1989-10-10

Mr. Speaker:: I am now ready to rule on the question of privilege which was raised on September 25 by the Right Hon. Leader of the Opposition concerning the government advertisements which appeared in newspapers on August 26 relating to the proposed goods and services tax.
From the very outset, I wish to state emphatically that the Chair has no intention of dealing with the relative merits or limitations of the proposed tax; the Chair has absolutely no role to play in such political matters. The Chair's sole responsibility in this instance is to determine whether the matter raised by the Leader of the Opposition warrants setting aside the regular business of the House.
Citation 84(2) of Beauchesne's Rules and Forms of the House of Commons, fifth edition states:
It has often been laid down that the Speaker's function in ruling on a claim of breach of privilege is limited to deciding the formal question, whether the case conforms with the conditions which alone entitle it to take precedence over the notices of motions and Orders of the Day standing on the Order Paper; and does not extend to deciding the question of substance, whether a breach of privilege has in fact been committed -a question which can only be decided by the House itself.

I want to again stress that the Speaker does not rule on whether a breach of privilege or a contempt has in fact been committed. The Speaker only determines whether an application based on a claim of contempt or breach of privilege is, on first impression, of sufficient importance
to set aside the regular business of the House and go forward for a decision by the House. That is the narrow point that the Chair must decide.

It might be appropriate to first review some of the facts surrounding the present case. On August 26, 1989, the Department of Finance published in newspapers across the country an advertisement which stated:
On January 1, 1991, Canada's Federal Sales Tax System will change. Please save this notice. It explains the changes and the reasons for them.
I point out that this ad was a full-page ad and the letters were very large indeed.
Let me repeat the wording of the advertisement in French.
Le ler janvier 1991, le regime de la taxe federate de vente connaitra des modifications. Veuillez conserver cet avis. II explique les modifications apportees et les raisons qui y president.
I should point out that in French, then, the ad went perhaps even farther than what was implied in the English.
The advertisement went on to explain that the goods and services tax "will replace the existing federal sales tax" and it outlined very specific proposed changes. It is true that in the ad some of those changes were set out under the heading "Proposed Changes".
In the interventions on September 25, the Hon. Member for Parkdale-High Park pointed out that these ads also appeared in many ethnocultural newspapers across Canada. At the invitation of the hon. member I examined a number of the newspapers in question, and found that most of these advertisements were published in early September, and that some of them were printed in Italian and Lithuanian.
The Hon. Member for Ottawa-Vanier, in his intervention, laid stress on the fact that, in the French text, the wording of the advertisement suggests that the changes have already been made or adopted in so much

October 10, 1989
Privilege
that the ad uses a "participe passe" namely the word "adoptes".
In presenting his case for a breach of privilege, the Leader of the Opposition dealt with a number of serious issues. If I may be permitted to summarize his arguments, he makes two basic claims: first, that the advertisement prejudices the future proceedings of the House and of the finance committee which has undertaken an examination of a technical paper on the subject; and second, that the advertisement is a contempt of Parliament because it leaves readers to infer that the House has no role in the passage of the tax, thus misleading the Canadian public concerning the procedures employed by Parliament in adopting such legislation. To quote from the right hon. member at pages 3809-10 of Hansard:
The wording "Please Save This Notice", followed by chapter and verse of the alleged tax changes, constitutes a basis for a question of privilege.
At least this is the argument of the Right Hon. Leader of the Opposition. He continued:
Those words "Please Save This Notice" constitute a contempt of Parliament, constitute an intimidation of Parliament, because the only inference to be drawn from the words "Please Save This Notice" is that it does not matter what members of Parliament do in dealing with these taxes. It does not matter what the committee on finance does with respect these taxes.
He goes on to argue:
These advertisements violate our parliamentary tradition in two more ways. They prejudice the proceedings that are now before the Standing Committee on Finance as well as prejudicing future proceedings of the House itself.
The hon. member for Oshawa and Leader of the New Democratic Party spoke in support of the claims made by the Leader of the Opposition. In addition, he raised the issue of the propriety of a government using public funds to advertise its position on a debate which has yet to be held in Parliament. On this specific point, I would like to immediately refer to the ruling of Speaker Sauve on October 17, 1980, at page 3781 of Hansard and I quote:

"The fact that certain members feel they are disadvantaged by not having the same funds to advertise as does the government, which could possibly be a point of debate, as a matter of impropriety or
under any other heading, does not constitute a prima facie case of
privilege - "
I feel, just as Speaker Sauve concluded, that this is an important issue which merits consideration, but it should not take place under the aegis of privilege.

To continue with the arguments presented to the Chair on the question of privilege, the Minister of Justice rose to make three basic points for rejecting this application as a breach of privilege or contempt of the House. He referred to the fact that the finance committee itself unanimously recommended that if the government were to proceed with the value-added tax it should publicize the details of that tax. He also explained that in the budget which was approved by the House, the government had indicated that the goods and services tax would be implemented on January 1, 1991. Finally, since the committee is presently studying the issue, he suggested that no case can be made for the claim that the committee's work is being impeded.
The Chair has also considered the arguments made by the hon. member for Windsor West, the hon. member for Kamloops and the hon. member for Peace River, and I would like to thank them for their interventions in this serious matter.

In the present case, the Chair must address a number of issues. I intend to first deal with the issue of whether or not there has been a breach of privilege insofar as the advertisement prejudices the work of the House or the Committee. I will then deal with the claim that the advertisement is a contempt of Parliament because it infers that the House does not have any role to play in the passage of the tax, and that it misrepresents to the Canadian public the procedures employed by Parliament in adopting legislation.

Before proceeding with the first issue, the Chair feels it might be useful to offer members a short explanation of the difference between what constitutes a contempt of the House and what constitutes a breach of privilege.
The privileges extended to members individually and to the House as a collectivity are finite. They are generally categorized under five headings which are: freedom of speech, freedom from arrest in civil actions, exemptions from jury duty, exemption from attendance
October 10, 1989

as a witness, and freedom from molestation. As Erskine May explains on pages 70 and 71 of the twentieth edition:
The distinctive mark of a privilege is its ancillary character. The privileges of Parliament are rights which are "absolutely necessary for the due execution of its powers". They are enjoyed by individual Members, because the House cannot perform its functions without unimpeded use of the services of its Members; and by each House for the protection of its Members and the vindication of its own authority and dignity.
As a result, when members claim that a certain action constitutes a breach of privilege, they must specify which privilege is affected.
Contempts, on the other hand, cannot be enumerated or categorized. As Speaker Sauve explained in a ruling on October 29, 1980, at page 4214 of Hansard:
-while our privileges are defined, contempt of the House has no limits. When new ways are found to interfere with our proceedings, so too will the House, in appropriate cases, be able to find that a contempt of the House has occurred.
Broadly speaking, contempts are offences against the authority or the dignity of the House of Commons. They include situations which cannot specifically be claimed as breaches of the privileges of the House. As noted at pages 71 and 143 of Erskine May's twentieth edition:
Each House also claims the right to punish actions, which, while not breaches of any specific privilege, are offences against its authority or dignity, such as disobedience to its legitimate commands or libels upon itself, its officers or its Members. Such actions, though often called "breaches of privilege", are more properly distinguished as "contempts".
It goes on:
It would be vain to attempt an enumeration of every act which might be construed into a contempt, the power to punish for contempt being in its nature discretionary-. It may be stated generally that any act or omission which obstructs or impedes either House of Parliament in the performance of its functions, or which obstructs or impedes any Member or officer of such House in the discharge of his duty, or which has a tendency, directly or indirectly, produce such results may be treated as a contempt even though there is no precedent of the offence.
As already mentioned, it is not possible to categorize or to delineate what may fall under the definition of a contempt. It is not even possible to categorize the "severity" of a contempt. As a procedural authority on the Lok Sabha of India, that is the Indian Parliament,
Privilege
explains in Practice and Procedure of Parliament at page 209:
Contempts of Parliament may, however, vary greatly in their nature and their gravity. At one extreme they may consist in little more than vulgar and irresponsible abuse; at the other they may constitute grave attacks undermining the very institution of Parliament itself.
In summary, all breaches of privileges are contempts of the House, but not all contempts are necessarily breaches of privilege. A contempt may be an act or an omission; it does not have to actually obstruct or impede the House or a member, it merely has to have the tendency to produce such results. Matters ranging from minor breaches of decorum to grave attacks against the authority of Parliament may be considered as contempts.

In the present case, the Leader of the Opposition (Mr. Turner) contends that the advertisement by the Department of Finance prejudices the future proceedings of the House and the Finance Committee.
The Chair must determine which of the specific privileges of the House have been breached.

Certainly, freedom of speech has not been affected. The committee is continuing its deliberations and the House will no doubt be debating the several issues surrounding the proposed goods and services tax, either through Question Period or on the report of the finance committee which will be presented to the House no later than November 28, 1989. The House will also have the opportunity to debate any bills that the government may propose to the House and will also have an opportunity to vote on any Ways and Means motions, which necessarily precede the introduction of any such bills. The opportunity for debate and amendment are too numerous to list. Suffice it to say that those opportunities have not been diminished.
Now, has the House or have any Members been obstructed in the performance of their duties? In order for an obstruction to take place, there would have had to be some action which prevented the House or Members from attending to their duties, or which cast such serious

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Privilege
reflections on a Member that he or she was not able to fulfill his or her responsibilities. I would submit that this is not the case in the present situation.
I would also like to point out that the House and its committees do not work in a vacuum. Members are constantly aware of outside factors and pressures. Since no threats or bribes have been made, it is difficult to see how the work of the House or the Finance Committee has been prejudiced or which specific privilege has been breached.
On this issue, I cannot find that any privilege has been breached.

In the present case, does the advertisement of the Department of Finance amount to a contempt of the House of Commons? The right hon. Leader of the Opposition argues that the advertisement in question is misleading in that it gives the general public the impression that this proposed change to the taxation system is a fait accompli and that Parliament has no role to play in examining and approving the changes. The effect of this may tend to diminish the authority of the House in the eyes of the public.
In reply, the Minister of Justice stated and I quote from page 3821 of Hansard, and this was the argument of the Minister of Justice:
The ads were for proposed changes. They were for informational purposes. In fact they have done their job and we have hundreds and thousands of requests for information. We are trying to inform the people.
The justice minister explains that it was never the government's intention to suggest that legislation would not be submitted to Parliament for debate. During Question Period on September 25, the Minister of Finance also stated that the purpose of the ad was to inform, and in keeping with other documents of the spring budget.
Should the Chair accept the government's explanation and rule that no deliberate contempt was made? At this point it may be useful to quote from a Canadian authority on privilege. As Joseph Maingot explains at page 213 of Parliamentary Privilege in Canada:
There are actions which, while not directly-obstructing the House of Commons or the member, nevertheless obstruct the House in the performance of its functions by diminishing the respect due it.
As in the case of a court of law, the House of Commons is entitled to the utmost respect-.
Does the advertisement diminish the respect due to the House? The hon. member for Windsor West put forward the following argument at page 3823 of Hansard:
When this advertisement-says in effect there will be a new tax on January 1, 1991,-the advertisement is intended to convey the idea that Parliament has acted on it because that is, I am sure, the ordinary understanding of Canadians about how a tax like this is finally adopted and comes into effect. That being the case, it is clearly a contempt of Parliament because it amounts to a misrepresentation of the role of this House.

The Chair is in a quandary. The arguments on both sides of the question are very strong. To add to the Chair's difficulties, procedural authorities also point out that precedents cannot be relied upon to determine if a contempt exists. In contrast, the Chair can more easily determine when a privilege has been breached because the categories are finite and rulings can be based on precedents and authorities. This case is certainly unique. Analogies can be made to the decision rendered by Speaker Sauve on October 17, 1980, but at that time the issue centred on the propriety of the government to advertise in advance of a debate taking place in the House. The issue was not whether the dignity of the House had been affected.
Under these conditions, the Chair feels it must exercise extreme caution against unduly restricting the authority of the House to deal with a perceived contempt, especially given the arguments which have been presented.

I must confess that I have certain doubts regarding this case. Normally in cases of doubt, it has been the practice for Speakers to allow an appropriate motion to go forward for a decision of the House. To this effect, I would like to read from a ruling of Speaker Jerome, found at page 3975 of Hansard for March 21, 1978, where he quotes from a report of the United Kingdom Select Committee on Parliamentary Privileges.
-it might be inferred that the test applied by the Speaker in deciding whether to give precedence over the orders of the day to a complaint of breach of privilege-is, Does the act complained of appear to me at first sight to be a breach of privilege? Rigorously applied, it would mean that no complaint of breach of privilege could ever be entertained unless the Speakerwas of opinion that the act or conduct complained of was a breach of privilege-.
October 10, 1989

Borderline cases and arguable ones would be excluded automatically because in such cases the Speaker could not say that he was of opinion that the act or conduct which was the subject of complaint prima facie constituted a breach of privilege.
In my submission the question which the Speaker should ask
himself-should be -has the Member an arguable point? If the
Speaker feels any doubt on the question, he should-leave it to the
House.
That is a quote in a judgment by Speaker Jerome citing, I should make it clear, the United Kingdom Select Committee on Parliamentary Privileges.
In order to clarify my thoughts on the issue of prima facie and to dispel the doubts that I have referred to, the Chair has pondered the intent of the offending advertisement as compared to its contents. I can express my own opinion that the content was obviously drafted in a cavalier manner; there is an element of confidence, if not of boldness, in the use of a phrase as definitive as "save this ad".
The Ministers of Justice and of Finance have said to the House that the intent of the ad was to inform Canadians. Members are well aware of our practice of accepting the word of an hon. member of the House. In accepting the ministers' explanations, the question of intent is answered and accordingly some of the Chair's doubts are also dispelled. The intent of the ad was not to diminish the dignity of the House. It is difficult to find prima facie contempt.
However, I want the House to understand very clearly that if your Speaker ever has to consider a situation like this again, the Chair will not be as generous. This is a case which, in my opinion, should never recur. I expect the Department of Finance and other departments to study this ruling carefully and remind everyone within the Public Service that we are a parliamentary democracy, not a so-called executive democracy, nor a so-called administrative democracy.


Some Hon. Members:: Hear, hear!


Mr. Speaker:: In order that all hon. members know exactly what the procedure is, and in order that members of the public who are watching and listening understand clearly what the procedure is, let me return to what I said before, that if I had decided that this matter ought to go to the House, it would be followed, or could be followed, by a debate and a vote.
Routine Proceedings
I believe it is in the interest of our parliamentary system of government to have a clear statement from the Speaker which cannot be misinterpreted either in debate or by a vote. A vote on this issue might not support the very important message which your Speaker wishes to convey and which I hope will be well considered in the future by governments, departmental officials and advertisement agencies retained by them. This advertisement may not be a contempt of the House in the narrow confines of a procedural definition, but it is, in my opinion, ill-conceived and it does a great disservice to the great traditions of this place. If we do not preserve these great traditions, our freedoms are at peril and our conventions become a mockery. I insist, and I believe I am supported by the majority of moderate and responsible members on both sides of the House, that this ad is objectionable and should never be repeated.
I have deliberately made this ruling with great care in order that if ever this issue has to be debated and considered by this House again these comments will serve to guide the House in its deliberations.



ROUTINE PROCEEDINGS


Hon. Doug Lewis (Minister of Justice and Attorney General of Canada):: Mr. Speaker, I am pleased to table, in both official languages, a number of Order in Council appointments which were made by the government pursuant to the provisions of Standing Order 110(1). These have been referred to the appropriate standing committees, a list of which is attached.


COMMITTEES OF THE HOUSE
Mrs. Edna Anderson (Simcoe Centre):: Mr. Speaker, on behalf of the chairman I have honour to present the report of the legislative committee on Bill C-21, an act to amend the Unemployment Insurance Act and the Employment and Immigration Department and Com-

October 10,1989
Routine Proceedings
mission Act, in both official languages, with amendments.


PUBLIC ACCOUNTS-SECOND REPORT OF STANDING COMMITTEE
Mr. Len Hopkins (Renfrew-Nipissing-Pembroke):: Mr. Speaker, I have the honour to present, in both official languages, the second report of the Standing Committee on Public Accounts.
In this report the public accounts committee addresses the need to attain an unqualified audit opinion on the audited financial statements of the Government of Canada.
For a number of years now the Auditor General, who audits the accounts of the government, has been expressing several reservations in his audit opinion on the government's financial statement. For the issues associated with two of these reservations considerable progress has been made in the accounting profession and in the government departments responsible for the preparation of the accounts of the financial statements of Canada.
These reservations concern first the consolidation of Crown corporations in the government's accounts and second the accounting for employee pension liabilities.
Consequently the public accounts committee has recommended that the government act to remove audit reservations from its financial statements by announcing the appropriate accounting policy changes in the next budget of the Minister of Finance for implementation in the 1989-1990 Public Accounts of Canada.
[.Editor's Note: See today's Votes and Proceedings. [


CRIMINAL CODE
Hon. Ralph Ferguson (Lambton-Middlesex) moved: for leave to introduce Bill C-266, an act to amend the Criminal Code (offences against the foetus).


Mr. Speaker:: Is it the pleasure of the House that the hon. member shall have leave to introduce the bill?


Some Hon. Members:: Agreed.


Ralph Ferguson: Mr. Speaker, I present this bill today because I believe in the sanctity of human life and the rights of the unborn. We already recognize the current lack of effective legislation on this matter at the present time. I trust this bill will fulfil the needs and protect the rights of the unborn.


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

Right Hon. John N. Turner (Leader of the Opposition) moved:: That, pursuant to Standing Order 81(4)(A) and Orders made Tuesday, April 4 and TUesday, June 27, 1989, consideration of Transport Votes 1, 5, 10, 11, 15, 16, 20, 25, 30, 35, 40, 45, L50, 55, 60, 65, 70 and 75 of the Main Estimates for the year ending March 31, 1990, by the Standing Committee on Transport be extended beyond October 11, 1989.


Mr. Speaker:: Pursuant to Standing Order 81(4)(A) and Orders made Tuesday, April 4 and Tbesday, June 27, 1989, the motion is deemed adopted.


PETITIONS
Hon. Herb Gray (Windsor West):: Mr. Speaker, I have the honour to present pursuant to Standing Order 36 a petition which has been certified correct as to form and content. This is another of a very large number of petitions in which in this case citizens of Windsor, Ontario humbly pray and call upon Parliament to reject the government's proposed goods and services tax.


Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, I have two petitions, one in French and one in English, in which your petitioners humbly pray and call upon Parliament to reject the new goods and services tax because it is regressive, because it will increase inflation, because it will mean considerable hardship for low and middle income families and because it will raise interest rates and increase unemployment. The Government's proposal to make all Canadians pay a sales tax on goods and services is wrong, and these people say so in no uncertain words!
October 10, 1989


Mr. Sergio Marchi (York West):: Mr. Speaker, I have the honour to present a petition collected in my riding of York West by Mr. and Mrs. Manzo. They have gone around to various neighbourhoods in York West and have filed a petition solidly in support of the opposition's request that the goods and services tax be withdrawn from this House of Commons.
The petitioners in fact quote that there have been some 31 new taxes or tax increases since 1984 and that this tax will only build on that regressivity and make life very difficult, particularly for working middle class families in the riding.
I also have two further petitions that in essence are asking for the very same objective, namely, to withdraw this goods and services tax. It is signed by petitioners living in the great city of Windsor.


Mr. George Proud (Hillsborough):: Mr. Speaker, pursuant to Standing Order 36,1 have the honour to present three petitions on behalf of many Canadians who ask that Parliament do reject the proposed goods and services tax.


Mr. Fred J. Mifflin (Bonavista-TVinity-Conception):: Mr. Speaker, I rise pursuant to Standing Order 36 to present a petition duly certified by the clerk. It is signed by Canadians who are very concerned about the tax represented by the government's goods and services tax. They are concerned about a number of promises that have been broken and, in particular, they are terribly concerned about where this tax is going to go. It is starting at 9 per cent and we are not really sure where it will end.
These petitioners humbly pray and call upon Parliament to reject the proposed goods and services tax.


Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, I have the honour and privilege to table a petition that has been signed by 26 residents of the community of Atikokan, certified correct as to form and content by the clerk of petitions.
These petitioners are from a community that lost its passenger rail service over 10 years ago. They are expresssing their concern about the closure of the rest of
Routine Proceedings
the system throughout northwestern Ontario in particular.
The undersigned call upon Parliament to maintain VIA Rail, Canada's present national network, to upgrade VIA Rail with new equipment and to give VIA Rail a sufficient budget to maintain its national mandate for passenger services.


Mr. John Harvard (Winnipeg-St. James):: Mr. Speaker, pursuant to Standing Order 36 I too have the privilege and honour to present a petition relating to the government's goods and services tax. It has been certified correct as to form and content by the clerk.
In their petition this group of Canadians points out that this government in the past five years has increased taxes not less than 31 times and that the GST would prove to be an unfair hardship on low and middle income Canadians.
The petitioners humbly pray and call upon Parliament to reject the proposed goods and services and tax.


Mr. Len Taylor (The Battlefords-Meadow Lake):: Mr. Speaker, pursuant to Standing Order 36 I am honoured to present a petition on behalf of a number of Canadians who are calling upon the government to reconsider its decision to curtail VIA services in certain parts of Canada and to dismantle it in others.
The petitioners are asking Parliament to maintain, improve and modernize VIA Rail in those areas of the country where it can provide a more rapid, economical, safe, convenient, environmentally sound and energy efficient alternative to other means of transportation.


Ms. Joy Langan (Mission-Coquitlam):: Mr. Speaker, pursuant to Standing Order 36 and certified correct by the clerk, I have a petition signed by 31 people from Maple Ridge in my riding of Mission-Coquitlam who are not only calling on the government to reject the current proposed goods and services tax but are asking that a reform in the taxation system be introduced so that there is an effective minimum tax on wealthy individuals and corporations and to ensure that if and when there is broad public consensus on a sales tax

October 10,1989
Government Orders
measure to replace the manufacturers' sales tax this reform not be an opportunity for the government to impose a massive tax grab.


Mr. John R. Rodriguez (Nickel Belt):: Mr. Speaker, I have the privilege and responsibility under Standing Order 36 to present a petition signed by many residents of Mission, British Columbia.
These Canadians from Mission, British Columbia, point out that the proposed goods and services tax is a regressive tax and that it lacks and does not show regard for taxpayers' ability to pay, and that in fact the government is now trying to tax reading, haircuts, diapers, coffins and home heating fuels.
The petitioners therefore call upon Parliament to reject the current proposal for a goods and services tax.


Mr. Ron Fisher (Saskatoon -Dundurn):: Mr. Speaker, it is a great pleasure for me to stand up pursuant to Standing Order 36 to present this petition from people in the lower mainland of British Columbia who are opposed to the government's intention to introduce a goods and services tax.
The petitioners point out that the present tax system has not been fully utilized in taxing those who are well able to pay-the wealthier and the corporations within our society. While the present tax is regressive enough they point out that the goods and services tax is going to be even more regressive and are asking the government to reconsider its intention to introduce it.


Mr. Joe Comuzzi (Thunder Bay-Nipigon):: Mr. Speaker, I too have the honour and privilege to present petitions properly certified and signed by the proper number of people from my adopted city of Windsor who petition the House, through their signatures, to do away with the goods and services tax.


Mr. Peter Milliken (Kingston and the Islands):: Mr. Speaker, I have the honour to present a petition duly certified in accordance with Standing Order 36. It is signed by a number of residents of the city of Windsor.
The petitioners are opposed, as indicated in this petition, to the unfair and vicious goods and services tax that has been proposed by this heartless government. They call upon Parliament to reject the tax.


Mr. Nelson A. Riis (Kamloops):: Mr. Speaker, it is my pleasure to present a petition, pursuant to Standing
Order 36, from a number of people from Coquitlam, Maple Ridge, Burnaby, Pitt Meadows and Port Moody, British Columbia, who are pointing out that while 60,000 profitable corporations pay no income tax it seems unfair that people now will be required to pay tax on their reading, diapers, haircuts, home heating fuels and the like.
The petitioners are asking the government to back off from its decision to proceed with the national sales tax.


Nelson Andrew Riis: On a different matter, Mr. Speaker, I present a petition on behalf of a number of western Canadians who point out the fact that passenger rail service is an environmentally sound way to transport Canadians. They ask the Government of Canada once again to back off from its decision to curtail VIA Rail service throughout most of Canada.


QUESTIONS ON THE ORDER PAPER
Mr. Albert Cooper (Parliamentary Secretary to Government House Leader):: Mr. Speaker, I ask that all the questions be allowed to stand.


Mr. Speaker:: Shall all the questions be allowed to stand?


Some Hon. Members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House proceeded to the consideration of Bill C-20, an act to amend the Excise Tax Act and the Excise Act, as reported (without amendment) from a legislative committee.
Mr. Speaker:: It is now my duty to make a ruling with respect to a number of amendments that were filed late Friday afternoon.

There are eighteen (18) motions in amendment set down on the Notice Paper for the report stage of Bill
October 10, 1989

Government Orders
C-20, an Act to amend the Excise 'lax Act and the Excise Act. I have had an opportunity to examine them.

Motions Nos. 2, 3, 5, 6, 7, 8, 9,11, 12,13, 14, 15,16 and 18 standing in the name of the hon. member for Calgary Northeast each seek to delete a separate clause of the bill. The cumulative effect of these motions would be that the House would proceed through another second reading debate with the possibility, of course, that the bill could ultimately be defeated by having all of its clauses deleted. The Chair has strong reservations about this manner of proceeding on the bill at this stage.
I will be guided by the decision of Mr. Speaker Francis concerning the report stage of Bill C-9, the Canadian Security Intelligence Service Act, which can be found in the Debates at pages 4559-4566 on June 12, 1984 and again at pages 4680-4683 on June 14,1984. Therefore the grouping of all the deleting motions will follow the guidance found in that ruling.

I have misgivings with respect to motion numbered 1 standing in the name of the Hon. Member for Yukon (Ms. McLaughlin). According to Citation 524 of Beau-chesne's Parliamentary Rules and Forms, Fifth Edition, on page 176:

The motion by which a tax is proposed in the House is now treated as an effective expression of the financial initiative of the Crown, and therefore, as the standard in relation to which the admissibility of amendments is determined. Accordingly, an amendment is debarred, not only from increasing the rate of a tax, but also from extending its incidence to new classes, even while proposing to relieve other classes of payers.
However, Erskine May's Parliamentary Practice on page 839 states that amendments must not exceed the scope, increase the amount or extend the incidence of any charge upon the people defined by the terms of Ways and Means resolutions by which the provisions propose to be amended are authorized.
Having studied the amendment I am of the view that the hon. member is limiting the scope of the tax by providing for an exemption for northern residents. Therefore it will be grouped for debate with Motion No. 2, which is also in order.

An affirmative vote on motion numbered 1 obviates the necessity of a vote on motion numbered 2. However, a negative vote on motion numbered 1, necessitates a vote on motion numbered 2.

Motions Nos. 3, 6, 7, 8, 9,12, 13,14, 15 and 16 standing in the name of the hon. member for Calgary Northeast will be grouped together for debate. A vote on Motion No. 3 will be applied to all of the other motions in the group that I have just listed.
]Translation]
Motions numbered 4 and 5 standing in the names of the Hon. Members for the Yukon (Ms. McLaughlin) and for Calgary Northeast (Mr. Kindy) respectively will be grouped together for debate but voted on separately.

Motions Nos. 10 and 11 standing in the names of the same hon. members will be grouped for debate and voted on as follows: an affirmative vote on Motion No. 10 will obviate the need for a vote on Motion No. 11. However a negative vote on Motion No. 10 will require a vote on Motion No. 11.
Motions Nos. 17 and 18 standing in the names of the same two hon. members will be grouped for debate. If there is an affirmative vote on Motion No. 17, no question on Motion No. 18 will be put to the House. However a negative vote on Motion No. 17 will require that the question be put to the House on Motion No. 18.

I will now put motions numbered 1 and 2 to the House. [English]


Ms. Audrey McLaughlin (Yukon) moved:: Motion No. 1
That Bill C-20 be amended in Clause 1 by adding immediately after line 16 at page 1 the following:
"except for northern residents as defined in the Income Tax Act.


Mr. Alex Kindy (Calgary Northeast):: moved:
Motion No. 2

October 10, 1989
Government Orders
That Bill C-20 be amended by deleting Clause 1.


Audrey Marlene McLaughlin: Mr. Speaker, I have put forth this amendment, and I want to make a few remarks that I think justify the amendment as proposed.
This tax clearly is unfair to northerners. In the north I point out that basic telephone service is not available on a universal and affordable basis.
For example, I cite a study that was done in 1981, which found that telephone users in the Northwest Territories, northern Quebec and northern Ontario spent on average between $625 and $650 per year on toll services. This compared with an average of $206 per year for subscribers in the Bell territory as a whole. Clearly, with the higher cost of living in the north and the per capita income which is generally lower, this is an added burden for people who do live in the north.
In particular, as I have pointed out in other debates, the telecommunications tax hurts small business in rural areas that must do much of their ordering and then-other business with southern businesses necessitating that they do this by long distance.
Another element of this that I wanted to point out is that radio phones which are used frequently by residents in rural areas in northern areas are in a sense doubly taxed because every telephone call that is made via a radio phone is in fact a long distance call. People who must rely on radio phones for their communication with their children's school or with doctors-with all of the regular business that most of us have to deal with in our personal lives-are being doubly penalized because those then become taxable long distance calls.
I would also add a comment on the inflationary effect of this kind of tax. The Yukon Government, for example, has estimated that a 1 per cent increase in the telecommunications tax means about $4 million extra to the taxpayer and of course to the Yukon Government. Obviously the Yukon Government has to get that money from somewhere. All long distance calls are taxed as well as the public mobile telephone systems. This does have an added impact on northern residents.
I would draw the House's attention to a report done in 1988 by the Public Interest Advocacy Centre, which has
done a fairly comprehensive report on northern consumers and telecommunications policy in March of 1989.
In that report both the necessity of telephone communications for northern residents and the added burden that they have is outlined. I quote from that report that indicates that the per capita income, for example, for Inuit in the Northwest Territories was only 53 per cent of the average for the general Canadian population. In northern Quebec it was only 40 per cent of the general average, despite the fact that the average family spends three times more than a southern resident on toll services.
Similarly I would add that this report indicates that most of the calls in the north are ones currently classified and billed as long distance. For northerners toll service is an essential part of basic telephone service. This is a very important difference and one of the basic reasons for this amendment that I am proposing.
Functionally long distance service in northern and remote areas is really equivalent to local service in many southern areas. The result is that southern subscribers get unlimited free calling for most of their telephone calls while northern subscribers are paying toll services for each call.
Therefore, Mr. Speaker, I propose this amendment which I believe would, if accepted, reduce the burden on northerners and make a more equalized and fair system comparable to southern users of the telecommunications system.


Alex Kindy: Mr. Speaker, I welcome this opportunity to support motion No. 1 in the name of the Hon. Member.
I have children who work in the North, a son in Kuujjuaq and a daughter in Blanc-Sablon. I have visited these communities in Canada's North, and I have seen how difficult life in the North can be.
Penalizing these people by increasing the tax on telecommunications would be entirely unacceptable.
These people work in very difficult conditions. They make sacrifices, and I think that a Government that has any heart at all should not even consider penalizing them, penalizing Canada's Inuit.
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That is why I support the Hon. Member's motion, and I believe Parliament should vote in favour of this motion so that people in Canada's North can live the same way as people in Central Canada, in Ontario.


Hon. Roger C. Simmons (Burin -St. George's):: Mr. Speaker, I have a few words to say on this particular amendment. First of all the real solution here, I say to the member for Yukon, would be not to have this latest imposition at all. I do not know where the government is going. I guess I do know where it is going, but I do not like where it is going, particularly on this communications tax.


Mr. Murphy:: What about transportation?


Roger Simmons: The member has chosen half a loaf, and we support that. I hear some coming awake in the NDP early this morning, earlier than usual.
I was about to say, if our colleague would just restrain himself for the moment, that I support what the member is doing because it is at least half a loaf, but the real solution is for the government to withdraw this infamous thing before it inflicts anything further on northerners and southerners alike.
In so far as this communication tax is concerned we have to put it in context with respect to people in my province who are already paying, quite apart from the federal tax which is now going to go to 11 per cent if the administration has its way, paying another 10 per cent provincially so that in compound terms they are paying about 22 per cent because they are paying a tax on a tax. You know that story, Mr. Speaker.
This is uncalled for. It is not needed at all, but if it must go forward then the very least that can be done is that we entertain the amendment put forward by the member for Yukon to at least exempt northern residents. They, in a very particular way, are called upon to bear the tax brunt in this country. The gentleman from Calgary Northeast put it very well when he spoke briefly to the amendment a minute ago. Everywhere one turns, whether it is in clause 1 or elsewhere in the bill, the tax grab continues. This infamous tax grab continues unabated. The unrelenting pulverization of the people least able to pay is well under way by this government.
If one were to take the regional impact of the tax measures in this budget and look at it as it affects northerners, as it affects people living generally in rural parts of this country, one would very quickly and unmistakably come to the conclusion that this government has a hate on for rural people. It has a particular thing in its craw about people who do not live in large urban centres. Everywhere one turns, whether it has to do with the railway abandonments, the closing of rural post offices, the sabotaging of the job creation programs, or if one turns directly to tax measures, which is our subject here today, one will find that the whole program of the government is particularly aimed at rural Canadians. Why are rural Canadians being asked to bear an undue amount of the load of the tax burden and so far as cut-backs are concerned? One would come to the conclusion that this government is in the business of overtly, deliberately shutting down rural Canada.
Take, for example, the job development strategy. There was a time when people in areas characteristic of seasonal employment could look to that kind of a program to tide them over. Not anymore. Now those people have a choice of not qualifying for those seasonal jobs or moving to urban centres, because the caveat about training requirements in those programs dictates, in effect, that those people can only qualify for those training opportunities if they live in urban areas where there are more sensible training options available. That is just one of the many examples that we can take from the program of this government to demonstrate that it has a hate on for rural Canadians. It is out to get rural Canadians. This particular clause, like the other clause in this bill that we will be dealing with over the next few days, is a demonstration of that. I have delight in supporting the amendment if it comes to that. At least, let us exempt northern Canadians. But the real solution is to get rid of the provision altogether and to have no increase whatsoever in the communications tax.


Rodney Edward Murphy: Mr. Speaker, I was interested to hear the Liberal member for Burin-St. George's get up and speak about how this hurt the north and the rural areas of the country. I remember when he was on the government benches the Liberal government of the day introduced a tax on transportation. We spoke against that and explained that a tax on transportation

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hurt people going into the remote communities of this country. It certainly added an extra, unfair burden of taxation on those people and on those communities, because it was a percentage tax and because the tax was based on the higher air fare that those people had to endure. As a result, people in northern Canada, people in the remote parts of Canada were paying a much higher percentage and a much higher dollar value of tax than those in the south.
For those same arguments, I would like to support the motion put forward by my colleague, the member for Yukon. What we are trying to do with the motion that she has presented to the House today is to recognize that some taxes which are imposed on a basis of a flat percentage rate do add an unfair, unnecessary burden on people in the remote and northern areas of this country. Every time a tax is brought in which is 5 per cent, 6 per cent, 7 per cent, 8 per cent or 9 per cent across the board, what the Government of Canada does not recognize is that some people already have to pay so much more for what is a basic and cheap service in southern and more populated areas. Every time an extra one cent is added to the cost of gasoline, every time a 10 per cent tax is added on airline tickets, every time a tax is placed on long distance phone calls, what you are doing is giving a double burden, an extra burden of taxation on the people in these communities.
For that reason, as we look at this particular tax measure or as we look at other tax measures such as the notorious GST, we have to make sure that we really recognize what we are doing by passing these measures. I do not think the members on the government side recognize that. I know there are a number of members on the Conservative benches who represent communities that have been hurt by the dismantling of the northern tax benefit. Those members have not been able to get up in the House of Commons and say: Hold on, you are hurting communities in northern Alberta; you are hurting communities in northern B.C., in northern Saskatchewan, in northern Ontario, or in Atlantic Canada. But they know that that is happening and they know that their government, through its taxation policies, is hurting the very communities that they are supposed to be here representing.
It is unfortunate that from time to time government back-benchers feel that they cannot criticize their government. I applaud the government member who got up earlier today to speak in favour of our motion because it has taken that courage to speak out against his ferocious whip and the cabinet ministers of the government.


John R. Rodriguez: Mr. Speaker, I want to say a few words in support of the motion presented by the hon. member for Yukon.
Let me begin by pointing out to Canadians who are watching that this is only a prelude to a government gone tax crazy. I mean, you have got to think about it. When this government came to office there was no tax on telecommunications. In the space of five years, it has tried to muzzle the people of this country by taxing their ability to communicate. This has got to be the ultimate in a government gone mad. It has let power go to its head and it seems that its sole existence is to tax, tax and tax.
Even the so-called manufacturers' sales tax, that silent killer of jobs, when this government came to office was 9 per cent and in the short period of five years it has gone up to 13.5 per cent. The only thing the government understands is to tax, tax, tax. Canadians are sick and tired of the government reaching both hands in both their pockets and their heads in some other part of the anatomy taking the hard-earned dollars out of the pockets of Canadians.
This particular tax on telecommunications is very bad in itself, but particularly so for people who reside in the northern part of our country. For example, in the Nickel Belt area there are many people in communities, primarily native communities, who have to use radio and telephones. When they have to phone the school that their children have been taken to, it is not like you or I, Mr. Speaker, picking up the telephone and phoning locally. It is a long distance call on the radio telephone. This government is going to tax that 11 per cent, moving it up one more per cent.
In fact, a study was done by the Public Interest Advocacy Centre on northern consumers and telecommunications policy. In their appearance before the regulatory body they stated: "In 1981, in connection with Bell Canada, it was found that Bell subscribers in the Northwest Territories, northern Quebec and northern Ontario spent an average between $625 and $650 per year on toll
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services. This compared with an average of $206 per year for subscribers in the Bell territory as a whole."
So now we are punishing people because they live in these nether regions of our country where we have been encouraging and trying to encourage people to go and settle and develop this country of ours. What this government has come along with is a tax on the ability of those people to communicate with each other even within their particular area which necessitates a long distance call.
I cannot understand, and I know that I am speaking for many Canadians, who cannot understand the mentality of a government like this. Outside of the member for Calgary Northeast, an honourable gentleman who spoke in support of this motion, they are all sitting on their hands. They will all sit. Why? Because their big boss has whipped them into line.
There are very few members on the other side who are prepared to throw off the whips of tyranny of Brian Mulroney and his honchos in the cabinet. There are very few of them willing to stand up and be counted: Canadians are waiting to hear them because we have to be united in defeating this tax hungry government. It is the only way. I say to Conservatives on the other side all we need is 20 of you to change positions. We beg you for one simple little vote. Vote with the opposition and send a message to this government. Vote for your own constituents and show them that you are representing their best interests. Surely you are not going to go along like a bunch of trained seals; somebody was so unkind as to call them lemmings. Surely you are not going to sit up and when a fish is thrown clap your flippers and say: "Aye, aye, Skipper." Surely, there are 20 of you over there who will hear the cry of the people saying: "Save us from this tax-crazy government. Relieve our burden of taxes, upon taxes, upon taxes." Surely there are 20 of you who can respond positively to the call.


Mr. Dick:: Don't have a heart attack.


John R. Rodriguez: This government is going to give a lot of Canadians a heart attack with what it has proposed. It is not enough that it will gyp them 11 per cent, but if you live in the province of Ontario you get 8 per cent put on top of that. You have a multiplicity of tax upon tax.
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In a spirit of conciliation I reach out to brothers and sisters over there. We need 20 good men and women who will join with us to defeat this iniquitous tax proposal.
I know there is a thing called whips and discipline over there.


Paul Wyatt Dick: What cuts are you proposing?


John R. Rodriguez: We are talking about this particular tax measure that the government has proposed. I am glad you raised that. Why don't you put a tax on mergers and corporate takeovers like the Americans are going to do? Last year we had takeovers of $5 billion. Just imagine if you put on a little 9 per cent tax. After all it is a sales tax. Somebody is buying something. Put on a 9 per cent tax. Look at what we could gain.
What about going even further? When one corporation wants to buy out another, it borrows money and is allowed to write off the interest on the money used for the take-over. They have not created one new job, but they are allowed to write off the interest on the money they borrowed for the take-over. Does that sound fair? No, it is not fair. That is why I appeal to 20 people over there. If they have any courage of conviction, on this one occasion join with us and let us defeat this. Let us strike a blow for ordinary Canadians. Let us strike a blow for working men and women in this country.


Nelson Andrew Riis: Mr. Speaker, I am pleased to have a chance to follow my hon. colleague who pointed out very clearly how the New Democrats feel about one more tax grab in the long march of tax grabbing.
The point that my hon. friend for Nickel Belt made was very appropriate. Not only is this an attack on working people and their families generally, it is an attack especially on certain Canadians. We consider that it is a part of a process that we have seen, and I refer to the general sales tax.
Obviously some Canadians are going to be hit harder by the general sales tax than others. Those people who live in the northern parts of Canada, the more remote regions will be hardest hit. For example, those Canadians who have to buy winter equipment, a lot of snow tires, all sorts of extras like snow clothing, and an excessive amount of heating fuels and so on, relative to southerners. In Vancouver you do not have to buy snow tires or snow clothing. Obviously, in Whitehorse, Prince George,

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Kamloops, Red Deer, and right across the country in all the northern areas you have to.
So what we are saying is that certain Canadians will have to spend a lot more of their hard earned money on sales taxes on items that they must buy, while southerners will not have to, or do not have to buy in the same amount. Heating fuel perhaps is the most obvious.
As my hon. colleague from the Yukon pointed out, the far northern regions are going to be extremely hard hit, not only generally by the Conservative government tax programs, but by this particular tax measure on telephone calls. That is what we are talking about.
When people in Canada who live in remote areas have a need to communicate for personal reasons, business reasons, or just day-to-day living reasons, make a long distance call; they are not like others living in southern Canada who simply pick up the telephone and dial to anybody they want to, virtually toll-free. That is not the way in the north. As you well know, Mr. Speaker, it is long distance telephone rates; it is long distance communication. When a tax is put on telecommunications, obviously you are taxing more heavily those people who have a greater amount of their purchasing power going into long distance calls.
My hon. colleague for the Yukon indicated that this needs to be amended to recognize that some Canadians experience greater telephone communications cost simply because of where they happen to live in this country. It seems to be unfair that we would introduce a tax that would obviously discriminate against those Canadians living in remote areas, a tax that would be biased against those Canadians who live in remote areas.
I would venture to say that virtually every tax initiative we have seen introduced by the Conservative government does just that. Certainly, the goods and services tax will, and now in Bill C-20, we are recognizing that again in terms of telecommunications costs, those people who live in more remote areas will be adversely affected.
For that reason, my hon. colleague for Yukon suggests that we amend the bill so that the telecommunications service tax not be allotted to northern members as is defined by the tax act which, of course, includes people living in the northern parts of Ontario, Quebec, Newfoundland, Manitoba, and other points west. I think it is a very reasoned amendment.
I ask my hon. Conservative friends across the aisle to speak out on some of these measures. Many members here come from remote areas, from far northern constituencies.
Are they suggesting, by the fact that they are mute on this issue, that they in fact support it and think it is a good idea to be taxing people who live in distant communities on their telephone charges. That is what they are saying because so far only one has had the courage to speak out on behalf of his constituents, and he has supported this amendment as any thoughtful parliamentarian would.
I will conclude my remarks in anticipation that we will hear some thoughtful interjections from hon. members opposite as we move to try and improve Bill C-20. As my colleague from Nickel Belt indicated in a very succinct fashion, this is one more in the long list of tax grabs by this government.
The government always asks where else can it get the money. One obvious way would be to reduce interest rates immediately which would collapse a good part of the deficit and the debt. It would stimulate, almost automatically, economic activity in every part of the country which would generate more revenue in sales tax, excise tax, personal tax, business tax and corporate tax. But no, Mr. Speaker, we are bound and determined that interest rates will remain very high and consequently the debts of the country will increase, the deficit increases, and economic development is strangled as a result of fiscal and other financial policies.
There are many places to get tax money beyond changing the interest rate policy. May I suggest just one in conclusion. I think all of us are well aware of the
60,000	profitable corporations in this country that do not pay any income tax at all. Of course, there are many that pay $20 a year, $200 a year, or $500 a year, but many do not pay a single penny in income tax. There are 60,000 large profitable corporations not paying a single cent. It is shameful. Other countries like the United States does not allow this to occur. In 1986 President Reagan brought in a minimum corporate tax so that there are not
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have tens of thousands of large corporations getting away scot-free.
However, in Canada the Conservatives have taken care of the large corporate sector so that now they are trying to nickel and dime a long distance tax from northern residents. Would they put a mimimum corporate tax on the Bank of Montreal? Would they put a minimum corporate tax on General Motors, Nova Corporation, the Royal Bank of Canada, or the Imperial Bank of Commerce? No, they would not touch those. But touch the Inuit and those people living in northern Canada and add a few dollars every week to their necessary telephone charges. It is absolutely disgusting what is going on. It is time that we allow members of the Conservative government to stand up and explain why we are nickel and diming every conceivable person in terms of tax increases. Why does it not bring in a minimum corporate tax so that the Bank of Montreal would be guaranteed to pay its fair share of tax every year, or Cadillac-Fairview pays its fair share of the tax? Why does it not bring in such legislation? Why does it bring in legislation that is going to put an extra charge on the telephone costs for all residents, and this particular clause draws our attention to the plight of those people living in Canada's north?
I stand down to await anxiously my Conservative colleagues across the way explaining why they feel this tax is necessary for a country which is the second largest in the world geographically. Being such a large country we should be sensitive to the fact that there some people who rely on telecommunications services and consequently bear a heavier share than others as a result of the huge country in which we live. I also ask them to explain why 60,000 profitable corporations get out of paying any income tax at all year after year, while the little shop at the corner store pays their fair share, the mom and pop shop pays their fair share, the person running the little welding shop pays his fair share, but not the Royal Bank of Canada, not Cadillac-Fairview, not Nova Corporation, not 60,000 other large profitable corporations that do not pay a single cent in spite of their hundreds of millions of dollars in profit year after year. I will step down and await some of my Conservative friends to explain those two items.
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Iain Francis Angus: Mr. Speaker, I want to enter this debate for a few moments. Most of the residents in my riding will not be impacted by the amendment put forward by my colleague, the member for Yukon, because most of my riding is not included in the northern tax area, although there are some areas that are in dispute and I understand that the hon. Rene Brunei will be handing down his report shortly. We are all waiting with interest to see what he decides in terms of the levels of support.
In northern Canada, in the northern parts of our provinces, there is a tendency over time to relocate seniors into larger communities. They are taken from the community where they have lived for years, whether it is a farm community or a mining community, and because of the way provinces have evolved they have put longterm care facilities in major centres. So seniors are being taken away from their families and moved to a central location. That is traumatic, but now, because of yet another tax increase, it will be more expensive for them to keep in touch with their loved ones, with their children, and vice versa, for the children to keep in touch with their mother or father in a long-term care facility.
The other thing that we are talking about, and that is why my colleague put forward the amendment, is it is not just the telephone calls that are being taxed but it is the reason for those calls. You are going to tax a call to the ambulance. You are going to tax a call to the fire department. You are going to tax a call to the police department. You are going to tax the calls of people looking for work, of doing a job search around their region, on top of the unemployment insurance cutbacks that this government is intent on doing, and making it much more difficult for the out of work individual to find gainful employment.
It is also going to impact on the cost of doing business in the north. Every cost that that small business or even large business has to endure, and a lot of the work today is done by telephone in terms of on-time delivery for inventory, will add to the cost of doing business in the north. That will result in two things. First of all, the obvious, which is higher prices to the consumer yet again. The second is one more disincentive for industries and businesses to locate in the north, and a greater incentive

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for them to once again concentrate around the golden horseshoe in Toronto.
The other aspect that I want to speak about, and one that has not been talked about so far this morning, is the impact of cable TV. Now one may think that it is a luxury. Those members of the House who live in the major metropolitan areas say: "We do not need cable. We just turn on the TV and there is the signal". In northern communities there is no such thing as off-air signals. Residents have to rely on cable if they are in an organized area. It is much more expensive to provide that service because it is a smaller market, and yet they are now being taxed at a greater percentage so that their cost is even higher. They get their news through those channels, whether it is on Cancom in terms of the four Canadian channels that are available or Newsworld which is now a service of the Canadian Broadcasting Corporation, supposedly available to all Canadians, but is not because some have not picked it up. When the Yukon picks it up it is going to cost them that much more because it is already a high cost to deliver the signal and to distribute it.
The tax is wrong. I support my colleague's move to, at the veiy least, exempt northern residents, those defined by the Income Tax Act, from this extra burden. I do hope, like my colleagues have said before, that the members opposite will seriously consider supporting this amendment because it will send a signal to northern Canadians that perhaps somebody is listening.


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


Some Hon. Members:: Question.


The Acting Speaker (Mr. Paproski):: The question is on Motion No. 1 standing in the name of the Hon. Member for Yukon. Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mr. Paproski):: All those in favour of the notion please say yea.


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


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


The Acting Speaker (Mr. Paproski):: Pursuant to Standing Order 76(8), the recorded division on the proposed motion stands deferred.
Motions Nos. 3,6, 7, 8, 9,12, 13, 14, 15 and 16, standing in the name of the Hon. Member for Calgary Northeast will be grouped together for debate. A vote on Motion No. 3, will be applied to all other motions in the group that I have just listed.


Alex Kindy: Motion No. 3.
That Bill C-20 be amended by deleting Clause 2.
Motion No. 6.
That Bill C-20 be amended by deleting Clause 4.
Motion No. 7.
That Bill C-20 be amended by deleting Clause 5.
Motion No. 8.
That Bill C-20 be amended by deleting Clause 6.
Motion No. 9.
That Bill C-20 be amended by deleting Clause 7.
Motion No. 12.
That Bill C-20 be amended by deleting Clause 9.
Motion No. 13.
That Bill C-20 be amended by deleting Clause 10.
Motion No. 14.
That Bill C-20 be amended by deleting Clause 11.
Motion No. 15.
That Bill C-20 be amended by deleting Clause 12.
Motion No. 16.
That Bill C-20 be amended by deleting Clause 13.
He said: Mr. Speaker, first I would like to say that the Minister of Finance when he brought in his budget said that we have been overtaxed in the past.
I would like to say that when our government took over in 1984-85 the manufacturers' sales tax was at 9 per cent. Now with this new bill you would bring it up to 13.5 per cent. This is penalizing our manufacturers. It has penalized them because they have to export to compete. This bill is making them less competitive and therefore manufacturers will not be able to sell our products abroad. I would like to quote the minister when he was
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addressing the legislative committee on Bill C-20. He said:
"This bill contains the necessary legislative amendments to implement the federal excise tax and excise duty changes announced in the budget of April 27, 1989. These measures are an important component of our government's plan of fiscal action to address the problem of the large and growing public debt by recognizing in reaction to the threat posed by the growing burden of the debt we are helping to build a stronger Canada for both present and future generations of Canadians".
These are beautiful words, but what is the reality?
Canada's revenues in 1984-85 were approximately $70 billion and our expenditures were $109 billion, for a total yearly deficit of $38 billion. For the fiscal year 1989-90, revenues have increased to $112 billion, taken out of the pockets of the poor people who live in Canada and small businesses. Very little came from the pockets of large corporations. Expenditures in that fiscal year are increased to $142 billion. We have been collecting more and spending more money.
The minister says he wants even more money. I wonder whether we are not moving in the direction of Argentina, for instance, that had no fiscal responsibility and today has the largest foreign debt of the nations in South America. The reason I mention Argentina is that in 1949 it was the sixth richest nation in the world and today it has an inflation rate of 300 per cent to 400 per cent a year. If we do not become fiscally responsible Canada could move in the same direction.
Our total national debt is close to $370 billion and it was only $180 billion in 1983-84. The Minister of Finance has doubled our national debt in a period when there was prosperity across Canada. There was work in central Canada. The economy was not overheating in the Atlantic provinces or in western Canada, but it was overheating in central Canada. So what did the Minister of Finance do? He raised the interest rates instead of taxing the big corporations which have not been paying their fair share.
I would like to give an historical perspective on the deficit and the debt so that we can better understand it and bring in solutions that would not simply increase the taxation powers of the government but bring about restraint and better economic management to address
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the fundamental problem of the national debt and the spending of the federal government.
As I have already said we have increased the national debt. We are collecting more money from individual taxpayers so that today each Canadian child and adult has a debt of approximately $13,000.
It takes 34 cents out of a dollar of public revenue to pay just the interest on that debt. The interest payments have outstripped the yearly deficit of $30.5 billion in this fiscal year.
The government proposes now to bring in a new goods and services tax that is going to follow those amendments to this bill. I would like to point out that in 1969-70 the total national debt was $17.5 billion. It was only 21 per cent of the Gross National Product.
In the year 1988-89 the national debt has increased to $350 billion. It is 36 per cent of the Gross National Product. The proportion of the debt to the Gross National Product has almost doubled and no country can tolerate such an increase.
I would say that people in the west, and in particular Albertans, understand very well what this goods and services tax means. It means that it will create more inflation. It will create at least 3 per cent more inflation. Albertans understand that. They understand that it will increase interest rates of the banks. They understand that. Some members of this House say that they do not understand.
They understand as well that it is the consumer who will pay for this goods and services tax when he goes to have his hair cut. There will be a tax on funerals and telecommunications. This is a regressive tax. I hope the Minister of Finance will listen, not to his officials in the Department of Finance, but to the people of Canada. The people of Canada do not want this tax. They have already been paying. Some of them ask where they will get the money.
I would like to refer the Minister of Finance to the fiscal remissions of large corporations that have not been paying their taxes. I believe that this tax is not only inflationary. It is regressive because it punishes the low income earners. It does not pass, as well, the test of fairness. It creates a bureaucracy. The Minister of National Revenue confirmed what I was saying six

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months ago, that it will take another 4,000 Revenue Canada inspectors.


Mr. Speaker:: I regret to say that the hon. member's time has expired.


Peter Andrew Stewart Milliken: Mr. Speaker, the motions that the hon. member for Calgary Northeast has proposed in the House today I think indicate incredibly sound sense. The extraordinary thing is that on the motion we have already debated today there has been no one on the opposite side of the House stand up to refute any of the arguments he has put to the House, in my view, quite ably.
I can understand the reluctance on the part of hon. members opposite to defend the indefensible, but it is their budget that is being proposed here and their budget taxation measures that are being discussed in these amendments. You would think that the minister or somebody would stand up and say: "The reason we are imposing this tax is because of this or because of that". But there is no defence of the taxation that has been proposed.
The hon. member for Calgary Northeast has provided the House with some criticisms that I think are worth while taking into account. The government obviously is ignoring those criticisms from one of it own members. It is a shocking example of arrogance and unwillingness to come into this House and discuss this matter. It says: "take it or leave it" and leaves it for us to vote against it.
Why the members on the opposite side sit on then-hands and vote with the Minister of Finance for these incredibly harsh and vicious taxes is beyond me. The hon. member for Calgary Northeast has clearly seen the light and he realizes that this is something that is unacceptable to the people of Canada. Yet this government seems bent on pursuing this course, come what may.
I would like to turn to the taxes and some of the figures that the hon. member for Calgary Northeast has cited. He has already referred to the unbelievable spending habits of the government, and how expenditures have increased so dramatically from the time they took office. He pointed out, quite rightly, the $42 billion increase in taxes that Canadians are now paying since
this Tory mismanagement group took over the operation of the Government of Canada in 1984.
The amount raised by taxation has gone from $70 billion, as the hon. member pointed out, to $112 billion in that five-year period. There have been 31 separate tax increases, and here we are debating a bunch more. Canadians have pretty well had it. This government has imposed too many tax increases.
I find it quite extraordinary that the Minister of Finance, in his rantings and ravings about the evils of the current manufacturers' sales tax, has repeatedly told Canadians how unacceptable that tax is, this silent killer of jobs. Even the Prime Minister has taken up the refrain, chanting a around the country: "this tax is a silent killer of jobs".
If it is such a silent killer of jobs, why have they increased it so drastically from 9 per cent to 13.5 per cent as they are doing in this bill? If it is a silent killer of jobs surely you lower the tax, you do not increase it. But not this bunch. They do not seem to understand their own rhetoric. They say it is a silent killer of jobs on the one hand, but they make it worse by increasing it instead of lowering it. It simply escapes my comprehension.
I think most Canadians agree with me that this is sheer folly. The government is acting improperly, it is not doing its job, it is mismanaging the Canadian economy and mismanaging our tax system. It is mismanaging almost everything it touches. It is ruining VIA Rail. It is mismanaging one thing after another in Canada. It is time for the government to get out if it cannot do better.
I want to go back to the gasoline taxes because they are one set of the taxes that are being raised in this bill. The memory of hon. members opposite must be exceedingly short. I am sure the hon. member for Calgary Northeast recalls well the day the present Minister for International Trade who was formerly the Minister of Finance in another incarnation stood in this House and presented a budget. I was not here, but I remember hearing a lot about the budget at the time. The budget proposed massive tax increases of 28 cents, I believe, on gasoline. I am sure hon. members opposite remember what happened. The minister lost control of the House, was forced into an election, and was walloped in the election.
October 10, 1989

The Liberal party presented a set of coherent policies for Canada and won the election. The principal reason for that electoral victory, as hon. members opposite will well remember, was the vicious tax increases contained in the then Minister of Finance's budget. You will recall his expression: "Short-term pain for long-term gain". That is exactly what we are getting in this bill, but it is going to be a little longer term pain by the appearances of it because we will have, in theory, another three years more of this government to endure.
I say to the hon. members opposite we can cut short that period with a quick vote on this bill. Get rid of this bill and perhaps we will get of this government and save Canadians this kind of tax increase.


Some Hon. Members:: Hear, hear!


Peter Andrew Stewart Milliken: One would think that the gasoline taxes that were proposed in 1980 taught this government a lesson. It learned that Canadians did not want this kind of tax and they were prepared to vote the government out if they got the chance. I say to hon. members opposite that is exactly the position they are in today. We have more increases in the gasoline taxes in this bill.
The hon. member for Calgary Northeast has proposed that we delete the clause, including that particular increase, and I agree with him. We should vote this clause out. We should support the motions that he has moved, deleting a series of clauses from this bill.
If the government has to go to the people on this and if the people decide they want to pay more taxes on gasoline, so be it. Let us go to the people and have that decision made there. If the hon. members opposite are so confident that the people want all these tax increases, that they want this silent killer of jobs increased some more, that Canadians want to pay more for their gasoline tax and all the other taxes the government has proposed in this budget, let us go to the people and let them tell us about it in an election. If the government is so confident surely it belies it will win.
If it thinks it will win, why would it be afraid to go to an election? I know why it is afraid to go, Mr. Speaker. It knows it would lose. Those members would lose in droves.
Government Orders
We would end up not having to pay these taxes. That is what is going on over there. The hon. member for Calgary Northeast seems to be the only one, at least in public, who has recognized that fact and stand up on his feet and say so. Why do the others not stand up and defend these taxes? I know why. It is a subterfuge.
My friend for Bonavista-Trinity-Conception knows the answer as well as I do. It is a subterfuge. They are trying to say that since some of their members and everybody is opposed to this tax, when the vote happens, maybe Canadians will not be watching and they will not see us vote. They will see that the hon. member for Calgary Northeast who they all know is a good Conservative member was on his feet opposing it, and they will assume that the Conservative party therefore is opposed to these taxes and they somehow got adopted by the House by some mysterious technique-osmosis or something-and the House suddenly adopted the tax by happenstance.
We know who has proposed this tax. It was the Minister of Finance and the Conservative government led by the Prime Minister. We know who is supporting this tax. It is the members who are sitting behind that government on their hands today with their mouths shut, saying absolutely nothing to oppose these vicious measures.


Fred J. Mifflin: And they will be sorry for it.


Peter Andrew Stewart Milliken: And they will regret it. We will bring that message home. The hon. member for Bonavista-Trinity-Conception and I will make sure that that message is brought home, if necessary, in the ridings where the people have been led to believe that these taxes are the work of someone else. These taxes are the work of this government, $42 billion in increased revenue, the result of Conservative tax measures that have been introduced by this government in this House and passed with its majority.
If most Canadians realized how much more they were paying in taxes than what they were paying in 1984-and I suspect they have forgotten how low they were in comparison-then they would not have voted for this government in 1988.1 think this government would face a severe problem at the polls if there was an election held tomorrow, or, indeed, at any future time.

October 10, 1989
S. ft 31
I say to hon. members opposite: if hon. members cannot defend this policy, cannot defend these tax increases, at least have the courage to vote against them and get them out of here so we do not have to put up with them and impose them on the people of Canada who elected us to help them.


John R. Rodriguez: Mr. Speaker, I want to speak in support of the amendments by the member for Calgary Northeast. Earlier I asked for 20 good men and women members on the Tory benches. Well, we have one, so we just have 19 to go, and hopefully with several more days of debate on this bill we might get the 19 others.
I know it may occur to people watching to ask themselves why an NDPer would second the amendments of the Conservative member who moves these amendments to his government's bill on taxation. One reason is because he could not find anyone on the government side to second his amendments. He could not find anyone who at least was prepared to stand up and publicly state before the viewers of this Parliament, before the country, that in fact enough is enough. There is not one of them with his courage who is prepared to stand and say to his leader and those around his leader that they are not going to be played for suckers, that they are not going to just be there as trained seals and flap their flippers every time they get a fish thrown at them.


John Harvard: They are chickens.


John R. Rodriguez: My hon. friend says they were chicken. I do not want to insult them that way yet because I am hoping that we can get 19 more to vote with us. I do not want to bad mouth them; I want to give them a good opportunity to be persuaded and to find courage to reach deep down within themselves to speak up. This is the time when this country needs clear unequivocal spokespersons on this question of taxation, and taxation, and taxation. They need that.
I mention the fact that this government was tax crazy. The facts speak for themselves. In the most recent budget, the 1989 budget, for example, there is an increase in the sales tax on construction materials and equipment for buildings, going from 8 per cent to 9 per cent beginning January 1, 1990.
Then there is an increase in the sales tax on alcoholic beverages and tobacco products from 18 per cent to 19 per cent beginning January 1, 1990 and there is an increase in the sales tax on telecommunications and
programming services from 10 per cent to 11 per cent beginning June 1, 1989.
There is an increase in the sales tax on all other goods to which it applies, from 12 per cent to 13.5 per cent, beginning June 1, 1989. There were several increases to the excise tax on tobacco products beginning April 28, 1989, and again on October 1, 1989, to a total of $4 per carton of cigarettes. Then there was an increase in the excise tax on gasoline by 1 cent a litre beginning April 28, 1989, and again on January 1, 1990, and a further 1 cent per litre increase in leaded gasoline beginning April 28, 1989.
We then have the shifting of financing from general revenues to premiums for regional extended benefits in the unemployment insurance program. That will add another $1.7 billion tax increase on payrolls. I see it is one o'clock, Mr. Speaker, and I would like to call it 1 p.m.


The Acting Speaker (Mr. Paproski):: The hon. member will have six minutes remaining in his debate after three o'clock this day.
It being one o'clock I do now leave the chair until two o'clock this day.
The House took recess at 1 p.m.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.

Mr. Lyle Vanclief (Prince Edward-Hastings):: Mr. Speaker, I rise in the House today to pay tribute to the Hastings-Prince Edward regiment who celebrated the one hundred and twenty-fifth anniversary of the origins of their regiment last weekend in my riding of Prince Edward-Hastings.
This regiment, known as the Hasty P's, mobilized in Picton in 1939 to enter the Second World War. This reunion also marks the fiftieth anniversary of this mobilization.
The Hasty P's were the most decorated Canadian regiment in the Second World War, receiving 31 battle honours, the highest being for the invasion of Italy under Lord Tweedsmuir of England. It is with great pride that I
October 10, 1989

pay tribute to this rural and small town regiment who earned distinguished recognition for their loyal service to Canada during the Second World War.


DISASTERS
Mr. Greg Thompson (Carleton-Charlotte):: Mr. Speaker, it is with great sadness that I rise today in this House to extend my sympathies on behalf of the people of New Brunswick to the families of the Thanksgiving Day accident in Cormier Village.
New Brunswickers were shocked to learn of the tragedy which struck the tiny rural community this past weekend. The Leger and McGraw family reunion is not unlike hundreds of such celebrations which take place in small towns and villages across this country where Canadians come together to share in and give thanks for the blessings bestowed upon them in the past year.
The tragic incident in Cormier Village serves to remind us all of the fragility of life, and I know I speak for all members of Parliament when I say that our prayers are with these families now and in the coming days.


PROPOSED GOODS AND SERVICES TAX
Leonard William (Len) Taylor: Mr. Speaker, on Saturday, October 7, Saskatchewan MLA Doug Anguish, from the constituency The Battlefords, and I held a public hearing into the proposed goods and services tax. We listened to the thoughts of our community and we were appalled at what we heard. The impact of the tax will be enormous on the people of northwest Saskatchewan.
We listened to briefs presented by 14 individuals and groups over a five and a half hour period. Every brief presented, including ones from the merchant's association, farm groups and the voluntary sector, opposed the goods and services tax and asked that we relay their message to the finance minister.
I am now writing a report based on those hearings and will be submitting it in the near future. I ask the Minister of Finance to listen to the people of Canada and to withdraw the GST.


NATIONAL PARKS
Mr.   Brian@: Mr. Speaker, Canadians from sea to sea are concerned about our environment. One of the most important ways of protecting our environment is through our national parks system. Alberta's national parks are among the most magnificent environmental reserves in the world.
It is an honour and a great privilege to represent a riding that has been named after one of Alberta's five national parks. Elk Island National Park is home to thousands of birds and animals including trumpeter swans, beavers, moose, elk, deer and bison.
The Minister of the Environment is committed to preserving our environment. Through the Canadian Parks Service Fund, Elk Island will receive $675,000 for essential facilities and services at campsites, interpretive exhibits, elk handling facilities and other major improvements. This support for Elk Island National Park is solid evidence that the Government of Canada is committed to protecting and preserving our environment.


Mr. Maurice Foster (Algoma):: Mr. Speaker, there is great concern in Canada's uranium mining and processing industry. The Government of Canada has proposed a plan whereby the Atomic Energy Control Board would provide its services to the industry on a cost recovery basis. This will have a serious impact on the workers, communities and companies whose livelihoods depend on a viable uranium mining industry.
There is little question that the Atomic Energy Control Board provides services which are essential in ensuring that proper standards of health and safety in the uranium mining sector are maintained. Nevertheless, these services are generally of benefit to Canadians as a whole, so taxing the industry directly for these services does not fairly reflect where the benefits are felt.

October 10,1989
The uranium industry is competing in a tough marketplace these days. The ability of our industry to remain competitive will be eroded if a cost recovery plan is implemented. It is much better that the industry's regulatory body continue to be funded from the general revenues of the Government of Canada. This way, there is no possible conflict of interest for inspectors whose services will be paid for directly by the companies. With the world price of uranium at an all-time low, the last thing the government should do at this time is place an additional burden of millions of dollars on the shoulders of this industry.


MEECH LAKE ACCORD
Mr. Guy St-Julien (Abitibi):: Mr. Speaker, the Hon. Member for Shefford (Mr. Lapierre) wrote to the Prime Minister of Canada (Mr. Mulroney) recently to suggest setting up a common non-partisan fund to save the Meech Lake Accord. The Prime Minister answered him right away that he would look very favorably on such an initiative, saying: "I hope that all those who really care about meeting the challenge of Canada will continue to work in the same spirit. Regaining our unity and developing our prosperity are essential conditions for Canada's present and future influence and standing. I think that we have made great progress in this regard in recent years, but if future generations are to realize their full potential, we must remove the constitutional uncertainty overhanging our future development, starting today."
Mr. Speaker, the answer from our Prime Minister strengthens our hope that the present obstacles will be smoothed out.


DISASTERS
Mr. Fernand Robichaud (Beausejour):: Mr. Speaker, a tragic event has shaken the whole riding of Beausejour, especially the community of Cormier Village. A fatal accident left 12 people dead and 45 others injured, of whom 7 are in serious condition. This accident is even more tragic because it decimated two families in Cormier Village, the Legers and the McGraws, at their annual gathering. In the face of such a tragedy, it is difficult to find words that really express how we feel. Nevertheless,
Mr. Speaker, I am sure that you join me and all other Hon. Members of this House in our prayers for those who are in serious condition, while we wish the other injured people a speedy recovery.
And I am sure too, Mr. Speaker, that you join all of us in this House in offering our sincere condolences to the Leger and McGraw families and wishing them the courage they will need to come through this difficult period.


TRANS-CANADA HIGHWAY
Mr. Bill Casey (Cumberland-Colchester):: Mr. Speaker, I welcome the announcement of the Minister of Transport of a royal commission on transportation in Canada. In the meantime, I urge the Minister of Transport to negotiate a separate agreement with the Province of Nova Scotia which would expedite the upgrading of the Trans-Canada Highway between Amherst and Truro.
The cutbacks of CN in Newfoundland resulted in substantial additional highway traffic through Nova Scotia, and the recent VIA announcements will result in even more traffic. This is an acute situation with certain sections of the highway experiencing accident rates sometimes four times the norm and all too often resulting in fatalities.
Nova Scotia is unique by design in that we have only one main highway into and out of the province which accommodates all the traffic for Nova Scotia as well as Newfoundland. An upgrading of this thoroughfare is absolutely essential.


VIA RAIL
Rodney Edward Murphy: Mr. Speaker, on Friday the Minister of Transport rose in this House and tried to justify cutting VIA Rail by 50 per cent across the country by quoting the 7 per cent ridership occupancy rate on one particular train on the Waboden-Churchill run.
What he did not tell this House was that this is not the regular passenger train, it is the way-freight. What he did not tell this House is that this Churchill train is an old combination coach and baggage car built in 1928, with wooden seats and with a thin partition separating passengers from freight. There is no food or beverage
October 10, 1989

service whatsoever. The train is always late because it is a freight train.
What the minister also did not tell this House is that it takes over 33 hours to go from Waboden to Churchill on this particular run. He did not tell this House that there is no place for the passengers to sleep. They are kicked off the train overnight and the station is closed.
The minister ignored the regular passenger train on which, during the tourist season, seats and sleeping accommodations are often impossible to come by. By wantonly using ridiculous aberrations, the minister is clearly demonstrating the obvious. He is not telling the truth to the people of Canada. VIA Rail needs a new conductor. The minister must go.


NATIONAL FIRE PREVENTION WEEK
Mr. Rob Nicholson (Niagara Falls):: Mr. Speaker, this week, October 8 through 14, has been proclaimed National Fire Prevention Week. The theme this year is: "Big fires start small. Keep matches and lighters in the right hands". This theme was chosen following findings which indicate that one of every seven school children has recently played with fire, and that children playing with fire is the leading cause of fire deaths among veiy young children.
Canadians this week and throughout the year are invited to involve themselves in fire safety prevention measures and are reminded to take extra precautions at home to prevent children from having easy access to fire starting materials. As Saturday, October 14, marks Fire Service Recognition Day, I am sure that all members present and indeed all Canadians would like to join me in saluting the dedication and effectiveness of the members of Canada's fire service.


PROPOSED GOODS AND SERVICES TAX
Jean-Robert Gauthier: Mr. Speaker, the Minister of Finance sometimes likes to quote me in the House and I wish to provide him with more quotations. For instance, I also said that this
Mulroney government is the worst thing that happened to the Canadian people since World War II.

I would like to quote the Minister who said in the House on March 8, 1984: "We will reduce spending. We will avoid raising taxes which are already too high".


An Hon. Member:: Who said that?


Jean-Robert Gauthier: The Minister of Finance!
He did not keep his promise. The Minister increased spending and raised taxes thirty-one times. Even worse, he is about to have Parliament approve a 9 per cent tax on goods and services. Mr. Speaker, this new tax is unfair and inequitable. It will cause particular hardship for low-and middle-income families.
The provinces are aware of the financial circumstances of Canadian families. That is why they do not tax food, and most provinces have no tax on clothing, or if they do, they tax at a very low rate. The Mulroney Government wants to tax these vital necessities as well. The goods and services tax is an anti-family tax. I think the Minister of Finance could use a new slogan, and I will quote one from a statement I made recently. It is: "What is good for the Conservatives is bad for Canadians".


NEW DEMOCRATIC PARTY
Mr. Felix Holtmann (Portage-Interlake):: Mr. Speaker, the hon. member for Esquimalt-Juan de Fuca is stumbling at the starting gate in the NDP leadership race and some of his star-struck colleagues are embracing him as the latest hands-on favourite.
I want to caution westerners, especially of the leftist, socialist persuasion, of the legacy of this three-year wonder as premier of the province of British Columbia. This is a man who doubled the salaries of the premiers and the MLAs as his first order of business. This is the man who said, when asked about borrowing money from a foreign country, "I am not here to pass moral judgment on the world, a buck is a buck". Does this mean that he would advocate doing business with South American drug barons or Libya or South Africa?

October 10, 1989
Oral Questions THE ENVIRONMENT


Mr. Brian L. Gardiner (Prince George-Bulkley Valley):: Mr. Speaker, the environmental challenge facing all Canadians impacts especially on the workers whose livelihoods depend on our forests. Last week at the IWA conference in Vancouver, delegates debated and passed resolutions recognizing the importance of the environment, and called for policies that stress fighting wasteful logging practices, boosting research and development, an aggressive program of replanting trees and equitable land use policies. A resolution to have a union-wide referendum to approve an environmental fund also passed.
All too often, the workers in the forest get squeezed in resource conflicts by industry and government. As one delegate said about our forest resource, "I too am an environmentalist. My job depends on it."


CANADIAN WHEAT BOARD
Mr. Larry Schneider (Regina-Wascana):: Mr. Speaker, today I would like to recognize an organization which works tirelessly in the best interests of western Canadian farmers, the Canadian Wheat Board. The Canadian Wheat Board has always been active in finding new markets and expanding existing ones.
Presently, the Wheat Board markets western Canadian grains to over 60 countries throughout the world. During the last four years, the enormous export subsidies of the United States and the European Economic Community have made the job of the Canadian Wheat Board much more difficult. The fact that the 1988 harvest was very small made a bad situation even worse.
Despite the adverse conditions, the Canadian Wheat Board has done an excellent job of protecting our position in the international market-place. With grain production much improved on the prairies, I am sure they are looking forward to the challenges of the future and will meet them successfully as they have in the past. I am confident that the Canadian Wheat Board will remain the cornerstone of the western Canadian grain marketing system.


MUNICIPALITIES
Mr. Eugene Bellemare (Carleton-Gloucester):: Mr. Speaker, last Tuesday I had the privilege to preside over the national Liberal task force on municipal infrastructure. Every Canadian is entitled to clean water, fresh air, adequate sewage systems, safe bridges and good roads.

However, as far as I could see from representations made by municipalities in the Ottawa-Carleton region, municipal infrastructures are in a deplorable state and need federal funding.

I believe that all levels of government have a commitment to improve our infrastructure. It is unrealistic to expect that the financial burden of infrastructure management should be borne by the local municipality alone, whether it is within the Ottawa region where the federal government gets a near free ride because of its heavy usage of local infrastructure or anywhere else throughout the country.

I therefore ask the Government to immediately acknowledge the importance of maintaining urban infrastructures by providing financial support to Canadian municipalities.



ORAL QUESTION PERIOD


Right Hon. John N. Ihrner@Leader of the Opposition: Mr. Speaker, I have some questions for the Prime Minister relating to his upcoming international trip. Four years ago on October 28, 1985, the Prime Minister said this to the United Nations in its General Assembly meeting:
If there are not fundamental changes in South Africa, we are prepared to invoke total sanctions against that country and its repressive regime. If there is no progress in the dismantling of apartheid, our relations with South Africa may have to be severed absolutely.
October 10,1989

That was what the Prime Minister said to the United Nations four years ago.
At the Commonwealth Conference in Malaysia next week, does the Prime Minister finally intend to honour his word and to indicate that Canada really will invoke total sanctions against South Africa? Will he use the influence of his office and Canadian public opinion to persuade other Commonwealth leaders, including Prime Minister Thatcher to the same thing? Is four years not long enough for the Prime Minister to keep his word?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, I think leaders of the front-line states, for example, would be somewhat surprised by the question of my right hon. friend because there is general recognition in the Commonwealth, particularly in the front-line states but also in many areas of the industrialized world, that the Commonwealth and Canada have provided very vigorous leadership in the fight against apartheid which began in earnest some four or five years ago.
Canada has taken some 50 initiatives, many of which have been followed by other industrialized nations. We are satisfied that the growing impact of these sanctions and policies has had a beneficial effect on developments in southern Africa: the results in Namibia, the developments in Angola, the election of President de Klerk and his recent visit to Zambia which would have been absolutely inconceivable some two or three years ago, his statements on the record of his desire to bring about fundamental change. All of this means for us that we have to maintain the pressure that Canada initiated, along with others, in the Commonwealth some four or five years ago.
I take the comments of my right hon. friend as an encouragement to intensify the procedures and the policies adopted by this government some five years ago to bring about desired change in South Africa.


John Napier Turner: Mr. Speaker, also on the record four years ago before the United Nations are the words "dismantling of apartheid" and "our relations may be severed absolutely". I note with concern the government's change in vocabulary in recent weeks. The government used to talk about abolishing apartheid, now it talks about reforming it. With great respect, no blacks
Oral Questions
were allowed to vote in the last South African general election.

Mr. Speaker, about the meeting of Commonwealth heads of government, I would like to get back to the question already before the House, the issue of China. Following the Beijing massacres, the Government declared that we could no longer act as if nothing had happened. However, on September 26, the Secretary of State for External Affairs, speaking on behalf of Canada, made his comprehensive speech before the annual United Nations general Assembly, and failed to say anything about China, not a word!
Could the Prime Minister explain this flagrant omission? Can we act as though nothing happened in China? Has our policy changed since the House passed a unanimous resolution condemning the events in China? Will the Prime Minister respond to the wishes of Parliament and table a resolution at the Commonwealth conference, demanding collective action against China?


Martin Brian Mulroney: Mr. Speaker, since the events, Canada's policy towards China has been to take a severe approach entirely appropriate to the circumstances. The Secretary of State for External Affairs has in no way departed from this policy which arose from the Chinese Government's brutal treatment of its people a few months ago.
In the House, the Minister stated clearly what our policy would be, a policy that is basically similar to that adopted by many large industrialized countries, and we have been consistent in implementing that policy. We wanted to send a clear message to the Chinese government, but on the other hand, we also wanted to maintain our links with the Chinese people, because all Canadians will benefit from maintaining the bridge that exists between the Chinese people and the Canadian people.
So that is the challenge we had to face, and I think we have faced this challenge successfully, in the interests of all Canadians.


John Napier Turner: Mr. Speaker, in response to an overwhelming expression of Canadian opinion reflected in the unanimous resolution of the House of Commons, the Secretary of State undertook to us and to Canadians that there would not be business as

October 10,1989
Oral Questions
usual with the current leadership in China. I share with the Prime Minister his view that our quarrel is not with the Chinese people but with the current leadership, but the action of his government since that resolution has not lived up to the undertaking given to the House.
Following the Commonwealth Conference, the Prime Minister is travelling to Central America, so I would like to ask him about the Organization of American States. The Prime Minister has speculated about the possibility of Canada joining this organization. As this would represent a shift in Canadian foreign policy and indeed, a shift in the foreign policy of his own government, would it be the Prime Minister's intention to allow a parliamentary hearing to test Canadian opinion on this matter before he makes any announcement?


Martin Brian Mulroney: Mr. Speaker, obviously a committee of this House is free and unfettered in its ability to investigate any policy of this government, or to make any recommendations of policy.
For my part, in response to the question of my right hon. friend, I have been troubled for some time by the absence of Canada from any direct role in hemispheric affairs. There are few organizations that deal with this, the OAS being one of them. While Canada has been very active in Europe, in the United Nations and in organizations around the world, as a matter of deliberate government policy over many decades now, Canada has been absent from what could be an influential role in the Organization of American States.
Clearly, there are downsides to every decision. Each decision carries with it difficulties for the future. However, and I will be speaking of this in the days to come, I believe that Canada has a larger and a more beneficial role to play in the hemisphere. This government plans to pursue all avenues that will allow us to play that kind of productive role.


PROPOSED GOODS AND SERVICES TAX
Mr. Douglas Young (Gloucester):: Mr. Speaker, there is one message that is ringing out loud and clear across the country for many in the workforce. Again today we have
heard from labour leaders across the country who have stated unequivocally that workers in Canada will not play patsy as the government wages war on workers.
My question to the Prime Minister is very simple. We now know that the goods and services tax is going to increase inflation, lower the standard of living, and at least maintain interest rates where they are if not increase them. In the face of all of that, and in view of the unequivocal statement by labour across Canada that they will not become involved in wage moderation when in fact we know there will not be price moderation, is it the intention now of the government to withdraw the goods and services tax proposal and go back to the drawing board as is being recommended by people across the country?


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, one message that comes through pretty clearly in the hearings and in things that I have heard from a number of other people is that we should not be withdrawing this tax. I think the hon. member himself said back in the summer that this was the right way to go. Yes, the hon. member had some differences but he felt it was the right way to go to move from the existing 13.5 per cent manufactured sales tax to a 9 per cent goods and services tax.
The hon. member made specific reference to the importance of ensuring that we do not get an inflationary impact from the implementation of the goods and services tax. What we are asking Canadians to do here is to accommodate a 1 per cent negative impact on their income as a result of the one-time only inflationary impact as a result of the goods and services tax.
Let us put that in perspective. There has been an 11 per cent increase in real disposable income after tax, that is disposable income after tax and after inflation since 1984-85. Putting it in that perspective, I believe that the position the government has taken is a realistic one.


M. Douglas Young: Mr. Speaker, Canadians understand the Governor of the Bank of Canada is saying once again he will keep a weather eye out for wage demands and ignore prices, and that is why I will
October 10, 1989

repeat my question to the Minister of Finance or the Prime Minister.
Since Canadians are being asked to accept a drop in their standard of living, do you seriously think that women and men working in Canada today will agree to moderate their wage demands, now we know the Governor of the Bank of Canada is only going to watch wages and not prices? As far as I can see, the message is quite clear: Canadian men and women will not play along!


Michael Holcombe Wilson: Mr. Speaker, let me just draw the attention of the House to the fact that most of the economic analyses have all agreed that there is a very important long-term benefit from the introduction of the goods and services tax; more jobs, higher growth, less inflation, greater productivity. This is widely agreed upon by the various think tanks.
The big question is whether we get this immediately in year one. Our analysis shows 35,000 new jobs in year one and 60,000 new jobs in year two. There are some very major economic benefits here if Canadians, both business and labour, do not act in such a way as to generate an inflationary impact. I have been saying, and others have been saying to business people, "Use restraint with your pricing and also use restraint in wage negotiations to make sure that we can avoid this inflationary impact and bring forward those major economic benefits as soon as we can".


CANADA-U.S. FREE TRADE AGREEMENT
Hon. Edward Broadbent (Oshawa):: Mr. Speaker, my question is for the Prime Minister. A year ago this month the Prime Minister said with reference to the Canada-U.S. Trade Agreement, that if the consequences of this deal were bad, that it was "cancellable on six months' notice".
According to figures released by the Canadian Labour Congress today-


Some Hon. Members:: Oh, oh!


John Edward Broadbent: Wait for the question. The most recent data it has prepared indicates that there have been some
57,000	jobs lost. Does the Government of Canada agree with these figures, and if not, will it produce its own evidence by which Canadians can make comparison with
Oral Questions
its studies and those that have been done outside the government?


Martin Brian Mulroney: Yes, Mr. Speaker, I can produce figures that were released on Friday by Statistics Canada which indicate that unemployment in Canada has dropped to 7.3 per cent. It has not been lower since August 1981.


Some Hon. Members:: Hear, hear!
It indicates as well that there have been 189,000 new jobs created in Canada since January 1, 1989, when the free trade agreement came into effect, 86 per cent of them full-time.


Some Hon. Members:: Hear, hear!


John Edward Broadbent: Mr. Speaker, the Prime Minister knows that there are still over one million Canadians unemployed and that notwithstanding the braying in the back-benches of his own party if the studies done outside the government are correct unemployment would be that much lower if we did not have the trade deal. That is what that is all about.


Some Hon. Members:: Oh, oh!


John Edward Broadbent: Once again the Conservative caucus demonstrates its lofty level of intelligence, but I leave that with the people of Canada.
When the Prime Minister made the claim last fall that the deal would be cancellable on six months notice, presumably he intended the people of Canada to believe his government would conduct its own studies to have a serious assessment of the effects of the trade deal. It could mean nothing else for a serious person. If the Prime Minister and his jackals here want to contend figures outside the House, why does the government not have the integrity to produce its own studies for the people of Canada on this?


Martin Brian Mulroney: Mr. Speaker, the free trade agreement took effect on January 1,1989. It is of course difficult for anyone to evaluate the full effects in such a short period of time, on one side or the other. I think my friend would acknowledge that. It will probably take somewhat more time before any objective observer can come to a definitive judgment. And I could understand my friend's question if, since January 1, 1989, Canada had lost
189,000	jobs. But we did not lose any, we created 189,000 new jobs in Canada. That seems to suggest to me that by and large the general economy, including the implica-

October 10,1989
Oral Questions
tions of the free trade agreement, are having beneficial results in Canada.


John Edward Broadbent: Mr. Speaker, the Prime Minister knows full well that every year since the Second World War there have been thousands of new jobs created. That is not the issue.


Some Hon. Members:: Wrong, wrong.


John Edward Broadbent: The serious issue, and I would hope the Prime Minister would be serious about it, is whether we would have more jobs that have been created, created, had we not had the trade deal. That is what a serious study would tell us and that is what the government should be up to.

The Prime Minister knows perfectly well that during the weekend, the Minister responsible for Agriculture admitted in a speech in Quebec that ever since the trade agreement was signed, the results for Canada had been very negative in his Department, and this applies to pork, beef, sugar, fish and other products. According to this study, we have now lost nearly 60,000 jobs in the manufacturing sector. If that is true, isn't this sufficient reason for the Government to terminate the agreement?


Martin Brian Mulroney: Mr. Speaker, the Minister of State)(Agriculture) is of course concerned about the tenor of certain gestures or decisions by the U.S. administration, in light of the FTA. Last week we had a meeting with executives of the UPA, the Minister of Agriculture, the Minister of State (Agriculture), the Minister for International Trade and myself, to discuss and analyse approaches to problems of this nature. Of course, one must be vigilant whenever a trade treaty is concerned, and the Minister is trying to do so. The Hon. Member quoted from a document. I could mention another document that was published this morning. This is a report from Germany, datelined Munich.

"Premier Frank McKenna of New Brunswick told West German businessmen yesterday that the U.S.-Ca-nadian free trade agreement has opened up major (new) market opportunities and urged them to invest in his province."


Some Hon. Members:: Oh, oh!


Some Hon. Members:: Hear, hear!


Martin Brian Mulroney: Obviously, Premier McKenna, one of the distinguished Liberals in this country-maybe the only one-certainly, relatively speaking, a visionary Liberal-


John Edward Broadbent: On Meech Lake?


Martin Brian Mulroney: On commercial matters-has indicated a matter that I think my hon. friend will agree benefits New Brunswick. The associate Liberal finance critic from New Brunswick would agree, I am sure, that his former Premier and leader speaks very eloquently for New Brunswick in terms of economic matters. Therefore, I am sure a lot of Liberals will want to support him.


Hon. Lloyd Axworthy (Winnipeg South Centre):: Mr. Speaker, I have a comment on the Prime Minister's last statement. I wonder if he applies that sense of vision to the Premier of New Brunswick on constitutional matters as well.
The Prime Minister has made some use of figures on this issue, and I think there is a matter of division in the country. Why is it that in the Statistic Canada figures he quoted that the number of full-time jobs fell by 36,000 in the last month and that the job figures as compared to last year are down by 30 to 40 per cent?
Does that not begin to show that there has been a serious loss of jobs as a direct consequence of the trade agreement? If the government is disregarding those figures, why is it afraid to publish its own? Why is it afraid to come forward with its own score card as to the impact of the trade agreement as promised by this government in the election?
I ask the Prime Minister directly: Will the government publish now its studies and reports on the consequence of the trade agreement so that Canadians can finally know the truth?


Martin Brian Mulroney: Mr. Speaker, the figures are there as published by Statistics Canada. Since 1984 there have been 1,535,000 new jobs created in Canada.


Mr. Allmand:: Since last year.


Martin Brian Mulroney: My hon. friend says: "since last year". Since November 1988, since the election involving the free trade agreement, there are 205,000 new jobs created in Canada. There were 5,000 in Newfoundland, 4,000 in Nova Scotia, 85,000 in Ontario, 27,000 in Alberta, and
84,000	in British Columbia. In fact this year more than 55 per cent of all the new jobs created in Canada have been
October 10, 1989

created in western Canada and that too is a sign of economic and social progress.


Lloyd Axworthy: Mr. Speaker, the Prime Minister is still fudging the answer. He is not giving the figures because he knows full well that the report shows that there were less jobs created this year than there were last year and that the full-time jobs are substantially down this year over the last year. It does not take an economic genius, which the Prime Minister is not, to figure out that the free trade agreement is having a negative effect.
We simply want to know when this government is going to live up to its commitment and promises to provide this country with the proper figures and proper adjustment programs so that Canadian workers will not be victimized by this agreement but will be helped by this government because of the free trade agreement's negative effect of loss of jobs that other groups can clearly see.


Martin Brian Mulroney: Mr. Speaker, from 1984 to 1988 Canada had the largest percentage growth in employment of any G-7 country: Canada's was 12 per cent, the United States was 9.5 per cent, the United Kingdom 7.5 per cent and so on. Since the free trade agreement has come into effect, there have been 189,000 new jobs created and the member for Winnipeg says we have lost jobs. There have been 189,000 new jobs, but perhaps my hon. friend would want to go on the record with some information that was provided by the finance department and the Bank of Canada. Since 1984 and 1988 more jobs were created in Canada than in the following countries put together: West Germany, France, Sweden, Belgium, Greece, Finland, Ireland, New Zealand and Austria. That is a record of job creation that my hon. friend should be applauding.


FINANCE
Hon. Bob Kaplan (York Centre):: Mr. Speaker, my question is for the Minister of Finance. Over the weekend it was revealed that the Minister of Finance and the Information Commissioner are in a lawsuit over the minister's refusal to release departmental documents which would show whether the minister was telling the truth about Tory campaign promises during
Oral Questions
the election. These were departmental estimates on interest rates and on the deficit.
The minister has never claimed, nor have his officials, that these documents are entitled to exemption from disclosure, and they are not entitled to exemption from disclosure. On the contrary, in July and in September his officials told Iain Hunter, a reporter from The Ottawa Citizen that the documents were ready for release and in the minister's hands.
Is the minister prepared to obey the law, to end this senseless lawsuit, both sides of which are being paid for by the taxpayers, and to make these documents public today?


Michael Holcombe Wilson: Mr. Speaker, there is no lawsuit. We have been working hard on developing the information that Mr. Hunter of The Ottawa Citizen has required.
I would say to him and I would say to the House today that we have every intention of providing the applicant with the information that he is entitled to under the act?


Robert Phillip Kaplan: Mr. Speaker, according to the Information Commissioner, the Government's and the Minister's failure to provide this information is in itself a violation of the Act. Again, I want to ask whether the Minister is now prepared to admit that the only reason for the delay, on two occasions, maybe three, is that the documents reveal that the Government's statement during the election campaign were false?


Michael Holcombe Wilson: Mr. Speaker, my answer would be the same as I gave to his previous question.
It has taken a while to pull this information together, but when the information is completely pulled together we will provide all the information to Mr. Hunter that he is entitled to under the act.


UNEMPLOYMENT INSURANCE
Ron Fisher: Mr. Speaker, my question is for the Prime Minister. During the last election campaign we heard a lot of promises about adjustment programs geared to cushioning the negative impact of the free trade deal. News reports today say

October 10, 1989
Oral Questions
that 50,000 to 60,000 people have already lost their jobs as a direct result of the free trade deal.
The only adjustments I see being made are adjustments to the Unemployment Insurance Act. Would the Prime Minister confirm that the only adjustment program he has is cut-backs in unemployment insurance so that the unemployed workers themselves can pay for the training of other unemployed workers?


Hon. Barbara McDougall (Minister of Employment and Immigration):: Mr. Speaker, the figures that came out today are not the figures that I explained to the member in committee last week. The figures that came out today are not in line with what the future of this country is and they are not in line with what is the labour force development strategy.
The labour force development strategy will provide $800 million more. It will be paid for by employers and employees, not by the unemployed who will have a far stronger chance of building a better future because they will have more job opportunities through Community Futures and through training for contemporary jobs. That is what workers in Canada have expressed to us that they want, through their application for our existing programs, because they want the training.


Ron Fisher: Mr. Speaker, my supplementary question is for the Prime Minister as well. The only question I can ask in response to that answer is: will the Prime Minister go to Gaspe; will the Prime Minister go to Moncton, New Brunswick; will the Prime Minister go to the Avalon Peninsula and explain to the 10,000 people in the Avalon Peninsula why they are going to be cut off from unemployment insurance if Bill C-21 passes?


Barbara Jean McDougall: Mr. Speaker, let me say first of all that the opportunities to upgrade skills are going to exist all across Canada. I have just returned from a trip to Atlantic Canada where I explained our programs which were well received by the people with whom I met in New Brunswick.
There is a demand for skilled labour in all parts of Canada, including Atlantic Canada. I met with all of our Community Futures managers there from across Atlantic Canada and they understand perfectly well what we are trying to do and they support it.


Felix Holtmann: Mr. Speaker, my question is also to the Hon. Minister of Employment and Immigration. As a result of the base closure at Portage La Prairie and others, the minister heads a cabinet committee to deal with the negative impact of unemployment and economic losses to the area.
Will the minister guarantee adequate funds for the new economic opportunities office that she has opened there, about $2 million, in view of the fact that we are saving $450 million on defence.


Barbara Jean McDougall: Mr. Speaker, I want to thank the hon. member for his continuing interest in his community.
My officials have been meeting with community representatives, with employers and with workers in the area. Through the Office of Western Economic Diversification new jobs are already being created in the Portage area. There were 90 new jobs in product development and assembly at Western Combine Corporation in Portage. We are funding this store front office to help people in the community take advantage of new opportunities, and that is how the people in the community see it.


Mrs. Marlene Catterall (Ottawa West):: Mr. Speaker, my question is for the Prime Minister. On VIA Rail cuts the government is saying no public hearings. On the GST the government is saying it is going ahead no matter what the public says.
Now on unemployment insurance the government is ignoring everything that has been said right across the country about the devastating effects of Bill C-21 on the unemployed and on their communities and is ploughing ahead with this disastrous bill. Is there anything on which the Prime Minister and this government are prepared to listen to Canadians?


Barbara Jean McDougall: Mr. Speaker, let me point out that on the labour force development strategy, in response to some of the things that were said in the committee, we have come out with some amendments which I thought the hon. member supported.
October 10, 1989

As well, in terms of the growth in jobs that are going to be created as a result of the Community Futures and as a result of the training, that is something this government stands behind.
I would also remind the hon. member that the Liberal government in 1977 changed the entrance requirements as well. We intend to stand by our changes.

Mr. Francis G. LeBlanc (Cape Breton Highlands -
Canso): Mr. Speaker, my question is directed to the Minister of Employment and Immigration, who is ignoring the views expressed in four weeks of testimony on her bill across Canada. Doesn't she realize that the cuts in unemployment benefits will impoverish thousands of Canadian unemployed and devastate the economies of so many small communities across Canada which depend on seasonal industries?

Is not the Minister really telling the unemployed in rural Canada with this bill: "move or starve"?


Barbara Jean McDougall: Mr. Speaker, quite the contrary. One of the things we did for seasonal workers, because we recognize the reality of this in parts of Canada, is that we took out the repeater provision which penalized seasonal workers. So we were paying attention to seasonal workers.
We are going to double the training money under this strategy and it is going to be very helpful to Canadians. I suggest that the hon. member help us decide what the training funds should be used for so we can help the people in his region as well.


Fred J. Mifflin: Mr. Speaker, my question is also for the Minister of Employment and Immigration. In Newfoundland there is growing uneasiness over the federal government's employment policy engendered by Bill C-21, the changes to the Unemployment Insurance Act. The emphasis on training for jobs that do not exist at the expense of jobs that do exist has the disastrous effect of forcing Newfoundlanders to move away from their home
Oral Questions
to find work. They can no longer rely on the traditional jobs available to them under the job development strategy.
Will the minister promise this House, and Newfoundlanders in particular, that she will show compassion and re-examine the proposed changes that will not work for other parts of Canada and that will be disastrous for Newfoundland?


Barbara Jean McDougall: Mr. Speaker, I think that Newfoundland, as the rest of Canada, deserves all of our help in terms of building an economic base from the ground up and providing the training that workers there need. There are skill shortages in Newfoundland as there are in other parts of Canada.
It is the strength of the Community Futures Program that starts in the community and defines those needs and those opportunities, combined with the training that we can provide, that is going to help people in Newfoundland as it is in other parts of Canada.


Fred J. Mifflin: Mr. Speaker, on a supplementary question I am going to quote the Prime Minister who said that clearly there is a down side to every decision. There is quite a down side to this. Let us face it: this is a bad bill.
If this sudden shift in policy makes so much sense, can the minister explain why the committee on Bill C-21 in its hearings across the country experienced about a 90 per cent rejection rate; 80 per cent vehemently opposed, 10 per cent opposed and the remaining 10 per cent confused, undecided and lukewarm at best?


Barbara Jean McDougall: Mr. Speaker, if the hon. member goes through the submissions that were made at the hearings, as I have, he should understand better that whereas there was some disagreement with some of the proposals from one side and there was disagreement with the other, we have labour and management for the first time in this country working together on what the training programs should look like. That is a real breakthrough for this country and for the kind of programs we are going to provide.

October 10, 1989
Oral Questions


CANADA-U.S. FREE TRADE AGREEMENT
Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, my question is for the Prime Minister. The Minister of State for Agriculture admitted this past weekend that since free trade came in in this country in fact there has been a decrease in the relationships between the United States and Canada so far as trade is concerned.
In view of this, what explanation can the Prime Minister give for allowing, contrary to law, American used cars into this country without meeting Canadian safety standards?


Hon. Benoit Bouchard (Minister of Transport):: Mr. Speaker, it is quite clear that as concerns used cars coming into this country from the United States, the Department of Transport has already proceeded with a series of changes in its regulations, especially for vehicles more than eight years old, and we intend to bring the Canadian market's regulations into line with Canadian safety regulations. I can give the House the assurance that as procedures are implemented, Canadian regulations will be brought into line, and that there is no way used cars coming in from the United States will not meet Canadian safety regulations.


Steven W. Langdon: Mr. Speaker, in fact this government said that safety standards would be respected for Canada in this entire arrangement with the United States. So I ask this government again: Why this reversal, why this decision to turn back this promise which was made to the Canadian people, why this decision to put the risk of Canadian safety on the bargaining table yet again?


Benoît Bouchard: Mr. Speaker, my friend knows that what he says is absolutely untrue. He knows that very well. He knows that, for example, we have changed the regulations for the metric speedometers and the bilingual fuel labels. At this stage with the existing U.S. safety standards we will soon replace the regulations in place with the notice of defect, and after 1990 all vehicles imported will be required to respect the Canadian rules. He knows that very well. I do not believe that it is sound to mix politics with safety.


Guy St-Julien: Mr. Speaker, my question is directed to the Minister of Regional Industrial Expansion.
The Canada-Quebec agreement on mineral development expires in March 1990. This agreement has met its objectives quite satisfactorily, but much remains to be done with respect to research and development in the mining industry in Quebec.
My question is as follows: Could the Minister confirm to the House today that he is currently engaged in talks with the Government of Quebec for the purpose of renewing the agreement for the next five years, so that the mining industry will survive? If not, when will talks begin with the Government of Quebec, with Mr. Bouras-sa's government?


Hon. Harvie Andre (Minister of Regional Industrial Expansion and Minister of State for Science and Technology):: Mr. Speaker, I can indeed confirm that we are in active discussions with the Government of Quebec in terms of our co-operative economic agreements. I am hopeful that now that the Bourassa government has been re-elected a new ministry will be in place and we will be able to make progress and sign the agreements in the near future.


COMMUNITY FUTURES PROGRAM
Mr.   Brian@: Mr. Speaker, my question is for the Minister of Employment and Immigration. The Lamont-Two Hills Community Futures Program is important to Elk Island. Can the Minister assure us that this program will continue and, if so, will she also assure us that the smallest possible amount of program funding will be spent on administration and bureaucracy and that the maximum possible support will go toward helping the small businessmen and our community?


Barbara Jean McDougall: Mr. Speaker, the Lamont-Two Hills Community Futures is a program that has been under
October 10, 1989

way for only a couple of years. As a young project it is already proving itself helpful. We would expect to see a transition from more administrative costs to more program costs as it progresses, because that has normally been the history of what has happened with community futures projects.


CANADA-U.S. FREE TRADE AGREEMENT
John Napier Turner: Mr. Speaker, in response to a question from the member for Essex-Windsor, the Minister of Transport again demonstrated a lack of familiarity with his own documents. He indicated that used cars under the free trade agreement would not be allowed importation from the United States unless they met Canadian safety standards.
I want to read from the regulatory impact analysis statement just produced this morning by this government which says:
The Motor Vehicle Safety Act currently prohibits the importation of motor vehicles prescribed by regulation that do not meet Canadian motor vehicle safety standards. Strict enforcement of these provisions will conflict with the intent of the free trade agreement as used vehicles from the United States will not necessarily meet all Canadian motor vehicle safety standards and thus cannot be imported.
Would the Minister spend a little more time in reading the background documents on VIA and on free trade before he spontaneously gives answers like that in the House of Commons?


Benoît Bouchard: Mr. Speaker, I suppose that the leader of the Liberal party had the document at the beginning of this session. It has been given to him by the member for Winnipeg.


Some Hon. Members:: Shame, shame!


Benoît Bouchard: Mr. Speaker, I will just repeat what I said. I said that we have changed regulations dealing with cars imported from the United States and we will continue to do that.
I said also that procedures have been developed that will require vehicles imported after 1990 to comply with Canadian standards when equivalent U.S. models may have different safety standards. That is what I said; that is what I repeat.
Privilege


John Napier Turner: Mr. Speaker, all that indicates is that the hon. member from Winnipeg, who is our trade critic, knows the documents produced by the government better than the minister does.
I want to suggest that it is becoming a habit that when the minister presents statements to this House and quotes government policy, when we get the documents the next day, as we did in the case of the regulatory impact analysis statement relating to the importation of used cars, among other goods, and when we got the statement produced by the president of VIA Rail, supposedly tabled in the House of Commons to support the minister's statements, the written documents in no way substantiate what he tells this House.


Benoît Bouchard: Mr. Speaker, I would prefer to use my documents rather than those produced in terms of employment by the member from Winnipeg. When he was the Minister of Employment and Immigration, we had the worst performance in terms of employment in this country.
I repeat what I said, Mr. Speaker. The documents I use as Minister of Transport are sound and very good documents. I prefer to use my documents rather than those produced by his party.


PRESENCE IN GALLERY
Mr. Speaker:: I wish to draw to members' attention the presence in the gallery of Mr. Adam Nowotnik, Vice-Minister of Fisheries, Shipping and Communications for Poland.


Some Hon. Members:: Hear, hear!


PRIVILEGE
Fernand Robichaud: Mr. Speaker, I wish to thank your for giving me this opportunity to raise a question of privilege of which I gave the Chair notice this morning. Last Friday, the Department of Fisheries and Oceans published a document under the title: Atlantic Fisheries Media Book. This document contains some information that was already available to the public and also information that is being published for the first time. This information is not and was not available to

October 10, 1989
Privilege
Members. The Minister took this opportunity to release the information directly to the media, without inviting or notifying Members.
As a Member of this House with specific duties as the Opposition spokesman for fisheries, I feel that my rights have been breached and that my role as the Official Opposition critic has been diminished. Especially, Mr. Speaker, since in this document, the Minister seems to paint a picture that is far more optimistic than the gloomy situation in our Atlantic fisheries. We know there is a serious problem with our northern cod. Quotas have been cut, plants have had to close, the herring fisheries are in serious trouble, and lobster, Mr. Speaker-


Mr. Speaker:: Order! I am reluctant to interrupt the Hon. Member. I realize he may wish to formulate a complaint, but I must say, in response to his statement, that this does not constitute a question of privilege. However, if the Hon. Minister wishes to respond, he may do so.


Hon. Thomas Siddon (Minister of Fisheries and Oceans):: Mr. Speaker, I am certainly pleased to respond to the concerns raised in the form of a question of privilege by my hon. colleague for Beausejour.
I am aware of a collection of information, I assume to be public information, which my Deputy Minister and officials have put together, summarizing the current economic performance, and the landings, the record of the fishery of recent years. I understand that that document has been used for the briefing of various members of the media, among others.
That document has not been made available to members of Parliament. I believe it to be based on public information. I would be most happy to make it available to all members of Parliament should that be the wish of the hon. member.
I would suggest, Mr. Speaker, that in no way has the privilege of members been breached in this manner.


Mr. Speaker:: First, other members may wish to rise. There is no particular need to do that because this is not a question of privilege. The hon. member for Beausejour has directed a complaint to the Chair. I am sure that given the response by the Minister, perhaps a discussion
would ensure that the complaint would not have to be brought again.
Hon. members will realize that a question of privilege is not the place to enter into a debate, no matter how legitimate or how difficult the issue is.
The hon. member for Ottawa-Vanier is rising on a point of order.


Jean-Robert Gauthier: Mr. Speaker, you will remember that since last Friday, we have changed the Standing Orders somewhat with respect to committees of the House. As you know, the Standing Committees of the House have all been reconstituted and are now in a new session, and to avoid having elections in all the committees, the House decided not to follow the customary procedure in the Standing Orders according to which each committee elects its chairman, vice-chairman and so forth.
Today, it seems we have a few problems as a result of the decision we made here on Friday, since the committee clerks will not accept the lists of replacements for members of the various House committees, which may cause certain problems when we want to be replaced or have to be in two locations at the same time. Mr. Speaker, to deal with this situation and avoid any problems as a result of the fact that members have not had time since this morning to submit their lists of replacements, I wish to move, having consulted with the Government and the New Democratic Party, the following motion which reads as follows:
That the list of replacements for members of Standing
Committees, in effect on October 5, 1989, in other words, last
Thursday, remain in effect, where appropriate, until October 17,
1989. '


Mr. Speaker:: The House has heard the terms of the motion. The hon. member for Ottawa-Vanier is clearly putting a motion which would require consent of the House. There seems to be some indication that he has that consent. Is it agreed?


Some Hon. Members:: Agreed


[Stage Direction]
Motion agreed to.
Mr. Speaker:: When the House rose at one o'clock, the hon. member for Nickel Belt had the floor.
October 10, 1989



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of Bill C-20, an act to amend the Excise Tax Act and the Excise Act, as reported (without amendment) from a legislative committee, and on Motions Nos. 3, 6, 7, 8, 9, 12, 13, 14, 15, and 16 standing in the name of the hon. member for Calgary Northeast.
John R. Rodriguez: Thank you, Mr. Speaker. At that time I was speaking in support of the amendments put forward by the hon. member for Calgary Northeast on Bill C-20. I had pointed out that the facts show that this government is tax crazy. I listed and enumerated, since 1984, the tax increases that the government has brought about on the people of Canada and that in fact Canadians are fed up with the way in which this government has been reaching into their pockets, left pocket, right pocket and back pockets, and taking their hard-earned money from them.
At the same time, I think Canadians are thoroughly shocked by the way in which the government treats the wealthy in this country. It seems that Michael Wilson, finance minister, once said in a speech in Montreal: "The problem with Canada is that there are too few rich people". I do not see why they seem to think of it as their mandate to try and increase the number of rich people by taking from the poor to give to the rich. This is a new version of Robin Hood.
In fact, just to give you an idea of how people feel, these are ordinary folk-who express in their own way-the way they feel about this government and taxes, I have received a couple of letters in the last week from two diverse places, one from here in Ottawa. I will read parts of the letter into the record because I think it is apropos. It is written to me and it states:
Dear Sir:
We are quite concerned as seniors of middle-income means as to the possible impact the GST and claw-back on the OAS is expected to have on our group -
We were both born and raised in a low-income and hard-working milieu. We, however, studied hard, worked hard and struggled all our lives in order to better ourselves and thus achieve a reasonable,
Government Orders
comfortable life style for our children and ourselves. We planned for our retirement the best that we could on a middle-income salary. Suddenly, we find that these last two conservative governments are undermining all our efforts to ensure ourselves of a self-sufficient and decent life style.
We have corresponded with Mr. Blenkam regarding our grave concerns-
Good luck to them.
- only to receive the attached response.
The attached response is the same offhand dismissal that Mr. Blenkam has treated the people of Newfoundland, Alberta, British Columbia and northern Ontario to. If they are not from his income bracket, he just dismisses them. Nevertheless, this couple wrote to Mr. Blenkam thinking that he was the chairman of the finance committee, that somehow or other he is the person you write to, or at least he might listen.
The letter continues:
We are neither naive nor stupid enough to believe that we are not likely to be seriously affected by the proposed GST, claw-back of the OAS and God only knows what else this government may be proposing for the future to further undermine our financial status and thus our life style.
We hope and pray that members like yourself, Mr. Douglas Young, Mr. Lome Nystrom, to name a few, will continue to fight on our behalf and on behalf of people of the lower income levels. These two levels are the most vulnerable and least protected in Canadian society, yet the government is taking dead aim at them.
That is written very simply and from the heart. This gang seems to come from the head. They go from the head to people's pocket-books. This couple is writing from the heart, the way they have experienced it. They have worked all their lives and here comes this Tory government, acting like a Tory government. Of course we know the whole idea is to restructure the tax system so that the wealthy get off scot-free while you take it from middle and low-income Canadians.
Here is another letter from a couple of women in Lively, Ontario. It states:
Dear Mr. Rodriguez:
I am tired of the government doing what they want, everyone complaining and no one doing anything. I think the problem is that people feel helpless to fight the government and we don't know how to do it or what to do about it. We do not live in a democracy as we are led to believe. The government is far too powerful in this country.

October 10, 1989
Government Orders
Everyone I know was against free trade and it went through. The concerns of the common taxpayer are of no concern to the government. They do what they want and they aren't in a position to suffer from their decisions.
We work hard for our money and we aren't allowed to keep a decent portion of it. My husband works 10 hours a day, six days a week and we are always overdrawn at the bank, we do not have a new car-a 1980 small model-and we live in a small house. We don't drink, we don't go out except for the odd dinner out for a break and we all need clothes and other necessities. No matter how hard we work we don't get ahead.
Forgive me if my letter sounds bitter and hateful but I'm just so tired of the government and what it is doing to us. I thought I'd write and tell you how I feel and so many others feel the same way. They may not want to write because they feel it's hopeless, too. Can't you do something?
How could Tories sit over there and not respond to a plaintive cry for help as people are trod upon by this government which has no mandate to do what it is doing? None whatsoever, no mandate at all.
I want to say that we need 19 more Tories with courage, with guts, with backbone, not a wishbone where their backbone should be. We want them to stand up like the Member for Calgary Northeast, stand up and be counted.


The Acting Speaker (Mr. Paproski):: I regret that the Hon. Member's time has expired.


Ms. Catherine Callbeck (Malpeque):: I want to come back to the increased price of gasoline for a moment. The largest centres on Prince Edward Island, Summerside and Charlottetown, are both outside my riding. This means a lot of people in Malpeque have jobs in those areas and have to commute to work. The extra two cents per litre will mean that the average Island motorist will now pay at least $400 a year in federal and provincial taxes. It will mean that those who commute will have to pay double that amount, according to the Canadian Automobile Association.
That is the reality of rural living. That is what this means for the people of my riding. We have lost our VIA bus which means that 27,000 people who took the bus last year between Charlottetown and Moncton will now have to find another mode of transportation. This also is going to mean that we are going to have more cars on our overcrowded roads and more tax revenue going into government coffers.
While commuters face a tough time filling their cars with gasoline, including many who use car pools, the trucking industry is one industry that has really suffered and will continue to suffer as a result of this Bill C-20. Transportation firms have been asking the government to eliminate the excise tax because it discriminates against the long haul movements, thereby distorting regional economies.
A spokesman for Canadian Pacific said: "Transportation is a necessary input to virtually every business and service in this country". They maintain that by increasing the excise tax, which businesses cannot and will not be able to claim as an input credit, the government is discriminating against the trucking industry.
When the government imposes higher transportation costs as a result of the increase in fuel taxes, the basic price of goods, and therefore the tax paid on them, will be higher in places like Prince Edward Island. What this will mean is that people living in more remote regions will pay more tax than those living in central Canada. As my colleague from Yukon stated earlier this morning, this is simply unfair. This is not what I would call a balanced approach that takes regional considerations into account and imposes the heaviest burden on those who are most able to bear it, as the government claims.
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To sum up, Bill C-20 in my opinion delivers just the opposite of what the government is suggesting. I contend that by increasing the tax on gasoline and other goods and services this government is hurting the regional economies like Prince Edward Island and people with lower incomes, many of whom can be found in my riding.


Maurice Brydon Foster: Mr. Speaker, I am happy to have an opportunity to speak to Bill C-20 because it has two very important provisions in it, clauses 4 and 5, which relate to regional economies, as the hon. member from Prince Edward Island has just outlined, and the massive increase in the excise tax on gasoline of two cents last April and one cent on January 1.
The impact of that amounts to some nine cents a gallon and is a pretty hefty increase in the price of gasoline. It had a lot of distorting impacts across the country, particularly in border cities like Sault Ste. Marie where we have literally hundreds of thousands of cars every week lining up to go across to the United States to fill up their tanks with gasoline there. That is harmful to our economy and the industry in that community.
The same thing has happened in other communities such as Fort Frances and other border cities across the country. But that is only one impact. The amazing thing is that somehow that industry is able to have its gas delivered from Canada to the United States. It is 55 cents and 57 cents a litre on the Canadian side and it is something like 32 cents or 35 cents a litre on the American side. Yet it comes out of the same tank. A lot of that of course is due to this increase in the gas tax, so that is of great concern. But that is only one aspect.
The really harmful aspect, I think, is on tourism and on the cost of living in regional areas of our country where one has long distances of 40, 50 or 60 miles a day to travel to work in whatever industries are available for employment. I think that this is a very serious and unfortunate increase in the excise tax on gasoline. These amendments seek to correct that problem.
The second area is the removal on January 1 of the refund of the excise tax. There has been a provision that rebates could be provided to farmers, to loggers, to fishermen, and to other primary industry producers. For agriculture alone it is estimated that it will cost about $100 million in the first year, which will be 1990. I think

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this amendment which would strike down this proposed removal of the excise tax on gasoline is a very good move.
Clearly, farmers were required in the budget to provide almost $500 million. That covers everything from crop insurance to grain and flour transportation, to the rail branch line rehabilitation program, and to grain and crop advance payments programs, the bill that we were debating last week, Bill C-36. It includes the dairy export program to the tune of $12 million, the commodity-based loan program at $15 million and the Canadian Dairy Commission program. That amounts to $399 million. But the gas tax rebate system involves $100 million, bang, every year.
This amendment proposes to reinstate that fuel tax rebate system which has been so beneficial to primary producers. I would hope that the members on the government side might take a second look at this with a view to retaining it because the impact on agriculture alone will be tremendous.
There will be similar impacts on fisheries, loggers, and people in other primary industries, but clearly for agriculture, it will be extremely harmful if the government does away with that rebate provision.
We are hoping as well that the government will back down on the whole arrangement for advance payments. Every farm group in this country is opposing the removal of the advance payment provisions of Bill C-36, which was also provided for in the budget of last April. Clearly, that is a very harmful decision that the government is proposing to take at a time when farmers are taking off their crops which provides up to $30,000 of cash flow, so that the farmers are forced to deliver a crop at a time when there is a massive supply on the market driving down prices. Those two issues alone will involve the loss of millions and millions of dollars to the agricultural community.
I hope that the minister will take another look at this and consider accepting this amendment which I think will be very beneficial both to farmers and other primary producers.


The Acting Speaker (Mr. Paproski):: The hon. member for Calgary Northeast on a point of order.


Alex Kindy: I would like to withdraw Motion No. 9 standing in my name on the Order Paper as it deals with garbage disposal. I think the hon. member for Nickel Belt who seconded it agrees.


The Acting Speaker (Mr. Paproski):: It is no longer the member's, the motion belongs to the House. Therefore, we must have unanimous consent. Do we have unanimous consent to withdraw Motion No. 9 by the hon. member for Calgary Northeast?


Some Hon. Members:: Agreed.
Motion No. 9 withdrawn.


The Acting Speaker (Mr. Paproski):: Continuing debate with the hon. member for Winnipeg-St. James.


John Harvard: Mr. Speaker, I have been listening intently to the speakers before me. I have found their speeches stimulating and enlightening. I hope we do not hit a soft spot for the next five or ten minutes.
I think the member for Malpeque, Prince Edward Island scored some very good points talking about tourism and the effects of the increase in gasoline tax. Of course, the member for Nickel Belt can always raise the level in this House considerably with his sense of humour, but he also scored some very good points. He is the man who has been noting that there is a strange kind of silence from the other side of the House. After all, it is the government's measure. It is the government's proposal. This is what the Tories want to do to the Canadian taxpayers and yet there seems to be a conspiracy of silence from that side of the House, save one. I listened very closely to the hon. member for Calgary Northeast and the gentleman made a lot of good points. It is too bad that his colleagues on that side of the House do not listen to him more often.
As I was listening to the hon. member for Calgary Northeast, I thought there is a man who I would call a small "c" Conservative. I wonder where all the small "c" Conservatives have gone from that side of the House? Where are the small "c" Conservatives who believe in fiscal restraint? Where are the small "c" Conservatives who believe in fiscal responsibility? Where are the small "c" Conservatives who believe that the government should not be day in and day out reaching into the pockets of Canadian taxpayers and taking more and more? Where have all the small "c" Conservatives gone to? Mr. Speaker? Where is the party of Borden? Where is the party of Meighen, Bennett, Diefenbaker, and Stanfield? Where have all the small "c" Conservatives
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gone? I do not know. I can tell you one thing and that is that they are not over there. This has become the party and the government of big spending. This is the party that now believes in driving the countiy further into debt.
It is necessary to remember that this is the party which said that it would take control of the economy. Remember those Halcyon days of the Tories way back in 1984 when they excoriated Liberals from one coast to the other. They said that we were the big spenders, that we were out of control, and how they would do wonders.
Where is the countiy now? The Tories certainly have not gained control of the deficit? What has happened to the debt? The debt gets bigger. It gets bigger by the day. It gets bigger by the hour. It gets bigger by the minute. In fact, it was the hon. member from Calgary Northeast who pointed out that five long years ago the debt was $170 billion. Now it is somewhere between $340 billion and perhaps as high as $370 billion. If nothing unusual happens in the next three years because after all we do expect the government to be around for that long maybe the debt will surpass the $400 billion mark. Canadians are asking themselves whether they can take it. They are already answering the question. They cannot take it. They have said a number of times that they are fed up. They are fed up right up to their teeth.
I ask where the small "c" Conservatives have gone who believe in some of these old fashioned values about guarding against spending too much and making sure that revenues and expenditures are in line; they are sort of in rhythm. I can tell you that the government on that side does not seem to believe that.
In the past five years we have seen not 10, not 20, not 30, but 31 increases in taxes. We get more as a result of Bill C-20. Of course, the biggest one is yet to come, the big whopper. The government calls it euphemistically GST or the goods and services tax. Maybe some conservative propaganda writer thought that it would go down a little better if it were called the "goods and services tax." For I think for the average or ordinary Canadian, it is just another tax grab. It is just more money out of people's pockets.
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Canadians have said, and this has been demonstrated in many of the public hearings held by the House of Commons Finance Committee, that the goods and services tax will not do this country much good. Is the government listening? Does the government listen when the Conference Board of Canada says 72,000 jobs will be wiped out right off the top?
The Finance Minister himself admits that there will be an increase of inflation. It will be somewhere around 2.25 per cent. If you consider the inflation rate at 5 per cent and you add 2.25 on to 5 per cent, you are looking at an increase in inflation of around 50 per cent. I do not think that there are many Canadians who believe that we can take that kind of blow to the economy.
There will also be an increase in interest rates. An increase in inflation almost automatically leads to an increase in interest rates. The odd thing is that there is an increase in interest rates, it will follow that there will be an increase in the deficit. In the last eight to ten months the deficit has gone up because of the high interest rate policy of this government.
This government seems to go in many directions. On one side it talks about the deficit, we have to get it down. Yet, on the other side of the ledger the very thing that would exacerbate the situation, the veiy thing that would worsen the situation, is exactly the thing that the government does. One sometimes wonders what it is thinking about.
Government ministers talk over and over again about fighting the deficit. They ask all segments of Canadian society to do their bit. I heard the Minister of Agriculture allude to that the other day when he was talking about the need to change the legislation having to do with advance cash payments. This was the government's way of getting the Canadian farmer to do his bit in fighting the deficit. I consider that an insult. I do not think the Canadian farmer needs the Canadian government to stay up half the night thinking about ways of fighting the deficit. If there is anyone who knows anything about spending and fighting deficits it is the Canadian farmer. The Canadian farmer does not have to learn any lessons from this government. Now, of course, the government is going to increase the tax on telecommunications from 10 per cent to 15 per cent. I suppose hon. members opposite are now going to tell us that this is their idea of telling Canadian grandmothers and

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grandfathers who want to talk to their grandchildren that this is their way of fighting the deficit. Maybe, if we can just take a little bit more money from you when you dare call your family, that will be your way of fighting the deficit.
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Of course, it is a double whammy. Take more out of the taxpayer when it comes to making a phone call and then on the other side seniors are asked to pay more through the clawback. If you conducted your life well, if you worked hard, and if you retired with a half decent income, what does the government say? The government says you have been kind of naughty. You are earning too much money. We are going to take some of that back. In fact, we will take all of it back when it comes to old age security. Is that any way to run a country? Is that any way to treat people who have built this country, who have worked hard? Is that any way to treat seniors? I do not think so.
I do not think the government has the mandate, the right to impose these taxes. I ran in the election campaign last fall and I do not recall the Conservatives talking about a 9 per cent GST. I do not remember the Conservatives talking about increasing the manufacturers' sales tax another point and a half. After all, they had raised it from 9 per cent back in 1984, and now they want to push it up to 13.5 per cent. Did they talk about a 1 per cent increase in the telecommunications tax? No. I seriously wonder whether they have the mandate to do what they are doing.
In closing, that this is a nasty piece of legislation. There is only one place to put it-the garbage can.


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


Some Hon. Members:: Question.


The Acting Speaker (Mr. Paproski):: The question is on Motion No. 3 standing in the name of the Hon. Member for Calgary Northeast (Mr. Kindy).
Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


The Acting Speaker (Mr. Paproski):: All those in favour will please say yea.


Some Hon. Members:: Yea.


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


Some Hon. Members:: Nay.


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


The Acting Speaker (Mr. Paproski):: Pursuant to Standing Order 76(8) the recorded division on the motion stands deferred.
Motions No. 4 and 5 standing in the names of the Hon. Member for Yukon and for Calgary Northeast respectively, will be grouped together for debate but voted on separately.


Mr. Ross Harvey (for Ms. McLaughlin) moved:: Motion No. 4
That Bill C-20 be amended in Clause 3 by striking out lines 26 to
30 and lines 37 to 39 at page 2.


Alex Kindy: moved:
Motion No. 5
That Bill C-20 be amended by deleting Clause 3.


Nelson Andrew Riis: Mr. Speaker, I rise on a point of order. I simply want to say to my colleagues in the government and in the Official Opposition that we appreciate then-unanimous consent to allow the motion to be put other than in the name of the hon. member for Yukon, considering her other duties this afternoon.
Mr. Harvey (Edmonton East) Mr. Speaker, "a silent killer of jobs"-"a silent killer of jobs". That is how the Minister of Finance repeatedly has characterized the manufacturers' sales tax. In many respects, we on this side of the House agree with that assessment. It is, perhaps, a bit dramatic-"a silent killer of jobs"-but it is not inaccurate. The functioning of the manufacturers' sales tax has been shown, as is agreed on all sides of the house, to have a negative effect on manufacturing and consequently on manufacturing jobs in this country. So I think it is safe to say, at least to the best of my knowledge, that no member of this House supports the manufacturers' sales tax, certainly not in its current form. If there is any member of the House who wishes to rise now and say otherwise, I would be fascinated to hear it. But I would again say that to my knowledge, no one, not a single member of this House, supports the manufacturers' sales tax in its current form, assuming I can
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take the government members at the word of the minister.
This is all to the good, especially as the minister has resolved upon the course of spending $7 million of taxpayers' money to tell taxpayers about the wickedness of a tax which no one likes. It is not as if he had to convince people. However, he has resolved on this course, as well.
It is interesting to note that when the Conservatives came to power in 1984, the Government of Canada collected 19 per cent of their revenues from consumption taxes. With successive Conservative budgets, however, we see this total now boosted to 25 per cent of total government revenues. It has gone from 19 per cent to 25 per cent of total government revenues being collected from consumption taxes, and this in a mere five years. Imagine what the Conservatives will be able to accomplish should they be granted-the thought is almost too terrible to contemplate-a third term. However, I have every confidence that the Canadian people in their wisdom will see that that is precluded.
Not a budget has gone by without the kind of change we find effected in Bill C-20, Clause 3. Incredibly, the very hon. member of this House who has deemed the manufacturers' sales tax to be "a silent killer of jobs" is seeking in Bill C-20 to boost that tax by a factor of about 12 per cent. It is incredible.
The Minister of Finance advises this House to take a manufacturers' sales tax at 12 per cent and boost it to 13.5 per cent, an increase of about 12 percent. Again, I say, we are talking, in consequence of that increase, of additional revenues to the government from this hated manufacturers' sales tax of about $270 million. That is $270 million worth more of jobs presumably killed by this silent killer of jobs.
So I must confess there seems to be, I will not say hypocrisy-I cannot believe that the Minister of Finance is capable of blatant hypocrisy-but perhaps it would not be too unkind to suggest that there is perhaps confusion at work here, especially as not a single budget has gone past under this current Finance Minister's period in that position without a rise in the manufacturers' sales tax.
Adjournment Debate
Indeed, starting in 1984, when the Conservatives were elected and became the government of this country, the manufacturers' sales tax stood at 9 per cent. In their five short years in power the Conservatives have boosted this silent killer of jobs by 50 per cent. It is incredible. They say one thing, they profess one thing, and yet, oddly, they do another.
What conclusion can we draw from this? Are we perhaps to take the experience of having the Conservatives passionately saying one thing in this instance while doing the direct opposite and apply that to the other guarantees they are offering us with regard to the goods and services tax? Do you think, Mr. Speaker, it would be expedient for us to do that? I do. Because obviously any government capable of year after year after year raising the very tax which the Conservatives now say is a terrible thing that must be dealt away with is a government more than capable of taking an initial goods and services tax and, thereafter, year after year after year boosting it as well so that even if, as per Mr. Blenkam, we wind up with a GST initially introduced at 4.5 per cent, if the record on the manufacturers' sales tax is anything to go by, it will be 9 per cent within two years. And Lord knows where the escalation finally will stop, if ever.
The advice to this House, contained in Motion No. 4, to delete those sections of clause 3 of the bill which authorize the boosting of the manufacturers' sales tax from 12 per cent to 13.5 per cent are very well advised, and I commend them to the entire House because we, at least on this side, take seriously the assessment of the manufacturers' sales tax as "a silent killer of jobs".



PROCEEDINGS ON ADJOURNMENT MOTION


The Acting Speaker (Mr. Paproski):: It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the Hon. Member for Kamloops (Mr. Riis)-The Economy-Conference Board of Canada Report/National Sales Tax/Impact on Business Investment; the Hon. Member for Burin-St. George's (Mr. Simmons)-Fisheries-Impact of Free Trade Agreement

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on Atlantic Canada/Crisis in Atlantic Industry; the Hon. Member for Thunder Bay-Nipigon (Mr. Comuz-zi)-Transportation-Impact of VIA Rail Corporate Plan/Govemment Position.



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[Stage Direction]
The House resumed consideration of report stage of Bill C-20, an Act to amend the Excise Ikx Act and the Excise Act, as reported (without amendment) from a legislative committee, and on Motions Nos. 4, 5, 6, 7, 8, 12, 13, 14, 15 and 16 standing in the name of the hon. member for Calgary Northeast.
John R. Rodriguez: Mr. Speaker, my colleague for Edmonton East has presented very succinctly and very cogently the fallacy and the hypocrisy of a government that not so long ago was saying that the manufacturers' sales tax is this so-called silent killer of jobs, and yet they have not hesitated to prostitute themselves and take as much profits and money out of people's pockets as they can from this silent killer.
There is a lesson here to be extrapolated by the way in which the government has used the manufacturers' sales tax with all its warts and with all its problems. The government just uses it as a cash cow. It moved it from 9 per cent to now 13.5 per cent.
The government has used it to milk from the consumers of this country every buck it can get. It should make all of us quake in our boots, we should all shake in our beds, and shiver in our timbers-not all at the same time-but it should give us no ease to see how this government is moving.
In fact, there are 17 countries in the world that have put in a goods and services tax, some call it a VAT tax. Only one of the 17 to date has not increased the rate of that tax since it was implemented. The most recent example, the one this government, this Prime Minister, and this Finance Minister are constantly throwing into the faces of New Democrats, is the Government of New Zealand. The government of New Zealand introduced a goods and services tax, and I understand its Finance
Minister is here appearing before the Finance Committee as I speak giving advice. Here is a country that is giving advice to Michael Wilson, a country that introduced a goods and services tax in 1986 at 10 per cent. Today that tax is 14 per cent. It is not three years old and it is now 14 per cent. It has gone up 4 per cent in three years. This has got to be a symphony to the ears of Michael Wilson, the Finance Minister. He has dreams of sugarplums dancing in his head and it is not even Christmas Eve. This guy sees here the wherewithal to raise billions and billions of dollars.
To administer the present manufacturers' sales tax, the government has 1,500 bureaucrats. What did the Minister of Revenue announce the other day? The government is going to hire 4,000 more in addition to the 1,500. What happened to the 1,500? He did not make them disappear. The 1,500 has now increased by 4,000, even though we are abandoning the manufacturers' sales tax in the proposal, so we are still keeping the 1,500. You do not want to play poker with that guy, he would pick your pockets clean. So you have 4,000 and 1,500 which is 5,500 bureaucrats. I am sure the taxpayers out there are delighted to hear that hundreds of millions of dollars will go to pay the salaries of 5,500 bureaucrats who will pick their pockets.
This is a crying shame. This government sees the possibilities. It is projecting $25 billion from this goods and services tax. Everything from cribs to coffins, from condoms to copper pots will all be taxed. Then the government is still going to collect those excise taxes. When it is finished fleecing the sheep there will be $40 billion in the treasury.
I have read that this government has sent the bill on goods and services to the printers to be printed. Yes, it has sent it to the printers. What a sham of having the Chairman of the Finance Committee traipsing around the country giving the impression that somehow or other he had a conversion and is now willing to listen to what the people of Canada have to say.
It is cynical to note that every one of those witnesses who have come before the committee all said: "I agree with this thing, but don't tax me. Ikx this guy over here and except me." We saw the Burger Kings, the McDonalds. "Don't tax me, tax everybody else". Of course, big business says that. They want to continue their lunches. Do not touch the executive lunches. Food in the grocery stores are exempt. The people in the restaurants are
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saying: "If you exempt them you have to exempt us but tax everybody else." Everybody says that sales taxes are the most regressive taxes. I am not satisfied that this government has searched long and hard for an alternative to the present goods and services tax. We know that it set out some guidelines: First, it was going to be visible; second, it would be simple; third, it would be integrated; and fourth, it would be revenue neutral. Now, for anybody who believed the Prime Minister when he said that, have I got a bridge to sell them.
This government lied to the people of Canada. The people who are responsible for economic policy lied to Canadians. What was supposed to be budget neutral has now created a bonanza for the government.


An Hon. Member:: Its visible?


John R. Rodriguez: It is visible like Salmon Rushdie, that is how visible it is. Do you believe everything the Prime Minister promises? We were not going to get free trade with the Americans when he was seeking the leadership of the Conservative Party in 1983. He said, as you recall, that famous quote: "You want to go to bed with an elephant, well you find out when the elephant rolls over what happens to you". The guy had a warped sexual mentality, going to bed with an elephant, but people believed him then and they found out what happened.
These four principles for this GST were laid down. Now we have found out that they are more practised in the breach than in the observance. The Conservatives are really after a cash cow to have in the bam because, once it is in the bam, for every 1 percentage increase, they can generate over $2 billion in increased revenues. I say to Canadians that I do not know what to do. I do not know how we stop this government from imposing what is going to be the most regressive tax system in the western world. I do not know what we have to do.
It is unfortunate we do not have recall laws in this country so that from time to time, with a certain number of signatures, we can have a vote to recall the government or to recall a Member of Parliament. It is unfortunate that there is no check and balance in the system.
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All I have seen since we started this prelude to the full-blown debate on GST are Tories who think it is a big joke and that somehow they are putting one over on the Canadian people. They are really doing a good job. People are writing letters to the Minister of Finance, signing petitions, all in good faith, thinking somehow or other all of these entreaties and indications of their opposition somehow persuades the government not to pursue this path. Unfortunately, they will find out, as I have, that they are just shut up after a short period of time.


The Acting Speaker (Mr. Paproski):: I regret that the hon. member's time has expired.


Mr. Jim Hawkes (Calgary West):: Mr. Speaker, I do not want to take a whole lot of time of the House, but I can only sit here so long. I just want to say to senior citizens, regardless of what the NDP told you last November, you still have your pensions and your medicare. What they are doing today is telling the government to do what they tell it. We listen and we hear and we understand. I think the NDP hope that Canadians do not understand because what the opposition is asking for is a return to the kind of government that was in this country from 1972 to 1984.


Peter Andrew Stewart Milliken: That is right, we are.


Frederick James (Jim) Hawkes: That is right, he says, we are. That was a minority government in 1972 and it had a philosophy. It wanted to get re-elected. It does not matter what you have to do as long as the end goal is to get re-elected, power for power sake. What did they say to the Canadian people? They said: "We will spend, we will start all kinds of new programs. We will spend, and spend and spend. Then we will do another favour for Canadians, we will lower the tax rates."
That is the argument we are hearing here today. You do not have to tax. Be popular, spend, spend spend. Do not tax. What does that do? It does some great things for two months, three months. Everybody in the gallery today: "Use your credit card. Go out, enjoy. It will be a great supper. Spend $100 on a meal. It will be a wonderful supper."


Mr. Boudria:: On a point of order, Mr. Speaker, I am sure that you have noticed and that you are quite well aware as well that one should not address the public

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gallery when one makes remarks in the House of Commons. I am sure that you, Mr. Speaker, would want to remind the House of that.


The Acting Speaker (Mr. Paproski):: I am sure that the Whip of the government party is well aware of what he should be doing in this Chamber. He has been around here for quite a long time and I am sure he will take heed.


Frederick James (Jim) Hawkes: Mr. Speaker, I thank the deputy Whip for the other side for bringing that to my attention. When I glanced up and saw the look of disbelief as they heard the speeches from the other side, I guess it just compelled me to stand and talk.
Everybody understands that when you borrow, you have to pay back, and when you borrow even more then you have less.


Jean-Robert Gauthier: This is a tax bill.


Frederick James (Jim) Hawkes: Yes, it is a tax bill, as my friend across the way states. You are right it is a tax bill. Taxes are not popular.


Jean-Robert Gauthier: Nothing to do with borrowing.


Frederick James (Jim) Hawkes: Borrowing is popular. Taxing is not. We suffered for 12 years from that philosophy of borrow, borrow, borrow, do not tax. Increase expenditures and we will be popular. Well, the chicken has come home to roost.
When I was first elected to the House, 12 cents out of a revenue taxation dollar went to pay interest on the debt. It is 35 cents today. We had 88 cents for pensions, medicare, VIA Rail and all those things. We have 65 cents today.
We hear members on the opposite side stand in the House and fight us on the cuts. The member for Nickel Belt says: "Do not cut 12,000 civil servants". That is what he has been saying for four years. Then today he said: "Do not hire 2,500". How can you have it both ways? Only the NDP can have it both ways. They are not responsible. They are an opposition party. There is a lot of fun to be had in opposition but there is a lot of hard work in governing.
A lot of decisions that have to be made are tough decisions. We try to make them with as much humanity and as much compassion as we can in the circumstances. We try to examine the research evidence to see how we
can cut expenditures and how we can raise revenue, how we can get rid of 12 years of mismanagement of this economy and return the country to health. We have not done too badly.
Since free trade came in 209,000 Canadians have jobs. They are not on the welfare rolls, they are not on unemployment insurance today. That is 209,000 in a brief nine months. There are 1.5 million Canadians who have a job today who did not have a job five years ago. That is not bad management. Let us make the contrast. I say to all of the senior citizens who may be watching us today: "Out of your lifetime of experience in this country, after listening carefully to the Opposition about how the country is in trouble and owes more money than it should, what would you do?" What would their 90 years, 85 years, and 80 years of experience tell us to do? They would say: "Cut your expenditures, but don't cut out food. People have to eat. Don't cut out shelter. Don't cut out health care. The basics of life have to be taken care of, but cut some of your discretionary spending, as much as you can". They would say to continue to look forward, continue to cut out waste. But you have to get some extra income. You can't continue the debt spiral.
We cannot buy a house with a $20,000 mortgage and make it $21,000 the next year, $25,000 the year after that and $30,000 the year after that. Your mortgage cannot grow. To prepare for your retirement your mortgage has to go down. There have to be tax changes.
The Member from Edmonton East said: "silent killer of jobs". Well, it is getting noisier. People are beginning to understand that the manufacturers' sales tax is a cancer. It has been around since 1924.


Peter Andrew Stewart Milliken: You keep raising it.


Frederick James (Jim) Hawkes: He says because you keep raising it. Of course. We have to raise taxes, but with a little co-operation on the other side we can get a better tax in place that does not kill jobs but creates jobs, provides a stable source of revenue, and reduces our need to borrow because more Canadians will have jobs, more Canadians will be paying taxes, fewer Canadians will be dependent on welfare, fewer Canadians will be dependent on unemployment insurance.
That is what this government's policies are all about. Canadians are told that taxes do not have to be raised, that expenditure cuts do not have to be made. I ask them to contrast that with the reality that that creates debt and debt chokes us all. Debt creates bankruptcy whether we
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are talking about a nation or a little business or a homeowner.
This year 1989 is the time for all of us in the Chamber who care about this country to say: "It is time to cut expenditures, it is time to raise taxes. It is time to get the debt under control. If you are listening to any other message, you are listening to charlatans who want to drag you into a bigger and bigger pothole, where you are going to drown."


Joy Langan: Mr. Speaker, I would like to respond to the hon. member's comments on this legislation. He said that there are 209,000 Canadians who have a job today who did not have one before the Tory government took office. I would like to say to him that there are also 1.2 million children living in poverty in Canada who should not be living in poverty. I would like also to bring to the attention of this House that yesterday while we all celebrated Thanksgiving, while we had a wonderful dinner with our families and shared the weekend with families and friends, thousands of Canadians volunteered their time at food banks collecting canned goods to distribute over the next few months. In Toronto alone, 2,000 volunteers collected 850,000 pounds of food.
The tragedy of this is that every month more and more Canadian children are joining those already living in poverty.
The Daily Bread food banks in Toronto feed 84,000 people. Of these, 17,000 are children; 6,000 are physically challenged and 4,000 are pensioners. Yet we have a government which says that fewer Canadians will be living in poverty.
The member said fewer Canadians are living on unemployment insurance. When the government says that fewer Canadians will be living on unemployment insurance, it means it because what it is going to do is kick those moms and dads off of unemployment insurance to ensure that more children are going to the food banks.
I would like to ask this government and members in the House to consider that what we have in Canada is institutionalized poverty. What we have in Canada is institutionalized food banks. We have a mean-spirited government that, in addition to this kind of taxation, is
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introducing cuts in unemployment insurance, cuts in support to the family network, no child care, clawbacks in pensions and clawbacks in child allowance. Yet it is saying: "Look what a wonderful job we are doing in correcting the economy".
The hon. member who spoke before me talked about how hard one must work in government, assuming that those of us on the opposite side of the House do not work hard. Is this government planning to continue working very hard until all children in Canada are living in poverty, taking back as much as it can from the average Canadian, taking back as much as it can from working men and women to ensure that its corporate Bay Street buddies do not have to pay their share? That is what we are talking about. We are talking about who pays what share. We have not seen one step from this government to ensure that the profit-making corporations in this country pay their share. What we have is yet more taxation on those who are already overtaxed.
I noticed in my experience with the unemployment insurance committee that the government listens only to those to whom they want to listen in this country. I have received letters in from men and women in my riding who happen to share political views in terms of party affiliation with hon. members from the other side of the House.


John R. Rodriguez: You mean Tories.


Joy Langan: Tories, that is who I have received letters from. I have received letters from Tories who say: "This goes too far. We are tired of it, we are sick of it. We are not prepared to lose free enterprise to the Americans. We are not prepared to have our children taxed until there is no food available for them and they have to go to food banks. We are not prepared ourselves to be taxed and we are seriously considering where our political affiliation will lie in the future".
It may be that those people will not be coming to support the New Democratic Party. But what they will be doing is supporting a party that will indeed listen to them; be it the Reform party, be it the Christian Heritage party, be it any one of those parties.


An Hon. Member:: The Liberal party.


John R. Rodriguez: They listened to the Liberal party one time.

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Joy Langan: They listened to the Liberals one time and as you well know, Mr. Speaker, there is not a Liberal party in British Columbia so they have a choice of the Reform party or the Christian Heritage party. People who have long supported the Tory party have said "enough is enough".
Small business people in my riding are saying: "Would you please convey to the House of Commons that we work very hard in our small businesses, and we struggle very hard". They are facing increased taxation on things like gas, fuel, supplies, our employees' uniforms, all of those things that add to the burden and of the small margin which makes it impossible for a business to work. I have a daughter who is a young restaurateur in the riding next to mine. She is struggling.
She is a free enterpriser and she is struggling.


Mr. Epp:: Good grief, a free enterpriser!


Joy Langan: She is a free enterpriser.


Arthur Jacob (Jake) Epp: She will vote Tory next time.


Joy Langan: My daughter will never vote Toiy. My daughter is a socialist with a conscience. She will be a rich socialist with a conscience. I have no problem with that.


Some Hon. Members:: Oh, oh!


Joy Langan: We have too few of them to put you folks in your place.


An Hon. Member:: Unlike them, she will be willing to pay her taxes.


Joy Langan: She does not mind paying her taxes as long as they are fair taxes.
She is struggling to begin and get established in this small business. Every time she turns around there is a new tax. She said: "I wouldn't mind paying those taxes, if General Motors was paying its share, if the big business community was paying its share, if the Royal Bank that I have a loan with is paying its share, I would not mind a bit."
This is a young woman and she will be prepared when she is rich to pay her share. She believes now that they should also pay their share.
I would like to conclude by going back to my opening remarks. It is that 1.5 million children in this country live in poverty. I am getting mighty tired of hearing the hon. members from the other side of the House bleet about
how many jobs they have created when that many children in this country are hungry.


Peter Andrew Stewart Milliken: Mr. Speaker, I will be very brief. I would not have participated at this stage of the debate had it not been for the speech from the Hon. Member for Calgary West who tried to suggest in the course of his remarks that somehow the defeat of this bill would return us to the bad old days of 1972 to 1984.
Those days today seem like Halcyon days compared to what Canadians had to endure since 1984 with the present administration and its incompetent management of the economy of this country. Indeed, I would like to look at the facts that the Hon. Member for Calgary Northeast pointed out in his speech this morning. He claimed that the deficit in 1984-85 was $38 billion. Anyone would think that if you are going to reduce a deficit, you would increase taxes.
There are two ways of going about it. You can either increase taxes or reduce expenditures. This government, with great trumpeting and fanfare, says that it is doing both. It increased taxes all right. It increased taxes by $42 billion. Any reasonable person would think that if you have increased taxes by $42 billion, you must have rid yourself of the deficit. Has the deficit gone down? It has gone down only to $30 billion.
If the government has increased the taxes $42 billion, one would think that the deficit would have gone down. But it stayed very large.
The government has doubled the national debt in four years of incompetent mismanagement. The member says that Canadians do not want to go back to the bad old days, 1972 to 1984. Canadians are crying out for the bad old days compared to what they are getting from this government with its VIA Rail cuts and that sort of thing.
Let me speak to the amendment that is before the House. I want to clarify one thing. The motion that has been moved by the Hon. Member for Edmonton East on behalf of the Hon. Member for Yukon deals with two amendments to the proposed bill before us.
The amendments delete the 13.5 per cent rate from the bill. The hon. member does not seek to delete the new 19 per cent tax on wines and the new 9 per cent tax on building materials. I would have thought that the Hon. Member for Kamloops whose riding I am sure depends heavily on the forest industry and the manufacture of building materials would have opposed this 9 per cent tax. Yet, the amendment proposed by the Hon.
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Member for Yukon does not delete that portion of the bill.
I would not want to think that her amendment was in fact an approval of these vicious taxes. I can only assume that he supports the Hon. Member for Calgary Northeast in trying to get rid of the entire clause instead of just getting rid of the portion that deals with the 13.5 per cent. I know that a tax on wines might be abhorrent to the hon. member. Personally I do not find it so bad. I prefer to see none of these taxes increased and I think that is the position of our party.
If the motion that has been moved by the Hon. Member for Yukon is only to remove the 13.5 per cent rate and not to oppose the other increases at the same time, I think they might want to clarify that point to the House because, frankly, I prefer not to support that motion but support the Hon. Member for Calgary Northeast in his views that we should get rid of the entire increase altogether.


Nelson Andrew Riis: Mr. Speaker, I can clarify that for my hon. friend very quickly. I think that if there has been some consistency in this debate-and there has been some inconsistency-it has been that the New Democratic Party opposes this tax. We oppose the use of consumption taxes, of course, as our various reports have made very clear.
I must say that it has not been quite clear whether or not the Liberal party opposes some other consumption tax. Maybe 9 per cent is too high, but maybe 7 per cent is okay, maybe 4 per cent, or maybe 3 per cent. I am simply saying that I have not heard that clarified. I do not want to allege any motivations here unnecessarily, but perhaps we could have this clearly stated later.
Let me make this clear, Mr. Speaker. This move to increase the manufacturers' sales tax once again sounds to me rather peculiar because I, like my colleague from Edmonton, heard the Minister of Finance from time to time suggest that the manufacturers' sales tax is a killer of jobs. He said that it kills jobs, it kills economic development, it kills economic enterprise. It kills opportunities to develop new businesses and, by definition, create new jobs. He said that and yet, what are we doing
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today? We are increasing the tax. We are increasing the job-killer tax.
Is it not rather hypocritical for a government to say that this tax is a killer of jobs and the next day ask us to pass legislation not only to keep the tax, but to increase the tax? Back in 1980 and 1984 this killer of jobs tax was 9 per cent. We all agreed that this tax had to go. Every parliamentarian felt that the manufacturers' sales tax was a bad tax. It was ill-conceived. It was biased. It was discriminatory against that sector of the economy that, in the past at least, tended to create the most jobs.
What does the government do when it is told we dislike this tax? I remember during the campaign in 1984 when the finance minister said the government disliked this tax and it had to change. Now we assume he meant for it to go down. He meant up, but that was not clear at that time. The Conservatives said: "We have to change this tax, so we will put it from 9 per cent to 10 per cent, up to 11 per cent, up to 12 per cent, and now up to 13.5 per cent".
This is not the way to encourage economic development in Canada. When a New Democrat says it has to change, it means it has to go. That is what we mean. When a Conservative says it has to change, it means it has to go up even higher. It is a Party of tax, tax, tax. It then picks the sector of the economy that in the past has been the job generator and taxes it even harder. They pile taxes on top of taxes and then at the end of it all say they have an even greater idea. They are going to slap a tax on everything: haircuts, cribs, coffins, reading material. Recognizing that we have five million people who are functionally illiterate, we will be the only country in the world that is going to tax reading material. If they buy a book, we will tax them; a magazine, we will tax them; a journal, we will tax them; a newspaper, we will tax them too.
What kind of government would do that to its people? What kind of government would tax children's clothing? At this time of year, when you have to go out and buy new snowsuits, buy new longjohns and get geared up for the long winter, the Conservative government says that as soon as it gets this tax in place it will tax those kids' snowboots and snowsuits. That is cruel. That is a cruel, mean way of taxation.

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At the same time that this government wants to tax those mothers who go out and buy their children's snowboots, General Motors does not have to pay any tax. It says: "Oh, shucks, why force these folks to pay taxes at all? General Motors, the Royal Bank of Canada, Nova Corporation, or Cadillac-Fairview, why ask these big corporations to pay any tax at all? The Conservatives say they would rather tax the mother going out to buy clothing for her children for the winter, fill Now, if that is not a cruel, mean, dastardly tax, I do not know what is. It is actually hard to believe.
I cannot imagine how Conservatives can be sitting here today asking us to vote on legislation to increase the manufacturers' sales tax when for the last few weeks all we have been hearing across Canada is that we have to do away with this tax. We have to get rid of it because it is a killer of jobs. Here we are today responding to the Minister of Finance and he says, not only should we keep the manufacturers' tax, but we should increase it to 13.5 per cent.
One can go on to talk about hypocrisy and about the big lie. The chairman of the finance committee at every single meeting when people ask why we have to have a sales tax says this killer of jobs tax, the manufacturers' tax is bad, and is harmful to the economy. Does he know what the Minister of Finance is doing today? He is actually increasing this horrible tax. These two fellows should get together and chit-chat about this so that at least the same lie is going out. We cannot have one person saying one thing and the other person another which, of course, is now becoming unfortunately an all too familiar theme from the government.
I can simply summarize by saying that we are opposed to this increase in taxation. We do not think that increasing the sales tax makes any sense. We do not think that having it makes any sense at all and for that reason, I would encourage my friends opposite in the Conservative party, if they really believe that this manufacturers' sales tax is as bad as it is, for goodness' sake to vote in favour of this amendment to at least not increase this sales tax and to support their hon. colleague's amendment to do away with it totally.


Roger Simmons: Mr. Speaker, in my time in this Chamber and also in the
Newfoundland House of Assembly, I have heard some entertaining speeches but none more so than the one I heard just a few minutes ago from the Whip for the government, the gentleman from Calgary West. It had a familiar ring. I wondered where I had heard the same general theme before.
I found myself thinking about the exclamations of Little Red Riding Hood when she saw the wolf in her grandmother's bed: "What great big ears you have, what a big nose you have, what big teeth you have," and so on. I saw the hon. member for Calgary West trying to be one thing but looking in reality like something quite different.
If you reflect on what he said, Mr. Speaker, the essence of what he said is, "Do not be fooled by the big ears, do not be fooled by the 13.5 per cent. Putting the tax from 12 per cent to 13.5 per cent and over the life of this government, putting the tax from 9 per cent to 13.5 per cent is really the way we over here reduce taxes. It is the way we make things easier on you. You are not really seeing big ears or big teeth at all. You are really seeing a very friendly, paternal act here. We are trying to help Canadians with our tax reform."
I realized in the same moment, when I got past thinking about Little Red Riding Hood, that the gentleman from Calgary West had not often spoken in this Chamber and I realized why, of course, when I looked at the mover of the amendment. The gentleman from Calgary West is so busy these days whipping the gentleman from Calgary Northeast that he has not had much time to make speeches about tax increases or decreases, whichever you choose to characterize them as. I realized also, of course, why he has found it necessary to try to whip the gentleman from Calgary Northeast.
If I may say so, to the gentleman from Calgary Northeast, for all his having been whipped, does not look to be in too bad shape today. I think he is still fairly creative with his amendments and I commend him for speaking out on this very important issue.
I once advanced the perhaps novel suggestion that we ought, in the political party system in this country, to adopt a page out of the books of the National Hockey League, in which there is a business of trading people from time to time. As I looked around the chamber, I could see that various parties might benefit from such an
October 10, 1989

arrangement whereby we would look at our caucus and find people not of our philosophical persuasion and see if we could not trade them to where they more properly belonged. I could see certain people figuring prominently in such a trade, certainly the member for Calgary Northeast. Certainly, my good friend from Nickel Belt would be sitting a lot closer to me physically. He already sits very close to me philosophically.


John R. Rodriguez: To your left.


Roger Simmons: He is to my left, charitably so, but a kindred spirit. If we ever have the trade, he will be much closer, I assure him. The gentleman from Calgary Northeast, of course, will soon have to make a move.
Lest this whole business be seen as being just a little too jocular, let me make the point. The point is that there are people in this House who, irrespective of party label, see this latest tax increase as the wrong way to go. I have real difficulty with it and with the rhetoric coming from the official spokesman for the Tories on this one. It is the gentleman from Calgary West who best summarizes the contradiction, when he, in effect, says that this increase to 13.5 per cent is our Thanksgiving present to you, it is our way of helping you. That is the problem with the whole mindset of this government. It does not, first of all, understand what the need is out there in the country. Therefore, how can it administer to the need when it does not understand what the problems are?
When I stand in this Chamber on behalf of thousands of fishermen and plant workers and tell government members that our fishery is on the verge of collapse in Newfoundland, for example, the minister gets up the same day and tells us everything is in a state of prosperity, to use his words. When the gentleman from my own province, the member from St. John's East, gets up and assures us, against the wishes of his constituents, I may say, that everything is fine and rosy in the fishery, I begin to realize that the Tories are out of touch with the reality out there, whether it is the reality of the fishing industry, the reality of the needs in agriculture; the reality of the unemployed or the realities of small business. They are so out of touch, is it any wonder that on this one they have this warped idea that somehow they are going to help us all by increasing the manufacturers' sales tax to 13.5 per cent.
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The Minister of Finance raves on about taxes and the need for tax reform. Where has he been for the last four and a half or five years when this tax has been jacked from 9 per cent to 10, to 11 to 12, and now to 13.5 per cent? The manufacturers' sales tax that government members have been maligning and rightly so, has been one of their chief tools for raising additional revenues during the last four and a half years. It is not the only one. They have had all together 31 tax increases. That is not bad considering they have only been in office fewer than five years.
Earlier today, we dealt with amendments relating to the business of gasoline tax as it affects fishermen. Once again, the fishermen and the farmers are making a very important contribution to our gross national product. Yet, who is it who is being asked to bear the brunt again? It is the good old fishermen and the good old farmers. It is another example of how government does not really understand how to keep people working. The list goes on.


Mr. Dionne:: The government does not have a word.


Roger Simmons: I am just getting a signal here from my good friend from Miramachi who always has better ideas than I have, so I steal them whenever I can.


Arthur Jacob (Jake) Epp: It's not tough.


Roger Simmons: Mr. Speaker, the minister from Pro-vencher comes briefly awake. We welcome him to the debate. We have been here all day, actually, trying to stop this nefarious scheme that the government is trying to push through. We welcome him to the cause. He comes late but he is here, and I thank him.


Maurice Adrian Dionne: In body, if not in spirit.


Roger Simmons: He is embarrassed. If ever there was a man of integrity, it is the gentleman from Provencher. We all know that. He is embarrassed by this. How he still sits there and allows this double-talk to go on all around him, I will never know, the very double-talk we have been talking about in the last few minutes. There is one man, Mr. Speaker, that you and I, Sir, have predicted would have bolted long ago out of basic integrity. Basic integrity would have moved him to this side. Maybe when I am through, now that we have his attention and he is fully awake the minister will probably get up and rationalize this conundrum for us, why it is that the government says it is by increasing taxes that it does us a favour. That is a puzzle. I am sure it is a puzzle for him

October 10,1989
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too and I invite him to take his place and explain it all to us.


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


Some Hon. Members:: Question.


The Acting Speaker (Mr. Paproski):: The question is on Motion No. 4 standing in the name of the Hon. Member for the Yukon.
Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


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


Some Hon. Members:: Yea.


The Acting Speaker (Mr. Paproski):: All those opposed to the motion will please say nay.


Some Hon. Members:: Nay.


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


The Acting Speaker (Mr. Paproski):: Pursuant to Standing Order 76(8), the recorded division on the proposed motion stands deferred.
The next question is on Motion No. 5 standing in the name of the hon. member for Calgary Northeast.
Is it the pleasure of the House to adopt the motion?


Some Hon. Members:: Agreed.


Some Hon. Members:: No.


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


Some Hon. Members:: Yea.


The Acting Speaker (Mr. Paproski):: All those opposed to the motion will please say nay.


Some Hon. Members:: Nay.


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


The Acting Speaker (Mr. Paproski):: Pursuant to Standing Order 76(8), the recorded division on the proposed motion stands deferred.
We are now at Motions Nos. 10 and 11 which will be grouped for debate and voted on as follows: an affirmative vote on Motion No. 10 will obviate the need for a vote on Motion No. 11. However, a negative vote on Motion No. 10 will require a vote on Motion No. 11.


John R. Rodriguez: Mr. Speaker, I rise on a point of order. There was a misprint in the Order Paper, and where it says biodegradable laundry detergents, it should read non-biodegradable laundry detergents.


Jean-Robert Gauthier: Mr. Speaker, on the same point of order, first, as in prior motions, we would be agreeable to giving our unanimous consent, which is required in this case, for someone from the party on my left to move that motion in its proper form and wording. If he or she wants to move it with non-biodegradable, it is up to him or her to make the motion at this time.


John R. Rodriguez: Mr. Speaker, seeking the unanimous consent of the House, I move:
That Motion No. 10, standing in the name of Ms. McLaughlin be amended to read after Clause 8, "non-biodegradable laundry detergents".


The Acting Speaker (Mr. Paproski):: Is there unanimous consent?


Frederick James (Jim) Hawkes: Mr. Speaker, if indeed there is an error, we have absolutely no objection to correcting the error. The Chair might want to look to see whether or not that change is in order.


Nelson Andrew Riis: I appreciate the comment made by the government Whip, and I suspect that with unanimous consent it would be in order. I just want to take this opportunity to thank the hon. member for Ottawa-Van-ier for his suggestion for both the government's as well as the Official Opposition's co-operation on this change.


The Acting Speaker (Mr. Paproski):: I see no problem with that. We have unanimous consent.


John R. Rodriguez: Motion No. 10.
That Bill C-20 be amended in Clause 8 by striking out line 10 at page 5 and substituting the following therefor:
"8. Non-bio-degradable laundry detergents."


Alex Kindy: Motion No. 11
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That Bill C-20 be amended by deleting Clause 8.
He said: Mr. Speaker, talking about this manufacturers' sales tax, as has been said prior, in 1984 it was at 9 per cent and now we are trying to raise it to 13.5 per cent. It is certainly not going to help our industry to compete internationally and domestically. This is why I think it is essential that this tax be defeated. The government has not shown restraint.


Jean-Robert Gauthier: Mr. Speaker, I regret having to interrupt my friend but we are dealing with Motion Nos. 10 and 11. Both motions deal with the same subject, that is Clause 8, and with the proposal that the sales tax be imposed on laundry detergents at the wholesale trade level.
If I understand the purpose of both the NDP motion and motion of the hon. member from Calgary, one wants to amend laundry detergent to non-biodegradable laundry detergent and the other wants to delete the whole clause. We are speaking to both motions and I fail to see the relevancy of the remarks of the hon. member right now. That is why I am trying to get you, Mr. Speaker, to tell me if indeed relevancy is being applied.


The Acting Speaker (Mr. Paproski):: The Hon. Member just began speaking. With the first two or three sentences, I regret that I am not sure whether he is being relevant or not. If the hon. member will give him another two or three minutes, then I will naturally watch very closely.


Alex Kindy: I think whatever raises taxes is relevant. The Minister of Finance talked about the growing public debt and said that we have to react to it and therefore increase taxes. Those taxes would be only temporary until 1991 when the goods and services tax comes into effect. The goods and services tax is certainly a major component of the Budget speech of the Minister of Finance. I would like to elaborate on that specific tax because it is part of the big scheme of raising taxes.
The goods and services tax is certainly inflationary. It is regressive because it punishes low-income people, and it does not pass the test of fairness. A study in the United States showed that it creates bureaucracy. As I said prior, we would have to increase by about 4,000 the number of employees at Revenue Canada.
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The Acting Speaker (Mr. Paproski):: The hon. member just heard the Hon. Member for Ottawa-Vanier speaking with regard to relevancy. I would hope that he would get to the cause and not just speak in generalities. This is both on his clause and on the clause of the Hon. Member for Yukon.


Alex Kindy: Mr. Speaker, creating more of a bureaucracy is not going to help the taxpayer. It is not going to help the housewife who has to buy detergents. It certainly is a big factor in reducing government spending. Therefore, I would suggest that we should delete as a package Bill C-20 so that there would be fairness to the consumer.


Joy Langan: Mr. Speaker, I would like first to respond to the comment about housewives who have to buy detergent and suggest to the House and to the hon. members within, particularly those of the male gender, that I believe that we have passed the day when only housewives buy detergent. I believe we have also passed the day when only men are concerned about the environment. On this point is where the hon. member who wants to delete this motion and the people on this side of the House are prepared to part company. I think it is very very important that we take this fine opportunity to set an example and to get really serious about the environment.
We have launched a study about the environment in which we are working here in the House of Commons. We have talked on all sides of the House about the environment across this country and how vitally important it is. Here we have a clause put forward by the Hon. Member for the Yukon suggesting that we only apply this tax to non-biodegradable detergents. What an excellent opportunity for us to show that we are serious about what happened in our environment.
I would like to see this apply to not only non-biodegradable detergents. It is a real pity that this clause does not allow for us to include taxation on anything that is unfriendly to the environment, but we are faced with just this amendment on non-biodegradable detergent, and I think that hon. members on the other side of the House, if they are serious about the laundry and if they are serious about the environment, would vote in favour of the amendment of the Hon. Member from the Yukon.

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Private Members' Business


Don Boudria: Mr. Speaker, I am pleased to have the opportunity to speak this afternoon in this debate. Essentially what we have is a motion proposed by one of our colleagues, the member for the Yukon, giving in fact a special status to biodegradable laundry detergents and our colleague from Calgary wants to give that status to all laundry detergents by removing the clause in question.
I want to speak in favour of the amendment proposed by our colleague from the Yukon. I do believe it is time that we started to show in a very tangible way that biodegradable and otherwise environmentally friendly products be made more attractive to the consumer. Certainly one way of doing that is to have less taxation on products which are environmentally friendly. This government across the way pretends that it is interested in the environment. I see the former minister of health, now the minister of energy, listening attentively to my remarks this afternoon on this very important topic. He will know as the minister of energy how important energy conservation is. I know that he cut back in certain areas in the past where people were doing research in areas of solar energy. The minister cut back the funding in that area while at the same time the government was pretending to be interested in the environment.
Last summer, the Prime Minister attended the G-7 Summit of the Arches held in Paris and he told the rest of the world how they should be nice people like them, them being the present government, who are allegedly interested in the environment. Of course, this was at the same time as the government was preparing to cancel half of VIA Rail, at the same time as the government was cancelling energy projects involving solar energy, but now, today, the government across the way has an opportunity in a very small way to show that it is interested in the environment. The test is going to come momentarily for those Tories across the way as to whether or not they are interested in supporting a clause which provides incentives for people who want to purchase biodegradable laundry detergents as opposed to other kinds.
The amendment proposed by the member for the Yukon would in fact provide that kind of encouragement to anyone who wants to purchase the product. It is my hope that the government will see to it that the amendment is adopted and that we can move ahead in the future into more and more areas in which we will provide
tax incentives or other forms of encouragement so that consumers can buy products more environmentally friendly than the ones they are purchasing now.
I will allow the rest of the time for my-


The Acting Speaker (Mr. Paproski):: I regret that the hon. member's time has expired. I know he is looking at the clock there but my clock says that it is five o'clock.
It being five o'clock, the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper.



PRIVATE MEMBERS BUSINESS


Mr. Cid Samson (Timmins -Chapleau) moved:: That, in the opinion of this House, the government should consider the advisability of developing programs and policies to promote further processing of all extracted materials produced by Canadian mines in Canada, and to discourage the export of unprocessed minerals from Canada.
He said: Mr. Speaker, I rise before this House to present a motion and I would urge my colleagues on all sides of the House to take notice of its intent which is to propose a new way of looking at the use of one of Canada's natural resources. The motion is as read by you, Mr. Speaker:
That, in the opinion of this House, the Government should consider the advisability of developing programs and policies to promote further processing of all extracted materials produced by Canadian mines in Canada, and to discourage the export of unprocessed minerals from Canada.
Canada's minerals and metals industry account for about 3 per cent of Canada's gross domestic product and almost 20 per cent of total merchandise exports. The industry provides a livelihood, directly or indirectly, for hundreds of thousands of Canadians from Newfoundland to British Columbia.
Some 120 communities in Canada depend largely on mining or mineral processing for their livelihood. In 1988 the mineral industry continued to be one of the two most important primary industries supporting the Ontario economy. Approximately $50 million was spent on explo-
October 10,1989

ration in the Yukon and in far northern British Columbia in 1988.
In British Columbia, there were increases in the value of mineral production in 1988 because of new gold mines and increased prices for zinc, copper and coal. In Manitoba, the exploration expenditure levels were maintained at 1987 levels at an estimated $50 million. All in all, rising base metal prices and the benefit of sustained productivity increases resulted in an earnings boom for Canada's mineral industry.
The Canadian Mining Journal even said that earnings for most companies in the base metal industry would be the highest in 10 years. This sounds pretty good, great in fact. However, this cycle of good news was preceded by a severe recession in the economy and the mining industry reacted by tightening up its operation. Of course, one of the measures that was used to cut costs was to reduce the labour force.
Falconbridge Limited, the second largest nickel producer in Canada, reduced its workforce by 38 per cent at its Sudbury operation. The workforce was almost cut in half from over 4,000 in 1982 to roughly 2,500 at the end of 1987. Inco Limited, the largest nickel producer in the world, reduced its workforce by about 41 per cent.
Now that times are good, as I outlined earlier, we must take another look at how these companies, with some guidance from the government, could help in sustaining Canada's economy and provide more security for Canadians who depend on the industry for their livelihood.
The Department of Industry, Science and Technology acknowledges in one of its documents that Inco has only recently resumed efforts in product development while Falconbridge has focused its R and D efforts in improving productivity, which does not create new jobs.
My motion proposes that we discourage the export of raw materials and I want to address this particular point in a little more detail. Mineral resources can be the basis for advanced processing activities and for the manufacturing of industry inputs. We must increase the integration between sectors and promote greater research and development activities while increasing Canadian con-
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trol if we are to build these forward and backward linkages from the resource base.
The Department of Industry, Science and Technology has not done enough to promote synergy and create links between the primary sector and the manufacturing sector. More efforts must be made in that department.
The Algoma Steel Corporation announced plans this summer that would in effect take these matters into consideration. There is a strong possibility that it will close its mining operation in the town of Wawa. However, it is also looking into the possibility of the production of a new sinter product or of their sinter plant. Its plan consists of processing mill scale, a waste material that comes off the surface of steel, and blending it with other waste materials or ore.
It is to hope that the government would encourage such initiatives and provide the support needed in order for these types of projects to succeed. In this case alone, the jobs of 300 people are at stake. In fact, the future of the whole community depends on it.
Under the Ontario Mining Act, the Ontario government has the power to require companies to increase further processing of ores in Canada but it has allowed a number of specific exemptions. Falconbridge still exports nickel copper matte to its refinery in Norway while Inco ships nickel oxide, sinter and nickel sulphide to its plant in Clydach, Wales, for processing.
Take the case of copper mining in British Columbia. This is a highly unstable industry in which multinational companies produce concentrates solely for export. The copper is currently smelted in B.C. though the development of a smelter and of manufacturing facilities for the production of copper wire could be established. It is argued by some that the current situation, where more than 40 per cent of copper concentrates are shipped to foreign up-grading plants, is a good situation because there is a huge export market available in Japan and in Europe.
Let us look at how Japan is protecting its own economy. In Japan and most European countries tariff barriers exist against the importation of metals as refined products because they wish to protect their domestic refining and smelting industry.

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I did mention earlier that some argue that since there is a market for copper concentrates, and given the cost of setting up new smelting plants and starting up new manufacturing plants, why bother? Why, indeed.
It is not hard to conceive that the earth does not possess an inexhaustible source of goods for humans to use and sometimes abuse, and that we all must work toward a sustainable form of economic development that would take into account future generations. We do not want to leave behind only stumps where trees used to grow, or gaping holes with all the richness they once contained spent and gone. We must make intelligent use of these resources that are present in a finite amount.
By promoting value-added products we then extend the cycle, and this is the kind of rationalization that would provide a much needed stability. Why not make use of realistic means to promote these types of endeavours? Why not introduce a two-price system so that we could waive or reduce mineral royalties on copper moving to a smelter? We could also make expiring export contracts available at an attractive rate to companies willing to construct a smelter and extend financial assistance to a company which wants to build one. Of course, some of these options depend upon the exercise of provincial powers over resources, but surely we can work toward a national agenda on these issues.
We can only deplore that decisions like these that Canada must make for its benefit are clearly undercut by the free trade deal. In effect, the terms of the trade deal have undermined the bargaining power of the B.C. government vis-a-vis the large international mining companies which dominate the industry. We cannot let this state of affairs continue. Canada must look into the protection of its economy and its resource rather than selling out to the highest bidder.
I would also like to add some comments on the effect of mining on the environment. Clearly, mining companies benefit from our natural resources. Many communities in this country, including communities in my riding of Timmins-Chapleau in the northern Ontario region, depend on the mining industry for their livelihood. However, the people living in these communities also have the right to a cleaner environment and a safe workplace.
I would like to see more measures adopted in order to protect the lives of the families living in these areas who
see their rivers polluted by mining residues. I would like to see more research done so that air pollution can be controlled. I would like to see more measures to ensure safety in the workplace.
This motion is intended for the discussion of such concerns, as well as to promote a more rational, more stable and also a more sustainable economic development within industry and beyond. There are profits to be made from the exploitation of our mineral resources. The mining companies' present financial situation can attest to that. I would like to see some of those profits reinvested and work toward a stronger commitment, toward a cleaner and more sustainable use of our minerals.


Guy St-Julien: Mr. Speaker, the Government of Canada supports further processing of minerals extracted by Canadian mines. The big question is whether the cost of government intervention in this area would be compensated by the ensuing benefits. Mr. Speaker, I believe the answer is yes.
The situation in Canada is, briefly, as follows: Nickel ore is smelted and refined in Sudbury and Port Colbome. Canada processes its own copper ore and imports ore for smelters in Flin Flon, Rouyn-Noranda and Murdoch-ville, to name a few.
Canada has 27 steel plants and non-ferrous metal smelters which employ 75,000 Canadians. Gold is processed in Canada to the final product stage, including maple leaf gold coins. Canadian uranimum is refined before export. Our aluminum refineries are of international caliber, processing bauxite which is entirely imported.
Mr. Speaker, we must also understand the market Canada's mining industry has to contend with, a market that is very competitive and subject to international pressure. The Canadian mining industry is not in a privileged situation.
If we were to try to make further processing mandatory, this would also increase the cost of Canadian products. Buyers would simply go elsewhere, and we might be doing irreparable harm to the healthy industry we have now.
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The mining industry is now in a period of growth. It is firmly established on the international market. This is partly the result of the Canadian Government's mineral policy.
Mr. Speaker, this policy is based on the fact that the mining industry evolves in an international environment where competition is fierce. It also recognizes the fact that it is up to industry, not to the Government, to interpret and respond to signals given by the market. It is not up to us to dictate to industry how to manage its own affairs, but we try to create a favourable and constructive environment.
Mr. Speaker, the Government of Canada's main role is to provide comprehensive technical and economic information, to promote market access, to limit obstacles to growth, for instance by encouraging free trade and overhauling the regulatory system, and finally, to ensure that the tax system is fair and equitable.
I would now like to emphasize the benefits to Canada of freer international trade as a result of mechanisms like the Free Trade Agreement and multilateral trade talks held under GATT, the General Agreement on Tariffs and Trade.
One reason why further processing has not developed further in Canada is that a number of other countries have erected tariff barriers against processed products, in order to protect their own industries. Canada's opportunities for further processing will increase as these barriers are removed.
Mr. Speaker, one thing is clear. Even if the GATT rules were to authorize tariff barriers for raw materials, which is hardly likely, in any case it wouldn't work. Inefficient refineries supported by these tariff barriers would close down before those that are able to compete on international markets.
For Canada, the best approach is to encourage speedy removal of tariffs on processed and semi-processed products, so that our industry can take advantage of its natural assets. The aluminum industry, which makes use of the abundant supply of hydro-electric power in our country, is one example. It is the most promising way of raising the level of further processing in Canada.
Mr. Speaker, in concluding, I may point out that as we approach the 90's, we will be dealing with a world
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economic order that is very different from what we knew 10 years ago. The world generally acknowledges that economic growth and prosperity are stimulated most by measures to liberate trade, by rapid movement of information, technology and capital, and by competition which engenders efficiency.
Mr. Speaker, Canada has a healthy and dynamic mining industry that will prosper in this environment with government support, but without government intervention.


Mr. Charles A. Langlois (Manicouagan):: Mr. Speaker, I appreciate the opportunity I have been given to speak today on the subject raised by Hon. Member for Timmins-Chapleau (Mr. Samson).
As you know, the Canadian minerals and metals industry tends to expand outside the country, which is necessary.
Canada is the world's largest producer of zinc and uranium and second largest producer of potash, nickel, asbestos and gypsum.
Since Canada's contribution to the demand for these products is still far from its contribution to their supply, it is not surprising that we export large amounts of our minerals and metals at various stages of production.

Canada's contribution in this field is not confined to mining. In addition to the primary extraction of our mineral ores, Canada makes a major contribution to the further processing of this ore. We have a refining and smelting industry of which we can be proud and which, in certain areas, is world class. I shall have more to say about this later.
The motion before the House today would like to see an expanded role for further processing in Canada and I am in full agreement with that objective. In promoting this objective, however, we should not lose sight of some important realities. Competition is very intense worldwide at all stages of the mineral and metal industries. In the past decade we have seen the mining sector having to make some very painful adjustments, cutting its labour force and introducing new technologies in an effort to remain competitive. These adjustments were not easy, but they were necessary and the industry is the stronger for having made them.

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In the same way that Canadian mines can close and lose customers to the benefit of foreign suppliers if they cannot keep their prices low, the refining and smelting sector also faces keen competition.
The Government is confident that under the right conditons, these sectors can prosper and develop. For several years now, we have tried to create ideal conditions for the processing sectors to prosper. These efforts are being pursued on various fronts. The first two ways involve increasing Canada's access to world markets and reforming the tax system. These are familiar to all Canadians. These efforts are not particularly directed at the minerals and metals industry, but provide a basis for the long-term growth of all sectors of this industry by allowing Canadian firms to compete effectively on world markets.

This government does not believe that it would be in the long-term interest of Canada's refining and smelting industry to provide it with artificial stimulus. When the protectionist measures were eventually dismantled, as they would have to be, the industry would have to make much more drastic adjustments than if it had been exposed all along to the discipline of foreign competition.
The motion suggests that Canada should discourage the export of unprocessed minerals. I do not think that this would help smelting and refining in Canada. The most efficient smelting and refining companies worldwide would simply find an alternative supply source. Remember that while Canada's resource base is rich, it is not unique. There are many competitors. If Canada is an unwilling seller, there are other suppliers to take our place. The best long term strategy for Canada's mineral processing industry is the rigorous pursuit of efficiency and the gradual build-up of capacity which would allow it to take advantage of Canada's rich mineral wealth.
I would like to repeat for the record the six principal objectives of mineral policy set out in the mineral and metal policy of the Government of Canada in May 1987. They are: to provide a fair and balanced fiscal and regulatory framework; to foster the development of the mineral and metal sector as a foundation for regional
economic development; to promote improved technological performance and increase international competitiveness in all facets of the industry; to assist workers in communities affected by industrial adjustment; to facilitate enhanced mineral and metal exports and access to new and traditional markets; and to provide timely and accurate economic, technological and scientific information required by the industry and by the federal and provincial governments, labour and the general public.
As these objectives make clear, this government appreciates the strong role which mineral development has played and can continue to play in the economic development of Canada's regions. The Government of Canada will continue to provide a supportive environment for the industry in the ways outlined; encouragement of R and D, tax reform, provision of information, trade initiatives and adjustment assistance. However, insofar as the production and investment decisions of the industries are concerned, this government believes that individual firms are in the best position to evaluate the information on which these decisions should be based. The Canadian mineral and metal industry has a strong record of past achievement and we have every confidence that it will continue.


Mrs. Diane Marleau (Sudbury):: Mr. Speaker, I would like to thank the Hon. Member from Timmins for giving me the opportunity to speak on this matter. As the member for Sudbury I probably know as much, if not more, than a lot of the people here about mining and refining as it is carried on in my city and province. I have less knowledge of what happens across our country but one of the things I am very aware of is that there is a debate, and it may not even be a debate at this point, on jurisdiction of the mining portfolio. I am very much aware that provinces control mineral rights and, as such, feel that it is their jurisdiction. I certainly would like to see the federal government try to pressure the provinces into doing the things that need to be done.
I would like to go back and refer to what happens in Ontario. Ontario in 1917, I believe, passed a mining act which said that all minerals extracted from the ground that had been patented after a certain date in 1917 had to be processed in Canada, in Ontario I gather, and proceeded to go on with this legislation.
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In our town we have two major companies that do mining and some refining. We have Inco, International Nickel. International Nickel does a large portion of its refining in our city. It has a world-class refining capacity and does a great deal of the actual refining locally. It also ships some of its refining to Port Colbome and some goes all the way out Wales.
Falconbridge, on the other hand, does no refining whatsoever in Canada. In the early 1920s, when Falcon-bridge was wishing to refine some of its minerals itself, it found itself in a position where International Nickel controlled all of the patents everywhere except in Norway. Therefore, they were not able to register their patents for refining, or at least in this country or in the United States. So they bought up a closed refinery in Norway and were able to get a patent there and went on with business, and to this day they refine in Norway. The provincial government now gives Falconbridge special permission to ship to Norway.
In the early 1980s, when there was a severe downturn in the mining economy, had we forced Falconbridge to refine locally I do not think we would have a Falconbridge operation in Sudbury at this time. It is very important that when this rule is enforced there is some consideration given to the times. We know that this past year Falconbridge has had some considerable profits, and we are pleased with that. We also know that Falconbridge will be renegotiating this special permission with the provincial governments over the next few years.
I would like to impress upon our provincial governments the fact that we certainly would like to see the investment of some of these moneys that they have made in a refining plant, preferably in our city. On the other hand, we must always remember that they must invest money in new properties or the industry will not remain viable. It is important that, if that permission is given to ship out, there be considerable reason in terms of investments in properties to offset that. I really believe that if you build a refinery that costs $500 million and creates 300 jobs it may not be quite as good as creating 500 or 600 jobs at a new location and a new mine. All of these things have to be considered.
One of the things that I worry far more about at this point in time is the large push by multinationals to take control of our mining industry. A case in point, and it really did not come to pass, was the purchasing of
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Falconbridge by Amax. That did not come to pass, but I wonder what would happen to our industry and what kind of controls we would have if a company was solely owned from outside the country. Would it have the caring for the country and for the area in which it mines which a company that is at least partially owned in our own country would have? That worries me far more and I think we definitely have to take some very close looks at the trends of multinationals taking over some of our natural resources.
Another point that worries me very much is the monetary policy of this government, the high interest rates which lead to the high value of our dollar. I realize that it is far more difficult for our mines to make a profit when the value of our dollar is as high as it is. It is important that we maintain those profits so that the profits can be put back into our economy at a local level as well as at a national level.
I am also very worried that we will neglect the environment. That is a major issue. We in Sudbury, in Inco and Falconbridge, have done some tremendous things towards pollution abatement. As a matter of fact, I think in many ways Sudbury could be used as a model in terms of greening. I would certainly invite anyone to come to our community and see the types of investments that have been made, even through tough times, in our community on protection of the environment.
I would conclude by saying that I do support the motion. I think it is important that we pressure the provincial government, or at least exert our influence as a federal government, in ensuring that as much as possible what we produce here is refined here.


Mr. A1 Johnson (Calgary North):: Mr. Speaker, it is a pleasure to rise to speak on this issue of processing mineral resources in Canada.
Before I do so, I would like to refer back to the actual motion, wherein it says:
- the government should consider the advisability of developing programs and policies to promote further processing of all extracted materials produced by Canadian mines-
This indicates to me one of the fundamental flaws in the motion. It says all resources must be further processed. It shows, I think, the lack of understanding of the hon. member proposing the motion, particularly with regard to the coal industry, with which I have some experience. I do not know how he imagines we are going

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to further process coal before we export it. Perhaps some explanation of the industry and the process is required.
When coal is exported to be used in utilities and to make electricity in foreign lands, the only thing that is done to it before it is used is that it is pulverized. Now, if we did that pulverizing here in Canada the coal would be absolutely impossible to handle. You cannot ship pulverized coal. It would plug up all of the equipment, it would be a complete mess in terms of the environment and so forth.
Certainly we cannot say that we wish to upgrade every mineral resource that is produced in Canada. That is one particular example where it would be categorically impossible, unless of course the hon. member wishes to actually make the electricity in Canada and put it in boxes and ship it out. I am sure that when that technology is available Canadian industry would be pleased to do it because one of the biggest problems we have in exporting coal is the cost of transportation. I am sure it will be many, many years before a technology of that nature is available.
The hon. member wants us to do everything possible to encourage the processing of minerals in Canada. I am very surprised that he should say that because his party is on record as opposing the goods and services tax which is, of course, directed at making our resource producers more viable and more economical. If we want to encourage processing in Canada, then we want to make our industries as viable as we possibly can. That extra income, the revenue that comes from having lower operating costs, will encourage them to upgrade resources further. This, of course, is an objective that we all share. I am pleased, as I say, to speak on this subject today.
I think it is important to understand something about the presence of downstream processing of raw materials in Canada, and the extent that this presence varies from commodity to commodity. In cases where Canada's domestic end-use market is substantial, downstream processing is often well established. Examples of this would be, of course, the aluminum and cement industries. In other cases, the pattern is predominantly determined by the presence of high tariff and non-tariff barriers in important foreign markets. These tariff barriers increase with the degree of processing and pose a major hurdle for Canadian expansion in this area.
It is in recognition of the problems posed by these trade barriers that this government completed the free trade agreement with the United States. Canada is also firmly committed to tariff reduction through the multilateral trade negotiations now under way at the GATT. We are confident that with the removal of trade barriers, as a result of the FTA and tariff reductions, we will see significant additional growth in the further processing of minerals and metals in Canada.
This future growth, indicated by market forces, will be assisted by this government's efforts aimed at enhancing Canada's reputation as a safe and attractive haven for investment, both foreign and domestic. This includes maintaining a fiscal regime which imparts no disadvantage to our producers.
Earlier I stated that Canada already has a strong presence in further processing of minerals. It is well known that over 80 per cent of Canada's mineral production is exported. It is often believed that the bulk of these exports is in the form of ores or concentrates. This is simply not true. Let me review the metal mining sector, a sector which alone accounts for over 70 per cent of Canada's mineral production.
One hundred per cent of all nickel ore produced in Canada is upgrade into nickel matte in this country. Furthermore, some two-thirds of this is refined in Canada. About 94 per cent of our gold production in 1987 was upgraded in Canada, and some 75 per cent of the silver concentrates were processed in this country as well. Over 50 per cent of copper and of zinc concentrates received upgrading in Canada. These commodities alone constitute about 60 per cent of the metal mining sector's output in any given year.
I would like to provide a little more detail about our copper industry. The Canadian copper industry is made up of two distinct groups, the west coast concentrate producers and the central eastern integrated producers. Rail transport of concentrates from British Columbia to eastern Canada for domestic processing is an expensive proposition. It is far more economical and attractive to
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ship concentrates to Japan for refining than to transport them across Canada.
The possible construction of a world-scale copper smelter in British Columbia has been studied but has not been found to be a viable proposition. I am confident that companies will continue to evaluate new possibilities as conditions change, and that if such a proposition becomes viable that they will undertake it.
While this government wishes to encourage further processing of minerals and metals in Canada, it must be careful how this is accomplished. It is preferable that this should come about without direct government intervention. It is well to remember that while we are a leading exporter of minerals concentrates, we are also an important importer of ores and concentrates. For example, we rely exclusively on imported bauxite and alumina for our aluminum industry.
We also need foreign copper concentrates to supply our smelters in eastern Canada. In order to maintain production at Cominco's Trail smelter, significant supplies of zinc concentrate will have to be imported when that company's huge Red Dog deposit in Alaska comes on stream in 1990.
Some nickel concentrates are already obtained from offshore for domestic refining. Imports of these are expected to increase next year when the Sherritt Gordon refinery acquires additional raw material for its operations.
It is evident that Canada should not take measures to promote downstream processing in a way that will provide grounds for any retaliatory action by those countries on whom we depend for some of our raw materials.
Looking at the non-metal business, it is worth noting that Canada is a leading exporter of coal and potash. I would like to point out that these commodities accounted for over $2.5 billion in export earnings in 1987. There is little scope for further upgrading of these items, as I mentioned earlier, particularly in regard to coal.
Canada does not lack for recent improvements to its downstream processing facilities. Let me give you some examples. In the case of zinc, the Trail smelter has been
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expanded, the Valleyfield smelter has been modernized, and Kidd Creek continues to be state-of-the-art.
While Canada does not mine the raw materials for aluminum, the aluminum industry is, nevertheless, a good example of new developments in the further processing of raw materials in this country. Thanks to the investment climate created by this present government, component manufacturers have chosen to locate here and to take advantage of the presence of this industry.
The aluminum industry continues to move aggressively into further processed forms. In 1988, Alcan announced construction of a new $3 million plant to produce ceramic-related materials for use in composite products, and a $25 million plant to manufacture dural, a ceramic particle reinforced aluminum in the Lac-Saint-Jean region of Quebec. Alcan will also build a new alumina hydrate plant at a cost of $28 million. This material is used in artificial marble, toothpaste and rubber backings for carpets.
A $112 million aluminum auto parts plant is being built in Quebec by a French company. This facility to be constructed in Riviere-Beaudette will produce precision cast aluminum parts including cylinder heads and intake manifolds for the automobile industry.
Earlier this year, Reynolds Metals announced plans for a $50 million plant plant in Louiseville, Quebec, that will produce cast aluminum wheels. This plant will employ some 325 people.
Another interesting new development is taking place in platinum. Traditionally, the platinum content of Canadian nickel matte has been recovered offshore. Now, a pilot plant to recover platinum from spent catalysts has started in Toronto. If successful, it may be adapted to handle the platinum content of domestic mineral concentrates.
Canada's steel industry is maintaining its position as a world leader and competitive producer by employing new technologies. The percentage of Canadian steel that is continuous cast far exceeds the level in the United States, and we have one of the most modem pipe and tube plants in the world. The steel industry has plans for a new galvanizing plant in Hamilton and expects to apply technologies which will move us away from the use of coke in the blast furnace. These programs will move our

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supply capability further downstream and ensure a cleaner environment in industrial areas.
Canada is on the verge of becoming the world's largest producer of magnesium metal. If all planned or potential magnesium smelting projects are implemented by 1994, total capital investment in this sector could amount to more than $1 billion, creating more than 1,000 new jobs. Canada's next producer of magnesium metal, Norsk Hydro, should have its plant at Becancour, Quebec, in production shortly. This facility expects to employ approximately 350 permanent workers.
Other projects are under active consideration. For example, Noranda Minerals Inc. and Lavalin Inc. have announced their intention to proceed to the feasibility stage of their Magnola joint venture which will be based on asbestos tailings from the Thetford Mines area. Magnesium International Corporation and Alberta Natural Gas Limited are constructing a magnesium metal plant at Aylderside near High River, Alberta.
Canada's record on further processing is promising, but this government will continue to strive for improvement. Even now a considerable number of developments are under way that will improve our performance. These are examples of how this government has encouraged a well established industry to move further down the path of higher value-added activities. I am confident that this trend will continue as and when trade barriers are reduced as a result of our concerted actions with the free trade agreement and the GATT negotiations.


Mr. Rene Soetens (Ontario):: Mr. Speaker, I think as the member for Calgary North rightly pointed out, we should really read the resolution again so that we can make sure we discuss the points that are relevant. We have heard the comments about mineral extraction and the processing of minerals in Canada. Yet the resolution, if I might re-read it for you, states:
That, in the opinion of this House, the government should consider the advisability of developing programs and policies to promote further processing of all extracted materials produced by Canadian mines in Canada, and to discourage the export of unprocessed minerals from Canada.
It is interesting that the resolution switched from "materials" to "minerals". I am not sure what happened to all those other things that might not be classified as minerals in the discussion.
In my riding we have some substantial landfill sites provided to us courtesy of the city of Toronto. We are not necessarily happy to have them, but now there have been some proposals put forward that state that there might be some extraction opportunities of the wealth of energy and resources that are buried in these particular mountains, if I might call them appropriately.
When we talk about materials extraction, do we talk about iron? Obviously we must. We must talk about coal, uranium, nickel, peatmoss, copper, potash, limestone, zinc, cement-goodness, I bet you the list could go on. I think there are some 120 different identified minerals in the world. I think we have most of them in Canada, at least a substantial portion of them. I do not know if we can just talk about a very limited aspect. Of course, what is not mentioned in all this is where in fact do we as Canadians who want to process these products sell them.
As the Member for Calgary North rightly indicated, there are some products that we extract from the earth that really require no processing when they are ready for use. Certainly, he is very knowledgeable on the coal industry and made a very valid point. I suspect that the same may apply for example when we extract from the earth such things as oil, natural gas, and even water. I am not sure if a conventional thing called mining should always be considered. Mining is regarded as digging a hole in the ground to see what is down there. I am sure that is the old philosophy. The new philosophy in mining is such that I am sure that many things we do would in one sense or another be regarded as mining.
As you are aware, Mr. Speaker, I am a member of the finance committee dealing with the goods and services tax and have been travelling across Canada, at least to this point in time to western Canada, and soon to embark on a swing through eastern Canada, to hear the input of constituents. We have veiy clearly as a government identified that resource sector industries, particularly in western Canada and eastern Canada, would really benefit by the goods and services tax. I think it is very appropriate that we have had some comment about the
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coal industry. The coal industry came forward and very solidly embraced the concept of the goods and services tax.
It even estimated that each individual mine that it represents in western Canada in particular would become more profitable on average to the tune of some $500,000 per year. Half a million dollars may not be much, but it is half a million dollars that can be invested in technology. The industry can invest it in the creation of new jobs. When it buys technology it buys equipment. The industry buys things manufactured somewhere else in Canada, hopefully, even right in its own backyard or wherever the mine happens to be.
On the other side, as I mentioned, the finance committee less than a half hour ago had a presentation from the Hon. Mr. Douglas who was the Minister of Finance in New Zealand and who made some very enlightening presentations on the goods and services tax. As you know, the governing party is considered the left wing or socialist party of New Zealand. I think it caused some considerable problem to the members of the NDP caucus who sit on the Finance Committee because everything that was being said about the GST in New Zealand went so diametrically opposite to what the NDP is saying here in Canada. Yet, this was fellow brethren of the socialist societies of the world speaking to each other taking such a diametrically opposite point of view.
The one thing that Mr. Douglas commented on was that in New Zealand the practice has been to target industries and provide government assistance to those industries to do things. Since the Labour Party of New Zealand has taken over it has done away with that. It has done away with tax grants, incentive grants or, as is mentioned in this motion, programs and policies. It has done away with all of those things to business. The party's argument is that business ought to do what business deems right.
It has also done away with a lot of other programs. This Labour government had to admit that less government interference in the targeting of industries has in fact been very beneficial to New Zealand. Here we have before us a resolution which states that we ought to interfere in business and not let it do its own thing. Yet in New Zealand a government of the same stripe as some members of this House says that this is exactly wrong and
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that there ought to be less interference, with the end result that your industries will be better off.
I find that to be a very enlightening comment. Of course, it is nice to be able to say that we will process in Canada all of the things that we mine out of the ground. We will not get into specific items as to what they are at this particular point. That is great. We will process all these things. Then what will we do with them? It would be really nice to have a market in Canada where all these things could be sold. That would be just absolutely fantastic. Since there are only 25 million of us and not 250 million, we have a problem.
We have the ability in Canada to produce and to extract from the earth many more resources than we have the ability to consume ourselves. What do we do with these things? Do we just leave them in the ground until Canada's population is at 250 million? I guess we could come up with more grants to families to encourage them-not unlike as has been done in the province of Quebec-to have more children. I am not sure that that would get us to 250 million in a real hurry.
In the riding next to me, in the riding of Oshawa, the automotive industry, for example, is a very prominent employer. It is rather prominent in my riding as well. What does the automotive industry do? Ultimately, you can say that it processes extracted materials, whether it is steel, metals of one kind or another, or aluminum. It processes things and it sells them. In fairness, it sells the majority of those products produced in those plants in the riding next to me in some other country, not in Canada.
I would hazard to say that if we followed the policy of only selling those products that we extract to Canadians, then we would have a problem. It does not work. On the other hand, if we put in place rules that make that happen obviously our trading partners, wherever they are around the world, will erect barriers that will make it very difficult for us in Canada to sell things. Yes, that means in some cases, that we will have to sell products that are extracted from our rich resources and not processed. But what it does do is it provides us with a tremendous opportunity to sell processed products. Those processed products start to work to our advantage, as is very clear.

October 10,1989
Private Members' Business
We do not operate in isolation to other countries. We do not operate in isolation to various trading arrangements that exist in the world. In fact, as members of the GATT, we have substantial trading relationships. Any policies that would interfere with the free flow of goods I would find very difficult to support because the agreements we have with trading partners encourage free flow in both directions. Yes, we win on some and we lose on others. We have a number of substantial winners which I hope in a future presentation, Mr. Speaker, you will allow me to speak on. I could go on for a half hour at least talking about the winners that we have in Canada on resource extraction.


Hon. Bob Layton (Lachine - Lac-Saint-Louis):: Mr. Speaker, I appreciate this opportunity to share with the House some special feelings about the mining industry of Canada because, as the House will know, I served for two years, between 1984 and 1986, as the Minister of State for Mines. In that two-year period I enjoyed the learning process which is the privilege of all who serve in these capacities. But for me, as an engineer, it was a very special introduction to the magnificence of Canada's mining sector.
As members of the House will recall, the international cycle for commodities, particularly some of the main products of Canada, cycled very badly in the late 1970s and early 1980s. The industry had presented to government year after year the need for attention to their interest to reinforce the industry so that it could come back and compete when the cycles rejoined in the future.
As minister, I was privileged to meet with the leaders of our great mining companies in Canada and to learn of their capacities and their technologies and their very special concerns. In retrospect, I am pleased to have been able to serve as minister during a period in which those cycles did turn around. The very hopes and prospects of the industry which had been set out by the industry to the government and which the government accepted through its leaders in the Energy, Mines and Resources Department turned around.
I should not pass that reference to the department without giving credit to the men and women who have served Canada as technology leaders in the Can Labs
that Canada sponsors jointly in working with the private sector. The doctors of technology who have established and guided those centres across Canada have done a wonderful job and are part of this rebuilding process, this further processing or refining process that we are discussing today.
As my memory goes back to those occasions together, I remember from the very beginning the need for consultation and the need for working in concert with the provincial governments. Our Constitution very specifically addresses the rights to mineral wealth to the provinces. I learned, as many of our colleagues here will know, that there was a division between the federal authority and the provincial authority which often confused and frustrated the mining industry. Mines ministers' conferences were never quite complete in much the way that Canada's discussions on its Constitution are not complete because Quebec was not there.
I was privileged to preside over and chair the first mines ministers' conference in Charlottetown, Prince Edward Island, at which the provincial Minister of Mines for Quebec, one of the three very large provincial ministries in mines, was present and participated fully, raising the same concerns for the mining industry that we all did. We looked for harmony and harmonization of the regulations so that mining decisions to explore, to develop, to exploit, to operate, were all addressed with a fairness or a unity for Canada so that it was not one province out-bargaining the other in terms of advantage.
The primary function of the Canadian Government in this process was to reinforce the magnificence, the potential of our mining industry. I remember another incident which was that a series of conditions in our finance legislation provided for what were then known as flow-through shares. It was a mechanism or a treatment of investments which went into the development or exploration for mining potential which is a tremendous risk.
I learned that while some of us look at investments as having a return within so many years, perhaps over a period of 10 years, for many mining ventures it was 10 years before they started to operate and begin to recover the front-end risk money which had gone in 10 years earlier. This is a tremendous expression of confidence in Canada's ability and in a mine's ability to ride through a
October 10, 1989

cycle and then compete with all the others which are looking for the world markets.
I think it was my colleague from Ontario who pointed out this need to recognize that we are in a world market and that others can meet the demands of this market like anyone else.
I am going to be very disappointed this afternoon because I can see that the clock is going far too fast and I know you are not going to allow me, unless we get unanimous consent, another half hour. I will do my best to finish in the two or three minutes you are going to allow.
The uranium deposits with which Canada is blessed can continue to become for safe and peaceful purposes a tremendous resource in Canada, both in Ontario and particularly now in Saskatchewan. A special facility, Eldorado, was built at Port Hope, not far from the riding of Ontario. The competition which that processing plant found became an international concern in trade and in relationships with the U.S.
Major users of uranium in the U.S. would wish to buy the uranium in its raw form and direct it to the refining plants in the southern United States and then process it into their uranium thermal plants. This was fine except that we had a capacity which was efficient and modern. We added to that capacity in Port Hope, and further refining was done but always with the recognition that we had to compete with the access to the same materials through other means. We have tremendous competitors in this world when it comes to our mining products. The Australians are in a great position to compete with Canadians because their mines are just as rich, and their resources are just as strong.
I hope that this motion will be considered as time goes by, recognizing that the real need is for Canadians. I see you are almost on your feet, Mr. Speaker, so I will not stretch this out too long.
I want to give credit to the member from Calgary North who also raised a number of important points in his address to this House this afternoon. As I say, Mr. Speaker, I know you are going to have to watch the clock, it is your duty, and I honour you for it. Thank you very much for this occasion.
Adjournment Debate


The Acting Speaker (Mr. Paproski):: The time provided for the consideration of Private Members' Business has now expired. Pursuant to Standing Order 96(1) the order is dropped from the Order Paper.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Standing Order 38 deemed to have been moved.

Nelson Andrew Riis: Mr. Speaker, I am pleased to have an opportunity to say a few words about the 9 per cent manufacturers' sales tax that the government plans to introduce on January 1, 1991.
I want to refer to an issue I raised in Question Period, regarding the report presented to the country by the Conference Board of Canada. At that time, the Conference Board vice president and chief economist, Mr. James Frank, issued a number of observations that I thought would be worth presenting to the Minister of Finance.
The Conference Board of Canada we all recognize as being the most prestigious and the most objective economic think-tank and projection firm in Canada. Their track record has been impeccable in terms of predicting the impact of various government programs, and their researchers and reports can be rated as nothing short of outstanding.
Their latest report on the goods and services tax indicates that inflation will increase, economic growth will be reduced, and that more than 70,000 jobs will be killed in the first year of the goods and services tax. To put it more precisely, the Conference Board of Canada suggests that inflation will increase to 7.3 per cent from 5 per cent, in 1991.
As a result of the hearings in various parts of Canada, we have heard that the labour movement certainly sees this as a reason to be requesting significant increases in pay packages. If inflation is going to increase by 7.3 per cent and the tax will add another 9 per cent to the cost of most goods and services, we are looking at requests

October 10, 1989
Adjournment Debate
coming in at 16 per cent in one year. Along with the indication from the manufacturing and retail sector that prices will have to be increased to reflect the increased costs associated with the sales tax, it means that prices will go up, and wages and salaries will have to go up to meet this increased cost of living.
When the cost of living goes up, or as I might also state it, the inflation rate goes up, the Governor of the Bank of Canada will feel obligated to raise interest rates accordingly. As the Minister of Finance has indicated, we can expect the interest rates to go up a number of percentage points as a result of the goods and services tax which will further strangle any hope of economic growth, particularly in the regions of Canada.
The Conference Board of Canada goes on at some length to point out some of the concerns that they have regarding this government proposal. I must say that they reflect much of what I have been hearing in communities like Clearwater, Chase, Barriere, Kamloops, Logan Lake, Westwold, Savona and many other smaller communities within my own constituency, where people really make four points. Whether they represent small business, homeowners, tourist operations, loggers, farmers, ranchers, restaurateurs, seniors, students, or whatever group, they remind us of the fact that the Prime Minister of Canada promised that if a sales tax was going to be introduced, we would be promised and guaranteed four items.
One, the tax would be visible for all to see. Well, the Prime Minister has had to renege on that promise because we now know that in many cases it will simply be built into the price of a service or a commodity and the public will never see the fact that there is a 9 per cent federal sales tax.
The Prime Minister promised that it would be revenue neutral. That is the second promise that he broke, because now the Prime Minister has indicated that it will not be revenue neutral, that this tax will raise $5.5 billion beyond what the present manufacturers' sales tax presently raises.
The Prime Minister also promised that the federal sales tax would be integrated with the provincial sales tax and we would have only one tax to pay that would be termed a sales tax. That promise has also been broken, because now we know that the federal government will
first of all impose its 9 per cent tax and then on top of that the provincial governments that have a sales tax will impose their provincial sales tax, which means they will be taxing taxes.
The Prime Minister said that it would be very simple. The Canadian Federation of Independent Business, which represents 80,000 small businesses across Canada, states that this is going to be a red-tape nightmare, that this system is too complex to consider introducing and too expensive to introduce.
On the matter of the goods and services tax, groups like the Canadian Chamber of Commerce, the Canadian Federation of Independent Business, the Canadian Organization for Small Business, virtually every agricultural organization in Canada and now, lastly, the Conference Board of Canada, the most prestigious board in the country with regard to predicting the economic implications of various government initiatives, are condemning the sales tax and saying that this will squeeze economic life out of our economy. They have asked the government to go back to the drawing board. They join with groups like the New Democratic Party which also have been saying: "Let's go back to the drawing board. Let's look at real tax reform of our tax system rather than have a regressive sales tax that discriminates against the regions of Canada and the poorer people of the country. Let's have real tax reform that is fair, just and equitable".


Mr. Pierre H. Vincent (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, I am pleased to answer my Hon. New Democratic colleague and you will allow me to begin by pointing out how sweet it is to hear the New Democratic Party finally support these arguments, along with the Canadian Chamber of Commerce and the small business federation, although they usually condemn the Chamber of Commerce and its members, condemn small business, etc. But this time, they support it.
On the other hand, my colleague perhaps made two small mistakes in his presentation, Mr. Speaker. In the first place, he said that the Canadian Chamber of Commerce and the Canadian Federation of Independent Business do not support the new tax. That is false. Every
October 10, 1989

organization, Mr. Seaker, which appeared before the Standing Committee on Finance told us:
"First, the present federal sales tax is bad for Canada; the present federal sales tax must be changed. Now, in the context of your proposed GST, we would like to see some things done differently." Great! Everyone, even my colleague, the Finance critic, condemns the present federal sales tax. I listened to my constituents and I can tell you, Mr. Speaker, that I also go around my riding, to Pointe-du-Lac, Saint-Severe, Saint-Barnabe, Trois-Riveres-Ouest or Trois-Rivieres, and people tell me that they know the tax will be visible, because businesses will be very glad to put it on the bill, saying, "This is the federal government's tax, not profit we are making."
Second, people are aware that the tax will bring in more revenue, but they are very glad that the extra revenue will be returned to them. All families whose income is under $30,000 a year will get a tax credit.
Third, Mr. Speaker, the Prime Minister never insisted that the tax must be federal-provincial. He always said that he would prefer it, but we know that the provinces refused.
Finally, Mr. Speaker, small businesses, as I was told again lask week in Pointe-du-Lac, are very glad to know that they will get $600 a year to administer a tax that can fit on an 8 x 12 page.
Mr. Speaker, those are the points that I wanted to make. The tax will be simpler, fairer and more equitable for Canadians and for business.


FISHERIES-IMPACT OF FREE TRADE AGREEMENT ON ATLANTIC CANADA-CRISIS IN ATLANTIC INDUSTRY
Roger Simmons: Mr. Speaker, the riding of Burin-St. George's has 158 communities, the majority of which are very heavily involved in the fishery, and a number of which are involved in the deep sea fishery. For example, we have deep sea plants at Burgeo and Ramea, at Gaultois and Harbour Breton, at Fortune and Grand Bank, at Marys-town and at Burin.
I tell you that, Mr. Speaker, because I believe it goes a long way toward explaining why it is I have been raising, on a regular basis, the issue of the current state of the fishery.
Adjournment Debate
Indeed, the item on the agenda to which we are now speaking, the so-called late show or adjournment debate, actually arises out of a question that I put to the Minister of Fisheries on or about June 20.
For at least four months we have been talking about this issue and during that time I have been characterizing the current state as a crisis. The Minister has disagreed with me. As recently as Monday past, just eight days ago, he took exception. If we look at Hansard, we see that he chose quite different wording to characterize the current state of the fishery. He said that in most respects, fishermen in Atlantic Canada are enjoying a year which is prosperous and adequate for their needs.
Almost any fisherman, almost any plant worker in Atlantic Canada, can vouch for the fact that the minister's statement is simply not true. It is just not true. The question arises, why is the minister, aided and abetted, I may say, by the gentleman from St. John's West who I guess may be responding to these few remarks of mine, choosing to send out what is clearly a false signal? I can only guess that somebody has come up with a strategy to downplay the issue. They are not going to convince anybody who is actively involved in the fishery. They are certainly not going to convince anybody involved in the Newfoundland fishery, either the inshore or the deep-sea fishery, that there is no crisis. They are not going to convince any of those people that the fishery in Newfoundland is not on the verge of collapse.
They certainly are not going to convince the Newfoundland government from whom the Government of Canada has had in its hands this report for two months, a report rightly entitled "Resource Crisis in the Newfoundland Fishery". The report goes into some detail to spell out the dimensions of that crisis. It refers in part to the overfishing by the European community.
To give a quick example, in 1986, NAFO, the Northwest Atlantic Fisheries Organization, assigned to the European Community countries 26,295 tonnes as its quota for that particular year; in round figures, 26,000 tonnes. In that year, countries in the European Community fished not 26,000 but 160,000 tonnes or about six times as much as the quota would allow. The figures are similar for succeeding years.

October 10, 1989
Adjournment Debate
One, there is a crisis. Two, is there any wonder that there is a crisis? Third, I say to the minister and his parliamentary secretary that if there is no crisis, what is the Minister for International Trade doing overseas? Four years after it started, he has now discovered there is overfishing. He is now going to go out there and do a selling job. Well, bully for him. You have heard about closing the gate after the horse was gone.
This is a classic case of where this government has obfuscated, tried to cover up and be wishy-washy in terms of the issue and finally, too late, talking out of both sides of its mouth, the one hand saying there is no problem, there is no crisis, and the other hand going out to try to put out some fires.
It is beyond the bushfire stage. The fishermen, the plant workers that I represent, know there is a problem and they know the very serious dimensions of the problem. If we were to pursue this report a little further, we would find in graphic terms what the ramifications are going to be in terms of job losses in the next few months.
I do not need to take you through that, Mr. Speaker, because every fisherman, every plant worker, is aware of the dire possibilities for their industry and for their livelihood. That is why I raised the question in June and since then, and that is why I gave notice in June that I was not satisfied. I am still not satisfied with the answers I am getting from the government.
I want to know, and I hope the parliamentary secretary will tell us, why they have their blinkers on in terms of this issue. More to the point, what will they do to help mitigate the issue, to offset the serious dimensions of this problem being faced by fishermen and plant workers?


Mr. Ross Reid (Parliamentary Secretary to Minister of Fisheries and Oceans):: Mr. Speaker, the Atlantic fishery is an essential and fundamental component of the Atlantic and the Canadian economies.
In the period since 1977 the value of output grew by 57 per cent in constant dollars while over-all growth in Atlantic Canada was 42 per cent during the same period. The Atlantic fishing industry is a world class competitor. This government believes that such fundamental strengths combined with the opportunities provided by
the Canada-U.S. Free Trade Agreement guarantee benefits for the Atlantic fishery.
While the Canada-U.S. Free Trade Agreement bodes well for the future of all regions in Canada, the Atlantic region in particular can expect significant economic benefits. Most studies identify Atlantic Canada as a primary beneficiary of the agreement.
The Atlantic fishery in the long term is a winner from the free trade agreement. As tariffs are removed, Canadian processors will have the opportunity to expand production of consumer ready products in Canada. Such diversification will lead to more jobs and an improved economic base for many communities in this country.
This provides a positive note for the important Atlantic fishery. Of course, there are factors which are currently having a negative impact on the fishery. Recent downturns in the resource availability of some stocks are known to us all. Factors such as these have always been a part of the fishing industry. It remains fundamentally sound.
The government has in place a wide range of programs to address short run adjustment problems. These include the Canadian Jobs Strategy, industrial assistance and unemployment insurance which are available to cushion the impact of changes in economic activity on individuals and communities. After a full assessment of the problems in the existing programs, the government will, if necessary, initiate further programs or adjust existing programs to assist the industiy as it has done in the past.
The important issues related to stock assessment and overfishing are being dealt with separately. The Prime Minister has appointed a special committee of cabinet to coordinate the government's response to problems in the northern cod fishery and to look at other Atlantic fisheries issues as appropriate. This committee is chaired by the Secretary of State for External Affairs.
With respect to overfishing, among many other things the government has initiated a series of diplomatic initiatives to ensure that the European Community and its member countries realize the effect overfishing is having not only on this vital resource but also on the relationship between Canada and Europe.
This government is fully confident in the measures that it has in place or will put in place to deal with adjustment in the Atlantic fishery. Moreover, there are significant benefits offered by the Canada-U.S. Free
October 10, 1989

Trade Agreement, and we are in a position to seize on them.


TRANSPORTATION-IMPACT OF CORPORATE PLAN-GOVERNMENT POSITION
Joseph R. (Joe) Comuzzi: Mr. Speaker, on June 6, 1989,1 asked the Minister of Transport and through the Minister of Transport to the House and through the House to the people of Canada and more particularly to the people who work for VIA Rail in Canada what were the plans that they could rely on for their future as employees and workers of VIA Rail.
The question was based on information on that day or the day previous that was released in The Globe and Mail that indicated that VIA's corporate plan indicated that all of VIA Rail would be cut by at least 50 per cent; all the employees and the routes would be cut by at least 50 per cent. That was on June 6, almost four months ago.
I also questioned the Minister about whether, in consideration of the leaked report in The Globe and Mail and with respect to the corporate plan, it would not be wise and not be in good taste that he would at least let the people who were working for VIA Rail, the 3,000 people the report claimed were going to be laid off make plans for their future, for alternate employment, other employment, retirement, early retirement; or all those things that we are hearing about now in this House.
Essentially, I was asking that since we knew there was going to be some drastic measures taken on VIA Rail, could we at least give the employees of VIA Rail an opportunity to protect their own future.
Last Wednesday, a day which will be remembered, particularly by our friends in Atlantic Canada, northern Ontario, small communities throughout this province, municipalities across this country, as black Wednesday, Canadians learned the severity of the plan that we talked about in June in this House.
On January 15, 1990, VIA will eliminate 18 of its 38 routes. The number of trains running will drop to 191 from a current level of 405. The VIA network will reduce its present size by well over 50 per cent. The Globe and Mail was in fact correct. Its estimation of 3,000 employees directly affected was correct. Over 10,000 employees in Canada, those employees employed by CN
Adjournment Debate
and CP and in the tourist industry, will be indirectly affected.
The reason for my question in June was simply to allow these faithful people who are directly affected in Canada to prepare themselves for that eventuality. Atlantic Canada was disemboweled by the moves of VIA Rail. My greatest concern since the announcement has been the government's decision to eliminate The Canadian, a line that runs a passenger rail service through northern Ontario. Commencing on January 15 of next year, the 150,000 northern Ontario residents of Sudbury, the 1,000 residents from Chapleau, the 2,500 from White River, 5,000 residents in Marathon, the 2,500 residents in Terrace Bay, the 120,000 residents in Thunder Bay, the 1,000 people who live in Ignace, the 10,000 people who live in Dryden, the 10,000 who live in Kenora, all along that CP line, will be denied access to passenger rail service in our country. A total of over 350,000 residents in northern Ontario will be denied this service.
Instead, this government has chosen to provide VIA service cross-country three times a week by continuing the cross-country rail line through a route what we used to refer to as the continental line, or the old CN line that starts about 30 miles north when it leaves Toronto, goes up north, about 30 miles north of Sudbury from Capreol, travels the northern route through smaller communities and finds its way into Winnipeg. It goes through Sioux Lookout, Nakina and places like that.
As a result of this very vital decision that affects northern Ontario, the government has chosen to go by the northern CN route, which will have a population of about 5,000 people, rather than the route that was formerly occupied by The Canadian on the north shore of Lake Superior which gives the opportunity to 350,000 people from northern Ontario to still avail themselves of passenger rail service in our country.
I know the parliamentary secretary to the Minister of Transport is prepared to answer this query today and I would ask, in closing, since this so affects the people of northern Ontario, could he restrict himself to that answer alone. Why did the government choose to go on a northern route with only 5,000 people who could avail themselves of passenger rail service rather than taking the other route that would allow 350,000 people from northern Ontario to avail themselves of passenger rail service? Thank you for this opportunity, Mr. Speaker.


Mr. Ross Belsher (Parliamentary Secretary to Minister of TVansport):: Mr. Speaker, I would like to thank the Hon. Member for Thunder Bay-Nipigon for giving us the opportunity of once again explaining to the Canadian people some of the more difficult decisions that have

October 10, 1989
had to be made in the transportation portfolio during these past few days.
As far as reductions in service in northern Ontario are concerned, the hon. member knows that in order to maintain the national service that is affordable and sustainable, we have had to make a very difficult decision. He knows a commitment has been made to service those comunities that have had no other forms of transportation.
All of those considerations had to be taken into account in order to meet the fiscal responsibilities, the realities which are facing us, and that the new system must be affordable.
The larger northern Ontario communities that the member has referred to have transportation alternatives which remain in place and which have the capacity to take up the slack and we expect will continue to serve the population in these areas.
I believe that the minister was quite clear last week when he made the announcement concerning VIA Rail's five year corporate plan. It is the government's intention that a restructured VIA will result in a national rail passenger network that is, as I have said before, affordable and sustainable. One of the most difficult decisions that had to be made in this restructuring process is that it would mean a reduction, as he has already mentioned, of some 38 per cent of the existing workforce. I think around 2,700 is the more correct figure, not 3,000 that he read in the paper a few months back.
The minister announced that VIA's five year plan makes provision for separation benefits for those af-
Adjoumment Debate
fected employees totalling more than $140 million. VIA has one of the best separation packages available. Additionally, our government has specifically directed VIA to treat all affected employees with generosity and in the fullest compliance with all the applicable collective agreements and legal requirements that are already in place. While that is not a job, nonetheless it does help cushion the blow that will befall some of these people.
In closing, I would like to say that the government does have a host of services and programs, through the Department of Employment and Immigration, such as the industrial adjustment services, and the Canadian Jobs Strategy, that will also help workers to find new jobs and to acquire new skills.
This action has had to be taken because VIA was inefficient, ineffective, and in 1988 it cost a subsidy of some $641 million, and that was rising. It represented a subsidy of $1.5 million a day. Canadians will understand, I am sure, when they finally see the enormity of what we were putting out and what it was continuing to grow into when they see how we are trying to shrink that subsidy.
It is with regret that VIA is going to have to be cancelled out of some of the communities that it now services.


The Acting Speaker (Mr. Paproski):: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 2 p.m., pursuant to Standing Order 24(1).


[Stage Direction]
The House adjourned at 6.28 p.m.
[Stage Direction]
Wednesday, October 11,1989