriate initiative with the emphasis the Government is giving it as compared to the alternatives?
The space research program inevitably ties Canada into initiatives established in the United States or Europe as kind of appendages. Would it not be better if Canada pursued the possibility of being able to establish its own unique mission, one for which it has comparative advantage in terms of its resources and opportunities? Why not advocate that the mission for Canada be perhaps in some other area such as the hydrogen technology area?


Margaret Anne Mitchell: What about Yellowknife?


Howard Douglas McCurdy: Yes.


Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, I am pleased to participate in this debate this morning. As you may recall, I had an opportunity to speak on the subamendment a few days ago, and I am sure Members across the way will remember it well. But now that we are speaking about the Budget I thought I would just refresh the memories of some Conservative Members about the failures of the Government. I know the Hon. Member for Windsor- Walkerville (Mr. McCurdy) tried to point out a number of those failures. I congratulate him on his valiant effort. However, he had only 20 minutes and it was indeed an enormous task to accomplish in such a short period of time.
During the 1984 election the Tories made promises to many people, as I think I have pointed out in this House once or twice before. One of the promises they made is in the document known as the "PC Pocket Politics". It was that a PC Government is committed to doubling our R and D efforts to 2.5 per cent of GNP in the first four years in office. Since they have been in power they have cut everywhere in the field of research and development. Scientists in the national capital area living in the constituency of the Hon. Member for Ottawa-Carleton (Mr. Turner) sitting across the way, know that the Minister of Finance (Mr. Wilson) and the Prime Minister (Mr. Mulroney) failed on that promise. They know how badly the Prime Minister failed to deliver. The people of Ottawa-Carleton will no doubt agree with me that the Prime Minister has failed to live up to the promises he made to Canadians.
I want to talk to you a bit about tax increases. You will remember that those Tories across the way made promises in that area as well. You will have a particular appreciation for that because of the fact that you are a non-partisan person and you can appreciate those kind of things in a far more objective way than the Tories sitting across the way, Mr. Speaker.
The Minister of Finance, when he was in opposition, said in a City TV interview on August 28, 1984-very important date because it is my wedding anniversary-that they had no

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The Budget-Mr. Boudria
intention of raising income taxes for Canadians. He said that what we have do is to get down government spending and so on. He said he did not want to increase taxes, that we have a good deal of scope on the expenditure side to deal with the deficit problem. A tax increase, certainly a general tax increase, puts a dampening effect on the economy and he did not want to see us do that.
It was the Minister of Finance who said that. What has he done? Let me tell you the sad reality of the tax increases by the Government. A single earner family of four making $32,000 a year has had a total tax increase since those Tories have been in power of some $1,200 a year. Would you believe it? This from a Minister who promised he would not increase taxes.
If it were an even distribution of increased taxes it would still be a breach of a solemn commitment, a sacred trust, as the Prime Minister referred to it in the past, but at least there would be some equity because everyone would be paying their fair share. Not so. Since 1984 taxes for average Canadians have increased some 68 per cent, while corporate taxes increased by 28 per cent. The friends of the Conservatives, the big business people, have not. had major tax increases, but average Canadians like your constituents and mine have.
Those are not the only promises broken by the Conservative Government. Let me enumerate another and you will no doubt remember it. You probably recall that the Conservatives had a meeting in Halifax, Nova Scotia-you may have read about it in the paper-on August 2, 1984. They called it the Atlantic caucus meeting. Of course, most of the people at the meeting were not caucus Members at all, but that did not matter. At the meeting the Prime Minister proclaimed that he would examine gasoline, alcohol, food and lodging taxes which are reducing the competitiveness of Canada's tourism industry. In other words, clearly indicating to Canadians that what he wanted was lower gasoline prices.

What happened to make the Prime Minister change his mind? Since the Conservatives came to power, the excise tax on gas has increased by 23 cents a gallon. Twenty-three cents! Isn't that outrageous? Mr. Speaker, it's almost enough to make the Hon. Member for Argenteuil-Papineau (Mrs. Bourgault) want to resign. I am sure she must have trouble justifying this kind of behaviour on the part of the Government, considering the solemn commitments made by the Leader of the Conservative Party. Mr. Speaker, this is one more promise, one more solemn commitment that was broken by the Prime Minister. And there are more.

I invite the Member across the way to pay attention. We will ask him questions later.
The Government said with respect to agriculture that it would allow the Farm Credit Corporation to offer agri-bonds so that farmers would have access to reasonably priced funds.
That was the promise. You would think that at least that promise would have been kept. No, once again the spending estimates of the Government came out on February 23, only a few days ago, and do you know how much money the federal Government has placed in the Estimates for the FCC this year? Zero, a grand total of nothing. Nothing for the farmers from the Government. This is not the first time that the farming community is disappointed with the Tories. It is almost a tradition, a tradition that is soon to end, of course, after the next election.
The economic and regional development envelope of the Government in its budgetary estimates has gone down from $14.8 billion to $13.3. What does that do for agricultural development?

And I want to ask the Hon. Member opposite what the cutbacks in the regional economic development envelope are supposed to do for agricultural development?

However, it is nice to know that the Government had money for other causes. Yes, we know that the office of Dalton Camp, which cost zero two years ago, cost $230,000 last year and is budgeted at $261,000 in this year's Estimates. The job of Mr. Camp is to keep the Government out of trouble. He was hired specifically to do that. You can tell what a great job he has done. He has certainly kept the Government in trouble. Just imagine what it would have been like had he not been there? It would have been a disaster. Of course, it is already a disaster.
I could go on with highlighting some of the horror stories of contradictions between the Government's promises and the record. For instance, let me remind you of a promise that the Right Hon. Secretary of State for External Affairs (Mr. Clark) made on September 26, 1984. That was only a few days after he was sworn into office-still a little green. He told the UN that his Government would fulfil a previous Liberal target of directing .7 per cent of Canada's GNP by 1990 to official development assistance. Obviously that is not going to be met. Again, the Government breached a promise. As a matter of fact, the Conservative Government has now pushed that target back by five years according to the November 8, 1984, economic statement.
It has not gotten any better since then. In May of 1985 the Conservative Government cut back further on development assistance. It says it remains committed to the target of .6 per cent of GNP by 1990. Remember that the previous Government had committed .7 per cent. Official development assistance was reduced by $50 million in the following year.
The Budget speech of February 26, 1986, said:
-growth in Canada's aid program will be reduced by $1.5 billion over the
next five years. For the balance of this decade foreign aid will remain at 0.5
per cent of GNP.
February 26, 1988

You can see that the Government is not only weaseling out of previously made commitments but is reducing and changing a solemn promise made to the people of Canada.
The people of my constituency are beginning to be quite upset with the Tories. It is small wonder that the Tories cannot find a candidate to run there.


Mr. Turner (Ottawa Carleton):: They want me.


Don Boudria: I just heard good news, Mr. Speaker. They want the Member for Ottawa Carleton to run in Glengarry- Prescott-Russell for the Conservatives. That would be great. The last Conservative candidate in my constituency had the honour of being defeated by the Liberal with the largest majority in Canada. I invite the Member to try to match the record of his predecessor in the riding of Glengarry-Prescott-Russell.
Let me remind you of more broken promises, Mr. Speaker, just to further convince the Government that it is going in the wrong direction, which should be obvious already if it listens to what Canadians are saying. Shipbuilding is a very interesting area and I invite the NDP to pay attention to this as well because we know that their policy is a little confused on that issue. A communique issued at the August 2, 1984, Atlantic caucus said:
A top priority of a PC government will be to create a more viable and prosperous shipbuilding industry. In achieving this goal, we will consult with provincial governments, maritime industries and labour. We will submit the following proposals to these groups during the consultative process.
A second component of their program was "extension of support for Atlantic ship repair facilities and dockyards". We have now seen that the second stage of our frigate program has been delayed. Part of the program has been abandoned. The Government has done everything but deliver on its promises. On February 16, 1986, the Minister of Finance said in this House in his Budget speech:
We are eliminating programs such as... the Shipbuilding Industry Assistance Program.
That was said by the same guy who said he wanted to assist shipbuilding. Under that program which was instituted by the previous Liberal Government and terminated by the Tories shipyards could get a 9 per cent subsidy. Many shipbuilding facilities and organizations including the Canadian Shipbuilding and Ship Repairing Association asked for an extension of that program. However, notwithstanding the solemn promises that the Conservatives made to the shipbuilding industry and the people of Canada, they completely ignored those very important suggestions from the shipbuilding industry and again breached a solemn promise they had made.

Mr. Speaker, I said recently in the House that the Economic Development Committee of the United Counties of Prescott- Russell, and I am referring to the Committee on Industry, Tourism, Agriculture and Commerce, issued a press release. In fact, the Committee chairman, Mr. Denis Pommainville, an
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elected official in my riding and the Reeve of Cambridge Township, issued a communique condemning the Budget brought down on February 10 by the Conservative Government.
I am glad to hear the Hon. Member opposite say this man must be a Liberal! Shame, accusing an elected official in such a partisan manner. But I am glad to hear it, and 1 want this to be read into the official record of Hansard. I will let Mr. Pommainville know about it, and I am sure the Hon. Member for Ottawa-Carleton (Mr. Turner) can subtract one more vote from the few he might have had if he had run in the riding of Glengarry-Prescott-Russell. His colleague just lost him another vote.
The press release starts with the Committee chairman regretting that the initial economic impact of the Trade Agreement, the so-called Free Trade Agreement with the United States, was mainly negative on rural regions like the one he represents.
In fact the one cent per litre increase in the tax on gas is a tremendous setback for sparsely populated regions, especially those without public transit. Once again, the 12.5 per cent who are unemployed in the area-more than twice the average rate for Ontario-will be handicapped in seeking retraining and opportunities to go back to work, now that owning a car is becoming increasingly expensive.
Mr. Speaker, as you see, this is one elected representative in my riding at the municipal and regional level who is thoroughly disappointed in the Budget brought down by the Minister of Finance (Mr. Wilson) here in the House a few days ago.
Mr. Speaker, I would like to take the few minutes I have left, and unfortunately they are very few, to talk about the tax on long distance calls. This tax is an affront to people who live in rural areas. Canadians living in these areas often have to call long distance to call the doctor, stores, and even people who live only a few streets or concessions away. This measure is unfair to these communities because although the basic charge is not expensive, long distance calls are. I think putting a 10 per cent tax on freedom of speech is unfair to all Canadians, but it is particularly unfair to Canadians in rural communities and to people who own businesses.

All in all, Mr. Speaker, this is a bad Budget. There was not much to the Budget, it was not a very big document, however, it is not good for the constituency which I represent. I invite the government Members to think about whether or not this Budget is good for their riding. They should conclude, as have I, that it is bad, and they should assist us in defeating the Budget and, while we are at it, in defeating the Government too.


Mr. Deputy Speaker:: It being eleven o'clock, pursuant to Standing Order 19(4) the House will now proceed to Statements by Members pursuant to Standing Order 21.

February 26, 1988



STATEMENTS PURSUANT TO S. O. 21


Mr. Sergio Marchi (York West):: Mr. Speaker, many Canadians find the recent actions of the Secretary of State for External Affairs (Mr. Clark) threatening to boycott the activities of three Canadian Sikh organizations highly questionable. By conducting a letter-writing campaign against these organizations, some of which were sent to certain Premiers and not others, and some to some federal politicians and not others, it seems that the Minister is reticent in disclosing all he knows to all elected representatives. He should justify the reasons for his recommendations and clarify the allegations against the Canadian citizens within these three organizations by tabling all pertinent correspondence in the House.
It is truly unfortunate, Mr. Speaker, that the Secretary of State for External Affairs has tarnished the reputation of Canadians of Sikh origin. The Minister has painted the community with one brush and has opted for collective guilt, instead of pursuing matters of individual responsibility in a sensitive and judicious manner.
Canadian history is littered with examples of communities and collectivities suffering for individual causes. One would have thought, Mr. Speaker, that we would have learned from past injustices.



CANADIAN NATIONAL RAILWAYS


Mr. Bill Blaikie (Winnipeg-Birds Hill):: Mr. Speaker, I rise to call the attention of the House to the fact that the Conservative Government has broken its promises to Winnipeg with respect to maintaining Winnipeg as a transportation centre in western Canada. As was revealed yesterday, it is allowing CNR to downsize the prairie region in Winnipeg to an extent where it will soon become a farce to talk about CN maintaining its prairie region in Winnipeg.
Rather than railroaders, a bunch of maniacal downsizing accountants are running the railway. We will soon pay through the nose for the cost in morale, safety, and other problems that will accumulate as a result of the very bad management decisions that are being made. Tory Members of Parliament from Manitoba have once again failed to protect the interests of Winnipeg. They turned a blind eye, and are sleeping at the switch while allowing the CNR to gut its prairie region headquarters in Winnipeg.



ABORTION


Mr. Felix Holtmann (Selkirk-Interlake):: Mr. Speaker, the recent Supreme Court ruling overturning Section 251 of the Criminal Code has left millions of Canadians saddened and confused.
The Supreme Court was not elected to govern Canada. Its role is simply to interpret the legislation enacted by this Parliament.
I, as have all Members of the House, have been contacted by thousands of constituents regarding the Supreme Court decision. These constituents are telling me one thing. They are asking-in fact pleading-that our Government take speedy action to enact new legislation.
Much time has been wasted in the House dealing with the Opposition's wild goose chases trying to slander other Members of the House. This waste of time is shameful when Canadians know that the issue of abortion is critical and crucial to the future of our nation.
On behalf of my constituents, I urge the Government to enact legislation quickly that will protect the lives of all Canadians, both those born and those yet to be born.



UNEMPLOYMENT INSURANCE


Mrs. Mary Collins (Capilano):: Mr. Speaker, a recent CBC TV story outlined the plight of a Vancouver couple whose child was born prematurely and remained in hospital for several months, but because of the limitations of the unemployment insurance regulations the mother was not allowed to postpone taking her maternity leave until the infant was released from hospital and went home, a time when the mother really needed the leave to care for her child.
This is not an isolated case. I have had similar cases brought to my attention and have urged the Minister to make the necessary changes in the unemployment insurance regulations.
Advances in technology and health care mean that many premature infants, who years ago would not have survived, are now able to do so with dedicated assistance from hospital personnel during their first critical weeks. Even after they go home to their parents' care, there are often special medical needs which make it more critical to have a parent with the infant on a continuous basis.
I ask the Minister, knowing his compassionate and caring nature, to move on this matter so that families facing these traumatic situations will have the security of knowing that
February 26, 1988

maternity benefits are available at the time they are most [English]
urgently needed.	POLITICAL PARTIES



CONFLICT OF INTEREST ACT-POSITION OF OPPOSITION PARTIES   LABOUR RELATIONS LE DROIT NEWSPAPER-REQUEST THAT PARTIES RETURN TO NEGOTIATING TABLE

M. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, since February 20, Francophones in the National Capital Region have been deprived of an essential information tool in their own language.
I am referring to the strike which is dragging on at the newspaper Le Droit, involving some 200 shop workers and newspapermen and affecting over 45 000 readers.
Le Droit has always been a privileged advocate of Franco-Ontarians and this role must continue. A French language daily is a privileged source of information we cannot afford to lose.
This is why I am requesting all Hon. Members in this House to join me in asking both parties to go back to the bargaining table and to find a satisfactory solution to this unfortunate dispute which has already lasted too long.
I ask both Parties, not only in my name, but in the name of my colleagues, to go back to the bargaining table and to come up with a good solution.



PUBLIC SERVICE


Mr. Mike Cassidy (Ottawa-Centre):: Mr. Speaker, the position of the Government regarding its language teachers is totally out of line with its support in principle for bilingualism, as expressed in Bill C-72, now undergoing second reading in the House of Commons. Last December, some 800 language teachers strongly rejected the proposed collective agreement which would have increased their teaching workload from 20 hours per week to a maximum of 37 and a half hours, without any preparation time.
If we want that public service employees, some of which are performing very complex and specialized tasks, be bilingual, we have to provide them with apt and professional language training. I therefore urge the Government to put an end to these lockouts and to its refusal to negotiate, and to go back to the negotiating table with a view to achieve a just and acceptable collective agreement, which would allow the language teachers to work as professionals rather than slaves.


Mr. Dave Nickerson (Western Arctic):: Mr. Speaker, it has been reported that the reception by the opposition Parties of the conflict of interest Bill has been lukewarm.
This is not surprising. If the truth were to be known, they are probably shaking in their boots.
Just how ordinary are the ordinary Canadians in the New Democratic Party? Is it only the Member for Oshawa (Mr. Broadbent) who travels around in a chauffeur-driven limousine?
Who pays for the Liberal Leader's (Mr. Turner) $3,000 a month Toronto apartment? What is the connection between Liberal Members and the generic drug firms? Was their opposition to Bill C-22 purely altruistic?
Yes, Mr. Speaker, conflict of interest applies to both sides of the House. No wonder they are lukewarm, or maybe even chilled to the spine.



HUMAN RIGHTS


Mr. W. R. Bud Jardine (Northumberland-Miramichi):: Mr. Speaker, two weeks ago a team of United States doctors stated in a story in the Ottawa Citizen that Israeli soldiers were systematically beating Palestinians in an epidemic of violence.
Dr. Geiger of the Boston based Physicians for Human Rights stated that they collected medical evidence of violence by the Israeli army on a scale and severity that, if this were a war, much of what they had seen would be regarded as atrocities.
Dr. Jennifer Leaning of Harvard said the doctors observed a systematic pattern of breaking limbs by beatings that is designed to fall short of killing victims.
Sadly, we too witnessed that kind of torture, of beatings, of gross violation of human rights this morning on Canada AM, captured on film, soldiers with rocks breaking the limbs of bound Palestinian refugees.
Again, I ask, I plead, for the Government to show the same leadership against human rights violations in Palestine as it has shown and demonstrated in South Africa.

February 26, 1988



SPACE AGENCY


Mr. Marcel Prud'homme (Saint-Denis):: Mr. Speaker, I was recently telling this House that the best speech is a short speech. Therefore, I am asking again: When will this government be courageous enough to declare that Montreal is "spatial"? We have been waiting for months for the government to make that very important statement. Hundreds of thousands of dollars have been spent to make the government aware of how important it is to declare that Montreal is "spatial" and we are still awaiting that decision. What must be done, 1 ask you, Mr. Speaker, for the government to make up its mind at last to declare that Montreal is "spatial"?



NATIVE PEOPLES


Mr. Rod Murphy (Churchill):: Mr. Speaker, the people of northeast Manitoba are in need of an electrical line power. The federal Government can help them to obtain this power.
While the Minister of Indian Affairs and Northern Development (Mr. McKnight) has agreed in principle to study this matter, it is essential that a further commitment be made. It is important that the Government undertake to sign a memorandum of understanding committing itself to the development of this hydro line, and to do so in a manner that would involve meaningful native participation.
A hydro line is essential to the livelihoods of over 8,000 native people in my riding. The people of Oxford House, God's Narrows, God's River, Wasagamack, St. Theresa Point, Garden Hill and Red Sucker Lake have all done without a service that most Canadians take for granted. Their struggle to get adequate electrical services has gone on for decades.
Without this electrical line the quality of life in these communities is seriously damaged, and significant industrial development of any kind is next to impossible. We have the opportunity to make a truly significant contribution to the livelihoods of the people of this region. It is up to the federal Government to meet that opportunity.



NEW DEMOCRATIC PARTY


Mr. Gabriel Fontaine (Levis):: Mr. Speaker, on February 24, I mentioned in this House that political organizers of the socialist party used and encouraged others to use, in a manner that is illegal and detrimental to Canadian taxpayers, the telephone code number given to the leader of the socialist party, the Hon. Member for Oshawa (Mr. Broadbent).
Mr. Speaker, that use of taxpayers' money to the socialist party's benefit seems to be institutionalized. Last February 22, the Hon. Member for Ottawa Centre (Mr. Cassidy) used his mailing privileges to send to people in his riding, following very precise mailing lists, a document entitled The New Democrats, Report from Ottawa. It contains the picture of the Hon. Member for Oshawa, another one of that party's general secretary, Bill Knight, and a family picture of the Hon. Member for Winnipeg. It contains as well partisan messages that are positive for the socialists but negative for the Conservatives.
Is that a legal use of the Members' mailing privileges? Indeed, Mr. Speaker, this party and, above all, its leader are not transparent at all.



STEEL EXPORTS TO UNITED STATES

Mr. Allan Pietz (Welland):: Mr. Speaker, as a representative of a steel-producing centre I would like to comment on the recent ruling in favour of the Canadian steel industry by the International Trade Commission in Washington. I hope that this ruling will help ease the concerns of the American steel caucus with respect to the bilateral free trade agreement. Our steel companies have stayed within the quotas imposed by the Americans, except when the U.S. has experienced a shortage and has turned to Canada for help.
This latest anti-dumping ruling in favour of Canada proves that our steel industry trades fairly. The Canadian Steel Producers Association has been very supportive of the free trade agreement.
With favourable rulings such as this, along with the efforts of the Canadian steel caucus, I have no doubt we will strengthen our current trade relationship under the Government's bilateral free trade agreement.
February 26, 1988



CULTURE


Don Boudria: Mr. Speaker, in June 1912, the Department of Education in Ontario introduced the infamous Regulation 17 prohibiting for all practical purposes French education in Ontario. Faced with such francophobia, French-speaking Ontarians took a number of steps to claim their right to French education. They founded the newspaper Le Droit which championed the cause of francophones. Over the years, the newspaper has grown to become one of the great dailies of this country. Unfortunately, the very existence of the newspaper is now threatened.
I call upon Mr. Gilbert Lacasse, the employees' union and especially Mr. Conrad Black, to find a reasonable and fair settlement to the labour conflict threatening our daily in the national capital. French-speaking Ontarians want to keep a true francophone newspaper in Ottawa and not an extension of a newspaper coming from elsewhere. The motto of Le Droit, that is "The future belongs to those who fight" is still valid.
We must fight together to preserve the only French daily in Ontario and as soon as the conflict is resolved, I will encourage francophones not only in Glengarry-Prescott-Russell, but on both sides of the Ottawa river, to subscribe to Le Droit and to ensure not only the survival of that newspaper but also its development.



ADMINISTRATION OF JUSTICE


David Bruce Daubney: Mr. Speaker, next Tuesday the Standing Committee on Justice and Solicitor General, which I have the honour to chair, will begin three days of public hearings and prison visits in British Columbia. These hearings are part of a major review of sentencing, conditional release, and related aspects of the correctional system which the committee has been engaged in since the fall.
In addition to our twice weekly meetings here in Ottawa the Justice Committee will be visiting all regions of Canada between now and the summer recess. After British Columbia we will spend a week in Toronto during the week of March 20.
1 urge all Canadians who are interested in improving the justice system to take an interest in the vital work of our committee.
Oral Questions VISIBLE MINORITIES



CHINESE HEAT TAX-POSITION OF PROGRESSIVE CONSERVATIVE PARTY

Alan Redway: Mr. Speaker, prior to the last election, on August 16, 1984, the Progressive Conservative Party of Canada sent a letter to the Chinese Canadian National Council which reads as follows:
The Progressive Conservative Party supports the introduction of an all-party Parliamentary resolution which would recognize the injustice and discrimination of the Head Tax and the Chinese Immigration (Exclusion) Act. Such a resolution would also recognize the suffering of the Chinese community in Canada that resulted from these actions.
The Progressive Conservative government would look forward to having discussions with representatives of the Chinese Canadian Community regarding appropriate remedial action and the specific matter of financial compensation.
The Chinese Canadian National Council is also looking forward to these discussions and to the all-Party parliamentary resolution.



ORAL QUESTION PERIOD


Hon. Lloyd Axworthy (Winnipeg-Fort Garry):: Mr. Speaker, I would like to address my question to the Deputy, acting, stand-in, substitute, Minister for Trade, whomever that may be this morning. The question I wish to pose to whomever wishes to answer it is an important one.
This morning we have heard reports that the Premier of Manitoba and the Premier of Ontario are now threatening to take the federal Government to court to defend the right of their provinces to implement laws in their own jurisdictions on matters regarding trade. At the same time we know that the U.S. administration and Congress are demanding compensation unless there is full compliance by the provinces. The Government of Canada has caught itself in the proverbial spot between a rock and a hard place.
I wish to ask this question of the Government. Is it not absolutely incumbent upon the Government of Canada to sit down and meet with the provincial Governments to discuss the constitutional federal-provincial problems that have been created by the proposed Canada-U.S. trade deal, and to resolve those problems before any implementing legislation is brought into the House?


Hon. Flora MacDonald (Minister of Communications):: Mr. Speaker, the Minister for International Trade will be in the House later. I would like to inform the Hon. Member in the meantime that no Government has discussed any one issue with the provinces more than this Government has discussed

February 26, 1988
Oral Questions
with the heads of provincial Governments the means to implement a free trade agreement with the United States.
As the House will know, the Prime Minister has attended meeting after meeting, hour after hour, to discuss the terms of the negotiation. We have an understanding, an opinion, that there is within the constitutional status of the federal Government the power to enact the legislation that we will be bringing before the House.
I can assure you, Mr. Speaker, that the discussions that the Prime Minister has initiated with the provinces in this field will be ongoing.


REQUEST FOR FEDERAL-PROVINCIAL MEETING
Lloyd Axworthy: Mr. Speaker, I see that the Minister for International Trade is now entering the House. I will address my supplementary question to her.
It may be true that there have been prior discussions but the problem has not been resolved. We now have provincial Governments going to court and the Parliament of Canada being expected to deal with legislation that, clearly, could be ultra vires the Constitution of Canada, which could be a major disruption in federal-provincial relations. I ask this question now of the Minister for International Trade.
Would it not be prudent and proper for the Government of Canada to sit down with its provincial counterparts to resolve this major disruption, this major confrontation that is brewing, because of the trade agreement, to determine if there is a way of resolving it? If there is not, they should then go back and reject the trade agreement because it runs counter to the Constitution of Canada.


Hon. Pat Carney (Minister for International Trade):: Mr. Speaker, as the Acting Prime Minister has said, the Prime Minister has told the House repeatedly that Canada, the federal Government, has the constitutional right to sign and to negotiate international treaties. As the Acting Prime Minister has said, we have consulted throughout with the provinces on the free trade agreement. There have been something in the order of 18 meetings of the committee of officials. There have been about a a dozen First Ministers' meetings on this issue. They have been fully consulted, and their views have been taken into account.
The Prime Minister has made it very clear that the legal and constitutional authority of Parliament is clear. Should anyone wish to invoke a challenge, then they are entirely free to do so. That is the way our system works.
[DOT] (M20)


REQUEST THAT GOVERNMENT POSTPONE INTRODUCTION OF LEGISLATION TO RATIFY AGREEMENT
Lloyd Axworthy: Mr. Speaker, my supplementary question is the following. The Minister for International Trade is undoubtedly aware that
there was a Privy Council ruling in the 1930s, the International Labour Organization case, which clearly stated while the federal Government may sign a treaty the provinces may not implement that treaty if it falls within their jurisdiction. There is clearly a point of dispute.
The Parliament of Canada is going to be asked to pass legislation that runs counter to the Constitution of Canada. I would suggest that it would be important for the Government either to resolve that dispute or to take a reference to the Supreme Court before it brings in any implementing legislation.
Will the Government delay bringing in any form of implementing legislation on trade until this major problem with the provinces is resolved, or is the Government once again giving in to the American threat of demanding compensation or concessions? Is that the real motivation for pushing ahead, even though significant provinces in this country are opposed to that particular move because it will take away their rightful powers?


Pat Carney: Mr. Speaker, in all that rhetoric it is a little difficult to understand what is the actual question. I believe it to be the same question that has been asked twice before. Therefore, there is the same answer.
The Government of Canada has the constitutional right to negotiate and sign international treaties. The law officers of the Crown have assured the Government that it is proceeding in a perfectly proper way. As reported in Hansard on February 10, 1988, the Prime Minister stated, "that we are acting not only within the purview of our legislative authority but very much in the national interest". The Prime Minister also indicated that anyone who wishes to challenge that is perfectly free to do so in the courts.


AGRICULTURE
Mr. Maurice Foster (Algoma):: Mr. Speaker, my question is directed to the Minister of Agriculture. I wonder if the Minister can confirm reports in the Kitchener-Waterloo Record in the last couple of days which indicate that his Department has received some 220 reports of contaminated meat from some 13 plants in the Kitchener, Waterloo, Guelph area between the period January, 1986, to October 31, 1987. Those reports indicated that meat was contaminated with manure, rust, dust, feathers, hair, and even paint. Many of the meat carcasses were described as slimy, having odours, and discolouration.
Can the Minister confirm that his Department has received reports like that for that period of time, and that even though
February 26, 1988

they were inter-plant shipments the meat could have been shipped across the country, delivered directly to stores, or even sold internationally?


Hon. John Wise (Minister of Agriculture):: Mr. Speaker, I have not had the opportunity to read the article. I was informed of the article and, immediately upon being informed of its contents, I requested the appropriate officials in my Department to investigate the situation.
I am sure that all Members of the House, and particularly the Hon. Member who posed the question, would recognize and probably substantiate the fact-and I would be very surprised if he did not-that Canada's meat and food inspection is among the finest in the world. It is supported by the Ontario Veterinary Association, it is supported by the Canadian Veterinary Association, and it is supported by the World Health Organization.
The Hon. Member should be very careful of the manner in which he puts that question, and the manner in which he puts that information. What one has to recognize here is the fact that it is as a result of the best food inspection system in the world that we pick out some of those problem areas and problem products in order that they do not get into the final link of the food chain.


MINISTER'S ACTIONS
Maurice Brydon Foster: Mr. Speaker, this information is in the public record. Canadians want to know what action the Minister is taking to ensure the safety and health of Canadian food. Surely the Minister does not have to wait until a report appears in the Kitchener- Waterloo Record. Those documents are available to him. We are talking about a miniscule portion of the production and inspection of our whole meat inspection system. If we are looking at 220 reports over a 20 month period then the system looks very lax. The Minister should be taking the responsibility, and not waiting until there is a press report like this, to ensure the safety and health of Canadians and their meat supply.


John Wise: Mr. Speaker, the Hon. Member should understand that this good work by the meat and food inspectors goes on day in and day out. We do not need a report from the Kitchener-Waterloo Record, nor do we need an article from any other newspaper in the country, nor do we need a question from the Hon. Member in the House. The Hon. Member knows that this goes on on a day-today basis, and that is why we have been able to maintain the best food inspection system in the world.
The other aspect that the Hon. Member should be aware of is the fact that we were requested for information of this kind. I am not sure if it was from the writer of the article to which the Hon. Member refers, but I recall that quite some number of months ago, perhaps even some years ago, or perhaps even before we were in office, a request was made. I do not know whether my predecessor granted approval for the release of
Oral Questions
that information, but I know that I did. The fact of the matter is that we were prevented from doing so because of a court injunction sought by a sector within the industry.
Therefore, it is unfair of the Hon. Member to ask me to make that information public. I am quite prepared to make that information public. However, I cannot ignore, and the Hon. Member cannot ignore, a ruling of a court of Canada. As far as I am concerned, that information should be made available to the public, but we cannot do so.


CONFLICTS OF INTEREST
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, I shall address my question to the Minister and not to the Prime Minister.
The Government makes a few good suggestions in its Bill on conflicts of interest. Unfortunately, with regard to the people's right to a detailed account of the assets of a Minister or Member of Parliament, the Bill states that the Commission can decide to keep such information secret. As this is unacceptable and as there are provincial Governments in Canada and Governments in Great Britain and the United States with systems which are automatically open to the public, will the Government accept amendments to establish a similar system at the federal level in Canada?


Flora Isabel MacDonald: Mr. Speaker, as the Hon. Member knows, the Government has just tabled the legislation with regard to conflict of interest. The Hon. Member will also know that this is the first time that a Government of Canada has decided to move by way of legislation in this very difficult and sensitive field.
In the legislation we have indicated that there will be an independent commission established to which cabinet Ministers, Parliamentary Secretaries, Members of Parliament, and Senators will disclose their liabilities and assets. That independent commission will have the right to decide what information will be made public.
We believe that an independent commission is in fact the best way to proceed. That does not indicate that as this legislation is debated, and as it comes before committee, changes cannot be made. That happens with legislation at all times.
I would like to indicate to the Hon. Member that this legislation is a big step forward. We think that an independent commission is the proper way to go. There will be no question as to whether or not it will have the right and the jurisdiction to decide what should be made public.

February 26, 1988
Oral Questions


John Edward Broadbent: Mr. Speaker, I compliment the Government on accepting the idea of a commission. I also compliment the Government on the idea that those rules should be applicable to Members on both sides of the House. It is desirable that there should not be an option whether such information is kept secret. All of that information should automatically be open to the public.
[ Translation]


OPPORTUNITY TO INTRODUCE BILL ON FINANCING OF POLITICAL PARTIES-GOVERNMENT POSITION
John Edward Broadbent: Mr. Speaker, I have a question about another aspect of the reform.
When the Government discussed this reform, mention was made of the possibility of introducing a Bill on the financing of political Parties, but we have not received such a Bill.
Does the Government intend to introduce such a Bill, yes or no?


Flora Isabel MacDonald: Mr. Speaker, as you are aware, this Bill deals with the role of parliamentarians solely. That is what the Bill is directed toward; that is what it focuses on.
On the other hand, the Prime Minister has indicated that there will be a total ethics package dealing with other issues as well. I cannot tell the Leader of the New Democratic Party at the present time when those other measures will be dealt with, but I can tell him that Cabinet is considering a variety of other measures.


REQUEST THAT NEW LEGISLATION BE INTRODUCED PRIOR TO GENERAL ELECTION
John Edward Broadbent: Mr. Speaker, I find that encouraging. Could the Minister perhaps be a little more specific at this time on two other aspects of a reform package which have been discussed before, one including the financing of political Parties and the other making changes in the system of patronage?
Could the Minister assure the House that both these aspects are being discussed by Cabinet? Can she assure us, if not with a precise date in mind, that there will be legislation in these areas before the next election?


Flora Isabel MacDonald: Mr. Speaker, the Hon. Member referred to patronage appointments. I should like to remind him that already major changes have been made in the way in which Governor in Council appointments are being reviewed. As he knows, they come before parliamentary committees, and I think one of the questions that we may have as a Cabinet is why so few of the Governor in Council appointments are being reviewed by
committee. I would think that there should be far more done in this regard.
I should also like to say to the Hon. Member that the questions he raises with regard to other parts of the ethics package are indeed being reviewed. I cannot give him exact dates at the present time. I think he will understand that it is not really possible to say that on April 20 or May 15 such-and-such will be done.
However, I want to indicate to him that the Government takes the issue very, very seriously.


OFFICIAL LANGUAGES
Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, the Supreme Court ruled yesterday that Saskatchewan will have to translate and pass in their French version all statutes adopted since its creation in 1905, or, as an alternative, to adopt a bilingual statute which would proclaim Saskatchewan an English-speaking unilingual province.
This ruling could apply equally to Alberta since this province was also carved out of the Northwest Territories and created by an act which contains the same provisions as the one for Saskatchewan.
My question to the Minister of Justice or to the Acting Minister is this: Is the Government willing to request by referral to the Supreme Court that it confirms that Franco-Albertans have the same linguistic rights as francophones in Saskatchewan?


Flora Isabel MacDonald: Mr. Speaker, as the Minister of Transport said yesterday, the federal Government is willing to provide assistance to the Saskatchewan Government to comply with the ruling of the Supreme Court.
As you know, Mr. Speaker, the policy of the federal Government is to promote the equality of both official languages. The Government and myself are willing to consider every option.

On the question with regard to Alberta, I would say at the moment that that question is premature to the federal Government. However, we will be working very closely with the provinces to see how, in the first place, the Supreme Court decision with regard to the Province of Saskatchewan can be implemented.


Jean-Robert Gauthier: I remind the Minister that the Supreme Court said what I just put to her, that indeed it could possibly
February 26, 1988

apply to the Province of Alberta, that it was cut away from the same territories and ruled by the same law.


GOVERNMENT ASSISTANCE TO PROVINCES
Jean-Robert Gauthier: Mr. Speaker, my supplementary question is directed to the same Minister. Given the Manitoba experience-and she will remember it clearly because she participated in that debate-and given the give and take in the question put to us by the Supreme Court on matters identical to the question put yesterday, but dealing with the Province of Manitoba, is the Government disposed, ready, or well intentioned enough to offer to the provinces of Alberta and Saskatchewan the same advantages which were offered to the Province of Manitoba, that is, as an exchange for less translation of all the statutes, possibly an extension of some of the services to the Francophone minorities in these provinces?


Flora Isabel MacDonald: Mr. Speaker, 1 should think that the record of the Government in what it has done already in this deal is an indication of the good intention of the Government of Canada to do everything possible to advance the equality of our two official languages.
I could tell the Hon. Member that very shortly the Government will be in touch with the Government of Saskatchewan to explore the ways in which we might be helpful in this regard and, as other matters arise, I would see us doing the same.


EXTERNAL AFFAIRS
William Alexander (Bill) Blaikie: Mr. Speaker, my question is for the Acting Prime Minister. It concerns the most recent revelations of the violent treatment by Israeli soldiers of Palestinian refugees.
I begin by hoping that the Acting Prime Minister would share the abhorrence, which I hope all Hon. Members feel, at the continuing violent response on the part of Israeli troops in the West Bank and the Gaza and our hope that the madness that is going on there must stop.
It is in that spirit that I ask the Acting Prime Minister-and 1 hope it will be the Acting Prime Minister-what the Canadian Government plans to do now in order to help bring about a solution in the Middle East.
Up until now the Government has been able to talk in vague, well-intentioned generalities about the need for a peace conference, but there has not been a Canadian position elucidated with respect to many of the difficult questions which must be asked about that conference and about the various intransigences that are held by the Israeli Government, by the Palestinians, and by various other parties.
Oral Questions
When will the Canadian Government say something definitive about what Canada thinks needs to happen?


Pat Carney: Mr. Speaker, the Secretary of State for External Affairs has made the Canadian position very well known on a number of occasions in the House. He has made it clear that Canada shares the abhorrence which the Hon. Member has indicated.
If he has specific points to make, I would urge him to give them to me and I will make sure that they are passed on to the Secretary of State for External Affairs.


LAND FOR PEACE PROPOSAL-CANADIAN POSITION
William Alexander (Bill) Blaikie: Mr. Speaker, of course the problem is that the Canadian position with respect to very difficult questions has not been clear, and I will give the Minister an example-the whole question of land for peace.
We know that the Israeli Government itself is divided between Mr. Shamir and Mr. Peres on this, so I ask the Government what is the Canadian position with respect to that proposal? Is the Government prepared to say to the Israeli Government that it needs to be more flexible with respect to these issues if there is ever to be peace in the Middle East? What is the Canadian Government's position on that?


Pat Carney: Mr. Speaker, it is the same question, therefore it is the same answer.


John Edward Broadbent: It was a specific suggestion. You asked for a suggestion and he gave you one.


Pat Carney: The Secretary of State for External Affairs has made the Canadian position fully clear many times in the House, and I will convey the intent of the specific question to him.


UNEMPLOYMENT INSURANCE
Mary Collins: Mr. Speaker, my question is for the Minister of Employment and Immigration. As I have brought this matter to the Minister's attention over the past year, he knows the difficulties faced by parents when infants are born prematurely or with severe health problems and must remain in hospital for a considerable period of time.
On the happy day when the infant comes home, the mother needs to be able to take her maternity leave to care for the child, but present regulations under the Unemployment Insurance Act preclude that, requiring her to take maternity leave from the date of confinement.

February 26, 1988
Oral Questions
Can the Minister assure this House that he will make the necessary adjustment in unemployment insurance laws, changes that will not result in any increased costs to the fund so that in such special situations mothers will have the flexibility to postpone maternity leave until the new-born child is released from hospital?


Hon. Benoit Bouchard (Minister of Employment and Immigration):: Mr. Speaker, I thank the Hon. Member for her question. I know she has a keen interest in these issues. Although we are sympathetic to the case, the Hon. Member should know that if we wanted to go in the direction she has proposed we would have to change the legislation. We have already proposed making a change in one case, what we call the Mclnnis case.
Of course, before making any change in another direction I would first like to have the opportunity to make an indepth assessment of the case, and I am sure that the Hon. Member will help us to find a solution to the problem to which she was referring.


PRIVATIZATION
Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, my question is for the Acting Prime Minister. Canadians are very concerned and confused by the Government's position on the privatization of Petro-Canada. The Minister of Energy says the Government will go ahead with privatization, and the Deputy Prime Minister says that it will not.
Canadians are also concerned about the Government's intention to sell the Radiochemical Company, a division of Atomic Energy of Canada Limited, a company which deals with the very sensitive subject of irradiation. Why does the Government want to sell to the private sector a company that deals with sensitive products, with irradiation, which accounts for 80 per cent of the net income of Atomic Energy of Canada Limited?


Flora Isabel MacDonald: Mr. Speaker, I think it is important to note that yesterday when the Deputy Prime Minister was responding to similar questions, he set out the position of the Government and he at the same time quoted the Minister of Energy, Mines and Resources in both cases. Both Ministers said the Cabinet has yet to make a decision on this issue. I refer to the question of Petro-Canada, Sir.
There has been no decision with regard to privatization. The matter has not been decided. I think the Hon. Member should not try to distort and confuse the issue.
With regard to the question of the component in the AECL that he raised, I can only say that various aspects of companies are being looked at. I do not have the information that he seeks at the present time, but I will be sure to take his question to the Minister of State for Privatization.


REPORTED BID FOR RADIOCHEMICAL BY LA VALIN INCORPORATED
Russell Gregoire MacLellan: Mr. Speaker, Nucleonics Week says that the most likely buyer for the Radio Chemical Company is Lavalin Incorporated. I understand that Lavalin submitted a bid in November for the Radiochemical company. Will the Government state whether, in fact, Lavalin Incorporated has submitted a bid for Radiochemical Company and will the Minister state what the Government's position is with respect to Lavalin's bid?


Flora Isabel MacDonald: Mr. Speaker, I can tell the Hon. Member that there have been expressions of interest in this component from companies and organizations all across the country. It happens to be a very good operating unit, and obviously there is interest in it. I do not know the specific of any particular interest that has been expressed, but I can give the Hon. Member the assurance that I will bring his comments to the attention of the Minister.


CANADA-UNITED STATES FREE TRADE AGREEMENT-PROVINCIAL JURISDICTION
Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, my question is for the Minister for International Trade.
I would like to ask the Minister about the commitment which the Government of this country made in Halifax in 1985 to the provincial Governments that all matters under provincial jurisdiction in trade would "have a situation that all provincial Governments support and are ready to implement" so far as the free trade agreement is concerned. Now reports say that federal officials are prepared to stomp on the provinces. They also report that there is a likelihood of suits from the provinces themselves.
I want to ask the Minister point blank whether she will confirm or deny that there is a plan afoot in the Government to bring legislation forward which will force provincial Governments to do in trade areas what is not what they wish to do.


Pat Carney: Mr. Speaker, the Hon. Member correctly points out that it was at the Halifax meeting that our Government made the decision to involve the provinces in the free trade agreement. It was the

February 26, 1988

kind of consultative step which had never been carried out by any previous Governments in terms of any matters pertaining to trade.
Unfortunately that is the only correct statement the Flon. Member made in his question. Everything else he brought forward is totally hypothetical. There is no legislation before the House, and all these allegations about stomping on the provinces are being made totally on the basis of hypothetical suggestions and have no basis in fact.


MINISTER'S POSITION
Steven W. Langdon: Mr. Speaker, the point is that the commitment was not just the involvement of the provinces, the commitment was that all provincial Governments would support and be ready to implement any legislation in trade areas affecting them which were to be put into this agreement.
Will the Minister make a commitment to that effect yet again, or is she prepared to break this promise? Does she not realize that a constitutional crisis of a major sort could emerge if she proceeds in the path the Government seems to be taking?


Pat Carney: Mr. Speaker, as you know, I covered this ground earlier today when 1 pointed out that the Prime Minister has made it clear on a number of occasions that Canada's constitutional right to deal with international treaties is just not at issue here.
I can again quote him from his comment on February 10 when he said that "the Government of Canada on behalf of the people of Canada has concluded an international treaty. We believe it is very much in the national interest. We will submit it to Parliament at an appropriate time and we will ensure that the treaty is respected".


CANADIAN SECURITY INTELLIGENCE SERVICE
Sergio Marchi: Mr. Speaker, my question is for the Solicitor General. It relates to the role played by CSIS and the Government's bungled attempt to remove Mr. Mohammad from Canada.
On Wednesday, the Minister categorically denied in the House,that CSIS was involved. Yesterday he stated that CSIS did have a connection, and today we learn that Mr. Ron Atkey, chairman of the Security Intelligence Review Committee, has initiated an investigation into the entire involvement of CSIS in the Mohammad affair. I think it is time that the Minister came clean with this House and with Canadians, and I urge him to do so now.
Oral Questions
Therefore, I would like to ask the Minister after CSIS learned of the plan to remove Mr. Mohammad, and after two CSIS officials met Mr. Mohammad and the RCMP at the Toronto Airport before his departure, what follow-up action was taken by CSIS?


Hon. James Kelleher (Solicitor General of Canada):: Mr. Speaker, first I would like to deny categorically that this Government or any of its officials in any way bungled the travel arrangements of Mr. Mohammad. I also strongly deny the allegation that two CSIS officials had a meeting with Mr. Mohammad at the airport. There was no meeting. I have admitted that there were some CSIS officials at the airport, which was perfectly normal. They certainly had no meeting whatsoever with Mr. Mohammad.
As I also stated yesterday, after a morning meeting with the Deputy Commissioner of the RCMP and the Director of CSIS, I have been advised that CSIS did absolutely nothing that contributed to the failure of the travel arrangements for Mr. Mohammad.


Sergio Marchi: Mr. Speaker, this is becoming a three-ring circus. Because the Minister is obviously refusing to answer the question, I suppose we will have to wait for Mr. Atkey's investigation to find out the truth. The Minister should not take it lightly that CIRC is investigating CSIS on this whole matter.


IMMIGRATION
Sergio Marchi: Mr. Speaker, my supplementary question is directed instead to the Minister of Immigration. While public confidence has been haemorrhaging over the Government's bungling and incompetence in the Mohammad case, we learned this week that another individual, Mr. Abraham Finkel, who lied to immigration officials consistently for eight years, was convicted of serious and violent crimes and was repeatedly refused entry by successive Ministers. However, he was granted landed immigrant status by the federal Cabinet. Can the Minister explain the glaring contradictions?
On what specific grounds was Mr. Finkel accepted? Does the Minister not believe that this dangerously blurs the one set of standards by which all applicants must be judged as opposed to the ad hoc approach that is bleeding public confidence and public integrity?


Benoît Bouchard: Mr. Speaker, I am very amazed that the Hon. Member could mix up two cases which are totally different.

February 26, 1988
Oral Questions
There is no relationship between Mr. Finkel's case and Mr. Mohammad's case.
1 think Mr. Finkel's case is very clear. Mr. Finkel is a 63-year-old man who has been living in Canada for eight years. Fie admitted that he had been convicted. I have all the documents necessary to prove that he was convicted and he admitted to the conviction. When he came here to Canada, he gave us fingerprints and we made a check. When he lived in Montreal, all the people living around him admitted that he was a good citizen. Today he respects the conditions under which we admitted the man to Canada. It is an old story, one year old. I maintain that Mr. Finkel is now a good Canadian.
There is no question about changing the decision. I want my hon. friend to understand that, as Minister, I have to make decisions. One decision was made for Mr. Mohammad, another decision was made for Mr. Finkel. I challenge my friend to tell me that Mr. Finkel is not today a good Canadian.


SPECIAL CANADIAN GRAINS PROGRAM
Mr. Stan J. Hovdebo (Prince Albert):: Mr. Speaker, my question is for the Minister of Agriculture and deals with the Special Grains Program. The Minister will be aware that because of technical problems several hundred farmers were missed when the deficiency payment application forms were mailed out. Some of these farmers are from Saskatchewan and some are from Quebec. Six communities affected happen to be in my constituency.
Without these application forms, farmers are ineligible for deficiency payments. Will the Minister ensure that the farmers involved will be sent application forms directly in the mail?


John Wise: Mr. Speaker, I appreciate the Hon. Member drawing this matter to my attention because I must admit, and I do not mind admitting, that I was not aware of it.
I certainly would give the Hon. Member the assurance that we will not miss any producer, particularly not any producer in his constituency. In fact, if the Hon. Member is going to his constituency over the weekend, he can phone my office and I will see whether or not we have some application forms that he might take with him.


DEADLINE FOR SUBMITTING APPLICATIONS-REQUEST FOR EXTENSION
Stanley J. Hovdebo: Mr. Speaker, because Treasury Board regulations set the application deadline at March 16, it is inevitable under the circumstances that some of the farmers will not get their application forms in time. Will the Minister make arrangements for extending that deadline at
least in the case of farmers who were unable to get their application forms in time?


John Wise: Mr. Speaker, I think that is a very logical request and it is one with which we will want to comply. Of course, the Hon. Member can have my assurance that I will do everything possible, and I will seek and I am sure I will receive the necessary support from my cabinet colleagues to ensure that no eligible producer is left out of the Special Canadian Grains Programs. Again, I appreciate the Hon. Member bringing this matter to my attention.


TAX REFORM
Mr. Raymond Garneau (Laval-des-Rapides):: Mr. Speaker, in the absence of the Minister of Finance I will direct my question to the Minister of State for Finance. The Minister certainly knows that community leaders of numerous mining areas have recently formed a special committee to save the flow-through shares program that the Minister of Finance virtually eliminated in the tax reform proposal by phasing out the earned depletion allowance.
Considering the fact that millions of dollars were raised since the early 1980s with the flow-through share mechanism to finance resource exploration in remote areas, and considering that the elimination of the earned depletion, together with last October's stock market crash, killed the financing prospects for mining exploration, will the Government reverse this ill-considered proposal and announce that the earned depletion allowances on flow-through shares will be maintained?


Hon. Tom Hockin (Minister of State (Finance)):: Mr. Speaker, the Hon. Member omits two crucial facts about this very important mechanism. I agree with him that the flowthrough share mechanism has been an important contributor to exploration. In the period between the tax reform announcement in June and the Ways and Means Motion in December, we made a number of technical improvements to the suggestions made in the June document. We are also monitoring very, very carefully mining exploration activity to make sure that the changes we have made will not adversely affect the mining sector. I am told that exploration levels are strong now and are expected to be strong in the spring, but we will monitor it very carefully.


FUTURE OF REGIONS-GOVERNMENT POSITION
Raymond Garneau: Mr. Speaker, the Special Committee is aware of everything the Minister just said. After 1988, however, the tap runs dry, and these people are coming to Ottawa-not just mining operators but mayors
February 26, 1988

of municipalities and chambers of commerce-because they feel that as far as regional development is concerned, this Government has failed to deliver, and, on top of that, it is eliminating the flow-through shares program.
My question to the Minister is this: Since the Special Committee will be bringing people from every corner of this country to attend its meeting on March 1, what kind of answer does the Government intend to give these people who see the future of the mining industry in our regions, and especially the economic survival of these regions, in terms of jobs? What kind of answer is the Government going to give these people when they come to Ottawa on March 1 ?


Thomas Hockin: Mr. Speaker, the Hon. Member knows that initial public offerings in the equity market are down across all sectors. That means that the Government has to be especially alert to sectors such as the mining industry that may suffer as a result of the general decline in the stock market. That means that flowthrough shares together with everything else are being examined while we monitor that exploration.
The Hon. Member knows that at present exploration levels are strong. We expect them to be strong in the spring. If it does not continue that way, the Government will act.


REQUEST THAT GOVERNMENT INTRODUCE NEW PROGRAM
Mr. Nelson A. Riis (Kamloops-Shuswap):: Mr. Speaker, my question is directed to the same Minister and is on the same issue. The Minister knows how important this is for communities right across Canada. Virtually every sector and every mining community are now concerned about the Government's decision to gut the flow-through share program. The Minister will know that when the tax programs for the oil and gas sector were phased out, the Government promised to implement new programs to offset the losses from the tax changes.
Will the Minister of State for Finance indicate clearly to the House that, since the Government has now decided to gut the flow-through shares program, there are plans to bring in a program that will ensure that mining exploration will take place right across Canada, and particularly to ensure that the benefits flow to the small and medium-sized exploration and mining companies as opposed to the large multinationals?


Thomas Hockin: Mr. Speaker, my friend has raised a question which, quite frankly, is a piggyback on the previous question. I am reminded of last June when we brought forward tax reform and we left in place the flow-through share mechanism with some changes. At that time we were attacked by the Hon. Member for Ottawa Centre for leaving this preference in place. We were told that it indulged rich businessmen, dentists and doctors who had money to invest in flow-through shares.
Oral Questions
We have saved flow-through shares and made some technical improvements to them. We will continue to make technical improvements and to monitor exploration levels very carefully.


AGRICULTURE
Mr. Vic Althouse (Humboldt-Lake Centre):: Mr. Speaker, my question is for the Minister of Agriculture. In light of revelations in the Kitchener-Waterloo Record concerning reports of dirty meat from 1986 to October of 1987, is it the Minister's intention to make a report to the House by way of Ministerial Statement to explain the workings of the meat inspection branch and what improvements have been made since that time, particularly when meat is transferred from one plant to another and is reinspected? That is where most of these problems were found. Similar inspections do not occur when meats leave the original plant and go directly to the consumer. Consumers are very concerned about this, particularly about the allegations that the official inspectors have been told to ease off because every time they find a problem it means downtime.
Will he be giving us a full report in the House in the next few days?


John Wise: Mr. Speaker, I am not so sure whether this is the appropriate forum to give a report on this incident. I have no objection to it but 1 would suggest that in my opinion an appropriate starting point would be to have the issue referred to the Standing Committee on Agriculture. Appropriate officials from my Department could be brought before the committee and Hon. Members from all sides of the House could pose those questions in seeking that information. I am sure they will find my officials on this issue, as on all issues, will be very fair, frank, accurate and forthcoming.


Mr. Deputy Speaker:: There will be one question from the Hon. Member for Notre-Dame-de-Grace-Lachine East.


EMPLOYMENT
[Stage Direction]
Hon. Warren Allmand (Notre-Dame-de-Grace-Lachine
East): Mr. Speaker, my question is directed to the Minister of Employment and Immigration. A recent Statistics Canada
[Stage Direction]
February 26, 1988
Tabling of Documents
report indicates that unemployment among older workers, those over 54, is increasing at a disturbing rate. In fact, many in this group are giving up after a long search and leaving the labour market.
Two years ago the Government cut the Labour Adjustment Benefits Program which helped those older workers, clearly promising to replace it with a $32 million Program for Older Worker Adjustment. That was promised in the 1986 Budget but after two years nothing has been done.
In light of these recent statistics when will the Government finally move on this proposal which is critically needed by older workers?
Benoît Bouchard: Mr. Speaker, I think the Hon. Member for Notre-Dame-de-Grace-Lachine East is aware of the fact that the Minister of Labour is responsible for this matter. In fact, he is very busy negotiating with the provinces. The Hon. Member will agree it would be hard not to involve the provinces in a matter like this. The negotiating process is a difficult one. However, my colleague the Minister of Labour told me recently that in the case of several provinces, we could expect to complete the process very shortly.



ROUTINE PROCEEDINGS

[Stage Direction]
[ Translation]

Hon. Doug Lewis (Minister of State and Minister of State (Treasury Board)):: Mr. Speaker, pursuant to Standing Order 106(8) I have the honour of tabling, in both official languages, the Government's response to petitions Nos. 332-3886 to 3323899, inclusive.


William Alexander (Bill) Blaikie: Mr. Speaker, I have the honour to present petitions signed by people concerned about the treatment given to workers at Canada Packers in Winnipeg as a result of the plant shut-down. The petition is the following:
Whereas the Government of Canada requires employees to pay unemployment insurance premiums, premiums are paid by employees who are salaried employees and employees who are members of a union; whereas all citizens of Canada regardless of their job status have the right to expect and receive fair and equal treatment; whereas the Government of Canada has with discrimination chosen to make a distinction between the earned benefits of salaried and union employees with respect to severance or termination benefits according to Regulation
57(3)(L)(ii); whereas this deliberate act creates a hardship and disadvantage for union employees who remain loyal citizens of Canada; whereas the Government recognizes that its Regulation 57(3)(L)(ii) is discriminatory by limiting such discrimination to a period ending March 26, 1988, the undersigned petitioners, many hundreds of them, call upon Parliament and the Government to amend the said regulation retroactively so as to provide all citizens of Canada with equal favour of benefit and to remove the discrimination which is now making a difficult situation for union employees at Canada Packers even more difficult.


Nelson Andrew Riis: Mr. Speaker, it is my honour to present a petition pursuant to Standing Order 106 on behalf of a number of residents of Swift Current, Saskatchewan. They are concerned that the Conservative Government has no mandate from the people of Canada with which to conclude a free trade agreement. They believe that the trade deal negotiated by the Government threatens the very fabric of Canadian political and economic sovereignty since it removes the power of the Canadian Government to effectively control foreign ownership, to develop Canadian energy resources in the best interests of Canadians, or to equalize opportunities between the regions.
Therefore, since they are concerned that this trade deal would deny Canada the policy freedom to determine its own economic future and would undermine our ability to provide a society distinct from that of the U.S., they are asking Parliament to dissolve to allow the people of Canada an opportunity to either accept or reject the proposed trade deal with the U.S. through a national general election.


Mr. John Reimer (Kitchener):: Mr. Speaker, 1 have the honour to present eight petitions from residents of the Kitchener-Waterloo region. They call upon the Government to act quickly to bring in and pass Bill C-54. They call upon Parliament to effectively deal with the social evil of pornography and its attacks upon children, women and the family, and thereby the health of Canadian society.
These eight petitions and the 502 signatures they contain bring to a total of 2,133 the number of signatures from the Kitchener-Waterloo region. I urge the Government to act with all dispatch to bring this Bill in and bring this issue of pornography to a conclusion.


Mr. John Parry (Kenora-Rainy River):: Mr. Speaker, I have the honour and duty to present a petition containing some 230 names, most of them residents of the community of Fort Frances in my riding.
The petition protests the inequitable and unfair application of the northern tax allowance. The petitioners complain of the
February 26, 1988

fact that some communities are designated to receive this allowance whereas others, in many cases directly adjacent, have been excluded.
Therefore, the petitioners humbly call upon Parliament to designate all communities in tier three ridings, remote and isolated as they are, as eligible for the allowance.


John Edmund Parry: Mr. Speaker, the second petition is signed by many residents of the community of Fort Frances in my riding.
They protest the Government's negotiation of a treaty with the U.S. on free trade. They protest that the Government never had a mandate to enter into such a treaty and therefore call upon Parliament to dissolve so the people of Canada may judge this question by means of a national general election.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Douglas Grinslade Lewis: Mr. Speaker, today we are answering questions numbered 248 and 253.


Mr. Nickerson: Does the government distribute free condoms to Treaty Indians and, if so,
on what date did this practice commence and how many have been distributed?


Hon. Jake Epp (Minister of National Health and Welfare):: Condoms have been available to Treaty Indians on request at most nursing stations and health centre serving Indian communities for over ten years. As AIDS education programs are developed by communities, it may be that a more active distribution policy will be adopted by band councils. In that case, the Medical Services Branch, of the Department of National Health and Welfare, will provide the supplies and distribution network recommended. The only figures available are the following:
No. of condoms supplied:	1986/87	67,670
1987/88 to date	101,460


Mr. Redway: Since September 4, 1984, did the Ministry of State for Science and Technology make grants and/or loans to persons or corporations, nongovernmental organizations and governments within Metropolitan Toronto and, if so, in each case, in what amount and for what purpose?
Order Paper Questions


Mrs. Suzanne Duplessis (Parliamentary Secretary to Minister of State (Science and Technology)):: In so far as the
Ministry of State for Science and Technology is concerned, since September 4, 1984, grants have been made only to the Canadian Institute for Advanced Research (CIAR). These totalled $1,498,260 in fiscal year 1987-88, the first year in which CIAR became eligible for the grants.
In June, 1986, Cabinet approved payment of up to $7 million to the Institute over four years (1987-88 to 1990-91) to match contributions of the same amount from the private sector. Matching grants to CIAR have a ceiling of $1.5 million in the first two years and $2 million annually thereafter and are conditional upon a satisfactory evaluation, to be submitted to Cabinet in March, 1988.
President: Dr. J. Fraser Mustard Executive Director: Dr. P. B. Munsche Headquarters: Toronto
1.	In June, 1986, Cabinet approved payment of up to $7 million to the Institute over four years to match contributions of the same amount from the private sector. The Treasury Board submission was approved in December, 1986.
The grants commenced in the 1987-88 fiscal year and end in 1990-91. Payments for the last three years are conditional upon an evaluation of the work of the Institute by the Minister of State for Science and Technology, to be submitted to Cabinet in March, 1988.
The grants are administered by the Ministry of State for Science and Technology.
2.	The matching grants are designed to support the work of CIAR, which aims to build research strength in areas of economic and social importance in Canada; to strengthen the training of highly qualified scientific personnel; to encourage greater private sector investment in basic and applied R&D; and the formation of closer links between university and industry research activities.
3.	(a) Government funds will be provided to the Institute in amounts equal to the eligible private sector contributions received by the Institute, up to the maximum annual levels.
(b)	For 1987-88, eligible contributions will be those received by the Institute between June 12, 1986 and March 31, 1988. For 1988-89 and future years, eligible contributions will be those received in the current or preceding fiscal year. Contributions in excess of the maximum may be carried forward to the following fiscal year for matching purposes. The grant to CIAR will be authorized on receipt of satisfactory evidence regarding the eligibility of contributions. Payments may be made up to four times per year.
(c)	The Institute identifies high-priority areas for long-term research of major economic and social importance, recruits world-class scientists to work in those areas, and creates networks of researchers using modern communication technology and regular working sessions. The Institute, by building on existing facilities in universities and industry,

February 26, 1988
The Budget-Mr. Parry
offers a low-cost means of strengthening R&D. Its programs focus on research for the core technologies of the future, on the advancement of fundamental knowledge in the natural sciences; and on aspects of social and economic change.
(d)	The clientele served are researchers based in universities, primarily in Canada but also in the United States and United Kingdom. CIAR's revenues come from corporations (over 50 per cent), foundations (25 per cent) and individuals. Strong support from industry ensures the continued relevance of CIAR's work to the long-term competitive position of Canadian industry.
4.	Expenditures under CIAR are entirely matching grants (grants and contributions) as follows (maximum grants, $ millions):
1987-88	1988-89	1989-90	1990-91	Total1.5	1.5	2.0	2.0	7.0
There are no person-years or O&M expenditures allocated to the program.
5.	The Ministry of State for Science and Technology as been directed to evaluate the work of the Institute and report to Cabinet in March, 1988. Grants for the 1988-89, 1989-90 and 1990-91 fiscal years are conditional on this evaluation. The evaluation will examine the relevance of CIAR's research areas to broad government and industry priorities and the effectiveness of the Institute in achieving its objectives.


Douglas Grinslade Lewis: I would ask that the remaining questions be allowed to stand.


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


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Wilson (Etobicoke Centre):
That this House approves in general the budgetary policy of the Government.
John Edmund Parry: Mr. Speaker, I am glad to have this opportunity to rise and add my comments to those of my colleagues on the matter of the Budget that never was brought down by the Minister of Finance (Mr. Wilson).
The Conservative Government, in its four Budgets so far, has steadily undermined the tradition of budgeting and the tradition of budget speeches being presented before Parliament. We have seen an Olympian Budget-very appropriate because the Olympics are currently underway in Calgary and in his speech the Minister of Finance made reference to them. However, this Budget is not Olympian in its majesty, it is simply Olympian in its detachment from the everyday reality facing Canadians.
The Finance Minister had a real opportunity to move toward greater regional fairness, to redress some of the inequities in the country, to halt rising interest rates which have been rising in real terms, and to make the system fairer. Instead, the Finance Minister basically stood up before Canadians and said "We are saving our announcements for the politically opportune time". He stated that the Government had a commitment to an orderly Budget process but undermined it by introducing only minor changes in this Budget and by failing to address the major problems which are facing Canada today.
On a quick conspectus of this do-nothing Budget we find that in general terms it takes more from consumers, leaves more with corporations, does little for those who are less well off, and does something for those who are well off. The Prime Minister (Mr. Mulroney) warned last year that "We are in the process of building two Canadas, one which is rich and promising and one which is under-developed and underemployed". That warning seems to have been lost on the Minister of Finance. I think we should repeat that warning to the Minister of Finance and to the Prime Minister, because if two such Canadas are being built they indeed are the prime architects, willing or unwilling, of the inequities which are increasingly developing in Canada today.
That is something which could easily have been seen by reference to experience of other industrial countries, something which could easily have been provided for in the Government's budgeting process. As I am sure the Prime Minister and the Minister of Finance are well aware, if that is allowed to continue it will threaten the very identity of the Canada we have today.
Canada, after all, was founded on notions of regional equity. They are enshrined in the legislative process and the budgetary process. We have such things as regional equalization, regional allowances for higher rates of unemployment. We have not seen that with which a New Democratic Party government would provide the country, a proactive approach to regional development, based not only on the understanding that it is good for areas that are under-developed to be economically developed but also on comprehension of the fact that in the long run the areas in which the economy is overheating are not going to see benefit to their average residents at all, but mainly benefit to those who control the levers of power and wealth in
February 26, 1988

those major cities such as Toronto, in particular, which are benefiting from the economic upturn.
This Budget adds $575 million to the $22 billion total increase in sales taxes since the Government was elected. The cumulative increase in sales taxes is taking $700 to $750 a year out of the pockets of the average family. That makes any cut in income taxes simply an exercise in robbing Peter to pay Paul, taking out of one taxpayer's pocket and putting back into another. Of course, we know that when the Tories do that which is put back is always significantly less than what has been taken out.
The lip service that has been paid to child tax benefits is another defect in the Government's Budget. Instead of concentrating on the sin taxes, the Government seems to have judged that gasoline is a commodity which should be priced increasingly higher, beyond the reach of ordinary Canadians. We have seen the tax on car gasoline. We know it is going to cost more. We know that when the Minister of the Environment (Mr. MacMillan) was the Minister of Tourism he spoke out against higher taxes on gasoline.
Let us not ignore the effect on the aviation industry of the one cent a litre increase in tax. This will drive up costs, particularly for those small operators for whom fuel is a large component of their cost structure. This will marginalize some airlines which have been making it and will jeopardize some airlines which are presently marginal in their operations, particularly the smaller ones.
In my riding of Kenora-Rainy River there are some airlines which operate only one or two planes, strictly for local needs, in air taxi or charter operations, or serving the tourism industry by flying hunters and fishermen in and out of the lake areas. These operations are marginalized by that sort of tax.
The $750 which is taken out of the pockets of average families is reflected by the 21.6 per cent which sales tax revenues are projected to increase this year That is a pretty massive increase in revenues that the Government is predicting. Indeed, it is clearly an indication that the Government's commitment to tax reform is running out of steam. The Government's commitment to revenue generation proceeds full speed ahead, and the Government is losing its commitment to switch from the regressive, inequitable sales tax, which falls more heavily on those with lower incomes than those on higher incomes, to giving the revenue side of the ledger priority.
Average Canadian families want the Government to be called back to its commitment to a more equitable tax system. What they are afraid of, and what the New Democratic Party warns against, is that the Government may be saving such an announcement for sales tax reform until shortly before the next election. The saving of announcements for when they are politically appropriate and politically advantageous calls into question the proud statements of the Minister of Finance that the Government would stay the course with its Budgets and would budget in a business-like fashion. It is clear that the
The Budget-Mr. Parry
Budget is being presented in as political a fashion as even a Liberal Budget ever was.
During the period of the Government's mandate personal incomes have barely kept pace with inflation, but personal taxes will rise more than 16 per cent in 1988. Despite all the lip service that has been given to tax reform, and despite the statement of the Prime Minister that the rich must be made to pay and to pay handsomely, the Government is allowing
60,000	profitable corporations to continue to pay no corporate income tax. That situation flies in the face of equity and also in the face of logic. The Government has stated its need for revenue sources. The Government has given its commitment to deficit reduction. It has not, however, followed the logical next step and gone to the pools of finance which are available to assist in those objectives.
Let me make a simple comparison between the federal Government and the Province of Ontario. In the Province of Ontario every corporation pays what is called a capital tax. This is a minimum tax on corporations. It is hardly onerous. For a small corporation it represents a minimum of $50 a year. That charge goes, obviously, to replenish the coffers of the Province of Ontario. The larger corporations are taxed on an ad valorem basis, a percentage. I believe it is one-fifth of one per cent of their available capital. Every corporation that has an establishment or is registered in the Province of Ontario is paying at least a nominal amount by way of a minimum corporate tax.
Another example is the United States where the Government is at least as conservative as this Progressive Conservative Government-a delightful juxtaposition-as it describes itself. The American Government has seen the real need for a corporate minimum tax and has introduced as part of its tax reform package a 20 per cent minimum tax on corporations.
We are not necessarily talking about onerous taxes on corporations which, for one reason or another, have not reported a profit. We are not even talking of going to the corporations and trying to collect at least some percentage of the money they owe as deferred income taxes which shows up on their balance sheets. We are talking about imposing some nominal degree of taxation at least on corporations which have been very profitable and yet have paid no taxes.
I am sure others have put on the record the cases of individual corporations, including one with profits totalling $117 million and no taxes, another with profits of $220 million and a tax credit of $32 million, and another with profits totalling $39 million and no taxes paid. I am sure other Members have read the names of some of these corporations, so I will not repeat them here.
However, this shows the contrast between those 60,000 profitable corporations that continue to be off the tax rolls, untouched by the Government's revenue garnering measures, and the approximately one million working poor who have

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been added to the tax rolls as a result of the federal tax reduction and only partial indexation of the tax system.
1 am sure other Government Members will rise with pride to say that the Government having more people to the tax rolls is good because it indicates that more people are working and therefore paying taxes. However, they will be either ignoring or wilfully concealing the reality that while many taxpayers have come on to the tax rolls as a result of an increase in their income, many are earning no more than they were earning four years ago in terms of real dollars but are paying taxes now when once they were not.
The Government pays lip service commitment to child care in Canada through this Budget. Child benefits have been cut because of deindexation in past budgets and there is no substantial improvement to that in this Budget. From 1989 onwards the child tax credit will be limited to an indexation factor of the amount over 3 per cent, which guarantees a 3 per cent decline in real terms of the dollar value.
The cumulative effect of deindexation of child benefits is that by 1991 the child benefit system will be reduced by about $1.5 billion, approximately one-third. Obviously, that is significantly larger, in fact a multiple of the amount that the Government envisages putting into a child care program. Again, this is evidence of the Tory syndrome of saving three times as much on the swings as it is prepared to spend on the roundabouts, even after it has advertised such a strong commitment to child care in Canada, after it had trumpeted its initiatives as providing solutions. Of course, those measures merely paper over the cracks of the existing problem.
One of the most significant measures the Government could have taken in the Budget to increase prosperity, promote economic growth within Canada, and to try to work toward a better life for Canadians, was to reduce the interest rates that Canadians pay. Many economists believe that the so-called trade agreement between Canada and the United States, even in its most favourable manifestations, does not have even one-half the economic potential that a drop in interest rates would have in promoting Canadian business.
Presently, Canadian interest rates are kept artificially higher than those in the United States in order to shore up the value of the Canadian dollar, but also to assist the Bank of Canada in its futile attempt to bring inflation down to a zero percent level. Reducing inflation to zero per cent is a prime example of erecting a macro economic measure into an instrument of policy. Of course, the inflation rate is nothing more than a macro economic measure.
Fortunately, Canadians have economic choices which they continually use in making decisions about the mix of goods and services that go to support and essentially make up the lifestyle that we enjoy. Each and every one of us, in our qualities as spenders, are continually involved in controlling inflation by deciding on what and what not to buy. Canadians may choose not to buy strawberries when the price is too high, or switch vegetable and meat choices as the price fluctuates. Inflation is
a macro economic measure that is very useful but, as a target, zero per cent inflation, which has overtaken the minds of the Bank of Canada and been erected into a priority, is essentially a proxy goal of very limited utility.
None of us want to go back to the days of the Liberal Government when inflation was allowed to run riot and interest rates soared to levels of 21 per cent to 23 per cent for ordinary mortgages. Everyone wants to control inflation, but we as parliamentarians must demand of the Government that it pursue a reasonable policy that trades off inflation control for economic development, instead of completely neglecting that economic development for the goal of controlling inflation.
Economists have estimated that an 84-cent dollar is the point at which we become non-competitive with the United States, so that attempting to keep the dollar value below the 79-cent or 80-cent level provides a very substantial margin in which Canadian business and Canadian industry is still competitive.
The Premier of Quebec is the fondest friend of the Prime Minister on many issues. While the Hon. Member for Laval-des-Rapides (Mr. Garneau) may deplore that fact, he is powerless to change that by any jot or tittle. However, the Premier of the Province of Quebec said on February 8 that there should be lower interest rates and that any further increase will jeopardize our exports.
The fact is that if interest rates in Canada could be reduced by approximately 1 per cent there would be increases in output and employment that would, even in as short a period as five years, exceed even the notational gains that the Government's most favourable studies postulate as a result of the trade deal.
A cut in rates would help the average consumer. Consumer spending accounts for approximately 60 per cent of Gross National Product and if growth is to continue consumer spending will have to remain high. A cut in interest rates would substantially reduce the cost of servicing the Government debt, and that would leave more money for important social programs and job creation.
The Budget itself estimates that a 1 per cent decrease in interest rates will cut the deficit by $1.4 billion in one year and by $9.5 billion over four years. Certainly that would be a measure that this Party could endorse as being very substantially effective, not only in deficit control but ultimately in increasing the revenue side of the ledger, as more people would be working.
The Budget fundamentally ignores the fact that unemployment in eight of the 10 provinces remains at recession levels. There is no commitment to increase the very nominal funding that was granted to northern Ontario by means of the FED-NOR program. There is no commitment to the promotion of industrial development in other parts of the country.
The Government had led Canadians to expect that the Budget process would be done on a businesslike basis. It has
February 26, 1988

led Canadians to believe that Progressive Conservative budgets would always be substantial, would be responsible, would be full of measures that would be significant even though people may not like them. On all three scores, the Government has retreated from that commitment.


Gabriel Fontaine: Mr. Speaker, after listening to the Socialist Member's comments on the Budget Speech, I would appreciate it if he would explain his position on the Government of Canada's allocation of tax revenue, because if one is prepared to comment, one must also be clear. I want to ask him how he can justify the fact that the New Democratic Party is abusing tax measures that make it easier to contribute to political parties by using such contributions to provide political support in municipal elections.
Furthermore, and this still concerns the use of funds, how can he justify the fact that his Leader, the Hon. Member for Oshawa (Mr. Broadbent), made his telephone code available in Abitibi to the Dean of the University of Quebec in Rouyn, Mr. Trudel, and to a former senior officer of the Quebec Provincial Police who is now his principal organizer? These people, who are supposed to be paragons of openness and honesty, now have the telephone code of the Hon. Member for Oshawa. They use the code in Abitibi for their political organizers, Mr. Speaker. I wish he would explain that.
Finally, to get back to the Budget in general, I wish those people in the Socialist Party would tell us how they think wealth, products or services are created. We must have services, Mr. Speaker, because the Socialists are parasites who congregate in countries where a lot of goods and services are created. They flock to economies that are profitable and take advantage of what they have to offer, and then they can afford to make a lot of grand speeches. I wish they would start by shedding some light on their own conduct and the fraudulent use of taxpayers money, through their Leader, Mr. Speaker.


John Edmund Parry: Mr. Speaker, I cannot believe that the Hon. Member for Levis would think that I could reply to such farfetched allegations. He knows quite well that, if he wants to lay charges, there are other ways to do so, and he also knows that this has nothing to do with the recent Budget, which is the subject now being debated.
Mr. Speaker, the Hon. Member made these accusations during statements under Standing Order 21. He repeats them at every opportunity, but he knows quite well that I cannot discuss such matters during the Budget debate. He paints a rather horrifying picture of the nature of socialism, but I cannot believe that he is not aware of the success of certain socialist economies, for instance in certain countries in Western Europe and Africa.
The Minister responsible for Small Businesses does not differentiate between East and West. He is perhaps misled by the translation, but there is obviously a difference! For instance, most successful economies in Black Africa apply
The Budget-Mr. Parry
socialist measures and policies. Moreover, the socialist Governments of Sweden, West Germany and France have brought prosperity and economic recovery to their own countries.


Stanley J. Hovdebo: Mr. Speaker, the Hon. Member will know that one of the key planks of the Conservative Party when it ran for election was its move to eliminate national debt and to reduce the deficit. In the three years that it has been in power it has managed to increase the national debt by 50 per cent to about $100 billion. It has decreased only marginally the deficit. Will the Hon. Member comment on this inadequacy in the operations of the Government?


John Edmund Parry: Mr. Speaker, I suppose we all stand to be judged somewhat harshly for our election commitments. Of course the Government must expect, being in the position it is in, that it will receive the harshest judgment. The fact is that during the election campaign the Conservative Party protested loud and long about the situation of the deficit that previous Liberal Governments had run up by, to use some common phrases, uncontrolled spending, spending like drunken sailors, or having let the economy get out of control. The fact is that for all its vaunted skills and commitment the Government has really made very little impression on the deficit.
Why has it made little impression on the deficit? I suggest it is partly because the commercial interests that brought the Government to power and which back it so powerfully did not feel that it was ultimately in their best interest to see the deficit reduced because, of course, they would have been the ones called upon to contribute to such a reduction. The fact is that the income tax situation which I outlined previously in my speech is obviously to the advantage of the corporate sector. While we hear great preaching from the corporate sector about the need for deficit reduction, as is characteristic in such cases, and individual taxpayers are not any different in this regard, there is very little volunteering done to reduce that sort of deficit.
Other matters I could mention deal with the unwise commitments that the Government has made to military spending, something that will not benefit Canada's defence and which, as we all know, will have a very limited impact on Canada's economy.


Raymond Garneau: Mr. Speaker, 1 would like to ask the Hon. Member what the position of the New Democratic Party is concerning flow-through shares. He will recall that a year or so ago the Hon. Member for Ottawa Centre (Mr. Cassidy), the finance critic for the NDP, said that he was against flowthrough shares. Later, the Leader of his Party went to Rouyn-Noranda and said something in support of flow-through shares. Today, another member of the NDP asked a question of the Minister of State for Finance (Mr. Hockin) in which it

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was suggested that he supported grants for mining development.
Representatives from different communities, mayors, chambers of commerce and prospectors will be in Ottawa next Tuesday wanting to know what the position of the NDP is concerning this matter.


John Edmund Parry: Mr. Speaker, I would like to thank the Hon. Member for Laval-des-Rapides (Mr. Garneau) for his very friendly question. As my Party's spokesman on mines I have indeed repeated the commitment of our Leader, the Hon. Member for Oshawa (Mr. Broadbent), to the continuation of incentives for mineral exploration. Flow-through shares have been a very successful measure in terms of promoting exploration.
I would not expect the Hon. Member to know this but in my riding there is the most active exploration area in the whole of Canada, particularly in terms of gold prospects.
The commitment of this Party is obviously to the continuation of progressive measures, particularly those that can be shown to benefit small and medium-sized Canadian-owned operations in mining exploration, whether that be by means of flow-through shares or another incentive combined with flowthrough shares. The Hon. Member for Laval-des-Rapides can rest assured that that will be continued under a New Democratic Government.


Mr. Deputy Speaker:: Resuming debate with the Hon. Member for Winnipeg-Fort Garry (Mr. Axworthy).


Lloyd Axworthy: Mr. Speaker, there was a time in the House when speeches on the Budget were an opportunity to examine a blueprint of economic and social priorities for the country. It was an opportunity for Governments to give an honest rendering of the financial accounts of the nation. At such a time they had to be forthcoming about prospects for growth and development. Most important, it was a time when they attempted to set out some series of goals and objectives that the Budget, the most important economic document of the country, would seek to implement.
One of the difficulties of engaging in this debate is that that is not what the Budget brought about. It was a masquerade, a camouflage, a subterfuge. It was cosmetic. The Minister of Finance (Mr. Wilson) is known as the "Mary Kay" of the political world. All he does is to put a lot of rouge and lipstick on the same old face. He does not provide Canadians with an opportunity to examine clearly the fiscal and economic direction of the country and what the Government will do about it. There was an attempt to present a picture of rosy, glossy, Pollyanna scenarios without providing the facts. When one examines that document it is disturbing to realize how much was hidden. There was a deliberate attempt to hide
within the Budget Papers the real story of economics in this country. Let me provide one example.
For the past two years we have been given the impression that the proposed trade initiative with the Americans was going to be the great cornucopia of economic growth and development. The Prime Minister (Mr. Mulroney) and the Minister of Finance promise you everything. You have a bald head, hair will grow; you have warts on your fingers, they will come off; all you have to do is to sign this agreement with the Americans. The Prime Minister goes to Calgary and says, "You see all those people driving BMWs in Toronto? Sign free trade with the Americans, and everybody in the West will have one too". This was going to be the magic wand that would open up all manner of incredible opportunities.
However, one need only look at the Government's own documents, which are not something that the Liberal Research Bureau has concocted. Let us look at the Department of Finance's own document, its own economic forecast as to the prospects under the trade agreement.
I think it is a fair assumption that the Department of Finance is on the same side as the Prime Minister. Perhaps in their hearts they are not, but as public servants they will be required to give the best case scenario. What was stated in the Department of Finance document, the Government's own estimate of what trade with the Americans will provide? Well, Mr. Speaker, hold on to your hat on this one. It stated that maybe, possibly, under the best case scenario, we may get one-half of one per cent growth per year. That is not even within the margin of error of the computer that does the forecasting. It is so small as to be meaningless in terms of an economic forecast.
The Minister of Finance rises in the House to the cheers of all his back-benchers and states that the Government will create 120,000 jobs. He did not say that those jobs would be spread over five years. That is 24,000 jobs a year. Last year, in the month of January, the Canadian economy created 60,000 jobs. We have been doing that for 10 years. In other words, the economic growth prospects provided by the Department itself are marginal. Not only that, but the Department of Finance forecast did not include two very important items, which we found out when we had to go through the Budget Papers. What they did not account for is that the Government of Canada will lose revenue as a result. In four or five years' time when the agreement is finally in place, it will mean $2 billion a year of lost revenue. Even in this year there was a very interesting little table in the fiscal plan which stated that lost revenue due to trade initiative amounted to $450 million, and increased taxation on gas was $475 million.
In other words, every time a Canadian taxpayer fills up his or her car with 30 or 40 litres of gas, he or she will be paying a lot of money for "Brian's folly". The Department of Finance did not include the fact that there was going to be increased taxation on Canadian consumers to pay for the trade initiative. It is $.5 billion this year, $1 billion the next year, and finally
February 26, 1988

$2 billion a year. That wipes out that one-half of one per cent growth per year.
Furthermore, the Government includes absolutely no forecast in its analysis as to the cost of adjustment. It pretends that that will not be a problem. Industry after industry has come forward and stated that there will be major job loss. Someone will have to pay additional UI premiums. Someone will have to pay for additional training. Someone will have to pay for new industries in the community that will be devastated by the loss of its textile plant, food processing plant, or its printing industry. Who will pay for that? The federal Government has stated that it will not pay for it. The provinces or the private sector will pay for it. The Macdonald Royal Commission has stated that that could be a $5 billion tab.
Try these mathematics, Mr. Speaker. The Government states that there will be one-half of one per cent of growth. If one subtracts $2 billion in additional taxes and $5 billion in adjustment costs, not only is the additional growth wiped out but there is a negative account.
Last Monday in Fredericton Mr. Archer McLean appeared before the federal Liberal task force. He is a vice-president of McCain Foods, the largest food processor in Canada. There are 1.7 million Canadians who work in the agro-food business. Mr. McLean appeared before the task force and stated that his company has a choice under the free trade agreement; it either shuts down or goes south. That is his choice. I have it here, and I will gladly table the document. Mr. McLean stated that the agro-food business, the people who put the cornflakes in the box, the tomato catsup, the frozen foods, or the chicken pot-pie, which is a big industry in Canada, cannot survive under this free trade agreement.
If the Government is being honest, they will be required to pay higher input costs for the tomatoes, the potatoes, the chickens, the asparagus, the broccoli, and all the foodstuffs used. As Mr. McLean properly pointed out, the trade agreement forgets a couple of important ingredients. One, Canada has a winter that sometimes lasts six to eight months. Therefore, if a company has to compete on the so-called level playing field with chickens that are grown in Georgia, where a little hut is built and some corn is thrown on the ground, and that is all that has to be provided, compared to chickens that are grown in New Brunswick, Manitoba, or British Columbia where the buildings have to be heated and many other input costs have to be provided, they say that they cannot compete. They say that they have a choice of getting rid of supply management, put import quotas on, which is not free trade, or they will move south.
There is an interesting example in my own province provided by Mr. McLean. There is a large plant in Portage La Prairie where 300 or 400 people work. They make French-fried potatoes from good Manitoba potatoes. They pay $120 per tonne for potatoes in Manitoba. That same tonne of potatoes is available down south for $90 a tonne because of the difference in climate and geography. It has nothing to do with the
The Budget-Mr. Axworthy
creative ability of the Canadian farmer, his sense of confidence or entrepreneurship. All it says is that he has to grow potatoes in a cold climate. Therefore, there are higher input costs.
The Government of Canada has taken none of that into account. It is putting at risk the largest industry in Canada. Where is that contained in the Minister of Finance's forecast? Where is his analysis of how we will compensate that industry or the workers who will lose their jobs? It is nowhere to be found. The economic forecast provided by the Minister of Finance in his statement is phoney. It is a con job, it is a snow job, it is has no basis in reality or in fact.
I did not mention the printing industry which will lose
10,000	jobs, or the textile or garment industry which has been promised that it will not be injured by this trade arrangement.
[Translation)
The largest industrial sector in Quebec is the textile and clothing industry. This sector would certainly be substantially weakened by the Free Trade Agreement.

Yet the Government makes no provision. It states that it will not do anything about it. Yet it knows that someone will have to pay the tab.
Let us look at the analysis on the economic side. The Government is hiding the facts. It is concealing the truth. It is relying on its propaganda machine rather than on its ability to present an effective argument. That is not right. Canadians should expect more from the Government. They should expect honesty and truth from their Governments, otherwise how can they prepare themselves and know what they are getting into?
Let me provide another example of the way in which the Budget is cosmetic. The Minister of Finance promised new initiatives in the regions to help them regain their economic balance, one of the primary responsibilities of any Government. He promised the great Western Diversification Fund. However, when we look at the Estimates we find that the money being spent on western diversification is under old programs, that certain provinces do not receive any money at all, and that in my own Province of Manitoba they are hauling out jobs. Some 300 jobs in the CNR will disappear, but the Minister of Transport says "Oh, I am sorry, that is downsizing". So we have this interesting contradiction-we have a Western Diversification Fund with no allocation. They have not got around to it yet because they have not completed the organizational principles. They are taking money under existing regional development programs, transferring it out of my province to go elsewhere, and reducing jobs in federal Crown corporations. That is the Tory formula for regional development. They take away money, take away jobs, and leave us with a lot of propaganda and promises; hardly a basis upon which to build confidence.

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Let me give another most fascinating example by returning to the trade agreement for a moment. The Government of Canada says: "We want to be world traders", but we know from an analysis that it is really preoccupied with Canada-U.S. trade. I would be most happy if a Member on the government benches would answer the following question: If the Government is anxious to encourage trade around the world, why is it that it has reduced the budget expenditure on trade development by $11 million in the last year? Why is it cutting back? It has cut back on export financing every year. Is it any wonder that our trade with the Pacific Rim is down by 30 per cent? Is it any wonder that our trade with Europe is down by 20 per cent? Is it any wonder that our trade with the Middle East is down by 30 per cent? It is because this is a Government which does not want to trade with the world. It wants to trade only in Akron, Ohio, or some other such place. It is deliberately neglecting its responsibility to the Canadian business sector to provide the export financing, the development work, and the embassies and consulates necessary to open new trade opportunities. That is the real agenda. It is not interested in trading around the world. It has no interest in supporting such trade diversification for Canadian industry.
Can we believe a Government which is going to spend $11 billion on nuclear submarines but is cutting back millions of dollars on trade development? What kind of a perverted sense of priority is that? What kind of rank stupidity is it when the Government is going to build submarines to satisfy the adolescent aspirations of the Minister of National Defence (Mr. Beatty) who was frustrated because he did not have enough submarines in his bath tub as a young boy and as a result cut back expenditures on broadening our trade position around the world?


Mr. Thacker:: Shame on you, Lloyd.


Lloyd Axworthy: I have no shame about that. The only people who should have shame are those who are engaging in a gross militaristic expenditure at the sacrifice of our trade development in the Pacific Rim, in Latin America, and in Europe, and who are sacrificing small businesses that need export financing support to open up new markets, for the sake of an adolescent fantasy of cold war brinksmanship that the Minister of National Defence tries to peddle around the country.
Let us deal with another question on which the Government has been totally silent. The other day when 1 was in my riding in Winnipeg, I met with a group of social workers and street workers to talk about the problem of the homeless in downtown Winnipeg. We have 5,000 homeless kids in downtown Winnipeg. Many of them are engaged in street prostitution. Many of them are running from home to home. Many of them do not have the kind of support they need. There are 5,000 homeless kids, to say nothing about families.
However, if I turn to the Estimates I find that the Government is cutting back job-creation programs dealing with low income people. It is cutting back its expenditures. Also,
CMHC is no longer providing financing to housing for special needs. Grants are being cut back to the social agencies, and organizations working with native groups. In other words, at a time when we are facing one of the most debilitating and heart-wrenching social problems of a generation, the Government says "no", is indifferent to the problem, and is paying no attention. It cannot be heard.


Raymond Garneau: What about International Year of the Homeless?


Lloyd Axworthy: Yes. We had International Year of the Homeless, as my colleague reminded me. Where are the programs which came out of it? There were conferences, studies, reports, and research, but no direct delivery. Those
5,000	homeless kids-and the numbers are growing-did not see any of that money. In fact, I will give an example. The Government announced a few years back that it would spend $5 million to try to do something about battered and abused women and children as a result of the Badgeley report.
I went through the figures. All the money that has been spent to date went on conferences, seminars, and training programs, with the exception of one project in Vancouver that actually provided direct delivery to the children themselves; one of the whole group.
I only use that example to say that the Government does not have its priorities straight. It has no social programs. It has no sense of what is happening out there on the streets. It is abandoning those people. It is cutting back on its support in critical areas.
There are Members of the House who have stood and defended the so-called Canadian Jobs Strategy program as being a great accomplishment. What that program has done is taken money away from those very groups. They say that they are going to train for the labour market, which means that they are not training those children who left school in grade seven or grade eight and do not have the proper literacy to enter a training program. They do not give money to social organizations such as children's homes or Rossbrook House in downtown Winnipeg which used to use those programs to take native kids off the street and give them some initial experience in the job market. Oh, it was not fancy training on computers, but it sure made a difference. It gave them a step up and a sense of hope. All that has disappeared, and now we are left with a problem which is growing by leaps and bounds, and we have a Budget which says absolutely nothing about it.
What we say is that this is not a Budget. It is an attempt to fool and con the Canadian people. It is a blueprint for discrimination. It is a blueprint of bias. It is a blueprint that has no feeling or compassion.
This is why Canadians, when they begin to learn what is in the Budget and see the reality behind it, will make their judgment, as they are already making it, that this is a Government which no longer has the right to govern.
February 26, 1988


Nelson Andrew Riis: 1 have a question for my hon. colleague, Mr. Speaker. I listened with interest to a speech on priorities in which the Hon. Member said that priorities seem to be skewed with this Government and the Member laid out a whole number of reasons why he felt that.
I want to ask him about another priority, namely, we appreciate as Members of this House that the mining industry is one of the major industries of Canada. It is a multibillion dollar industry employing tens of thousands of people in every region and every province. One of the initiatives that Governments have taken in the past has been a mechanism called flow-through shares. This mechanism allowed mining companies to raise funds for exploration. If you like, the first stage of any mine development has to be to find the mineral deposit and explore it. We know now that the Government has decided to phase out for all intents and purposes that flow-through program which, in a sense, leaves the mining sector high and dry, particularly the small and medium-sized junior companies which are exclusively Canadian owned.
Could the Hon. Member for Winnipeg-Fort Garry (Mr. Axworthy) say whether this too would be part of his litany where the Government has missed the point in its priorities by abandoning support for exploration at the front end of the upstream of mining development in Canada? Will that have serious implications on the ability of Canada to develop this critical sector in the future?


Lloyd Axworthy: Mr. Speaker, I thank the Hon. Member for Kamloops-Shuswap (Mr. Riis) for his question. When I was in British Columbia seven or eight months ago meeting with the mining associations it was very clear that the flow-through share program was one of the most important regional development programs in the country. It was a program that not only had a specific set approach but also had a number of corollary benefits for the communities and the regions. The Member himself knows from the constituency he represents that many small communities are totally dependent upon the mines. If the exploration and development is cut back, reduced or eliminated, then the communities themselves suffer.
We had commitments from the Government that it would do something for the mining industry. The flow-through share program was removed and the Government said it would replace that with something, but, as we know, the Government takes off one shoe and never lets the other one drop. So we have the abandonment of the flow-through share formula but nothing to replace it. I have had several representations from the mining industry in my own province that this situation is creating a climate of uncertainty which means there will be a cut-back on investment and expenditure. It will also have harmful effects on many of the small one-industry mining towns which are very important in western Canada. Once again we have a Government that has blinded itself to reality as to what works well and what it should be doing to keep a regional balance in Canada.
The Budget-Mr. Axworthy


Steven W. Langdon: Mr. Speaker, 1 would like to put a genuine question to my friend from Winnipeg-Fort Garry. I have had some concern and, frankly, some surprise in my mind since reading the comments after the policy conference in Vancouver on the question of the trade deal with the United States. I know that in his speech the Member made a very strong condemnation of the potential effects of this trade deal, one that I share completely. I would like a reaffirmation from the Hon. Member for Winnipeg-Fort Garry (Mr. Axworthy) as to the Liberal commitment on this trade deal.
If a new Government is elected, a non-Conservative Government, a Government which includes or is made up of Liberals, will that Government take a decision to see to it that the trade deal as it stands, as an agreement, is not put into effect but is instead replaced by a series of individual initiatives to improve our trade with the United States, as opposed to this blanket, across-the-board deal and what I think we both feel has been so devastatingly dangerous, a deal for Canada which has led to so many surrenders for this country?


Lloyd Axworthy: Mr. Speaker, I am glad to answer the question. Perhaps the Hon. Member who referred to the policy conference in Vancouver would be interested in a speech given by the Leader of our Party. May I just take a moment to quote from it. He said:
I oppose the Mulroney trade deal because in integrating our economy and
society more closely with that of the United States we are dramatically
reducing our ability to make our own choices for our own future.
I think it states very clearly the position of the Leader of our Party and it is a position supported by the caucus of our Party. We are determined that this is a deal, an arrangement, that is not in the interests of Canada and would have to be abrogated.
I point out to the House, and I do respond to the sincerity of the question with an equally sincere answer, that when we were in Washington a week ago as part of a fact finding mission to determine American attitudes about the deal, it was clear to me that it would be far more difficult to abrogate a treaty after it is ratified at the end of the year than if we were to do it now. The Americans would not find it particularly difficult or problematic if Canada, through its democratic process, decided that it did not want to go ahead with the deal. It would be more complicated if after ratification and the treaty or the agreement was signed and the abrogation had to be used, it could cause a reaction. That is why I think it is absolutely morally responsible for the Prime Minister (Mr. Mulroney) to call an election before that ratification so as to give Canadians the right to decide on this issue, among others, before we put ourselves into the situation where Americans might have more justification for reaction.
I am not saying that we would pull back from that reaction. I am just saying it would be more difficult. If the Conservatives really believe and have the strength of their convictions, which I sometimes wonder if they do, then let them put it to the test and not put a future Government in a position of having to abrogate a treaty. Have an election before the

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agreement is ratified. If the Conservative Party wins, then fine, the Conservatives will have a clear mandate and they can go ahead and ratify in all good conscience. If they lose, they will not be putting a future Government into a difficult position. That, I think, should be a clear recognition on the part of the Prime Minister. If he had any sense of responsibility or obligation through the democratic process, that is what he would do.


Raymond Garneau: Mr. Speaker, the Hon. Member for Winnipeg-Fort Garry (Mr. Axworthy) in the early part of his speech referred to the document prepared by the Minister of Finance (Mr. Wilson) concerning job creation if the trade agreement was put into effect. My colleague referred to the tax increases to replace the duty removal that will be the result of this deal.
Could the Member tell me if in this report of the Department of Finance the Department took into consideration the changes in the value of the dollar? Was the assumption that the dollar would remain at 74 or 73 cents? As of this morning it was at 79 cents, and this increased value of the Canadian dollar could wipe out completely the benefit of the duty removal. I would like the Member's comment about this aspect of the Department of Finance's report on job creation.


Lloyd Axworthy: Mr. Speaker, I will provide a very quick and concise answer. First, it is very clear, almost axiomatic, that if this agreement goes ahead, there will be an increasingly upward valuation on the Canadian dollar. That is the expectation of the Americans and it has been the case historically when such agreements have been signed. There will be new institutional pressures to bring that about. We can make the assumption that the dollar will be much higher than 79 cents after ratification.
There has been no consideration whatsoever in the Department of Finance report that the value of the dollar is a factor that should be taken into account. If the value of the dollar were to change by another three or four cents, it would totally wipe out any proposed benefits under the forecast provided.
I will just say as a footnote, Mr. Speaker, because I know that you are deeply interested in these matters, that I met yesterday with people in the softwood lumber industry who pointed out that they have already been severely affected by the change in the value of the dollar from 75 cents to 79 cents. They are already losing markets and are already on the margins of production for small and medium-sized sawmills on the West Coast, in Quebec and in Ontario. Already the promises we have had from the Government that somehow the dollar was a fixed item have been proven wrong in a very vital sector of the industry. My colleague is absolutely correct. The Department of Finance took no consideration of that.
The Department did not consider the cost of adjustment nor did it consider the cost of increased taxes or the cost of the dollar. If all that had been taken into consideration in an
honest forecast, we would probably have a negative report, not a positive one.


Stanley J. Hovdebo: Mr. Speaker, 1 appreciate the opportunity to speak on the Budget. When the Minister of Finance made his Budget Speech, he used a format which to some extent has been followed by other Hon. Members who have spoken. When he spoke, he reported on his term of office. On some occasions, it was a somewhat biased report, but it was a report on that period of time. Over the days of the budget debate, government Members who have risen have followed that format. They have repeated ad nauseam the same liturgy, attempting to convince the people of Canada by repetition that the Government has done something worthwhile in the last three or four years.
Since the Minister has established that format, I am sure he will not object to our use of it. I will use at least part of my 20 minutes, therefore, to report on the record of the Government and on the effect of the Minister's Budget on the people of Canada.
This particular Budget contained very little. I suppose that this is part of the reason for the Minister having used the format he did. He really did not feel that he could spend the half hour or so he thought was necessary talking about the new deal he was presenting to Canada. Therefore, he made a rather lengthy attempt to put the past in the best light possible.
The Budget will have very little impact on Canadians across the board. What becomes important in the Budget is what the Government is attempting to make the central issue in this debate. The Budget does nothing to improve Canada for Canadians. The Budget contained a few things that will impact negatively, particularly taxes, and it even contains some retreats from positions the Government had taken previously. However, there is nothing to make the life of Canadians better than it was before 1984 when this Government was elected.
The record of the Minister of Finance in agriculture has not been impressive over the years. He started out early in his career by presenting to Parliament and the people of Canada a paper entitled Finances in Agriculture. I believe it was presented late in 1984 or early in 1985. The main point of that paper was that the farming sector was obviously the richest sector in the economy and that farmers were getting much more out of the economy than they should. That was two years ago, and that was when the recession in agriculture began.
At that time, even the Minister's colleagues in the Conservative Party were embarrassed by the lack of knowledge and understanding expressed by that paper. The Minister withdrew from the ideas in that paper rather hurriedly and buried his head for a while. Rather than getting good advice on agriculture, his next incursion into the agricultural industry was to remove the investment tax credit on new machinery. He, along with his colleague in revenue, began to investigate how producers had benefited from the investment tax credit.
February 26, 1988

We recognize that the agricultural industry is not doing particularly well at this time. The Minister's initiative kind of put the boot to the industry when it was down. At a time when a great many farmers were suffering, they suddenly found themselves being investigated for doing their part in helping the machinery industry.
The investment tax credit for new machinery was put in place to increase the movement of machinery from the manufacturer to the farm by giving some assistance to the farmer. This was of great assistance to the farm-machinery manufacturing industry. The provision was not put in place originally to help the farmer, although farmers did receive some benefit from it. It was intended to increase the sale of farm machinery, and it did just that.
The Government proceeded to remove that measure and to assess farmers who had made use of it. It was a kind of harassment which caused a great deal of concern and heartache among farmers who were already in a bad situation. Again, the Government retreated in somewhat of a fluster. I must say that, for a while at least, the harassment stopped. The Government decided that its approach to this withdrawal was doing it some political harm and it withdrew. Now, however, many farmers are telling me that they are again being assessed and are required to produce rebates on matters into which they themselves had very little input. It is the kind of discrimination that gives all Governments a bad name. After the Government committed itself not to proceed with investigation and harassment of farmers who had taken advantage of the investment tax credit, it is now proceeding to do so. It flip-flopped twice on that issue.
Another incursion into the agricultural industry was the Minister's White Paper on taxation presented last June. In that paper the Minister attempted to impose accrual accounting on all farmers. With a certain amount of relief, farmers are seeing one further retreat by the Minister in this Budget, but he did not solve the problem. He left farmers in limbo. He says he is going to take his accounting and tax procedures to hearings across the country and then come down with something somewhere between cash and accrual accounting. Right now farmers do not really know what to expect. They can carry on what they have been doing for at least another year, but they have not been told whether they will be faced with accrual accounting in the future.
The Minister's inadequacy or absolute lack of knowledge of agriculture almost makes you want to take him out West and say to him: Now, Mr. Minister, this is a cow. This is a quarter section of land, 160 acres. It is part of a section which is a mile each way, one square mile or 640 acres. Those kinds of things are basic to agriculture and the Minister should know them, but he apparently does not because he does not take the kind of action which will allow farmers to continue to operate. It appears that he does not know the effect of the decisions he
The Budget-Mr. Hovdebo
and his Department have made in the past concerning the farm industry.
When you look at the rest of the Budget, you realize the Minister lives in some kind of a fantasyland which must be based on Bay Street. He does not deal with reality. His is a financial world which has very little connection to the actual world of day-to-day labour and production.
For example, the Minister tells us loud and long in his speech about the reduction in income taxes for ordinary Canadians. He says they will receive an average reduction of S400. Yet he neglects or overlooks or fails to tell the people of Canada that since 1984 the Government has added $1,400 to their taxes. The average family is paying $1,400 more in taxes now than it was three years ago. Yet the Minister stresses the fact that you might get $400 back, even though you are out of pocket by $1,000. This is not something for rejoicing, nor is it a particularly realistic or honest approach.
I can give another example. The Minister suggests the Government has created one million jobs. Using the Government's method of counting he says they can prove it. Yet he ignores the fact that about half those jobs are part-time and that in eight of the 10 provinces the unemployment level has not changed significantly.
Another example. Even as the Minister proclaims fairness in taxation for all people, he adds another five cents a gallon to the price of gasoline as of April 1. That makes for a total increase in the cost of gasoline of approximately $350 more than it was in 1983. Since many workers, even those in fairly low-paying jobs, cannot avoid using their cars, this is a regressive tax. The people who can least afford to pay it and who are required to use their cars must pay it. It comes off the top of their earnings before they spend money to live, pay rent and buy food.
A further example. After great huffing and puffing by the Prime Minister (Mr. Mulroney) about the increase in research and the need to double spending in that area, we have a recognition of specific funds in the Budget for research. Research happens only if you plan and train for it. The Government has systematically reduced the funds available for higher education. Places like the University of Saskatchewan, in my province, which is one of the most active and highly respected agricultural research centres in Canada, are not being adequately funded to train scientists let alone carry out the research necessary in that area.
I am sure that if you took any particular sector of the economy you would find exactly the same thing. By reducing the number of scientists or the amount of money going to training and research facilities, the Government is effectively reducing the amount of research being done in Canada. We are tenth among the OECD countries in the amount of money we spend on research. We are short of scientists and we are not giving universities enough money to produce scientists. We are

February 26, 1988
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not taking advantage of the opportunities available in technological development. Again, the Minister is living in a fantasy-land or in Bay Street finance land rather than in the world of development.
The Minister spends much time spouting about fairness, but his projected taxation structure is anything but fair. To most of us, fairness in taxation means that those most able to pay should pay a higher percentage than those in the lower income tax brackets. Since 1984 corporation taxes have risen by 28 per cent, yet personal income taxes have risen by 55 per cent. Sales taxes which everyone in Canada pays when buying anything have risen by 96 per cent. There are still 60,000 profitable corporations which pay no taxes at all. The Minister did not even suggest a minimum tax so that all corporations would contribute to running this country.
The Minister has not moved on reduction of the deficit. In the three and a half years during which the Government has been in power it has added $100 billion to the national debt and has only marginally reduced the speed at which the debt increases each year. I can go on. There are 200,000 child care spaces required and no effective money to solve the problem. There is only marginal money available to proceed on regional development.
We are studying the effect of this Budget on Canada. Free trade is not the answer. That is the road to Americanization and America is not the model toward which most of us want to move. Joining the United States is not a new deal for Canadians. During the rest of the Government's term I hope it will bring to the people of Canada a new deal which recognizes that we need improvement and the development of Canada.


Alan Redway: Mr. Speaker, I have great respect for the Hon. Member who just spoke. I served with him on the Public Accounts Committee and I regard him highly. However, I must say that I found his remarks today to be basically bumf.
He referred to the issue of personal income tax and the amount of income tax paid by individuals as opposed to corporations. The Hon. Member did not point out that while the amount raised by personal income tax has increased very substantially in the last three and a half years, 80 per cent of that increase is as a result of the fact that people have been put back to work. People who were not working are now working and earning money again and are, therefore, paying taxes. The Hon. Member did not point that out in his comments.
The Member also spoke about the deficit and deficit reduction. The Member indicated that there had been only marginal deficit reduction over the last three and a half years. You and I are aware, Mr. Speaker, that the annual deficit has been reduced over that three and one-half short years by $10 billion. The other day an Hon. Member suggested that "billion" should be spelled with a capital B, and that is right. There has been $10 billion annually spent on deficit reduction.
If the Member believes that deficit reduction should take place at a much more substantial rate, would he increase personal income taxes or other taxes, a move which he and his Party have opposed consistently over the last three and a half years and forever before that, or would he cut government expenditures, a move which he and his Party have opposed over the last three and a half years and long before? They have indeed consistently requested that government spending be increased over that period of time. How would the Hon. Member reduce the deficit-by cutting expenditures or by raising taxes?


Stanley J. Hovdebo: Mr. Speaker, I would like to thank the Hon. Member for the question. He is using exactly the same logic in commenting on my speech as the Government is using across the board. The Member suggests that the deficit has been reduced by $10 billion. That may be so, but in the process of doing so the Government has increased the debt of Canada by $100 billion.
The Government shows the same kind of logic in dealing with employment. One million jobs have been created, but each of the provinces has the same percentage of unemployment as they had before and the number of part-time jobs has increased. Half of the one million jobs were part-time jobs.
The Member asks how we would reduce the deficit. We certainly would not do it by signing a trade agreement with the United States because the effective result of that will be the reduction of jobs. We need to put in place a policy of full employment which will require domestic investment. Every $1 billion of profit in a Canadian corporation produces close to
5,000	jobs. For every $1 billion of foreign profit 16 jobs are created and most of the profit goes to the foreign country.
If we really want to get rid of the deficit we must put everyone to work, whereupon taxation will increase to the extent that the deficit will become less and less of a factor.


Don Boudria: Mr. Speaker, I want to ask a question of the Hon. Member and I am sorry that it may not be as complimentary to the Conservatives as my questions usually are. The Hon. Member for Prince Albert (Mr. Hovdebo) is a very wise Member. Does he know that since the Conservatives came into power in 1984 a family of four with one earner earning $32,000 a year pays $1,200 per year more in income taxes than it did the day prior to the Government coming into office? I would like the Member to tell us what he thinks of that particular government initiative.
I would also like to ask the Member about tax on long distance phone rates, the tax on free speech as I call it. That 10 per cent tax on telephone rates unfairly discriminates against rural Canadians. I know the Member has a number of rural constituents because I had the honour and pleasure of visiting the Hon. Member's riding last year. He was kind enough to greet me when I went there. He and I both represent rural ridings.
February 26, 1988

Would the Member not agree with me that that tax which will generate $870 million this year is totally reprehensible and discriminatory against rural Canadians and small businessmen, the same small businessmen whom the Tories pretend to represent?


Stanley J. Hovdebo: Mr. Speaker, the first part of the question regarding the income and taxation of the average family is a matter of record. Taxation has increased by $1,300 or $1,400 and the reduction will only be about $400 if it goes through in the way the Minister suggests.
With regard to the 10 per cent tax on telephone calls, there are communities in my constituency where every call made is a long distance call. If people want to call their doctor, their children's school, or call for any equipment or supplies, they have to make a long distance call. Small businesses in such communities are bearing the burden of the major increases in the tax on telephone calls. There is no doubt in my mind or in the mind of anyone in rural areas that the 10 per cent tax on telephone calls is very discriminatory.
It affects people in rural areas much more than it affects any city dweller.


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


Some Hon. Members:: Question.


Mr. Deputy Speaker:: Mr. Wilson (Etobicoke Centre), seconded by Mr. Lewis, moved:
That this House approves in general the budgetary policy of the Government.
The Budget-Mr. Hovdebo
Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


Mr. Deputy Speaker:: All those in favour of the motion will please say yea.


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


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


Mr. Deputy Speaker:: Pursuant to Standing Order 13(5), the division is differed to Monday, February 29, 1988, at 6 o'clock.


Douglas Grinslade Lewis: Mr. Speaker, there have been discussions among the Parties and 1 think you will find there is unanimous consent to call it three o'clock.


Mr. Deputy Speaker:: Is there unanimous consent to call it three o'clock?


Some Hon. Members:: Agreed.


Mr. Deputy Speaker:: Therefore, the House stands adjourned until Monday at 11 a.m.


[Stage Direction]
The House adjourned at 1.41 p.m.
[Stage Direction]

Monday, February 29, 1988
[Stage Direction]
Prayers