1990-11-06

Mr. Speaker:: During Question Period on Wednesday, October 17, there was a demonstration in the gallery which occasioned a number of heated exchanges. The Chair undertook to consider carefully what had been said and to come back to the House and report if it were appropriate to do so.
On the following day, Thursday, October 18, the hon. member for Peace River, the Parliamentary Secretary to the Leader of the Government in the House of Commons, rose on a question of privilege, in his own words: -specifically to argue that certain members of the New Democratic Party participated in an action which demonstrated a clear contempt against yourself personally and this House generally.
The hon. parliamentary secretary then proceeded to charge that since the hon. member for Windsor-St. Clair knew of the demonstration, and did nothing to stop it, he was in fact an accessory to the contempt. He laid several items before the House and indicated that should the Chair conclude that this matter should be accorded privilege treatment, he was prepared to move the following motion:
That the entire matter of the demonstration held in the public gallery on Wednesday, October 17, 1990, during Question Period, and the prima facie evidence that the hon. member for Windsor- St. Clair had prior knowledge of this demonstration be referred to the Standing Committee on Privileges and Elections.

The Chair has had the opportunity to reflect at some length on this matter and has found it convenient to
organize its thoughts about three aspects of the matter. First, the disturbance itself is a prime concern and it is one which the Chair should like to pursue a little later on in these remarks, in order to focus initially on the more immediate concerns of whether there was involvement by a member or members of this House in the perpetration of this unacceptable demonstration and if so whether the conduct of an honourable member may be brought into question by means of a question privilege.

At the outset the Chair would like to make it very clear what is to be decided here. In ruling on a question of privilege the Chair does not ultimately decide upon the matter. The Chair can only decide whether, on the basis of the material presented to the House, it appears likely that there has been a breach of privilege, which is so grievous that we set aside all other business before this House to consider the alleged breach. To be more specific, in this particular instance, the Chair must be satisfied that from the evidence presented it is reasonable to conclude that the hon. member for Windsor-St. Clair had in some way participated in or aided in some manner the offensive demonstration.
The hon. parliamentary secretary has presented to this House what he described as prima facie evidence. There were, I believe, five pieces of such evidence. Perhaps it would be advantageous to consider what prima facie evidence is. Black's Law Dictionary, Fifth Edition, at page 1071 defines prima facie evidence as "evidence which suffices for the proof of a particular fact until contradicted and overcome by other evidence". Although the sufficiency of the evidence put forward was the subject of some comment during our discussion of the question of privilege, it does not appear necessary to delve further into that aspect because in any event it has been denied or explained or challenged and the Chair is of the opinion that those denials and explanations outweigh the evidence submitted which is largely circumstantial.

Speaker's Ruling
There is a time honoured tradition in this place that we accept an hon. member's word.
The hon. member for Humber-St. Barbe-Baie Verte in his intervention in this discussion described that tradition of accepting an hon. member's word "as primary and essential to the functioning of this place" and cautioned that "if we depart from that we will be in very great difficulty in this place". The Chair is indebted to the hon. member for Humber-St. Barbe-Baie Verte for that turn of phrase and for the reasoning developed in his intervention.
In response to the parliamentary secretary's accusation that he had prior knowledge of the demonstration, the hon. member for Windsor-St. Clair categorically denied that he or any member of his caucus was informed or was aware of it. He was supported in this by several members of his caucus. Even were he not, even were he to have stood alone, we in the House are bound to accept the hon. member's word-such is the nature of our institution that a member's word is paramount-and we lose sight of that at our peril.
To my mind, this aspect of the affair was concluded with the denial of the accusation by the hon. member for Windsor-St. Clair. Accordingly, I cannot find that there is any question of privilege which should be put to the House in respect of that matter.
Accordingly, it would not be appropriate to allow the parliamentary secretary to put to the House, as a privileged motion, that portion of his proposed motion that relates to the prior knowledge of the demonstration.

I should like now to turn to the demonstration itself and to a consideration of the propriety of raising that matter as a question of privilege. As I said last Thursday I listened with some comfort to representations from some members regarding the respect which we need to have for this place and which other people ought to have for it. I am pleased to accede to the suggestion of the hon. member for Saint-Denis that the Chair, at an appropriate time, remind us of what this House is all about and reinforce the seriousness of the disturbance which took place in our galleries. The hon. member for Saint-Denis, a devotee of parliamentary tradition, has a
well-developed sense of the House and its changing moods and tenors and I sincerely welcome his well-considered advice.

I also understand and share the fear expressed by the hon. Minister of State and Leader of the Government in the House that the disturbance in our galleries might be seen as a legitimate form of political dissent and is an indication of the disrespect in which the perpetrators held this institution. Those who would safeguard their rights must be ever vigilant to insidious encroachments thereupon.
In the past, the House has usually chosen to ignore those who offended its dignity by interrupting proceedings because it was reluctant to inadvertently advertise their causes. Maingot, in Parliamentary Privilege in Canada notes at page 203:
All kinds of misconduct in the presence of the House or of a committee may be treated as contempts on the ground that they part-take of an affront of the dignity of the House-
Misconduct or misbehaviour in the traditional sense would include acts that disrupt or have a tendency to disrupt or interrupt the House or committees by such acts as shouting, throwing objects, waving placards-Many instances have occurred where disorderly conduct has taken place, even to the extent of temporarily suspending the House, but the general position of the House is that the dignity of the House would be best served by taking no action in such cases-The House is reluctant to take action against those attempting to disrupt the proceedings in this way because of the attendant publicity it would provide them.
Perhaps the time has come to re-examine our practice in this regard. If so, that is for the House to decide. What the Chair must decide at this point is whether the motion put forward by the hon. parliamentary secretary, now stripped as it is of any reference to prior knowledge of the demonstration, is to be accorded privileged treatment.
Were I to decide that the question should be put to the House immediately, then the hon. parliamentary secretary would be invited to put his revised motion referring the matter of the demonstration in the galleries to the privileges and elections committee. The motion could then be debated, amended, and voted upon. Depending on the outcome of that process, it might then be considered by a committee and reappear before the House if and when the committee reported.
November 6, 1990



If the Chair appears to belabour the point, it is simply to insist upon the potential complexity and length of the process initiated by the characterization of a question of privilege as prima facie.

The Chair states clearly that it would have very little difficulty in characterizing the revised motion as privileged, yet the Chair is reluctant to unleash the consequences of that decision. At this stage I wonder if I could prevail upon the hon. parliamentary secretary to consider, in view of the deletion of part of the proposed motion, whether he wishes to proceed with this matter as a privileged item at this time.
I would ask the hon. parliamentary secretary if he would help the Chair in that regard.


Mr. Cooper:: Mr. Speaker, I have no problem at all in accepting the ruling that you have made today or the word of the hon. member for Windsor-St. Clair. It also would be my intention, as I understand it, to go ahead with the amended motion. I do not have a problem with that, if I am sure I have the right words.


Mr. Speaker:: I take it the hon. parliamentary secretary has accepted completely the words of the hon. member for Windsor-St. Clair, and that is the hon. parliamentary secretary's declaration to this House. The hon. parliamentary secretary wishes to move the motion.


Albert Glen Cooper: That the entire matter of the demonstration held in the public
gallery on Wednesday, October 17, 1990, during Question Period be
referred to the Standing Committee on Privileges and Elections.


Mr. Speaker:: The House has heard the motion. Is there agreement?


Some hon. members:: Agreed.


[Stage Direction]
Motion agreed to.
Mr. Howard McCurdy (Windsor-St. Clair):: Mr. Speaker, I appreciate that at last a judgment has been rendered by the Chair on this matter which has, according to your opinion, dissolved itself into a question of the behaviour of students, the appropriateness or otherwise of student demonstration, and a peculiar motion to send
Speaker's Ruling
the question of student demonstrations to the committee on privileges.
This is a matter that will require considerable reflection on my part to understand, in view of the statements and actions which precipitated it.
What we have with respect to this member is a decision that says that a member is to be taken at his word in the context of an allegation of contempt against this House that is based upon the unretracted deliberate statements of a member which brought forth contrived evidence to this House, and yet the only judgment is whether or not I am to have my word accepted.
It seems to me in the circumstances that we should review the nature of such charges in the mother Parliament where, if a member brings a charge of contempt against another member and which charge fails, that member is open to charges of contempt of the House himself. I would suggest to you, Sir, that the member who brought the charges to the House in the first place was far more in contempt of the House than were the students or his confreres who behaved in an atrocious way subsequent to that student demonstration.


Mr. Thacker:: Nonsense.


Howard Douglas McCurdy: The member brought a charge that was completely unsubstantiated; charges that were unsubstantiated according to his own-


An hon. member:: He should retract them.


Ms. Mitchell:: He hasn't apologized.


Mr. Speaker:: Just a moment. The hon. member may well have another occasion to continue this debate, but just so that all hon. members understand it and so that the'public that is watching understands it, the hon. parliamentary secretary made certain accusations on a question of privilege. I have found, on the basis of the absolute denial of those charges by the hon. member for Windsor-St. Clair, that there is no prima facie case to put to the House.
If the hon. member for Windsor-St. Clair wishes to debate this further at some other place, he of course can find his appropriate forum to do so. Perhaps he will want to discuss it at the committee.

Speaker's Ruling
The hon. parliamentary secretary has said that he accepts completely the word of the hon. member. He has accepted completely, as he has said, my ruling.
The hon. member for Windsor-St. Clair seems to indicate that what took place with these students is not as important as an argument that he may be having with the hon. parliamentary secretary. He can have the argument with the parliamentary secretary, but I have to tell you as your Speaker that I take very seriously these demonstrations in this place. Apart from anything else, I am in charge of the security of this entire place. While that has not been raised in the argument, I am intensely conscious of it.
The other thing I am intensely conscious of is this. It is all very well for members of the public these days to say that they have no respect for politicians. They may not have respect for some politicians, but if this country loses respect for this institution, I would like to know what it wants to substitute it with.


Some hon. members:: Hear, hear.


Mr. Speaker:: The hon. member may want to raise this matter in another way, but for now the matter is concluded. The motion stripped of the allegation against the hon. member-and properly stripped of the allegation against the hon. member-has now been accepted by the House. If the hon. member wants to raise it at another time of course we will hear him.


Mr. Nelson A. Riis (Kamloops):: Mr. Speaker, we have all listened to your thoughtful words and of course accept your decision, but I think there is something else that we have to deal with before we proceed. We are most anxious to examine the whole matter of demonstrations and what that does to the reputation of this House. That has been dealt with appropriately, Mr. Speaker, upon your recommendation.
I look now, through you, Mr. Speaker, to my hon. friend, the parliamentary secretary who made some very serious charges against the hon. member for Windsor- St. Clair. When you, Sir, indicated that you found no prima facie case of privilege, the parliamentary secretary said that he had no problem with your decision. Those were his words. He had no problem with your decision. I assume that that means he accepts the decision.
However, I appeal to my hon. friend in the best interest of this institution. In that a member's word is
paramount and having made those very serious charges against my colleague, I would ask my friend, the parliamentary secretary, to stand now and do what would be expected of the hon. member.


Albert Glen Cooper: Mr. Speaker, I am in a bit of a difficult spot. I am in this spot simply-


Margaret Anne Mitchell: You've got yourself into this.


Albert Glen Cooper: Perhaps members would hear me out and let me explain what I mean by being in a difficult spot. I have said very clearly that I do accept the Speaker's ruling. I think it is a wise ruling.
Second, I do accept the word of the hon. member for Windsor-St. Clair. Now I have a difficulty. I listened very carefully to the Speaker's ruling. I do not have the "blues" of that ruling so I am going from memory. The Speaker spoke of what prima facie evidence is. Prima facie evidence is evidence that is put forward which is believed to be true until circumstances prove it otherwise.
When I rose in the House, I rose on a case of privilege based on evidence which I believed to be prima facie. Since that time events have taken place that have been reflected in the Speaker's ruling which I accept totally and completely, including the words of the hon. member for Windsor-St. Clair. It is difficult for me to apologize for a statement I made in the House when I believed those statements to be true and then to deny them. That is the problem I have, and I cannot deny those statements that I made at the time.


Nelson Andrew Riis: Mr. Speaker, I do not want to prolong this matter. We have important work to get to, but I regret that my hon. friend has chosen this particular course of action. He knows now, upon reflection and the very learned decision you have brought to the Chamber, that his charges and accusations were false. He acknowledges that fact.
I certainly think that this would be an appropriate place for the hon. member to withdraw those remarks and apologize to my hon. colleague from Windsor-St. Clair, in the best interests of this institution. After all, we have to work together. We want to work together. However, when those charges still lie in the air in spite of your ruling, Mr. Speaker, I think it is most unfortunate for the future operations of this great institution.
November 6, 1990


Howard Douglas McCurdy: Mr. Speaker, you chose to take my comparison between the behaviour of the students and the hon. member as if it were a defence of an abuse of the House of Commons. In reviewing the history of this whole terrible incident, this is not a singular departure from the pattern of this whole debate on an issue that was not raised by me but was raised by the hon. member opposite.
I put it to you, Sir, that even while I reject absolutely that anyone should come into this Chamber and abuse you, Sir, or this House, it seems to me that there is from your very own words a higher responsibility upon members elected to this place.
It is quite a different thing to have a rabble in the gallery and then have someone, who is in this House by virtue of what is supposed to be a respect for the integrity of this place, behave in ways that are unacceptable. I would put it to you, Sir, that an elected member in that member's seat should be held far more responsible than a rabble. It is because he brought unsubstantiated, self-created, gratuitous charges that I had to defend myself and then have it measured in terms of my word. The man stood in this House and lied-


Mr. Speaker:: Now, just a moment. The hon. member has heard the judgment of the Chair which, as far as I am concerned, completely absolves the hon. member from any of the accusations, whatever they may have been, that were made. There can be no doubt about that. The hon. member and other hon. members have a chance to reflect on the exact wording of my judgment. The hon. parliamentary secretary has said he accepts that completely.
If the hon. member wishes to have the hon. parliamentary secretary say something more, there may be a procedure in which he can raise it, but the Chair cannot order the hon. parliamentary secretary to do more at the moment than he has done.
The parliamentary secretary has said that when he made those accusations, however unfounded they may have turned out to be, he did not do it dishonestly. The hon. member for Windsor-St. Clair now says that he lied. That is a very serious allegation and, if the hon. member for Windsor-St. Clair wants to pursue it, he will have to pursue it according to the rules and at another time.
Routine Proceedings
The essence of this was that there was a demonstration, which in my view, prima facie, is a contempt of this House. It was an argument about who might have known about it and who might have prevented it. That argument, while of course serious, and especially serious to the hon. member for Windsor-St. Clair, and I understand that, is important and I am not diminishing the importance of it. I do not think the argument at the moment should take precedence over the fact that these kinds of demonstrations which some people in this countiy think are perfectly legitimate, are absolutely not legitimate. That is the fundamental point that has to be made..
Perhaps the hon. member and the parliamentary secretary would discuss their differences. If they wish to rise later on today I would be pleased to hear them. That might well be a more satisfactory solution than the hon. member for Windsor-St. Clair says has evolved so far. I fully understand the position of the hon. member for Windsor-St. Clair.
I would ask hon. members not to confuse the two issues. There is a paramount issue here and that is whether this place is going to be invaded by people, no matter how sincere their beliefs or otherwise who are going to act in contempt of it and disrupt it. I do not have to remind members who have a sense of history of what that did to a countiy that we now consider our friend and ally.



ROUTINE PROCEEDINGS


Albert Glen Cooper: Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table in both official languages, the government's response to 36 petitions.
[Editor's Note: See today's Votes and Proceedings.]

Routine Proceedings


PRIVILEGES AND ELECTIONS
Mr. Peter Milliken (Kingston and the Islands):: Mr. Speaker, I have the honour to present the Eighteenth Report of the Standing Committee on Privileges and Elections concerning Private Members' Business.
[Editor's Note: See today's Votes and Proceedings.]


PETITIONS
Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, it is my duty to present to the House a petition signed by 25 Canadian citizens who wish to express their objections to the goods and services tax, especially as it applies to books and magazines.
Mr. Speaker, your petitioners maintain that free distribution of printed matter constitutes the cornerstone of our democracy, our culture and our educational system. Your petitioners claim that an educated and productive society will suffer as a result of this tax.
Your petitioners humbly pray and call upon Parliament to re-emphasize the underlying principles of exempting printed matter and to provide for such exemption in the GST bill and regulations.
Mr. Speaker, these people are right. The government should listen and realize that taxing publications means putting a tax on reading.


Mr. Bob Speller (Haldimand-Norfolk):: Mr. Speaker, it is my pleasure, pursuant to Standing Order 36, to present the first of a number of petitions that were signed by people at the Norfolk County Fair.
These petitioners are asking and calling upon this government to reject the goods and services tax.
This petition has been certified by the clerk of petitions.


Mr. Joe Fontana (London East):: Mr. Speaker, it is my duty, pursuant to Standing Order 36, to present a petition to Parliament from hundreds of petitioners from
across the country, including Montreal, Mississauga, and Ottawa, pleading with this government to reaffirm the historic principles embodied in the tax-free status of the printed word by retaining the zero rate in the GST legislation and regulations.
In other words, do not tax books and do not tax education, so that our young people can, in fact, learn to read and contribute to our society. Imposing the GST on books and reading material will not do that.


Nelson Andrew Riis: Mr. Speaker, it is my honour to present a petition, pursuant to Standing Order 36, on behalf of a number of constituents from Kamloops.
The petitioners point out that the government plans to tax religious reading materials, that is, periodicals and books of a religious nature. This would make Canada the only country in the world that taxes religious books. These petitioners are asking that the government stop taxing religious literature of all kinds, by repealing the goods and services tax.
Mr. Speaker, I have a more general petition, on another matter, again from petitioners from Kamloops, British Columbia, who are concerned in regard to the government's continued decision to go ahead with the goods and services tax.
The petitioners point out that with winter coming on, the additional tax on home heating fuels will add a serious burden to northerners, which means Canadians, generally, with the exception I suppose, of the greater Vancouver area. The fact that we all have to buy more heating fuel will mean more money being paid out through the GST and this is an unfair burden. These petitioners ask the government to simply drop the GST.


Ms. Joy Langan (Mission-Coquitlam):: Mr. Speaker, I rise under Standing Order 36, to present a number of petitions regarding taxes.
The first petition is from workers in the area of Mission-Coquitlam who have found that the tax burden on average families is roughly $1,000 greater now than it was in 1984. They call on the government to establish a minimum tax on profitable corporations and to ensure that the burden of tax is more fairly spread among individual and corporate taxpayers.
November 6, 1990


Joy Langan: Mr. Speaker, the other petitions concern women and seniors in poverty.
As you know, Mr. Speaker, 50 per cent of Canadian women who file tax returns have incomes of $10,000 or less, compared to only 23 per cent of Canadian men.
The petitioners, in this instance, call upon the government to provide and introduce a tax system that is simpler and fairer for average Canadians, particularly for those who are poor and particularly for senior women. Mr. Speaker, I have another petition with regard to seniors in poverty. Based on the fact that 60 per cent of women age 65 and older live below the poverty line, the petitioners call upon this government to introduce reforms to our public pension system which will ensure that all women, whether or not they are in the paid labour force, receive pensions which allow them to live with dignity and allow them to participate fully in society.


Mr. Jerry Pickard (Essex-Kent):: Mr. Speaker, I rise, pursuant to Standing Order 36, with a petition from those who are very much opposed to the taxing of reading materials. Taxing reading materials causes a great problem for Canadian publishers who are in competition with others. We well know that that type of competition is not positive for Canada, nor is it positive for those who wish to receive printed material. It seems to me to be a burden which we have always tried to bring a tax-free relationship to.
In this case, the goods and services tax, I believe, will be very, very negative to education, to programs that we have in this country, and to the dissemination of information.


Margaret Anne Mitchell: Mr. Speaker, I also want to rise under Standing Order 36 to present an important petition from quite a number of smaller towns in southern Ontario such as Brantford, Hamilton, Sim-coe, Thorold, et cetera. These Canadian citizens state that the government must remove the goods and services tax. They say that we need an effective tax system with a minimum tax on wealthy individuals and corporations, and that we need broad consensus on a sales tax measure that would be effective to replace the manufacturers'
Routine Proceedings
sales tax but we do not need or do not want the goods and services tax. The petitioners call on the government to remove this plan for the goods and services tax and institute a progressive form of taxation.


Mr. Tom Wappel (Scarborough West):: Mr. Speaker, it is my pleasure and duty to rise today to present two petitions certified correct as to form and content, both of which are signed by citizens living in the Ottawa area.
Both petitions deal with the goods and services tax. They zero in on a specific problem, and I use the word "zero" advisedly, because they zero in on the fact that books have never been taxed. They have always been taxed at what is called a zero rate for magazines, books and newspapers. Now under the proposed GST, for the first time, the government is proposing to tax these otherwise never before taxed items.
Therefore, these Canadian citizens ask Parliament to ensure that we respect the historic principle of never having taxed books, magazines and literature before and ensure that the GST legislation does not do so.


Peter Andrew Stewart Milliken: Mr. Speaker, I have the honour to present a petition signed by several voters here in Ottawa who are opposed to the GST. These Canadians are particularly concerned about the government's proposal to apply this tax to printed matter and to books which are so important in a democratic society.

These petitioners, like so many others, are appalled at the government proceeding with this tax when so many millions of Canadians have indicated their opposition to it, and they have signed this petition joining those other Canadians.


Peter Andrew Stewart Milliken: The
second petition is on another subject matter. It was signed by a number of electors in Kingston and the Islands, and in the surrounding area represented in this House by the hon. member for Hastings-Frontenac- Lennox and Addington. He is supporting a government which is proposing to sell out Canada's system for

November 6, 1990
Routine Proceedings
distribution and provision for poultry and dairy farmers in this country.
This petition calls upon Parliament to instruct the Government of Canada to keep the Canadian supply management system intact and to protect it in its entirety at all costs in the current GATT negotiations and not to sell this country down the drain, as it has been doing for the last six years to the great detriment of Canadians in a way that has hurt our economy. It has sold out our country to our neighbours, which is a deliberate attempt to attack our supply management systems which have been so effective for the benefit of Canadian farmers.
These people have signed this petition hoping that the government will listen to their concerns and protect the Canadian farmers instead of selling them down the drain as they have been doing for the last six years.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Albert Glen Cooper: Mr. Speaker, the following questions will be answered today: Nos. 351 and 391.


Mr. Taylor: For the years 1989 and 1990, were there any follow-up enquiries regarding the Northern and Remote Ihx Allowance in Saskatchewan and if so (a) what were the numbers (b) how many claims were reviewed (c) how many claims were adjusted?


Hon. Otto John Jelinek (Minister of National Revenue):: a) The number of claims made regarding the Northern Residents Deduction by individuals residing in Saskatchewan on 1987, 1988 and 1989 income tax returns are as follows:
1987	1988	198914,393	13,375	13,016
b)c) Information on the number of claims reviewed and adjusted for residents of the Province of Saskatchewan is not readily available. For administrative purposes, this data is maintained in summary form which also includes data for the Provinces of Alberta and Manitoba.
Taxation year	1987	1988	1989Claims reviewed:	7,679	5,083	0Claims adjusted:	4,614	2,585	0


Mr. Funk: In (a) 1988 (b) 1989 in Saskatchewan, were there any follow-up inquiries regarding the Northern and Remote Tkx Allowance and, if so, what number?


Otto John Jelinek: a) b) Information on the number of claims reviewed and adjusted for residents of the Province of Saskatchewan is not readily available. For administrative purposes, this data is maintained in summary form which also includes data for the Provinces of Alberta and Manitoba.
Taxation year	1987	1988	1989Claims reviewed:	7,679	5,083	0Claims adjusted:	4,614	2,585	0


Albert Glen Cooper: Mr. Speaker, would you be so kind as to call Starred Question No. 342.
Mr. Speaker, due to the length of this response, I ask that it be printed in Hansard as if read.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House to accept the parliamentary secretary's suggestion?
Some .hon. members: Agreed.


[Stage Direction]
*
Mr. Saint-Julien: Has the Canada Post Corporation installed any supermailboxes more than 600 feet away from the customer who lives the furthest distance from the supermailbox in the area served and, if so (a) in which provinces (b) in which cities and towns (c) how much further away than the standard 600 feet are these supermailboxes located?
November 6, 1990


Hon. Harvie Andre (Minister of State and Leader of the Government in the House of Commons):: In 1985, Canada Post Corporation developed and announced its delivery policy including the use of community mail boxes (super mailboxes) as the equipment and mode of delivery that would be used in situations that would previously have gone to door to door delivery. The distance between customers served by the community mailbox and the equipment was established at 600 feet or 180 meters. Generally, this practice has been implemented for the largest majority of the 600,000 customers who are on the service as of 1990/91.
There are, however, circumstances where the Corporation cannot stay within the criteria due to the layout of the subdivision or municipality. In these cases, if Canada Post stayed with the criteria it would result in the boxes being placed where they were in full frontal view of several homes on the same side of the street. In these circumstances Canada Post has moved the boxes to the ends of crescents or some distance away to a place where it could find a piece of property that would accommodate the box on easement without imposing on the homeowners adjacent to the equipment. There have been other circumstance where Canada Post has been petitioned by customers to move the boxes to another location and who agreed that they didn't mind walking the extra distance.
In other circumstances Canada Post has taken the initiative and surveyed its customers. In still other circumstances municipalities have asked the Corporation to place the boxes in certain situations which exceeded the 600 foot criteria and Canada Post has solicited and received the support of the customers involved. In urban centers where the Corporation has put such exceptions into service, generally, the customers don't have to walk any more than an additional 300 feet to their community mailbox. In all cases, the Corporation has entered into discussions with the municipal representatives of those serviced by the community mailboxes.
Where Canada Post has placed community mailboxes in cluster sites in suburban and rural settings, in most cases, a portion of the customers reside more than 600 feet from the equipment and therefore have to travel greater distance.
These exceptions have occurred in a number of cities and towns from coast to coast, in most provinces. Canada
Government Orders
Post has endeavored to consistently apply the criteria. However, the Corporation has had to remain flexible in situations where it served the municipality, its customers or its approach to installation in a more practical fashion than sticking rigidly to the standard.


Albert Glen Cooper: I ask that the remaining questions be allowed to stand.


The Acting Speaker (Mr. DeBlois):: Shall the remaining questions be allowed to stand?


Some hon. members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed from Tbesday, October 30, 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. Joseph Volpe (Eglinton-Lawrence):: Mr. Speaker, I listened attentively as the minister presented his bill for second reading and then I read over many of his documents and his speech again to be convinced, if I could, on behalf of all Canadians that the initiative was a good one. I must confess that, upon such reflection, I remain as unconvinced as earlier regarding both the intent of Bill C-83, whom it shall benefit, as well as how it should benefit those and the objectives. In fact there are more questions that remain unanswered than those that are answered with this bill.
For example, for whom is this bill designed? Who is going to benefit? Is it going to be the customers through an equality of service, availability of service, accessibility of service, consistency and variety of service, security of deposits, or security of services? None of these questions are addressed.
Are we, in fact, designing Bill C-83 to assist depositors and investors, the clients? Are deposits going to be guaranteed, not only by the law under regulations, but by

November 6, 1990
Government Orders
the practices of the financial sector? In fact, are we going to provide the appropriate protection against excessive leveraging that will occur as a result of cross-pillar affairs?
Are there going to be the appropriate defences against self-dealing, for example, investment decisions based on what is required by a partner or an affiliate in what currently would be another pillar or segment of the investment market?
The minister, in fairness, has given us all kinds of assurances. But those assurances last not a whit longer than the failure to put into the legislation a monitoring and an enforcement mechanism that would ensure that the claims of the minister are actually going to be carried out. Prior to this legislation, regulation was sometimes seen to be difficult when the four pillars of the investment industry were regulated on an individual basis. We would have some sense of certainty about both security of investments for depositors, the type of investments that were going to be engaged in, and, as well, the question of competition in each compartment of the financial sectors. Those kinds of rather weak defences are even blurred further.
The third question one might ask is: are we putting into effect Bill C-83 because we want to enhance the viability and competitiveness of the financial organizations? Does Bill C-83, in fact, make them more competitive? Does it provide an opportunity for each of the 3,000 such financial organizations in the country to emerge as a much more viable, competitive, aggressive institution, available for the service growth of consumers and investors?
I am not sure it is there, Mr. Speaker. There has been much to do and much said in debate about enlarging the abilities of all elements of the financial sector to address the marketplace of today, on both a global and domestic scale.
But that ignores the fact that in 1981 the Royal Bank of Canada, which is the largest of Canadian banks, ranked 16th in the world in terms of its import and size. Today, a mere nine years later, it is reduced down to 57th place. With the kind of resources available to the Royal Bank a mere nine years ago, what has changed? I have not heard an answer from the minister or from debaters
in the House. What has changed to diminish the ability of the Royal Bank to compete when it already assumed a position of pre-eminence on the world market?


Mr. Sobeski:: How many U.S. banks are in the top 10?


Giuseppe (Joseph) Volpe: all well and good, provided that we could see some of those results today.
I do not need to point out that our balance of trade has been steadily declining. While it is true that we can get more foreign investors into the country, it is not always certain that the profits of that investment stay in the country.
There are some problems that need to be addressed with Bill C-83. I hope that these problems will be addressed diligently and thoroughly in committee. The Canadian public wants to know exactly the direction in which we are going.
One of the items that needs to be addressed, for example, despite political philosophy, is the question of concentration of wealth and economic control in the country. It is a serious problem. We have noted, and the minister has acknowledged in the House, the 3,000 financial institutions which he says have an asset base of some $900 billion. A mere 25 of those 3,000 control some 84 per cent of all those assets. That is $760 billion. That kind of concentration of economic and investment control cannot help Canadians. It cannot possibly be working to the advantage of all Canadians, both at the consumer level and the investment level.
Let us take that one step further. Aside from having this $900 billion asset base concentrated in the hands of some 25 companies, we note as well the assets of banking institutions in Canada relative to the GNP have jumped some 50 per cent over the last three decades. For example, in the middle of the 1980s the banking institutions had effectively 90 per cent of assets relative to GNP. In the 1970s, that ratio was only at 60 per cent. In the early 1960s, it was only at 41 per cent. We can see a trend that is only going to be accelerated further by a bill such as Bill C-83, unless the appropriate safeguards are put in place.
The concentration that is coming from within the industry is not going to assist the little guy, so to speak. It is not going to do a heck of a lot of good for the balance of those 3,000 financial institutions that operate in the domestic market. In fact, it is admitted by the minister, as well as critics and observers-those who are for the bill and those who speak vehemently against it-that, as a result of Bill C-83, we are likely to see situations that
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result directly from the proposed financial restructuring. Banks will buy into insurance companies. Trust companies will evolve into full-fledged banks. Insurance companies will expand into trust company activities and, possibly, domestic banks will also buy into trust companies. Everybody has acknowledged this, but not everybody sees an inherent danger.
We are slowly eroding the possibility of the small banking institution, the private and small entrepreneur, from not only conducting a worth-while enterprise but from flourishing and developing. In fact, one of the things we ought to appreciate in the course of the debate is that the federally chartered banks are already by far the major sources of Canadian financial capital. These banks, as a result of Bill C-83, could eventually expand their domination through diversification within the Canadian financial sector.
The likelihood of Canadian domestic banks buying into insurance companies is reinforced by the experience that we have seen elsewhere, most particularly in Europe. There, they acquire insurance companies because, quite frankly, they want to pool the information data about clients. They want to expand their product range and protect themselves against hostile bids. But, in all cases, all of this is going to the detriment of and at the expense of bank deposits and depositors.
We are not addressing the question of concentration of financial and economic clout as a result of Bill C-83. This raises a series of doubts. I see some of the members who have participated in the debate so far and who have spoken very fervently about some of these doubts. In fact, the discussion should be about whether we are focusing on the right international market, whether or not we are talking about the appropriate assumptions for restructuring that will make us more competitive internationally, and whether or not we are focusing on an international market correctly.
The so-called Chinese walls have existed, in the opinion of some, essentially to limit the potential of the economies of scale. The removal of these Chinese walls would allow the conglomerates that emerge-because they are going to be conglomerates that emerge-to continue to benefit from an increased market with better power and greater risk and diversification.

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Again, in the opinion of some-for example, Guy Glorieux, the Director of Financial Services Research Program of the Conference Board of Canada-this could prove to be a decisive factor in strengthening the competitive positions over time, with the focus on over time. There is an element of expectation, hope and optimism in that. But, it would be of great interest to those involved in financial sectors to note that there is a counter position. It states that perhaps the international environment is not, in fact, truly market driven, and there should be concern for the restructuring for the wrong reasons. One estimate, in fact, points to only 20 per cent of foreign exchange related transactions linked to any real exchange of goods or services. The balance of 80 per cent relates to speculation and arbitration.
Under those circumstances, we should be very concerned about the belief that deregulation of financial markets will enhance the efficiency in the real economy, because these appear to be based more on pointing to the fact that others are doing the same thing, than on hard facts or demonstrable evidence, both of which may be lacking.
The international environment is vulnerable and, in the opinion of many, dangerously unstable. That condition has forced the IMF in a report dated 1989 to state that "the speed with which the disturbance has spread and the breakdown of geographic and functional barriers that potentially insulates markets are now leading to supervisory authorities in a number of countries to reassess the adequacy of prudential arrangements, both nationally and internationally."
In fact, one example of reassessment and re-evaluation of the direction for the financial industry is the risk involved in international environment. It is to be seen in the international security's business.
America's Citicorp spent, as an example, $1 billion building up its world-wide equity trading operation. Yet earlier this year it closed down the last part of this operation.
Another example: Normura Securities, Shearson Le-haman Hutton and Merrill Lynch all have scaled back
their world-wide equities operations and that is as of this
year.
What are we doing? With this bill, we are essentially acknowledging that we should be entering into a sphere that others are in rather warily. In my view, it is inappropriate to think in terms of an American market when we are talking, or at least giving an argumentation for the validity of a bill in an international scene.
In fact, more than one-third of Royal Bank's total loans are to American borrowers. One-quarter for the Bank of Montreal's total loans are again to American borrowers. So the propensity of Canadian lending institutions to be involved in an American market is there by virtue of the tradition of their business.
The international competition is a focus of the Canadian financial institutions and is more likely to be directed toward the United States, and not to Europe or Japan-that is to say the international scope-particularly given the Canadian banks' reluctance to invest in and a lack of activity in Europe over the last several years.
The financial restructuring that we are trying to accomplish with Bill C-83 is going to be more sensitive to the events that develop in the United States than on the international scene. The irony of all of this, Mr. Speaker, is that while we are moving into deregulation at a very quick pace, we are doing so at a pace that is much more accelerated than the one in the United States.
The present laws in the United States, as you will know, and other members as well, do apply to foreign financial institutions operating in the United States. The current laws are that banks cannot own securities firms and banks cannot own more than 10 per cent of commercial businesses, even though, of course, those banks are working their way around both of those regulations. The fact of the matter is that the regulations still do exist.
Canadian institutions wanting to operate in the United States are governed by such legislation. The irony here is that while we are taking the risk of initiating financial reforms to expand into the United States, it is not going to produce great fruit for us in the short run.
The financial changes to the institutions that we are proposing are going to make this market much more ripe for American involvement. The concern about the problem that the securities industry is having in competing in

the United States is due to the fact that Canadian banks now own the major Canadian securities firms.
The vulnerability that I mentioned earlier is further enhanced by the understanding that Canadian reliance on foreign market borrowing, which was $24 billion in 1986 in American dollars, is relatively higher than all other major industrialized countries.
For example, ours stood at 4 per cent of GDP, as compared to 3 per cent in the United States and even less for others. Canadian issuers raised about $25 billion in Euro markets between 1987 and 1989, double that raised in the United States during the same period. But there is a recent shift to the United States as a result of the FTA and widening of the interest rates.
We have a serious problem in terms of the context in which we are creating legislation that we hope will take us into global competition, but which in fact is drawing us further and further into the American marketplace. The long term implications for the implementation of a universal banking strategy do cause some great concerns with respect not only to our position vis-a-vis the United States and other nations in the global market, but also with respect to who in this country is going to take the lead in terms of financial restructure. We have seen some initiatives by provinces like Ontario and Quebec that call into question the whole business of federal-provincial relations and federal jurisdiction.
The European examples where we have bank ownership of industries might be common in many countries such as Germany, but there is a significant cultural and historical factor which is not accepted and is not verified here in Canada. I know the clock cannot be turned back but I do not think that we should act precipitously in this regard. What we want to do with Bill C-83 is ensure that it receives the appropriate study and the appropriate public scrutiny required in order to safeguard the interests of Canadians, that is depositors and investors.


Nelson Andrew Riis: Mr. Speaker, I listened with interest to my hon. colleague's comments. I must say that I share a number of the concerns that he has raised. I would like to add for myself, on behalf of the New Democratic Party, some of our concerns and then make some specific references to the legislation before us this morning.
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Let me begin by saying that when Bill C-83 is discussed, and we are talking primarily about the trust and loan companies act, it must be seen in the context of deregulation of all financial institutions. After all, this is simply one of the packages that will be considered by the Parliament of Canada as the government moves into deregulating the financial institutions of the country.
There is a certain ring to that word, deregulation. The ring it usually implies is getting rid of red tape, laws, regulations, guidelines and so on. It is more of a turning over to the free market the whole matter of financial institutions and their operations. The implication is that that will encourage competition between financial institutions and the banks will get into the trust business and the savings organizations will get into some of the banking functions and some of the investment operations, insurance companies and brokerage activities. This sounds as though additional competition will mean a decrease, if you like, in the charges and the premiums paid, and a better deal for consumers generally. That is the theory.
Let us look at the theory in a double context, the first being the airline industry. Those were the same arguments presented to us with the deregulation of the airline industry and, as a matter of fact, the entire transportation sector. When the government brought in this initiative, first started by the Liberals, I believe, and then with the end of their administration and the beginning of the Conservative government, deregulation of the entire transportation sector began. The argument is that we were the same and this would result in benefits to the consumer, increased and improved services and benefits of all kinds. Costs would also come down and the consumers would benefit. Woefully, that has not occurred. As a matter of fact, the opposite is unfolding. We are seeing a concentration of power and a concentration of influence in the transportation sector.
We had a number of airlines, such as Pacific Western, Wardair, Canadian, Air Canada and a whole collection of regional carriers. Now, in the airline industry, we are down primarily to Canadian and Air Canada. I suspect if one reads all of the air transportation literature, almost everyone is agreeing that this will continue and eventually we will have one airline in the country. It need not be Air Canada or Canadian. It might be Delta or United

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Airlines that will have taken over the existing Canadian structure.
In places like Kamloops, that I have the honour to represent in the House of Commons, we were told that there would be all kinds of additional services.
If we felt we had good service with Pacific Western providing that service, just wait until deregulation. Then we will have all sorts of additional services.
We have now what we call riding on a lawn dart, these little tiny airplanes, where the pilot gets in and welcomes you on board, Mr. Speaker. You sit in there and you bump your way over the Rockies to Calgary. This is improvement over the jet service we used to have to Calgary.
We had a whole set of times that we could choose in the old days. Now, Mr. Speaker, you have to really plan your itinerary to get to Kamloops in a day. In other words, the service is worse.
We were told that the price would come down, that additional competition results in price savings for the consumer. For a few weeks, it actually occurred. You actually had a good deal in terms of air transportation.
Now, to fly from Kamloops to Calgary and return is not much more than flying Kamloops to London, England and return. People say: "Maybe we should do our Christmas shopping in Europe." The whole promise that was held out to the consumers has just evaporated. That whole matter of the people of Canada benefiting obviously from deregulation in the transportation sector, of course as we know, has just been appalling.
I could talk about rail transportation. Of course, whole communities have simply been abandoned in terms of the traditional service by rail. I think we all recognize now that it was a serious mistake. I think at least some of the government is acknowledging that fact. Not everybody. That is the transportation industry.
When we talk about deregulation and look at transportation as an example of what deregulation does for the people of Canada, we see it does virtually nothing. As a matter of fact, it makes things worse. Some people benefit. The large players in the transportation field, particularly the multinationals, will benefit.
The American trucking lines have benefited. My guess is in the future the American airlines will benefit by the open skies policy of having access to Canada, and on and on. In other words, there are beneficiaries, and they tend to be the very largest players in that particular sector.
Let us look at another example, what deregulation may do. We do not have to look very far. We can look down to the S and Ls in the United States, savings and loans, where the American government and the Reagan administration as part of the Reaganomics decided for perhaps not even questionable reasons to apply to the country to deregulate its financial institutions.
The S and Ls are an absolute disaster. People have lost their entire savings, and they are just going down like flies, one after the other. I do not think I have to explain to the members of the House who read even marginally in the area of finance that the S and Ls in the United States have been an absolute and total disaster for the people involved.
Some people have made fortunes. They make their fortunes and then get out before the savings and loans institution collapses. The average person, the ordinary American citizen, who puts his or her life savings into those institutions loses virtually everything.
Maybe we do not even have to look further in our own country to recognize that we are under pressure these days. We have seen a number of trust companies fold. We saw the total disaster of the banks folding in western Canada and the losses that accrued there to so many people and the bail-out, of course, that certain sectors received in terms of the depositors.
We have to see that while we discuss Bill C-83. Bill C-83 was first introduced in the House in September by the Minister of State for Finance. At that time, he provided us with the purpose of the bill. That is the point, at first reading.
I want to read this into the record because I am convinced without any doubt at all that eventually the government will pass Bill C-83. It will deregulate the industry. It will fold up the four pillars on which the Canadian financial community has been built.
I would like to say with some pride that Canada has been recognized around the world as having sound

financial institutions that are reasonably well regulated. It is a system that is the envy of many countries.
Now the government is in this sort of pell-mell ideological move to dismantle the four strong pillars of our system to make it easier for them to operate. We have to recognize that when we say "them", we mean the large players. Surely we will see the erosion of the small financial players that are in the system now and a welcoming of foreign players into Canada more than we have now to take over, using their financial muscle to displace Canadian firms in the financial institution market.
I think that is unfair. It is unfortunate. I know from going around and talking to some of the small insurance operations in Kamloops that they just shake their heads in disbelief that this government would be so callous in abandoning their efforts over the years to build up small, regionally or in some cases community sensitive insurance operations, to turn over in a sense now the operation to large financial multinationals, probably banks or trust companies, to get into the insurance area. I just use that as an example of where we are moving.
The minister back in September had this to say about the purpose of the bill. It was to consolidate the current trust and loan companies acts and to revise extensively the way in which federally incorporated trust and loan companies are regulated. That is laudable. The Trust Companies Act and the Loan Companies Act were enacted in 1914 and that Bill C-83 was the first attempt to modernize them. Because of the essential similarity of trust and loan companies, at least in that area of their business, their financial intermediary activities, Bill C-83 consolidates them.
We have been in favour of this updating of the legislation for years. I remember 10 years ago making a case to the Minister of Finance at that time, saying that it was time we brought this legislation up to speed. After all, the world has changed so much since 1914, particularly in the area of financial institutions, but for years and years the government dragged its feet.
One of the reasons I think it dragged its feet was because of the heavy lobbying that it received by some of the larger institutions saying: "We want to deregulate. We want to expand our operations". If I remember, the
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banks wanted to get into car leasing operations. They want to just get their tentacles out, as widely spread as possible. This was going against a lot of the ideas that the government had at that time.


Mr. Rodriguez:: That is what they want.


Patrick (Pat) Anthony Sobeski: The banks didn't get into car leasing yet.


John R. Rodriguez: They got other things.


Nelson Andrew Riis: Mr. Speaker, my friend across the way said: "The banks didn't get into leasing yet". You wait; it is a bit like Sunday shopping, Mr. Speaker. They just keep grinding away until eventually they wear them down and Sunday shopping becomes a reality.
Eventually the banks will be into the leasing operation, Mr. Speaker; just wait and see. It might take a year or two. After all, we have not started the revisions to the Bank Act yet. They will be coming shortly as part of the comprehensive package. Then we will see.


John R. Rodriguez: Twenty tonnes and over they lease.


Nelson Andrew Riis: That is right. After all, right now they are into partial leasing, 20 tonnes and over.


John R. Rodriguez: So it is coming down.


Nelson Andrew Riis: It is coming down. It will get down to 19 tonnes, 18 tonnes, and eventually down to the Toyotas and so on.
Let me move on with some of this important information. Another purpose of the bill as articulated was: "In the role of financial institutions, trust and loan companies are virtually indistinguishable". I think we appreciate that. It is obvious that when we study these two institutions and the way they have evolved into modem times, they in fact are indistinguishable.
They both operate in the retail deposit and lending markets by raising the bulk of their funds through customer deposits or through the sale of various debt instruments to the public and investing in residential mortgages. We have had some concerns about this point. I know my hon. friend has indicated time and time again that while these two types of firms are indistinguishable now, the question is: Ought they be? What does this mean in terms of their movement into the deposit taking market as they compete with the other financial institutions?

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Again, because of the lack of any updated legislation, little has been done even in terms of talking about this publicly. I must say that the may difference between the trust and loan companies is that the former, in addition to their financial intermediary role, act as administrators of estates and trusts and as agents on behalf of customers in the management of their financial affairs. The estate, trust and agency business of trust companies however being a matter of property and civil rights is regulated by the provinces.
Bill C-83 is the first of a series of proposed statutes designed to reform the regulation of federally incorporated financial institutions. Perhaps it is worth making a note here, as this debate begins on this most important piece of legislation, that the regulation of financial institutions is a shared federal-provincial responsibility in the country. The federal government has exclusive jurisdiction over banks, while the provinces have exclusive jurisdiction to regulate security firms. Trust, mortgage, loan and insurance companies are regulated by both provincial and federal regulators.
It has been somewhat embarrassing to the government. While it has been dilly-dallying and not proceeding to deal with the changing world of financial institutions, its provincial counterparts have in fact been moving. Some of them, particularly the province of Quebec, have moved very expeditiously to loosen up the four pillars, in a sense undermining any leadership the federal government might have provided, because they have waited so long. Now it is really a catch-up business to bring federal regulators, federal legislation and so on up to speed with what has already happened in many of the provinces.
There are a number of purposes in Bill C-83. One is to benefit consumers by increasing competition and the variety of services offered by financial institutions. I think we have an obvious mixed purpose here benefiting consumers by increased competition. It is fair to say that in reality, when we look at how this has been operating in the United States and in other sectors, this increased competition just does not occur. It will occur momentarily, perhaps for a short period of time in certain sectors of the financial community, but by and large the large
operators, particularly those that are multinationally based, will eventually take precedence.
The variety of services offered will be a reality. Now trust and loan companies will be able to offer more services. Banks will offer more services. Brokerage houses will be offering more services. Insurance companies will broaden their base. Indeed there will be a broadening of services.
However, this raises a whole set of other concerns. Mr. Speaker, you probably remember the debates and the discussions when this was first being studied by the finance committee some years ago, the whole matter of arm's length operations and the need to have almost increased regulation when the various pillars are allowed to diversify their operations. After all, it is going to be very tempting to a bank operation to sort of be a one-stop shopping centre and, rather than encourage competition, to lay out a whole package-the mortgage, the insurance, and so on down the line-all in this one set of offices along a corridor.
Whether that increases competition is open to some question. As a matter of fact, if one were to be cynical I suppose one could even make the case that that would allow for manipulation against competition to take advantage of the naive customer or the customer who fails to understand the complexities of the financial community. However, we will wait and see and discuss more of this in committee.
This will also enhance protection for depositors and policy holders. The whole matter of policy holders is open to some question now in terms of protection for policy holders, but we will be raising this matter in committee in terms of some of the concerns we have and how this can be regulated to provide that additional protection.
The legislation will strengthen the ability of Canadian financial institutions to compete at home and abroad. It will lay the groundwork for discussion with the provinces on harmonization. Of course this harmonization aspect has to occur. I indicated earlier that the provinces got a bit of a jump on the federal government in this case by moving to take advantage, I suppose from their perspective, of changing financial times and by looking around the world. It is a bit embarrassing now for the federal government to be playing catch-up ball in this aspect, but obviously harmonization has to be a goal.
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Mr. Speaker, you signal that my speech is coming to an end unfortunately, as there is so much more to say.


John R. Rodriguez: Tell us about the American banks coming in.


Nelson Andrew Riis: In the last moments I have, I will mention the involvement of United States banks in Canada and the old Schedule IIs that we welcomed some time back with very strict regulations. The understanding was that as a quid pro quo for our banks operating in their country and part of the changes going on, we would allow American banks to come into Canada and play a certain role in the banking business. That is all gone now. It is in a sense holus-bolus. The landscape is open to American financial institutions, and the American banking institutions in Canada will become more of a reality than ever. That is one thing.
I could talk about the capital structure, particularly those reflected in clauses 62 to 138. I think that is important. Of course other speakers will be referring to it. The whole matter of corporate governance is something we have spent a lot of time discussing. We have to spend a lot of time establishing the roles of governing the composition and the election of the board of directors as set out in terms of its rights and responsibilities.
There is ownership; the matter of self-dealing, which I referred to rather implicitly earlier; the use of cease and desist orders; and assuming control of the institution. Basically I can just summarize by saying that the 1986 blue paper announced that a financial institutions restructuring program was to be launched. This provision allowed that where a regulated financial institution was threatened with insolvency, the government would have the authority to vest all the capital of the institution with the CDIC. In such case, CDIC would have full powers to manage the affairs of the institution and to effect a merger or sale of assets if deemed appropriate.
Naturally, in conclusion, that whole area was a major concern to us in the New Democratic Party and continues to be, I might add. It is something that we would want to pursue once the matter moves to committee.


Peter Andrew Stewart Milliken: Mr. Speaker, I enjoyed listening to the speech of the hon. member for Kamloops. I know that he is one of the principal spokesmen on many issues and knows quite a
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lot about the Bank Act and the structure of banking and finance in Canada. That was obvious from his remarks.
One of the things I did not hear in his speech, which I expected to hear, was an enunciation of NDP policy on the nationalization of banks. I understand this has been a cornerstone of NDP policies since the thirties. I had hoped he would illumine the House on his party's current position in respect of the banks.
I am surprised that he talks of this legislation in reasonably favourable terms when I understood-and perhaps I am mistaken-that the aim of the NDP was not to regulate. It was to take over Canada's banks and run them as instruments of the state.
I did not hear that today. Perhaps, like their policy on the Senate, they have had a change of heart. If that is so, I wonder if the hon. member could illumine the House, tell us the latest policy resolution in respect of nationalization of banks, and tell us if it has been excised from the NDP policy manual. Perhaps he was there, if it was so excised, at the convention where this happened and he could tell us a little about the reasoning for the change in position.
I would be most interested in hearing his views on this very important subject and perhaps in comment he could tell the House that.


Nelson Andrew Riis: Mr. Speaker, I thank my hon. friend from Kingston and the Islands. I was hoping that someone would ask that question, because it opens up a whole set of areas that I think need to be articulated, particularly in times of the increasing recessionary conditions in which we find ourselves. Let me begin by saying that when it comes to banking I want first of all to refer to the operation and provincial jurisdiction.
As my hon. friend knows, within provincial jurisdictions a number of provinces have already taken initiatives to structure their own financial institutions. This enables them to direct a certain amount of economic policy through these institutions. The province of Quebec, for example, probably has done this most effectively using an arm's length relationship; but also provinces such as Ontario and Alberta are examples where that has been used relatively effectively and we like to think an awful lot more as an arm of government policy.
I also want to take this opportunity to say something about the Federal Business Development Bank. This was

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a bank structured to assist primarily small businesses which would have a difficult time obtaining loans from the traditional lending institutions. I must say that I am most discouraged by this particular initiative. The mandate of the Federal Business Development Bank has changed. I think all members of Parliament who operate with the Federal Business Development Bank in an effort to help small businesses particularly, know now that its mandate has been changed so that it has now become, perhaps, one of the most conservative banks in Canada. The bank has been instructed to make money, to make a profit, and to take no risks. Consequently, I think we all know of instances where collateral of 400 per cent or 500 per cent of the value of the loan is required.
If there is a bank of last resort, it is not the Federal Business Development Bank; it is probably the bank of first resort. If you really do not need any money, the Federal Business Development Bank is more than interested in working with you. If you need money, it is probably one of the last places to go, with some exceptions. I want to say that there are some branches that, in their own way, are able to use the existing policy and still assist some small businesses. I do not want to cast it aside totally, but I do wish the federal government would revise the mandate of the Federal Business Development Bank, particularly at this very critical economic time.
My hon. friend also asks about the whole matter of nationalization of banks. I think that the policy of our party has been to recognize that effective regulation of banking is preferable to nationalizing. Effective regulation recognizes that all of the banks operate on charters that the Bank Act and the charters come through the Parliament of Canada and that the Parliament of Canada is the place to introduce appropriate regulation of banking as well as other aspects of the financial world. I want to say to my hon. friend that rather than simple nationalization, other countries have proven without question that adequate and structured regulation is preferable and that adequate and structured regulation is all that is actually required to direct banking policy in the best interest of what the government policy of the day happens to be. I hope that helps my hon. friend because it is an interesting question and one which comes up frequently. I hope my response has clarified
this, not only in the mind of my hon. friend but in the minds of others as well.
Let me not miss this opportunity to say something about the central bank. The Bank of Canada is, of course, the national bank, owned by the people of Canada. I would say that it is now being used against the people of Canada and that the fundamental policy of the central bank is wrong. I think and, with some exceptions, even my hon. friends who sit on the Conservative benches would have to acknowledge that with a now stabilizing inflation rate, knowing where we are in terms of the economy and the direction in which it is moving, and anticipating the likely introduction of the goods and services tax as of January 1, to continue on with our bank policy of high interest rates and high dollar is tantamount to disaster. I believe that if my friends opposite would reflect their personal views, they would have to agree with that.
Let us not lose sight of the fact that if we had a different government, and a different governor with a different set of priorities in terms of fiscal and monetary policy and part of it channelled through the policies of the central bank, that conditions in this country would be somewhat different, perhaps even spectacularly different. I say, let us not lose this opportunity to reflect on that very important instrument.


Hon. Pierre H. Cadieux (Solicitor General of Canada):: Mr. Speaker, I have a supplementary question. I must admit, right away, that I have not been following the changes in NDP policies very carefully. Since the hon. member for Kingston and the Islands has underlined the fact that there seems to have been a change in the NDP policy on nationalizing banks, and if I understood the hon. House leader of the NDP correctly, he acknowledged that, yes, the position of the NDP has changed. Perhaps he could let this House know when, exactly, the NDP made that change.


Nelson Andrew Riis: One of the strengths of the New Democratic Party is that we do have policies-agriculture, rural Canada, fishing industry, soil conservation, social policy, housing policy. We actually have policies, unlike the Conservatives whose policies are very liquid and the Liberals, well, they just play it day by day, depending on how the wind is blowing. That is their policy. That is one approach. I do not think it is a good one. The Tories have

another one which is mysterious, but we are honest, Mr. Speaker. We are forthright, upfront and open.
I do not recall exactly-I do not memorize these dates-but as times change, the policies change and so our policy on banking is to use regulations provided by the House of Commons, the duly elected government of the country, to regulate the banks to serve Canadians. That is where I think our thinking as a political party would be somewhat different than my friends in the Liberal Party and my friends in the Conservative Party. Where their priorities are legislation to serve the banks, we would have legislation and regulation to serve the people of Canada.


Mr. George S. Rideout (Moncton):: Mr. Speaker, it is a pleasure to rise today to speak on Bill C-83 and to listen to the exciting debate which has been ongoing. I must say that it was delightful to hear the NDP adopting a policy that has been in existence with the Liberal Party for a great many years. As they try to move closer to our position on policy matters, it is interesting to watch them turn themselves inside out in the process. I think the last speaker clearly was inside out.
I would say, as well, Mr. Speaker, that we are supportive of the bill being sent for consideration and clause-byclause study. We also are very cognizant of the necessity for witnesses to come forward and give us their opinion on the four pillars of financial institutions.
This legislation has been long overdue. It has been legislation that has supposedly been coming for the last five years and quite frankly on a preliminary assessment, subject to comments from others, we seem to be getting 1980s legislation to deal with the circumstances of the world in the year 2000. We think that the legislation, while nice, deserves a little more attention, a closer examination and a lot more work either by the finance committee or some other legislative committee.
The Liberal Party has concerns about the bill. We recognize that we are in a global economy and that it is necessary for our financial institutions to be responsive to the global economy and to be in that marketplace. We
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also recognize that a proper balance has to be established so that the Canadian consumers can be protected.
Does this bill do all of those very important things? It is going to take the advice of the different financial institutions and consumer groups to give us the proper instruction, but our concerns are that the legislation, as it is presently drafted, does not go far enough in certain areas.
We in the Liberal Party have been consulting with a number of people in order to get the proper advice. I know the member for London East has been most diligent in liaising with insurance companies in his riding. He has a close association with them and has been getting their advice. I know that my colleague, the critic for financial institutions has, as well, been meeting with a number of banking institutions, trust companies and the Superintendent, to get the background with respect to this legislation. We are veiy anxious to see it brought before the committee.
Quite frankly, we are concerned with the rumours we hear, that the House is going to prorogue, and this is going to result in another delay. We are also concerned about the fact that the legislation was brought in piecemeal. Everyone acknowledges that there are four pillars to this area. What seems to be happening is that the government is bringing in one piece of legislation now and another piece a little later and another piece after that. That is not the right approach. Rather than ending up with four pillars, we may end up with a milking stool before we are done. We are very concerned about that. The government's commitment not to enact legislation until all pieces have been placed before the House is not sufficient. We have to be absolutely sure that the different pieces of legislation work. If they do not, then the results could be very disastrous to the financial community and to consumers in general.
We have to acknowledge as well that in the global world, financial services are offered in the marketplace 24 hours a day, seven days a week. Our institutions have been steadily losing their market share. The share of Canadian banks and security firms as managers of issues in the Eurobond market, for instance, has declined from a high of 6 per cent in 1976 to a low of 2 per cent in 1988.

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In the management of international loans, their over-all share has dropped from 8 per cent in 1983 to 3 per cent in 1988. These very substantial drops are a clear indication that something is not working properly.
I had the fortune or the misfortune, depending on your perspective, of working for one of the chartered banks back in the sixties. The Royal Bank at that time was one of the leading banks in the world. I believe it was fifth or sixth on the list. Now it does not even make the top 50. Thus we see there is a very sharp decline in how our financial institutions are competing globally. We have to do something to deal with that situation.


Patrick (Pat) Anthony Sobeski: How many U.S. banks in the top 10?


George Saunders Rideout: It does not make any difference. We had Canadian banks in the top 10 for years. With this government's mismanagement, they do not even make the top 50. We must talk about the problems that we will be facing.
This government has put forward the free trade legislation and in effect, invited into Canada the American Express organization and made a deal with them, signed, sealed and delivered on election day. We now have American banks in our marketplace. Their subsidiaries are competing with our banks and providing different types of services that our banks are presently excluded from providing. Again, we have kowtowed to the American financial institutions and put our financial institutions in jeopardy. Now we face a situation where we will slip even further behind in the global situation because of the American Express decision. It has changed the playing field to the detriment of our institutions.
As well, we are facing a situation in which 1992 is coming. It used to be when 1984 was going to happen, but now it is 1992 and the European situation. There is going to be an integrated financial situation unless another Conservative has her way. Margaret Thatcher is trying to tilt at windmills and those sorts of things. If her type of attitude prevails, it may not take place. The European Common Market will have a strong central banking institution. If we are going to compete in that area, then we will have to make concessions. If we are going to gain in the European market, then we will have to extend similar treatment to the European and Japanese banks.
We have to make sure that our financial institutions are strong viable and able to compete in the world market. Coupled with all of these problems is the fact that the provinces are now moving into the vacuum that has been left by the lack of federal legislation over the last number of years. There is new legislation in Ontario, Quebec, British Columbia, and my own province of New Brunswick. They have updated their legislation dealing with trust and loan companies. Quebec has the Caisse des Depots, and they are an example of one-stop shopping as far as financial institutions are concerned. The consumer can go into any one of their branches and buy insurance, take out a loan, or make a deposit. Those are the areas that we have to explore and try to balance in making our financial institutions viable and able to compete on the global market, as well as on the national market. Also, we have to come up with the necessary protections for our consumers.
There are really four important areas in this legislation. They are the powers of the financial institutions, the ownership, the regulatory framework and the supervisory system. Those are very important and controversial areas, quite frankly.
The issue of whether a financial institution can be widely held or closely held is important. We see that Canadian banks must be widely held and that there are severe restrictions on exactly how the ownership of shares is to be held. No one can own more than 10 per cent of any bank. At the same time, trust companies with assets over $750 million must be in such a situation that only one person or one organization can own 35 per cent. This allows that trust companies can be closely held. Banks are at a disadvantage in that they must be widely held.
The supporters of widely held ownership feel that this is a safeguard against self-dealing and the misuse of depositors funds. Therefore, banking institutions are less likely to have some hot-shot come in and convince them to invest large sums of money into a high risk venture.
I am not certain whether that will actually work. I was reading an article today in the newspaper about the government in New Zealand being forced to bail out its whole banking institution and its major bank because it had been induced into some rather odd projects by a financier from Australia. There are some risks even in the widely held situation.
November 6, 1990

Another area of concern is the linkage between different financial institutions and whether banks ought to be able to sell insurance, whether non-institutions can own banks, and all those types of circumstances.
The American Express situation is one that comes immediately to mind which puts all of our financial institutions at a decided disadvantage. It competes directly with Canadian firms which are not allowed those same rights. Schedule A banks are not allowed to have commercial financial links. For trust, life insurance, and securities firms, the rules are somewhat different. There is some flexibility in those particular areas.
The issue then becomes: Do we want to give our financial institutions broader powers in these areas? Should banks be able to sell insurance? Will the network system with insurance companies make for such a concentration of wealth and power in the banks that the consumer will subsequently come under jeopardy?
Banks will submit, of course, that premiums will fall because they will have the concentration of power and will be able to deal with that. There is also the fear that, with the concentration of power, in actual fact premiums will rise and consumers will be in jeopardy.
In a similar vein, will banks such as the Bank of Nova Scotia still be able to market Canada Life casualty insurance through brochures and phone lines within their branches? Those are some of the issues that have to be dealt with and require the finance committee or any committee input to go through the legislation and entertain points of view, from banks and other financial institutions as well as from consumers.
Also, we see areas where auto leasing could be made available. Our concern is whether banks should be allowed to move into that particular area. I know that all members in the House have been receiving correspondence from different financial institutions urging us not to allow car leasing to be financed through banks.


Patrick (Pat) Anthony Sobeski: It is not in the bill.


George Saunders Rideout: I acknowledge that it is not in the bill.
It is a matter of looking at our financial institutions and trying to do what is right for the over-all industry. The interesting thing is that most of the car leasing is
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done by American companies-GMAC, Ford Credit, and Chrysler Credit. Granted, they employ Canadians and create jobs in that sense, but the major money and the profits are leaving this country and fleeing to the United States. It is just another arrangement to assist in that area.
We have to decide whether financial institutions are going to be able to promote goods and services through the use of their credit cards. Again, it is going to be interesting to see if the different consumer groups and financial institutions come forward with some thoughts as to what is the appropriate way to set up our banking system.
Our banking system needs a full and complete overhaul. All our financial institutions have to be looked at and perhaps with the start of this legislation we can move to a more active review of institutions. This could create a situation in which the banks, trust companies and insurance companies are better able to compete globally.
I would also mention the areas dealing with regulation and dealing with self-dealing, conflict of interest, and corporate concentration. We have to be very mindful of what happened in the United States with the savings and loan fiasco and the fact that if it has not bankrupted the United States it is very close to doing so with $500 billion being taken out of the economy in order to bail out the savings and loan institutions in the United States. We have to be very clear that our regulations and the powers that are contained with the superintendent are strong and can avoid those types of disasters.
We have seen a touch of it here in Canada with the problems which occurred in Alberta and those financial institutions that went down because of mismanagement or perhaps a whole host of things. The net result is that a lot of people lost a lot of money. That was just one institution. If that spreads throughout all of our institutions and we continue to lose confidence in these institutions, then they will become less effective and not able to deal with the economic development policies of our country and of individual provinces.
In addition, we face the problem of federally regulated organizations as they compare with provincially regu-

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lated organizations. Our experience so far is that the federal government has allowed a void or a vacuum to develop and the provinces have moved in and taken over or filled this void. We now have to decide whether we are going to be competing on a federal basis or on a provincial basis with a lot of these institutions. Again we have to try to ensure that all of these institutions are going to be subject to some regulatory control so that the confidence is maintained in our financial institutions.
With respect to self-dealing, again, we have to ensure that there are no non-arm's length transactions. The argument is that widely held corporations move that institution closer to a situation where there cannot be self-dealing and it cannot have conflict of interests. I am not sure whether that is really the case when you look at it. We have to ensure that the superintendent's powers are as broad as possible and that he is given authority to go in, conduct audits, and move in a positive vein. The impression I am left with is that the superintendent utilizes moral suasion in most cases, rather than adopting an approach whereby he has actual powers to force the different financial institutions to carry out his wishes. This becomes very critical because, again, if we have a run on our financial institutions, we are going to face problems. We must maintain confidence.
I know that my time is running out and I would say in conclusion that we are supportive of the bill in its general thrust. We are supportive of it going to the finance committee for review. We are looking forward to the opportunity of hearing from a wide variety of people who have a vested interest, from consumers to financial institutions, in the hope that we can take what is mediocre legislation and turn it into something that is a lot better.


Patrick (Pat) Anthony Sobeski: Mr. Speaker, I am also looking forward to getting the bill to the finance committee to have a look at it. I am sure the hon. member, and the member for Nickel Belt, will have constructive things to add to this particular bill.
The one thing I have heard today is that there are already things in the bill to protect the consumers. There are things that are not in the bill that members want to bring on to the floor, such as banks getting into car leasing, which will not be allowed. There are many things to discuss and I am looking forward to those meetings.
One thing I would like to clarify and get the hon. member's opinion on is that the legislation will permit institutions without insurance underwriting powers, such as banks and trust and loan companies, to own companies, but the rules will restrict the retailing of the insurance by the deposit-taking institutions. The illusion that is being left is that it is all going to be banking under one roof.
The member for Kamloops, when he spoke earlier, talked about the concerns that the small insurance broker on Main Street would be impacted by this. I do not know where the concerns are coming from. The retailing of insurance will not be allowed.
For example, right now one of the concerns that people have is that branches through telephone or computer links can sell insurance. That will not be allowed. Banks will be restricted from servicing insurance policies. There is also a concern about the flow of information, that indeed that information will be passed along. That is a concern, but again the legislation attempts to eliminate that amount of disclosure.
The banks will still be allowed to sell their particular services, but that small broker on Main Street, who is the professional in providing property, casualty, and home insurance, will still be the expert whom the consumer will go to.
If the member has any concerns about that, I would like to know about it because indeed the legislation is a fine balance between ensuring that the large banks continue to grow, but indeed the consumers have a wide diversification of people to go to. For example, professionals who have been selling home insurance for years will still be able to do that. They will not sell home insurance in a financial institution, but rather they will sell it on Main Street.
I hope the member will agree with me that that part of the legislation is good and I would like him to comment on that. Again, I look forward to his comments when we do get to committee with this bill.


George Saunders Rideout: Mr. Speaker, I should say that I appreciate the question that has been put forward. I acknowledge that, in a general sense, there are some protections within the legislation designed to protect the small insurance agent. My concern, and I think it is the concern of others, is that as we have this potential for a concentration of power within financial institutions, particularly in the insurance area, there is by a process of influence, suasion, or whatever means, a taking away of
November 6, 1990

the independence of the small broker and putting it into the hands of the large financial institutions.
Our concern mainly is what happened with American Express and the services that it now offers with its subsidiaries. That is going to be taking place in our financial institutions because the banks are going to have to be allowed to do the same thing.
My time is up and I will try to answer that later. [Translation]


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.

Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, while freedom of expression is one of the values we cherish most in Canada, it also permits us to challenge the views of those with whom we disagree.
I therefore express deep concern about British author David Irving's tour of Canada. His claims that the Holocaust has been exaggerated only distorts history, minimizes the atrocities of the Nazi regime, and sows the seeds of hatred. We know only too well that the promotion of hatred against identifiable minorities leads to acts of violence, as we witness daily around the world.
Irving reportedly said in Ottawa last night that Hitler never knew what was going on, that no gas chambers were used to kill Jews, and that gas chambers seen today at Auschwitz were built after the war. Such words of course confound those who lost their dearly beloved family and friends at one of the lowest points in human history.
I know Mr. Irving's views are rejected by the majority of Canadians, including members from all sides of this
House, and that Canadians will rally around the truth, reject prejudiced views like Mr. Irving's, and stand up for the peaceful, tolerant and respectful society that we all are.


TRIBUTE TO BOMBARDIER INC.
Mr. Yvon Cote (Richmond-Wolfe):: Mr. Speaker, it is a pleasure to draw the attention of the House to the fact that a company in my riding, Bombardier Inc. in Val-court, received two major awards last week. Bombardier's marine products division was awarded the "Palme d'or" in the industrial design category, for designing and developing the Sea-doo, a water sports vehicle that has won 15 per cent of the North American market in only three years.
On the same occasion, another division of Valcourt received the "Palme d'argent" for excellence in the industrial design of ski lift equipment.
Mr. Speaker, these awards were given in recognition of the exceptional design qualities of a product manufactured in Canada. I take great pride in the fact that a Quebec company from Valcourt, in my own riding of Richmond-Wolfe, was able to compete and indeed win recognition on a national level.
Congratulations to all engineers and staff at Bombardier in Valcourt!


COMMENTS BY PRIME MINISTER
Mr. Sid Parker (Kootenay East):: Mr. Speaker, last weekend the Prime Minister threatened Quebecers with the loss of their pensions in the event of separation. While I share the Prime Minister's belief in national unity, his comments again show that, given the choice, he will choose his macho, bullying approach over consultation and compromise.
He has used this aggressive and unproductive style to claw back pensions, force his GST down the throats of Canadians, impose his high interest rate policy, and bring our country to the verge of collapse.
When is the Prime Minister going to realize that Canadians will not accept being bullied and that his style

is a thing of the past? Canada's future cannot stand many more macho outbursts from the Prime Minister.


HMCS PROTECTEUR
Mr. John E. Cole (York-Simcoe):: I would like to advise you, Mr. Speaker, and members of the House of Commons of the initiative taken by the council and residents of the town of Newmarket, my home town.
The town has decided to "adopt" the HMCS Protecteur serving in the Middle East and will be sending letters, magazines and newspapers to the ship to show concern for those on board.
The sailors enjoy reading letters from home in their spare time and it is important for their morale to know that individual Canadians have taken the time to show they care.
I know the residents of Newmarket will support this project and I challenge other communities and all Canadians to take a moment to write to these young men and women and let them know our thoughts are with them and they are not forgotten.
In these uncertain times, the certain support of the citizens of Newmarket and all Canadians is appreciated and is veiy important to those serving overseas.


CP WESTIN SHOPS
Mr. Ronald J. Duhamel (St. Boniface):: Mr. Speaker, recently a member of the House of Commons raised the issue of occupational health safety at the CN shops in Transcona. He was referring to the presence of asbestos in the powerhouse.
I would like to raise another such issue. The conditions which the employees at CP's Westin shops are exposed to are dangerous and potentially harmful, to say the very least.
Recently, employees were asked to dismantle a boiler insulated with asbestos strips. Employees were exposed to asbestos dust for a three-week period in April of this year. In both situations, management was irresponsible.
Further, on October 16,1990, a safety officer inspected the Westin site under subsection 145(1) of the Canada Labour Code and found that there were contraventions.
I summarize. No warning signs to inform employees of asbestos insulation in the preheater; asbestos containing materials in boilers were not identified; employees had not been provided with the information, instruction, training and supervision necessary to ensure their safety and health at work. There has been no hazard assessment of asbestos in the workplace. The government must take responsibility to ensure that the workplace of all employees is safe and free of health hazards.

The government must ensure that the health and safety of all employees, in the place of work and elsewhere, remain a priority and a matter of constant concern.


Mr. Guy Saint-Julien (Abitibi):: Mr. Speaker, Canada's Minister for International Trade announced that export duties levied on certain lumber products sold by Quebec on the American market will be reduced from 8 per cent to 6.2 per cent as of now, to 3.1 per cent by November 1, 1991, and to 3 per cent a year later, until October 31, 1994.
This decision, made on October 31, 1990, by senior officials of the government of Quebec, External Affairs and International Trade Canada and the United States, arises from a memorandum of agreement signed in December 1986 by Canada and the United States. The reductions in question reflect the value of substitute measures adopted by Quebec.
The Quebec Lumber Manufacturers Association has reacted favourably to an announcement that is very good news, Mr. Speaker, for Abitibi-Temiscamingue.


THE ECONOMY
Giuseppe (Joseph) Volpe: Mr. Speaker, Jimmy Swaggart must feel proud. His public penitence, a modern form of self-flagellation and public humiliation minus the sackcloth and ashes, of course, in the hope of expiating one's sins is now a model for political leaders, ones who are unwilling and unable to correct wrongs they visit upon an unsuspecting citizenry.
November 6, 1990

"Oh, we could have done more to cut the deficit," said the Prime Minister to viewers and listeners in southern Ontario last night. "Had we done more earlier, our problems today would be less. No doubt about it," conceded our Prime Minister to an irate audience. "Yes," he admitted to those waiting relief, "the goods and services tax is coming at a difficult time as the country heads into a recession". But, will he do anything about it? Well, no time is a good time for a new tax, we are told. Besides, our valiant leader does what he thinks is right and not what the overwhelming majority of Canadians knows to be right. How similar is this to a wolf's confession? One can almost hear in the distance the penitent predator in the confessional addressing the confessor with an absolution: "If you will, quickly, Padre, I think I hear sheep coming over the dell".


REVENUE CANADA
Mr. Michel Champagne (Parliamentary Secretary to Minister of State (Forestry)):: Mr. Speaker, the Minister of National Revenue wields a policy that discriminates against taxpayers.
Mr. Rejean Perron of La Tuque failed to file a return for 1985-86.
Mrs. Joncas at the Identification and Compliance Section sent him a letter on October 6, 1989, ordering Mr. Perron to file his tax returns as soon as possible.
After he did so, it turned out Revenue Canada owed him money for the two years in question. However, the minister refused to refund the money, stating he had only three years to claim his refund and that he was too late.
How could Mr. Perron meet this deadline when he received the letter four years after the year 1985?
Mr. Minister, your department insults Canadians by this abuse of its administrative authority. Since all citizens have to pay taxes, the same should apply when the government owes money.
In the case of Mr. Perron, despite the fact that you were aware of the case, you did nothing except pass the buck to the Minister of Finance.
I suppose that is what you mean when you say you act responsibly.


TANKER TRAFFIC
Ms. Lynn Hunter (Saanich-Gulf Islands):: Mr. Speaker, it has been almost two years since the Nestucca oil spill off the British Columbia coast confirmed our worst fears about oil shipments. That incident led to an emergency debate in this Chamber, demands for a full public inquiry and for an environmental assessment of the Westridge loading facility in Vancouver Harbour.
Since that time, tanker traffic in Vancouver Harbour and the Strait of Juan de Fuca has increased fourfold. The size of the tankers has expanded and the volume of crude exports has gone up 2,000 per cent. Despite repeated warnings and recommendations contained in no less than three high profile reports, and an acknowledgement by the Coast Guard that it is not equipped to handle a major spill, the government has refused to take action.
Last week, the government received the final report of the Brander-Smith Panel on Tanker Safety. The government's response was predictable. The inevitability of a large spill in the Strait of Juan de Fuca affecting the Gulf Islands has once again been ignored by this government.
The evidence is clear and the potential for disaster obvious. When will this government act in the interests of the British Columbia people and implement the Brander-Smith recommendations?


FAMILY VIOLENCE
Mrs. Pierrette Venne (Saint-Hubert):: Mr. Speaker, across the country, one woman out of 10 suffers verbal, sexual or physical violence inflicted by her spouse. Most victims of family violence do not call in the police until after the 34th instance of assault. This figure does not include the thousands of women who never lay charges at all.
Mr. Speaker, on Monday, November 12, the women of Chateauguay will have a new shelter to escape family violence. The new shelter, the Re-Source, will open its doors thanks to an interest-free mortgage loan of

$225,000 provided under the shelter operation program of the Canada Mortgage and Housing Corporation.
A solution to the problem of family violence will not be found overnight, but meanwhile, operation shelter, an initiative of the Conservative Government, will help women from Chateauguay and 14 other municipalities in Quebec escape family violence.


MERCHANT NAVY
Mr. George Proud (Hillsborough):: Mr. Speaker, we must recognize the contribution made by merchant seamen to Canada's struggle during the two world wars and the Korean War.
While merchant seamen were not members of the Armed Forces, they played a crucial role in the allied victories. Without the merchant navy, our forces would have been deprived of vital supplies of food, weapons, ammunition, vehicles, fuel and other essential items. Merchant seamen ran the same risks as members of our army, navy and air force. Too often, they paid the same price.
The United Kingdom and the United States have legally recognized their merchant seamen as having served on active military service, and they are entitled to equal benefits. Do members of the Canadian merchant navy not deserve the same treatment?
Yes, Mr. Speaker, they do deserve our honour and support for their sacrifices. This should be clearly demonstrated by giving them full status under veterans legislation, with no discrimination whatsoever.


VETERANS AFFAIRS
Mr. Peter L. McCreath (South Shore):: Mr. Speaker, this week Canadians and others around the world will observe Remembrance Day. Since this annual observance began, following the war to end all wars, there has not been even a moment in history when there has not been a war or armed struggle going on somewhere.
Remembrance Day is marked lest we should forget those who fell, or those who served.
Canada has an enviable reputation around the world for the tangible programs and benefits we provide to our
veterans. It is important that we continue to remember and to serve the 600,000 Canadians who are veterans.
The consequences of wartime service are just now catching up with many of our veterans, whose average age is 70 years. For some, the normal ailments of aging are compounded by the weeks of youth spent fighting in the flooded Dutch fields or standing watch on the frigid decks of a corvette on the North Atlantic run.
I compliment the Minister of Veterans Affairs for bringing forth Bill C-87, illustrative of Canada's continuing commitment to our veterans, and urge all members to give it their full support.


EXTERNAL AFFAIRS
Mr. Svend J. Robinson (Burnaby-Kingsway):: Mr. Speaker, many Canadian members of Parliament have been approached by the families of those Canadians who are currently in Iraq and Kuwait and unable to leave.
I have urged the Secretary of State for External Affairs to agree to permit a Conservative member of Parliament to take part in an all party parliamentary mission on a humanitarian basis to Iraq and to Kuwait in order to assist the families who are feeling such a sense of pain and loss at this very difficult time.
There are some 27 men in Baghdad and 13 in Kuwait. These families are deeply concerned. I have spoken personally with a number of them. There have been delegations from many other countries, but our government so far has refused to take this important humanitarian step.
Indeed, the Prime Minister has referred to those Canadian citizens who are trapped there as being few in number and not in dire straits.

Mr. Speaker, this silence is particularly ominous, considering the Conservative government's recent threats that, with the United States, it would use force against Iraq, without the consent of the United Nations and even without a mandate from Parliament.
On behalf of the families and on behalf of all Canadians who condemn this government's silence and failure to act, I ask the government to allow a multiparty delegation to take part in this humanitarian mission.


COMMENTS BY PRIME MINISTER
Mr. Felix Holtmann (Portage -Interlake):: Mr. Speaker, last night on CFTO TV, the citizens of southern Ontario had their question period with the Prime Minister of Canada.
They asked numerous questions of genuine concern on a broad range of subjects, to all of which our Prime Minister responded honestly and directly.
Real Canadians are not interested in sleaze questions. Ordinary Canadians are not interested in character assassination.
Congratulations to Tom Clark. He would make a great Speaker of this House. Congratulations to the Canadians who posed the questions to the Prime Minister. They would make the opposition in this House look shameful, tasteless, and ineffective. Congratulations to the Prime Minister for making tough decisions and showing real leadership.


Mr. Speaker:: Any time Mr. Clark would like to take over I am quite prepared to vacate the chair.


Some hon. members:: Oh, oh.


GOODS AND SERVICES TAX
Mr. Ron MacDonald (Dartmouth):: Mr. Speaker, we all remember the Minister of Finance, in introducing the dastardly GST, indicating that it was a fair tax that would lead to much increased prosperity in every part of Canada. He also said the GST would have a one time inflationary impact of 1.2 per cent.
According to recent polls, we know that the people of Canada do not believe him and in Atlantic Canada only 3 per cent support his goods and services tax. Now the Tory Minister of Finance for the province of Nova Scotia, Greg Kerr, has said he does not believe the minister's prediction either. He has predicted that the GST will drive the inflation rate up over 7 per cent next year in Atlantic Canada, twice as high as the projections of the federal government.
Canadians, but in particular Atlantic Canadians, have suffered enough because of this government's economic policies. There have been billions in cutbacks for regional development, health care, education, and equalization payments. Enough is enough.
Oral Questions
If this government does not want to hear the bad news from Canadians, then it should listen to it, Tory buddies like the Minister of Finance for the province of Nova Scotia, realize the folly of its ways and withdraw the 7 per cent GST, and do it today.



ORAL QUESTION PERIOD


Hon. Herb Gray (Leader of the Opposition):: Mr. Speaker, my question is for the Minister of Finance.
Today the shower of bad economic news raining on Canadians from this government is continuing. Statistics Canada has reported that the composite leading indicator, a measure of how this economy is expected to perform, is down for the seventh month in a row, which its economists say mean that this recession is going to last longer than six months.
There is more bad news. Domestic auto sales are down 19 per cent compared to a year ago, which means a lot of suffering for thousands of Canadian workers and their families from plant closings and lay-offs in this key industry.
Why does the minister want to create such a grim holiday season for thousands of Canadians and their families? Why won't he bring in new economic policies, including lowering interests rates right now, that will roll back this recession instead of making it much, much worse?


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, there is one element in the drop in auto sales which I think is significant, and that is that the fleet buyers who are going to be major beneficiaries of the GST are holding back from purchasing because-


Some hon. members:: Oh, oh.


Mr. Peterson:: Wonderful proposal!


Michael Holcombe Wilson: Members opposite are laughing. What will happen with the GST is that the cost to the fleet manufacturer will drop by 13.5 per cent. It is an important part in their competitiveness for them to hold off.
They are going to be major buyers by January 1, 1991. That is going to provide a boost to the production of the automobile companies. It will result in a savings for those people who lease cars and for those people who are going to rent cars. That is one of the things that I

November 6, 1990
Oral Questions
think is helpful to understand, rather than have these distorted statements made by the Leader of the Opposition about the economy.


Herbert Eser (Herb) Gray: Mr. Speaker, what the minister calls distorted statements are coming from his own statistical agency, Statistics Canada.
Canadians do not believe the minister when he talks about the GST. The auto companies are offering rebates right now which they say are equivalent to any savings from the GST, and still cars are not being sold due to this government's economic policy.
In fact, John Winter, a leading retail consultant, said: "The grinch," and I guess he must mean the Minister of Finance, "has already stolen Christmas and probably has his eye on Labour Day next year".
Deloitte & Touche, a major accounting firm, says that 43 per cent of retailers expect to have lower sales this Christmas than last year. In fact a senior partner in this firm said: "There's a lot of walking wounded out there".
When is the minister going to do something for the walking wounded he has created, the small business people, small retailers, in fact almost all Canadians who are suffering from this minister's made-in-Canada recession? When is he going to do something to help these walking wounded?


Michael Holcombe Wilson: Mr. Speaker, I am not aware of the many deals now being offered to the fleet buyers by the car manufacturers. They are going to be buying those cars with a major saving after January 1. I think we will see quite an increase in purchases by the fleet manufacturers.
The hon. member refers-and I have the article right here-to the problems in the retailing sector. What my hon. friend could do with the retail sector is encourage his friends down the hall in the Senate to pass the GST so we could get on with the payment of some $600 million to low income Canadians to help them purchase things during the pre-Christmas period.
What I am hearing from the other side is that it is the weakness of Jean Chretien as the leader of the party, the weakness of Jean Chretien who is not capable of controlling the Senate, who is not-


Mr. Speaker:: The hon. Leader of the Opposition.


Herbert Eser (Herb) Gray: Mr. Speaker, John Winter, a leading retail consultant, and Deloitte & Touche, are not blaming what they predict to be a disastrous Christmas season for retailers on anything to do with the GST. They are talking about this minister's economic policies. He ought to face that, accept it, and do something about them.

Mr. Speaker, the recession created by this minister is genuine and it affects all sectors of our economy.
Last week, Pratt & Whitney announced that 850 employees would lose their jobs, and today, Marine Industries in Quebec has announced 700 layoffs.
I therefore want to ask the Minister of Finance what he is waiting for to introduce job creation initiatives. Why does he insist on making life miserable for all Canadians?


Michael Holcombe Wilson: Mr. Speaker, doesn't the hon. member think that it would be helpful if Jean Chretien, Leader of the Liberal Party, showed a little backbone and stood up to Allan MacEa-chen and said: "Senator MacEachen, there are 7.5 million or 8 million Canadians expecting $600 million from the passage of the GST. It is important for the retail sector of the country". But, with the flip-flops of Jean Chretien where one day he says: "We are going to do one thing about the GST" and another day says: "We are going to do something else," who knows?
The hon. member referred to Mr. John Winter. I want to point out something in this article. Some 32 per cent of retailers predicted businesses at their stores would rise faster than inflation. Another 21 per cent expected sales gains of 3 per cent to 5 per cent. That is 53 per cent. Some 47 per cent feel that sales will drop.
The message that I draw from this, and it is said by Ron Corbett in The Ottawa Sun today, "Some days I can't help but wonder if what we are doing is right, if we aren't somehow creating a self-fulfilling prophecy in our coverage of the recession".
November 6, 1990

It is the statements by the Leader of the Opposition who turns everything into a negative because-


Some hon. members:: Oh, oh.


Mrs. Diane Marleau (Sudbury):: Mr. Speaker, the Prime Minister is making a last ditch attempt to go up in the polls by pretending to listen to Canadians.
However, the message was and remains quite clear: 76 per cent of Canadians don't want the GST. Furthermore, the government's policies have generated excessively high interest rates, leading to falling profits, bankruptcies, and successive layoffs.
Mr. Speaker, my question is directed to the Prime Minister or, in his absence, to the Minister of Finance. Now that the Prime Minister has decided to lend an ear, is he prepared to lend Canadians a hand and change his disastrous policies?


Michael Holcombe Wilson: Mr. Speaker, I say to my hon. colleague opposite that if she is concerned about the people who need some help now, there are 7.5 million or 8 million Canadians who are looking to receive some $600 million in total of GST credit cheques before Christmas.
That is important for the retailing sector in this country. It is important for those Canadians whom she is concerned about. If she feels strongly about that, she should speak to her leader, Jean Chretien, and ask him to stand up once and for all to Senator MacEachen, who is pulling the strings of the marionette, Jean Chretien.


Diane Marleau: Mr. Speaker, if this government wants Jean Chretien to run this place, perhaps it should resign and-


Some hon. members:: Hear, hear.


Diane Marleau: Yesterday, Mr. Speaker, the Prime Minister stated:
Well, the hell with it. The structural changes have to be made.
This economy will not survive without those kind of changes.
The economy has been seriously wounded and is failing fast.
Oral Questions
My question is for the Minister of Finance. Will he take action, help us survive, and ease his monetary policy before the only structure left in this country is the flat line and we are dead? Will the minister help us?


Michael Holcombe Wilson: Mr. Speaker, that just underscores my point about the exaggerations that are made.
Certainly the economy is in trouble. We must be doing what we can to get the economy pulled back together again. That means getting inflation down. That means getting interest rates down, but it also means allowing some of the changes that we are trying to bring in to help the performance of the economy, such as the goods and services tax which will help low income Canadians and which will reduce the cost of production for companies to help them compete better internationally.
I say to my hon. friend that she should speak to her leader, Jean Chretien. We are not asking Jean Chretien to run the country. We are just asking him to take on a smaller job of trying to run the Liberal Party of Canada.


INDIAN AFFAIRS
Mr. Robert E. Skelly (Comox-Alberni):: Mr. Speaker, my question is directed to the Deputy Prime Minister.
When the House finally reconvened after the summer of native discontent, the Prime Minister made three specific promises in this Chamber to native people: improvements to the specific lands claims process, fulfilling treaty land obligations which had been outstanding for over 100 years, and the acceleration of modem treaty negotiations based on comprehensive land claims.
On another occasion, the Prime Minister also proposed a royal commission into aboriginal issues. But last Saturday, Senator Lowell Murray indicated that the royal commission and other proposed reforms would have to wait until after the Spicer committee reported on July 1. "Frankly, he said, "we don't want to distract from the more fundamental issues".
Given that Meech Lake collapsed in part because aboriginal people were locked out of the process, is the government now prepared to repeat that failure with the Spicer commission, or will the Deputy Prime Minister

November 6, 1990
Oral Questions
repudiate Senator Murray's comments now and keep his government's promises to native Canadians?


Hon. Don Mazankowski (Deputy Prime Minister, President of the Privy Council and Minister of Agriculture):: Mr. Speaker, obviously the hon. member has been somewhat misinformed because there has been substantial progress made in the areas of land claims, treaty rights, and the over-all improvement of conditions for our aboriginal peoples which has been conducted under the very capable leadership of the Minister of Indian Affairs and Northern Development.
I think what the Senator was saying is that until such time as there is some consensus built in the nation as to how we best deal with the issues of the aboriginal peoples, it would be counterproductive to attempt to engage in any constitutional dialogue per se.
There have been a number of attempts made at that, and that does not take away from our resolve to deal with it, but I think this process will have to be allowed to take its course so that we can build a better consensus and a better understanding between aboriginal peoples and all Canadians across the country.


Robert Evans Skelly: Mr. Speaker, I have a supplementary question for the Deputy Prime Minister. On Sunday the Prime Minister promised he will shortly make a formal apology in the House of Commons to all ethnic groups mistreated by the Canadian government and consider compensation.
However, if you have your land stolen, your water poisoned, your children forcibly removed and adopted to foreign countries, or subjected to sexual abuse in residential schools, if you are the first citizens of this country you get nothing until the Spicer committee reports. Is this not the government saying, first come last served?


Hon. Thomas Siddon (Minister of Indian Affairs and Northern Development):: Mr. Speaker, I think it is most inappropriate that the hon. member tries to oversimplify a situation by suggesting that no positive initiatives will be taken on behalf of the aboriginal people of Canada.
The Deputy Prime Minister has clearly pointed out that the words of the Prime Minister, as stated in this House, are being fulfilled by specific and concrete actions. The historic meeting of the Prime Minister with B.C. aboriginal leaders for the first time since 1910 is an example of that commitment. The meetings that have taken place with the Federation of Saskatchewan Indians on treaty land entitlement, which I will continue this week, are evidence of that commitment.
The Prime Minister's appointment of a prominent aboriginal leader, Miss Carol Corcoran, to the Citizens' Forum on the Future of Canada are all clear evidence of this government's commitment to make very positive progress on behalf of our aboriginal people.


Mr. Ian Waddell (Port Moody-Coquitlam):: Mr. Speaker, I do not know what planet this government is on. I want to direct a supplementary question to the Minister of Justice.
As I put the question now, in our own province of British Columbia we are seeing a repeat of Oka, a mini-Oka where the RCMP are called in once again to remove a barricade.
What has the minister done? What initiative has her department taken to prevent these mini-Okas? What does she propose to do concerning the present situation at Duffey Lake near Pemberton? Has she taken any initiatives or is she going to just stay asleep at the switch and perhaps allow violence in our own province of British Columbia?


An hon. member:: As she did last summer.


Thomas Edward Siddon: Mr. Speaker, the rhetoric of the hon. member is extremely irresponsible. The events of the summer months have been very tragic for all Canadians. This government has made it quite clear that we are prepared to negotiate the settlement of comprehensive and specific claims and to improve the means of conducting those negotiations.
We made that undertaking in British Columbia some weeks ago and the people of the Lillooet Nation and Mount Currie Band are entitled to access that process. I will be meeting the Chief of the Mount Currie Band tomorrow morning to discuss these issues further.
November 6, 1990

The courts of British Columbia had deemed that all British Columbians and all Canadians must abide by the law and not use road blocks to achieve their ends.


Mr. Rey Pagtakhan (Winnipeg North):: Mr. Speaker, my question is for the Minister of National Health and Welfare. Last night Canadians learned that national defence allowed Canadians to serve as volunteers in the clinical trial of HI-6, a drug which is being tested as an antidote against nerve gas poison, without them being fully informed that the drug could cause cancer in addition to birth defects.
Since the Health Protection Branch apparently insisted to researchers that the consent form should indicate the drug is carcinogenic, could the minister now explain why the study went ahead despite non-compliance with our Canadian ethical and safety standards? Was he surprised? And would he now issue a directive to halt continuation of this study unless it reveals all known side effects to volunteers and thereby ensure informed consent?


Hon. Perrin Beatty (Minister of National Health and Welfare):: Mr. Speaker, the Department of National Health and Welfare is very determined in any case where testing of drugs takes place to ensure the safety of all the volunteers. That was why in the consent form, considerable detail was gone into to ensure that volunteers were informed of potential side effects.
Included among the warnings on the consent form-I do not know if my hon. friend has seen it or not-is the following statement: "As with any drug, unexpected and potentially serious effects, including fatality are always a possibility". We went into specific details. We also said that other unanticipated side effects, including fatality, could be a possibility. We have asked that in subsequent trials during Phase 2 that this be elaborated on even further, to make reference to the fact that we should be cautious to ensure that there are cancerous side effects, notwithstanding the fact that we have no evidence to date to suggest that such side effects could occur.


Ms. Albina Guarnieri (Mississauga East):: Mr. Speaker, once again the minister has shown that his own department has regulatory impotence. Less than 1,000 American dollars will buy a Canadian human guinea pig
Oral Questions
in Tory Canada. Mr. Trottier, one of the Canadian human guinea pigs the minister referred to was not aware of the tests being conducted on him. The minister should reread the contract.

My supplementary is directed to the same minister. It is a recognized fact that the American government offers grants in Canada for research on chemical and biological warfare.
I want to ask the minister to inform the House today when he will demand that the Minister of National Defence stop overruling his own department's regulations and when he will prevent Canadians, who are either needy or misinformed, from being bribed to serve as guinea pigs for purely military ends.


Henry Perrin Beatty: Mr. Speaker, the hon. member says I should again read the contract. Indeed, I will. As with any drug, unexpected and potentially serious effects including fatality are always a possibility.
The hon. member makes false allegations again, as is often the case. She should recognize the fact that Canadian troops are today in an area of the world where potentially they could be exposed to nerve gas. They are up against a regime which has used nerve gas against its own civilian population.
The goal of the Department of National Health and Welfare is to ensure that informed consent is given and to ensure that all possible information is made available. Not only was specific information given here, but there were warnings that unanticipated side effects could be found. We have gone beyond that and said that in Phase 2 there has to be specific reference made as well to the possibility of carcinogenicity, notwithstanding the fact that we have no direct evidence showing that HI-6 can cause cancer.


REMEMBRANCE DAY
Jerry Pickard: Mr. Speaker, my question is for the Minister of Veterans Affairs and concerns Remembrance Day.
The minister will know that the Dominion President of the Royal Canadian Legion has specifically written the

November 6, 1990
Oral Questions
Prime Minister protesting the Prime Minister requesting the Governor General to go abroad on November 11.
Will the government reverse this request and immediately urge the Governor General to remain in Canada, fulfil his obligation as a Commander in Chief of the Canadian Armed Forces and participate in Remembrance Day services here in Canada.


Hon. Gerald S. Merrithew (Minister of Veterans Affairs):: Mr. Speaker, His Excellency the Governor General will be attending the enthronement of Prince Akihito, along with members of the Royal Family, heads of state, heads of governments from around the world, Governors General from all the Commonwealth countries, representing the people of Canada at that event.
It is extremely important to note that on November 11, His Excellency will be attending a Memorial Service at Yokohama Cemetery, along with members of the military, two recipients of the Victoria Cross for Canada, and with other members of Parliament from this particular House. I know his thoughts will be with us.
He will be attending on this particular occasion, a very important ceremonial event on behalf of the people of Canada.


Jerry Pickard: That is a very disappointing answer for veterans who have given so much.
My supplementary question is for the minister responsible for Canada Post and also concerns Remembrance Day. We as a nation face a unity crisis. It is imperative that we hold tradition, unity and history in high regard. Remembrance Day is an institution which unifies all Canadians.
This concept is being threatened by management contract negotiations at Canada Post, where postal workers may lose their right and ability to participate in Remembrance Day services.
Will the minister maintain the Canadian Remembrance Day tradition by demanding that Canada Post respect this custom now and in the future.


Harvie Andre: Mr. Speaker, I do not think anyone on this side of the House needs
to apologize concerning the reverence we pay to Remembrance Day and all it represents.
Labour negotiations are currently under way at the post office. The union has decided to take the public route on one particular item, giving one side of the story. Apparently, the hon. member has taken it as 100 per cent accurate and I do not choose to do that. We will let the responsible parties at the negotiating table complete their negotiations.


Mr. John Brewin (Victoria):: Mr. Speaker, my question is for the Minister of National Defence on the HI-6 issue which has already been raised during Question Period. It was his department, according to my understanding, that was responsible over all for the tests on these four individuals. Two of the four said last night on television that they were simply not aware of the risks involved.
I have a letter from the Minister of National Defence to my colleague the hon. member for Skeena, dated July 30,1990 which states: "You are correct in stating that the drug HI-6 is a known carcinogen". That directly contradicts the statement just made in the House by the Minister of National Health and Welfare. Which minister is correct?


Hon. Bill McKnight (Minister of National Defence):: Mr. Speaker, if the hon. member is referring to a letter I sent to his colleague dated September 4,1 will read that letter.


Some hon. members:: No, no.


William Hunter (Bill) McKnight: Mr. Speaker, if I could read the letter. If the NDP would allow me, Sir, I would like to read the letter.


Mr. Speaker:: Perhaps the hon. minister could tell the House what is in the letter.


William Hunter (Bill) McKnight: Mr. Speaker, I would like to read a letter I signed dated September 4:
Details on the component chemicals used in the synthesis of HI-6 were included in our Investigational New Drug submission made to the Health Protection Branch, Department of National Health and Welfare. Even though one of the chemicals, bis-chloromethyl ether (BCME), is a known carcinogen, this compound and its toxic properties are completely changed when it is combined to make HI-6. In this respect, the toxicity of BCME is not relevant to the toxicity of HI-6 -
November 6, 1990


John F. Brewin: Mr. Speaker, the minister will be aware that Doctor Mendoza, who is one of the pioneers of research in this area, has directly contradicted the statements made in that letter by the minister. Furthermore, the drug is banned in the United States and Doctor Mendoza has said that testing in the new year will be premature.
I would ask the minister if he will order that the tests proposed for the new year not take place.


William Hunter (Bill) McKnight: Mr. Speaker, as the hon. member is a defence critic for the New Democratic Party, I would suggest to him that with the members of the Canadian Armed Forces presently serving in an area where chemical weapons have been used and have the potential to be used, he should be supporting the development so that we have in Canada a secure national source of an antidote for chemical warfare.
The member should also understand, Mr. Speaker, and I do not know whether the New Democrats really want to have the question answered, that this chemical HI-6 is available for sale in Sweden and in Yugoslavia. The reason we are developing new drugs in a new drug format in Canada is so that we can have a secure national source for the Canadian men and women who serve this country.


GUN CONTROL
Mr. Derek Lee (Scarborough -Rouge River):: Mr. Speaker, my question is directed to the Minister of Justice. Earlier this fall the Canadian Association of Chiefs of Police asked the justice minister to grant a Canada-wide gun amnesty to help reduce and control the number of illegal and unwanted guns on Canadian streets. The 1978 amnesty brought in about 47,000 such unwanted and unregistered weapons just like the kinds of guns that were used in Scarborough in September to kill two 15-year-old youths in separate incidents.
What is preventing the Minister of Justice from proceeding immediately to a general amnesty to help Canadian police forces in their fight against violent crime?
Oral Questions


Hon. Kim Campbell (Minister of Justice and Attorney General of Canada):: Mr. Speaker, the main impediment to my doing what the hon. member suggests is a lack of legislative authority.
Contrary to articles in journals such as The Toronto Star, I do not have the legislative authority to declare a national amnesty on firearms.
I have been in communication with the provincial attorneys general and the provincial firearms officers to discuss the possibility of an amnesty, particularly in concert with our own firearms legislation. That would provide an opportunity for a public education campaign.
I should point out to the hon. member that it is within the authority of any chief of police to engage in an amnesty at his or her local level. I think that it is something that requires the ability of the local forces to carry it out. In other words, it is something that is very important to be done in co-operation with local forces because they have to have the personnel and the storage facilities to receive the firearms. There is nothing to prevent chiefs of police from doing this. In fact, I believe that the Ottawa Chief of Police has done this unilaterally. I would encourage all chiefs of police to use their authority to do so.


Derek Vincent Lee: I have a supplementary question, Mr. Speaker. I would like the minister to try to firm up her government's intentions in this regard.
In early October, a spokesman in the minister's office suggested in a published report that nothing would be done on an official gun amnesty until after passage of the GST. I do not really understand that attitude. Maybe the minister wants to tax the guns when they are turned in.
Will the minister proceed now by statute or by Order in Council? What else is preventing her from moving right now to get these unwanted and dangerous guns off the street?


A. Kim Campbell: Mr. Speaker, with all due respect I would suggest that the hon. member is incorrect when he quotes a member of my staff or anyone speaking on my behalf in saying that. He is quite wrong. The two things are quite unrelated.

November 6, 1990
Oral Questions
I point out again that I have the legislative jurisdiction to amend the Criminal Code. I do not have the jurisdiction to enforce the Criminal Code. Because I lack the legislative jurisdiction to create a country-wide amnesty, I cannot do so. I am not going to introduce a special statute to do so.
As I said, I am in consultation with my provincial counterparts to determine whether it would be appropriate to have a national amnesty. I look to the hon. member's support of that effort.


CITIZENS' FORUM ON CANADA'S FUTURE
Mr. Jack Iyerak Anawak (Nunatsiaq):: Mr. Speaker, in the absence of the Prime Minister, my question is directed to the Deputy Prime Minister.
Despite the fact that northern Canada covers one-third of Canada's land mass and has a constitutional, political, and legal status which is unique in the country, the northern territories do not have a representative on the Citizens' Forum on Canada's Future.
I would like to quote, in part, a letter written by the government leader of the Northwest Territories to the Prime Minister on November 2. It states in part:
I sincerely believe that a prominent Territorial resident would bring a unique perspective to the Forum's deliberations,-and provide some comfort to the Territorial governments and residents that they have a voice and a part to play at the national level.
Since the chairperson of the Forum recognizes all of the above by going to Tuktoyaktuk and Inuvik this weekend, and since the Prime Minister on the weekend said he is open to additional appointments, will the Deputy Prime Minister ask the Prime Minister to name a northern Canadian to the forum?


Donald Frank Mazankowski: Mr. Speaker, what the forum will be interested in-I am sure what all Canadians will be interested in-are the views of northerners on this very important subject.
As I said to the House yesterday, the members of the panel are not intended to act as representatives of any one group, any one region, or any one occupation. What they are there to do is to facilitate the dialogue and to
encourage Canadians to talk to each other and to present their views to the panel. In that way we can hope to develop a consensus as to the values and what we want in terms of constitutional and institutional change, and how we might plot a course for a stronger, united Canada.


Ms. Ethel Blondin (Western Arctic):: Mr. Speaker, my supplementary is directed to the Deputy Prime Minister.
The answer that was given is totally unacceptable.
Perhaps there is no substitute for the kind of positive	;
contribution that a real northern Canadian person could	|
make to that particular forum. It does not substitute to have a few forays made into the north.
Along the same lines, why did the Senate government leader state this past weekend that questions regarding aboriginal issues are futile to look at in that it would distract from the more fundamental exercise? The rights of first citizens must have been considered pretty fundamental when the Prime Minister made promises on September 25.
What are the government's plans to resolve the constitutional matters facing Canada's aboriginal people outside the citizens' forum, especially since this forum is not an acceptable substitute for direct action by the government?


Some hon. members:: Hear, hear.


Donald Frank Mazankowski: Mr. Speaker, I cannot think of a better contribution that could be made by anyone than that of the two hon. members who represent the northern part of Canada. I think they are very-


Ethel Dorothy Blondin-Andrew: It's not good enough.


Donald Frank Mazankowski: The hon. member says that is not good enough. The hon. members are very eloquent and knowledgeable about the issues and I would think that the forum and all Canadians-


Ethel Dorothy Blondin-Andrew: Don't be so condescending.


Donald Frank Mazankowski: Mr. Speaker, she suggests that I am being condescending, but far from it. I am trying to be complimentary as I have no difficulty in being complimentary to the tremendous contributions the hon. mem-
November 6, 1990

ber makes to the House on behalf of the people she represents.
I can also say to her that one of the members of the forum, Carol Corcoran, is from northeastern British Columbia, Fort Nelson, and has, I understand, extensive links to the Yukon and the Northwest Territories.


Some hon. members:: Hear, hear.


SOFTWOOD LUMBER
Mr. Brian L. Gardiner (Prince George-Bulkley Valley):: Mr. Speaker, news reports over the weekend are quoting officials from the U.S. government saying that they have no intention of changing the softwood lumber tariff that is wreaking havoc in the forest industry, especially in British Columbia and northern Ontario. Thousands of jobs are being lost.
My question is directed to the Secretary of State for External Affairs. Since 1986 when the tariff came in, the U.S. government has issued some 64 directives to the Canadian government regarding this tariff. Will the minister table those documents in the House so that we can establish once and for all the extent of U.S. domination of our forest policy since this government signed away our right to manage our forests ourselves?


Some hon. members:: Hear, hear.


Right Hon. Joe Clark (Secretary of State for External Affairs):: Mr. Speaker, the hon. member knows that this arrangement arose from problems that had their root in stumpage practices in his province and others across the country. He should not try to confuse people about the history of the problem or the way in which it was resolved.
He is asking a question about a technical matter of tabling documents. He has been in the House long enough to know that if he wants an answer to a question of that kind which requires some notice, he should indicate his interest rather than raising it here.
I will look into the matter and, if the practices of the House would make it appropriate for those documents to be tabled, then we will proceed that way.


Brian L. Gardiner: Mr. Speaker, in fact, I did that back on October 16 and this minister's own department has received some
Oral Questions
64 directives from the U.S. government on the softwood lumber tariff. I take it from the minister that he will in fact provide those documents to the House.
My supplementary question, then, is this. Given the high interest rate policy of the government and its destructive policies as they relate to the forest industry, and given that the United States is clearly not listening to this government when it comes to its half-hearted attempts to change this tariff will the minister use Section 9 of the memorandum of understanding and terminate this agreement immediately?


Some hon. members:: Hear, hear.
Right Hon. Joe Clark (Secretary of State for External
Affairs): Mr. Speaker, the NDP are the great terminators, except when it comes to having to stand up on any kind of- Now I am being lectured by the House Leader of the New Democratic Party. Maybe he wants to cross the floor again.


Some hon. members:: Oh, oh.


Charles Joseph Clark: As I understand what the hon. member was saying, he was asking me if I would table a list of documents. When I told him he would be more likely to have a response to that question if he gave notice to me, he indicated that what he in fact had done before on the Order Paper was ask for a list of submissions that might have been made by the Government of the United States to the Government of Canada. It is one thing to ask for a list and another thing to ask for a document to be tabled.
I repeat my undertaking to him. I will see what the practices are. If the practices lead to the tabling of that document, then we will naturally follow those.
If his House leader intends to cross the floor again, or to offer that, I hope that-


Some hon. members:: Oh, oh.


Mr. Speaker:: The hon. member for Moncton.


GOODS AND SERVICES TAX
George Saunders Rideout: Mr. Speaker, my question is directed to the Minister of Finance. The GST leaves retail co-operatives at a decided disadvantage. All contributions to share equity of co-operatives will be taxed; not so with their competitors. Services provided to

Oral Questions
local co-operatives by parent co-operatives will be taxed; not so with similar retail businesses.
The minister recognized these errors with respect to banks and credit unions and corrected them. Why will the minister not correct the flaws and inequities in the GST as they relate to retail co-operatives?


Michael Holcombe Wilson: Mr. Speaker, I think the hon. member understands that it is very, very late in the legislative process. This is a matter, if he had raised it earlier, we might have been able to have a look at.
I think the hon. member must realize-


Mr. Manley:: They would not change anything.


Michael Holcombe Wilson: The member from Ottawa says that we would not change anything. We have changed a number of things during the course of the legislative process. There are a number of changes that were proposed by the committee of which he is a member, the finance committee of the House of Commons. On December 19 of this year I announced a number of changes in relation to the tax.
It is important for the hon. member to get up and speak in his caucus and tell his leader, the Hon. Jean Chretien, that it is important now that he should be giving the orders and that Allan MacEachen should not be giving the orders.


Some hon. members:: Hear, hear.


George Saunders Rideout: Mr. Speaker, this party supports our leader in instructing the Senate to fight the GST and seeing that it is killed.


Some hon. members:: Hear, hear.


George Saunders Rideout: Co-op Atlantic, the largest co-operative in Atlantic Canada has determined that the effects of this flawed GST will give its competition a $1.3 million a year advantage. For six months, the co-operatives have been attempting to meet with the government and remedy these inequities, all to no avail. Co-op Atlantic has now publicly supported the Senate in its fight to kill the GST. Retail co-operatives have been shuffled from one government department to the other.
When is the government going to address their concerns and remove the flawed GST?


Some hon. members:: Hear, hear.


Michael Holcombe Wilson: Mr. Speaker, when the hon. member said that his party supported the leader, I noticed that there was only scattered applause.


Some hon. members:: Hear, hear.


Michael Holcombe Wilson: Mr. Speaker, was that for Jean Chretien or Allan MacEachen?


An hon. member:: They used to do that for John
Turner.


Some hon. members:: Oh, oh.


Mr. Speaker:: The hon. member for Jonquiere.


COMMUNICATIONS
Mr. Jean-Pierre Blackburn (Jonquiere):: Mr. Speaker, my question is directed to the Parliamentary Secretary to the Minister of Communications. Hon. members are aware how important it is to Francophone members to have a French news channel that will serve all Francophones in this country.
One amendment to Bill C-40, the proposed broadcasting legislation, would oblige the Canadian Broadcasting Corporation to offer this service to Francophones and Anglophones alike.
My question is this: is our government favourable to this idea and does it support establishing a news channel for Francophones?


Mr. Jim Edwards (Parliamentary Secretary to Minister of Communications):: Mr. Speaker, the government is aware and conscious of the fact that the establishment of 24-hour French news service is of great interest to the French-speaking population of Canada.
Since last year when the CRTC rejected their request for a 24-hour French news service, Radio-Canada management have been working on a new application which will take into consideration the objections raised by the CRTC.
I believe that Radio-Canada is about to file a revised application, but no decison has been made about the date when the new request is to be submitted.
November 6, 1990

The task force looking into the economic situation of Canadian broadcasting will examine the capacity of Canada's broadcasting network to accommodate new services, including specialized services.


Mr. Speaker:: The hon. member for Megantic-Compton-Stanstead, only one question, please.


QUEBEC'S RIGHT TO SELF-DETERMINATION
Mr. Francois Germ (Megantic-Compton-Stanstead):: In the absence of the Prime Minister, Mr. Speaker, I direct my question to the Deputy Prime Minister.
We all know that in Quebec City today the Belanger-Campeau Commission began its hearings on the constitutional future of the province. We also know the answer given by the Deputy Prime Minister to a question I raised in this House on June 28 concerning Quebec's right to self-determination, and we know the answers given yesterday to the same question. Does the Government of Canada recognize that Quebecers are free to decide their future, to determine their political status, and to plan for their economic, social and cultural development?


Donald Frank Mazankowski: Mr. Speaker, as my colleague, the Minister of Industry, Science and Technology indicated in the House yesterday, this is a resolution that was brought forth by the Quebec wing of the Conservative Party of Canada.
Resolutions come forth in this manner from time to time from various regions of the country. As a matter of fact, there are regional policy conferences going on throughout the country and there will be a national policy conference that will take place in 1991. At that time, any policy initiatives or resolutions will be considered to the fullest extent. That is the normal process for a political party to function. If the hon. member wants an invitation as an observer to come to that conference, I will see that it is arranged for him.
Government Orders AGRICULTURE


Mrs. Louise Feltham (Wild Rose):: Mr. Speaker, my question is for the Minister of Agriculture. Last February 26 the minister and the U.S. Secretary of Agriculture reached an agreement which will experiment with a harmonized systems of standards for meat and poultry inspection.
Can the minister apprise the House of what progress has been made with respect to this matter?


Donald Frank Mazankowski: Mr. Speaker, that is true; there was an undertaking by the Secretary of Agriculture for the United States and myself to try to work toward a harmonized system of border inspection based upon the equivalency of two inspection systems. There is obviously a process it has to go through. We were able to initiate that change through regulation.
In the case of the United States, it has to go through a public hearing process. There are a number of interested groups that wanted to appear to make comment on this proposal. That is still being undertaken, but I can assure the hon. member that the resolve to move toward this kind of an arrangement is very strong and the commitment is fully there, on both sides of the border. I hope that, after the success of going through the process, we will be able to implement a temporary measure which hopefully will become a permanent measure.



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[Stage Direction]
[Translation)

[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.
The Acting Speaker (Mr. DeBlois):: When the House took recess at 1 p.m, there were five minutes left for questions and comments following the speech by the

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hon. member for Moncton. I will now recognize hon. members who wish to continue the period for questions and comments. The hon. member for Etobicoke North.


Hon. Roy MacLaren (Etobicoke North):: Mr. Speaker, the bill before us today embodies a subject which has long been of concern, both to the government in office during the early 1980s and the one in office through the latter part of this decade. More generally, it is a bill that should be of interest to all because of its central importance to our future economic growth. Our ability to muster and to direct our savings into productive uses depends directly on our ability to structure our financial institutions in such a way as to ensure both efficiency and probity. The key words in financial institution legislation which we have before us today must be solvency-


The Acting Speaker (Mr. DeBlois):: Order, please! I would ask all hon. members to co-operate with the Chair and carry on their private conversations outside the House.
I may also remind the hon. member for Etobicoke North that we are still in the period for questions and comments, since we have not yet resumed debate.


Roy MacLaren: Mr. Speaker, I had not noticed that there were any questions or comments. I was responding to the introduction of the subject again. If there are any questions, I should of course be prepared to cede the floor and to continue whenever you are ready.


The Acting Speaker (Mr. DeBlois):: Resuming debate. The hon. member for Etobicoke North.


Roy MacLaren: As I was saying, Mr. Speaker, the question of financial institutions raises basically the problems of solvency, the concerns about probity, the question of competition and, finally, the need for national control and ownership.
The way that Canada orders its financial institutions and markets to a surprisingly large extent influences the way that we order our national objectives. "By following the money flows in the market economy", one observer has noted, "and dissecting the institutions that structure
that flow, we can learn a great deal about the uses to which the society's resources are put, by whom, and how control is obtained and exerted." That is, in a sense, what we are doing today. We are discussing a fundamental question concerning the future of our country. It is that question that I wish to address today.
Allow me to begin with a question. How can our financial institutions best respond to the growing internationalization of markets and, more specifically, to the likely takeovers that will threaten Canadian control of its technology as well as its commercial and financial resources?
Over the years we have seen a variety of pressures for change arise in the Canadian economy that have led to the development of the legislation that is before us today. One of the principal forces that has made for change in financial institutions is inflation. The volatility of interest rates has led to shortening of the terms of both assets and liabilities in Canada, so as to reduce thereby the risks of borrowing at short term and lending at long term.
Over a period of time, with the shortening of terms of lending in Canada, institutions formerly active in longterm instruments have sought out increasingly shortterm funds. They have sought a better matching of their obligations and of their assets. That has led to a crowding in the short-term intermediation of financial dealings. It has contributed directly to the blurring of the four institutions that we have traditionally recognized in Canada; the brokerage houses, the banks, the insurance companies and the trust companies. That blurring of institutions has in turn led to increasing problems of regulation. Obviously, if institutions become blurred, more indistinct than they traditionally have been, problems of regulation arise.
Equally, when we recognized in Canada some years ago the necessity of increasing deposit insurance, one result was that trust companies had their way opened to participate yet more actively in the total area of financial intermediation. The Bank Act revisions of 1954 and 1967 only increased the blurring of distinctions among the so-called four pillars of the financial world by allowing the banks first into consumer loans and subsequently into mortgages.
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The result of this has been that the banks have become increasingly active in areas that had hitherto been the preserve of trust companies. Equally, as I mentioned, as a result of increased deposit insurance, the trust companies have become more and more active in deposit taking, an area that had traditionally been the preserve of our chartered banks.
Yet more recently, we have seen the entry of banks into the brokerage business. A few years ago the government, partly in response to an initiative taken by a chartered bank, enabled the banks not only to enter into the brokerage business, but to acquire the assets of brokerage companies. The consequence is that today there are, in effect, no major independent brokerage houses. That fourth pillar of our traditional financial community has now disappeared, in the sense of being an independent or stand alone entity.
Also, Mr. Speaker, over the years we have seen regulatory change leading to pressures for further regulatory change. You begin to change one regulation and you find soon that you must respond to other changes that are demanded as a result of the first change you made. So we have pressures from the mere fact that over a period of decades Canada changed its regulation of financial institutions, but that has led in turn to yet more demands for change.
The parallel to that has been that the provinces' increased activity in financial regulation. The provinces have been more active in their imaginative approaches to financial intermediation, both with regard to deposittaking institutions, that is trust companies, banks and co-operatives, and in the regulation of insurance and other financial activities which were traditionally the preserve of the federal government.
Another factor that has made for increased blurring of distinctions among financial institutions and, hence, increased the pressures for a re-examination of the regulation of financial institutions has been the globalization of financial companies.
We have seen the changes that have been introduced in other countries leading to pressures for change in Canada. I speak not merely of the United States, although the implications of the free trade agreement for financial institutions are many, but also of recent initiatives in Europe which have had the effect of
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reducing the distinctions among financial institutions. This in turn has contributed to similar pressures in Canada so that Canadian financial institutions can compete internationally on what has been called a level playing field.
I spoke of solvency being one of the primary concerns. Today it remains a concern that all our financial institutions serving the public can guarantee their solvency through good business practices but this leads to the yet more basic question of whether banks should be regulated. The essence of that question is: Do you regulate institutions when institutions are becoming increasingly indistinct, or do you regulate the activity itself? The legislation we have before us today chooses to go mainly along that second route.
We have also seen the standards of competition and efficiency being applied to our financial institutions in terms of whether they are internationally competitive. We have seen questions arise of whether there are more possibilities of conflict of interest in the growing combination of financial institutions. We have seen concern expressed increasingly and, most recently, in the case of the entry of Amex into Canadian banking, about the role of foreign corporations in what hitherto has been largely a Canadian dominated industry.
There is yet a more fundamental question. The relative importance of direct financing through equity markets has declined over the years. There has been greater reliance on financial intermediation through credit from financial institutions such as banks and trust companies. That trend has been increasing. We also saw in Canada a rapid growth in demand in the 1980s for consumer and mortgage loans and a shift by non-financial corporations away from bond and equity financing to bank loans. As I have already noted, the increased level and volatility of inflation and interest rate uncertainty led both borrowers and lenders to turn to shorter term liabilities and assets, providing trust and loan companies with a new competitive niche in the total lending market.
Legislative changes have led to increased competition across traditional institutional lines. The lowering of reserve requirements on banks' term deposits and the removal of ceilings on bank loan rates improved their ability to compete for term deposits. The increased competition in deposit markets forced financial institutions to extend and diversify their range of services.

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As I noted a moment ago, all these and other factors, have led to the situation today where Canadians must ask themselves-and the government has raised the question directly by tabling its legislation-which route, and they are not necessarily exclusive, Canada wants to follow with regard to our financial institutions. If the goal is indeed deregulation of financial institutions, we can move toward commercial links. That is to say, through legislation, the government can permit companies to hold upstream financial institutions. You can then have in Canada, as we have seen developing in the last years, a commercial company holding upstream the ownership of a financial institution. That is a relatively new feature of the Canadian financial scene and one which this legislation, to a degree, attempts to address.
The alternative, and again I say it is not necessarily mutually exclusive, is the financial link approach. That is to say, the government can permit downstream holdings of commercial entities by financial institutions, principally the banks. As a result, if the banks were permitted to engage in activities and hold equity in commercial corporations, as they so frequently do in Europe and Japan, then Canada would obviously emerge with institutions not unlike the so-called "universal banks" of Europe.
The merit of such an approach, in the eyes of some, is that it would help guarantee Canadian ownership, not only of our principal financial institutions but also of manufacturing or service industries generally. On the other hand, the price that concerns others is the lack of competition to which that could give rise. The result could be larger and larger Canadian conglomerates, bringing with them misgivings about the limited degree of competition within our economy.
The creation of financial links, that is Canadian banks or trust companies holding equity in commercial corporations, could be argued to be in Canada's basic national interest. The government would then presumably need to consider a type of financial regulation whereby widely held financial institutions, which are at present only the chartered banks, limited as they are to 10 per cent ownership by any one entity, could enter the commercial sector.
Financial links along such lines would undoubtedly ease the evolution toward a credit based rather than a market based financial system. That is to say, commercial entities within our country would seek their financing more from financial institutions than they would from the equity marketplace. Not only would such a trend be compatible with the general thrust of the evolution of money markets world-wide, but it could also give Canada a more long-range and stable element in industrial planning.
Most important, by permitting financial links the government could be instituting one means of keeping Canadian assets in Canadian hands. If the concern among Canadians is that many Canadian assets have for past decades been moving gradually out of Canadian control, then banks, which are by definition widely held, could be a vehicle whereby Canadians could retain a controlling interest in a Canadian commercial institution, rendering it virtually takeover-proof by foreign interests.
Against that speculative background, I want to speak for a moment more about the legislation before us today, recognizing that its emphasis is to take Canada's financial institutions in a direction rather different from that which I have just touched upon. The bill empowers trust companies to a point where in many respects they will be able to compete yet more effectively and pervasively with banks. Well capitalized trust companies will have full consumer and commercial lending powers for the first time, putting them on virtually the same level as our banks.
I believe that it is clause 400 in the legislation that removes the present quality tests and substitutes instead a requirement that a company's investment adhere to a prudent portfolio standard. There is, however, no limit on consumer loans under $250,000 made to individuals. Similarly, subject to the approval of the Superintendent of Financial Institutions, companies with more than $25 million in capital will be free of any restrictions on commercial lending.
The bill permits trust and loan companies to engage in a limited range of non-financial services for the first time or extends their ability to engage in such services: real property management, promotion of goods and services to credit card holders, selling lottery and even urban transit tickets. The principal extension in this bill is opening the way for deposit taking institutions to enter the life insurance business. Here of course is a major
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change, a major erosion of the four pillars that we have traditionally known in Canadian financial institutions. For the first time, the possibility is that Canadian deposit taking institutions will be able to participate directly in the insurance business.
The question that I would raise here is: What studies has the government prepared? What has it done in the way of examining the results of insurance companies being in the hands of the deposit taking institutions?
I hope the government would table whatever work it has done in this area, because I have an uneasy feeling that it is not very much. All Canadians would benefit if we could see more information about what work the government has done to determine the public interest in insurance companies being opened to ownership by financial institutions.
I realize that my time is running out. I only want to say in conclusion that the trust companies bill which we have before us also raises the question of limitations of ownership. The banks are subjected to a 10 per cent ownership limit. This bill, however, confirms that commercial entities can own trust companies up to a level of 65 per cent; 35 per cent must be held more widely.
Whether in the view of the Canadian public this is an adequate guarantee of their interests in ensuring probity and good business practices in financial institutions remains a question for further debate in committee. It is a question which will arise again when the next Bank Act revision comes before the House, and indeed when the revisions to the Life Insurance Act come before this House, two further occasions that will give rise to the sort of discussions we are having today. Indeed, until then the present legislation, even if adopted at an early date, will not become effective. I look forward to further discussions on those occasions.


John R. Rodriguez: Mr. Speaker, I wonder if the member would comment on this particular question. In this bill we have a situation where, as a result of the free trade agreement, Schedule II banks from the United States can come into Canada and do all the things that Schedule A banks can do, that our banks can do. Yet they are not bound by the 10 per cent ownership rule.
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Does the member feel that this is an acceptable treatment of a foreigner, treating them one way, which is different from the way the Canadian would be treated?


Roy MacLaren: Mr. Speaker, the hon. member does indeed put his finger on a major policy flaw in the government's approach to financial institutions. The tip of the iceberg was the approval of the Amex Bank entry into Canada. Here we have a foreign institution, which is not primarily a bank in its domestic jurisdiction, being permitted to act as a bank in Canada when Canadians are denied a similar opportunity.
Whether you think that the commercial entities in Canada should be permitted to own banks is another question, but it remains a remarkable anomaly, not to say a bizarre anomaly, that you permit a foreign non-bank to be a bank in Canada.
I agree with the hon. member that the free trade agreement provisions, whereby Canada has opened the way for American financial activity in Canada to a degree which Canadians do not have in the United States, is patently unfair.
What the government did in the free trade agreement was to offer American financial institutions so-called national treatment in return for the United States offering Canadian financial institutions national treatment in the United States. However, the difference is that in the United States the banks are state regulated, whereas in Canada banks are federally regulated. The result is that American financial institutions are able to participate on a national level in Canada, whereas a Canadian financial institution is restricted, with some qualification, to one state.
I would have thought-and I am sure that the hon. member would agree-that the government, in the free trade agreement, should not have sought national treatment but rather sought greater reciprocity so that Canadian financial institutions operating in the United States could have comparable opportunities to those that American financial institutions do in Canada.
I think the point is quite well taken, but it should be directed to the government.

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John R. Rodriguez: Mr. Speaker, because the hon. member is so knowledgeable in this field, I thought I should follow up with a supplementary question.
Since I know he has read this bill and is familiar with it, is it not possible under this bill-here is where the thing gets even more ludicrous-that a Canadian with lots of bucks can actually go into the United States, buy a bank and then bring that bank into Canada as a Schedule II bank and do all the things that our banks do here, and yet avoid the ownership rule? Is it not possible?


Roy MacLaren: Mr. Speaker, I do not know whether there are any regulations that would prevent a Canadian citizen from doing that. It is one more anomaly that we have gotten ourselves into not only through our own legislation but also through the free trade agreement with the United States.
The opportunity for the hon. member, myself or for anyone interested in this question-all Canadians should be-to raise it again will occur when the decennial Bank Act is brought before this House.
Recently the government acted to extend for one year the Bank Act beyond its normal decennial period. Whether we shall have that opportunity for further debate before the government changes, I do not know. It is yet another example of the inconsistency of our approach to foreign ownership of Canadian financial institutions.
The hon. member is probably quite right. I suppose on the face of it, there is no reason why, if a well-financed Canadian could buy a U.S. bank, he or she could not come back into Canada as a foreign bank operating in Canada, and do things that he or she, as a Canadian, could not do.


The Acting Speaker (Mr. DeBIois):: 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 Saint-Laurent-Cartierville-Visible Minorities; the hon. member for Timmins-Chapleau-Unemployment Insurance; and finally the hon. member for Saint-Leonard-The Economy.


Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, we have the first piece of legislation in front of us with Bill C-83 which makes up the government's package of financial deregulation measures.
This is a package which will include action not just with respect to trust and loan institutions, but also with respect to banks, insurance companies, extension of the Bank Act and a number of other financial institutions which have been of concern to business people. It is not just the business people but communities across this country that have been looking for this package of reforms to our financial institutions for some time.
My own suspicion is that this first piece of legislation is, in fact, put before us in a form which will not in the final analysis represent what the government wishes to have considered for reform in terms of trust and loan companies.
I suspect myself that this has been brought forward in a sense as a promise to financial circles within the country that the government is acting in this area where it has not seemed to be taking action very quickly. We will, in fact, see a package which will include a similar approach to the different financial institutions which will probably include a revised piece of legislation with respect to trust and loan companies.
However, I think that the broad direction which the government is taking with respect to financial institutional reform is fairly clear to see. It is a direction which was set out by the junior finance minister in his comments when this bill was introduced. It is an approach which we have discussed in the finance committee of the House in somewhat more detail in the context of briefings which have been given to us by representatives from the Department of Finance.
The key thrusts of the government's new approach, as the minister laid them out and as they seem to be reflected in the briefings that we have received are, first, that we shall see some quite different ownership rules for financial institutions. There will be a good deal of loosening up of the constraints which have existed in the past, as far as ownership constraints are concerned. We will see, for instance, a loosening up with respect to the involvement of foreigners within our country. We will see, as a consequence of the free trade deal which my colleague mentioned earlier, that United States financial
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institutions are treated virtually as if they were Canadian financial institutions. That is going to be one set of new directions.
The second set of new directions is to reduce the barriers which have existed in the past among the various financial institutions in this country. It has not been possible, for instance, for insurance companies to have investments in banks in the past. It has not been possible for banks to have investments in insurance companies. Similarly, trust and loan companies have been given certain specific tasks which they could undertake and they have been told that they could not extend their ownership to other forms of financial institutions, such as securities houses, such as insurance companies and banks. So that is going to change.
Third, there is going to be a set of what the government calls improved prudential rules. What, in fact, are improved prudential rules? They are, essentially, an approach which, as I read it, puts much more self-policing power in the hands of financial institutions themselves. Financial institutions are given the authority and the responsibility to make certain that there is no internal self-dealing. They are given the responsibility to see to it that, for instance, if there is cross-ownership, that that cross-ownership of other financial institutions does not lead to special, competitive advantages as a consequence. I have to say that this self-policing approach is something which we look at with considerable scepticism. Frankly, we are not prepared to condemn it outright at this point, but we will ask some very tough questions as this reform of financial institutions goes forward, because we think it represents an area of serious risk for this country and for the people who put their investments in the various financial institutions.
Finally, the government says that this is an attempt to modernize the company rules which exist for the various financial institutions. By and large, that is not something that provides special difficulties for us. This particular legislation has not been changed since the beginning of the First World War. There are all sorts of potential areas for modernization of company legislation which should be applied to this financial area of jurisdiction within our economy.
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That is the government's approach. What about the Liberal Party's approach? You might have thought from listening to the last speaker, who is the trade critic for the Liberal Party that, in fact, the Liberal Party had considerable doubts and was raising considerable questions about this piece of legislation. In fact, the critic responsible for financial institutions for the Liberal Party made it very clear in her comments, when she started debate on behalf of the Liberals, that the Liberal Party favours this piece of legislation.
It is especially interesting to see why this deregulation was favoured by the Liberal Party.


Joseph Frank (Joe) Fontana: Tell us about your program of nationalizing banks.


Steven W. Langdon: We are coming to my program. Do not worry about that. Do not be sensitive. You should be proud of the position which your critic took. The Liberal Party's critic said they favour this bill because globalization is taking place, that world globalization was a new reality, and because of globalization, it is necessary to help Canadian financial institutions to meet tougher competition. That is precisely the sort of message which the government itself sent. So in the crucial area of economic management, as in so many important areas, one finds that the Liberal Party and the Conservative Party stand for essentially the same thing. They both support the deregulation of financial institutions. They both support it for essentially the same reason; because there is globalization taking place and our financial institutions have to become tougher and stronger and have to be better able to fight the rest of the world.
Let me make some points about this approach from both the Conservatives and the Liberals. We should not be prepared to permit the two business-oriented parties in the House of Commons simply to rewrite legislation without a quarrel, without being challenged when that legislation is, in fact, going to be so detrimental, in our view, to many consumers across this country.
Let me suggest, that it is important, for instance, to look very carefully at the fact that since 1980, in less than 10 years, 23 trust and loan companies in the country have been federally chartered. In addition, since 1980, a great number of trust companies have collapsed.

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I could go through the list of some of the larger ones just to demonstrate it. The Crown Trust Company collapsed with an estimated loss of $930 million; Fidelity Trust, $791 million; Greymac Trust Company, $240 million; Seaway Trust, $300 million; Pioneer Trust, $201 million; the Columbia Trust, $99 million; the Northwest Trust Company, which collapsed just in 1987, $275 million; and finally, perhaps the most scandalous case of all, the Principal Savings and Trust Company, which collapsed in 1987 with losses of $116 million.
With these kinds of disasters which our trust and loan companies have suffered in recent years, it is not good enough to stand up and say: "We support this legislation", as the Liberals have done. It is not good enough, as the Conservatives have done, to bring forth legislation which leaves it to self-policing to see to it that things will work out well in the future for those who invest in our trust companies.
We also see within this bill absolutely nothing with respect to disclosure of the various service charges of trust and loan companies. In the case of banks, the government says it is going to enforce such disclosure of service payments. But in the case of trust and loan companies, despite quite ambiguous legal advice, the government is not prepared to take the chance, despite the fact that trust and loan companies compete directly against chartered banks in the country. Again, it is not good enough on the part of the Liberals and the Conservatives to say this is an answer, when there is nothing in here about disclosure of service charges.
It seems to us quite clear that this legislation is set up in such a way as to assist financial institutions to take each other over, but to prevent those financial institutions from all-out competition with each other. In other words, this is a bill designed to see to it that the financial institutions involved in this bill have their cake and get to eat it too.
In short, this legislation is going to establish, without question, greater financial monopoly throughout the country. It will not be with this piece of legislation alone, but it will be with the whole package of financial deregulation which the Conservatives are putting into effect and which, so far, the Liberals are supporting. We are going to see greater monopoly control.
We are also going to see a situation established in which all-out competition is not possible. It will not be possible in this approach by the Conservatives and Liberals for financial institutions to compete with each other. In their support for this legislation, we are getting from the Liberals and Conservatives the worst of all possible worlds. Therefore, we intend to oppose this piece of legislation. We intend to raise very tough questions in committee and we intend to see to it that this legislation is given the kind of scrutiny which eventually gives Canadian consumers across the country a sense of real competition amongst their financial institutions.
We also intend to see to it that there is real security given to those people who invest in our banks and our trust and loan companies so that we do not have, as we have had since 1980, a total of almost $5 billion in losses on the part of our banks and our trust and loan companies. Consumers deserve competition to give them protection and investors deserve serious regulation to give them protection as well.


Giuseppe (Joseph) Volpe: Mr. Speaker, I was quite impressed by the ability of our debator to wait until the last 30 seconds to give us an opportunity to understand the issues that he wanted to address in the debate. I am impressed that he was able to repeat what members from my caucus, over the course of the debate on Bill C-83, have indicated are very essential elements of rectifying the legislation before us. That is, ensuring that there is security of deposits for depositors, that there is better service available to those who are going to be dependent on the financial service sector, and that there will be an opportunity to enhance the ability of all those pillars to compete on the domestic front and on the international front.
One of the questions I would ask the hon. member for Essex-Windsor this. Does he not think that it diminishes the import of those very basic and solid principles by distracting not only the House, but all those who would want to understand better the flow of debate on this very important legislation? He has trivialized the discussion and made references to incomplete statements that he picks and chooses from debate of members on both sides of the House.
His major concern with respect to this legislation is not that we can bring it forward to committee, analyse it, dissect it, critique it, and bring forward the appropriate amendments to make it something that Canadians can feel comfortable with. In fact, his big concern is that the

Liberal Party has made the kind of recommendations that cause him some consternation and, in fact, that the Liberal Party might be in a position to present the kinds of amendments that he would so dearly love to support.


Steven W. Langdon: Mr. Speaker, the Liberals get themselves into this problem so often. Their official position before they start debate is that they support the bill. They think it is a good thing, and it is because of international competition. Their critic gets up and says so. We get up and make our criticisms and comments, as my colleague who is responsible for financial institutions made in his original speech. Then the Liberals start to back-track and say: "Gee, we forgot about some key elements here. We had better flip through this bill really carefully and see if Rodriguez was right." In fact of course, as usual, my colleague from Nickel Belt was right, because he and I have been at the finance committee. We have been working quite hard trying, right from the ground up, to improve the approach that the government has taken.
I certainly hope very much that the Liberals will come forward and make some amendments. Frankly, they have put themselves in a difficult position through the fact that their critic got up and said that they favoured this bill. In favouring this bill, they make it quite clear that, as I suggested in my comments, the parties that are oriented to big business in the country both feel supportive of this legislation.
Well, we make no apologies for not being supportive of this bill. Our critic said that when he got up to speak and it has been the position of our caucus right from our analysis of the bill itself.
If it is possible to improve the bill in committee, of course that is useful. As I suggested and as the trade critic of the Liberal Party agreed, this piece of legislation before us is in all probability just a stalking horse. It is just a preliminary piece of legislation to tell the financial community: "Don't worry, guys. There is something coming that will cover the whole range of institutions."
Let us talk about the whole range of institutions. Let us see to it that we get it right. Let us not accept a faulty
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approach which is going to leave consumers unprotected and those who invest in these institutions without the security which good solid regulation would give them. That is why we are against this bill and we will fight it at this stage of second reading.


John R. Rodriguez: Mr. Speaker, after listening to my colleague present such an excellent expose of the bill and, of course, clearly repeating the line that the New Democratic Party has taken about its concerns on Bill C-83, I want to ask him this particular question.
In this bill the government is finally going to put into effect regulations, rules, a law concerning bank service charges. Lo and behold, trust and loan companies are going to be allowed to act and perform like banks. Yet, Bill C-83 is unable to impose on trust and loan companies such a pussy-cat proposal as envisaged in Bill C-9 on the trust and loan companies. The government is using weasel words like: "Well, we can't impose these bank service charge rules on trust and loan companies because they are in another jurisdiction."
What confidence does that inspire in consumers? In fact, trust companies and loan companies can draw on the CDIC, which is the Canada Deposit Insurance Corporation. Most of those who have drawn from that have been trust companies because those are the ones that have gone belly up. Yet, we cannot say to trust companies: "You jolly well will be subject to the bank service charges legislation if you want to continue to participate in the CDIC." Where is the logic?


An hon. member:: There is none.


Steven W. Langdon: Mr. Speaker, I think that my colleague has picked up an important point which both he and I made earlier in our speeches.
That is both the Conservatives and the Liberals are supporting legislation which does not follow any logic. There is a complete lack of logic to say that banks and trust and loan companies on the one hand should be able to compete better against each other and they should be able to buy each other out to a certain degree.

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Yet, on the other hand, to say we will have disclosure rules with respect to service charges or banks, but we will not have disclosure rules with respect to trust and loan companies, is illogical.
It is even more illogical than that because the government has seen fit to say that it will enforce disclosure rules with respect to interest rates on the trust and loan companies. It will not enforce those disclosure rules on what are often substitutes for interest levies, that is the service charges which trust and loan companies levy just as banks levy.
There has to be a logic to this legislation if it is to be accepted by this House and by this country. Otherwise, we will see more and more bank, loan and trust company collapses of the kind that this government across the aisle has seen take place under its jurisdiction and which the Liberals saw take place under their jurisdiction prior to 1984.


Mr. Bill Blaikie (Winnipeg Transcona):: Mr. Speaker, I thank the hon. members across the way for this tremendous vote of confidence which they just gave me, all two of them.
It is interesting that we should be talking partly about bank service charges because I just said to the hon. member for Nickel Belt that the way the banks are going, you can hardly walk by the outside of a bank these days without having a service charge debited to your account.
I grew up at a time when we still believed, at least the popular mythology was, that the banks were there to serve the public. There were these respectable dour institutions that Stephen Leacock made famous and which was later turned into an animated film of people going into the bank and being very respectful.
Now, of course, those of us who still go in and tiy to have some genuine human relationship instead of going to a machine are forced to pay for every time that we do this. Of course, they will set up a chequing account and then you are not charged for writing cheques, but you are charged for the cheques.
In the end, what it amounts to is that somehow they get you. Somehow you are paying for everything that allegedly the bank is doing for you. You are in fact paying for it.
In my riding, there was a branch of the Toronto-Domi-nion Bank at the Kern Park Shopping Centre which served the entire east end of Transcona. It was there for years, since the houses started to go up in that end of town. It not only shut that down, but the main branch in the town of Transcona lost the commercial banking which was shoved miles down the highway around to Kildonan Place shopping centre.
Now all the merchants in that place, used to dealing with that bank for years and years, are being forced to travel a great distance in order to serve the convenience of the bank. I am told it is not working out that well, which is good, and it may be that they might move back. Hopefully they will reopen the branch at Kern Park but they have not done that so far. All they have set up is some kind of remote teller, I am told, which is really handy for senior citizens to have to stand at some remote teller out in 40 below temperatures in the winter trying to figure out which buttons to push.
This is the kind of service we have been getting from the banks lately. It does not surprise me, therefore, that Canadians are not as disturbed as they should be when they hear that perhaps the government will be allowing others to enter more and more into the kind of services that banks provide.
There is a concern there, as members from Nickel Belt and Essex-Windsor have pointed out. If you are going to have institutions like trust and loan companies behaving like banks, they ought to be regulated like banks, which is a point that the banks make as well and something that certainly has a certain amount of internal coherence to it as an argument.
I think one of the things that we should be concerned about here as we enter into this first in a series, as I understand it, of bills having to do with the deregulation of the financial institutional sector is that this government has learned absolutely nothing about the effects of deregulation. It is embarrassing as a Canadian to have this sort of mimicking of what goes on in the United States happening all the time in Canada. You know, whatever was the fad 10 years ago in the United States, give it enough time and it becomes the fad here.
That would be bad enough, except that generally just as the fad is catching on here, the Americans are catching on that what we are about to imitate is not working. This is true of airline deregulation, and it is also
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true of financial deregulation, not to mention a few other sectors that have been deregulated. I will resist the temptation to go on about rail deregulation.
The fact of the matter is that in the United States where this kind of deregulation has already taken place, we have seen the result. The savings and loans scandal has robbed hundreds of thousands of ordinary American citizens of their savings, of their life's work so to speak, as a result of the government eliminating by legislation their responsibility to ensure that companies into which ordinary Americans, in our case Canadians, entrust their savings, that the companies act in a way that does not put at risk those savings. Yet that is just the kind of thing through deregulation that the government is now contemplating in its own way.
The same thing has happened with airline deregulation. Airline deregulation has not been what it was touted to be. It has resulted in less public safety. It has resulted in worse service for a great many cities and regions of the United States. Yet we are imitating that in Canada. Soon we are going to find that airline deregulation did not result in increased competition and all of the things that have been said for it. We are going to end up with one airline with a monopoly over everything. They have learned nothing.
They have learned nothing from airline deregulation, they have learned nothing about the extent to which deregulation is not the panacea that so many people make it out to be, that it does not lead to this sort of orgy of competition that benefits the consumers. What it does lead to is an orgy of shenanigans between one institution and another, between various kinds of corporate monkeys who find various ways to screw the public and line their own pockets. That is what deregulation amounts to. It is an abdication of the government's responsibility to ensure that if we are going to have a marketplace society, that market operates in certain ways and operates in ways which protect Canadians who would trust their savings to those particular institutions. We do not want to be right about this, just as we did not want to be right about airlines deregulation and about rail deregulation, that it would mean a decrease rather than an increase in rail traffic. But it has meant a decrease in rail traffic because deregulation has lead to the increased use of trucks and this has environmental and public safety consequences.
Right now, near my riding, at Symington yard, you could fire a cannon through those marshalling yards and not be worried about hitting a boxcar because of the continuous erosion, policy-driven by this government, of the use of rail to move products in this country.
We see this result; it was predictable. We are predicting here today that deregulation of financial institutions will lead to some comparable disaster down the road for the public. It is not predictable in its detail but predictable in its certainty that someday we will rue the fact that the government has embarked on this abdication of responsibility. It is not complete abdication; there are rules and regulations and there are new rules and regulations but it is part of a process, part of an over-all philosophy on the part of this government, which says: "We trust the private sector. Those nice fellows out there would never put at risk the savings of senior citizens. They would never put at risk the financial well-being of ordinary Canadian families. They are a good bunch of guys; we do not have to watch them; they will police themselves".
This kind of naivety, and one is never sure whether it is naivety or deliberate, contrived stupidity, is the kind of thing that gets a lot of Canadians into trouble because they still trust that the government feels some residual responsibility for their financial well-being and that it would not allow banks, trust companies, and loan companies to really rip them off or to really put at risk their savings.
That trust is misplaced. It was trust that was misplaced to the extent that there were Canadians who trusted this government not to cut a bad deal with the United States over the Canada-U.S. Free Trade Agreement. Trust was misplaced in a variety of other ways where Canadians could not really bring themselves to believe that any, duly elected, Canadian government would actually sell them down the river. And yet, that is exactly what happened with the Canada-U.S. Free Tirade Agreement. That is what has happened with airline deregulation and, in particular, in smaller towns and cities which now have less service and inferior service to what they had before. And it is certainly true with respect to transportation deregulation as a whole and the way in which our highways are now being clogged by more and more trucks. Just the other day, Mr. Speaker, I was on my way

November 6, 1990
Government Orders
to the airport and a truck went by which was almost as long as a train. It had two units.
I see the hon. member for Winnipeg South Centre in the House. He was the Minister of Transport who started this awful trend back when the Liberals were in power in 1984. They began, with great fanfare and great hope, the era of transport deregulation. What do we see now when we read the Auditor General's report? The Auditor General says that the government was not ready for deregulation and that it has led to all kinds of problems in airports and in other places.
The same thing is true here. We are going to have deregulation because of an ideological fixation about deregulation and we are not going to be ready for it. The government is not willing to anticipate all the problems that deregulation will bring, because to anticipate those problems would be to have a critical consciousness about what it was actually doing. That is something of which this government has so far been incapable, particularly with respect to anything that fits its ideological obsessions.
Mr. Speaker, as you can see, we have a great many concerns about this particular piece of legislation. I am sure that hon. members of my party will have a heyday in committee, exposing all the ways in which this bill inadequately addresses the possibilities for putting at risk the savings and the financial benefits that many Canadians now have locked up in these various financial institutions. I hope that the government, for once, will listen. I hope that the government will listen to the concerns of the public. I have noticed that it listened to the concerns of some of the public, that it has not permitted the banks actually to sell insurance on the premises.
I remember when the insurance agencies were very concerned about this. It was the only time in my life I ever heard from the insurance agencies. Normally they are not a great pool of NDP supporters, although there are a few I know who actually do support me, but generally speaking they are not exactly what one would call an NDP constituency. They certainly came a-knock-ing when it looked like the banks were going to be given the opportunity to sell insurance over the counter.
The banks are going to be entitled to own insurance companies; the same with the car dealers. Again, there is not a great pool of socialists out there on the used and
new car lots of the country, but they also came a-knock-ing when it looked like the banks were going to be able to lease cars directly, which this bill does not permit. But it does permit a certain kind of leasing.
In both cases the foot is in the door. In both cases the banks have received what they wanted and are well on their way to the one-stop shopping for various financial services that they wanted to get. I think that is regrettable because, if we are going to have a competitive financial sector, we should not have departed from the traditional four pillars of the financial sector in this country and allowed them all to collapse into each other, and particularly allowed them to collapse into each other in a way that will permit more foreign ownership.
I was interested in the question that the hon. member for Nickel Belt posed to the Liberal member of Parliament who was speaking.


John R. Rodriguez: Liberal banker.


William Alexander (Bill) Blaikie: The Liberal banker who was speaking, that great Liberal who is actually-


John R. Rodriguez: A Tory.


William Alexander (Bill) Blaikie: A Tory who is more at home in terms of financial policy with the government. This is not a secret. This is well known to all, except perhaps the hon. member who continues to be a Liberal in spite of himself. That is not unusual, is it, for Liberals? They are able to swallow not just any sort of twist or manipulation.


John R. Rodriguez: Themselves.


William Alexander (Bill) Blaikie: They are also able to swallow themselves entirely on occasion, as the leader of the Liberal Party recently did on the GST.
The question, though, that was asked was: Could Canadians, who would not be permitted to do something as Canadians, do something if they were able to disguise themselves as Americans? By buying an American financial institution they would be able to do things in Canada, because it was American, that they would not be allowed to do if that same kind of institution was Canadian owned. What was the answer? Yes.
This is a very strange form of national treatment. National treatment generally means that you will treat someone from another country the same way that you would treat your own nations. What we find in this anomaly is not national treatment, but discrimination in favour of non-nationals so that people can do things in

Canada, if somehow they cannot be Canadian, which they could not do if they were Canadian.
This takes the special relationship that the Prime Minister promised that he would establish with the United States of America when he was elected in 1984 to new heights or depths, depending on your interpretation. What is not possible for Canadians will be possible for Canadians if somehow they have enough money to buy an American company to do in Canada what they would not be able to do if they had a Canadian company which was the very same.
Obviously there are a lot of problems with this deregulation initiative at the philosophical level. The fact is that the government seems to have learned nothing from the empty promises of deregulation which we have seen unfulfilled in other areas. I am sure some very real problems of detail, policy and regulations will be uncovered and, I hope, addressed adequately in committee.


Peter Andrew Stewart Milliken: Mr. Speaker, the hon. member who has just spoken did his usual rant and rave routine about this particular piece of legislation.
I was amused to hear him because, after all, if he had been here to hear the hon. member for Kamloops in his very reasoned expose on this particular piece, I think he would have been surprised to see the number of points of disagreement. I will not go into the details of that, but I will put to him the question I put to the hon. member for Kamloops. Perhaps he is more familiar with his party's policy book than his party's House leader. The hon. member for Kamloops was unable to be specific on this point, and I am hoping the hon. member will be. I understood that as opposed to the idea of regulating banks, it had been the policy of the New Democratic Party to wish to nationalize banks.


Mr. Epp:: I thought it was to abolish them.


Peter Andrew Stewart Milliken: No, no, they did not want to abolish them. The minister says he thinks it was to abolish them. No, they do not want to abolish banks; they want to nationalize banks. They want to take them over and
Government Orders
make them instruments of state policy. This has been their policy for many years. I remember reading about it when I was a school boy. I understand that it has been their policy for wellnigh 50 or 60 years. I do not know how long. Perhaps the hon. member could illumine us on that too.
The hon. member for Kamloops told us this morning that this policy had been ditched. Like their policy on the Senate they had seen the light and, instead of getting rid of the Senate, they now want to save the Senate. Instead of seizing the banks and nationalizing them, they now want to regulate them.
I was told by the hon. member for Kamloops this morning that in fact the NDP policy did change in this regard. It now favours regulation of banks, not nationalization. I wonder if the hon. member could tell us when this policy was changed. At which convention and on which date? I have not seen the evidence of the change. I do not recall reading it.
My recollection is that the policy has simply been suppressed in order to make the New Democratic Party more palatable to more voters. While I am delighted to see that happen, given the party depends so heavily on its claim that it is a very democratic institution responding to the will of its members, I would like to know when the members in a convention changed this policy of nationalization, scrapped it, and came up with this policy of regulation, which incidentally has been Liberal policy consistently for over 50 years.


William Alexander (Bill) Blaikie: Mr. Speaker, it is curious to hear a Liberal get up and talk about Liberal policy, because I have never been able to determine that there is any such thing. Unlike the New Democratic Party, the Liberals never have policy conventions. Every 10 years they have a policy convention whether or not they want to because it seems like a good idea in terms of public relations. The policy debates and conclusions, if they manage to come to any conclusions, are never binding on the caucus. They are not binding on the leader. They are just sort of like stimulating little events that Liberal members of Parliament go to once a decade whether or not they want to. I do not think we have to take anything from the Liberal Party in terms of how our party works.

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Government Orders


Mr. Simmons:: I rise on a point of order, Mr. Speaker. One of the clear rules that the member must observe is that he cannot mislead the House. He has just misled the House.
His leader is going around the country telling the people of Canada she is against Hibernia and she goes to Newfoundland and says she is really for it. They have no policy. They are on both sides of every policy.
He should not mislead the House.


The Acting Speaker (Mr. DeBlois):: Order, please. I do not think this is a point of order. The hon. member for Winnipeg Transcona.


William Alexander (Bill) Blaikie: For the life of me, Mr. Speaker, I cannot remember saying a word about Hibernia.


Roger Simmons: You said you had policies.


William Alexander (Bill) Blaikie: I guess the hon. member must have been watching an entirely different program when he was out in the lobby.


John R. Rodriguez: He woke up.


William Alexander (Bill) Blaikie: He came rushing in here thinking that I had said something that I had not said at all. I recommend to him that if he wants to come down here and make spurious points of order, he should at least be on the right channel when he comes in here.


Roger Simmons: Mr. Speaker, the hon. member for Winnipeg Transcona is absolutely right. I abjectly apologize to him. He did not say they had a new policy. On that he is absolutely right. They have no policy. They have two contradictory policies on everything including Hibernia.


William Alexander (Bill) Blaikie: Mr. Speaker, we do not have two policies on Hibernia. We voted against Hibernia. When the Leader of the New Democratic Party was in Newfoundland, she said the same thing about Hibernia that we have said in this House, that it is not a good deal for the people of Newfoundland. That is why we did not vote for it. We make no apologies for not voting for it. The people of Newfoundland will come to see in short order that it does not contain the benefits for the people of Newfoundland that the hon. member has been sucked into believing by the people on the other side.
Somehow the hon. member for Burin-St. George's has been taken in by the hon. member for Provencher, the two of them now make a pair defending Hibernia. This only goes to prove my point that there really is no difference between the government and the Official Opposition. When it comes to major economic decisions like Hibernia, they all believe in the same sort of thing: giving hundreds of millions of dollars to the corporations to develop the country, to make sure the only true benefactors of these megaprojects continue to be the oil corporations and others who are always involved somewhere at the trough when it comes to these kinds of megaprojects.


Arthur Jacob (Jake) Epp: Mr. Speaker, I rise on a point of order. I did not think we were discussing Hibernia this afternoon. I want to tell the hon. member that in the place they now support, namely the other place, Hibernia will be approved at five minutes to this hour. I invite the hon. member not only to support the Senate at that time but also to support Hibernia.


William Alexander (Bill) Blaikie: Mr. Speaker, it may indeed be approved in the Senate. It certainly has not been improved in the Senate. This does not change our position with respect to Hibernia. What happens in the other place has not, for that matter, changed our position with respect to the current Senate. We believe that it should be abolished.


Some hon. members:: Hear, hear.


William Alexander (Bill) Blaikie: I just wish it was a position that Conservatives had held over the years. All of a sudden everybody over there is for abolishing the Senate. It is too bad that they did not join with the NDP, and before that the CCF, when we were calling for the abolition of the Senate over the years. Before it was a place for retired Tbry hacks and flacks in the majority it was a place for retired Liberal hacks and flacks. If anything comes out of this current crisis in the Senate, perhaps it will be new momentum toward Senate abolition or reform.
Perhaps I could answer the question which was put before I was so rudely interrupted by a colleague of the very person who asked me the question. I am interested that the member for Kingston and the Islands finds the whole idea of public ownership so reprehensible. Perhaps that would explain why his party has been so wimpish on the idea of privatizing Petro-Canada.
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Private Members' Business
Is that why they hardly raised a stink at all about the privatization of Petro-Canada? In their heart of hearts those things which have come under public ownership in this country, like Petro-Canada, have come under public ownership against the real wishes of members of the Liberal Party of Canada. We see them now using the opportunity to get up and denigrate the idea of Canadians owning something like a major oil corporation or a major bank.
We already own the Bank of Canada. Is the member saying that we should privatize the Bank of Canada? Is that what he is saying?


Mr. Worthy:: Mr. Speaker, would you check to see if there is unanimous consent in the House to have this bill referred to the finance committee rather than to the legislative committee?


The Acting Speaker (Mr. DeBlois):: Is there unanimous consent for the bill to be read a second time and referred to the Standing Committee on Finance?


Some hon. members:: Agreed.


Some hon. members:: On division.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Finance.

['Agreed.']
The Acting Speaker (Mr. DeBlois):: I have the honour to inform the House that a communication has been received as follows:
Rideau Hall Ottawa
6 November 1990
Mr. Speaker,
I have the honour to inform you that the Honourable Charles
Gonthier, Puisne Judge of the Supreme Court of Canada, in his
capacity as Deputy Governor General, will proceed to the Senate
Chamber to day, the 6th day of November, 1990, at 5:15 p.m., for
the purpose of giving Royal Assent to a Bill.
Yours sincerely,
Judith A. LaRocque Secretary to the Governor General


Albert Glen Cooper: Mr. Speaker, there have been discussions with the other parties and there is a clear indication to call it five o'clock at this point. However, I think it may take us a few minutes to get everything cranked up for Private Members' Business and so maybe we can suspend to the call of the Chair. As soon as we have the members available for Private Members' Business we can continue at that time.



The Acting Speaker (Mr. DeBlois):: Is there unanimous consent to suspend the sitting of the House during pleasure?


Some hon. members:: Agreed.
At 4.33 p.m. the sitting of the House was suspended.


SITTING RESUMED
[Stage Direction]
The House resumed at 4.37 p.m..
The Acting Speaker (Mr. DeBlois):: Order, please! With unanimous consent, the House will now proceed to consideration of Private Members' Business as listed on today's Order Paper.


PRIVATE MEMBER'S BUSINESS - MOTIONS   CHARLOTTETOWN CONFERENCE ONE HUNDRED AND TWENTY-FIFTH ANNIVERSARY
[Stage Direction]
The House resumed, from October 11, consideration of the motion of Mr. Proud:
That in the opinion of this House, the city of Charlottetown, Prince Edward Island should be designated as the "Birthplace of Canada" to mark the one hundred and twenty-fifth anniversary of the 1864 Charlottetown Conference of the Fathers of
Confederation.
And on the amendment of Mr. MacAulay:
That the motion be amended by deleting the words "Birthplace of Canada" and substituting the following therefor:
"Birthplace of Confederation".
[Stage Direction]
November 6, 1990
Private Members' Business
Mr. Jean-Luc Joncas (Matapedia-Matane):: Mr. Speaker, I welcome this opportunity to support the motion by the hon. member for Hillsborough, as amended to emphasize that Charlottetown should be recognized as the birthplace of Confederation and not of Canada.
As you know, Mr. Speaker, this initiative is intended to mark the one hundred and twenty-fifth anniversary of the 1864 Charlottetown Conference.
I have no quarrel with providing an official designation to mark the events that took place in this city in September 1864. The importance of the decisions that were made and their impact on our common destiny should be recognized by all Canadians.
However, we must not forget that Upper and Lower Canada were founded in 1791, nearly a century before the Charlottetown Conference. In fact, well before that date, the word "Canada" had been used by Jacques Cartier when on August 13, 1535, two young Indians in his company told him how to get to "Canada"; they were referring to the village of Stadacona, on the present site of Quebec City.
In fact, if we read official correspondence at the time, we find that the name Canada was synonymous with New France. However, in 1763, Great Britain dropped the name New France, using the designation Province of Quebec instead. The fact remains, however, that Canada designated, first of all, a geographic area washed by the waters of the St. Lawrence.
Canada was designated as such by the Constitutional Act, 1791. A considerably larger Quebec was divided into the provinces of Lower Canada and Upper Canada. In 1841, the two provinces were united as the Province of Canada. You will agree this was well before 1864.
Mr. Speaker, I add these few details because I want to give Quebec the place it deserves-its true status as the birthplace of Canada.
The Charlottetown Conference was indeed a crucial moment in our history. It acted as a catalyst, uniting strong forces that until then had been active, but in isolation, in the colonies of British North America.
It was a first step toward building a modem nation and ultimately, led to its gradual expansion from coast to coast.
When on September 1,1864, Charlottetown welcomed representatives of the United Province to the conference, it opened the way to union with the other colonies of British North America. A month later, this new spirit of co-operation was further expressed at the Quebec Conference, where those who would henceforth be called the Fathers of Confederation continued the work begun in Charlottetown.
They agreed on 72 resolutions, the so-called Quebec resolutions, which would form the basis for a union that would be officially recognized on July 1, 1867, by the British North America Act.
However, Mr. Speaker, without those initial steps in Charlottetown, subsequent developments would never have been possible. I am therefore pleased to support a proposal to designate Charlottetown as the birthplace of Confederation. Thanks to the federative pact that came out of this conference, Canada, after having been first a French and then a British colony, was able to become the vast country that has aroused the admiration of so many people throughout the world.
Perhaps I may quote a comment by U.S. historian S.E. Morrison, who said that never since the Roman Empire had local designations expanded so far beyond their original territory as did Canada and the St. Lawrence.
In 1989, we celebrated the anniversary of the conference where the foundation of Confederation was laid. Charlottetown has every reason to be proud of giving birth to a political and administrative superstructure, to which each member freely agreed to belong.
As the birthplace of Confederation, Charlottetown will remind us of the seeds of unity it sowed in our common history.
Although the capital of Prince Edward Island belongs above all to its inhabitants, in a broader sense it also belongs to all Canadians. That is why, Mr. Speaker, we want to stress its historical value, and I also think it would be a good opportunity to recall the principles that formed and continue to form the basis of our evolution as a nation.
November 6, 1990

Briefly, they can be identified as follows: liberty, diversity and solidarity.
Liberty first of all, because, as I said earlier, today's Canada was bom of a union that was entered into by free agents. In 1864 as in 1867, every member of that union believed, and history has borne this out, that they were right to do what they did and that united they would be strong.
Diversity-and I think it is appropriate to remember this, Mr. Speaker-because the British North America Act recognized the distinct identity of Quebec society by creating its own territory and recognizing its Civil Code, its language and its religion.
Finally, solidarity, because it and it alone has ensured that liberty and diversity have become a fact of life in Canada. Without the spirit of solidarity that inspired our ancestors, Canada would not have been able to deal as effectively with the problems it faced at the time. Although today's challenges may be different, I am sure that a belief in the principles established by the Fathers of Confederation will help us meet these challenges as well.
We Canadians, as human beings and with our legacy of diversity, have forged common traits and common values that today form the very essence of our national identity. Liberty, diversity and solidarity-sharing good times and bad, glory and despair, joy and sorrow.
I think this permanent commemoration of the 125th anniversary of the Charlottetown Conference of the Fathers of Confederation would be a good way to remember its guiding principles. That is why, Mr. Speaker, I am prepared to reiterate my support for this proposal to designate Charlottetown as the birthplace of Confederation, because this city has played an important role, both tangible and symbolic, in this great adventure we call Canada.


Mr. J. W. Bud Bird (Fredericton-York-Sunbury):: Mr. Speaker, I take very great pleasure in the opportunity to speak on this private members' motion of the hon. member from Prince Edward Island. Coming from New Brunswick, a sister province of Prince Edward Island and one of those provinces which joined with Prince Edward Island and the rest of Canada in 1864 to talk about the
Private Members' Business
idea of Confederation, I am particularly honoured tonight to participate in the debate on this resolution to pay tribute to Charlottetown as the birthplace of Confederation. It is with great pride that I stand before my colleagues to say a few words about the events that led to the birth of our nation.
Coincidentally, I am told that it was on this date, November 6, 1867, that Canada's Parliament was convened in session for the very first time. It is a particularly significant afternoon.
To remember our past is no mere exercise in nostalgia. It is a way of understanding who we are as a people and where we are going. I am reminded of the words of Canon Lionel Groulx, the prominent historian from Montreal, who wrote: "A nation cannot separate itself from its past any more than a river can separate itself from its source. No generation is self-sufficient."
It is good and it is important to take a long-range view of Canada. We should realize that the constitutional discussions of 1990 arise from the vibrant passages from our history books. Their origins lie in those very first exercises in consensus building conducted by the Fathers of Confederation almost 125 years ago.
What happened in those early days of Confederation and what is happening now are part of a continuum in all parts of an ongoing effort to work through our differences and to find mutually acceptable systems of federalism for all communities of Canada. It is part of the process of defining ourselves and of developing a national identity for this dynamic young country of ours.
Let us hope and pray that the Citizens' Forum on Canada's Future, created by the Prime Minister last week, will be truly successful in its mission to rekindle the vision of a strongly united Canada in the minds of all Canadians as we proceed on our historic constitutional journey in the months that lie ahead.
As others have said, the Fathers of Confederation had to establish the basis for a national identity that would encompass divergent interests and needs. They were successful, but they could only begin the task. It was up to future generations such as ours to continue to build on the past and to shape the nation of their dreams and the nation of our dreams. That process is far from over.

November 6, 1990
Private Members' Business
As we have known in recent years and months, there has been pain and discord, and there remains much healing to do because of the often painful emotions which have been stirred in the heat of debate. Nevertheless, I believe that we will come out of this process much stronger and much more committed in all ways than ever to staying together as a united Canada.
Yes, we Canadians do have our differences from coast to coast, from region to region, from culture to culture, and from language to language. And, yes, we sometimes argue and we debate vigorously about those differences. And, yes, sometimes we find the ties that bind are either too tight or too loose. But the longer we stay together, the more, I believe, we appreciate what we can gain through this great Canadian experiment; this marriage of provinces, territories and regions; and this embracing of two official languages and so many cultures.
The motion before us today to honour the role of Charlottetown in the Canadian nation has great merit. Such recognition is important, not only to Charlottetown, and not just to Prince Edward Island, but to all of Canada. To pass this motion will help us to celebrate the great achievement of nationhood which we enjoy, and it will help to guide us toward a better understanding of our origins.
I agree with my colleagues who have said that we must take care to be correct about the wording. If we were merely to say that Charlottetown is the birthplace of Canada, we would be losing sight of some very important historical facts. The term "Canada" was long in use before 1864 when the the Charlottetown Conference brought colonial representatives together to discuss the idea of a federation of British North America which has become Canada.

Mr. Speaker, in the 16th century the word "Canada" was used as a synonym to describe France's colonies in New France. Explorer Jacques Cartier even referred to the St. Lawrence River as the river of Canada. The first Canada therefore was a French Canada, and the foundations of this nation were laid mostly by French-speaking settlers.

Our Canadian nation actually took root in the soil of Quebec. Later, the Constitutional Act of 1791 created
two political entities bearing the name Canada. These entities, Upper and Lower Canada, were the origins of the modem provinces of Ontario and Quebec.
In 1841, as you know, Mr. Speaker, the two entities were joined for a few decades into one province of Canada. It was a delegation from that province which met with the maritime representatives in Charlottetown in 1864 to propose the idea of a federation. In fact, originally the Charlottetown Conference was only to consider a union between Prince Edward Island, Nova Scotia and New Brunswick, my own home province. The government of the Province of Canada at that time asked permission to send representatives to that meeting. It then put forward its proposal for a larger union.
The practical details of the union were hammered out a month later at a conference in Quebec City. This meeting agreed to 72 resolutions, known as the Quebec Resolutions, which became the basis of the statute that would unite some of the British North American provinces into the confederation called Canada.
The vision presented was of a new nation from sea to sea, one of great national wealth and potential. It would offer both the security of a federal parliamentary system and the autonomy over provincial affairs. It would give the people of Quebec more control over language and education, and would recognize Quebec's separate legal system, the civil code, which remains in practice in that province today.
At the very time that our U.S. neighbours were engaged in a bloody civil war, our founding communities were seeking the peaceful road to union. They were reaching out to one another in a spirit of compromise, generosity and trust. Can we do less today?
Embedded in our first constitutional document was recognition of the distinct nature of Quebec. We continue to respect the original pact with Quebecers in Canada and we seek to strengthen its meaning in today's circumstances.
Being precise about the details of history helps to remind us how much we really are a blend of different cultures and traditions and how much we owe to both the French and the English-speaking elements of our roots.
November 6, 1990

I want to support the amended motion that Charlottetown be designated the birthplace of Confederation. Not only was Charlottetown the host city for the Fathers of Confederation in 1864, but it also contains the original building in which the leaders met. Its restored sector beautifully preserves the atmosphere of those times.
Just last year, Prince Edward Islanders celebrated the 125th anniversary of the 1864 Conference with festivals, exhibitions, and theatre productions. Although that anniversary year is over, it is still important to keep the memory of 1864 alive. We must ensure that Canadians do remember those first crucial steps toward the formation of our country, particularly as we draw closer to 1992 which will be the 125th anniversary of our Confederation. It will certainly be a great occasion for celebration all across Canada.
We have much to celebrate. We have created something great here on this continent. Our different cultures and communities have maintained their distinct identities while enriching one another.

The union of French and English Canada was the basis of the vision of a tolerant, humane, generous, forwardlooking and open Canada. Of course we did not quite achieve all these goals. Indeed we have covered a lot of ground since that first pathetic debate at Charlottetown, but we still have a long way to go.

In closing, it is up to all Canadians to continue the work of reaching out to one another and building a new climate of trust and understanding that can only come from faith and goodwill of every citizen of the country. A nation is based on much more than a constitution. It is based on a sense of community. We, in the House, have a special responsibility. We must all work in our respective constituencies to heal the wounds, to spread the message of hope, to strengthen the trust, and to ensure the future unity of this great country, Canada.


Mrs. Beryl Gaffney (Nepean):: Mr. Speaker, I am most pleased to stand in the House today and speak to Private Members' Motion No. 498, as put forward by my honourable colleague, the hon. member for Hillsborough, and
Private Members' Business
amended by another hon. colleague, the hon. member for Cardigan.
The motion reads, and I quote:
That in the opinion of this House, the city of Charlottetown, Prince Edward Island should be designated as the "Birthplace of Canada" to mark the one hundred and twenty-fifth anniversary of the 1864 Charlottetown Conference of the Fathers of Confederation.
One might ask why I, the member of Parliament for Nepean, Ontario would be speaking on this motion today. Prince Edward Island is my birthplace. As a native islander-I was bom in Summerside, Prince Edward Island-as the daughter of a North Bedeque potato farmer, as the descendant of ancestors who arrived on the island in the year 1779, as a former student of Prince of Wales College in Charlottetown, and as an expatriate sister of two brothers and a sister still residing on the island, I feel more than qualified, and especially honoured, to speak to this motion.
P.E.I. is probably one of the most unique provinces of Canada. It has never lost its sense of history. There is tremendous pride in its heritage and its residents have gone to great lengths to preserve this heritage. However, there is one stone that has been left unturned and that is the purpose of the motion before us here this afternoon.
Mr. Speaker, I will make note here that my research material has been taken largely from historical documents written by Reverend Francis W. P. Bolger, PhD., St. Dunstan's University, Charlottetown, Prince Edward Island.
In the Legislative Council Chamber in the Provincial Building in Charlottetown on September 8, 1864, the guest speaker concluded his speech to conference delegates by saying:
I believe, from all that I can learn that the Provinces will, ere long, be one great country or nation, from the Pacific to the Atlantic. Never before was there such an important meeting as this held in the history of British America; and it may yet be said that here, in little Prince Edward Island, was that union formed which has produced one of the greatest nations on the face of God's earth.
Fifty years later, the government of the day erected a bronze tablet in commemoration of Confederation, on which was engraved:
Unity is strength. In the hearts and minds of the delegates who assembled in this room on September 1, 1864, was bom the Dominion of Canada. Providence being their guide, they built better than they knew.

November 6, 1990
Private Members' Business
Listen to the words and think of those words that were used: "Provinces will be one great nation".
This was said way back in those years, Mr. Speaker.
They said: "The Union has produced one of the greatest nations on earth". They also said: "Unity is strength". We need to reflect on those words today.
At a time in our history when some are questioning Canada as a federation, I believe it is time to renew our vows, so to say, as a nation; Motion M-498 will do just that.
In April 1864, the three maritime provinces met with the idea that a union of the three would be beneficial to all.
Interestingly enough it was P.E.I. which opposed such a union as it was feared they might lose their independence.
However, they did take the initiative to explore whether the "Canadian" delegation-and the Canadian delegation was referred to by the member for Fredericton-Upper Canada and Lower Canada, would meet with the maritime premiers to determine if a union of the whole of the British North American provinces was feasible. It was agreed that there would be a meeting and Charlottetown was chosen as the location.
The Charlottetown Conference opened on September 1, 1884. John A. Macdonald made a long speech in favour of the union.
The "Canadians" were indifferent as to whether the maritimes entered individually or as a unit.
The shelving of the maritime union actually happened during the conference and this in turn helped the cause of Confederation.
A very important result of the conference was that it was unanimously agreed that a federal union of all of the British North American provinces would be advantageous if it could be based upon principles that were just and equitable to the several provinces. I think that holds true today, Mr. Speaker.
The delegates went so far as to agree provisionally on certain principles which should be incorporated into the larger plan. On the consummation of the union, all debts would be assumed by the federal government.
It is abundantly clear that the Charlottetown Conference did accomplish a great deal with respect to the
future constitution of Canada. The agreement that a federal union was feasible and the broad outline of a constitution for such a union was indeed a major accomplishment.
The adjustment of the details was destined to be a painful task, but an important step had already been taken.
The most important effect of the conference was that the deliberations at Charlottetown had revealed that there was sufficient agreement on the principle of a federal union to justify the continuance of the discussion in a subsequent formal meeting at Quebec.
The conference provided an opportunity for the leading statesmen of the several provinces to become acquainted with each other and to cement the personal relationships that are intangible necessities in any formal negotiation. Moreover, the broad agreements reached facilitated the completion of a federal scheme at the Quebec Conference. John A. Macdonald, who may be regarded as the architect of the Canadian federal union, made references to the Charlottetown Conference in the Canadian Confederation debates in 1865, which can be regarded as very adequate analyses of the results of the conference.
John A. Macdonald asserted in his first debate on February 6, 1865, that "the broad agreements reached at the Charlottetown conference greatly facilitated the acceptance of the federal union at Quebec".
Later, in the same debate, he claimed that if the Charlottetown Conference had not been held, federal union could well have been delayed for many years. Macdonald's tributes to this conference placed its importance as a prerequisite to federal union beyond question.
From these considerations, I trust that you will agree that the Charlottetown Conference was a very important step in the formation of our Canadian nation.
I regret, however, that few accounts of Canadian history recognize its importance. Too often references to the Charlottetown conference limit their focus to the following type of remarks: "The Fathers of Confederation met in Charlottetown in September 1864, and there it was decided to have a formal conference in Quebec in October".
November 6, 1990

The author I referred to earlier in my opening comments, Reverend Francis W. R Bolger, believes that such a cursory treatment of the conference leaves a tremendous gap in our knowledge of the story of Confederation.
Although the political baby, "Confederation", was not born at the Charlottetown Conference, Dr. Bolger felt that the provision of the "cradle" was of great significance and should be recognized as such in Canadian history.
I have related the historical events surrounding the conference as related by Reverend Dr. Bolger and I am most grateful for his writings. He has been widely recognized as the pre-eminent scholar for the island's history. It is only right that his writings be used by myself and written into the House of Commons Hansard in perpetuity for all to see.
The 125th anniversary of Confederation will be celebrated in 1992 and it is hoped that this narrative will help Canadians better understand and be more aware of their history.
Today we see a fractured Canada. We see tensions between provinces. We hear of provinces talking of their independence and separating from the federal union. We need to find unifying symbols that will again continue to tie us together.
The recognition of Charlottetown as the birthplace of Confederation will have a profound economic benefit to the island, but it will also reaffirm Prince Edward Island's commitment to Canada and Canada's commitment to the island and its capital, Charlottetown.
It has been a real privilege for me to speak here today in the House on this motion. As referred to by the member for Fredericton, I think that this is one of the glues that can help tie this nation together. I think we should reflect very seriously on the intent of the motion and what it is intended to do.


William Alexander (Bill) Blaikie: Mr. Speaker, just a brief word in support of the motion which is before the House. Other hon. members have done a good job of recounting the history of pre-Confederation, Confederation itself and post-Confederation. They have given us a lot of welcome advice on the things we ought to keep in mind at this particular juncture in Canadian history.
Private Members' Business
I might say that at least in my history lessons that I received at school, Charlottetown did receive full credit. I had not heard about the subsequent conference in Quebec. I think that Charlottetown certainly has received a good deal of the credit for being the birthplace of Confederation.
I think it is a time for us to remember that what Sir John A. Macdonald called the happy opportunity of founding a great nation still is an opportunity, an opportunity that always has to be worked on, that is a continuing opportunity that no country, no nation can take for granted. I think there is an element in the Canadian consciousness whereby we assume that our country is different from other countries, that it is not exposed to all the tensions and travail of human history. I think we found out, I hope early enough, that we are not and that it takes a lot of work to keep the country together, particularly one as large and as diverse as Canada.
In closing, Mr. Speaker, I would just like to bring to the attention of the House the remarks made by the now retired Secretary General of the Commonwealth, Sonny Ramphal. He appeared before the Standing Committee on External Affairs and International Trade in what was sort of a parting testimony, if you like, at the time when we did not yet know the fate of the Meech Lake Accord.
Whatever our individual or our collective opinion might be about the Meech Lake Accord, I think that what he had to say to the committee at that time is still instructive, even in the post-Meech Lake failure period. What he said was this, and it was very much like something I had to say in earlier debates on the Constitution in the early 1980s: if Canada, a country with so much going for it, with a strong democratic tradition, with a history of solving problems co-operatively and peacefully, cannot reconcile within ourselves the problems that come from having a country with more than one linguistic community and a variety of peoples from all around the world, if we who, if you like, are the prototype of the world, if we, with everything going for us, cannot determine how to live together and somehow fragment and break apart, then this will be a terrible signal indeed for the rest of the world.

Adjournment Debate
I think it is something that we do not keep in mind often enough, and that is that a lot rides in terms of moral and political example on how Canadians deal with each other. For a long time, the nations of the world have looked to Canada and its experience as an example of where people of different cultures, different languages and different traditions, have been able to come together and form one country.
If we now, at a time when the world more than ever needs to learn that lesson, unlearn ours, then we will not only be doing a disservice to ourselves, to the heritage which so many people have pointed out this afternoon and to the future, as it pertains to our own children and grandchildren, but we will be doing a disservice to the world because we will be saying: "Even here in Canada with everything going for us, we were not able to manage it; you guys should forget it". I think that is a terrible message to send out to the rest of the planet.


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


Some hon. members:: Question.


The Acting Speaker (Mr. DeBIois):: The question is on the amendment. Is it the pleasure of the House to adopt the amendment?


Some hon. members:: Agreed.
Amendment (Mr. MacAulay) agreed to.


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


Some hon. members:: Agreed.
Motion, as amended, agreed to.


The Acting Speaker (Mr. DeBIois):: On a point of order, the hon. member for Hillsborough.


George Albert Proud: Mr. Speaker, on a point of order. I want to thank all those who spoke today and on October 11.
I want to thank the three parties for supporting my motion. Certainly, as has been said here this afternoon and as was said the day on which this motion was introduced, now is the time that we should look at the things that happened in Charlottetown in 1864 and consequently went on in Quebec to become this great country.
I thank all of those who participated very much. It is a great day for Charlottetown. It is a great day for Canada.


Mr. Belsher:: Mr. Speaker, I rise on a point of order. If Your Honour would seek the consent of the House, we could now call it six o'clock.
Also we should bear in mind the previous notice that you had from the other place. I am expecting that Black Rod could be interrupting our Adjournment Debate. If so, then we could continue the Adjournment Debate following our return from the Senate. If perchance we should complete our Adjournment Debate before the Black Rod arrives, could we recess our sitting until he does arrive so that we could fulfil our obligation to the other House?


The Acting Speaker (Mr. DeBIois):: Does the House agree with the suggestion of the hon. Parliamentary Secretary to the Minister of Transport?


Some hon. members:: Agreed.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mrs. Shirley Maheu (Saint-Laurent-Cartierville):: Last May, Mr. Speaker, I asked the Minister of State for Multiculturalism and Citizenship to explain to us why he was unable to hire representatives of visible minorities, particularly women. I also asked him to tell us when he thought he would remedy such a deplorable situation.
The minister being absent, the Acting Prime Minister answered that objectives for 1991 would indicate an increase of 3.8 per cent in the number of visible minority representatives in the public service.
Mr. Speaker, I must say that this reply does not really provide us with any guarantee as to the number of women from visible minorities who will have jobs in the Public Service.

I would like to quote an answer that the Minister of State for Multiculturalism and Citizenship gave during a talk show on multicultural policy in Alberta on May 14 of this year.
November 6, 1990

To the question "You're trying to create equal opportunity, aren't you", the minister responded:
Equal opportunity. Equal access. You have to have the ability, of course. When I look around, and when we see there is absolutely no opportunity and no (way) for any of the visible minorities to be included, of course we have difficult police-racial-minority relations.
We ask that (an) institution examine not only its own program of cross-cultural understanding but find a way to include some of them within (for example) the police department, so that there will be a better relationship and there will be an ability of the police and collegiality to understand how minority and community cultures think.
Let me turn it around. You've got a visible minority population in Toronto of 20 per cent. Go to any institution. Do you find them in relative numbers? Not at all -So we need a little catching up to do."
I would like to know how the minister hopes to have a better participation from the institutions in the integration of visible minorities, and women in particular, when his own department does not lead the way.

Mr. Speaker, if there is a Department which should have a large proportion of visible minority people, it is that of Multiculturalism and Citizenship. If this agency wants to get results, it should set an example.
How could it ask institutions to hire at least the minimal percentage required by the government when this very government does not meet its own standards?
If it is important for this agency to show leadership with regard to visible minorities, Mr. Speaker, it is also vital that it should open the way for women. This does not mean doubling the clerical staff establishment. It is important for women to assume more and more decision-making positions. There are many competent women. The government should have the political will to seek them out, accept to pay the price and stop being afraid of them. If the minister is really sincere, he will find the way to hire in his own department women from visible minorities in executive positions. Only then will he be in a position to require others to meet the standards.

If multiculturalism is the reality of this nation, as the minister said, how does he intend to reflect this reality in his own department?
Adjournment Debate The minister affirmed the following:
I guess my obligation is, in addition to helping people in their awareness-to reach out and seek the partnerships; it is to challenge every institution of the community so that it examines itself and makes sure that it provides opportunity for the full Canadian diversity to participate.
Is he asking others to do what he is incapable of doing? [Translation]
Mr. Speaker, I realize that departmental staff cannot be changed overnight, but the Minister was given responsibility for Multiculturalism and Citizenship some time ago. How much longer do we have to wait to see visible minorities and women in senior management?
Mr. Speaker, I believe that if we want things to happen, we must clearly identify what objectives should be reached and when. It is too easy to say that things have improved and that we are making headway. Going along at a snail's pace is not exactly what I would call progress, but perhaps that is why this issue is still on the agenda.
Mr. Speaker, I hope that the Minister responsible for Multiculturalism and Citizenship will soon be able to tell us that a number of management positions, in his own department, for instance, are held by representatives of visible minorities. Meanwhile, we in the Liberal Party will continue to put pressure on the government to achieve balanced representation.


Ross Belsher: Mr. Speaker, I am pleased to have this opportunity to address the question put by the hon. member opposite on May 14 regarding the employment opportunities for visible minorities within the public sector.
The federal government is strongly committed to the principle of equality in the work place and to fair employment practices over all. Awareness, dedication and a solid, concrete plan of action have been the essence of the government's approach. We have sought to ensure that all employees are free from discriminatory attitudes that stifle individual productivity and limit personal growth.
There has been a comprehensive program of employment equity in place since 1983. It clearly requires that all government departments and agencies develop action

15236	COMMONS DEBATES	November 6, 1990
Adjournment Debate
plans, including specific numerical targets for improving the representation of designated groups.
Over the years, significant progress has been made in promoting the employment of members of visible minority groups in the Public Service. As of 1989 the number of visible minorities within the Public Service had risen to 6,829, compared to 4,159 in 1985. Over the four-year period the percentage rate has nearly doubled from 1.7 per cent to 3 per cent of the total work force.
Treasury Board has also established the Visible Minority Employment Program to recruit members of visible minorities actively. It has allocated more than $15 million and 400 person-years for the period 1988 through 1993. In addition, an advisory committee on the employment of visible minorities is in place to address issues of concern to visible minorities.
The present government clearly recognizes the unfortunate reality that certain segments of Canada's population are still confronted with serious disadvantages in the job market. That is why the government has determined to take a pro-active role by seeking to create a workforce in the Public Service inclusive of aboriginal peoples, members of visible minority groups, persons with disabilities, and women. They are a part of this nation's work force and deserve to be optimistic about their future.
The President of the Treasury Board indicated that considerable progress has been made in recent years on this front. At present, an increase of 3.8 per cent in minority representation within the Public Service is being projected for 1991.
With respect to the representation of women in the Public Service, we have redoubled our efforts. All major categories within the Public Service have experienced steady increases in the number of women participating since 1984 when the government was first elected. In keeping with this, it is equally vital that women be represented in the upper levels of the Public Service and in positions of authority. The representation of women in the management category has increased from 7 per cent in 1984 to 14.1 per cent in 1989.
The government stands firmly by its commitment to promote the increased representation of visible minorities and women within the Public Service. More than
ever it is determined to ensure that the equality of opportunity and access guaranteed by our Employment Equity Act, our Canadian Charter of Rights and Freedoms, and our Canadian Multiculturalism Act is reflected within the Public Service.
Yes, there is still room for improvement, and we in the government are the first ones to admit it. We are determined to spare no effort in ensuring that the Public Service of the 1990s and beyond reflect the rich diversity and broad experience of all Canadians.



THE ROYAL ASSENT

[Stage Direction]
A message was delivered by the Gentleman Usher of the Black Rod as follows:
Mr. Speaker, the Honourable Deputy to the Governor General desires the immediate attendance of this honourable House in the chamber of the honourable the Senate.
Accordingly, Mr. Speaker with the House went up to the Senate chamber.
[Translation\
And being returned:
['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).']
The Acting Speaker (Mr. DeBlois):: I have the honour to inform the House that when the House went up to the Senate Chamber, the Deputy Governor General was pleased to give, in Her Majesty's name, the Royal Assent to the following bill:
Bill C-44, an Act respecting the Hibernia Development Project and to amend certain Acts in relation thereto.-Chapter 41.

The hon. member for Timmins-Chapleau has the floor.



Mr. Cid Samson (Timmins-Chapleau):: Mr. Speaker, when I asked the Minister of Employment and Immigration last week if she would consider granting retroactive parental benefits to January, 1990, she gave me a very curt and blunt answer. She simply said "no".
Since then we have seen in the press many articles referring to the current confusion with regard to which new parents may qualify or not for these benefits. I understand the problems involved in putting together a new program, but I must again point out to the minister something she might have forgotten; pregnant women

cannot put off giving birth until everyone has been properly briefed on the issue.
Not only is the minister creating tension at what should be a joyous occasion, but she is also hiding behind overworked government employees to avoid doing something.
In committee on October 25, the Deputy Minister and Chairman of the Department of Employment and Immigration said there would be newspaper ads on November 12 and brochures mailed to people currently on claim to inform them.
Meanwhile, it appears that employees of Employment Centres in Canada are being kept in the dark, as well as the Canadian public. The minister's office is saying on the one hand that in some cases parents of babies bom before November 18 could still receive the parental benefits, providing they do not start a claim before the implementation date or even in some cases, if there had been a claim but the woman had gone back to work for 20 weeks, she could then apply for the benefits.
Other scenarios have also been outlined by the minister's office, but it seems that her office has not been able to make their wishes known across the country.
One must wonder, Mr. Speaker, what it will take for those in the front line, when you consider the massive lay-offs due to the recession. Clearly under the present conditions, there will be longer delays for people before they can receive payment.
When this is added to a complex, and I want to point out, mostly unfair reform of the unemployment insurance system, things can only get worse. Given the fact that the minister has not specified what could happen to people who are not fully informed prior to the implementation of these benefits, she is preparing another bureaucratic nightmare.
She should reconsider her previous decision and make parental benefits retroactive, if not all the way back to January 1, at least to when Royal Assent was given, to allow more people to qualify and also to simplify the process.
Given the current situation, she should also consider hiring more staff to expedite the process. The union representing employees at the Employment Centre, PSAC, has asked for an increase in staff for the past two
Adjournment Debate
years. What kind of a nightmare are these employees, who now have shortfalls, going to be facing with even more problems with these new applicants?
To make matters more difficult, she added some small benefits such as the parental benefit. I want to add that no one can argue that granting parental benefits is a bad thing, but in introducing this it should not be done on the backs and at the expense of other unemployed workers.

Last week, the National Anti-Poverty Organization, the Mouvement action-chomage de Montreal and the Ontario Coalition Against Poverty denounced the changes to the Unemployment Insurance scheme as one of the worst attacks against wage-earners.
We may well wonder if the figures quoted by Deputy Minister Kroeger in committee were a figment of his imagination.
The Deputy Minister claimed that, according to some studies, only 30,000 people would be affected by the changes to the Unemployment Insurance Act.
Yet, according to the figures provided by the Quebec Department of Employment, nearly 60,000 people will be affected by this reform.

Welfare cases in metro Toronto are expected to almost double from last year. The tightening of federal unemployment insurance rules is being labelled as one of the causes.
We also read in the minutes of the committee that the training aspect of the bill will not be in effect until January 1, 1991. The government has been collecting higher premiums since January of 1990, yet the programs are not in place. The government is making money on the backs of those who can least afford it. The government had an alternative but they clearly refused to look at one; the same way they refused to look at all other alternatives to the GST.
In Australia the government has decided to legislate a national training tax system, known as the training guarantee. This scheme will ensure that all Australian firms with an annual payroll of over $200,000 will spend a minimum of 1 per cent of payroll on approved training in 1990-91 and then the minimum will rise to 1.5 per cent of payroll after two years. There is an alternative that

Adjournment Debate
would have achieved the goal of maintaining and upgrading a highly skilled labour force.
The minister thought she would be better off with the easy way out, by taking away funding from a much needed program, particularly in these difficult times. She took the easy way out and working families must deal with the consequences.
We are looking for a favourable solution to this problem and I hope that the Minister of State for Employment and Immigration will rise and offer us a solution.


Ross Belsher: Mr. Speaker, I would like to address some of the points made by the hon. member opposite. The government, and I am sure, most Canadians are happy that the Senate has finally seen fit to pass Bill C-21. Indeed, some of the comments that the hon. member makes today are directly related to the measures in that bill that are seen as improvements by many people in this country.
In respect of the member's comment that they implementation of Bill C-21 is a nightmare in some cases, I would appreciate some details rather than general allegations. My information is that the implementation of the bill is proceeding on schedule and that the local offices are well able to cope with the problems they face.
In so far as the provision of parental benefits is concerned, I would be remiss if I did not point out, for information purposes at least, that it is this government that saw fit to introduce them. We do not need any lessons from the opposition as to their appropriateness. The parental provisions of Bill C-21 represent a significant advance over the existing legislation, and have been introduced to recognize the legitimate concerns of Canadians who find themselves in the position of starting families and wishing to maintain an active attachment to the labour force at the same time.
The hon. member seems to think that Canadian families have paid for parental benefits since January, 1990. Nothing could be further from the truth. He did not correctly understand the minister's first press conference on Bill C-21 in April, 1989 and subsequent explanations on many occasions.
She has explained clearly and repeatedly that the economies realized from the new provisions respecting entrance, duration, and voluntary leaving employment without just cause would be poured back into the program in order to finance the significant improvements being made in the areas of training, parental benefits, benefits to persons over the age of 65, and so on. The increased premiums are not paying for the program enrichment.
The setting of the premium rate was announced by the Minister of Finance in his budget of April, 1989. It is in no way tied to the more generous benefits contained in Bill C-21. In fact, as the minister and her officials testified before the committees in the House of Commons and in the Senate, the freezing of the premium rates for 1990, 1991, and 1992 is designed to soften the impact on a yearly basis of the introduction of the Labour Force Development Strategy as a whole.
We also clearly said that if there were any deficits in the UI account were to accrue, the Government of Canada would-as it has done in the past-advance the necessary funds to ensure that the account is able to continue to pay the UI benefits that Canadians need.
I would also like to comment on the issue of retroactivity. The hon. member wants to know why the parental benefits are not made retroactive to January, 1990. No one would be happier than this government if this could have been the case. Indeed, the Labour Force Development Strategy was developed so that the parental benefits would come into effect on January 1, 1990.
However, the Senate of Canada, for reasons still best known to itself, chose to delay the legislation for almost a year. Thus, instead of coming into force on January 1, 1990 as we had planned, the parental benefits provisions will only have effect as of November 18, 1990.
People such as the hon. member who want to know why this took so long are best advised to pose their question elsewhere as the intent of the government in this respect has been clear and consistent. I regret that the passage of the bill was delayed so long and I believe that the hon. member will, upon reflection, feel the same way.
November 6, 1990


THE ECONOMY
Mr. Alfonso Gagliano (Saint-Leonard):: Mr. Speaker, I am grateful to you for this opportunity to take part in this debate on the adjournment motion about the issue which I raised with the Minister of Finance on October 11, as reported on page 141 of Hansard. My question had to do with the great many jobs being lost every day, including 3,000 at Air Canada, 1,500 at CN and 3,000 at Esso. To date, I should like to add the 700 lost at Marine Industries and approximately 1,000 at Kratt & Whitney in Longueuil. Also, the number of banruptcies is on the rise. A short while ago, as a result of several questions from the opposition, the Minister of Finance finally recognized that we are now in a recession.
What I found astonishing, Mr. Speaker, in the Minister's response to my question was this, and I quote:
[ -] Surely he acknowledges that the biggest problem that Air Canada has today is the increase in oil prices, which in turn has been caused by the international problem in the Middle East right now.
There is indeed a crisis in the Persian Gulf, Mr. Speaker, but that is not why Air Canada laid-off 3,000 people. I think the lay-offs are due to a much deeper crisis. It has to do, first of all, with the Minister of Finance's high dollar monetary policy. Tourism, for example, had a disastrous season. Suffice it to quote Claude Picher who was saying the following, just a few days ago, in an article published in La Presse on October 23. With your permission, Mr. Speaker, I would like to read part of that interesting article:
Tburistic nightmare
A harsh and inescapable reality is emerging from behind the official optimism of the travel promotion industry: Canada is headed for its worst deficit ever, and by far in The Tburism industry! The most recent statistics indicate that the peak season-July and August-is a disaster. If past trends are any indication we can already forecast that Canada's 1990 tourism deficit will be around $4.4 billion-an increase of 26 per cent over 1989 and 62 per cent over 1988. Even accounting for inflation the deterioration is spectacular. You will have a good idea of the damage if I point out that, at the time, 1988 had been labelled a disaster year!
Of course, you can always say that Canada is used to that. Year in and year out our tourism deficit is rather significant. Particularly troubling this year-never mind the huge deficit-are the summer figures.
Adjournment Debate
And there is more in the same article, Mr. Speaker. Here are specific figures:
In July, foreign visitors-Americans mostly-made 5.6 million
trips to Canada. This may look good, but it indicates a decline of 4.7
per cent over the same month last year.
So, Mr. Speaker, clearly Air Canada's problems have nothing to do with the oil crisis, but they can indeed be traced right back to the economic crisis created by the Minister of Finance, a made-in-Canada crisis. Should he stubbornly maintain his high-dollar monetary policy you can be sure that tourist-particularly Americans who usually come up to Canada in droves-will find our costs prohibitive and travel elsewhere. We are already beginning to see the economic impact on that industry.
Mr. Speaker, to prove that these economic policies are a disaster for Canada, we had the same day-I don't know whether it was a day for bad news-the 23rd of October, another article in the same La Presse, intitled "Competitivity decreasing in Canada". In the 1980s, Mr. Speaker, we were ranked second, but we are now sixth.
This is unacceptable! How can we stay competitive, now that we are in the 1990s and that the 21st century is fast approaching? If the minister sticks to its policies, we are sure to have a "made in Canada" economic disaster. He often refers back to the years 1981-82, but we were going through an international crisis then. What we are facing now is a made in Canada crisis resulting from the monetary policy of the Minister of Finance, the high Canadian dollar policy which is hurting the tourism industry terribly as we have said earlier. The high interest rates policy, which results in a much stronger Canadian dollar, is most harmful to Canadian manufacturers who are unable to keep up with the competition because of high financing costs. They must incorporate those additionnal costs into their operations and that is why prices are increasing.
That is all there is to it, Mr. Speaker! And when the Minister asked me if I had any suggestions, I said to him that he should first lower the interest rates. He should do it as soon as possible so as to restore confidence within the industry, create employment and have people working again. This would in turn bring about a viable economy and we could consider the future with some hope.

November 6, 1990
Adjournment Debate
Mr. Speaker, you are signalling that my time is up now. I hope that the Parliamantaiy Secretary, who will be answering on behalf of the Finance Minister, will give us some indication that a considerable reduction is to be anticipated when the Bank of Canada announces the prime rate this week, as it does every Thursday, so that Canadians can continue hoping for a better future.


James (Jim) Stewart Edwards: Mr. Speaker, this government recognizes that the Canadian economy is now going through an adjustment period that is a source of difficulties for many Canadians.
However, given the excessively rapid growth of these last years, the present economic slowdown should surprise nobody nor create a feeling of crisis.
This is normal in a period of strong growth when the demand for goods and services outpaces the productive capacity of the economy.
The vigorous expansion of our economy during the last seven years made for a tight supply on the labour and goods markets, resulting in destructive inflationary pressures. Had we not reacted immediately to dampen inflation, pressures could have built up in our economy and it would have been much more difficult and costly to eliminate them later on.
That is why this government developed and implemented wise fiscal and economic policies in order to better balance demand and supply while alleviating inflationary pressures. This will lead to a drop in interest rates and a return to a balanced and sustained growth.
We are in the middle of the adjustment period. We are aware that these adjustment periods always bring some real difficulties. However, it is important that Canadians recognize that these changing economic conditions ease the inflationary pressures that push up prices and business costs, erode competitiveness and jeopardize the jobs of Canadian workers.

I want to assure the hon. member that we are fully sensitive to how important the course of monetary conditions will be for the operations of business and our economy as a whole. Many voices have called on the government to lower interest rates in order to revive economic activity and avoid further job losses. However, attempts to create employment through an inflationary monetary policy would be self-defeating. It is critical that all participants in our economy recognize that the government's scope to alter monetary conditions depends directly on the continued reduction of inflationary pressures.
I wish to assure the hon. member that the government remains committed to the economic agenda followed since 1984. It is also creating the conditions for sustainably lower interest rates and balanced sustained growth.


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 5.58 p.m.
[Stage Direction]
Wednesday, November 7,1990