1990-10-30

Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, almost two weeks ago, on October 18, I rose and asked you to rule on whether or not the privileges of myself and other members have been breached by the boycott of the transport committee. While you continue to deliberate on that issue, I would like to raise a second related question of privilege.
I ask you to look at the failure of the government Whip to call an organizational meeting, as provided for in paragraph 579 in Beauchesne's Fifth Edition. It is only through his action that the committee can elect a chair and operate as the House intended when it struck the standing committee.
I ask you to rule on whether this failure to act impedes members of the House in the performance of their general duties on committee and, in particular, whether it prevents members of this House from performing the specific duty of reviewing the Order in Council appointments of two important transport officials. My arguments that there is prima facie case of privilege will be very brief.
A few years ago the House examined the operations of the House with a specific goal of increasing the role of private members. The Special Committee on Reform of the House, chaired by the former member, James McGrath, made several suggestions which were adopted by the House. Among these suggestions was a mechanism to enable House committees to review Order in
Council appointments. This empowerment of House committees provided for an accountability of the executive power to appoint and thus a check on abuse of patronage appointments.
The Standing Orders which govern the procedure are 110 and 111. Briefly, these rules provide that Order in Council appointments shall be tabled in the House within five days of their being gazetted and that they are automatically referred to a standing committee. The committee then has 30 days to make a decision on whether or not to summon the appointee and, if it decides to do so, a further 10 days to hold a hearing.
I do not think I can understate how important this right of review is to the proper functioning of Parliament. It is the only mechanism available to Canadians, as Standing Order 111(2) states, to "examine the qualifications and competence of the appointee or nominee to perform the duties of the post to which he or she has been appointed or nominated".
Yesterday, the government tabled two Order in Council appointments and referred them both to the Standing Committee on Transport. One is the appointment of the Deputy Minister of Transport, the other is the appointment of the Associate Deputy Minister of Transport. These are extremely important appointments. These two individuals will be charged with the day-to-day operations of one of our largest government departments. Yet, as things currently stand, I will be unable to ask the transport committee to summon these two important individuals. The committee will not be able to make a decision to summon them or not. The House of Commons will not be able to ask them to demonstrate their ability to meet the requirements of this public office.
It may be submitted that the government has another 28 days to call a meeting of the transport committee in order to enable it to review these appointments. I think there is evidence that they do not wish to call such a meeting.
Yesterday, the government introduced a motion to refer an important transport matter, the issue of open skies, to a special committee of the House. I was party to

October 30, 1990
Privilege
the original negotiations to refer this to the Standing Committee on Transport. Surely, if the standing committee were to meet soon, the government would have continued with its original plan.
In conclusion, I submit that the following establishes a prima facie case that the ability of members to fulfil their roles and responsibilities is being impeded by the chief government Whip. First, the Standing Committee on Transport is not meeting and cannot meet until the government Whip calls an organizational meeting. Second, the motion to establish a Special Committee on Transport is evidence of their intention to not call a meeting of the Standing Committee on Transport. Third, the appointments of the deputy minister and associate deputy minister have been referred to the Standing Committee on Transport. Fourth, until the Transport Committee meets, organizes, and elects a chair, I nor any other member of the House can ask for these appointees to come to committee. And, fifth, there is every indication that these appointments thus not be reviewed.
I apologize for taking up so much of your time, and the time of the House. I hope with your guidance, this entire matter can be resolved. If you find there is prima facie evidence, I would be delighted to introduce a motion to refer the matter to committee, in this case, not the Standing Committee on Transport.


Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, I rise to support, very briefly, the comments just made, but I want to add one or two further elements as well.
There is an additional Standing Order of the House which I believe is being breached by the action of the government in this case, namely, Standing Order 106. The Speaker will recall that when the question of privilege was raised in the House the last time, the Committee on Transport had been asked to sit, pursuant to Standing Order 106 and Standing Order 108. They refer to a committee meeting further to a request by hon. members, having petitioned the chairman of the committee and causing it to meet for the purposes of studying a specific issue.
My colleague, the hon. member for Hamilton West and others, made exactly that request but by not providing the sufficient number of members in order to cause a quorum, the government made it impossible for the committee to choose a chairperson of that particular committee.
The Standing Orders were not followed by this particular action. That is very regrettable because the committee, at that time, wanted to study the issue of the Hamilton Harbour, which is a very important issue, brought to the attention of the House by my colleague, the hon. member for Hamilton West. In spite of specific Standing Orders enabling members to refer such matters to the committee and in spite of the action having been taken by a group of hon. members of the House, the committee has never studied it. The government's action thus has caused a breach of yet another Standing Order, in addition to the one raised by our colleague, the hon. member for Thunder Bay-Atikokan, earlier today.


Mr. Jim Hawkes (Calgary West):: Mr. Speaker, I think the hon. member for Glengarry-Prescott-Russell has just provided the House with the arguments relevant to the reality that the orders in our Standing Orders are being obeyed. Standing Order 106 does govern the situation, to some extent, and the House is acting as if Standing Order 106 were be attended to in the way that it should.
I want to go back to the arguments raised by the Whip for the New Democratic Party and I think that part of what he said is that something could occur only through my actions, as the chief government Whip. That is simply not correct. With regard to the responsibility of the Striking Committee, Standing Order 104(l)(a) reads in part:
-within the first ten sitting days after the Monday following Labour Day, lists of Members to compose the standing committees of the House and to act for the House on standing joint committees -
That is a responsibility which the committee I chair has and we met that obligation and reported to the House on October 5. Standing Order 104(l)(b) states that we may not report to the House again any earlier than the end of this calendar year.
We have a single report from the committee. The Standing Order says that can be the only report for this fall session related to the composition of committees of the House. We have done that.

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[Stage Direction]
October 30, 1990
[Stage Direction]
I sought the unanimous consent and in all of our parliamentary history that has always been given for the formation of new committees, up until this fall. The McGrath committee report on reform of Parliament indicated that this should happen once a year so that members' privileges related to their membership on committees are protected and protected adequately, and that was done. But Standing Order 104 also states that we should have an opportunity to change those committees at the commencement of the fall session, each year. That is what should be happening in the House.
If we need to divide, that is fine. We should be dividing on that Striking Committee report. That is the remedy not only for the transport committee and the issues raised by the New Democratic Party Whip, but for some other situations as well that are becoming somewhat burdensome for members on all sides of the House.
During the course of the summer it is not unusual for opposition parties to change critics, as an example. It is not unusual for governments to change parliamentary secretaries and/or cabinet and responsibilities of one kind or another. That is what the summer in part, traditionally, has been for. We have Standing Order 104 so that we can then go into the fall session with those new assignments clearly related to the formation of committees.
I think the division on the members of the striking committee is simply one related to the size of our standing committee. The majority of members of the House, I think, feel clearly that those standing committees should be small rather than large.
If you look back on the attendance of those committees for the last couple of years, you will find that the poorest attendance relates to the committees that have been large. The best attendance relates to the committees that have been small.
I think you will find in particular that the obligation to be in attendance in the large committees has not been fulfilled more often by the opposition members than by government members. Attendance difficulty relates to their caucus and their sense of responsibility. It is difficult sometimes to be a critic in the full sense and also to be a member of the standing committee and to meet
Privilege
both those obligations day in and day out. Certainly the attendance records of the House would show that.
We have had one other departure from normal over the summer, Mr. Speaker, in that we now have an abnormally large number of independents in the House. There are 13. Approximately 10 per cent of the opposition in the House is represented by independents. The striking committee report reflects that reality and provides a place on a proportional basis or reasonably so for independents in the House to participate in the standing committees of the House in a direct way, including a vote.
We did our best as a striking committee. If the opposition members who spoke earlier this day would like to divide on that committee report right now or later when we are called to the House perhaps for another division later this day, at any convenient time government members would be quite prepared to face that division, and if the committee report were affirmed, we would be off with the new committees. If it were rejected by the House then we would have to consider that situation in light of our standing orders.
It is incorrect, Mr. Speaker, to say that my action constitutes the remedy for the dilemma which the New Democratic Party proposes. The remedy, according to our standing orders, should be the normal practice of the House on accepting the striking committee report which was tabled in this House on October 5. That is about 25 days ago. Certainly in my conversations with members on all sides of the House, they would prefer that the striking committee report be accepted. That would be the preferred model I think for most, if not all, members of the House, but the only way we would know that for sure is simply to divide.
I would ask that you seek unanimous consent at this point to divide on that issue now and then I think you could avoid having to rule on the question of privilege.
Mr. Stan Keyes (Hamilton West):: Mr. Speaker, my remarks will be brief, too, but I feel I must add to this argument being put to you and I hope that you can come to speedy resolution on the situation.
The chief government Whip is speaking on two considerations for your deliberation. On the one hand he regrets the process being undermined because in part 106, the part of the situation he claims he is in because of the situation of appointing a chairman to those committees. On the other hand, the chief government Whip has

October 30, 1990
Privilege
no problem with making two government appointees that must come under the consideration of the transport committee.
I do not understand how on the one hand he can make one claim and on the other take action which is in need of examination by the hand that he says he cannot do anything with. It makes no sense to me. This job is frustrating enough with all its rules and regulations without having points of argument put forth by the chief government Whip as has been presented to us today.
On the other point of order, Mr. Speaker, I rose in this House on a point of privilege because I feel that my privileges have been directly breached in that when I put Standing Order 106(3) to the transport committee, a conscious effort was made to ensure that members of the Conservative Party were not in attendance at that meeting of transport.
What I remind you, Sir, to consider in your deliberation is that when I asked the parliamentary secretary how many of his members were going to attend that committee meeting, his response was: "I am not sure. You will have to wait and see". That was not it, Mr. Speaker. His response directly to me was: "Stan, none are showing up today". That is a deliberate handcuffing of the committee.


Don Boudria: It is true. I was there.


Frederick James (Jim) Hawkes: Mr. Speaker, it is not normal in this Chamber for one member to claim that another member said something when that member is not here to deny or refute it. That is inconsistent with other rulings from the Chair on other occasions.


Mr. Speaker:: Perhaps the hon. member for Hamilton West could conclude his remarks and then we will hear him.


Stan Kazmierczak Keyes: Mr. Speaker, you have my remarks now on the record, just as the fellow member of the transport committee, the member for Thunder Bay-Atikokan, has quite concisely put the argument to you.
I would hope, Sir, that you would come to a speedy resolution on this debacle.


Don Boudria: Very briefly. Earlier on I referred to Standing Order 106. To be more precise, that was Standing Order 106(3) of our rules.


Mr. Speaker:: The hon. member for Kingston and the Islands, briefly. Then I will come back to the hon. member for Thunder Bay-Atikokan.


Mr. Peter Milliken (Kingston and the Islands):: Very briefly, Mr. Speaker. The chief government whip has requested that there be unanimous consent of the House to vote on the report of the striking committee. We are quite prepared to debate the report of the striking committee in this House and would like the opportunity to do so.
I would be delighted if the government on motions today would move one of the motions it has for concurrence in the report and debate it. I understand the government House leader does not want to do that. He would like to proceed with the government bill.
If the government Whip is prepared to move the adoption of the report, we are quite prepared to have a debate. Of course, ultimately, there will be a vote. But we feel it should be discussed in this House because what the government is doing to the committees of this House is wrong.


Iain Francis Angus: Mr. Speaker, I do not want to belabour the point. There are two items I need to raise, though. The chief government Whip made reference to the standard practice of the House adopting the striking committee report unanimously and without debate.
I would suggest to you, Sir, that the past practice of the striking committee report tended to be a unanimous report. It was not unanimous because there is a fundamental disagreement as to the proposal by the government to reduce our membership on a number of committees; from two members down to one.
The irony, Mr. Speaker, is that one of the most highly attended committees is the transport committee where we have had, in fact, more members in the opposition than we had seats at the table. It is one that we worked hard at to pursue the matters of transport.
I would also just like to add that we, too, would be happy to debate this at great length. Almost every one of my members is excited about the possibility of getting into this debate and that would also mean that a lot of House time would be used up.
October 30,1990

Obviously the government has to make a decision as to whether it wants to continue to pursue the striking committee report, which I am advised is amendable in this House. Regardless of the standing order that says that we report only once per year, that report is not only debatable, it is amendable.
At any time the striking committee could meet. Whether it is a striking committee or a meeting of the Whips, they could meet to work out a new approach that perhaps deals in some way with the government's concern about its ability to drag bodies back in from the constituencies in order to ensure that committees function in the way that the government would like them to, while at the same time protecting our membership.
I think there are options available that have not been explored yet, Mr. Speaker, but I would hope that your ruling would come down reasonably soon and provide us with some new direction.


Frederick James (Jim) Hawkes: Mr. Speaker, members opposite will know that it is a longstanding practice of the House that members with an interest in committee meetings can attend these meetings.
With very few exceptions, members who come and who are not normally members of the committee have a chance to participate. There is nothing in the striking committee report that obviates that basic principle.
If there are 10 members who want to come to transport, that is certainly something they could do. What we are talking about in terms of striking committee report and the size of the standing committees of the House is simply how many votes need to be cast.
We are paying close attention to the proportionality of the House, whether we are talking about a large committee or a small committee. We are simply talking from our point of view about whether members have to sit to warm a chair because we do not believe that that was the intent of McGrath.
We thought the intent of McGrath was for members to be knowledgeable, to be consistent in their attendance and to provide the House with good advice.
The suggestion has been made that we engage in a debate. If the motion is moved at any time during Routine Proceedings after notice, there is a two-hour debate. If people filibuster, then it is simply transferred
Routine Proceedings
to Government Orders and it has to be recalled as part of government business down the road. That is a very time consuming proposition for the House.
I make two suggestions to the members opposite. We might want to discuss it at the House leaders meeting later this day to see if we could come to a limited debate. If that is really what they want or if they want to filibuster the situation, it depends. We could go immediately to a division, which was my suggestion.
I would still like you, when I am done, to put that to the House. Is there unanimous consent for an immediate division on the principle? I think that would serve the House best in terms of getting on to resolve the problems that exist out there.


Mr. Speaker:: This matter was raised some days ago, and I have reserved on it.
I will consider very carefully what was said and include the representations that I have heard in my report back to the House.



ROUTINE PROCEEDINGS


Mr. Albert Cooper (Parliamentary Secretary to Leader of the Government in the House of Commons):: Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government's response to 28 petitions.
[Editor's Note: See today's Votes and Proceedings.] GOODS AND SERVICES TAX


Mr. Ross Harvey (Edmonton East):: Mr. Speaker, I have the honour and in some sense the pleasure this morning to present a petition under Standing Order 36 signed by a total 346 residents-mostly of Edmonton, but of other points in Alberta as well-calling on Parliament to reaffirm the historic principles embodied in tax free status for the printed word by retaining the zero rate in the GST legislation and regulations.
Especially in this year of literacy, that would seem to be sound advice indeed for the government.
October 30, 1990

Routine Proceedings VIA RAIL


Mr. Joe Fontana (London East):: Mr. Speaker, pursuant to Standing Order 36, it is my duty to present petitions to this House.
The petitioners are from Thunder Bay and London, Ontario, and other points where in fact people have been adversely affected by the VIA cuts. They ask Parliament and the government to rebuild VIA Rail, to give it an increased mandate to serve the public, especially in light of the great concern of Canadians about the congested highways and the environment.


Mr. Cid Samson (Timmins-Chapleau):: Mr. Speaker, it is a pleasure and an honour for me to stand today under Standing Order 36 to present two separate petitions.
The first comes from the good residents of Industrial Park in Halifax.
They call on the government to make improved service the highest priority of Canada Post and to instruct the government to abandon this policy of closing rural and urban post offices.
The petitioners recognize that postal services are a very essential and very important service to the members of that community and many others. They are calling on the government to cease dismantling of that excellent service.


Cyril (Cid) Samson: Further, Mr. Speaker, I have quite a number of petitions signed by residents from many, many different areas of the north: Moose Factory, Timmins, Wawa, and Iroquois Falls, to name but a few-


An hon. member:: South Porcupine.


Cyril (Cid) Samson: South Porcupine, to name another one. They are calling on Parliament to reject the recommendations of the committee report and to develop a fair and equitable tax benefit program for northern residents.
They are asking the Minister of Finance to recognize the financial needs of the people in the north and isolated areas and to reject the report put forward by the committee.


Don Boudria: Mr. Speaker, I have the honour and privilege to present a petition signed by a number of constituents of the Alexandria area.
These people are calling upon Parliament to ask the government to reject the budgetary measures that would cut back on veterans' benefits and allowances.


Don Boudria: also have a second petition, Mr. Speaker, that it is my duty to present in this House. The members across will understand why I use the word duty.
These people are asking me to present a petition to ask the Governor General to disallow Bill 178 of the province of Quebec.
Even though it is my duty to present this petition, it should not be misconstrued as my agreement with it, because it is not.


Mr. Robert E. Skelly (Comox-Albemi):: Mr. Speaker, I have the honour to present a petition from 1,044 of my constituents who reside in the Albemi Valley and who are complaining about the drastic cut-backs in service by Canada Post in the Albemi Valley.
Canada Post has cut of the drive-through mailbox services. It has taken local sorting out of the community and transferred it to Nanaimo, resulting in the loss of several jobs in Port Albemi. My constituents feel that if the management of Canada Post was not under the ideological protection of the Conservative Party, it would have been fired in a minute.
My constituents therefore request that Canada Post Corporation be instructed to keep existing outlets, operate longer hours, expand revenue generating services, stop privatizing and start increasing services to raise revenues.


Mr. Ray Skelly (North Island-Powell River):: Mr. Speaker, I have the honour to place before the House a petition protesting the implementation of the Mulroney GST.
October 30, 1990

The petition appeals to the House of Commons to rescind this repressive element of taxation. It is presented by residents of Iroquois Falls, Timmins, and Moose Factory. It also acknowledges the intent of the residents of Powell River, British Columbia to cash in every single Canada Savings Bond and to cancel their payroll deduction as a protest to the implementation, without a mandate, of the Conservative government GST.


QUESTIONS ON THE ORDER PAPER
Albert Glen Cooper: Mr. Speaker, I ask that all questions be allowed to stand.


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


Some hon. members:: Agreed.



GOVERNMENT ORDERS


Hon. Gilles Loiselle (President of the Treasury Board and Minister of State (Finance)) moved: that Bill C-83, an Act to revise and amend the law governing federal trust and loan companies and to provide for related and consequential matters, be read the second time and referred to a legislative committee.
He said: Mr. Speaker, in my introductory remarks to begin today's second reading debate of Bill C-83, I intend to deal lightly with technical details and concentrate more on the broad objectives we will achieve through reform of legislation and regulations governing federal financial institutions.
As you are aware, Mr. Speaker, the trust and loan companies bill we are considering today is the first of several bills that, along with new regulations, will modernize the rules governing federal financial institutions.
Government Orders
Other bills will include the Bank Act, the Insurance Companies Act and the Cooperative Credit Associations Act and related statutes. All of the new statutes are to come into effect on the same date.
The government's reform will break down barriers among the pillars of the financial sector-banking, insurance and trust and loan companies-and allow financial institutions to compete more directly with each other.

The trust and loan companies bill and the subsequent bills and regulations contain four essential elements. First, they establish rules for an ownership policy that allows for both closely held and widely held institutions.
Second, they establish a new framework for competition in the financial sector through the removal of many of the remaining rules that presently restrict institutions from fully competing with each other.
Third, they update prudential safeguards to reflect the new world in which financial institutions will operate.
Fourth, they modernize old statutes by adopting rules and procedures modelled on the Canadian Business Corporations Act.

The reform, Mr. Speaker, maintains wide ownership for Schedule I banks, including the six largest Canadian banks. This ensures that no one person or group of associated persons can own more than 10 per cent of any class of bank shares. These requirements are consistent with international rules and practices about the ownership of banks.
Large trust, loan and stock insurance companies will be required to ensure that at least 35 per cent of their shares are widely held and publicly traded within five years. Significant changes in the ownership of financial institutions will be subject to approval by the Minister of Finance, who will take account of whether transfers are in the best interests of the Canadian financial system.
Although these rules may appear to be technical adjustments, or tinkering, they are significant in part because they represent adjustments to an industry that is of major importance. All Canadians will be affected by

October 30, 1990
Government Orders
these changes-and for the better. The sheer magnitude of the industry makes an impact on Canadians inevitable.
There are more than 3,000 Canadian financial institutions, with assets of some $900 billion. Canada's 25 largest financial institutions hold assets of more than $760 billion. A total of 23 of these institutions are federally incorporated 23 out of 25.
The manner in which the federally incorporated financial institutions serve the needs of Canadians will be directly affected by the legislative and regulatory reforms we have announced. I sincerely believe, Mr. Speaker, these institutions will operate more effectively and competitively, and that they will be more accessible to meet the objectives of Canadians.
We must not forget that the money handled by Canadian financial institutions funds the mortgages of Canadians, finances our automobile puchases, shelters and invests our savings, and makes available the investment needed for new or expanded industries and businesses. The success of these institutions is key to our economic success, as well as our security as savers and investors.
Because of the particular importance of financial institutions in channeling savings to finance economic growth, it is essential that they be sound, innovative, dynamic and internationally competitive.
The challenge has been to develop a regulatory approach that protects the public while it encourages, rather than inhibits, innovation and efficiency in our financial sector. Mr. Speaker, I believe that we have met that challenge.

The objectives of this reform of financial sector legislation are to enhance protection for depositors and policyholders. They are also to benefit consumers by increasing competition and the spectrum of services offered by financial institutions. It will strengthen the ability of Canadian financial institutions to compete at home and abroad. It will lay the groundwork for harmonization discussions with the provinces. This is very important.
These goals will be achieved under the new legislative framework and regulations.

Honourable Members will recognize that in order to protect consumers, the government had already tightened up prudential rules in 1987. These will now be further strengthened, including additional enhancements to the supervisory system. I know that the hon. member for Nickel Belt, who monitors these issues very closely, will be very interested in this aspect of our legislation. For example, tougher self-dealing rules will be implemented, the self-policing role of directors and auditors will be made more effective through mandated roles and responsibilities, and the Superintendent of Financial Institutions will have increased powers to require information that will enable problems to be anticipated. The Superintendent of Financial Institutions is therefore being given the kind of access he did not have before.
Consumers will find shopping for financial services more convenient and will benefit from a wider choice of financial products since banks, trust and loan companies and insurance companies will be allowed to compete more directly with each other. The interests of the consumer will continue to be protected.
For example, the new Bank Act would also include the service charge disclosure provisions now contained in Bill C-9, which is before Parliament. By opening new avenues of growth for Canada's financial institutions the new regulations will strengthen the ability of these institutions to meet the new challenges that have evolved in the global marketplace.
Financial institutions will be able to diversify by owning institutions operating in other segments of the financial services industry. For example, banks and insurance companies will be allowed to own trusts; in addition, trust and loan companies and banks will be permitted to own insurance companies.
Together, Mr. Speaker, these proposals set out a framework for fair competition that will allow all insitu-tions to participate.

However, we are all aware that there are competing interests within the financial institution community which cannot be completely reconciled. In those cases we have sought a reasonable balance. For example, banks and trust and loan companies will be restricted from offering most insurance services, and retailing of most insurance products in branches of deficit taking
October 30, 1990

institutions will be prohibited. This ensures that insurance will continue to be sold by qualified licensed insurance brokers and agents working independently of any deficit taking institution.
At the same time, however, banks and trust and loan companies will be given the power to promote goods and services, including insurance to their credit hard holders. The government has spent considerable time consulting on its proposals with financial institutions and their associations. It has integrated these views with its continuing analysis of the needs of an evolving and dynamic market, both nationally and internationally. This process has led to firm, pragmatic policy decisions that are being put forward to Parliament.

This exercise in re-regulation represents a balancing of individual, national, international, federal-provincial and commercial and prudential concerns that will, as a package, serve the public interest well and permit our financial institutions to get on with the job.
The measures set out a framework for strong national institutions that serve the national interest. The reforms also respect provincial rights of supervision and authority in the financial sector.
There is a need for greater consistency among federal and provincial rules in order to avoid balkanization of regulatory regimes and permit our institutions to compete more effectively at home and abroad.
The new legislation and proposals take into account a number of concerns that have been expressed by the provinces regarding matters such as commercial links, the in-house trust powers of banks, and provisions allowing for improved sharing of information among federal and provincial supervisors of financial institutions. This opens the door to in-depth discussions with the provinces to clarify responsibilities for the supervision of financial institutions.
Co-operation between federal and provincial authorities is the most responsible way of ensuring the stability and growth of our national and regional financial institutions. This would reduce the possibility of regulatory and supervisory duplication.
Government Orders
The goal, Mr. Speaker, is to avoid, in pratical terms and to the degree possible, the multiple regulation of federal and other institutions operating in several jurisdictions. This approach could be designed to have institutions regulated as much as possible by their jurisdiction of incorporation.

Mr. Speaker, I believe we have much work before us. I hope that I can count, and I am sure that I can, on the co-operation of the House in expediting consideration of the bill now before us as well as the other bills that are to follow.
I believe that in the interests of consumers and in support of increased competitiveness for Canada's financial institutions, it is time for us to get on with the business of reform.


Ms. Catherine Callbeck (Malpeque):: Mr. Speaker, I am pleased to be able to speak in favour of the motion for second reading of Bill C-83 regarding financial institutions. I am pleased to do so mainly because modern legislation is urgently needed by the financial industry and we, as legislators, have a duty to help them compete in the new global market.
We also have an equally important duty to protect consumers and ensure the soundness of the financial system in Canada. I believe that all of these interests will be best served by getting this bill past second reading and into committee. Once in committee, we intend to conduct a very thorough study of the legislation.
The need for financial sector reform has become so urgent because this government has been incredibly slow in responding to the needs of the industry with new modem legislation.
The Conference Board of Canada refers to the: "repeated delays in financial sector reform and the urgency for policy makers to move ahead with new legislation in this area". It is in this spirit that we will be supporting this motion.
When the Minister of State for Finance last month tabled this trust and loan company bill and released the policy paper concerning banks and insurance companies, we in the opposition and those in industry, were extremely pleased because this government had finally decided to act. We were disappointed, however, that the government only introduced a policy paper on banks, not

October 30, 1990
Government Orders
a new Bank Act. We were disappointed for two reasons. One, without a new Bank Act, the government's picture of financial system reform remains incomplete. Two, the current act expires in five months, and when the act expires banks lose their licences.
Last week, the minister did introduce a last-minute bill that would extend the current Bank Act one year until April, 1992. This will prevent the chartered banks from losing their licences, but this last minute piecemeal approach has been typical of the way this government has been handling financial reform and many other matters.
The government's policy process started about five and a half years ago. First there was the green paper in April 1985, followed a year and a half later by a blue paper in December 1986. That was followed by promise after promise after promise by this government that new legislation was coming soon. The industry waited and waited and waited. Soon, it turned out, meant not in six months, or even in 12, soon turned into four years, during which the Canadian financial industry watched their global market share tumble.
For example, look at the Royal Bank, Canada's largest. According to the Economic Council of Canada, the Royal Bank ranked sixteenth in the world in terms of assets in 1981. Today, it is around 57th. In nine years the Royal Bank went from being 16th down to 57th. Consider the fact that during the early 1980s we had four banks in the top 50. Now we have none. Even countries much smaller than Canada, such as Switzerland, Hong Kong, and the Netherlands boast larger institutions than our own.
Look at international loans. Canadian financial institutions make only 3 per cent of the world's international loans versus almost 8 per cent seven years ago. That is a tremendous decrease in the last eight years.
Any way you look at it, Canada's financial institutions are facing fierce global competition. It is a war out there, but this present government, has been allowing our banks and other financial institutions to go out and to compete with one hand tied behind their back.
That is why I am very pleased to welcome this legislation concerning trust and loan companies which we are debating today. There are several reasons why this new financial legislation is needed in Canada. I spoke briefly about the first one, globalization. The others include the Canada-U.S. Free Trade Agreement, Europe 1992, and provincial deregulation.
First, globalization. Financial institutions have undergone massive transformation in recent years. As technology has advanced, geographical barriers have retreated, turning several international markets into one huge global market. Billions of dollars can be sent around the globe in a matter of seconds, 24 hours a day.
The globalization of financial markets has been driven by the needs of both borrowers and investors. For corporate and government borrowers alike, the search for the cheapest source of funds has known no national boundaries. Like individual Canadian consumers, those corporations and governments are price-shy and they go where the money is the cheapest.
For large portfolio managers and other investors, the incentive has been better investment opportunities and greater diversification of portfolios.
Canadian financial institutions are well aware of the potential advantages in this new global marketplace. In fact, Canadian Bankers Association president, Helen Sinclair says Canadian banks have "made a virtual obsession of the question of their role in the global marketplace".
Another major issue highlighting the need for financial reform is the Canada-U.S. Free Trade Agreement. The FTA changed the rules concerning financial institutions in two major ways. One, American banks entering Canada have had the limits on their asset growth removed and they can now open new branches without permission from the government. Two, Americans can now buy up to 100 per cent of any Canadian financial institution, whereas before they were limited to buying a total of 25 per cent.
Also related to the free trade agreement is American Express. It received government approval to operate as a bank in Canada, even though the company is not regulated as a bank in the United States, which is an apparent contradiction of Canadian law. It is not a contradiction of this government's policies because if
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one notes, permission for American Express to operate as a bank was given on election day, 1988, during the heat of the free trade debate.
Canadian financial institutions understandably felt that the playing field had been shifted in favour of the Americans. This was because the new AMEX Bank was owned by commercial enterprise, a type of ownership forbidden to Canadian banks. Clearly the issue of the level playing field in Canada is one that this reform package must resolve.
The free trade agreement also established the ground rules for another round of international negotiations, those surrounding Europe 1992. As the European Community moves towards a 12-country, 320 million person market, Canada must be involved. But in order to gain permission for its financial institutions to operate in that market, Canada will be under great pressure to grant to the Europeans the same privileges granted to the Americans under the free trade agreement, especially the exemption from the asset ceiling on Schedule 2 banks.
The second issue arising from Europe 1992 is the inability of Canada's federal government and the 10 provinces to achieve harmonization in financial institutions, compared to the 12 countries in Europe. Clearly, then, the government's new financial package must address federal-provincial harmonization.
In fact, the lack of Canadian harmonization is another force, a major force, pushing the need for reform. Several provinces, including Quebec, Ontario, New Brunswick, and British Columbia, have updated their legislation regarding financial institutions considerably over the past few years. While the federal government has been operating at a standstill, the provinces have been moving ahead.
The most far-reaching changes are taking place in Quebec which in 1987 introduced its blueprint for financial sector reform. These changes included the blurring of the four so-called pillars: the banks, the trust and loan companies, insurance companies, and securities dealers. They also included the acceptance of financial and commercial links, where commercial enterprise, such as a steel company, could own a financial institution such as a trust company or credit union.
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One of the most controversial effects of Quebec's reform is the ability of one credit union chain to sell insurance directly through its branches. This is one issue that the new legislation was expected to address. More than that, the new financial reform package was to have taken steps to level the playing-field for financial institutions regulated in different parts of Canada, with the goal eventually of establishing one set of rules for the whole country.
This levelling is very important if we are to avoid the spectacle of federally chartered financial institutions trading their federal charters for provincial ones. This would mean that the provinces, not Ottawa, would be the regulators in charge. This kind of movement would represent a reduction in federal authority, a loss of control to the provinces. The federal government must act now. It must act now to prevent such a loss of authority. It cannot continue to let the provinces take the lead in this issue.
After a long wait, the reform package unveiled on September 27 certainly was greeted with special enthusiasm by those of us who are eager to get on with federal-provincial harmonization of financial regulations. The provinces are certainly in this category and among them is British Columbia. British Columbia's Finance Minister, for example, said that he welcomed the government's package because, since the limited financial sector reforms by Ottawa in 1987, there has been, and I quote, "no meaningful dialogue between the federal government and the provinces on financial institutions reform".
Perhaps one of the reasons for not having any meaningful dialogue between Ottawa and the provinces is simply the fact that the government has consistently declined invitations by the provinces to sit on their interprovincial committee for financial institution reform. On September 28, the day after the reform package was tabled, I asked the Minister of State for Finance in the House why he had not accepted the provinces invitation. He simply ignored the question, just like he has been ignoring the provinces.
Before moving on to the issues raised by the government's reform efforts, I want to give a brief overview of Canada's financial industry. The four pillars to which I referred earlier are made up of the banks, the trust and loan companies, insurance companies, and security dealers.

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There are more than 3,000 Canadian financial institutions operating today in Canada and throughout the world. Together, they have close to one trillion dollars in assets. Through some 1,400 branches across the countiy and with close to half a million employees, Canadian financial institutions serve practically every individual and business in the countiy.
If anyone has ever had a mortgage, borrowed money to buy a car, deposited money in a bank, written someone a cheque, or purchased an insurance policy, they almost certainly had to go through a financial institution. These are the institutions that hold our savings, lend them to businesses and individuals, and operate our cheque clearing system.
It is probably safe to say that without financial institutions, our economy would simply dry up. Financing is extremely important to the economy, whether it is a large national economy or the small economy of Prince Edward Island, my province. Crucial to the development of my province is the establishment and growth of small business, which in turn is dependent upon adequate and low cost financing.
If Canada's financial industry becomes inefficient as a result of federal government neglect, or for whatever reason, the economy of Prince Edward Island, and of Canada, would suffer. Clearly then, the ability of Canada's banks and other financial institutions to survive and compete globally has a direct impact on their ability to provide relatively low cost financial services here at home.
I would like to address some of the major issues that have been raised by the government's reform package. These are issues that certainly must be resolved before meaningful reform of Canada's financial institutions can take place. I will deal with them under four separate headings: powers, ownership, regulation, and supervision.
The situation before this reform package came along is that trust and loan companies can, among other things, take consumer and commercial deposits and are involved in the mortgage business. They do not have full commercial or consumer lending powers yet. However, Bill C-83 will change that.
The first issue under the heading of powers is networking, or the ability of a financial institution from one pillar to offer its network offices to promote or to sell the products of an institution from another pillar.
As we know, Bill C-83 gives trust and loan companies natural personal powers or, in other words, allows them to engage in whatever financial activity is not expressly forbidden by law. The present trust and loan companies can do only what the law expressly permits them to do.
This kind of opening up of the financial services industry in principle is a good thing because it gives consumers more choice and it should ensure more competition. However, I wonder if the government knows what it is doing by throwing the market wide open in this way. What are the costs? What are the benefits associated with this new openness? Will the loss of jobs in the industries now protected from competition from trust and loan companies be matched by an increase in new job opportunities? These are the kinds of questions the government certainly should have asked before releasing its policy package. They are the ones that we will be asking in committee.
One of the most controversial network proposals contained in the government's package concerns banks selling insurance. The insurance industry has warned against letting banks sell insurance. It has argued that consumers will suffer a reduction in the level of service and that banks, with their huge network of branches, will grow to dominate the insurance industry to the detriment of fair competition.
Other issues under the powers heading include the question of whether financial institutions should be able to promote goods and services, including insurance, to their credit card holders and the whole question of allowing banks into the auto leasing business.
The auto leasing business is extremely important with thousands of jobs at stake. One opposition member told me that he had 15 auto dealers in his riding representing over 400 jobs. Clearly we have to deal with this issue very carefully, balancing the need for more competition with sensitivity to the local employment situation in Canada.
Under the ownership heading are issues such as closely versus widely-held ownership of financial institu-
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tions, commercial financial links, banks owning insurance companies, and the question of foreign ownership.
The ownership situation now is that trust companies can be closely held and can have commercial links. There are institutions such as Canada Trust, which has one major shareholder, Imasco, which owns a drugstore company, a tobacco company, and other commercial ventures. Many insurance companies are closely held, have commercial links, although some, mainly life insurance companies, are widely held and do not have commercial links.
Banks, on the other hand, cannot have commercial links and must be widely held, meaning that no one can own more than 10 per cent.
The issue of closely versus widely-held ownership is crucial because it deals with soundness of the financial system in Canada. A case can be made for either side, and I want to summarize very briefly both of those.
First, the broad ownership of financial institutions has come to be recognized by some as a very effective way of protecting the misuse of depositors' funds and self-dealing which might occur if there was just one major shareholder.
Second, widely held ownership is seen as preventing discrimination by a financial institution against potential borrowers who happen to be competitors of the institution's major shareholder.
There is also a case for closely held ownership. The first argument is that, while the stated goals of widely held ownership are admirable, the cost to the trust industry, for example, might be just too high.
They argue that if you are concerned about self-dealing and other abuses, there are better ways to guard against them than imposing strict ownership limits. They point to better regulation, bans on self-dealing and rules to expose conflicts of interest. This is the way to prevent these abuses, they argue, not imposing one ownership structure on all financial institutions simply because it sounds good in theory.
Turning now to the specific question of commercial-financial links, again we see strong arguments for and against. Those in favour of these links say a commercial parent would be able to increase the capital of the financial institutions, which is very important in such a competitive industry.
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Some say that the existence of a strong shareholder would also provide an opportunity to make the management of the financial institution more responsive to the wishes of its shareholders and less likely to grow stagnant.
Commercial links, according to this side, would also allow the parent institution to diversify its sources of revenue, thus contributing to the overall income stability of the group.
It would promote competition, they say, by encouraging the entry of new institutions into the market.
It would contribute to economies of scale in Canada, putting our domestic institutions on a better footing with respect to their global competitors. For example, a real estate company that owned a financial institution could sell mortgages, or a bank that owned a department store could use the store's network of outlets to increase its business. Both would be able to operate more efficiently and compete effectively with the large conglomerates from Japan and Europe.
Indeed, one argument for commercial-financial links is that Canada may have no choice but to allow them, given the growth of such links around the world, and even within Canada. Denying federally-chartered financial institutions access to such links, the argument goes, would be asking them to compete with one arm behind their back.
Finally, those in favour of commercial-financial links point to the case of the American Express Bank which has commercial links and is competing against Canadian banks which are denied access to such links. This present government, by issuing a foreign banking licence to a company that has commercial links, and indeed is not even a bank in its home country, has set a double standard.
The opponents of financial-commercial links counter that these links may lead to self-dealing, conflict of interest situations. Even for a financial institution that is otherwise well run, just the appearance of commercial interference could reduce depositor confidence in the institution.
They also argue that, just as a commercial parent could improve the balance sheet of the financial institution, just the opposite could very well happen and one would see an unhealthy commercial parent threatening the

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solvency of its financial subsidiary, and therefore its depositors.
They say the special role that financial institutions play in the Canadian economy is just too important to take the risk of something like that happening.
Financial commercial links would also increase corporate concentration by putting more assets and power into fewer hands.
Finally, opponents of such links argue that a commercial company in trouble could take advantage of Canada's system of deposit insurance by drawing on its financial subsidiary. One could have a situation where Canadian taxpayers were subsidizing the losses of a commercial corporation.
They point to a situation where the owner of a trust company, for example, is deeply in debt and draws on the trust company's funds to help itself out. The trust company could become threatened with insolvency and would have to be bailed out by the Canada Deposit Insurance Corporation, financed by other institutions and by taxpayers. Taxpayers, in other words, would be unknowingly bailing out a commercial company, representing an abuse of the deposit insurance system.
Another major ownership issue relates to foreign ownership of Canadian financial institutions. Canadian financial markets are relatively open. Allowing foreign institutions access to our domestic market has served to increase the competitiveness of the Canadian financial system generally, to the benefit of consumers. It has also allowed Canadian institutions the right to operate in other countries, thereby strengthening their operations back home.
Currently, foreigners can open financial institutions in all four pillars and may own 100 per cent of those institutions they create. They may also buy into existing institutions, but individuals cannot own more than 10 per cent of banks, while trust companies and insurance firms, and total non-U.S. foreign ownership cannot exceed 25 per cent. No restrictions apply to individuals or total foreign ownership of securities dealers.
Under the free trade agreement, however, Americans are exempted from these rules and generally have the same ownership rights as Canadians, in terms of federally-chartered financial institutions. Provincially-char-tered trust, insurance and securities dealers are not affected by the free trade agreement.
A major objective of any financial reform package, therefore, must be to encourage Canadian ownership of our financial institutions. We need strong Canadian financial institutions so they can look after Canadian interests first.
Turning very briefly to the areas of regulation and supervision, the primary concern is ensuring the solvency of our financial institutions. Threats to solvency come in various forms, such as self-dealing, where a bank, for example, makes a questionable loan to one of its directors.
Solvency could also be threatened by a conflict of interest. For example, where a trust company makes a questionable loan to a company affiliated with its parent
company.
There are now many rules in place to prevent such abuses, and Bill C-83 expands those rules. The question, however, is whether these rules go far enough to protect the solvency of our financial institutions, or whether they go so far that harmless, everyday transactions get hampered. This is an area that we will be examining closely in the legislative committee.
Finally, looking quickly at supervision, we see in the government's reform plan an enhanced role for the Superintendent of Financial Institutions in terms of federally chartered institutions. While I welcome that move by the government, I must remind it of the need for better harmonization of federal laws with the provinces, and I repeat my request that the Minister of State for Finance accept the invitation of the provinces to join their conference of ministers responsible for financial institutions so that there can be a meaningful dialogue between Ottawa and the provinces.
Mr. Speaker, I want to briefly summarize and conclude. Bill C-83 and the reform package put forward by the government are long overdue. They must be studied in the context of the fast paced world of global financial
markets.
We in the Liberal Party will support the motion for second reading of this legislation because we recognize
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the urgent need to have new modern legislation in place so that our financial institutions can compete globally.
This package raises many important and fundamental issues such as the proper role of financial institutions in Canada, protecting consumers and depositors, ensuring a level playing field between domestic and foreign institutions operating in Canada and among Canadian institutions from different pillars.
I look forward to dealing with these and other issues at the committee stage of the bill and to meeting with representatives from the industry, with consumers and other interested parties. I want to re-emphasize our party's commitment to a modem, competitive financial industry in Canada. We are also equally committed to protecting consumers, to enhancing their choices, to ensuring the soundness and stability of the Canadian financial system and to the harmonization of federal-provincial regulatory policies.
These are the principles to which we are committed. These are the principles we will be fighting for in committee.


Mr. John R. Rodriguez (Nickel Belt):: Mr. Speaker, I want to introduce to the House of Commons the image I have of the minister responsible for financial institutions and responsible for this bill. Here are these four pillars, pillars of the financial institutions of this country and here is this minister standing between these pillars. Like a modem day Samson, he is collapsing these pillars. One could ask how he can do this with as little hair as he has. We know that in Samson's dying days he had as much hair as the minister, but he summoned up his last ounce of strength. Here he is, this picture of a very huge person collapsing the pillars. It is an image that tickles my funny bone.
The minister talked about wanting to clear up conflicts of interest on boards and the relationship between the financial institutions and no self-dealing.
I want to start right at the beginning and lay on the table a concern I have before the bill goes any further, because this bill when it passes the House goes to the Senate. If you look at the litmus test of the senators in the other place, every single one of them-well, most of them-are connected to financial institutions of this country. I want to say to Canadians, do we have trust?
We must have an awful lot of trust to think that in fact this bill can go to the other place and have thorough examination without any interest being brought to bear by the activities of the senators in the other place. I have very serious concern about that because this government has refused to bring in effective conflict of interest legislation which binds senators in the other place as well as members of this House.
We will start on that note. I understand that the minister had choices. He had two choices on the one hand. Unlike the Liberals, I am not prepared to give carte blanche support for Bill C-83. As I think through Bill C-83 I want to raise questions. We will continue to raise those questions in committee.
However, I see on the one hand the minister having a choice of opening up the ownership of financial institutions and in fact removing the pillars completely. It has been suggested previously that in fact it should be open season. On the other hand, I look at the model that says: maintain the four pillars and streamline the regulation of those four pillars so that each one of them can be adaptable, can be flexible and can identify trends in the marketplace and react accordingly.
Therefore I raise the question: Is bigger better or is smarter better? I tend to think that smarter is better. God only knows the problems the Japanese banks are having. One only has to look at Chase Manhattan these days and see the problems it has been running into.
Let us look at the savings and loans. I have also heard in this House that we have to build institutions that can compete globally. That is the argument I heard with respect to airlines. I heard that what we had to do was deregulate the airline industry because that is what encourages more airlines to become involved in transportation in Canada and that by having more airlines there would be more competition and lower prices.
That works fine in theory and on paper. In reality the opposite has happened. In fact I would predict that in the next couple of years we will probably have one Canadian airline operating in this country with disastrous effects for people who live in the regions in terms of quality of service, price, and safety.

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The minister had these choices. What I think he has ended up with in Bill C-83 is gradualism, deregulation by gradualism. Let us look at the scene: banks can own insurance companies, insurance companies can own trust companies, trust companies can own insurance companies, trust companies can own banks, and banks can own trust companies. Donald Trump would have a hey-day.
I do not know. The minister has now suggested that we will protect the interest of investors by having firewalls. We are now into the construction business. We are going to be putting up firewalls all over the place. Banks can own an insurance company, but they cannot market the insurance products through their branches. So we can have the scene, Mr. Speaker, of a building with a bank in one half, a firewall, and the insurance company in the other half.
The minister says: "Aha, we will have an arm's length relationship. You will be able to market the insurance through credit card holders." Junk mail, here we come. Canadians better hold on to themselves because here comes an onslaught of junk mail. We are going to get all sorts of promotions through the mail with respect to the credit card.
We are concerned in this party about consumers. Will consumers benefit? That is the question. Will consumers benefit through lower prices for the services provided? Will it be more convenient? Will there be a variety? Will they have protection with respect to the service charges?
The minister says that the services charges outlined in Bill C-9 will be included in the Bank Act, but they certainly will not be applied to the trust companies; only to the banks. Trust companies are going to be doing exactly the same thing as banks in terms of their customers, yet consumers would not even have the protection of this powder-puff bill which I consider Bill C-9 to be. Even that protection is not going to be there for consumers.
How will consumers benefit? I suspect that once the shakedown takes place Canadians will wake up one morning and find that one bank owns all the financial institutions in this country. Surely, if we believe that there should be competition because that is what creates better services, lower prices and more convenience, it is not to open up the game so that power is concentrated in
one bank or one trust company. Surely the whole idea is to permit many players into the marketplace. That is the classic argument that Tories ought to be putting forward, not to be supporting those practices that lead to monopoly capitalism. That is not the way to go.
The bill does not include any changes to the $60,000 insurance protection for depositors through the Deposit Insurance Corporation. There is no increase in the $60,000 level. It remains at $60,000. The protection for consumers-not in the specific services received but in the over-all administration and supervision of the provisions of this bill-will rest with the director of financial institutions. He is given an enhanced role in this legislation.
Will the government increase the staffing to the Superintendent of Financial Institutions? It is great to have a whole series of laws, but if we do not have the cops to enforce the law then the law is meaningless. It is not enough to talk about all the improvements, all the laws and all the changes that will come, unless we are prepared to increase the supervision.
We have a question: How do consumers benefit from Bill C-83? How do they benefit specifically? I am unable to detect from Bill C-83 how they will gain any benefits from this legislation. On the one hand we have the problem of greater concentration of economic power. This is the danger that I think this bill will lead to. On the other hand we would argue-and I have a question in my mind-as to whether maintaining the four pillars and streamlining them would be better. I want to explore the idea that rather than to collapse them it is better to streamline and ensure that there is competition in the field for which that particular pillar is operating.
We noticed, for example, that banks were not allowed to own brokerage houses. Then that was changed. Every single bank bought out a brokerage house. Now the bank has in its stable a brokerage house. I think there is only one bank, the Toronto-Dominion, that actually started to form its own. All the others bought out brokerage houses. We can see where this is headed. The banks will then buy out insurance companies. They will set up these firewalls as required by the law. Then those will break down.
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In the legislation the governments says that it has tightened up the ownership. The banks remain at 10 per cent. No person can earn more than 10 per cent of the shares of the bank, while for trust companies and loan companies it is a lot looser. The government also says in the bill that it will tighten it up, that it will prohibit self-dealing, conflicts of interest, and a whole host of other practices, and that it will make the boards of directors more democratic.
This is why I think there is a gradual move to loosening up the whole field. If that is the case, why do they need to maintain the 10 per cent ownership in banks? Why is there a need to maintain the 10 per cent? If they have these tighter rules about self-dealing and conflicts of interest, why did they keep the 10 per cent rule? I have not had an answer to that question.
Even with the ownership it raises another question about the way we treat Canadians as opposed to the way we treat Americans. A Schedule II bank can come in to Canada, yet the 10 per cent rule would not apply to that bank. However, a Canadian could not establish a bank in Canada unless he obeys the 10 per cent rule.
Why is it that we are permitting aliens to be treated differently than we treat Canadians? Why are we permitting a foreigner to do something in Canada that we would not permit a Canadian to do?
One can have a bank in a state but one cannot go and establish in another state and another state. I wanted to point that out. I would say that in itself that is discriminatory. That is a question we wanted to raise.
On the question of bank services charges, we did a study on that area and we made recommendations to the government which came in as legislation in Bill C-9. One would think that consumers would receive the protection of that pussycat legislation, but in this bill it only applies to the banks. It does not apply to trust and loan companies.
It seems to me that by collapsing the pillars and allowing the trust and loan companies to do the things that banks do, by erasing the differences, then surely when we impose things such as disclosure and the way we treat certain bank services it has to apply to the trust and loan companies as well. Yet we find that they are exempt from this. Mr. Speaker, we cannot see why this would be so. In the bill, the way to calculate interest is set out for
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the banks and for the trust and loan companies, so it seems to us that it is a short step over to cover the trust and loan companies with the bank service charges as set out in Bill C-9. It seems to me that that is logical.
We also have the impression that the area of ownership of the banks in Canada, this 10/25 rule that I mentioned, not only permits a non-Canadian, an American specifically because of the free trade agreement, to come into Canada and be treated differently from the way Canadians are treated. It also raises the question as to whether a Canadian can buy an American bank and then have that bank come in as a Schedule II bank and, in effect, avoid the 10/25 rule.


An hon. member:: I'm not sure.


John R. Rodriguez: The member says he is not sure. Well, I raise that because, while the officials have said these are guidelines, there is nothing in Bill C-83 that says it cannot be done. Schedule II banks can do just about anything that a Schedule A bank can do. We are concerned about that and we want to have that question cleared up as well.
We are also concerned about the role of the Superintendent of Financial Institutions. I mentioned one aspect of it. We think that he has to be provided with the wherewithal to enforce the act.
There is another aspect of this which was included in the 1986 blue paper. It was one of the proposals, and we do not see it reflected in this bill and we want to know why it is not. The bill gives the government the authority to vest all of the capital of the institution with the CDIC, where the institution is threatened with insolvency, and the affairs of the institution would be managed by the CDIC to affect a merger or sale of the assets, as it deems necessary. We notice that that is not included in the bill. We would be interested in knowing why that was not included.
Mr. Speaker, these are questions that we have to raise with respect to Bill C-83, because the bill is of such importance. Once this bill gets put into place, it has far-reaching implications. I see this bill, frankly, as a gradual removing of all the pillars and so we must take a good hard look at the way in which it is being presented. Quite frankly, I am interested in the arguments of the witnesses who will come before the committee to outline their own positions and to answer questions.

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We know that the banks have wanted to be able to market insurance through their branches. I am not sure if they asked the government to give them the power to own insurance companies. I am not convinced in my own mind as to whether the lesser of the two dangers is to allow them to market the insurance through the branches, or to own the insurance company. I would tend to have a preference for them to market the insurance through the branches at this point in time, but I am prepared to listen to the argument as to why they should be allowed to own the company.
It seems to me that one of the advantages of being able to market the insurance through the branches might be to provide convenience to the consumer. The greater danger is that the banks under Bill C-83 could end up owning more and more of the financial institutions in the marketplace. That is the concern I have.
It is also well known that the banks had approached the government with respect to being able to lease automobiles. We know at the present time that they are in leasing. They do lease farm and construction equipment-over 20 tonnes, I believe-so to some extent the banks are involved in leasing. I am prepared to listen to the argument as to why they should be denied the ability to lease cars. I am also prepared to hear the argument for the other side.
We have to see the details of this three-tier regulation which the government has outlined in Bill C-83 with respect to self-dealing. We have, in this party, long expressed concern about the fact that trust companies could be subject to self-dealing. The minister has now promised in Bill C-83 that self-dealing will be outlawed, and that there would be a whole host of regulations with respect to tightening up and ensuring an arm's length relationship between a financial institution and any of its subsidiaries or any of its owners.
We would welcome any regulations which tightens up this whole area. We supported it in the past, but we would like to see the form that the regulations take.
The government has promised a new change in the structure of the board of directors, new rules with respect to conflicts of interest on boards of directors- banks particularly-where a person sitting on a board of directors of a bank but connected closely to a large
corporation would be able to obtain loans from a bank for activities other than their ongoing process of business. We have expressed concerns about that in the past. We understand from what the minister has outlined in Bill C-83, that there will be a new era with respect to this whole area of conflicts of interest on the boards of directors of banks.
As I said, this bill is far-reaching. It is not a simple bill. It has implications beyond what is here. It opens up a whole new era. The potential down the road for concentration of economic power is very great. We are concerned that once barriers come down, no control will be exerted by the state on the flow of capital around the world, out of Canada and into Canada. We have concerns about that. What we will be looking for very closely is the way in which when these pillars are collapsed. What is the rationale for collapsing a pillar? What is the long-term view of financial institutions? What kind of financial structures do we want in this country? Do we want a wide-open, loosey-goosey, catch-as-catch-can, take-over-as-take-over-can approach? Is that what we want? Or do we want financial institutions that have been set up to do certain specific things and do them well. These are the kinds of issues that Bill C-83 raises.
We know that the trust and loan companies acts have not been amended since 1914, and a lot of water has passed under the bridge since then. It is important to update the acts governing these particular institutions. We know there is a need to harmonize the laws federally with those laws that affect those institutions provincially. We understand that, but we believe that in doing so, we must not throw out the baby with the bath water. Are we on the path to creating a Frankenstein, that down the road it will be very difficult to put back into the coffin? This is the crux of the problem.
We have concerns about banks buying out insurance companies, insurance companies buying out trust companies, trust companies buying out banks, banks buying out trust companies, trust companies buying out insurance companies, and on and on. The more complex the game gets, the more the loopholes become apparent and in the long run, consumers suffer and pay the price.
We approach this bill in the spirit of seeking answers because we want to make sure that when this bill is passed that, in fact, it can be the hallmark, the foundation of the way in which financial institutions serve this
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country and not the other way around, that people serve these financial institutions.
We look forward to the bill going through second reading and we hope that the concerns we have raised will be noted and addressed. If they are not addressed, we will look for opportunities to amend the bill in committee.


The Acting Speaker (Mr. DeBlois):: It being one o'clock, I do now leave the Chair until two o'clock this afternoon.
At 1 p.m. the House took recess.


[Stage Direction]
AFTER RECESS The House resumed at 2 p.m.

Mr. Speaker:: I have the honour to lay upon the table the Report of the Auditor General of Canada to the House of Commons for the fiscal year ended March 31, 1990.

Consequently, pursuant to Standing Order 108(3)(e), this document is deemed permanently referred to the Standing Committee on Public Accounts.


STATEMENTS PURSUANT TO S. O. 31
Mr.   Brian@: Mr. Speaker, one of the most important aspects of Canadian culture is amateur sport. Canadian college football's Vanier Cup, named after a former Governor General, is one of the few truly national sporting events. It is a Canadian event played between Canadian teams by Canadian athletes.
CBC radio has broadcast almost all the Vanier Cups live since the first game in November, 1965. However, CBC radio's program director in Toronto has apparently decided that this year's November 24 game at the SkyDome will not be broadcast because, as she puts it, sport in general and the Vanier Cup in particular have limited cultural and historical significance.
Canadians from sea to sea want to listen to the Vanier Cup on CBC radio. I would encourage CBC radio to reconsider its decision and broadcast the 1990 Vanier Cup.


Mrs. Beryl Gaffney (Nepean):: Mr. Speaker, nearly 70,000 newborns have been tested for AIDS without the knowledge or consent of their parents. Worse yet, the parents of the 21 babies, and 6 are from the Ottawa area, who were subsequently found to have the HIV antibodies were not informed, nor has a record been kept of the names of the infants. This is a terrible abuse of the rights of parents.
The University of Toronto, with funding from the Department of National Health and Welfare, has been carrying out these tests. Although its procedures may be legal, I have to seriously question the ethics.
Research into AIDS is vital. The minister must look into methods, which are acceptable to the general public, of conducting necessary studies, but also that tests be documented to enable parents and doctors the proper mechanism of tracing the possible transmitter of the virus.


AUDITOR GENERAL KENNETH DYE
Mr. Jack Whittaker (Okanagan-Similkameen-Merritt):: Mr. Speaker, today, the tenth and final report of our Auditor General, Kenneth Dye, is tabled. In those 10 years he has served his office well and the people of Canada even better.
In his report today he says, "I came to Ottawa because I had been intrigued by my predecessor's innovative ideas about comprehensive auditing. I also like constructive change and thought I could contribute to the advancement of accountability, perhaps implanting the

October 30, 1990
notion that public servants should spend people's money as carefully as they would their own."
He has pursued these ideals relentlessly through his 10 years and can retire from his job content in the knowledge that, although there is much work yet to be done, he has successfully focused government attention on efficient and effective use of public funds.
The New Democratic caucus wants to extend our thanks to Mr. Dye for his hard work over his 10 years as Auditor General and wish him much success in his transition back to private life.


CANADA CAREER WEEK
Mrs. Edna Anderson (Simcoe Centre):: Mr. Speaker, Canada Career Week is not just an opportunity for youth to learn about the career opportunities available to them, but it is also an opportunity for all of us and for adults everywhere to look at the contributions we can make toward encouraging our youth to complete their training.
The most important thing we can do is change our attitudes toward skills training and non-academic education. We must realize that a student who does not excel in English literature is not less intelligent than the student who does. They have different aptitudes but both are equally important to our communities and both deserve the same amount of encouragement and respect.
Through education, we give our youth self-reliance and an opportunity to be productive adults. By encouraging our youth to be the best they can be-bricklayer, welder, teacher, scientist, or whatever-we instil self-respect and self-confidence which, in turn, promotes a healthy regard for the achievement of others. Investing in skills training is an investment that keeps on giving us a return. I cannot think of another investment with such guarantees.


USE OF CHALLENGER JETS
Mr. Jean-Luc Joncas (Matapedia-Matane):: Mr. Speaker, yesterday, the President of the Treasury Board
tabled a report on the use of the federal government's six Challenger jets. Incredible but true, Mr. Speaker: there has been a 40-per cent drop since the Conservative Government was elected in 1984.
Under the Liberal government, which means until August 1984, the Liberals took 672 flights in twelve months. In two twelve-month periods, in 1989 and 1990, the Conservative Government used the Challenger jets 258 and 301 times, respectively.
Mr. Speaker, this is one more example of good management by this government.


GOODS AND SERVICES TAX
Ms. Beth Phinney (Hamilton Mountain):: Mr. Speaker, my constituents of Hamilton Mountain, as well as most other Canadians, are worried about the effect the proposed GST will have on their standard of living. I would like to point out to Canadians yet another flaw in the government's proposed new tax.
Close scrutiny of the GST shows that not all Canadians will be treated equally under this new tax. For example, stockbrokers' fees will be GST exempt. Commissions charged by other professions, such as auto dealers, real estate agents, and art brokers, are all taxable. Yet the commissions charged by stockbrokers are exempt. Is it not interesting that the Minister of Finance cannot find a way to tax his former colleagues and employers?
When a government introduces a piece of legislation that will hit the poor and the elderly the hardest and gives the boys on Bay Street a break, it should come as no surprise that the Liberal caucus, under Jean Chretien, would vow to scrap such a tax.
Many alternative forms of taxation exist which are fair, equitable, simple, and visible. This is the type of taxation that Canadians have come to know under successive Liberal governments. I salute the foresight of my Liberal colleagues in the other place as they attempt to-


Mr. Speaker:: The hon. member's time has expired.
October 30,1990


TRIBUTE TO MARCO MAIOLO
Hon. Bob Layton (Lachine-Lac-Saint-Louis):: Mr. Speaker, it was a great pleasure to join the Prime Minister yesterday in a celebration for Marco Maiolo at the Meadowbrook School in Lachine, Quebec.
Marco is the one millionth student to enrol in the Seeds Program for energy awareness.
The program was set up in 1976 to make students aware of the importance of energy and of the challenge to produce energy while protecting the environment.
In recognition of the contribution of the Seeds Foundation to education and to mark the enrolment of the one-millionth student in the program, the Prime Minister gave Marco Maiolo a certificate to commemorate the occasion and congratulated him, also on behalf of the Government of Canada.
I can only applaud the achievements of this program and I want to congratulate Marco and wish him every success with his studies.


Mr. Speaker:: The hon. member's time has expired.


CRUISE MISSILE TESTING
Mr. Dan Heap (Trinity-Spadina):: Mr. Speaker, two years ago the government said it would continue testing Cruise missiles in Canada until progress is made on disarmament.
Two years later, the Cold War is over. Gorbachev is reducing Soviet arms and dissolving the Warsaw Pact. He has offered to make the Soviet Union a non-nuclear-weapons state if NATO will do the same.
Why is the government promoting war fever by testing the Cruise missile over northern Canada today? When will the government contribute to peace by ending the testing of the Cruise missile in Canada?


ROUGE RIVER VALLEY
Mrs. Pauline Browes (Scarborough Centre):: Mr. Speaker, for nearly eight weeks, the New Democratic
Party of Ontario has failed to respond to one of the most important environmental issues, the proposed dump in the Rouge Valley.
While in opposition, the NDP stated there would be no dump within the magnificent Rouge Valley system of Scarborough. With the federal government pledging $10 million to save the Rouge as a park, Bob Rae has failed to put a stop to provincial lands in the Rouge from becoming a dumping ground.
I say to the Premier of Ontario: "You have been given your chance. Lack of action has shown the people of Scarborough and all of Metropolitan Toronto that the total environmental protection of the Rouge Valley is really not on the NDP agenda."


HOUSING
Joseph Frank (Joe) Fontana: Mr. Speaker, while the government has pushed interest rates to the 14 per cent mark, it is ignoring the hardships it has imposed on Canadians.
Housing starts are at their lowest level in six years. Home sales have plunged 30 per cent compared to last year and the construction industry is expected to have an unemployment rate of 15 per cent.
Across the country, families earning $40,000 or $50,000 a year are defaulting on their mortgages, a jump of 41 per cent in the last six months. In Toronto hundreds of homeowners have already had to give up their properties and default on their dream homes.
While the Tories stick to their destructive high interest rate policy, CMHC has predicted a continued rise in defaults in the coming year. The Canadian Real Estate Association, meeting here in Ottawa today, is under no illusion as to what the problem is. It is interest rates.
As the unemployment rate increases and interest rates push housing prices higher and higher, hundreds of thousands of Canadians are shoved out of the market to buy their first home.
This is the price Canadians are paying for the government's inflation-fighting tactics. The long-term damage to the Canadian economy is a price not worth paying.

October 30,1990


LIBERAL PARTY OF CANADA
Mr. Greg Thompson (Carleton -Charlotte):: Mr. Speaker, here we go again. We have heard it all before. Jean Chretien and the Liberal Party are telling Canadians they will scrap the GST if elected.


An hon. member:: That will never happen.


Some hon. members:: Hear, hear.


Gregory Francis Thompson: But can we really believe them? Not if you look at Liberal history, Mr. Speaker.
Remember the 1974 election? The Liberals promised us no wage and price controls. What happened less than one year into their term? We had price and wage controls.
Then, in 1980 the Liberal Party forced an election over a proposed 18-cent per gallon gasoline tax, and what happened? By the time they were turfed from office in 1984 gas prices had risen by 99 cents per gallon.


An hon. member:: Shame.


Gregory Francis Thompson: This latest announcement is another signal to Canadians of the Liberal Party's cynical approach to government. And yes, Mr. Speaker, we have heard it all before.


Some hon. members:: Hear, hear.


NSC DIESEL INC.
Mr. Ron MacDonald (Dartmouth):: Mr. Speaker, I rise today to bring to the attention of the House a scandalous example of program abuse and ineptitude by officials of ACOA and, indeed, perhaps the minister responsible.
I refer of course to the circumstances surrounding the approval of a $12 million loan to a company owned by Rick Black, NSC Diesel Inc.
Even before the building was finished, the company's orders dried up and its business plan was found to be total fabrication. The result is dozens of contractors who extended lines of credit now facing bankruptcy themselves, hundreds of their employees losing their jobs, and more economic misery for the people of this part of Nova Scotia because of this fiasco.
Now that the federal Auditor General, in response to my request to review this smelly deal, has concluded that program assessment criteria were not followed, it is time for a full public disclosure on how this deal got funded, who was zooming who, and for heads to roll, starting with the minister responsible.


KIDS HELP LINE
Ms. Joy Langan (Mission-Coquitlam):: Mr. Speaker, imagine, if you will, being on the receiving end of a call from a four-year old child who wants to know how to commit suicide. Imagine the pain in that child's life.
Twenty-five thousand children a month make calls for help to the Kids Help Line. On Monday, two of their phone lines will be closed. Based on last year's statistics, this means that over the next six months 100,000 kids will not be responded to by the hot-line, 2,000 suicidal kids will not receive counselling, and 9,000 kids who are the victims of family violence will not have access to a counsellor.
This service has proved itself invaluable in direct intervention and now has over 300,000 pieces of data on the nature of the difficulties faced by children in Canada. Surely the new minister responsible for children will not let this proven program deteriorate when the need is so great. Could the $72,000 the government used promoting the children's summit have been better spent?


Mr. Stan Darling (Parry Sound-Muskoka):: Mr. Speaker, today marks the 18th anniversary of the political class of 1972. That is those members of Parliament who were first elected on October 30, 1972, went on to consecutive and unbroken re-election victories and are still presently members of the House of Commons. Believe me, given the uncertain fortunes of political life these days, that is no small feat.
On October 30, 1972, 59 Conservatives, 23 Liberals, 11 New Democrats and three Socreds were elected for the first time. Mr. Speaker, you and I are counted among that number. Of those members there are only 11
October 30, 1990

Conservatives and two Liberals remaining with unbroken records.
In the Liberal caucus there remains Jean-Robert Gauthier and the Hon. Bill Rompkey. In the Conservative caucus we have you, Mr. Speaker, the Hon. Harvie Andre, the Hon. Perrin Beatty, the Right Hon. Joe Clark, the Hon. Paul Dick, the Hon. Jack Epp, the Hon. Otto Jelinek, Bill Kempling, Gus Mitges, Frank Oberle and myself.
To all, I say we have much to be proud of, for as political survivors, we are all too rare in public life these days.



ORAL QUESTION PERIOD

[Stage Direction]
[English)

Mr. Len Hopkins (Renfrew-Nipissing-Pembroke):: Mr. Speaker, regardless of all the rhetoric and press releases delivered by this government to try to make people believe that they are being open and above board in their operations, this government is still denying the Auditor General of Canada his statutory authority to audit ministerial expenses.
I ask the President of the Treasury Board this: Why will the government not put its words into action and hand over minister's receipts so that the Auditor General can perform his duty on behalf of the taxpayers of Canada?


Gilles Loiselle: Mr. Speaker, I thank the hon. gentleman for at least recognizing that we are coming forward with a lot more information than his party did when it was in power.
As a matter of fact, we are following a role that it established. We have made public information as promised by my predecessor, the former President of the Treasury Board, on government travel, minister's travel and aircraft travel. I think we have come a long way in satisfying the Auditor General.


Leonard Donald Hopkins: Mr. Speaker, I can tell the minister that he has not satisfied the Auditor General in any way.
Oral Questions
As chairman of the Public Accounts committee, I have written to the government asking it to provide those receipts for the Auditor General. Our Public Accounts committee has had the Privy Council Office, the Comptroller General of Canada and the Treasury Board before our committee. We have been stonewalled at every turn. This federal government is the only jurisdiction in all of Canada that still denies this information to its Auditor General. Surely the taxpayers of Canada must wonder what this government has to hide.
What is the government's real reason for denial of this important information to the Auditor General of Canada? We are living for the future, we are not living for the past.


Gilles Loiselle: Mr. Speaker, even in the present, the government is taking major decisions.
If the hon. gentleman looks at the report that we have produced, he will see that the number of flights by government ministers has been reduced by some 40 per cent since 1980. What the government is concerned with is its real savings and real management of public finance and it has done that by maintaining public expenditures lower than they have ever been, lower than all the provinces. The government has cut $25 billion in the management since 1984, starting with a deficit of $16 billion to a surplus this year of $9 billion, 70 per cent of that being from expenses reduction. That is what the government is proud of.


Leonard Donald Hopkins: Mr. Speaker, if the government is so pure, why does it not co-operate with the Auditor General?
Mr. Speaker, I am not getting answers there, so I will follow up the Auditor General's report with a question to the Minister of Transport.
The ice-breaker St. Laurent was out of service for five years. The minister will be well aware of the fact that four years ago, a Halifax contractor was granted the job of refitting the ship at a cost of $51 million over a period of two years.
Now, two years overdue, the work on the ship is still ongoing, and the cost has risen to $125 million. That is the kind of financial management we are looking at. What is the government going to do about this fiasco?

October 30, 1990
Oral Questions
How can the government possibly justify increasing taxes at a time when it is wasting public money in this way?


Hon. Doug Lewis (Minister of Transport):: Mr. Speaker, the approved cost for this project was an estimate. That is all it was.
The refitting work began. It was impossible until they opened up the ship to determine exactly what problems would be encountered. Modernizing the Louis St. Laurent will improve our ice-breaking capacity. That may not matter much in Pembroke and Renfrew, but it matters to your colleagues from the maritimes.
I think you should have checked with them before you asked that question.


GOODS AND SERVICES TAX
Mr. Douglas Young (Acadie -Bathurst):: Mr. Speaker, the Auditor General has warned the government that it may suffer severe losses upon implementing the goods and services tax because the system to administer the tax will not be adequate.
Mr. Speaker, the Auditor General is worried because the GST will collect $2 million every hour, twenty-four hours a day, 365 days a year. I want to ask the Minister of Finance whether he is prepared to acknowledge that the goods and services tax will be a real nightmare, both for business and the government, and that this tax proposal should be cancelled.


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, I do not accept that. We have worked very closely with people in the private sector. We have also heard from those people that the concerns that have been expressed about the complexity of the GST are not well founded.
Also, we know that the federal sales tax today is a very complex tax. What I think most Canadians are interested in is the position of the Liberal Party of Canada.
Let me read some headlines here. After the speech last weekend: "Waffling Jean," "Chretien does an about face on the GST," "Who will bear the costs of Senate delay?", "Liberal senators should reconsider their actions," "Gut the GST now-"


Some hon. members:: Hear, hear.


M. Douglas Young: Mr. Speaker, a supplementary.
The Canadian Federation of Independent Business, representing small business in this country, says that the goods and services tax will be an administrative nightmare.
The minister says that the Auditor General's concerns are not well founded, but he knows that the goods and services tax is going to collect more than $2 million an hour, 24 hours a day, 365 days a year.
Is the Minister of Finance going to pursue his deadly scheme of imposing the goods and services tax on Canadians? Does he realize that the time for Tory tax trick-or-treat games is over and he should withdraw the goods and services tax?


Michael Holcombe Wilson: Mr. Speaker, if there are any trick-or-treat games, it is Jean Chretien playing them on the Canadian people.


Some hon. members:: Hear, hear.


Michael Holcombe Wilson: April 6, 1990, Jean Chretien said that it would be irresponsible to say now that a Liberal government would scrap the GST. "That is $28 billion. At this point, I will not say I will abolish the GST. I won't say I'll keep it either."
What we do know is that Jean Chretien back then would not say that he would scrap the GST without knowing where the money is coming from. Does Jean Chretien know today where the money is coming from? Does he have any idea how he is going to change the tax system? Is it going to be from consumption tax? Is it going to be personal income tax?


THE ENVIRONMENT
Mr. Jim Fulton (Skeena):: Mr. Speaker, the Auditor General has confirmed what most Canadians have long suspected, that despite six years in office this government does not have a comprehensive strategy for dealing with environmental issues.
My question is directed to the Minister of the Environment. The Auditor General has found that the ocean dumping program deficiencies could have serious environmental consequences, deficiencies that were known but were kept secret from Parliament.
October 30, 1990

Since the Auditor General could find no evidence that the department had any scientific basis for informing Parliament that ocean dumping was being permitted in a safe and regulated manner, will the minister assure the House that from this date on, there will be no permits issued for ocean dumping until an effective, scientific monitoring system for existing and proposed disposal sites is fully in place?


Hon. Robert de Cotret (Minister of the Environment):: Mr. Speaker, I can only say that the Auditor General also mentioned that action has been taken by the department to resolve the deficiencies noted for the two 1988 examples and the 1989 ocean dumping regulatory program. There is an action plan in place right now. The action plan consists of improvements to scientific support for the program, including research; improvements to dump site monitoring; increased compliance and enforcement activities; and amendments to ocean dumping regulations, including changes to permit fees to make them comparable in cost to other disposal alternatives. So, we are certainly acting on this issue very actively.


James Ross Fulton: Mr. Speaker, I would have hoped that the minister could simply have said yes.
In a shocking indictment of the effects of delegating authority to provincial enforcement agencies, the Auditor General reveals that between 1982 and 1988, the percentage of mining companies breaking the law in Canada leaped from 15 per cent to 52 per cent. In many cases, the level of dumping has occurred at triple the safe allowable levels.
A 240 per cent increase in crime, what a Tory success story.
Will the minister assure the House that this rampant illegal activity will be halted immediately and that charges will be laid against the provinces and those companies that are in violation of federal law?


Robert René de Cotret: Mr. Speaker, with respect to the problems that we are encountering in the mining industry, I would like to tell my hon. colleague that we have established a number of conventions with mining establishments across the country, that enforcement is being increased and the increase will be enforced through measures that will be announced in the green plan.
Oral Questions


Mr. Len Taylor (The Battlefords-Meadow Lake):: Mr. Speaker, it seems that the minister is confirming that the Auditor General is right, that this government does not have a comprehensive strategy for dealing with environmental issues.
The Canadian Environmental Protection Act in 1988 provided for agreements to be negotiated between Ottawa and the provinces concerning regulation and enforcement of toxic substances. There are, at the moment, no agreements signed and the levels of toxic and hazardous materials in our environment continue to climb.
My question to the Minister of the Environment is when will this government take action on these agreements concerning toxic substances and hazardous material?


Robert René de Cotret: Mr. Speaker, I would like to assure my hon. colleague opposite that toxics are very much at the forefront of our environmental agenda. It is an agenda that is, by the way, quite comprehensive, probably the most comprehensive in the world. We are looking at toxics and a list of 44 substances that have been identified as toxics. We are discussing this with the provinces and there will be quite a bit more to be announced when the green plan is tabled in the House before the end of this calendar year.


WESTERN ECONOMIC DIVERSIFICATION
Hon. Roger C. Simmons (Burin-St. George's):: Mr. Speaker, I have a question for the Minister of Western Economic Diversification.
This government has funded some hare-brained schemes in its day, but one of the most outrageous has to be the $100,000 in public money spent on an engine turbo charger which wound up on the race tracks in the United States and ultimately on the scrap heap.
I wonder whether the minister would tell us why this scandalous waste of public money was allowed by his illustrious predecessor, our very own hot rod Bill over there.


Hon. Bill McKnight (Minister of National Defence):: find it exceedingly strange, Mr. Speaker, that a member of Parliament who comes from a region such as Newfoundland would be critical of actions that are taken in

October 30, 1990
Oral Questions
western Canada to diversify and strengthen the economy.
I can inform the hon. member that in most casts, except for research and development, the western diversification initiative makes all moneys given to business refundable.


Roger Simmons: Mr. Speaker, the minister of course misses the essential point. The decision was made here in Ottawa.
While he is forthcoming, can he tell me a couple of more things? First of all, this turbo charger had to be destroyed in 1987. The government found that out two years later and, notwithstanding, paid out additional money to an Alberta firm for a non-existent project.
Will he answer that question? Will he tell us why the Government of Canada paid out public money for a turbo charger that had been wiped out, destroyed, two years before?


An hon. member:: Tory efficiency.


William Hunter (Bill) McKnight: Mr. Speaker, I can explain to the hon. member that in western economic diversification the decisions are made in western Canada. There is a deputy minister-


Roger Simmons: This one was made in your office.


William Hunter (Bill) McKnight: Mr. Speaker, the member makes an allegation that that decision was made in my office. That is a lie, that is a lie.


Some hon. members:: Hear, hear.


Mr. Speaker:: I am sure, no matter how strongly the hon. minister may feel about it, he would not want to use that language, and I would ask him to withdraw that word.


William Hunter (Bill) McKnight: Mr. Speaker, as I would always wish to follow your instructions, I only could only do so if the hon. member for Burin-St. George's would withdraw his allegation.


Some hon. members:: Oh, oh.


Some hon. members:: Hear, hear.


Mr. Speaker:: I would ask the hon. minister to consider his position, and we will return to it later.


Mr. Bob Speller (Haldimand-Norfolk):: Mr. Speaker, my question is for the Minister of Employment and Immigration.
The minister is no doubt aware of the confusion surrounding whether or not Stelco workers who were laid off after the long Stelco strike will be eligible for benefits under UIC.
Will the minister give Stelco workers her assurance in this House today that they will indeed be eligible for UIC benefits once this long strike is over?


Hon. Barbara McDougall (Minister of Employment and Immigration):: Mr. Speaker, the rules on unemployment insurance are very clear. Now that we have Bill C-21 and the new rules will come into place on November 18, my officials in Hamilton will be working with the company and with the union. All will become clear in that time.


Ms. Sheila Copps (Hamilton East):: I have a supplementary question, Mr. Speaker.
The 6,800 workers have to work this Saturday on the agreement. If the federal government is not prepared today to give a written undertaking that all workers will be eligible for unemployment insurance, there is a very good possibility that this strike will not be over. In fact, both union and management have been in touch with the government seeking just such an assurance.
I am sure that the minister, along with all her colleagues, hopes that this long strike is over and that those 6,800 people in whole or in part can come back to work, but will she guarantee the House today that some 4,800 who will not immediately be recalled will be eligible for unemployment insurance?


Barbara Jean McDougall: Mr. Speaker, it is not the practice of this government to get into the middle of disputes between labour and management. The hon. member knows that our job is to work with both sides to come to a conclusion. That is exactly what we will be doing in this case as in other cases.
October 30, 1990


CANADIAN ARMED FORCES
John R. (Jack) Whittaker: Mr. Speaker, in the last couple of weeks we have watched the Secretary of State for External Affairs rattle his sabre and push this country to the brink of war. Yet, today, the Auditor General has pointed out that the Canadian forces are not suitably designed for conditions of war.
Could the Secretary of State for External Affairs explain why he is pushing this country toward war when it is obvious that our Armed Forces are not prepared for combat?


Right Hon. Joe Clark (Secretary of State for External Affairs):: Mr. Speaker, not even the cartoonists of the country believe that.


John R. (Jack) Whittaker: I am sure, Mr. Speaker, that the cartoonists will have more fun today.
The Auditor General was asked this morning if the Canadian forces medical services could withstand a prolonged war or a dramatic increase in patient load. His reply: "We are not in a position to give appropriate medical help in wartime".
Given the statement our Armed Forces medical services are not equipped to deal with war, what extra steps are being taken to ensure the men and women serving in the Persian Gulf will receive the best possible medical attention should the need arise?


William Hunter (Bill) McKnight: I can only say, Mr. Speaker, that I am not sure, with all his attributes, the Auditor General is the best qualified to be qualified as a military strategist either.
I can inform the hon. member as to actions that we have taken to assure that Canadian men and women serving Canada in the Persian Gulf will be able to receive medical attention as required. We have put forward into the Canadian-


Some hon. members:: Order, order.


William Hunter (Bill) McKnight: There are 10 Canadian medical professionals who are serving on the U.S.S. Mercy.


Some hon. members:: Order, order.


Mr. Speaker:: The hon. member for Eglinton-Lawrence.
Oral Questions


PEARSON INTERNATIONAL AIRPORT
Mr. Joseph Volpe (Eglinton-Lawrence):: Mr. Speaker, today the Auditor General pointed to lack of government planning to deal with deregulation at airports throughout the countiy. As an example, at Pearson he pointed out that the government's refusal to act on reports dating from 1986 to repair the parking facilities at Terminal 1 has cost the government between $28 million and $38 million and further has put the safety of the structure into serious jeopardy.
In the interest of public safety and fiscal responsibility, will the Minister of Transport tell us today when he will act upon these recommendations to repair the facilities?


Douglas Grinslade Lewis: Mr. Speaker, my hon. friend would know, had he checked with the transport critic, that I announced some two weeks ago that we were prepared to renovate Terminals 1 and 2 fully, which naturally could include the renovation of the parking garage. I welcome his'assurance that his party supports the initiative.


Giuseppe (Joseph) Volpe: Mr. Speaker, the Auditor General is not at all convinced that there is a completion date for the airport master plan and for the plans that the minister speaks of. In fact he says, and I quote: "There is a lack of a policy statement and financing philosophy".
There has been a $15 million cost overrun at model q at Terminal 1 since 1987. The project is one and a half years behind schedule. There is a shortfall of $3.25 million in projected revenues at the U.S. pre-clearance facilities, and the minister is pushing ahead with privatization.
Will the minister tell this House why he is using privatization as a quick fix and a quick out for the administrative and financial mismanagement at Pearson?


Hon. Doug Lewis (Minister of TVansport):: Mr. Speaker, that is easy. Because of the previous administration's fiscal mismanagement we do not have the money. That is why we are going to private enterprise.

October 30, 1990
Oral Questions HEALTH


Ms. Albina Guarnieri (Mississauga East):: Mr. Speaker, my question is for the Minister of National Health and Welfare.
The minister told this House that dioxins are now everywhere in our environment, but he will not tell us why. The reason is that industrial air pollution rains dioxins on every inch of this country.
I ask the minister to confirm to this House that he considers food that violates his own department's regulations, creating thousands of new cancer cases, to be, as he declared yesterday, safe and nutritious.


Hon. Perrin Beatty (Minister of National Health and Welfare):: Mr. Speaker, this sort of tactic is simply reprehensible.
Members of the House of Commons, yesterday, listened to members of the opposition attempt to frighten nursing mothers into believing that they were poisoning their infants by nursing them.
What we have today is an allegation being made that thousands of Canadians are dying as a result of the intake of dioxins in their food. If the hon. member has evidence of that, let her bring it forward.
I specifically challenged the hon. member yesterday to indicate on behalf of her party whether her party's position was that all food containing any trace of dioxins in it should be pulled from the shelves and destroyed. Perhaps she could answer that.


Albina Guarnieri: Mr. Speaker, Canadians take no comfort from the minister's umbrella of words. The minister knows full well that the dioxin crisis is a 20th century problem. He also knows that there are studies which confirm that no dioxin was present in human tissue until the turn of the century.
The minister told us yesterday that he is overwhelmed by the amount of dioxin currently in the environment and does not feel it necessary to take drastic action needed to safeguard the Canadian food supply.
Given that as many as 18,000 Canadians will develop cancer as a result of the dioxins consumed in their daily diet, will he confirm to this House that this government
is not willing to enact stiff regulations and invest necessary budget dollars toward the health of Canadians?


Henry Perrin Beatty: No, Mr. Speaker, just the opposite. What I will indicate is that the Minister of the Environment and I are working very closely in terms of doing everything that we can do to eliminate the creation of dioxins. It is nonsense to suggest that dioxins did not exist prior to the turn of century. They are created by such things as forest fires. Perhaps hon. members opposite would have us pass a law banning forest fires to eliminate all dioxins from the environment.
The critical question is this: if the standard that is followed is the standard proposed by members opposite, that no food may be consumed in Canada even if it has minute traceable quantities of dioxins in it, it would result in our saying to nursing mothers that they could not breast feed their children and it would result in the destruction of hundreds of millions of dollars of food which is safe, nutritious, and available for Canadians.
I challenge the hon. member again: is this the position of the Liberal Party of Canada?


IMMIGRATION
Daniel James Macdonnell Heap: Mr. Speaker, my question is for the Minister of Employment and Immigration.
The Auditor General has confirmed what Canadians guessed long ago, that the government's refugee backlog system is not working. By March 1990 he says that one-tenth of the cases that ought to have been resolved were resolved. He believes that it is doubtful that they can meet their schedule. Now the minister's officials are holding back the most deserving cases in order to process last come Caribbean cases first.
Will the minister admit that the backlog system has failed? Will she land those people and let her immigration staff get on with regular immigration work?


Barbara Jean McDougall: Mr. Speaker, first of all I simply will not accept the allegation of the hon. member that we are moving ahead cynically with cases from the Caribbean as opposed to other kinds of cases. That is simply not a fact.
October 30,1990

Second, I would like to thank the Auditor General for some of his suggestions. As indicated in his report, we were moving on many of the areas that he made suggestions on-both in the backlog and in the new system, and in our over-all immigration plan leading to our five-year levels-because we understood as well that there were some problems in our management.
Since the end of March things have changed; 50 per cent of the cases within the backlog have now been opened because we have improved our processes, and 30 per cent of them have been decided.
The Auditor General also suggested that we should use greater deterrents. Perhaps that is what the critic for the NDP is suggesting.


Daniel James Macdonnell Heap: Mr. Speaker, the Auditor General has also confirmed that the government's new refugee determination system is falling behind, taking nine months instead of nine weeks to process people and resolve their refugee claims. And the refugee board's own figures show a new backlog in a year and a half of something like 25,000 unresolved cases.
When will the minister admit that the new system also is failing and bring in the quick and fair system that was asked for several years ago by the churches and other public groups in Canada?


Barbara Jean McDougall: Mr. Speaker, as I recall, when we brought in our new system, the part of the new system that the hon. member was most against was the safe third country provision. Is he now suggesting that in the interest of speed we bring that in?


HOUSING
Mr. Garth  Dirner@Halton-Peel: Mr. Speaker, my question is addressed to the minister of housing. In large urban centres such as Toronto and Vancouver the average family still cannot afford to purchase the average home. The problem is that first-time home buyers in Toronto need a down payment of up to $60,000.
Will the minister consider changing the rules so that people with funds in RRSPs can use that money for down payments, or will the government make it possible for first-time home buyers to set up self-directed RRSPs
Oral Questions
to be used for those down payments, thereby making home ownership more affordable.


Hon. Alan Redway (Minister of State (Housing)):: Mr. Speaker, the suggestion put forward by the hon. member is one of a number of suggestions that are going to be discussed tomorrow and the next day at the Canadian Housing Finance Conference which, as you know, Mr. Speaker, is the first ever housing financing conference held in this country. It will bring together 150 experts from Canada and internationally, from business, from the financial community, academics, to focus on what can be done to make housing more affordable, and to allow more accessibility to home ownership.
The Department of Finance had some understandable concerns with respect to the use of RRSPs for housing down payments. They obviously do not want to raise the expectations of Canadians that something of that sort will be brought in immediately, but at the same time, it is something that is under careful examination at the present time.


HIGHWAYS
Mr. Bill Casey (Cumberland -Colchester):: Mr. Speaker, my question is for the Minister of Transport. As Minister of Transport, I am sure he is aware that there is only one highway into Nova Scotia and on to Newfoundland.
Elimination of rail freight in Newfoundland has resulted in dramatic increases in truck traffic on this highway. Since being elected less than two years ago I have witnessed several accidents on this highway, resulting in fatalities to men, women, and children. Last Friday night was the most recent but sadly I know there will be more. We desperately need a new federal-provincial agreement to stop the fatalities and the grief.
Will the minister negotiate, with all the urgency required, a new co-operation agreement to have this overburdened highway replaced?


Douglas Grinslade Lewis: Mr. Speaker, I presume my hon. friend realizes and appreciates that highways are a provincial responsibility. However, I would say that my provincial colleagues and I recently approved phase four of the national highway system study at the recent Council of Transport Ministers

October 30, 1990
Oral Questions
meeting and we are looking at the priorities at the present time.
But I should also tell him that there has been no decision made on funding mechanisms at this time.


THE ENVIRONMENT
Mr. Paul Martin (LaSalle-Emard):: Mr. Speaker, the Auditor General's report on the lack of credibility of this government in terms of the environment is simply devastating.
He said: "The unsatisfactory quality of the department's evaluations raises serious questions about the extent to which Parliament can rely on them." That in a very articulate way comes perilously close to the unparliamentary language of the Minister of National Defence.
The Auditor General has said that after six years of Tory rule there is not one shred of believability left in this government's approach to the environment. Is there any reason for the Canadian people to think any differently?


Right Hon. Brian Mulroney (Prime Minister):: Mr. Speaker, my hon. friend imputes a blanket indictment to the Auditor General in respect of the government and its spending, including the Department of the Environment. He says-


An hon. member:: Another quotation.


Martin Brian Mulroney: They do not like quotations over there.
The Auditor General said in his report today: "1990 is the first year an Auditor General has given an opinion without reservations on the government's financial statements since enactment of the Auditor General Act."
But in 1975-76, the Auditor General said: "I am deeply concerned that-the government has lost or is close to losing effective control of the public purse." The President of the Treasury Board that year was Jean Chretien.


Some hon. members:: Oh, oh.


Paul Edgar Philippe Martin: Mr. Speaker, since the Prime Minister felt it important to bail out his
Minister of the Environment, perhaps he will also answer the second question that the Auditor General put very clearly.
The Auditor General said very clearly that the problem is that this government will not allow the Minister of the Environment the authority he requires or for which he can be held accountable.
Will the Prime Minister give the Minister of the Environment final authority over the green paper? If he does not, will he deem it a failure, unless the Minister of the Environment is given the authority to overrule the minister of energy as the minister of energy overruled him last week. Will he give him the authority to overrule the Minister of National Health and Welfare as the Minister of National Health and Welfare overruled him last week? Will he give him the authority to overrule the Minister of Fisheries and Oceans as the minister of fisheries has consistently befuddled the environmental-


Some hon. members:: Oh, oh.


Robert René de Cotret: Mr. Speaker, the answer to all my colleague's questions obviously is, yes.
The government has made that commitment. Later on today, we will be voting in this House on the second reading of Bill C-78. If my hon. colleague had taken the time to read it, he would see the words right in that bill.


LAPRADE FUND
Mr. Eugene Bellemare (Carleton-Gloucester):: Mr. Speaker, in his report today, the Auditor General pointed to some serious shortcomings in the procedure for funding projects through the Laprade Fund.
In many cases, projects were approved even if they did not meet the basic criteria. My question is directed to the Minister of Industry, Science and Technology. How can the minister justify spending considerable sums of money while deliberately ignoring the program's strict criteria?


Hon. Benoit Bouchard (Minister of Industry, Science and Technology):: Mr. Speaker, it is really a shame to hear a Liberal member talk about the Laprade Fund!
October 30,1990

Mr. Speaker, I think the Laprade Fund, which was created by the former government- We have some figures here which were most certainly brought to the attention of the Auditor General. Of 597 projects, 195 were approved and 175 were accepted. Thanks to money paid from the Laprade Fund, 3,662 jobs were created. I hardly think the Liberals could have matched that.


Eugène Bellemare: Mr. Speaker, my supplementary is also directed to the Minister of Industry, Science and Technology.
There is something definitely rotten in the State of Denmark. Money was given for projects that were already completed. An arena was divided in two in order to get twice the maximum grant. The Auditor General made it clear that this was a case of a minister exercising his discretion and not following his own rules. My question is this: is the minister prepared to table in the House all documents related to this fund and show who benefited from the dollars laundered by a government with very few scruples?


Benoît Bouchard: Mr. Speaker, once again, I believe that the projects submitted for funding by the Laprade Fund are absolutely genuine. The projects are submitted to senior officials of the Department of Industry, Science and Technology and evaluated very carefully. Some projects are turned down because they do not meet established criteria.
Mr. Speaker, as far as the arena is concerned, I think the purpose is as valid as it was in the case of the bingo halls they subsidized for years.


NATIONAL DEFENCE
Mr. Ian Waddell (Port Moody-Coquitlam):: Mr. Speaker, my question is for the Prime Minister.
I genuinely believe that when the Prime Minister came to this House in 1984 he was committed to civil liberties as a Canadian and as a Quebecois. He acted on that by repealing the War Measures Act, which is much more than the Trudeau government was prepared to consider.
Oral Questions
Having repealed the War Measures Act, at the Oka crisis last summer his government did not use the Emergencies Act which has all the powers through which Parliament could have scrutinized what the army did and why it was called in at Oka.
Given that the Prime Minister said on September 24, 1990, in a response in this House to the leader of my party, the member for Yukon when she called for a public inquiry into the situation:
We must all obey the same laws and, as soon as that is settled, the
government will be more than pleased to take the kind of action
suggested by my hon. friend.
We do not have a public inquiry. We have a parliamentary inquiry, but it was just announced by the Indian affairs committee that in fact it is going to be restricted.
Is the Prime Minister committed to a full parliamentary inquiry into the events of calling the army into Oka
last summer?


Martin Brian Mulroney: Mr. Speaker, the House leader of the government has been and is ready to engage in discussions with the House leaders of the respective parties in regard to precisely this point.
The army was dispatched to Oka by the Government of Canada pursuant to a request made under the National Defence Act by a provincial government. It was perfectly entitled to make that request. The Government of Canada made a value judgment and responded to that request.
I believe that the army did an excellent job at Oka. It conducted itself with moderation, restraint and a great deal of effectiveness. I know that all members of the armed forces would appreciate the support and the congratulations of the members of the NDP as they have received from other members of the House of Commons.


Ian Gardiner Waddell: Mr. Speaker, the Prime Minister must surely understand that this is an incredible situation where an army is called in by the provincial premier, the feds pay for it and we do not even have a parliamentary inquiry. What is going on? That dwarfs what the Auditor General is saying today.
For my supplementary question I ask him to consider this specifically.

October 30, 1990
Oral Questions

It is public knowledge that Quebec Minister Claude Ryan is opposed to a public inquiry on this issue. Did the Prime Minister promise Mr. Ryan he would sabotage an inquiry by this Parliament, our Parliament?


Martin Brian Mulroney: Mr. Speaker, if I am not mistaken there was a resolution before the House that need only the approval of the New Democrats. The Government House Leader has just told me that if the New Democrats had approved the resolution that is before the House, we would have been able to proceed as soon as possible.
Has the hon. member spoken to his colleagues? Had they supported the resolution, we would have been able to proceed.


Mr. Speaker:: The hon. Minister of Defence.


POINT OF ORDER
William Hunter (Bill) McKnight: Mr. Speaker, I rise to withdraw my use of unparliamentary language in response to a comment made by the member for Burin-St. George's. I apologize to the House and totally withdraw my unparliamentary remarks.


PRIVILEGE
William Hunter (Bill) McKnight: Mr. Speaker, I now would like to rise on a question of privilege for which I gave you notice.
When I was answering a question regarding a grant which he claimed was made by Western Economic Diversification and the authorizing point in that grant, the hon. member for Burin-St. George's said: "That was authorized in your office", meaning me, Mr. Speaker.
I think it is important, Mr. Speaker, that members of the House, members of the Public Service who are responsible for Western Economic Diversification, and the recipients of grants understand the process.
The pacemaker process to which the member for Burin-St. George's referred was a project which was initiated and authorized in 1985 under the IRDP. I was not the minister responsible in 1985 for the IRD program. The program was transferred to Western Economic Diversification when that department was established to encourage diversification in western Canada.
There were further payments made to the pacemaker project. Those payments were made in January of 1989.1 was not the minister responsible for Western Economic Diversification at that time. Another final payment was made in March of 1989. I was not the minister at that time.
The payments were made after an independent audit of the financial statements and an audit visit to the site by the WD officers. It was agreed upon that the company had met all terms and conditions of the 1985 agreement under IRDP.
The hon. member, in saying that it was done in my office, was either unaware of the circumstances or inadvertently was misleading the House.
I will conclude by saying that out of 37 projects in Western Economic Diversification reviewed by the Auditor General, one-this one, initiated by another department-was found lacking, 36 were found to be fully satisfactory.


Some hon. members:: Hear, hear.


Mr. Speaker:: The hon. Minister of Defence has, of course, very properly withdrawn his remarks and has continued on a question of privilege. The House has heard him. I expect all hon. members will, of course, hear the hon. member for Burin-St. George's.


Some hon. members:: Hear, hear.


Roger Simmons: Mr. Speaker, I rise in relation to the question of privilege raised by the Minister of Defence. The point he made toward the end about the number of projects that did not come under the scrutiny of the Auditor General is not at all the point. This one did.
This one was initiated before his time in terms of administering the project, but he had ministerial respon-
October 30,1990

sibility for it. He does not have it any more, and that is the crux of it. He chose to rise today, although he is no longer answerable or accountable to the House in respect to this particular department.
I say to the minister that there is no innuendo. I was very direct in what I said. I said across the floor to the minister that the decision was made in his office. Now, candidly, I cannot tell you, Sir, whether the decision was made in his office, or his rec room, or his bar. But I can tell you this, and I can tell him this, that this one has got politics written all over it and the handwriting-


Some hon. members:: Oh, oh!


Mr. Speaker:: The hon. member for Burin-St. George's may want to argue the point of privilege further. The point of privilege is very simple.
The hon. minister has risen and said that an accusation said across the floor by the hon. member for Burin-St. George's is not true, and the hon. Minister of National Defence has given the House his word that it is not so. That is the issue. In this place we usually accept an hon. minister's word or any hon. member's word, if it is stated.
I think the position that the hon. member for Burin- St. George's is in is to give me some explanation as to why this is not a question of privilege and, also, to indicate to me what his response is to the fact that the minister has risen and said that this did not take place in his office.


Roger Simmons: Mr. Speaker, I am not clear on that point, but I shall repeat it one more time. I think these are the actual words, or essentially these. I said, in all candour, I do not know whether the decision was made in the minister's office or his rec room.


Some hon. members:: Oh, oh.


Mr. Speaker:: I will consider the comments and report to the House.
The difficulty that the Chair is in, and the difficulty that the House is in, is that we have a tradition that if an error has been made and someone rises and says: "I did not do that" or "The facts are wrong", there is a gentleperson's tradition in the House that the member making the error withdraws the allegation. That is what the hon. minister is asking the hon. member for Burin-
Point of Order
St. George's to do which, it seems to me, would be an easy thing to do and would also end this difficulty.


Roger Simmons: If the minister says that the decision was not made in his House, I take him at his word, it was not made in his house.


Some hon. members:: Oh, oh.


Mr. Speaker:: Well, perhaps the hon. member for Burin-St. George's can consider his position further, and we will move on to other things.


POINT OF ORDER
Gilles Loiselle: Mr. Speaker, with the permission of the House, as we have received this morning the Auditor General's Report, and since this is Mr. Ken Dye's last report, on behalf of the government I would like to indicate that we feel he has made a very significant contribution to helping guide the government to improve our management and efficiency.
I would like to say that he has been very useful in following up on his recommendations, that we have also taken them into great consideration and we have acted upon them.
I would like to assure him that until the end of his mandate we will continue to collaborate with him.


Mr. Axworthy (Saskatoon - Clark's Crossing):: Mr. Speaker, I have a brief but important point of order and it relates to the matter of the comments by the Minister of National Defence.
The last time that-


Mr. Speaker:: I wonder if we could leave that for the moment. The hon. minister has risen with respect to the Auditor General. I think that there may be some comments from other parties.


Leonard Donald Hopkins: Mr. Speaker, I thank the hon. member for his patience. I want to follow the President of the Treasury Board in making a few comments about the Auditor General.
Today the Auditor General tabled his last report in the House after serving this Parliament for 10 years. It is a big job for a person to come in and take over because

October 30, 1990
Point of Order
government is big business. It cannot possibly be done all in one year. It has to be divided up in cycles, with parts done parts each year. Even in that time, it is a big job.
I think the Auditor General has some very fine achievements to his record, as indicated by the President of the Treasury Board, achieving that certain reservations no longer exist. For example, today Public Service pension funds that are owed by the government as part of the debt of the government and also the foreign loans that will not probably be collected are now part of the country's liabilities.
He has tackled these things in a very realistic way and in a very serious way. As Chairman of the Public Accounts Committee I can say that the Auditor General and his staff have been most co-operative. Whenever he appeared before our committee as a witness, he never backed down from statements that he had made because his work was well researched with fine conclusions emanating therefrom.
In the years ahead, it is going to be very important that we have a good successor to the present Auditor General who has laid so much very important ground work. The taxpayers of this country and probably any free country of the world are going to demand greater accountability of their parliaments and their legislatures and, indeed, they are going to ask for greater accountability from their individual members of Parliament and representatives. I think that is one thing that we all have to accept as part of democracy.
The Auditor General has been very adamant in his protection of the public purse. It is very important that this Parliament support the Auditor General, his office, and his staff. It is very important that the public accounts committee co-operate and work very closely with him. Of course, it is very important that he has the support of the people of Canada because he is the one that is going to protect their purse.
Many countries send their auditors general to Canada to learn our system. That simply indicates the good programs put together with approximately 690 personnel in the Auditor General's office and a system whereby other people who are experts a in the field, perhaps
atomic energy or defence matters, can be brought in on short-term contracts, and then let go.
He has put together a very good program. He has been an outstanding servant to the country. I hope that those who are searching for a new Auditor General for the next 10 years will indeed find the qualities in the new man that have existed in Kenneth Dye.


Some hon. members:: Hear, hear.


John R. (Jack) Whittaker: Mr. Speaker, I would like to join with the other two members who have spoken of the Auditor General and the work that he has done, on behalf of my party, the New Democratic Party.
Although I am a rookie to the House of Commons and fairly new to the public accounts committee, I have learned in a very short time that the Auditor General is a friend of all parliamentarians. The Office of the Auditor General has shown that it is willing to work for and with each member of Parliament if the member shows an interest in finding out anything within that department.
I would like to say also that the people of Canada are very proud of the job that the Auditor General has done. Being a native British Columbian, like yourself Mr. Speaker, we in British Columbia are particularly proud that the Auditor General for the last 10 years is from British Columbia.
The Auditor General in wrapping up his summation in his tenth and last report says at page 40: "I shall leave my post at the end of next March believing that the office of the Auditor General has made a positive contribution to Parliament and that I have done my best. I hope many will agree."
Mr. Speaker, we in this party unanimously agree that in fact he has done his best and he has done an excellent job for the people of Canada. Thank you, Auditor General.


Mr. Speaker:: It being 3 p.m. the House will now proceed to the taking of the deferred division on the motion at the second reading stage of Bill C-78, an act to establish a federal environmental assessment process.
October 30, 1990

Government Orders



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Thursday, October 25, consideration of the motion of Mr. de Cotret that Bill C-78, an act to establish a federal environmental assessment process, be read the second time and referred to a legislative committee.
Reimer
Richardson
Roy-Arcelin
Schneider
Scott (Hamilton-Wentworth) Siddon
Ricard
Robitaille
Saint-Julien
Scott (Victoria-Haliburton)
Shields
Sobeski
Soetens
Stevenson
Thompson
Tremblay (Quebec-Est)
Valcourt
Vankoughnet
Vien
Weiner
White
Wilson (Swift Current-Maple Wilson (Etobicoke Centre) Worthy-130
Sparrow
Thacker
Thorkelson
Turner (Halton-Peel)
Van de Walle
Venne
Vincent
Wenman
Wilbee
;-Assiniboia)
Winegard
++NAYS
Mr. Speaker:: Call in the members.
Members


The Acting Speaker (Mr. DeBlois):: I declare the motion carried.
Therefore Bill C-78 is referred to a special committee appointed to pre-study the bill and to act as legislative committee thereon, pursuant to order made Wednesday, June 27, 1990.

October 30,1990
Government Orders


[Stage Direction]
Motion agreed to, bill read the second time and referred to special committee.
Mr. Jean-Robert Gauthier (Ottawa-Vanier):: On a point of order, Mr. Speaker.


The Acting Speaker (Mr. DeBlois):: The Opposition House Leader on a point of order.


Jean-Robert Gauthier: Mr. Speaker, I hesitate to do this because members know the rules, but Citation 223 of Beauchesne's fifth edition is quite clear, as follows:
223. (1) A Member must be within the House and hear the question put in its entirety, in one of the official languages, or his vote cannot be recorded. It is not sufficient for him to hear it while he is in a gallery or behind the curtains.
Mr. Speaker, I humbly submit that the hon. member for Lac-Saint-Jean did not hear the question put in the House and that he is not entitled to have his vote recorded as being in favour of this bill.


Hon. Lucien Bouchard (Lac-Saint-Jean):: Mr. Speaker, it is true that I was unable to be in the House at the appropriate time. I was detained behind the curtains and I rushed in to take part in the division.
Mr. Speaker, be that as it may and whatever your decision might be, I support this bill. I am very proud of it because it will put Canada right up front when it comes to the environment.


Some hon. members:: Hear, hear.


The Acting Speaker (Mr. DeBlois):: I will draw the attention of Mr. Speaker to the facts and he may decide to make further comments.


TRUST AND LOAN COMPANIES ACT
[Stage Direction]
The House resumed consideration of the motion of Mr. Loiselle that Bill C-83, An act to revise and amend the law governing federal trust and loan companies and to provide for related and consequential matters be read the second time and referred to a legislative committee.
Mr. Dave Worthy (Parliamentary Secretary to Minister of State (Privatization and Regulatory Affairs) and Minister of State (Finance)):: Mr. Speaker, it is my pleasure to rise and speak to the trust and loans bill. My
first comment has to be that the trust and loans bill does not stand alone. It fits into the total reform package of bills and will encompass all of our financial institutions in Canada.
I will be trying to explain briefly some of the history we have gone through in arriving at this bill and how the bill has taken into consideration the various needs of the institutions, the consumers and the people in Canada.
The historical framework within which Bill C-83 is being brought forward is a process of reform of the financial sector, and is not a quick one. The process in fact has been said by many people to have taken too long. However, I think hon. members will agree that it is wise to deliberate longer and to make sure that what we do come up with is workable.
In this bill the minister and his staff have been pragmatic and practical and propose what in large part has taken years of consultation and consideration to arrive at.
At the beginning of its mandate, the government recognized the need for reform. Therefore, in April 1985, it brought forward the green paper. This green paper resulted in many discussions across Canada. Committee reports were made on it, and as a result of these discussions, as well as input from the industry and the public, the proposals underwent refinement. This led to the tabling in December 1986 of the paper entitled New Directions for the Financial Sector. Once again, there were further discussions, draft legislation was compiled at this point and the trust and loans companies draft legislation was tabled for discussion purposes in December 1987. Of course, further consultation took place subsequent to that.
Throughout this period, as well, several other pieces of legislation did come into effect to make temporary improvements to the system. These were Bills C-42 and C-56. These bills implemented a number of changes in the regime governing the financial institutions, particularly with respect to the supervisory functions now exercised by the Superintendent of Financial Institutions. These, in effect, created a stronger position for the Superintendent, and this has been recognized by all parties and throughout the industry as being a very positive move.
October 30, 1990

The government has been active in pursuing the reform of the financial sector. We have also been careful to ensure that our proposals will be effective as well as practical. We know that there is no point in producing reforms that look good but in the final analysis will not work.
I believe that the measures recommended in Bill C-83 will be found to be effective as well as practical. Because they will be practical, they may fall short of some of the aspirations of many of the parties. Because they are broadly acceptable to all sectors of the industry, there will no doubt be some people who wish that one provision or another were a little different. This is the case, however, where it would be impossible to grant everyone's wishes fully. There are too many legitimately different points of view. The government has settled on proposals which meet the needs of the economy and the institution, as well as the Canadian public.
It is important to remember that with the size and importance of this sector, there are four sets of needs which this legislation must recognize and fulfil.
First, there are the needs of the economy. The financial system is not just an important segment of the economy in terms of its size, it is a vital support system without which the economy as a whole would grind to a halt. The easiest and fastest way to harm the economy is to have a financial system that does not meet the current needs of companies and individuals. Conversely, a healthy and dynamic financial system will strengthen the whole economy. Anyone who has bought a car, has tried to get a mortgage on a house, has tried to finance their business, knows that the financial institutions in this country play a critical role in our economy.
There are also the needs of the institutions themselves. The trust and loans legislation was enacted in the first 20 years of this century. If my memory serves me correctly, it was 1917. It is in excess of 70 years since this legislation was first enacted and obviously there have been many changes in the environment in which they operate, many changes to their needs and, of course, this legislation must take that into account.
Then, of course, there are the needs of the consumers and the public. They need information and assurance that the health of the institution with which they are
Government Orders
dealing are honourable and that they can have confidence in dealing with them.
They also require the improved services that the financial institutions in Canada want to provide for them and, of course, it is up to us to make sure that this legislation does provide this increased responsiveness to the Canadian public.
In addition, there is another important demand placed on these proposals and that is the need to harmonize with the provincial governments. If a person is going to create a viable financial business in British Columbia or in Quebec, or one that is going to function across the country, it is obvious that the regulations controlling these institutions have to be co-ordinated.
It is recognized by the Department of Finance and our minister in producing this bill that harmonization with the province and their regulations must take place. The co-operation between the two levels of government is the most responsible way of ensuring that the health of all Canadian financial institutions is maintained. I am pleased to say that the proposals for reform are substantially met in the bill that we are tabling.
I would like to get into a few of the points of the bill itself, how it addresses the needs of these various people in the tax reform. I want to reiterate first, though, the important point that the principles of this bill are not isolated. They are part of the larger reform process and must be discussed in the context of that larger reform. All four pillars of our financial institutions are being addressed and the bill today, of course, just addresses the trust and loans, but it must work in harmony with the other bills to follow.
The bill will achieve four things. Initially, it will revitalize the rules of ownership. They will allow for both closely-held and widely-held institutions. It is required that it revitalize the framework for competition in the financial sector. This will be done by removing many of the restrictions imposed now on financial institutions so that they can compete fully with each other.
There has to be, of course, updates to the prudential safeguards. These will be providing protection for the depositors as well as the policy holders. In the process of this, we will be, as a by-product, modernizing the existing statutes.

October 30, 1990
Government Orders
Let us look first and quickly at the framework for competition. The general policy of the government with respect to competition is that consumers and institutions should be able to have the opportunity to offer similar ranges of service and competing markets previously not open to them. This is intended to enhance the choices available to our consumers.
We propose that with appropriate approval and subject to some relatively minor restrictions, financial institutions will be able to diversify into new financial businesses through their subsidiaries. This follows on the provisions of legislation passed in 1987 which permitted federally chartered financial institutions to own security dealers.
Under the new provisions, trust companies may be owned by institutions without trust powers, such as banks and insurance companies, and trust companies may themselves now own insurance companies. Similar provisions will apply to other types of financial institutions not covered by this bill before us today.
In considering whether to approve the purchase of a financial institution by another in a similar business, the minister will, of course, take into account the size of the buyer and the size of the institution being acquired.
Trust and loan companies will also receive full consumer lending powers. Full commercial lending powers will also be available to them, as long as they satisfy the conditions which will ensure that they have the necessary staff and controls in place to manage the commercial portfolio. Banks, of course, as an ancillary to this, will be able to offer portfolio management and investment advice services, inhouse.
Trust and loan companies will also be allowed to network financial services offered by affiliates or independent financial institutions, subject to the restrictions on retailing of insurance.
I would like to get into that, just briefly, because there are some things that deposit takers are not going to be permitted to do and it is important that we, as legislators, and that all Canadians should be aware of them. First, with a few limited exceptions, banks and trust and loan companies will not be allowed to retail insurance or to distribute insurance applications through their branches. The exceptions are credit-related life insurance and
travel insurance, which they have provided for many years.
Second, while a deposit-taking institution may own an insurance company, the operations of the two businesses have to be kept separate. It is important to recognize that this approach carefully balances several policy objectives. It promotes a degree of extra competition that we believe will be healthy and beneficial for consumers but without disrupting the long-established business of insurance retailers. Licensed brokers and agents will continue to be able to give their clients professional advice on which insurance companies and policies will best serve their needs.
Also, no financial institution will be able to engage in car leasing and this is something for which there has been a lot of demand for by financial institutions and about which a great deal of concern in the general marketplace.
In theory, the idea of financial institutions being in the car leasing business is very attractive but it flounders at one critical point. Banks are already extensively engaged in the business of financing car dealers and they also are in the business of providing consumer auto loans. If, on top of this, banks were to go into the car-leasing business, there would inevitably be questions of conflict of interest. Of course, it is for this reason that the government has decided not to allow car leasing within financial institutions.
There are going to be significant changes in the ability and control of ownership within financial institutions. The government has adopted a pragmatic approach to the question of ownership. There is an area where many options have been expressed, many mutually exclusive. But I believe the proposals in the policy contained in Bill C-83 will meet the needs of all those involved.
The first step in our ownership is to ensure that the Minister of Finance has the authority to approve significant changes in ownership of federal financial institutions, as well as the existing authority to approve all start-ups. This is an increased responsibility for the minister and, of course, the opportunity for increased flexibility within the system. Specifically, an investor will be required to obtain the minister's approval of any purchase of shares which will result in ownership of more than 10 per cent of any class of shares held in that company. Investors now owning more than 10 per cent of the shares of an institution will be required to gain
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approval from the minister for the purchase of additional shares.
Finally, an investor must gain approval to acquire control of a company that is linked to a financial institution, when the result is a change in the significant ownership interest of that institution.
Trust and loan companies will continue to be able to be closely held and, in fact, they will be able to be sold on closely held basis. But if a trust and loan company is of any significant size, in fact, if it has assets in excess of $750 million or more, it will be required to take the necessary steps to ensure that at least 35 per cent of the total voting rights attached to the shares are widely held and listed for public trading on a Canadian stock exchange. Institutions will have five years to comply with this provision, which is very fair. A Canadian financial holding company or a Canadian-regulated financial institution could be able to meet the rule on behalf of its trust, loan, or insurance company subsidiary.
I would like to mention now the credential safeguards. These are the safeguards put in place in the legislation for the depositors and policyholders. A major focus of concern in the financial sector, as in business generally, is what is known as self-dealing. This is of a great deal of concern to the government, and I believe it is of great concern to all members in the House.
Our proposals embodied in this bill are based on three elements: a general ban on non-arm's length transactions, internal controls and screening of permitted transactions, and a preclearance of certain special transactions by the Superintendent of Financial Institutions. Institutions will be required to set up committees of the board, one the conduct review committee, to clear these transactions that are permitted. These conduct review committees will have a majority of their members independent of the institution.
Certain improvements will be made to the existing supervisory system. Specifically, the superintendent will gain the power to demand information from owners of federal financial institutions. As well, any director who resigns as a result of disagreement with other directors or officers of the company, or any auditor resigning or being placed at the company's request will be required to
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submit a written statement to the superintendent. Affiliated directors will now have to make up one-third of the boards of directors and, to enhance the possibility of minority shareholders being represented on the board, a system of cumulative voting will be introduced for institutions where any shareholder owns more than 10 per cent of any class of voting shares.
Finally, our policy requires federally regulated financial institutions to put into place procedures to resolve conflict of interest.
I believe this legislation is appropriate. It is the fruit of many, many years of consultation and its provisions express principles that will operate to the benefit of the financial sector, the economy, and in fact all Canadians. I am proud to be able to speak in support of this bill and I urge its consideration to the House.


POINT OF ORDER
The Acting Speaker (Mr. DeBlois):: Before we go into the question and comment period, having considered the point of order raised earlier this afternoon by the opposition House leader and the fact the hon. member for Lac-Saint-Jean admitted he was absent when the motion on Bill C-78 was put, it is my duty to have the name of the hon. member for Lac-Saint-Jean withdrawn from the list of those who voted for the bill.


TRUST AND LOAN COMPANIES ACT
The Acting Speaker (Mr. DeBlois):: 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 Markham- Whitchurch-Stouffville-Gun control; the hon. member for Dartmouth-Goods and Services Thx; the hon. member for Trinity-Spadina-Immigration.

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On questions or comments, the hon. member for Scarborough-Agincourt.


Mr. Jim Karygiannis (Scarborough-Agincourt):: Mr. Speaker, I listened to the hon. member with great interest. I had an opportunity in the past year to meet with a member of the board of the Bank of Nova Scotia, Mr. Gordon Bell, who is also the chairman of the bank. Mr. Bell and I had a lengthy discussion and he tried to convey to me why the bank should be allowed to sell insurance over the counter.
The question that I have to pose to the member is: Does he feel that in any way, shape or form the insurance industry will be hurt? If so, in what way, if the banks are allowed to compete? Does the hon. member not see that, if this is allowed to the banks, it would give the general public a much easier means of obtaining insurance? Also, in the sense of trade, does he not see that it will lower the insurance rates along with the charges of insurance on individuals?


Mr. Steven W. Langdon (Essex-Windsor):: I would like to thank the member from Scarborough for his question.
There has been a great deal of interest, not only by banks, which the hon. member mentioned, but also from trust institutions. Any institute that has depositors and branches has encouraged us to consider giving them the ability to be able to sell retail insurance from their branches.
As has been stated very strongly by the insurance companies, their representatives, and people concerned with the issue, the insurance companies now do a very good job of selling insurance. There is a lot of competition already. The feeling was that the professionalism shown by the industry and the ability to deal properly with it was more properly done through insurance companies.
Of course, banks will be able to have insurance companies as affiliates and will be able to get into the insurance business if that is really their intention. But it is not felt to be in the over-all interests of the public, the consumers, or the financial institution to allow the retailing of insurance at the branches.
Mr. Speaker, if I could pursue that question a little further, one of the things which strikes us about this
legislation and, in fact, the broad pattern of deregulating step by step financial institutions which is taking place, is that we are going to see a situation created in which it will be possible for banks or other financial institutions to move into other fields through the takeover of existing institutions or the establishment of new institutions.
For instance, a bank will be able to establish an insurance company. It will be able to use that insurance company to promote the sale of insurance products and services through the credit card operations at the bank. There is a great deal of new scope for banks to broaden their activities. Similarly, there is a great deal of new scope for insurance companies and trust companies to broaden their activities.
Yet, there is a line which is drawn when it comes to an insurance company which a bank might set up being able to promote through credit card mailing lists and that kind of thing. It is nevertheless prevented from seeing those insurance services directly offered to the consumers of the bank on a branch-by-branch basis.
In short, it seems that one has not established a level of increased direct service or increased direct competition at the branch level of banks, for instance, that would operate as a threat to existing insurance companies. It seems to me as I look at this that there is a major question that one can raise as to whether the government is not trying to let these major financial institutions have their cake and eat it too. They would have the possibility of expanding their operations into new financial fields, yet securing from competition and securing from the possibility of better service to consumers those institutions that might be threatened by that expansion.


Dave Worthy: Mr. Speaker, I was listening carefully to the member for Essex-Windsor. I think he has put his finger right on the critical area, as I indicated in the first few statements of my speech.
There is a veiy critical balance that was required between the liberalizing or streamlining of the financial industry and yet retaining some of the controls that we feel are in the best interests of the people of Canada.
It is in this particular area where the government tried, while encouraging the competitiveness between these financial institutes, which my hon. friend indicated is there, but retaining as a policy for the existing insurance retailers, the dealers and the professional bodies that are there to service the insurance needs of the Canadian
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people, that that is still going to be retained and controlled as a separate entity.
The member will find that there will be people, and in our committee meetings I am sure we will hear from people, who will talk to both sides of that issue and who will be able to explore exactly why that balanced point in fact was taken.


Giuseppe (Joseph) Volpe: Mr. Speaker, I would like to ask the hon. member if he would take a moment to explain to me what will happen to those depositors and consumers as a result of the initiation of this legislation.
These are consumers who were accustomed, prior to this legislation, to two things: First, the kinds of regulations that imposed very strict guidelines on each of the pillars of the institutions which he has mentioned. Such regulation was made easy by the fact that each one of them was guided by a separate body of laws and regulations. Applying the regulations to one meant that regulations were being applied to the entire industry.
Second, what would happen to the depositors who had some security, but now, faced with new legislation, the depositors and trust and loan companies will find that the regulation and therefore the security is well blurred.


The Acting Speaker (Mr. DeBlois):: In one minute, please, the hon. member for Cariboo-Chilcotin.


Dave Worthy: Mr. Speaker, you want a 10 minute answer in one minute.


Jim Karygiannis: You have already taken 30 seconds.


Dave Worthy: Mr. Speaker, I have already taken 30 seconds, the hon. member says.
I should point out first that the depositors are going to feel more secure with this legislation. The improvements to the increased powers to the superintendent should make him feel more secure. The demand that the internal control by companies to protect those same depositors should make them feel more secure as well.
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The guidelines existed in previous aeons it seems like. It must be remembered that these are 70 years old and long overdue for a realignment. I believe that bringing them together so that all four pillars are in fact being guided by the same principles will be a dramatic breakthrough. It will be better for the banks. It will be better for the insurance companies. It will be better for the trust and loan companies and, most important, it will be better for Canadians.


Mr. David Walker (Winnipeg North Centre):: Mr. Speaker, I approach this piece of legislation with a great deal of trepidation because I think that the country has been waiting a long time for changes in the banking and financial institutions of this country. At this point in time we are not quite sure, after all this deliberation, whether or not this is the most appropriate piece of legislation.
The industry: banks, life insurance companies, trust companies, and loan companies, have been waiting for close to seven years for this legislation to be produced. There are all sorts of rumours on the Hill that this House is not going to continue, but is going to be prorogued soon. I hope that this is just not another false start for people in the industry. It is a great cost to the people dealing in the financial markets to have such insecurity attached to a piece of legislation and to see it introduced to the House at a time in which there is a great deal of doubt as to whether or not we will continue. It is unfair to those people who depend upon security and continuity in their operations.
The insecurity that has been there for the last seven years is reflected in a comment in a letter written to me by a life insurance company which is concerned about its own security. They were answering the question: Has the wait cost them anything? They responded:
The truth of the matter is that the banks have had a field day compared to insurance companies. We have been waiting over 50 years for modernization of our legislation, while the banks have enjoyed regular decennial reviews which have expanded their powers each time. No stroke of the pen will make the field level. We have a lot of catching up required before any semblance of parity exists. Our industry is in some danger from both lack of modernization and from the banks getting even greater powers, including the ownership of insurance companies.

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This concern still stands as we face this piece of legislation. For the past seven years everyone has been waiting for the government to present its great step forward. We have had several rumoured attempts in the past by this government. Either they lost the way or lost their courage in dealing with this critical issue.
Our financial institutions control billions of dollars in assets. Whether it is their savings in a bank account, or their financial security expressed through their insurance policies, the vast majority of Canadians use our financial institutions on a day-to-day basis. They demand that we have a system they can depend on.
Yet, Mr. Speaker, at this time, we find that our institutions are facing a great deal of external pressures to change. I think it is incumbent upon members of Parliament, when we are dealing with the modernization issue, to deal with it honestly and directly because those changes are taking place, whether we like it or not.
For example, I would like to list three or four factors which are really influencing the progress, or the lack of progress, in our financial institutions. First of all, the globalization of financial markets. In recent years financial institutions have undergone a massive transformation. This transformation has included the development of new financial instruments and practices for managing risks, broadening markets and improving access to funds. The increased use of technology has facilitated this transformation and has been stimulated by it.
The underlying factor shaping the transformation of financial institutions has been the globalization of markets. There are processes now in place that can handle up to 900,000 transfers in the banking system on a daily basis.
The globalization of financial markets has been driven by both the needs of borrowers and investors. For borrowers, corporations and governments alike, the request for the cheapest source of funds and a broadening of their borrowing base has been paramount.
For savers and portfolio managers, the incentive has been better investment opportunities and greater diversification of portfolios. These considerations have also driven financial institutions to take a more global view of their operations.
Canada has been very slow to adopt its financial institutions for this new international reality. Consequently, many are playing a smaller role than might have been expected and in what would appear to be their natural niche in international markets. Globally, many of our institutions are losing out to competition.
A second change taking place that affects all of our financial institutions is the implementation of the Cana-da-U.S. Free Trade Agreement. Under this agreement, American banks have gained entry into Canada and had the limits removed on the growth of their assets. Their Canadian subsidiaries are no longer required to obtain approval of Canadian authorities before opening branches in Canada, so they enjoy the same opportunities as Canadian banks.
Another significant provision under the Canada-U.S. Free Trade Agreement is that which exempts U.S. Schedule II banks from the asset ceilings on the size of the foreign bank sector, thus improving the ease with which they can establish branches. Many of the banks feel aggrieved by this, as do the trust companies.
Perhaps even more important to the Canadian financial institutions is the second change taking place, and that is Europe in 1992. The evolution of the European Economic Community toward a full market integration will have tremendous impacts on the Canadian financial institutions. By the end of 1992, the 12 member countries of the community will become a single market for 320 million people within which individuals, goods, services and capital will be able to move freely as they do within their own respective nations today.
The service sector is a major part of the EC 1992 program. In this field, the banking directive is the keystone of the EC program. This will make it very, very difficult to have banks such as the ones in Canada get access to the European market. In the insurance sector, for example, the EC has made, and will make, a series of proposals to achieve a single European insurance market. The aim, as for banks, is to allow insurance companies to provide their service in the community on the basis of a single authorization.
In order to gain access to provide services in the European market, Canada will be under substantial pressure to grant to the Europeans the same privileges granted to the Americans under the free trade agreement, especially the exemption from the asset ceilings for European Schedule II banks.
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A third factor affecting federal legislation is the recent provincial initiatives where the financial environment has been altered significantly since 1986 relating to the legislative programs of the various provincial governments. Several provinces, including Ontario, Quebec, British Columbia and New Brunswick, have updated their legislation as it pertains to trust and loan companies. This has generally meant that provinces are in the lead in providing new directions for financial sector evolution. The most far-reaching provincial initiative is the Quebec blueprint for financial sector reform introduced in 1987.
The above factors underline the need for reforming financial institutions in Canada. There is no question about that. The question becomes one of what sort of principles should be involved and how should we approach this? I think that the principles that are very important for us to remember in the House are the principles of competition and independence. Are we increasing competition in the marketplace, are we maintaining the independence of the institutions? In many cases, as we move into a globalization process, we could become afraid that our national institutions do not have the size to compete, we may set aside the questions of independence and competition within the Canadian marketplace for these other values.
I can assure the House that we on this side are very, very concerned that that balance be struck. That is why we look forward to seeing this piece of legislation referred to the committee and discussed in detail because we want to make sure that all parties have an opportunity to be heard.
In dealing with the question of competition many people, as individual consumers, are afraid that as these institutions grow so large that their interactions with the banks, life insurance and trust and loan companies, become so impersonal that they are not able to control that interaction, that there is information out there that makes them afraid about how they are being treated. Many of us live in a world of information and we take for granted how our information is gathered and how it is exchanged. But for many people, it comes as a great surprise to find out that they thought they were doing
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one thing at a bank or a trust company, and find out that somebody knew something else about him as a result.
I have here a letter written by a retired executive in Winnipeg who came across the most unusual example of how banks use information. I will read part of that letter because I think it is very illustrative of the concerns of Canadians as they face these changes. It states:
My bank recently contacted me by telephone noting a large cheque had passed my account in the name of an insurance company and inquiring if the bank was satisfying all of my requirements for financial services.
Subsequently, I complained to a bank vice-president citing what I felt was a misuse of confidential information and unethical practice in using a record of banking transactions, unavailable to other financial institutions, to market the bank's own financial service. I was informed that a breach of confidence would only occur if the information was shared outside of the bank and the ethical question was a fine line in a very competitive world.
Nothing is more unnerving to a businessman whose business might be vulnerable in a time of recession, or to a family that might be paying a large mortgage, to feel that a banking institution knows its every move and has every piece of information. Part of the squeeze play that can be put on a consumer is the squeeze play of using that information to the disadvantage of the consumer whether he or she be a business person or a person running a family.
The House has to be conscious of our responsibility to ensure that as we move toward the modernization of the process, which we support in every way, we do not forsake or move away from the principle of competition among these institutions. For example, we welcome the decision of the government not to allow the banks to sell insurance because we think that it sets up a retail network that would be very hard for independent people to survive. The insurance industry itself is very concerned about this. I am sure it will welcome the legislation in that context.
However, the other part of the legislation contradicts that intention when the government says that it will allow the banking industry to become involved as owners of an insurance company. If we accept that part of the principle of modernization and every other field has been integration, the very fact that we are setting up a process which allows at an ownership level an integration

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of function, one would have to be pretty naive to assume that at the retail there would not be some products which reflect the integration.
The government has appeared to close the door on this issue, but I am wondering if it slammed it shut. Will we not see continuous pressure from the different associations which have something at stake here? We all know they are very active. Will they not come back to the government after this piece of legislation is passed and say: "We are all in this together. We have companies that do both businesses. We do not understand the rationale of why we cannot be involved in the leasing industry or in insurance selling"? Will it not just be a matter of time before we find another proposal on the table going back to the question of selling insurance?
Before this government came to power there was a different attitude to what changes would be necessary to ensure the solidity and security of our financial system. We wanted strong conflict of interest provisions and self-dealing rules. We wanted to guarantee the solvency of the players. The expansion of corporate powers into different areas of financial services was a secondary consideration, but the attitude has changed. Instead of protection for the consumer in the industry, the focus of this new legislation is exactly the opposite. It is expansion of concentration.
We have already seen what deregulation has done in other industries of national importance. For our airlines, deregulation has meant a reduction in the number of airlines and airline jobs, reductions in service for small centres, and over-all financial difficulties for the remaining carriers. The same could happen in the financial sector.
With the recent change-over to the fall schedule, I am sure all politicians from different regions in the House would join me in recognizing the fact that cities outside the Ontario-Quebec golden triangle are suffering greatly from the cutbacks in the airline industry. The reality that Canadians have to face is that the quality of the service being provided to many communities is nowhere what it was a few years ago.
Yet the basis of the argument for change is similar to the arguments that we face right here in the financial legislation: the arguments of globalization, free trade,
and changes in the national economy. Those arguments we deal with here are the same technical arguments that we dealt with under airlines deregulation. We walked away from the principles of independence and the principles of competition in airline deregulation, and we have been badly hurt by it.
Will we even have two airlines in the 1990s? Can we imagine somebody raising that question in the House a decade ago, saying that we would only have one airline in Canada? That member would not have been respected or listened to for one minute. However, right now this government, because of its commitment to free markets, cannot protect two airlines. We will be left with only one. The government does not have any appreciation of what it means in the regions and of the lack of services.
Similarly, if the government does not apply the same principles in this legislation, companies trying to survive in regional markets, companies which have developed a segment or a focus in the marketplace will not be able to withstand the pressures from the big actors to take them over. They will not be able to recapitalize. They will not be able to take on the international markets because the rules within Canada will not be able to sustain their activities.
There are several companies which need the protection of the national government. That is why we have a national government, although it is not believed on the other side of the House. We have a national government to protect the public interest in Canada. While we respond to these international conditions and set up companies so they can compete internationally, we have to remember that our purpose is to make sure the consumer of Canada is dealing with companies which are both independent and able to survive, whether they are located in Vancouver, Winnipeg, or Halifax and that unlike the chartered banks they will have a regional focus in their activities.
There are many other issues to be raised but, if we take a look at some of these factors, we have reason to think that as we go through the consideration of this legislation, as we review the powers of the financial institutions, as we deal with the issues of closely held versus widely held ownership, commercial and financial linkages, foreign ownership and the regulations dealing with financial institutions such as self-dealing and sol-
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vency, we will find that it is a step in the right direction to have a piece of legislation in front of the House finally.
I must encourage the government to spend a considerable amount of time in front of the committee, to encourage witnesses to appear and to take these deliberations seriously. The purpose of the government is not to accommodate the financial institutions but to establish public interest. What is lacking in this proposed legislation is the clear establishment of public interest in favour of independents and competition.


Mr. Rene Soetens (Ontario):: Mr. Speaker, I have a concern about the comments the member for Winnipeg North Centre expressed. First, on Air Canada and Canadian Airlines, I am not sure they would appreciate the obituary the member opposite just gave to one of them, suggesting that one of them was going to be gone soon. I for one would have to disagree with that, but I will leave that up to the airlines to decide particularly.
The hon. member carried on about withstanding pressures and about how one institution may have to compete with another institution, whether it be banks, trust companies, or insurance companies. He then commented on the purpose we should have in the legislation of protecting the interests of independents and of smaller concerns.
I would like to know the view of the Liberal Party. Very clearly in this proposed legislation there is protection for independent insurance brokers, of which we all have members in our ridings, in the municipalities we represent. We also have a tremendous number of car dealers throughout Canada. Each of us has one in our own riding. These brokers or car dealers contribute an awful lot to the community. Our proposed legislation has put in place protection to make sure that these independents carry on doing business and contributing to the communities in which they operate.


An hon. member:: And the leasing dealers.


René John Soetens: The car leasing dealers, absolutely.
I would like to ask the member opposite: Does the Liberal Party support the protection of these small, independent brokers and car leasing companies throughout Canada, or does it believe we should remove that from the bill and let the banks rule?
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David Walker: Well, of course not. I take my direction from the minister from my home province.
To go back to the question of Air Canada and Canadians, the reality is that it may be too soon to have an obituary; but it is not too soon to express concern about competition in that industry. To have two airlines essentially setting the pace and it almost being impossible for competitors to enter the market give us every reason to stand in this House and not wait until it is too late. I know the government would prefer to wait until it is too late, because then it can stand in the House and say that it has already happened and there is nothing it can do about it.
Of course we stand for the increased competition among independent insurance agents. Many families have built up multi-generational businesses through acting as independent insurance agents. They must be protected and therefore they must have products that they can put on the marketplace.
I do not know about you, Mr. Speaker, but the last time I looked the banks in Canada did not sell their products through independent agents. They sold their products through branches that they controlled. If we allow this system to continue, those branches will pick up every service they can. The principle behind this legislation, when it is finally passed, has to be to protect independent businessmen in every region of this country so that they can continue to survive.


Giuseppe (Joseph) Volpe: Mr. Speaker, one wonders whether the hon. member for Ontario is representing the interests of Ontario in a national government which becomes more and more fractionalized, as we see through this legislation.
I wonder if I could draw the attention of my hon. colleague for Winnipeg North Centre who gave us a very thoughtful approach to the implications of this legislation, not only to competitiveness on a world scale but competitiveness in the four pillars of the financial sector, as he outlined. He also outlined what that competitiveness would do not only for the independents that operate in that business but, most important, the theme upon which he touched.
I noticed that the parliamentary secretary opposite a few moments ago suggested that the level of service, the quality of service and the security of service provided to depositors in trust and loan companies and banks should

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be the main focus of attention in this legislation. It should also be the type of regulations that will allow for the maximizing of opportunities that depositors and consumers would like to see from the four pillars of the financial sector.


David Walker: Mr. Speaker, these issues are very important throughout the country, particularly in Manitoba. One of the last remaining independent insurance companies was Great West Life, which operated out of Winnipeg very successfully. Also the last remaining independent brokerage house in the country, Richardson and Greenshields, had its beginnings and its focus in Winnipeg.


An hon. member:: And Wawanesa.


David Walker: Yes, Wawanesa is another company. Winnipeg has a long tradition of building up financial institutions. Of course I know members from other parties who come from Manitoba would join with me in making sure that those companies remain strong and healthy through new legislation.
It is interesting how the changes sometimes go unnoticed, but I am sure the hon. member who just asked the question would be interested to know that in the last decade service charges in the banking system in Canada were introduced very quietly, obviously with the acceptance of the government. Canadian consumers now pay annually $3.1 billion, an average of $120 per person in banking charges. Those fees never existed before.


An hon. member:: Isn't that disgusting? It is hard to believe it.


David Walker: One of the greatest areas of expansion in banking profits in this country is from those services. We can see that if we allow that sort of development to continue without some questioning or without some movement on the part of the government to challenge them as to the need for this money, we will find ourselves to be victims again.
Consumers do not like their governments to be victims and to be feeling sorry for themselves. They like their governments to be strong, to show some purpose and to show some direction in protecting the consumer. Of course, as we see in the recent oil prices, the ability of the government to protect consumers is somewhat limited; but I am sure that the minister knows his responsibility and will be ever vigilant in protecting the Canadian consumer. That adventure is his commitment.
There are many other points I could raise, but I am sure the House wishes to continue so I will leave it at that.


Mr. Bill Attewell (Markham-Whitchurch-StoufF-ville):: Mr. Speaker, I am pleased to have this opportunity to participate in the debate on Bill C-83.
First of all, I would like to congratulate the Minister of State for Finance for finally going ahead with this important process. As we know, we have had several papers in the past, but this minister has really started the process. He has taken a pragmatic approach and not a theoretical one.
The major objective, as I see it, is to make our financial institutions more competitive for the benefit of consumers. The world of financial services has been changing rapidly for a few years, and we must change.
The Parliamentary Secretary to the Minister of State for Finance covered what I think of as the marketing side very well a few minutes ago. He did that very thoroughly.
Today I am going to deal primarily with the elements of ownership proposals affecting banks, trust and loan companies, life insurance companies, property and casualty companies, and the like of credit unions.
The federal government does not propose that a single ownership structure be imposed on all federally regulated financial institutions, or that a total ban on commercial enterprises acquiring any financial institution be enacted. The issue has been debated at length by parliamentary committees, industry associations, financial institutions and their owners. Arguments have been made in favour of both widely held ownership and closely held ownership and it is apparent that no ownership model is correct to the exclusion of all others.
The proposed legislation thus puts forward a pragmatic approach by allowing both forms of ownership to continue to exist within a strengthened regulatory environment.
Let me take a few minutes to discuss our bank ownership proposals. The proposed revisions to the Bank Act would permit chartered banks to be either
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widely held, on a path to wide ownership, or directly owned by a widely held regulated financial institution.
For Schedule I banks, which include the six largest domestic banks, the revised Bank Act would maintain the current regime of wide public ownership. Wide ownership of banks prevails in one form or another in all western countries and in Japan. The policy would ensure that the big six domestic banks would remain widely held with no one person or group of associated persons owning more than 10 per cent of any class of shares.
The existing Bank Act permits a Canadian or a group of Canadians to start a Schedule II bank and own it on a closely held basis for the first 10 years after receiving a bank charter. After that time, it must become widely held. This provision would be maintained in the new Bank Act.
As well, the new Bank Act would continue to permit a foreign bank to apply for permission to establish a foreign bank subsidiary in Canada, designated as a Schedule II bank.
In the new measure, the proposed Bank Act would expand the Schedule II bank designation to include banks that are directly owned by, and continue to be owned by, widely held regulated financial institutions that are not themselves banks, whether they be Canadian or foreign.
Owners of such a bank could be widely held trust, loan or stock life companies as well as mutual insurance companies or widely held securities dealers. As is currently the case for foreign banks that wish to establish banks in Canada, one of the factors that would be considered prior to giving approval for a widely held financial institution to own a bank would be the presence and nature of non-bank activities operated by the parent of the proposed bank.
If the ownership of a Schedule II bank subsequently changes as a result of a takeover or of the parent bank by an unregulated entity, for example, the Schedule II bank would be required to be widely held within 10 years. If it wishes to remain closely held, it could convert to become a federally incorporated trust company.
As to the ownership of non-banks, the trust and loan company bill and the insurance companies bill will permit federal trust, loan and stock insurance companies
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to continue to be closely held and if sold, to be sold on a closely held basis.
A federal trust, loan or stock insurance company with $750 million or more in consolidated capital would be required, within five years, to take the necessary steps to ensure that at least 35 per cent of the total voting rights in the company are attached to shares that are widely held and listed for public trading on a Canadian stock exchange. A Canadian financial holding company or Canadian regulated financial institution could be eligible to meet the rule on behalf of its trust, loan or insurance company subsidiary.
Schedule I banks would automatically meet the 35 per cent rule by virtue of their 10 per cent ownership limit. The 35 per cent rule would not be relevant for Schedule II banks that are required by legislation to meet the 10 per cent wide ownership requirement within a 10 year period.
For other Schedule II banks, the 35 per cent rule would apply where a capital size of $750 million is reached because of the acquisition of a large domestic institution that, prior to the acquisition, was itself subject to the 35 per cent public shareholding requirement. A ministerial exemption from having to meet the 35 per cent requirement will be available for institutions that reach $750 million in capital through internal growth. Other situations, such as reaching the $750 million capital threshold through successive acquisition of a number of small Canadian financial institutions, would be examined on a case-by-case basis.
An extension of the five-year time limit would be possible where general market conditions warrant and the minister is satisfied that a company has used its best efforts to satisfy the rule.
The 35 per cent rule will ensure a significant public shareholding to provide a counterbalance to the influence of the majority shareholder. An element of broad public ownership can bring benefits in terms of ensuring market scrutiny and establishing the basis for sound, corporate government.
As for foreign ownership, the existing foreign bank regime will be maintained. However, the foreign bank guidelines will be modified to cover entry by non-resident widely held regulated financial institutions that are not banks, such as life insurance companies and securities dealers. In addition, the so-called 10/25 foreign

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Government Orders
ownership rules now found in federal legislation, which limit acquisitions of Canadian controlled financial institutions by non-residents, will be based on a broader definition of control.
As part of the Canada-U.S. Free Trade Agreement, U.S. residents are not subject to the 10/25 rules. As noted previously, all significant changes in ownership of federal financial institutions will also be subject to the approval of the Minister of Finance, who will consider a number of factors, including the best interests of the financial system.
An ownership approval process is an important element of the proposed ownership regime. At present, the Minister of Finance has the authority to approve all start-ups of federal financial institutions, but subsequent changes in ownership do not always require approval. It is proposed that this deficiency be corrected by requiring that significant changes in ownership of federal financial institutions be subject to the approval of the Minister of Finance. This will ensure that a takeover is in the best interests of the financial system and that new owners have the expertise necessary to run a financial institution, adequate financial resources and sound and feasible plans for the future conduct and development of the business.
An investor will be required to obtain the approval of the Minister of Finance in order to buy shares of the financial institution that would result in the investor owning in excess of 10 per cent of any class of shares. Similarly, if an investor already owns more than 10 per cent of a class of shares and wishes to purchase additional shares, approval will be required.
Finally, an investor will be required to seek ministerial approval if that investor acquires control of a company that is linked to a financial institution and, as a result, there is a change in the significant ownership interest in the institution. For the ownership approval process, and generally throughout the legislation, control will be defined to include control in fact.
The proposed legislation will permit minor fluctuations in ownership to occur without requiring approval. As well, it will provide prospective owners with the
opportunity to obtain pre-approvals so that they can make business decisions with certainty.
As announced on August 11, 1989, the new legislation would make the approval process for trust and loan companies effective as of that date.
I believe the ownership proposals will work to the benefit of both the financial industry and its customers. I ask that we move forward quickly with the proposed legislation before us today.
As a long-time member of the finance committee I want to say that we are beginning to hold hearings. The member for Ontario might correct me, but I believe the deadline for submissions is November 15. We will be consulting widely with all people affected, auto leasing companies, insurance brokers, banks, trust companies, and credit unions, because this is an important milestone in financial services in this country. We do not intend to get bogged down. Yes, we will consult. Yes, we will take ample time. But, given how quickly the world is changing out there, Canada needs to be competitive.
I think we can be tremendously proud of our banks. When considering what is going on in the United States these days with the trouble that certain banks there have been getting into with bad loan portfolios, look at our banks. They are very sound. Some people might have been a little afraid of the free trade agreement, but our banks, which are class banks, are going to be even more competitive in the U.S. market.
Look at what is happening down there in the savings and loan industry. They are in trouble to the hundreds of billions of dollars. Even though they are closely held, look at the trust companies we have that have been so well managed.
Our life insurance industry, as well as the property and casualty, is not without some problems but frankly, due to the good management, good personnel, and also due to the very fine and thorough inspection by the authorities in Ottawa of their loan portfolio, capitalization rates, and so on, those companies have kept Canada in the forefront by being very sound financial institutions.
I take exception to any person who thinks that we are opening doors for weakened financial institutions. I think it is just exactly the opposite. I take great pride in being a part of this process. I wish it had started three years ago, but it did not. We are into round one and I
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hope that all sides of this House will co-operate to enact the necessary legislation just as quickly as possible so consumers will have better deals out there and the financial institutions will be able to compete more effectively.


Mr. Ronald J. Duhamel (St. Boniface):: Mr. Speaker, I would like to ask the hon. member a question. When I look at a piece of legislation such as this, one of the questions I would like to ask is how does it helps the working man and working woman of Canada? Second, what evidence does he have that it will make us more competitive than U.S. banks, which is one of the points he has made? The answers to those two questions would be of great interest to me.


Bill Attewell: Mr. Speaker, I want to thank the hon. member for the question.
The Canadian banks in this country have approximately 7,000 branches, give or take a few hundred. They are about twice as well branched-if I could use that term-as banks in the United States. There is absolutely no risk that any U.S. bank-and mark my words, check it out in a few years-is going to come into this country and out-branch our fine Canadian system. Our banks have been well placed for years and will be able to service their Canadian customers very adequately, whether it is in a small town like Moose Jaw, Saskatchewan or in downtown Ibronto. I believe the American banks will concentrate more on the commercial loan aspect and other things. So I do not have any doubt there.
This proposal supports the organization of our fine insurance brokers, thousands across the country with small independent agencies, who give personal service and have that expertise. No American will be able to compete. No new American will come in on that.
There are thousands of auto leasing dealers across the country. It is a type of service requiring expertise and personal service. This legislation supports them 100 per cent and they will also be able to compete.
As Canadians, with great respect, I think we often kind of hold our heads down-


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


Bill Attewell: On a point of order.
Private Members' Business


The Acting Speaker (Mr. DeBlois):: On a point of order, the hon. member for Markham-Whitchurch- Stouffville.


Bill Attewell: Mr. Speaker, I did not finish the full 10 minutes of questions. With full consent of the House, might we continue?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: There is no unanimous consent. We shall therefore proceed to consideration of Private Members' Business.


PRIVATE MEMBERS' BILLS - MOTIONS   OFFICIAL LANGUAGES ACT MOTION FOR TABLING OF REGULATIONS
Jean-Robert Gauthier: That, in the opinion of this House, the government should table as quickly as possible the regulations made under the Official Languages Act passed by the House of Commons on July 28, 1988 and promulgated on September 15, 1988.
He said: Mr. Speaker, this motion is dated April 10, 1989. It is over a year old. It is still current, however, because as you know, the government has yet to table the draft regulations for the new Official Languages Act that was adopted here in the House more than two and half years ago.
I would like to thank the hon. member for St. Boniface who seconded Motion no. 408, which asks the government to table as quickly as possible the regulations made under Bill C-72.
Mr. Speaker, I have an impressive chronology of this legislation which, as you know, was adopted by all parties in this House, by a majority of members present, and was unanimously supported by official language minority groups.
Bill C-72 was adopted here in the House on July 7, 1988. On September 15, 1988, more than two years ago, the Act came into force. However, Mr. Speaker, an act without regulations is a paper tiger. It has no teeth. Its teeth are the regulations. It needs regulations if people are to know how it is to be applied.

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Private Members' Business
A few months later, on April 10, 1989, I tabled a motion, the same motion before the House today, asking the government to table its draft regulations. On April 11, in his 1988 Annual Report, the Commissioner of Official Languages asked that the regulations be tabled by the end of 1989. On April 11, I put a question in the House to the President of the Treasury Board, asking him to table the regulations, and if not, why not. His answer, Mr. Speaker, was that consultations were being held.
On October 12, I wrote a letter to Mr. Robert de Cotret, President of the Treasury Board, about the draft regulations, and I asked him again: when are we going to get the regulations? He answered my letter on January 26, 1990, saying it would be as soon as possible.
You need a lot of patience in this House, Mr. Speaker. You need a lot of patience if you want to get this government to act on issues as important as official languages.
On January 26, 1990, in a statement pursuant to S.O. 31,1 again asked the government to table its regulations.
On February 2,1 was back again with a question for the new minister, Doug Lewis, who informed me that he was working on it and that drafting regulations was a lengthy process.
On March 13, 1990, I put another question to the President of the Treasury Board. He told me what I already knew, that consultations were continuing, although everybody said that the consultations were over with. Everybody was saying that, Mr. Speaker. The minority language groups had been consulted, so I got in touch with them, I talked to them, and they told me it was all over with and they didn't know why the government was still hesitating. I don't either.
In his 1989 Annual Report, tabled on April 3, 1990, the Commissioner of Official Languages brought the matter up again. He said the delay was unacceptable. On April 3, 1990, I rose in the House again and asked the government about the regulations to implement the Official Languages Act, and the answer was again very vague: they were involved in consultations.
On April 4, 1990, the Commissioner of Official Languages threatened to resign, and I quote:

So, as a protest against this current situation I am going to consider very seriously the possibility of tendering my resignation unless there are serious improvements because I am an officer of Parliament and I have not been appointed just to sit, watch and make annual reports.
Mr. Speaker, that was a statement made by the Commissioner of Official Languages on CHEZ-106 in Ottawa on April 4, 1990.
On April 4, the same day, I was moved again to ask the President of the Treasury Board, the Hon. Doug Lewis, if he would at least give me an answer and answer some of the letters I had been writing to the government, written to his predecessor, Benoit Bouchard, and Doug Lewis answered that the regulations were being formulated and that consultations were going on.

On April 4,1990,1 moved again, hoping that, in time, I would drive my point home. It is like driving a nail, you have to hit three, four, five times. The same is true of speed signs on the highways, Mr. Speaker. The "100 km speed limit" sign is not posted only at the beginning of the road, but every four or five kilometers. I told myself: "This government is either stubborn or deaf. Let's give it another try." So, I did again on April 10.
On June 14, 1990, the second report of the Standing Committee on Official Languages was tabled. It was not the report of Jean-Robert Gauthier, MP for Ottawa- Vanier, but that of the Committee on Official Languages, which is like the government made up of Conservative members. Still, they asked the government to table as soon as possible its draft regulations made under the Official Languages Act. We are still waiting, Mr. Speaker.
The government has a few more days, until November 11, to respond to that House Committee report. I would hope that, although they did not want to answer the member for Ottawa-Vanier, they will at least have the good sense and heart to answer a parliamentary committee which asked the government for a response within the allocated 90-day timeframe as to why the regulations have not yet been tabled.
Mr. Speaker, I wrote the Prime Minister. I wrote the newly appointed President of the Treasury Board on October 18 asking him to table the regulations. It is
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getting tiresome to keep writing ministers without ever getting an answer.
The Official Languages Commissionner tabled a special report on October 25, that is a mere five days ago, asking the government to table its draft regulations under the Official Languages Act. On the same day, my colleague from Notre-Dame-de-Grace asked a question to the President of the Treasury Board because he too is interested in that project, like my friend from Saint-Henri-Westmount and all my colleagues on this side of the House, Mr. Speaker. We are all interested in seeing this legislation implemented. We have been waiting for two years and a half, and for two years and a half we have been told: be patient and we will get over many problems.
However, one of the problems is that all political parties have approved the regulations, but only one party is in power; it has the power to introduce these famous regulations so that we know why and how the legislation will be applied.
I want to simply remind the House of the purpose of the Official Languages Act. By the way, Mr. Speaker, recently, I read in an editorial a line that said: "Language justice delayed, language justice denied." I think that this is true. When you delay something, it is because you want to deny it eventually. Either you are unhappy, or nervous, or a little insecure. Therefore, I ask the government, again by way of a motion, supported by the member from Saint-Boniface, to table these famous regulations so that we can review them together and decide if they are going to work, because the Act contains some provisions that will allow members of this House to debate these regulations. And if these regulations are not suitable and 30 members want to oppose it, they can do it in this House. We certainly have to start somewhere, Mr. Speaker.
The Commissioner of Official Languages report tabled last week, October 25th, is a special report- something rather rare-and in this report the Commissioner criticizes the fact that some sections of the Official Languages have not been implemented. These are important sections, for example the one dealing with the number of Canadians needed for the federal government to provide services in either official language?
Private Members' Business
Should it be 500, 1 000, 5 per cent, 10 per cent? Nobody knows, Mr. Speaker.
In my opinion, it is quite simple: one person is enough to warrant the provision of a federal service in a country which claims to be respectful of both its official languages, Mr. Speaker. All Canadian wherever they live should be able to communicate with the federal government, and I say federal government, and be entitled to receive in the language of his or her choice all necessary services, information and notices.
The Commissioner criticizes the lack of respect of certain fundamental rights of Canadians. He said, Mr. Speaker, that the failure of the government to issue regulations weakens the confidence of the public in the Canadian linguistic duality. And this is very serious! The refusal of the government weakens the confidence Canadians have in the linguistic duality, because nobody knows how the legislation applies. Even civil servants have received no new directives in two and half years, they do not know how legislation applies to them, what are their own rights, whether they have the right to work in their own language, English or French, and they work for the federal government. It seems to me that these are basic principles which have to be clarified, which must no longer be left in the dark.
Mr. Speaker, I hope the government response to the second report of the Standing Joint Committee on Official Languages will be complete and logical, but above all I hope that between now and November 11, two weeks, the government will have enough courage to do what it has to do, and that is face up to its responsibilities and table the regulations in the House.
By way of example, the Canadian Parliament is debating a bill to levy a new goods and services tax in Canada. What a surprise, Mr. Speaker! We already have draft regulations stemming from a piece of legislation that has yet to be adopted by Parliament! But when it comes to the Official Languages Act and regulations, what is a two and a half years delay!
Mr. Speaker, the Official Languages Act is a fundamental piece of legislation in this country. And if the government has any intestinal fortitude, as I suggest it should have, it should be possible for it to produce the regulations concerning the Official Languages Act. But no! Would it be that monetary considerations take

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precedence over linguistic issues? I ask the question because- Of course, the answer is clear enough.
Mr. Speaker, denying access to linguistic rights-and I say this with all the sincerity I can muster, for the failure to produce the regulations is tantamount to failing to properly apply the Official Languages Act itself-is the same thing as telling Canadians that in their communities they are not entitled to have regulations and a law that are fair, equitable and applicable throughout the country.
My request is not more complicated than that, Mr. Speaker. It is quite honest and I dare hope that today this government will have enough guts not to tell us that it is involved in consultations right and left. It would not be telling the truth. The time for consultation is over. I know full well that there have been four different ministers over the past two and half years, that it is difficult to train a new minister, that departmental officials change constantly, that it is difficult for a minister to get to know all these matters, but I trust that the current minister will show fortitude and make sure that these regulations come out as soon as possible, Mr. Speaker, because it is urgent!
If the government is able to submit draft regulations dealing with the taxes Canadians will have to pay, it should be able to issue regulations dealing with the Official Languages Act! I therefore ask the government to respond affirmatively to this motion.


Robert E.J. Layton: Mr. Speaker, I welcome this opportunity to inform the House about the government's actions to implement regulations under the Official Languages Act. There has been some concern expressed about the time it is taking to put these regulations in place.
In addition to the parliamentary committee on official languages, the Commissioner of Official Languages, representatives of the minority official languages associations and others have urged the government to take action. Now the government is asked to table the regulations as quickly as possible.
The government has been moving as quickly as possible to bring these regulations before the House. The suggestion that the government is not moving quickly
enough is based on misunderstanding about the process which must be followed.
In the 1988 Official Languages Act, Parliament set out in broad terms the course Canada will follow in official language policies and programs. The act sets out the right of the public to communicate with and receive services from offices of federal institutions in the national capital region and in other offices where there is significant demand for services in English and French and where the nature of the office makes it reasonable to provide these services in either language.
The act also sets out some veiy specific responsibilities, particularly for Treasury Board. The act directs that the Treasury Board take responsibility for the general direction and co-ordination of policies and programs for all federal institutions exclusive of Parliament for the implementation of the Official Languages Act. Treasury Board is also responsible for recommending regulations to cabinet. The President of the Treasury Board must present Parliament with a draft of any regulations that the Governor in Council intends to put forward.

Mr. Speaker, our government is anxious to consult the public before adopting regulations which are likely to affect them. A preliminary consultation seems the best way to ensure that the regulations are workable, fair and equitable.
In 1986, the government developed a policy for the drafting and publication of federal regulations. When dealing with such basic issue for our society as the official languages, Parliament took a number of additional steps by including in the Official Languages Act the process to be followed for the adoption of the regulations. That is precisely what we are doing!
If I may, Mr. Speaker, I should like to review the four main steps leading to the adoption of the regulations under the Official Languages Act.
The first stage is the most time consuming because all interested parties are supposed to participate into it.
To open the consultation process, the government publishes every year a statement of intention in its Federal Regulatory Plan, to inform Canadians of the regulations to be passed during the year.
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In the case of the regulations made under the Official Languages Act, this document provides a short description of the general objectives and scope of each regulation.
As all hon. members probably know, a first series of consultations was held with representatives of both French and English communities throughout Canada to obtain their views on this matter. These consultations are compulsory under the Official Languages Act.
The proposals were then reviewed in the light of the views expressed in order to better reflect the needs identified during the consultation process.
Moreover, in keeping with the announcement he had made in this House, the previous President of the Treasury Board met with representatives of the two main umbrella agencies, namely the Federation of francophones outside Quebec and Alliance Quebec. He than knew for sure that no other propositions were better than the ones put forward.
Now that these preliminary consultations are over, the government can confirm to the members of this House that it is now ready to proceed with the approval of the proposed regulations as soon as possible and in the most appropriate way.
[English\
In the second stage of the process set out in the act, there is consultation with Parliament. This second stage, which is also unique, gives members the chance to study the regulations thoroughly.
To this end, the act says that the President of the Treasury Board shall lay a draft of the proposed regulations before the House of Commons. The act specifies that there must be 30 sitting days of the House before the draft regulations can be prepublished in the Canada Gazette. During the next 30 sitting days of both Houses of Parliament, the general public again has the opportunity to comment on the proposed regulations.
The regulations in draft form are made available to the public in Part I of the Canada Gazette which publishes them along with a description of their expected impact. The comments are studied. If they point out weaknesses or suggest improvements, the regulations can be changed.
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Finally, the regulations are approved by cabinet and published in their final form with a final description of their expected impact in Part II of the Canada Gazette.

Mr. Speaker, the process I have just described is a long and complex one. But in this way all Canadians have the opportunity to express their views on the regulations. That is something nobody should object to.
The process which allows people to make their views known about the regulations is not the only complex criterion we have to meet in order to develop the regulations made under the Official Languages Act.
The regulations themselves are particularly complex.
In the case of the Official Languages Act, we need regulations to make sure the law is applied in a fair, reasonable, and consistent way. To meet this triple goal, we have to examine such concepts as "significant demand", "nature of the office" and "services to the travelling public".
Although mention is made on the Act some general criteria to define more specifically concepts such as "significant demand", the regulations have to take into account contingencies that may not, and should not, be set out in the Act.
As for the "nature of the office", the regulations must take into consideration, for example, the health, safety and security of members of the public, as well as the location and activities of the office.

Hon. members will appreciate that the regulations must be uniform and fair legal definitions, which can accommodate various circumstances in all parts of this country. Such uniformity and fairness is not achieved quickly.
We know that the Treasury Board secretariat has been hard at work for more than a year consulting with minority language associations and holding discussions with federal departments, agencies and Crown corporations.
Regulations are being drawn up which reflect the linguistic realities of Canada and which are fair. The government should not apologize for the time it is taking. The government should not be rushed into preparing regulations in haste. The government should

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be given the chance to consult fully with interested parties.
The act ensures that all Canadians will have ample opportunity to comment on regulations that will contribute to a better service to the public across Canada.
I know that the government intends to propose regulations that are fair and reasonable. As a member of Parliament, this is an objective that I support. I trust that all members will lend the same support to these regulatory proposals once they have been placed before us.


The Acting Speaker (Mr. DeBlois):: The hon. member for Notre-Dame-de-Grace.


Ian Gardiner Waddell: Point of order, Mr. Speaker. With respect, normally there is a spokesperson for each one of the parties. In this case the Liberal Party member brought forward the bill, then the Conservatives responded. It is normally then the turn of the New Democrats.
I do not object to hearing from the member for Notre-Dame-de-Grace. He is always worth hearing from and he will get to be heard, but I think that is the normal round.
With no offence to him, I have to object on that so we do not create any big precedents here.


The Acting Speaker (Mr. DeBlois):: I am the servant of the House. If it is agreeable to the Liberal opposition, I am prepared to recognize the hon. member for Port Moody-Coquitlam.


Ian Gardiner Waddell: On a point of order, Mr. Speaker. It is not a matter of whether or not it is agreeable to other members of this House; we have to follow the procedures and the Standing Orders, the normal process here in this House.
When the normal process is followed, we have a Liberal, a Conservative and a New Democrat and then members of splinter groups.


The Acting Speaker (Mr. DeBlois):: I think I will stand by my decision and immediately after I will gladly recognize the hon. member for Port Moody-Coquitlam.
The hon. member for Notre-Dame-de-Grace has the floor.


Hon. Warren Allmand (Notre-Dame-de-Grace):: Mr. Speaker, it is my understanding that in private members' hour now the rules that apply in ordinary debate do not apply and that you pick speakers as you see them.
Mr. Speaker, the motion presented by the hon. member for Ottawa-Vanier asks the government to table as quickly as possible the regulations necessary to implement the Official Languages Act of 1988 which was passed more than two and a half years ago.
Two and a half years have passed since this House voted on that bill and we still do not have the regulations. It is interesting to note that during that debate the Prime Minister stated that he was willing to have the House sit night and day in order to pass the legislation because it was essential for the country. Those were more or less the exact words of the Prime Minister.
Mr. Speaker, you will recall that the opposition to the bill at that time was not made by any of the opposition parties. The opposition came from certain members of his own party who were referred to by the press as dinosaurs. That opposition was there and the Prime Minister, wanting to get on with the business, said he would have the House sit night and day to pass the legislation because it was essential for the country.
I must ask what happened between those days in 1988 when the Prime Minister thought it was absolutely essential to get this legislation through and the two and a half years which have passed since. One wonders whether the dinosaurs within the Conservative caucus have grown in strength and have now more or less thrown obstacles in front of the government so that it does not have the political will to proceed with this legislation.
I refer to an editorial which was written in The Montreal Gazette of October 29, a few days ago, following the special report submitted to this House by the Commissioner of Official Languages. The headline in
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the Gazette editorial states: "Languages law languishes. Ottawa's delays are letting the country down". Then it goes on to say: "Linguistic justice delayed is linguistic justice denied".
We not only have the promise of the Prime Minister during the debate to implement this legislation quickly, but the Commissioner of Official Languages has pointed out in his recent special report in which he condemned the government for not implementing the legislation a whole list of promises by ministers of the government that we were going to get the regulations soon.
On April 11, 1989, in answer to a question put by the hon. member for Ottawa-Vanier, the President of the Treasury Board said that the regulations would be tabled in the House before the end of 1989. That was a full year after the bill was passed. In any case, 1989 came and passed by, and we still did not see the regulations.
Then, on the first anniversary of the act, the Commissioner of Official Languages put out another press release on September 15, 1989 and asked what was happening, when were we going to see the regulations? Then again, in his famous annual report of April 3, 1990, the Commissioner of Official Languages felt he might have to resign because the government was in contempt of Parliament which had passed the law, and still there were no regulations to implement the legislation.
On the same day the President of the Treasury Board said that before June 23, before the summer, we would see the regulations. That was earlier this year.


[Stage Direction]
The House adjourned at the end of June, the summer passed, and we still have no regulations. I might say that at the end of June the Standing Joint Committee on Official Languages issued a special report, a unanimous report, including Conservative members of the committee, Liberal members of the committee, New Democratic members of the committee, and senators from both parties, requesting the immediate tabling of the regulations to implement the legislation.

The House came back in September, and we still have not had the regulations. I raised the question a few weeks ago in an adjournment debate and the parliamen-
Private Members' Business
tary secretary came to the House and said: "Soon". Well, Mr. Speaker, soon is not good enough.
As a result, we see the Commissioner of Official Languages has once again condemned the government for its delays.
The minister, the parliamentary secretary and, again this afternoon, my hon. friend from Lachine have said that the reason is consultation. I have been in touch with the groups that were the subject of that consultation, and they say the consultation was over long ago.
When the Commissioner of Official Languages tabled a special report last week, he said in the press conference which he gave that he himself had been in touch with the groups, the Federation des francophones hors Quebec, Alliance Quebec, and the other francophone minority groups in the country, and they said that the consultations were finished. They do not understand what this talk is about consultation.
The reason is not consultation. We have no clear evidence. The reason appears to be a diminishing political will due to something that is happening within the Conservative caucus, but that is not reason enough.
While this delay has been taking place, we know that there has been a growing opposition to official bilingualism in this country, and that is unfortunate. Following the failure of the Meech Accord we have seen the growth of intolerance on both sides. Polls tell us that the majority of Canadians still favour official bilingualism, so the government should listen to those polls in this case. It should move ahead despite that growing opposition, but it is not showing the leadership.
The opponents to bilingualism are speaking out. I refer to groups such as APEC, the Association for the Protection of English in Canada, a unilingual, anglophone group which is anti-francophone, the Reform Party which has taken a position against the Official Languages Act, the COR Party, and certain Ontario municipalities which have passed resolutions against official bilingualism. That is on the anglophone side.
On the francophone side we have seen the Government of Quebec pass Bill 178, contrary to the court decisions at three levels in Quebec: the Superior Court
[Stage Direction]
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Private Members' Business
of Quebec, the Court of Appeal of Quebec, and the Supreme Court of Canada. Yet the Government of Quebec introduced and passed Bill 178, contrary to the principles of good bilingualism. We have seen, as well, the growing strength in the polls of the Parti Quebecois and the emergence in this House of the Bloc Quebecois, groups which are not fully favourable to official bilingualism.
While this growing opposition to bilingualism has been taking place since the failure of Lac Meech, the government has not shown any leadership.
It introduced a bill in 1988. Every opposition party supports that bill. The only ones who oppose it are a few dinosaurs in the Conservative Party. We support the government's bill, and the government has not implemented it for one reason or another.
That is not good enough. I would hope that somebody representing the government would intervene. I know that my hon. friend from Lachine has intervened. He comes from the anglophone minority of Quebec, as I do, but we want somebody representing the ministry. We want somebody representing the Prime Minister who will stand in the House this afternoon and say: "We are going to introduce those regulations next week" and "we are going to move ahead with official bilingualism in this country".
Mr. Crosby:: Mr. Speaker, I rise on a point of order. I think, in the interests of the orderly conduct of this debate, there would be agreement in the House to hear next the member for Port Moody-Coquitlam and afterward two members from the government side, beginning with the member for Temiscamingue if that is agreeable.


Ian Gardiner Waddell: Mr. Speaker, I rise on the point of order.
I agree with that, since I am the next one to speak, but I do not need permission to be able to speak. As the third party the NDP should be speaking next.


The Acting Speaker (Mr. DeBlois):: There is no problem. The hon. member for Port Moody-Coquitlam has the floor, and I thank him for his understanding and his collaboration.


An hon. member:: Why two Liberals before the NDP? It is not fair.


Ian Gardiner Waddell: Mr. Speaker, my friend says: "Why two Liberals before the NDP? It is not fair". Don't worry, after the next election there will be two NDP for every Liberal.


Some hon. members:: Oh, oh.


Ian Gardiner Waddell: Mr. Speaker, I just want to say to the member who last spokes, my friend from Notre-Dame-de-Grace, that he put his finger right on it by saying that there is a diminishing lack of political will in the Conservative caucus. That is the only reason that we can see why this bill and its regulations are not being implemented. Everybody agrees. It is not a question of consultation.
The other matter that he underlined-and he has much experience in this area and is worth listening to in the House-was that there is a growth of intolerance in Canada. The member and I sat on that Joint Senate-House of Commons Committee on Official Languages when APEC, the Association for the Protection of the English Language, came before it. We could see the intolerance.
As the member pointed out, there is intolerance both on the side of the French and on the side of the English. It is not restricted to one side. The member spoke out eloquently at that committee meeting and asked some pretty pertinent questions. He has always taken the position that we have to fight intolerance, whether it is English or French, anywhere in Canada. I just want to underline that I totally agree with him on that.
The question as he raised it at the end is-and if he had more time he could talk more about it; maybe I will-who is speaking for Canada? Who is showing some leadership for this country? Who is trying to bring it together?
I watched the Prime Minister in Question Period. He spends a lot of his time making cheap points. "Well, that belongs to the responsibility of the last Liberal government", or "I can quote from Jean Chretien who said" such and such, or "I can quote from Ed Broadbent" who said such and such, or "I can quote the member of Kamloops".
October 30, 1990

Those are cheap political points. I was ill at home last week in Vancouver so I watched television. I watched you on television, Sir, doing a superb job in your debut as deputy speaker. It is very interesting to watch this House for a bit. The Prime Minister should take a week off and go home and watch the House on television. Maybe he wouldn't be so smart-alecky and so quick to put down things rather than explain things to the Canadian people and show some leadership.
Let me deal with a couple of points in this debate. First of all, to the member for Lachine-Lac-Saint- Louis, the Conservative member who spoke for the government, I was going to say: Murder your speech writer, but that is a little too much. Take your speech writer out, he or she, and just hit them over the head a little bit. Wake him up. Get rid of it. Tear up the speech.
The hon. member is thoughtful and gives good speeches, but what an apology for bureaucratic inertia. It is one of the worst apologies I have heard. He said that the government has moved as quickly as possible. Is this moving as quickly as possible? This government makes a tortoise look like A. J. Foyt, the racing driver, it moves so slow. A tortoise moves quickly compared to this government.
Have you ever heard of Mackenzie King, Mr. Speaker? He used to be famous as a Canadian politician who always put off decisions. Sir John A. Macdonald, "old tomorrow" they called Sir John A. Macdonald. This government makes Sir John A. Macdonald look faster than a speeding bullet in making a decision, or Mackenzie King, because it simply is not making any decisions in this area.
The hon. member says that we are misinformed and that he will inform the House. It is not just us who are misinformed. Tell that to the Commissioner of Official Languages who does this job full time and is expert at it. He says that the government is dragging its feet.
What a pitiful excuse in that speech for bureaucratic dilly-dallying. He spoke of consultations and revisions. I made notes of this. Three times he spoke of revisions and he made four mentions of consultations, the first stage of consultations. Then there was the second stage of consultations, and no doubt there will be the third stage or the fourth stage.
Private Members' Business
MPs can study it and it can get in The Canada Gazette. It just goes on and on and on. The bureaucrats are fiddling while Canada is burning. We should get down on our knees and ask God, he or she, to say to the government: "For God's sake, show some leadership in this country".
This is not an unimportant area; this is a very important area. Let me just recap the motion and give a viewpoint from the New Democratic Party on this motion. The motion is that in the opinion of the House, the government should table as quickly as possible-

"As quickly as possible", in the other official language. [English]
-the regulations made under the Official Languages Act passed by the House of Commons on July 28, 1988 and promulgated on September 15,1988. This is October 30, 1990, and we are still waiting.
The background of the issue is as follows: Bill C-72 was passed in the House on July 20, 1988. The government has not presented the regulations required to put the bill into force. That is the way legislation like this works.
This spring, in the annual report of the Commissioner of Official Languages, there was a condemnation of the government for its failure to act. This matter was a principal issue at a hearing by the Joint Senate-House Committee on Official Languages.
Mr. Fortier of Alliance Quebec, the Federation des francophones hors Quebec and even APEC, the Alliance for the Preservation of English in Canada, participated.
Toute la gang was there.
Last week, Mr. d'Iberville Fortier, the Commissioner of Official Languages, issued a special report into the government's failure to enforce the Official Languages Act, 1988. He said in part: "If we want to make our country go on, the least we can do is make sure acts of Parliament are respected. Two years later this act still does not have teeth. These delays may well endanger the linguistic progress made in federal institutions over the years".
We may go backward as a result of not having these regulations. Mr. Fortier justified this extraordinary action, because it is, by noting that if the regulations were not tabled soon, providing 30 working days for Parliament to study them, they cannot be published-and the

October 30, 1990
Private Members' Business
member should listen to this-in The Canada Gazette. If the House prorogues, as this House might, we will have even further delays.
It is therefore fortunate that this motion has come forward for debate at this time. I congratulate the hon. member for Ottawa-Vanier for bringing it here.
I will not debate the substance of Bill C-72 or why the regulations are needed. I think the heart of the matter is why the government is not delivering here. What is, as Mr. Justice Oliver Wendell Holmes once called it, the inarticulated major premise? In other words, what is stopping the government? None of this gobbledegook that the member across gave. What is the real reason? This legislation has faced strong opposition from a number of groups who have never accepted the need and support for official language minorities, and have never accepted a bilingual Canada.
I think both these groups are represented within the Conservative caucus; nationalists from Quebec, and what my friend called dinosaurs from English Canada. It seems to me that the Prime Minister is afraid to take on these groups in the name of a higher cause, namely the unity of Canada.
I will give you an example of where the government is going. Tomorrow we are going to debate a bill on broadcasting. The government has withdrawn a clause which states that the CBC has to promote national unity, because national unity is a dirty word now for this government. I ask, where is the vision in this country of Henri Bourassa or Sir Wilfrid Laurier, who believed in a society of tolerance and believed in bilingualism from coast to coast where people at least had a right to be served and communicate with their government in their own language. That is all that the official languages does. It implements that vision, which is limited if anything.
I do not understand why the government is not bringing this in.

Mr. Speaker, this year we celebrate the 25th anniversary of the Royal Commission on Bilingualism and Biculturalism. The vision expressed in this report's recommendations have had a tremendous impact on the history of this country. The central recommendations of
the report, the principle that official languages minorities in Canada should be assured to get public services in their mother language, the idea that French as much as English should be a working language in Canada, were reflected in the Official Languages Act of 1969. The Canadian Charter of Rights and Freedoms is in the legislation in question today.

The government is celebrating the twenty-fifth anniversary of the Laurendeau-Dunton report on bilingualism by taking a step backward. The Prime Minister said these regulations wall be tabled at the most precipitous moment. For whom? When? It seems to me that there is a clear lack of leadership here.
Let me conclude by saying this. The government is endangering the whole policy of official bilingualism. The government is leading to more intolerance. It is growing in Canada on the part of the English and French and on the part of extreme groups like the Bloc Quebe-cois on one side and the Reform Party on the other. Who speaks for Canada? We need vision in the leadership of this country. Sometimes it is tough. Sometimes you have to face down the bigots. It is not easy to say that to some people in Canada. We want these regulations. We want them now.


Mr. Gabriel Desjardins (Temiscamingue):: Mr. Speaker, it is with great interest, as co-chairman of the Joint Committee on Official Languages, that I participate in today's debate. I would like to take this opportunity to mention the names of my collegues who talked sooner today, that is the members for Ottawa-Vanier, Notre-Dame-de-Grace and Lachine-Lac-Saint-Louis, because they are people with whom we work regularly in committee and who really strive to protect the interests of the French and English minorities in Canada. I believe we must recognize the good work done by my collegues on the committee.
The member for Ottawa-Vanier gives us the opportunity with the motion he presents today and which says: "That, in the opinion of this House, the government should table as quickly as possible the regulations made under the Official Languages Act passed by the House of Commons on July 28, 1988 and promulgated on Septem-
October 30, 1990

ber 15, 1988", to show how this government has fullfilled its obligations regarding official languages in this country.
Having been a member of the Joint Committee on Official Languages, the member for Ottawa-Vanier knows full well that these last few years, since 1986 or 1987, it is the minority groups who complain during the committee hearings that the law had become ineffective. It is a law on official languages, one must recognize, which was adopted in 1969 by the then liberal government, and which, over the years, has become ineffective.
I have a question for the member for Ottawa-Vanier, who strives so much to protect the interests of the French and English minorities in Canada.
For 15 years, he witnessed the ineffectiveness and the degradation of the Official Languages Act. Why did he not ask his government at that time to bring in regulations to give teeth to the legislation? No, Mr. Speaker, Canadians had to wait until 1984 when the Progressive Conservative government was elected. We promised major changes and reform of the Official Languages Act and we delivered. The Act was amended with the support of all parties in the House and with the support of all groups of society. The new act that our government put in place in 1988 was hailed by both the English and French media and by everyone else.
This means, Mr. Speaker, that when you talk about something, you have to put it in the right historical perspective. For 15 years, our linguistic minorities had to live under an act which had major flaws and shortcomings that we spent sitting after sitting denouncing at the Official Languages Committee. We acted and, as a result, we have an effective legislation. It is important to note, Mr. Speaker, that the absence of regulations does not preclude the application of the Act. This Act is in effect since September 1988.
Every French-speaking citizen living within an English-speaking majority and every English-speaking Canadian living in a majority French-speaking community is entitled to be tried and to work in the language of his
Private Members' Business
or her choice. Minorities have the right to equitable participation at work and have rights before the courts that they did not enjoy under the previous legislation, Mr. Speaker. At the present time, any citizen, with the help of the Commissioner of Official Languages, can lay charges against any federal institution or any organization that does not comply with the Act. Those are some of the positive aspects we included in the new legislation.
To get back to the motion of the hon. member for Ottawa-Vanier, on June 14, as Joint Chairman of the Joint Committee of the House and the Senate, I tabled, and I will read it to you, a report by our committee asking the government to produce its regulations as soon as possible, Mr. Speaker, and I may point out that according to Standing Order 109, the government has 150 days to do so. As the hon. member for Ottawa-Vanier mentioned, this period ends on November 11, and since November 11 is a holiday, as the House is aware, it means that the actual deadline is November 9. Personally, I am convinced the new President of the Treasury Board will table his response to our report by November 9, and that this response will involve the tabling, very shortly, of those long-awaited regulations.
I think the hon. member for Ottawa-Vanier mentioned that he respected and trusted the new President of the Treasury Board. Mr. Speaker, you realize he was sworn in on September 20, 1990, barely a month ago. When we consider the importance of his department, of the position of the President of the Treasury Board who has to look after the Public Service and all the departments in terms of their budgets and human resources, and when we consider that the new President has already given the new regulations some thought, I think this shows he is genuinely committed to going ahead with the regulations. Opposition members would probably have liked the President of the Treasury Board to hastily table regulations totally unknown to him as soon as he was sworn in. regulations totally unknown to him. Those who know the hon. member from Quebec City see him as a reasonable and responsible man who wants to have a thorough knowledge of the issues before he makes a decision. Is it to much to ask to give him a month to study the regulations we are about to table? I do not think so. In due time, the President of the Treasury Board will make his position known and I am sure it will be along the lines of the commitments made by the Prime Minister and our members to our official language minorities.

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Private Members' Business
Mr. Speaker, 150 days may seem like a long time. Our report was tabled on June 14, and the government has 150 days or about five months to answer. Let us have a look at what happened since then. Our report was tabled on June 14. Two weeks after that, the House adjourned for the whole summer. We returned on September 24. We have been here for a little more than a month, Mr. Speaker. So chronologically, I think the two-year delay that has been mentioned can be explained easily in the light of what I have just said. Two years may seem like a rather long time, but above all it proves one thing, that there has been consultation, as the hon. member for Ottawa-Vanier said, even too much of it, but the fact we consult the population when we legislate has been one of the characteristics of this government.
Contrary to what Liberals did for a long time, we do not practise a policy of confrontation with the provinces and the Canadian society. We practise a policy of consultation and dialogue. Maybe we are making too many consultations, it is possible, but it is better to consult wisely in order to bring forth a beautiful baby, Mr. Speaker, a good regulation which will be long lasting and will satisfy the different official language minority groups in the country.
Mr. Speaker, I could speak at length of the consultation process, I could mention all the organizations- There are thirty-six associations for official language minorities in the country. They have all been consulted, and not only once, but twice, Mr. Speaker. The first time was during the 1989 summer, when the Office and Treasury Board officials drafted the first bill. We were determined to consult every one of these organizations across the country, to know for sure what they really wanted. Then, we took note of their demands and we went back to see them, Mr. Speaker.
Therefore, this shows how concerned and how serious the government has been about these regulations. Mr. Speaker, I see you are trying to tell me that my time has expired. I just want to say that I am convinced that the President of the Treasury Board will follow up on that demand in accordance with our committee's report and that we will soon have good and lasting regulations which
will meet the needs and expectations of the minority groups in this country.


The Acting Speaker (Mr. DeBIois):: The hon. member for Halifax West. You have two minutes.


Howard Edward Crosby: Mr. Speaker, that is time enough to make a few points on behalf of the President of the Treasury Board who is the minister responsible for the implementation of the Official Languages Act.
First, let me confirm the support of the Government of Canada, particularly the Prime Minister, to the policy of official languages in Canada. It was the government of the Prime Minister that brought in the Official Languages Act and improved the language law in Canada in 1988.
That is not all. As late as February of this year, 1990, the Prime Minister rose in this House and proposed a motion that this House reaffirm its commitment to support, protect and promote linguistic duality in Canada as reflected by this House in the Constitution amendment and the Official Languages Act of 1988.
There is no wavering in the concern and in the support for official languages policy from the Prime Minister or the Government of Canada.
I want to point out to members of the House some matters that transpired in this debate. We heard the member for Port Moody-Coquitlam and the member for Notre-Dame-de-Grace talk about the turmoil in Canada over language and other constitutional matters.
In the midst of that turmoil do members want to create more havoc by creating more uncertainty and difficulty? The prudent course is the slow course: the course by which we examine carefully the language proposals; by which we make sure there is consensus across Canada to those proposals. That is what the minister is doing.
I remind the very members who spoke in this debate that they approved the complex procedure under the Official Languages Act that is required to be followed so that there will be consensus to the ultimate regulations. That is why we have consultations. That is why we have a specified period for examination and re-examination in the House of Commons.
October 30, 1990

All members supported that process, and now they cannot deny the results of it. The President of the Treasury Board, the Government of Canada, will proceed with the implementation of the regulations. And the regulations will be acceptable to the great majority of people in Canada.


The Acting Speaker (Mr. DeBlois):: The time provided for the consideration of private members' business has now expired.

Pursuant to Standing Order 96(1), this item 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.

Bill Attewell: Mr. Speaker, on April 3, 1990,1 rose in the House to ask a question of the Minister of Justice regarding gun control legislation in Canada.
When I rose in the House in April to address the urgency of gun legislation, the country was reeling in the aftershocks of the massacre at the Ecole Polytechnique in Montreal. Concerned Canadians were shocked and horrified by the senseless murder of young women by a man who should have been denied access to a firearm. Canadians across the country then turned their outrage and sorrow to action. On April 9,1990, a petition bearing the names of over 500,000 Canadians was presented to Justice Minister Kim Campbell. The message was clear. Canadians want tougher gun control legislation.
On June 26,1990, the Minister of Justice introduced a comprehensive package to strengthen the control of guns in Canada. The proposals provide a minimum waiting period for a FAC, a provision for two references who have known the applicant for at least three years,
Adjournment Debate
national firearms safety training courses, mandatory testing for would-be gun owners, and the establishment of a Canadian Advisory Council on Firearms.
The need for a balanced approach when dealing with the issue of gun control is essential. I want to make it clear that members of gun clubs are, for example, not the problem. I visited the Sharon Gun Club last fall and I was very impressed with their safety regulations. I do not want those good law-abiding citizens unduly harmed or inhibited by any gun control legislation.
For example, the proposal to limit the magazine or clip size to 5 and 10 for certain firearms is totally impractical. While it is important to recognize the rights of the responsible and legitimate firearm owner, legislation must deal harshly with criminals, gun dealers, and others, using or trading illegal or unauthorized firearms.
Stiffer sentencing, one of the important parts of the new proposed legislation, is essential to protect the public from attacks and murder by criminals. We should also consider additional years in jail if a firearm was used in a criminal act.
Since 1978 when tighter gun control legislation was introduced, the number of robberies, homicides, accidental deaths, and suicides involving guns have all decreased. There are about 1,400 firearm deaths each year. However, almost 85 per cent of these deaths were suicides. Homicides totalled approximately 180 deaths.
While these numbers tell us violent crimes involving firearms are decreasing, crimes still occur that could be prevented through tougher legislation. A case which I believe demonstrates the urgent need for tighter gun control laws is the attempted deportation of Robert Cave.
Robert Cave was sentenced to seven years in prison for several armed robberies in 1981, including the brutal and threatening attack of a 21-year old woman who was managing the McDonald's restaurant he robbed. This woman was terrorized by Cave who at the time was high on drugs. He shoved the nozzle of his pistol up her nose as well as using other threatening gestures. Robert Cave was given only two years for the use of a firearm in the commission of the robbery, in spite of his past criminal record and the obvious brutal way in which he used the weapon.

October 30, 1990
Adjournment Debate
Those convicted of an offence involving firearms should pay through hard time. We must make the country safe for all abiding and upstanding citizens. More care and compassion must be directed to the victims of violence.
There is another aspect of our justice system which must be changed in order to better protect our citizens. I am referring to our extradition laws.
Charles Ng fled the United States five years ago to escape prosecution and still remains in Canada. Charles Ng, a former U.S. Marine, was charged in California with the sex slayings of 13 people, allegedly committed between 1984 and 1985. In 1985, following a month-long international man-hunt, Ng was apprehended in Calgary after a bungled shoplifting attempt. Five years have past since his arrest in Alberta and Ng still remains in Canada fighting an extradition order thereby escaping prosecution in California.
I think it is possible that Canada could become a haven for criminals such as Ng, criminals who, facing the prospect of a death penalty, flee to Canada to escape prosecution. Because of Canada's close proximity to the U.S. and its long, continuous border affording many opportunities to flee, this notion is quite real.
We must not only toughen gun legislation but all legislation dealing with criminal justice. It is absurd to think that people such as Cave and Ng have more judicial options and opportunities available than does a Canadian citizen who is accused of committing a crime. Let us stand up for the right of all Canadians to live in a nation which provides them a sense of security and well-being. Our laws must provide more protection for society and a greater sensitivity to the victims of violence and their families.
In closing, I want to say that I held a town hall meeting in Stouffville last Saturday morning, October 27, 1990, to hear the views of the residents of my riding regarding the proposals to strengthen gun control in Canada. There were almost 40 people in attendance. I was assisted by three panellists: Norm Gardner, Vice-Chairman of the Metropolitan Police Commission; David Brown, a former police officer and a sports shooter; and Morton
Greenglass, a lawyer and legal expert on gun control and a sports shooter as well. A number of good constructive recommendations were proposed, and I will be presenting many of these to the Minister of Justice.


Mr. Rob Nicholson (Parliamentary Secretary to Minister of Justice and Attorney General of Canada):: Mr. Speaker, since I only have three minutes available to me, I will address the member's first concern, which is that of gun control.
I would like to say that the Minister of Justice shares the concerns of the hon. member. She is certainly aware of the strong desire among members of this House and the Canadian public for effective gun controls.
Gun control is a very complex issue. Many of our northern and aboriginal citizens, for instance, require firearms for their livelihood. We must try to balance the concerns of all Canadians about public safety with the legitimate interests of the responsible law abiding firearms community.
It should be pointed out that Canada already has one of the best gun control systems in the world. It has also been pointed out that more can be done.
It has been demonstrated that some types of firearms, those of a military nature, have become a problem since the law was last amended.
Bill C-80 represents a considered response to these concerns that will help assure the safety of the Canadian public with the least possible interference in the interests of legitimate and responsible gun owners.
The previous Minister of Justice, who is now Minister of Transport, had the benefit of extensive consultations with the provinces and many firearms interest groups during the summer of 1989. The present Minister of Justice intends to pursue the consultation process as the bill proceeds through Parliament. In particular, the Canadian Advisory Council on Firearms is being set up to give members of the firearms community and other interested parties access to the consultation process.
The intent of the amendment proposals is to address a number of concerns that have arisen since the law was last amended in 1978. Some of these have to do with the screening of applicants for firearms acquisition certificates and other documents.


October 30, 1990

Adjournment Debate
It should be kept in mind that some types of firearms present a risk because they have a design or firepower that cannot be justified with any legitimate or socially useful purpose in mind.
Our problem is to make a distinction between those firearms that have a legitimate sporting and hunting purpose and those that do not. This is what Bill C-80 attempts to address.
I can tell the hon. member that the consultation process that was begun by the prior Minister of Justice will continue. I am looking forward to this piece of legislation getting into committee so that we can hear some other concerns of Canadians who have taken an interest in this area.


GOODS AND SERVICES TAX
Ronald MacDonald: Mr. Speaker, I rise today to give a little further information and perhaps a little more in-depth questioning on a question that I asked in this place on October 2.
I asked two questions. I am not sure to which one the parliamentary secretary will be responding this evening, but I am going to address both those questions because that is what I put in for.
The question I raised that day dealt with the advance collection of the goods and services tax. The particular case in point was a lady in Halifax County who had prepaid a ticket to Florida, and the travel was to take place in April of next year. She was absolutely astounded when Air Canada called her back and indicated that she not only had to pay in advance of the ticket, which she fully expected, but she also had to pay in advance the 7 per cent goods and service tax. That lady was incensed, as she should have been. She called my office, she went to the media and she said: "This act is not yet law and not only is it not yet law, and the government and the bureaucrats will come up and tell me reasons why they can still collect it, but my goodness, it is facing the fight of its life in the Senate of Canada". Eight-five per cent of Canadians have consistently been opposed to this form of taxation. Surely to goodness the government is not going to tell consumers across this country that they have a legal obligation to pay that 7 per cent goods and services tax in advance of January 1 or whenever that act becomes law. Hopefully it never becomes law.
I asked the Minister of National Revenue if he would give us an unequivocal statement, to stop trying to dance around the issue, on whether or not he had instructed businesses across Canada that they had no legal obligation to demand from a consumer that tax be paid in advance of January 1.
With the glibness and smugness of this Minister of National Revenue, he got up and said: "No, I won't because I have done that on August 9". If he did it on August 9, he certainly should have done it again the day I asked because in the next few days the media was full of reports of outraged consumers from coast to coast in this country who had been told by this government that they had to pay the 7 per cent goods and services tax in advance. The minister likes to have it both ways.
This government has spent over $30 million. It is a lot of money, hard-earned money that has been taken from the taxpayers of this country, $30 million to put out propaganda, some of which has been found to be false and misleading by the Advertising Standards Council of Ontario dealing with this proposed, wonderful great thing that the government is trying to foist upon the Canadian public called the goods and services tax.
Instead of doing his job, the Minister of National Revenue refused in his next propaganda mail-out to big, medium and small business in Canada to tell those businesses that they had no legal right to collect in advance the goods and services tax. He did not want to come forward and do what he should have done under the law and tell those businesses that they had no right.
My second question that day was to the minister who was supposedly responsible for consumer interests, the Minister of Consumer and Corporate Affairs. I said: "My goodness, are you going to do the right thing? Are you going to do what your job is and protect the interest of consumers and ensure that they know that they have no legal obligation to pay in advance the 7 per cent goods and services tax?" He was mute. He was silent. He was in the House that day but he was mute and he allowed it to go back over to the Minister of National Revenue.
I am going to tell you, Mr. Speaker, it will be a sorry day for consumers in this country when it is the Minister of National Revenue who is looking after the interest of

October 30, 1990
Adjournment Debate
consumers. It is supposed to be the Minister of Consumer and Corporate Affairs, but, again, that minister did not do his job, not just for the lady in question in Halifax county who found it repugnant that she was being forced to pay a 7 per cent goods and services tax on the advance purchase of airline tickets, but for every consumer in this country.
I asked that day in my supplementary question to the Minister of Consumer and Corporate Affairs how he could in all good conscience have sat at the cabinet table and allowed the government, the cabinet of the day to approve expenditures, a multi-million dollar series of expenditures to put out propaganda to the Canadian public, to the consumers of Canada which he knew to be false and misleading. If he did not know at the time, he should have listened to the Advertising Standards Council this summer when it said that the radio ads that were paid for, not by members of the government, anybody out there who is watching, but by your tax dollars. The government was trying to fool Canadian people and do it with their own money, for goodness sakes.
I asked the Minister of Consumer and Corporate Affairs that day whether he was prepared to do the right thing and dissociate himself from the propaganda campaign of this government. As I said, he remained mute.
The Canadian public has not decided that they are going to lay down and die on the goods and services tax. The latest poll that is out, it was just one poll. I guess I could not quote it with a great deal of authority, but it is one of a series of polls that have been done since this government embarked on that dangerous path for Tory-dom called the goods and services tax. Every single poll that has been taken regionally or nationally shows that this government is out to lunch in its pursuit of the GST. Maybe if the government was supported by 51 per cent of Canadians, but 85 per cent did not like the tax, you might say, "Well, maybe it is a passing fancy".
The numbers speak for themselves. Seventy-five per cent of Canadians in the last poll that was done said that they were absolutely, fundamentally opposed to this regressive, crazy, insane tax, called the GST, particularly
at a point in time when this government's policies have driven the economy of the country into recession.
The only lower approval rating for any issue that was in the poll was for the popularity of this government. Only 15 per cent of the respondents said that they supported this band of rascals opposite in their pursuit of fiscal and social policy.
It becomes clear that this government has lost the moral authority to pursue policies that are not supported by the majority of Canadians. I would hope that I am going to get a better answer tonight from the parliamentary secretary, as he licks his lips waiting to get up and give us the answer.
I want to know from the parliamentary secretary why is it that the Minister of Consumer and Corporate Affairs did not look after the interests of consumers? Second, why is it that the minister responsible for Revenue Canada, since he is sending all kinds of propaganda out saying what a great tax this bad tax is, did not tell the businesses of Canada that they did not have a legal obligation nor a right to collect this tax. Why, if it was so complicated, did the government not forego that little bit of tax that would have been paid in advance for the first two or three months of next year and protect the interests of the consumer, and, for once, protect the interests of Parliament and the parliamentary process?


Mr. Vincent Della Noce (Parliamentary Secretary to Minister of National Revenue):: Mr. Speaker, I will answer on behalf of the Minister of Revenue but not on
behalf of the Minister of Consumers and Corporate Affairs.
I would now like to give a more detailed answer to the questions asked by the hon. members for Dartmouth and Scarborough West about the requirements under the proposed GST that apply to businesses getting paid after August 1990 for goods and services to be received after December 1990.

Let me first say that, in advance of Bill C-62 receiving Royal Assent, collection of the GST for transactions straddling the transition date is strictly voluntary and is suggested as a matter of convenience for the consumers
October 30, 1990

and the businesses involved. In fact, under the legislation, the vendor will not be required to remit any GST collected until the first GST return for 1991 is due.

On August 9, 1990, the Minister issued a press release to remind businesses of the interim provisions of Bill C-62. This release stated that businesses supplying goods and services to be delivered after 1990 will be accountable, effective January 1, 1991, for the proposed 7 per cent GST on advance payments made between September 1, 1990 and January 1, 1991.
Even though the Minister was urging businesses to follow the interim regulations contained in the proposed legislation, he clearly stated that, in these cases, collecting the GST on the 1991 part of the contract was not yet mandatory.

The decision on whether to charge or pay GST on invoices issued on or after September 1, 1990, for goods or services to be delivered after 1990 is a matter for vendors and their customers to decide. However, I can appreciate that in many instances this would be the most convenient and least costly approach to take.

To conclude, Mr. Speaker, the government is continuing to emphasize that there is no legislative authority to enforce collection of the GST until the legislation is effective. At the same time, we will continue to encourage businesses to be prepared to account for the tax due on prepaid supplies.
If I have 10 seconds left, Mr. Speaker-

I will repeat the last paragraph in English for my colleague.
To conclude, Mr. Speaker, the government is continuing to emphasize that there is no legislative authority to enforce collection of the GST until the legislation is effective. At the same time, we will continue to encourage businesses to be prepared to account for the tax due on prepaid supplies. Mr. Speaker, I hope that answers my friend's questions.


IMMIGRATION
Daniel James Macdonnell Heap: Mr. Speaker, on October 17,1 pointed out to the Minister of Employment and Immigration that refugee claimants in Canada, who
Adjournment Debate
have already been hurt by their experiences that caused them to seek refuge in Canada, were studied in a survey by a team of church people, under the direction of psychiatrists, and 58 per cent were found to be in deteriorating mental health. Their mental health was worse since they came to Canada than it was when they arrived.
Why? One of the reasons is the difficulty in getting jobs. They cannot get a work permit until the first hearing, which is often delayed. Even then, it is often a limited work permit and, even then, employers say: "Well, we do not know if you are permanent here because you have not had your second hearing". There is anxiety about their futures and, worst of all, there is separation from their families. Usually husbands and fathers here are separated from their wives and children overseas.
One man came to my office two weeks ago who had been here six years. His wife died overseas, while waiting for him to bring her here. His children wrote to him and said: "You have killed our mother, now you are going to kill us. Why will you not bring us"? There is nothing he can do. This government will not let him have his case decided, and will not let him bring his family here until his case is decided. Even after his case is decided, he must wait a year for landing and then wait some time after that for the processes of immigration.
I asked the minister what steps were being taken to end this torture, this misery. All she could say was that 50 per cent of the cases have been opened in the refugee backlog. After 21 months, since the program was announced, 50 per cent have been opened. Not 50 per cent resolved, 50 per cent opened. She did not give us any indication whether they will really be able to finish it on time, a year from now, as they promised.
I asked her for an amnesty. I have never asked that of the minister before but, because of this terrible situation, I asked her to land all the people in the backlog so long as they meet the health and security standards which are required by the legislation.
There are many, many of those people who are skilled, many of them who have one of our official languages, and they are able to settle readily. Whether we consider that they were cheaters or whether we consider they were real refugees, it is time to stop torturing them and it is time to stop breaking down the immigration system by pouring staff into that useless project. Expensive staff, adjudicators, translators, lawyers, and so on are having

October 30, 1990
Adjournment Debate
their time wasted while the minister pursues that project.
The Canadian Council of Churches presented this matter in a brief to the United Nations Human Rights Committee, under article 40 of the Covenant on Civil and Political Rights. It was reported today in The Globe and Mail that the UN committee was very concerned about what Canada was doing. The council pointed out to them that Canada is now giving priority to processing claims of English-speaking applicants from the Caribbean, forcing many applicants from other countries of severe persecution to wait years before their claims are handled, and they can attempt to bring over family members.
The UN committee expressed, and I quote, "grave concerns about Canada taking people out of order, by virtue of language, and processing their applications first". An expert Toronto lawyer, Ms. Jackman said, and I quote:
-a study by the inter-church committee shows that "people become suicidal" when they are in limbo for five or six years without a determination on the outcome of their refugee application.
The brief proceeded under four articles of this covenant. One is there should be "no cruel or inhumane treatment" and "committee members suggested that these long delays to people who had already suffered trauma could be a form of cruel treatment". That is article 7. Under article 14 of the covenant, everyone shall have a "fair trial, committee members expressed concern that delays were not consistent with a fair trial and questioned the independence of the Immigration and Refugee Board".
Under article 23, protection of the family, "committee members were concerned about delays in reuniting families". Under Article 26, against discrimination, the committee members asked questions which "left no doubt that singling out English speaking Caribbean claimants was to be viewed as discrimination".
Today, the minister denied that that is being done, but I have spoken to many people in Toronto and I find that church representatives and lawyers in private practice- this government usually likes private practice rather than government. It wants to privatize everything but it attacks the lawyers in private practice if they do not kowtow to the government.-are finding that their
clients are having their cases set back if they are not from the Caribbean in order to move Caribbean cases ahead.
It is also being observed that most of those who are currently being processed are black. I ask: What is the government trying to do? Is it trying to juggle its statistics, that is, rush through these hearings and a lot of deportations? Or, is it trying to punish people who it considers cheaters en masse because of their country of origin? In so doing, it hurts real refugees whom it claims to be trying to protect. It also delays Canadians who want to sponsor their families into Canada but are delayed because the experienced immigration officers are stuck working on the backlog.
I ask that the minister consider an amnesty.


Mr. Bill Kempling (Parliamentary Secretary to Minister of Employment and Immigration):: Mr. Speaker, I would like to expand on the reply given by the hon. Minister of Employment and Immigration to the hon. member for Trinity-Spadina on October 17 of this year.
The minister rejects the notion that this process is torturing refugee claimants. Refugee claimants in Canada enjoy the protection of Canada while their claims are being determined. In fact, as Gordon Fairweather, the Chairman of the Immigration and Refugee Board has pointed out, a United Nations high commissioner for refugees has said that within the Canadian refugee determination system there may be a model for the world.
The Minister of Employment and Immigration understands the concerns of backlog claimants who are waiting for decisions. That is why steps have been taken to make that wait a productive one for claimants. Backlog claimants have had permission to work since January 12, 1989. They and their families have access to Canadian schools and social programs.
The Minister of Employment and Immigration also understands the concerns of backlog claimants who are separated from their families. That is why measures have been put in place to bring to Canada on a priority basis the dependants of backlog claimants who are facing life threatening situations or who are abused or abandoned children. In addition, as soon as a claimant has been provisionally approved for landing, the appropriate visa office is requested to initiate processing of the dependants the claimant intends to sponsor. This reduces the time required to bring those dependants to Canada.
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October 30, 1990

In addition, those claimants who know that their claims are unfounded may choose to leave voluntarily with letters of introduction to visa officials abroad. They are guaranteed an interview with Canadian officials. Their Canadian experience will be favourably considered during this interview.
When the backlog clearance program was announced on December 28, 1988, it was made clear that all claimants would be treated fairly, humanely, and on the basis of their claims to convention refugee status. The option of an amnesty was considered and rejected. In its report of the backlog clearance which was tabled in
Adjournment Debate
December 1989, the Standing Committee on Labour, Employment and Immigration supported this decision. An amnesty would be unfair to potential immigrants and to their relatives in Canada who have followed the lawful process for immigration.


The Acting Speaker (Mr. DeBlois):: 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 6.30 p.m.
[Stage Direction]
Wednesday, October 31,1990