1990-02-08

Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, I rise on a point of order to bring to the attention of the Chair some concerns that the broadcasting of the proceedings of the House is being done in a manner which in fact is anticipating a decision of the House on the report of the Standing Committee on Elections, Privileges, Procedure and Private Members' Business.
The committee is recommending in paragraph 3 of its ninth report that: "The programming director should be responsible for the production and direction of the broadcasting of the House of Commons, subject to the overall direction of the monitoring committee of the House of Commons."
Clearly, the committee did not like the way that the House is now televised. In its report, it described the current rules as unnecessarily strict and then gave us a synopsis of those rules: "Camera shots are restricted to the torso and head of the person speaking, and the microphone picks up only his or her voice- Strict rules for the cameras have prevented certain events from being shown and the full flavour of the House of Commons from being conveyed. For instance, the cameras are unable to show a member crossing the floor, either to join another party or to congratulate another member."
I do not wish to express either agreement or disagreement with the committee's views. That is a matter for the House to consider at another point in time.
I do wish to raise a concern that the guidelines under which the House has been broadcast for the past 11 years seem to have been changed. Yesterday, during the very warm tributes to the outgoing Leader of the Official Opposition, the right hon. member for Vancouver Quadra, the cameras did, in fact, show the Prime Minister crossing the floor to congratulate the member.
The cameras also showed you, your Honour, leaving your chair, walking toward and shaking the hand of the member for Vancouver Quadra. The cameras also showed wide-angled views of the House which enabled viewers to see the response of the House, in this case a standing ovation for these tributes to the hon. member. There is no question, Mr. Speaker, that these shots were good television and accurately reflected, in a positive way, what occurred in the House yesterday.
However, over the past year, a number of memorable, if not historic events have occurred in this Chamber. When the newly elected Leader of the New Democratic Party, the member for Yukon entered this House, in itself an historic event, the cameras did not show the reception that she received by all members of this House, but particularly from the women members of this House, on her important milestone.
As a member of the Committee on Elections, Privileges, Procedure and Private Members' Business, which authored the ninth report which makes those proposals-


An hon. member:: You were not there.


Iain Francis Angus: No, I was not an active member and the member for Sault Ste. Marie was replacing me. However, as a member of that committee, I know that this House has not been seized with the matter, it has not deliberated on the recommendations, therefore, the rules have not been changed.
Beauchesne's, Sixth Edition, sets out in citation 1122:
The electronic record is provided for informational purposes,
similar in intent to that of Hansard-

February 8, 1990
Point of Order Citation 1123 states:
The coverage by the House television cameras is based on certain understandings arrived at by the committee which supervised the installation of the system, and the resolution of the House passed on January 25, 1977. In principle, it is to be an electronic Hansard. When a Member is recognized by the Speaker, the participation of that Member is recorded. Just as Hansard does not record the reaction of the House in an editorial manner, neither does the camera coverage.
I raise two specific points. I would ask Your Honour that you review the tapes of yesterday to determine if, in fact, what I have just stated to the House is accurate, and if it is accurate, to determine how it came about. Was there a policy decision made by an appropriate official, or was it an independent decision made by a technician?
Second, and I think more important, given that if there is an error in Hansard, the printed record of this House, which is the official and only record, corrections can be made. However, if there has been an error in the electronic version, and recognizing that it is not the official version, where the camera showed that which it was not supposed to show, is it appropriate for the Speaker to have that record edited?
This is a very substantive question, Mr. Speaker. In the past, giving permission to edit has not been not allowed. One is not allowed to edit in any way the electronic recording of this House, whether visual or audio. However, in this instance, should you order that the record of yesterday be edited to exclude those camera shots which violated the rules of this House? I am not necessarily arguing that you should, Your Honour, but I think it is a question that you and this House have to deal with, particularly inasmuch as we have not approved or even considered the ninth report of the committee, and it may be something to which you may wish to refer back to the Elections and Privileges Committee for further consideration.


Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, not being a member of the committee I would like to defer perhaps to the member for Kingston and the Islands for his comments but I would like to say a few things. First of all, I understand that the televising of the proceedings of the House is in the hands of a very competent staff of technicians and producers. I recognize the present rules state that the camera is allowed to show only the person recognized by the Speaker, or the Speaker.
Yesterday's events showed you leaving the chair and coming to shake the hand of the Leader of the Official Opposition, now the right hon. member for Vancouver Quadra. In my view, that was a very touching move on your part. In my view, that was a very human move, something that I thought was appropriate in the spirit of the House at that time.
The cameras were indeed following you, Mr. Speaker, which is exactly and technically correct, as far as I am concerned, because the cameras must stay on the Speaker. In my view, you should be commended for this very human, personal touch that you put to this event yesterday.
I realize that some people may say that you did divert, change or modify your normal behaviour of staying in the chair. In the view of the Liberal opposition, even though we do recognize and we were actively involved in presenting the ninth report to the House, which proposes certain changes to the broadcasting of the proceedings, I want to tell you that we are entirely supportive of what happened yesterday and we thank you for it.


Mr. Speaker:: I want to say to all members of the House that I have listened very carefully to the hon. member for Thunder Bay-Atikokan. I have to say it is my opinion that his complaint is justified. I do not take anything that the hon. member for Thunder Bay-Atikokan said as a personal criticism of me. I know the hon. member very well and I know his colleagues. He and his colleagues, my former colleagues from the party from which I come, and my colleagues in the Liberal party will know that my association with the right hon. gentleman we honoured yesterday goes back for many years. I think that all hon. members will understand that when I think back to my boyhood, the same people who raised me are the veiy close friends of the same people who raised the right hon. gentleman. There is an association that crosses the years and crosses party lines. I know that the hon. member for Thunder Bay-Atikokan and my very good and dear friend, the hon. member for Kamloops, understand.
The complaint made by the hon. member for Thunder Bay-Atikokan is legitimate. It is legitimate in the sense that not all of what happened yesterday was covered. Our colleague, the hon. member for Yukon, the new and distinguished Leader of the New Democratic Party, in an act of generosity and goodwill, of which this House is capable but which is not often recorded or seen, came up
February 8, 1990

this aisle. She did not need to, but she did, and shook the hand of our right hon. friend.
That was a dramatic moment in this Elouse, as was also the fact that the Prime Minister of our country crossed the floor on this occasion and shook hands with our right hon. friend.
These are moments in the history of our country that probably ought to be recorded. That is as far as I will go because I am your servant and I must be guided by the strictures that you have decided to place on television coverage of this place.
I want to say to my hon. friend from Thunder Bay- Atikokan and my hon. friend, the House Leader of the New Democratic Party, the hon. member for Kamloops, and other members of the New Democratic Party that I am very sorry if the coverage was not complete. I think the complaint that has been brought to me is legitimate and I will do what I can to make sure it does not happen again.
What I do have to say to all hon. members is that there are times in a long lifetime that we all do things because of memory, circumstance, friendships and long associations.
I have to tell all hon. members-and I know that it will be accepted by the New Democratic Party-for associations that go back many years, I did what I did yesterday, and I am sorry that it was covered and another equally touching tribute from the New Democratic Party was not covered.



ROUTINE PROCEEDINGS


Mr. Albert Cooper (Parliamentary Secretary to Government House Leader):: Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government's response to 115 petitions.
[Editor's Note: See today's Votes and Proceedings.]
Routine Proceedings BROADCASTING ACT


Mr. Ian Waddell (Port Moody-Coquitlam) moved: for leave to introduce Bill C-284, an act to amend the Broadcasting Act (distribution undertaking).


Mr. Speaker:: Shall the hon. member have leave to introduce the bill?


Some hon. members:: Agreed.


Ian Gardiner Waddell: Mr. Speaker, it is with great pleasure that I present this bill. Cable television rates increased on average by 6 per cent annually between 1984 and 1988 but by 29 per cent between 1988 and 1989. We could ask anyone watching us today and they would indicate that those rates have increased.
Second, the big cable operators such as Ted Rogers and Company have really been given a licence to print money.
What this bill does is applies the same principles to cable companies as are applied to phone companies. In other words, this outrageous rate of return is going to be regulated, just like phone companies are regulated under the Railway Act.
In the past year, telephone rates have actually gone down, whereas cable rates have gone sky high. The bill states that it is not enough just to give the CRTC broad discretion. The government has to direct that the cable companies will be regulated. This is what this bill does.


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


Mr. Benno Friesen (Surrey-White Rock) moved: for leave to introduce Bill C-285, an act to amend the Canada Shipping Act (pollution).


Mr. Speaker:: Shall the hon. member have leave to introduce the said bill?


Some hon. members:: Agreed.


Benno Friesen: Mr. Speaker, this bill was inspired by a newspaper article in Vancouver some time ago which indicated that some of the tankers owned by Esso carry

February 8, 1990
Routine Proceedings
on board temporary booming equipment should there be a spill.
That would at least provide temporary containment of a spill until the larger equipment could be brought along.
Those of us who have coastal communities as our constituencies realize how vulnerable we are for any oil spill. Again the news last night carried the report of a spill in California.
This bill requires that all tankers in Canadian waters would be required to have temporary booming equipment on board in order to give temporary protection until the permanent equipment would come along.


Mr. Speaker:: I thank the hon. member for the explanation. I think it will be a matter of considerable interest to all members.


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

Mr. Nelson A. Riis (Kamloops):: Mr. Speaker, it is my pleasure and honour to present a petition on behalf of a number of petitioners from various communities, including Blue River, Avola, Vavenby, Birch Island, Clearwater, Black Pool, Wells Gray Park, Adams Lake, East Barriere Lake, Little Fort, Chu Chua, Darfield, Chinook Cove, Barriere, Louis Creek, McLure, Vinsulla and others.
The petitioners are pointing out their concern that the government's proposed goods and services tax is an unfair form of taxation because it lacks regard for taxpayers' ability to pay the tax. It imposes a tax on everything from piano lessons and diapers to coffins and even consumer loans which some Canadians must take out to pay their taxes.
The petitioners go on at some length and ask Parliament to do whatever it can to cause the government to back off from proceeding with this goods and services tax.


Jean-Robert Gauthier: Mr. Speaker, I have the duty on the same day that this House has adopted second reading of Bill C-62, the GST bill, to
table a petition sent to me by people from Milk River, Alberta.
The petitioners state that the present federal manufacturers' tax has already been increased by the federal Tory government from 9 per cent to 13.5 per cent, that is four times over a period of five years, and that the federal government wants to impose upon Canadians a new 7 per cent tax on goods and services which will be hidden from Canadians and applied to virtually everything they buy.
These people feel that the imposition of this new general goods and services tax will cause serious and unfair hardship to low and middle income Canadians. They join with Liberals and strongly oppose the new goods and services tax which is an unprecedented tax grab from the pockets of Canadians and will hit them not only with higher taxes but with higher inflation, higher interest rates and higher unemployment.
The undersigned humbly pray and call upon Parliament to reject the proposed goods and services tax.


Mr. Jesse Flis (Parkdale-High Park):: cise of its constitutional power of disallowance with respect to Bill 178 of the province of Quebec.
This petition is time sensitive. I could not table it any earlier because of the government's procedure of moving to the Orders of the Day. Mr. Speaker, I hope you will take this into consideration when you are looking at this petition. It is not the fault of the petitioners that it arrived late in this House. It is the procedures by which we are guided.


Mr. Speaker:: On behalf of the hon. member for Parkdale-High Park I want to say to him and to the petitioners that he represents that I fully understood the difficulty a few days ago. I understand his comment and while I would not normally intervene I want to say to the petitioners through my colleague that we understand the difficulty.


Jesse Philip Flis: Mr. Speaker, I have a second petition, also from the constituents of Parkdale-High Park. They argue that the Government of Canada has seen fit since Confederation and without hiatus to apply a zero rate of tax to magazines, books and newspapers and now propose to include them in the GST. They argue that uninhibited dissemination of the printed word is a cornerstone of democracy, culture, education and literature, and productive society will be negatively affected by the GST application.
The petitioners call upon Parliament to reaffirm the historic principles embodied in the tax-free status for the printed word by retaining the zero rate in the GST legislation and regulations.


Mr. Lyle Dean MacWilliam (Okanagan -Shuswap):: Mr. Speaker, it gives me pleasure to rise under the provisions of Standing Order 36 and present 127 petitions that are grouped together to facilitate their movement through the House. These petitions have been signed by 3,325 residents, the vast majority of whom are in the Okanagan-Shuswap area.
This brings the total number of petitions against the government's goods and services tax from the Okanagan-Shuswap to 311, signed by over 14,700 residents of the area. This represents 28 per cent of the registered voters in the Okanagan-Shuswap.
Routine Proceedings
These petitions come from the North Shuswap, Salmon Arm, Enderby, Armstrong, Vernon, Lumby, Sica-mous, Sorrento and Falkland. I think the fact that these signatures represent over 28 per cent of the voting population in that constituency is a very clear message to the government that people in Okanagan-Shuswap are certainly very disturbed about the goods and services tax.
Through the petition they have asked that this government reject the proposed goods and services tax and that this government consult with business, labour and consumer groups to reach a broad consensus on reform of the tax system before implementing further changes. Finally, they ask that there is a process of fair tax reform that will provide a healthy climate for future economic growth in Canada. The people of Okanagan-Shuswap have spoken loudly and clearly. Stop this tax.


Mr. Maurice Foster (Algoma):: Mr. Speaker, I have the pleasure to present three groups of petitions from constituents in Manitoulin Island, Gore Bay, Evansville, Spring Bay, Little Current, Tehkummah, Manitowaning and Mindemoya, calling on the government not to implement the goods and services tax.
They point out the adverse impact this will have for senior citizens. The higher taxes are not appropriate at this time. It will cause higher inflation, higher interest rates and higher unemployment.
I hope that the government will take into account these representations, made by these people who are veiy concerned with the possible implementation of the goods and services tax.


Mr. David Barrett (Esquimalt-Juan de Fuca):: Mr. Speaker, with your permission, I am the surrogate today for our former leader, the Hon. Ed Broadbent. On his behalf, I am submitting these petitions from people of Ontario and the region from which he formerly represented.
Gone but not forgotten in the hearts of his constituents, he is still their member of Parliament. As a consequence, they have submitted these particular petitions to me to be his vehicle and his presence here today.
Not to my surprise, but perhaps the government's surprise, this petition is focused on the goods and services tax. I can see there is a groundswell of public opinion in the Oshawa area that represents a significant part of Ontario that says clearly through this petition,

February 8, 1990
Routine Proceedings
that they are frustrated, angry and deeply hurt over the goods and services tax.
Their petition says that they would pray that this government would do its utmost to delay the bill and permit those taxpayers a greater opportunity to present their feelings, perhaps through an election, simply on this issue, which would be a fair and democratic step.
They are suggesting that the government go to the people and have the people approve, in a democratic process, whether or not they agree with this tax. Even though the polls show that 80 per cent of the people are opposed to this tax, it may not be reflected in an election and the government should take the bidding of these petitioners and poke its feet in the water of an electoral process.
I submit these petitions on behalf of the good burghers of the Oshawa, Ontario area.


Iain Francis Angus: Mr. Speaker, pursuant to Standing Order 36,1 have the honour and the duty to present a number of petitions signed by 920 residents of my area. These petitions have been circulated by a number of business people in the community, Galaxie Lanes, the staff of St. Jude schools, Ziebart, Family Diner, Northern Women's Centre, Breenie's Auto Body, Lochloman Ski Area, Superior Bowl-o-Drome and one petition that was circulated on VIA Rail when it was still running.
The petitioners are all against the GST. They want the current proposal rejected and they want a proper reformation of the taxation system so there is an effective minimum tax on wealthy individuals and corporations.


Ms. Dawn Black (New Westminster-Burnaby):: Mr. Speaker, I rise again in the House under the provisions of Standing Order 36 to present petitions on behalf of small business people in my community.
Small business people in my community continue to send petitions and letters in opposition to the GST. In this petition hundreds of small business people from New Westminster, Burnaby and other areas of the lower mainland in British Columbia say that this form of taxation is unfair because it forces small businesses to carry a disproportionate share of the tax burden.
These small business people say that this will be an implementation nightmare for them, and that this tax does not address the concerns of small business in regard
to the current federal manufacturer's sales tax and that, instead, it increases the tax burden on the small business community.
They call upon this Parliament to reject the proposed goods and services tax, to consult with business, labour, and consumer groups, and to reach a broad consensus on reform of the tax system before implementing this regressive alternative to the manufacturers' sales tax.
They ask for real reform of the tax system to provide a healthy climate for small business in Canada.
I have presented other petitions from small business people in my community and these are more in opposition to this tax.


Mr. Doug Fee (Red Deer):: Mr. Speaker, it is my privilege to present a group of petitions which have all been certified correct as to form and content pursuant to Standing Order 36.
These petitions have been signed by over 300 people, all members of four different churches in the city of Red Deer. They represent members of the Church of God, the Roman Catholic Church, the Baptist Church and the United Church, all of whom call upon Parliament to formulate and legislate a law to protect life from conception, a law which seeks to save the life of both mother and child.


Mr. Guy H. Arseneault (Restigouche -Chaleur):: Mr. Speaker, I have a number of petitions signed by people who object to the new goods and services tax. They say it will be the worst tax levied on Canadians since the beginning of our history.

These petitioners tell us that as it now stands the GST would create economic disruption, increase taxes on average families, introduce an unprecedented level of complexity into the tax system, impose further hardship on low-income Canadians, and remain hidden from taxpayers.
They call upon the House of Commons to withdraw this tax.
February 8, 1990


Mrs. Pauline Browes (Scarborough Centre):: Mr. Speaker, it is my pleasure to present to the House of Commons today a petition concerning the preservation of the Rouge Valley which is 10,000 acres of beautiful natural wilderness geography in Canada. The petitioners are from communities of Oakville, Scarborough, Etobicoke, Thornhill, Whitby, Bolton, Kitchener and Norwood.
This issue of the preservation of the Rouge Valley as a precious natural area is spreading right across Ontario, right across Canada. It is in the national interest to preserve the wildlife and wilderness aspects of the area. There are thousands of people who are working in the Save the Rouge Valley System organization.
These petitioners call upon this government to work with the province of Ontario which owns about 80 per cent of this beautiful land, to have the Rouge Valley system preserved as a park.


Mr. Speaker:: The hon. member for Bonavista-Twilling-


Mr. Mifflin:: Trinity-Conception.


Mr. Speaker:: Trinity-Conception. I apologize to the hon. member but the former name of the riding is almost part of the history of the country and I have to keep in mind that for administrative reasons it has been changed. Of course it takes nothing away from the representation that the riding has in this Chamber.


Fred J. Mifflin: Thank you, Mr. Speaker. If I may, those comments are very appropriate in view of the fact that some of my colleagues and I had the delightful experience to dine with the former member for Bonavista-Twillingate to whom I am sure you are making reference. A delightful dinner it was!


Mr. Speaker:: Before the hon. member goes too far I just want the hon. member to know, and I think his constituents should know, that I have had the great privilege at least once a year of dining with the former hon. member and I want the hon. member to know, and I want his constituents to know that I hold their former member in the highest esteem.
Routine Proceedings


Fred J. Mifflin: Thank you very much, Mr. Speaker. I will convey that message to my constituents. And, Mr. Speaker, the present member is doing his best to hold himself in that kind of respect as well.


Mr. Young (Gloucester):: You are doing a marvellous job!


Fred J. Mifflin: Thank you, to the hon. member.
Mr. Speaker, I rise pursuant to the provisions of Standing Order 36 to present a number of petitions. The House might be interested to know that I have received 15,000 petitions on this subject, representing 35 per cent of my voting population. There are 1,130 signatures on this particular petition from one end of my riding to the other: Lumsden, Traytown, Bonavista, Queen's Cove, North West Brook, Clarenville, Bellevue, North River, Harbour Grace, Carbonear, Northern Bay, Bay de Verde and I could go on.
People in my riding basically do not have high incomes. They are concerned, for example, that Canadian families with incomes of between $10,000 and $15,000, spend 92 per cent of their income on current consumption, while families earning in the vicinity of $50,000, spend only 56 per cent on current consumption. They are concerned that they are paying almost all of their income for essential purposes and now they are being asked to pay, on top of the 92 per cent on consumption, another 7 per cent.
They feel that this is blatantly unfair and unjust. As one of my cogent and well-expressed constituents said to me, it was inexpressibly distressing.
These petitioners pray and call upon Parliament to show some heart, some compassion for the situation in which they find themselves. They wish to have the proposed goods and services tax firmly, soundly and decisively rejected.


Mrs. Shirley Maheu (Saint-Laurent-Cartierville):: Mr. Speaker, I have the honour and the privilege of presenting, pursuant to Standing Order 36, a petition from people in the province of Quebec, Montreal, Chateauguay, Pierrefonds, Roxboro, lie Perrot, St. Hubert and Lacolle.

And also my own riding, Saint-Laurent.

February 8, 1990
Routine Proceedings

The petitioners are asking the government to reject the proposed goods and services tax because the imposition of this tax will cause serious and unfair hardship to low and middle-income Canadians.


Mr. Jim Karpoff (Surrey North):: Mr. Speaker, I rise pursuant to the provisions of Standing Order 36 to present a petition signed by a number of Canadians who point out that the government has not addressed the unfair tax system which is currently in place, which permits wealthy individuals and corporations to pay little or no federal tax, while forcing low and middle-income taxpayers to bear more of the tax burden.
They call upon the government not to proceed with the current goods and service tax, but to bring in fair taxation for all Canadians.
Ventures and Royalty Charters issued (by year) over the last five years (b) the species allocation and location allocation for each (c) the names of the brokers and foreign vessels associated with each of these ventures?


Hon. Thomas Siddon (Minister of Fisheries and Oceans):: In 1985 and 1986, the Tomgat Co-op and the Labrador Fishermen's Union Shrimp Company (LFUSC) were the only northern shrimp licence holders authorized to use foreign vessels under so-called royalty charters. The vessels used were the Ocean Prawns, a Faroe Island vessel, by Tomgat, and the Helen Basse, a Danish vessel, by the LFUSC. Since 1987, such charters have not been permitted. Northern shrimp licence holders have been given permission to enter into Joint Venture Business Arrangements with foreign partners. Canadian equity in such joint ventures must be at least 30 percent and must be Canadianized (i.e. over 50 percent ownership) by May, 1990.


Mr. Brian L. Gardiner (Prince George - Bulkley Valley):: Mr. Speaker, let the House not forget the New Democrats are putting up the best fight possible to stop the goods and services tax. The petition I have to table in the House today under the provisions of Standing Order 36, is to remind the House of the call to the Minister of Finance to reject the task force report on northern tax benefits which was unfair and should be addressed by the Minister of Finance when he brings down his budget later this month.
All northern shrimp vessels can process shrimp on board and are not required to land in Canada. However their product must be labelled "Product of Canada" and is subject to Canadian inspection.
Following is the list of joint ventures with foreign partners in the northern shrimp fishery for 1987 to 1989; the foreign vessels used in 1985 and 1986 are identified above.
These vessels fish for shrimp in NAFO Areas 0, 2 and 3KL.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Albert Glen Cooper: Mr. Speaker, question No. 205 will be answered today.


Mr. LeBlanc (Cape Breton Highlands-Canso): Are Native Groups given Royalty Charters (special quotas) for Canadian fish stocks and is it possible, under a Joint Venture Business Arrangement, for businessmen out of Ottawa, Montreal and other centres to secure a licence for foreign fleets to catch these species and then process their catches in European countries such as England and Denmark and, if so, what are (a) the names of all Joint
Licence Holder
Pikalujak Fisheries
Tomgat Co-op
Caramer Ltd.
M.V Osprey Ltd.
Fishery Product International


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


The Acting Speaker (Mr. Paproski):: The question as enumerated by the parliamentary secretary has been answered. Shall the remaining questions be allowed to stand?


Some hon. members:: Agreed.
Vessel
Faroe Prawns Ocean Prawns Arctic Viking Hvitanes Hvilvtenni
Country of Origin
Faroe Island Denmark Faroe Island Faroe Island Faroe Island
February 8, 1990



GOVERNMENT ORDERS


M. Douglas Young: That this House call upon the government to abandon its ill-conceived goods and services tax scheme and to bring forward in its place a comprehensive reform of the tax system that is fairer, simpler, integrated, taking into consideration all forms of taxation and the needs and practices of other levels of government and that this be clearly visible to the taxpayers and designed in a manner that does not merely, under the guise of reform, constitute another increase in the overall burden of taxation.
He said: Mr. Speaker, I know that there will be a great deal more said in the weeks and months to come about the goods and services tax. I know that many of my colleagues wish to speak to this motion. I deeply regret that many members of this House have not had a full opportunity to debate the goods and services tax because closure was imposed by the government.
There has been a great deal of discussion about alternatives or the lack thereof, and the need for real tax reform. In my opening remarks I want to set out what is not tax reform. After five years of Conservative government I want to review some of the results of the tax reform that allegedly was undertaken by the Minister of Finance and the Conservative government.
In 1983-84, government revenues were $64 billion and the public debt was $160 billion. After five years of tax reform, in the year 1991 this government as a result of 31 tax increases now is generating revenues to the Government of Canada of $120 billion. These are obviously not final figures but the government's own numbers which I expect will change and unfortunately for Canadians for the worse. Revenues have gone from $64 billion to $120 billion in five years. That is the tax reform tax grab that this government has put in place.
While government members during the election campaign in 1988 were bragging about their ability to manage the economy and to manage the affairs of this nation, we went from a public debt in 1983-84 of $160 billion to a total projected debt at the end of this fiscal year of $380
Supply
billion. In five years of Tory tax reform and alleged good management, from $160 billion of public debt to $380 billion.
The point I want to make is that that is not tax reform. That is not good management. It is a sad commentary on the inability of the Minister of Finance to be able to manage the economy of this country and the spending of this government. It has been able to demonstrate clearly that it is the all-time taxing champion of Canada. It has found more ways and has been more aggressive in dipping into the taxpayers' pockets than any government in the history of this country, and at the same time spending to a point where it has more than doubled the national debt.
One of the fundamental commitments of the Minister of Finance and this government was to address the question of the deficit. The fact of the matter is that the deficit has been increasing in the last few years, not decreasing. The deficit has risen from $28.1 billion in 1987-88, to $28.7 billion in 1988-89, to $30.5 billion in 1989-90. Regardless of projections made so far by the Department of Finance, at least those which have been released, I believe that the deficit for this year will again increase above the $30.5 billion that it was last year. The government has increased revenues by nearly $60 billion while being unable to address in a meaningful way the deficit and while doubling the national debt. I reiterate, this is not the way to deal with tax reform nor fiscal responsibility.
Among the problems that this government has faced is the question of high interest rates. After five years of Conservative management of the economy our interest rates are 4 per cent higher than those in the United States. Traditionally, we were always able to keep them within a half point to a point, a point and a quarter.
Many people attribute this to the free trade syndrome and other reasons.
To be fair to the Minister of Finance, I do not lay the blame for the deficit, the debt and the high interest rates at his doorstep. I blame it on the lack of will of his government, because I think the Minister of Finance has been left to hang, to spin on his own. The government has read the polls, and although the Minister of Finance may have been well intentioned and may have had a plan initially, he believed that he could carry through and he

February 8, 1990
Supply
has not been able to do so. I suspect it is because the government has refused to do what needed to be done.
When we debated the goods and services tax, I heard over and over again from members opposite that there is no alternative to the goods and services tax being proposed by the Liberal Party. That is the canard. That is the problem that Canadians have to address. One of the things, of course, that we have to recognize is that in 1984, when this government came to power, the manufacturers' sales tax was generating somewhere in the neighbourhood of $8 billion in revenue. The new goods and services tax will generate $26 billion, over three times more. Yet, they say: "What's your alternative?"
I believe that the people who have signed the petitions that have been presented to this Elouse, the over 300,000 signatures that we have been responsible for, have said that the alternative for the short term is the status quo. Yes, there are problems with the manufacturers' sales tax and yes, there have been a myriad number of reports saying that we have to get rid of it, but this is not the way to go.
Our motion talks of tax reform and I believe that that is what we have to do. We have to take the responsibility in this place to talk to Canadians about tax reform that will address the problems of generating revenues, to maintain for Canadians the infrastructures that we require and the social programs we need. When we look at the municipal tax systems, the provincial tax systems and the federal tax system, we see it has to be an integrated approach, because there is only one taxpayer in Canada. That taxpayer pays municipal tax, provincial tax and federal tax.
It is not as though the Minister of Finance, when he brings down his budget in two weeks, can say that this is only going to affect the federal taxpayer. It is going to affect every Canadian taxpayer. We have to look seriously at the suggestions made before the Standing Committee on Finance by the mayor of Vancouver who made it clear that there are only so many dollars available from Canadian taxpayers, and we cannot play games by shifting burdens from one level of government to the other because, in the final analysis, Canadian men and women have to foot the bill.
I believe that in tax reform we have to address the question of real property taxes. Are real property taxes still a legitimate way of generating revenues? Are they a true measure of people's ability to pay, or have they become location taxes? If you have a $100,000 home in my constituency in northern New Brunswick and you have $100,000 home on the outskirts of Toronto you very likely have the same home. The only difference is that the property in Toronto will cost a lot more because you are paying for the land underneath the home. The home and its facilities are probably very similar. Is this approach still feasible or should we be looking at new approaches? Should we be deciding on progressive ways to raise the revenues required to function in this country?
The alternatives that we believe must be considered in tax reform, and that we recommended in the minority report that we presented subsequent to our study of the goods and services tax proposal, is to look at all forms of taxation. We have to look at what economists, bank presidents, business people, anti-poverty groups, the National Action Council, Canadian Labour Congress, talk about when they talk about equitable, progressive taxation.
Many of these people have excellent suggestions on how we can deal with tax reform in this country. We can eliminate tax breaks and we can make sure that everyone is treated fairly. We have to look at the business sector. I want to be very clear on this. In the Liberal Party we believe that tax reform must provide for a strong economy and must provide for initiatives for men and women to become involved in the private sector. I want to say clearly that I do believe in profits, I do believe in rewarding hard work and I do believe in making sure that people who take a risk can expect a return on their investment.
Business in this country is prepared to respond to tax reform as long as it is fair and allows them to compete internationally. The time has come to deal in a straightforward way with tax reform for individuals and corporations. We have to make sure that the system in place is not only fair, or as fair as we can make it, but that Canadian taxpayers believe it is fair.
That is why they do not accept the goods and services tax. Nobody likes taxation but Canadians do not believe the goods and services tax is fair. They do not believe
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either that the revenues generated by the goods and services tax are going to be spent properly.
We recommend that as we go through the exercise of tax reform in this country there also be an effort made with regard to what is happening to government spending, with regard to where we are on fiscal reform. How are we going to address the question of dealing with municipal, provincial and federal spending requirements in a restrained and responsible way?
There are no easy answers to this. People suggest it will take years. I have heard people suggest royal commissions. I do not think we need a royal commission. I believe we need to have leaders in the three levels of government who are well supported and who understand the problems come together and talk about an integrated tax reform.
People will be very quick to suggest, when we talk about tax, that they want the lowest taxes possible, but when we talk about spending they want as much spending as possible as it applies to them, but very little for anyone else.
I do not think we should be afraid of looking at reform of taxation from the point of view, as I suggested, of real property taxes. I do not think we should be concerned about looking at taxing wealth in this country. I do not think we should be concerned about clamping down on people who do not pay their taxes.
I think Canadians would be absolutely appalled if they could sit with the Auditor General of this country, as I did this morning, and hear him suggest that tax avoidance is an extremely serious problem in this country. There is tax avoidance in this country through under the table transactions because there is not sufficient audit, because there are loopholes and because many people make their living in this country searching on a daily basis for ways to avoid taxation.
For example, I wonder how many Canadians know, disregarding the tax situation where people are able to hive off or, through holding corporations, avoid some tax, that we have between $7 billion and $8 billion in receivables in our tax system. That seems to me to be an enormous amount of money.
People are always concerned about corporate taxes. It is often said that if we address the corporate side with
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taxation in the end it is the consumer, the ordinary Canadian, who pays for it because it is always passed along. Corporations as legal entities do not of themselves pay taxes. It is the people who own shares in the corporations and the people who buy the products that they produce or the services that they produce who in the end pay the price.
There are innovative and creative ways of looking at corporate activity in this country, whether it is domestic corporate activity or through multinationals. We can look at how to deal, for example, with profits as deemed dividends in the hands of shareholders.
What I am suggesting to my colleagues in the House today is that tax reform is possible because so many people are thinking about tax reform. As many people are talking about fiscal reform. Finally, many Canadians are talking about monetary policy. If we speak of tax reform on the basis of an integrated review dealing with federal, provincial and municipal taxation, we must also look at what we are doing in terms of our tax policy, what we are doing in terms of our fiscal policy, what we are doing in terms of our monetary policy and how they fit together. Are we doing one thing with the left hand, another with the right, and trying to tap dance as we go through the exercise of administering the affairs of this country?
I believe that Canadians are at a point where they will not pay any more taxes. I do not ascribe to the view, as some people do, that a tax revolt is imminent because Canadians are too generous to get into the kind of tax revolt that we have seen in the United States. Canadians will not say that we are going to cut social spending, cut spending on education and cut spending on medicare without looking at the over-all picture.
There is a deep malaise among Canadians with respect to spending. I do not think we want to have any knee-jerk reflexes and simply say sure, go out and cut $20 billion, $30 billion or $50 billion. As parliamentarians and politicians we have to ask Canadians how we reduce spending, not how the Conservative Government of Canada reduces spending or the Liberal Government of New Brunswick reduces spending, but how we together evolve a program that Canadians understand and perhaps accept because they have had a role to play in determining that program.

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How do we create a climate of trust that in fact politicians can manage billions and billions of dollars? How many people involved in these major corporations, both domestically and nationally, are being asked to make the tough decisions when suggestions are made that government spending is out of control? How many of them are prepared to say: "This is where we believe you should cut. This is specifically the program we think you should diminish or eliminate".
I think the challenge is not just for politicians. The challenge is for Canadians. Can we together discuss real tax reform? Can we agree on what must be done to serve the needs of Canadians from all walks of life, corporate as well as private?
How do we control our spending and how do we relate in our relationships with our trading partners, especially the United States, because right now the United States is a dominant force with regard to interest rates and the value of the Canadian dollar.
I am trying as best I can to articulate the plea that I have heard all over this country as a member of the Standing Committee on Finance. Canadians are hit with taxes from every direction. They have no control over the taxes that are imposed on them and they believe they have no control on what is happening to those tax dollars when they are being spent. In my view that is a recipe for a great deal of unease among Canadians on a lot of other issues that are not directly tax or fiscally related.
In closing, I hope that the Minister of Finance, when he comes before this House with his budget in a few days, will recognize that there is a need to respond to the legitimate cry from Canadians for responsible tax reform, responsible fiscal reform and a monetary policy that reflects the best interests of Canadians both as individuals and as corporations and exporters.


Mr. Loiselle:: Mr. Speaker, I would like to tell the hon. member that both the tone and the content of his intervention are very refreshing. He has come forward with a lot of very positive suggestions. In this debate on a difficult issue which is vital for the future of our country it is very pleasant to have this kind of exchange across the floor even though we might not agree on everything.
The member has touched upon a wide range of problems in the fiscal area. He has referred to tax breaks. I think he knows that we as a government over
the last few years have eliminated dozens and dozens of tax breaks that the government formed by his party put into our system over the years.
He referred to corporations. I think he will agree, looking at the last budget and yet again at the measures we have taken recently to move from 9 per cent to the 7 per cent rate, that we have increased considerably their share. We will continue to look carefully at all the areas he has touched upon.
I will tell him that the magnitude of the problem we are facing is of replacing one of the central pillars of our income as a government. We have the income tax, the excise tax and the present federal sales tax which I appreciate he knows is a bad tax for this country.
I would like him to tell me why this approach is so bad when 48 other countries, most of them being large industrial countries like ours, have used this type of tax.


M. Douglas Young: Mr. Speaker, dealing with the last element of the hon. minister's comment and question first, the difficulty with the implementation of the goods and services tax is that we would be the only country with two levels of retail sales tax. The tax does not meet the very criteria set out by the Minister of Finance and the department in their initial presentation.
The difficulty with the goods and services tax, as it is presently put forward, is that in 1984 that tax was raising approximately $8 billion. The technical documents and the supporting material to the current proposal for the GST indicate that the government will be seeking to raise some $25 billion to $26 billion with this tax in the fiscal year ending in the spring of 1992.
It seems to me that with all the flaws of the existing federal sales tax, to replace it with another tax that is not capable of being implemented even according to the government's own criteria, is the problem. We could get into a debate on whether goods and services taxes are regressive, whether sales taxes on goods and services to consumers are regressive, but from a strictly technical point of view, even the Auditor General this morning was very circumspect in his comments, but I think one could interpret them to mean that it is going to be an administrative nightmare, not only for small business but for the Department of National Revenue and the
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Department of Finance to implement this on January 1, 1991.
To my friend, the minister, I would simply say that it is best to stay with the devil you know than to jump into some kind of an arrangement with the devil you do not know. The status quo, it seems to me, until we get it right, is far preferable than moving to this tax.
I do not want to take too much time but I want to comment on the minister's statement with respect to corporate taxes. I would simply point out very briefly that since the Conservative government has come to power it has increased corporate taxes a little more than 20 per cent, from 20 to 22.5 per cent, while personal income taxes have been raised by 45 per cent. That is part of the problem in dealing with this. Surtaxes remaining in place that were part of tax reform have, I think, exacerbated the problem of where the tax burden in the country lies and how it is being applied to both corporate taxpayers and individuals.


The Acting Speaker (Mr. Paproski):: I have three other questioners for the hon. gentleman; the hon. member for Esquimalt-Juan de Fuca, the hon. member for Saint-Laurent-Cartierville and the hon. member for Carleton-Charlotte. I will recognize the hon. member for Esquimalt-Juan de Fuca first.


David Barrett: Mr. Speaker, I share the feelings of the minister about the tone of this debate but I cannot quite go along with the substance. The tone is very good but the substance is what concerns me. For many years I have heard the appeal that we have to rise above politics and meet the challenges. I have heard these appeals on the basis that the business community has to do this and others do it. But are we not in politics? Is this not the forum where ideas are exchanged but decisions are made by competing parties wishing to be government; one is in waiting, and the third is hopeful that both will fail. That is the nature of politics. To suggest to this House that we have to meet this challenge by some vague method of pulling people together is avoiding reality.
We are in the blood and guts of politics. We stand for office because we have different ideas. I do not like the goods and services tax. My party has proposed an alternative. The member's party claims to be opposed to the goods and services tax, but I hear this flim-flam stuff about having to rise to meet the challenge.
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In order to make a decision as to who should govern them, Canadian people need to know. I give credit to this government for courage to press on with its ideas. I do not agree with its ideas, but it has had the guts to press on. Even if the government commits suicide, it is doing a good job.
But as we seek to replace the government, as the Queen mandates us to do this through Her Majesty's Loyal Opposition, it is the responsibility of the Official Opposition, and certainly of the third party, to state clearly, when asking for the confidence of the people to return them to office, that should they be returned to office and the goods and services tax is in place, they will immediately cancel it.
I have not heard that from the leadership candidates of the Liberal party. I have not heard that from the Liberal party. What we have is a touch of cynicism which I avoid even raising in an arena like this, but I must. The cynicism is that they are clucking and chucking behind the curtain knowing that the Tories are doing the dirty work for them. They do not have to give a commitment against this tax and they will keep it in place once they are elected in government.
My question requires a yes or no answer; no fudging, no hedging, no beating around the tax bush. Will the Liberal party say absolutely to the Canadian people, yes or no? If you are returned to office, do you pledge to immediately remove the goods and services tax? Yes or no?


M. Douglas Young: Mr. Speaker, the hon. member, as the premier of British Columbia, was very well known for iris yes or no answers.
I want to point out to my hon. friend that should the government majority be able to railroad the GST into place, thereby eliminating the federal sales tax and some $18 billion in revenue, when the Liberal government comes to power, it would be folly to state that that day-


David Barrett: Oh, oh! There it is my friend.


M. Douglas Young: To walk in and say that day that we are going to increase the deficit by $20 billion-


David Barrett: Oh, oh! Why don't you just vote for it and get it over with.


M. Douglas Young: The point is that when you deal with reality you are faced with a fiscal and a revenue generation system, as the hon. member for Esquimalt- Juan de Fuca knows from when he had, in another

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incarnation, to manage the affairs of British Columbia. We are very well aware of his fiscal policies.
I do want to say very clearly that our commitment to tax reform is based on a progressive tax system. The goods and services tax is a regressive tax. When tax reform can be implemented those kinds of regressive taxes will be eliminated in a responsible way.


Shirley Maheu: Mr. Speaker, we are aware that the government will bring down its budget very shortly.

Could the hon. member share with us what bad news he feels is in store for us at that time?


M. Douglas Young: Mr. Speaker, on the question of the budget, I think Canadians understand that on February 20 the Minister of Finance will come in and announce his budget. We are assuming it will be announced in the House and not somewhere else. When that does happen, I do not have any doubt that the minister will have to address the fact that his deficit will be substantially higher than what was projected last year. That has been a continuing problem for the Minister of Finance.
I think that the Prime Minister and the minister are already preparing the way for a very harsh budget. For me to speculate on what would be included in that budget would be to upset Canadians 10 days prior to the minister actually delivering the bad news himself. I will leave that to the Minister of Finance to inflict on Canadians on February 20.


Gilles Loiselle: Mr. Speaker, the motion before the House today asks us to call upon the government to abandon its goods and services tax. I believe our answer is clear and straightforward. The answer is no. Let me explain. To abandon this essential reform of our tax system means abandoning senior citizens; it means abandoning individuals and families who are less well-off; it means abandoning our industries and businesses, both large and small; and it also means abandoning our exporters who are faced with increasingly intense competition on international markets. Mr. Speaker, to abandon this reform is to abdicate our responsibility as a national government.
We do not intend to follow the far from illustrious example of previous governments that lacked the political will and the courage to overcome obstacles to a comprehensive reform of our tax system. This reform- our reform-is indeed a challenge. However, as we demonstrated in our policies on investment, competition, rules, copyright, international trade and many other vital economic issues, this government is prepared to face the major challenges of our time.
It is never easy to initiate a major reform, especially tax reform. Our friends in the Official Opposition who drafted the motion before the House today proved this point, year after year, decade after decade, when they were in power. Despite recommendations made by several royal commissions and parliamentary committees during the past 50 years, they always tried to avoid the complex issues and problems involved in a comprehensive reform of the tax system.
For half a centuiy, our businesses and exporters have been severely handicapped when facing foreign competition. For half a centuiy, Canadians have been paying billions of dollars in federal taxes they were not aware of. Doesn't it strike you as something of a paradox, Mr. Speaker, now that they are sitting comfortably on the opposition benches, that same party is asking the government to abandon its plans for a so-called ill-conceived tax reform, a tax reform that the Liberals, of course, carefully avoided introducing when they were on this side of the House?

Where was the Liberal party over the last 50 years? More important, where is the Liberal party today on the issue of tax reform? Trying to put together the bits and pieces of Liberal thought on this issue is a little like trying to shovel smoke on a windy day. On this vital issue for the future of Canada the Official Opposition has shown itself to be rather bankrupt. But, when you think about it, bankruptcy is a condition not unknown to that party in its management of our affairs.
One of the few clues to Liberal thinking on this issue can be found in their minority report of November, 1989. They outlined a list of principles of tax reform which included fairness, simplicity, integrated reform, visibility and, yes, revenue neutrality. It sounds pretty good. In fact, these principles have a vaguely familiar ring, not
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only because of today's motion but because they are exactly what guided the development of our proposed goods and services tax.
One sentence in that report particularly struck me, and I quote: "The Liberal Party has always stood for and defended a fair and progressive tax system." I do not question the sincerity of my Liberal colleagues. I do, however, question their accuracy. Is this not the same party which refused to undertake comprehensive reform of our destructive sales tax system for the past 50 years? Is this not the same party that ignored the Rowell-Sirois report, the Carter commission and the Goodman committee report? Progressive, Mr. Speaker? I suppose this is what is meant by the Liberal interpretation of history.

As for our friends, the New Democrats, we have already given a detailed response to their proposals. Suffice it to say, Mr. Speaker, that the NDP has shown a disturbing lack of intellectual honesty and has inexcusably failed to grasp the realities of our international economy.
For several days now, this party has treated us to a regular roller coaster of obstruction tactics. Day after day, it delayed the business of the House and prevented members of the other two parties from proceeding with the debate on the GST bill. Day after day, NDP spokespersons indicated they were not in the least interested in a real debate on the GST.
When I see this kind of anti-democratic behaviour, I am reminded of something that Rabelais said: Bring down the curtain, the play is over.
I must say that their new leader's performance was rather pitiful. She seemed incapable of dealing with the substance and was constantly spouting generalities, I would even say platitudes, that had no connection with the proposed legislation.
When the Minister of Finance asked her to back up her gratuitous statements on senior citizens and the needy, she was unable to quote any figures, any valid statistics.
Mr. Speaker, you can rebuild a bottomless boat a thousand times, but as long as it doesn't have a bottom, it won't float.
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The motion of the Official Opposition requests a comprehensive reform of our tax system. That is exactly what we are proposing in the GST bill. The motion asks for a visible tax. The GST will be visible. It will be applied at the retail level, to a very broad range of items and at a uniform rate. Consumers will know when and how much tax they will be paying. This is a vast improvement over the present system. Today, we have no way of knowing how much federal sales tax we pay. Why? There are four different rates and numerous exemptions, and every tax we pay is hidden somewhere in the production and distribution process.
The motion asks for a reform that will take into consideration all forms of taxation. The GST is part of a comprehensive reform of our tax system which includes changes in personal and corporate income tax, the introduction of refundable credits, the introduction of a tax on large corporations, and so forth.
The motion also asks for a tax reform that will not increase the overall tax burden.
We are proposing precisely a reform which, thanks to refundable credits, will give three quarters of one-parent families and households headed by seniors more after-tax income than they have under the present system. With the credit on inputs, our businesses and exporters will also find their tax burden lighter.
The Official Opposition's motion also asks for an integrated tax system. I presume that means a national system involving both levels of government. Mr. Speaker, from the summer of 1987 to last spring, we had detailed discussions with the provinces on the feasibility of an integrated national sales tax. Although we did not reach agreement, the discussions helped the government develop and design the GST. Furthermore, we are continuing our consultations with the provinces and the door is always open to creating a system with their participation.
Mr. Speaker, today we are at a crossroads in our political and economic history. What road will we choose? The one which leads to the future or the one which leads to the past? The road of reform, freedom and initiative or the road of the status quo, constraints and the faint-hearted?

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As for us, Mr. Speaker, we have chosen the future. We are proposing reform and progress. We accept the challenges of political and economic integration with the world. That is the way to a stronger, more dynamic and prosperous modern Canada.
Unfortunately, in spite of what their motion says, our friends in the Opposition are proposing the opposite. With their gaze fixed on the rear-view mirror, they seem to want to take the beaten paths. Faced with a rapidly changing world, the Opposition is seeking the security of known ground. Faced with the challenges of a more open and integrated world, they want Canada to turn its back on the changes, reforms and initiatives of our trading partners.
Mr. Speaker, no one in this Flouse will pretend that reforming our tax system will be simple or easy. That is never the case with big projects. However, few claim that this reform is not necessary for the country's financial and economic health. Because this reform is so important and complex, we listened very carefully to our fellow citizens from all regions and all sectors of activity. Their numerous suggestions did make it a lot easier to improve the original draft. They told us the rate was too high, so we reduced it while at the same time maintaining the essential balance between the various measures which guarantee the equity and protection offered to low-income Canadians.
We have also allayed some of the concerns voiced by businessmen who will have to meet the GST requirements. For example, we will give small businesses a one-time transition credit of up to $1,000, and we have exempted from the current sales tax points of sale electronic equipment and related stock management systems. This is on top of the 100 per cent deduction for the depreciation of this kind of equipment which we made public as early as last August. Then we made a number of technical changes to simplify the implementation of the tax, made the situation of competitive companies more equitable, and improved the tax application in certain sectors.
Mr. Speaker, the system we are proposing under the GST is in keeping with all the reform criteria advocated by the Official Opposition. It will be visible, fair, readily understandable and much simpler than the current system.
Give up our project, Mr. Speaker? Quite the contrary, it is time to act more than ever before. More than ever before, now is the time to build a strong and dynamic
country. More than ever before, now is the time to control our own destiny.


Mr. Duhamel:: Mr. Speaker, I have a question for my colleague. I should like to know whether you have had any opportunity to consider other approaches or other possibilities with respect to collecting the necessary taxes, and if so which ones? For example-

Did you look at what the blocking of the various loopholes that now exist would have yielded? Did you look at the possibility of more auditing and how much more funds that would have provided for government? Did you look at the possibility of examining the underground economy to see whether or not there would be some additional financing for government? Did you look at the possibility of increasing corporate taxes? Did you look at a possible new mix of fiscal and monetary policies?

What I really want to know, and I know that from the outset you as a government have emphasized the GST and a number of variations. But quite apart from these other possibilities I am interested to know what you have done to examine the suggestions I just mentioned. Was that really done? If so I should like to have concrete proof, not just comments to that effect.


Gilles Loiselle: Mr. Speaker, I thank the hon. member for giving me an opportunity to clarify a number of points. We did just that and I believe the results are proof positive. I would not say that all the options he suggested have been thoroughly explored. I would suggest these options relate rather to day-to-day management. He said something about loopholes.

You spoke about the loopholes. My colleague, the Minister of Finance, has provided the House with massive lists of loopholes which we have closed, loopholes which were introduced in our fiscal legislation by your party when you were in power.


Ron J. Duhamel: How many still exist? That is what I am asking.


Gilles Loiselle: We are closing them all the time. There are fewer and fewer.
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You talk about more auditing. Of course this is a question of better management. We have to keep trying to make sure that the taxes which are owed to the government do come in.
We have looked at all these measures to the extent that when we came into power, for example, our budget was far from being balanced as you know very well. We needed to borrow $16 billion just to make up for the expenditures, apart from the interest on the debt and so on.
Last year we were able to take $9 billion and use that to pay the interest. We have improved the situation by $25 billion. That is very good management. We have lowered the deficit.
Of course we must do more. We increased corporation taxes in the last budget by $2 billion. The package that was introduced by my colleague, the President of the Treasury Board, is linked with the GST. There is a limit to the pressure you can put on that.
When I listen to these stories about thousands and thousands of corporations making a profit and not paying any taxes, it always throws me off because it is not true. It was true many years ago, but we have worked in a very careful way to close these things and to make sure they pay their contribution.
Some companies have a profit which is paid as a dividend that is taxed. It cannot be taxed twice. Others are very small companies, many of them farms, which have had an average profit of $25,000 over the last few years. These are areas with respect to which we have been asked to be veiy generous in order to make sure that employment is maintained. You cannot have it both ways.
We are looking at all these avenues. I do not think that they can make up a major pillar of our taxation system.


Jean-Robert Gauthier: A brief comment, Mr. Speaker. I think the Minister of State for Finance may have gone further than his text and perhaps even his thoughts. He said that Bill C-62 is "comprehensif dans son concept". I looked up the definition of the word because I had the impression the minister's definition is not the same as mine. "Comprehensif" means that which is easily understood and defined.
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Mr. Speaker, the bill is one of the most complex ever tabled in the House.
It is not easy to understand, and when I hear him talk about a "readily understandable" reform, I wonder where on earth he got that idea from. Either he did not read the bill, and I am pretty sure the Minister of State for Finance has read it, unlike the Minister for International Trade who does not read his documentation. But where did he get the idea that this document is simple when we know that it is one of the most complicated, that, as the Canadian people keep telling them, it will be hard to interpret and, in many cases, very complex for small business, and that the manufacturing and others industries will have a hard time understanding and implementing it. I have a very straightforward question for the Minister, since it involves a remark I made on the meaning of the French word "comprehensif".
Will the Minister admit that this goods and services tax bill is the biggest tax break ever given to Canadian corporations? I am using these simple terms so that he will be able to answer my question. Will he admit that it is the largest tax break ever, what we would call a Christmas present, to corporations? The 13.5 per cent tax is being removed but there is no guarantee that they will be passing on these savings to the Canadian people under the GST.


Gilles Loiselle: The hon. member is quoting from the Petit Robert, I believe.


Some hon. members:: The Grand Robert.


Gilles Loiselle: I must say that being in Ottawa, where we switch back and forth from one language to another, as he very well knows, we sometimes make mistakes. When I said "comprehensif" in French, I was probably using it with the English meaning of "comprehensive" or "wide-ranging". Besides that, the hon. member is right in a way. Canadians pay tax, but if you put the tax laws in front of them, not one of them could truly say they would be able to get through it, and that certainly applies to me. But if you like, while we are here-


Some hon. members:: Oh, oh!


Gilles Loiselle: I can read it, but in fact I must say that I have good accountants to explain it to me. Those documents are indeed very complicated but we can summarize the main idea. When we talk about exemptions, for example, on basic food or medicine, not everyone necessarily has to deal with all that. They are

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usually concerned with only one area and everyone will get detailed explanations.
So I think our bill is "comprehensive" in that it is all-inclusive. It is also "understandable" because 48 countries have such a tax. I do not think Canadians are dumber, as some would have us believe, than the people in those 48 countries that have a tax which works very well and is based on exactly the same principles as ours, often with several rates.


Mr. Fontana:: Mr. Speaker, the minister talks about the proof being in the pudding. I suggest that the proof is that this government is incapable of managing the economy.
He talks about the future. Let me tell you, Mr. Speaker, that the future is a nightmare for lower and middle income groups, as well as small business, as reflected in the GST.
I suggest that this government wishes to punish the Canadian people for its mistakes and mismanagement of the economy. I want to ask the minister this: How is it that this government has raised taxes 31 times in the last five years, thus increasing taxes on middle income people by over 60 per cent and at the same time doubling the debt from $160 billion to over $360 billion in 1990?
Perhaps, while he is up, he may want to tell us what pre-budget consultation his government has undertaken in preparation of the budget to be tabled on February 20.


Gilles Loiselle: Mr. Speaker, the hon. member has covered a lot of ground. I do not know in the time remaining if I can cover everything.
He said that we are punishing the people. The economy has increased and of course people are paying more taxes, but their incomes have also increased to the extent that they have more money now than they had before.


Joseph Frank (Joe) Fontana: In their pockets? Are you kidding?


Gilles Loiselle: The hon. gentleman does not realize that the number of unemployed people who were there when we came into power was as a result of the awful state of
the economy. We had to raise taxes to make up for the deficit we found when we came in.
In the last year there was a 17 per cent increase in spending. We have lowered that over a period of five years to 3.6 per cent, 5 per cent, and so on each year. We are very good managers and we are very proud of our performance. It is difficult to manage, but we have improved the situation considerably.


Mr. Thompson:: Mr. Speaker, I just want to make a couple of comments on what the hon. minister had to say. What I want to emphasize the most is the fact that there has not been any real debate on this particular issue. The things we are hearing from the Liberal Party and the NDP are the same things we have heard all along. They say that there is no real debate. They are using the same kinds of tactics that they have used on any initiative that this government has attempted to take. What we do here is maintain the status quo, and we know the status quo has been broken. It has been broken since 1924 and we know it.
Every Canadian who has a head on his shoulders knows that this present tax system is broken. What do they want to do, hold on to it?
I suggest that Canadians put that question to each and every Liberal candidate who is seeking the leadership of that party. In fact some are on record as saying that they would maintain the status quo. That is exactly the same thing they have done since Confederation-maintain the status quo. But they do not attempt to do anything different, anything that might take a little imagination or anything that is the least bit controversial. They will always take the easy road. They have done it for years. They will take the easy road and the low road. They have not changed.


Gilles Loiselle: Mr. Speaker, I would certainly agree that it is not an easy road, but it is the only good road for the economy and the people of this country. We are taking it.


David Barrett: Mr. Speaker, I want to thank you for allowing me to enter into this debate under the rules of this House. I have been very interested in sitting here listening closely to what people are saying and hoping to become informed.
I thought the member from the Liberal Party who asked the questions about the 30 increases in tax and the increase in the deficit had some very valid questions. I
February 8, 1990

was disappointed that the minister did not respond to those valid questions. In effect, what the minister said to my friend in the Liberal Party is that the reason we have more debt is that we have more money. That is right.
It was Orwellian. He said that we have more money in the economy, people have more money in their pockets, ergo, we have more debt. My parents raised me during the depression years. When we had more money we paid down the debt.
The Conservatives have invented a whole new strategy in the economy. When you have more money, go deeper into debt.


Mr. Larrivee:: He didn't say that.


David Barrett: He did. You read what he said.
The logical conclusion of his statement is that if we have more money then we have more debt. My God, let's go poor so we can pay off the debt: that is the stupidity of the attitude of this government in terms of its responsibility.


Gilles Loiselle: Mr. Speaker, I would like to tell the hon. member that is absolutely not what I said. I did not have time to get into the subject of the debt. I could answer him that the debt rose because we carried forward the Liberals' deficit, although we reduced it. That is obviously not what I said. I explained that Canadians paid more tax because their incomes were higher and they had more money in their pockets.


David Barrett: Mr. Speaker, I don't mind the interruption as long as it does not come off my time. Not only do they squeeze up the debt, they take up other people's time. I want that time recorded back to myself.
What I got out of it is inescapable Orwellian thinking. We have more money, therefore, we have more debt and that is all there is to it.
I like to hear all this discussion from an academic sense from the minister. It is a lecture that says to the Canadian people: "We have to be responsible. We have to pay these bills down. The rich cannot afford to do this, otherwise they would not be rich any more. It has to be
Supply
the poor and the middle income earners who will have to do it".
After all, I understand the Conservative philosophy. If we tax the rich they will not be rich any more. Would that not be unfair? They would have to pay taxes and maybe not enjoy the luxuries as much. Therefore the poor and those in the middle must pay the tax.
I know now the purpose of this coin established by this government. It is known as the loonie, which is absolutely appropriate. Before somebody in the middle income tax bracket gets to spend this loonie it is already reduced to 70 cents because of the 30 per cent, on average, tax that has been paid. Some poor bank clerk, some security attendant or some other people who service this place get a loonie, and it is only worth 70 cents.
Then they live in a province where they have on average a sales tax of 10 per cent, but not Alberta. I will come to Alberta in a minute. We are not going to hear from the Alberta MPs. I have to speak not only for British Columbia but for Alberta because the Alberta members have been struck dumb on this issue. It is incredible the new handicap they have. They are speechless politicians, a genre unique to the Tories of Alberta. When you raise the question of GST, they are gone, dead, disappeared, with the exception of Kindy who they want to trade off anyway. He is the only one from Alberta who says he is against the tax.
Returning to the loonie, Mr. Speaker, it is down now to 70 cents. With 10 per cent on a provincial tax it is down to 60 cents. There is 4.5 per cent off for inflation and another nickel on stupid high interest rates and we have a 50-cent loonie.
That is what average people have in their pockets after they have already paid taxes. The surtaxes on the taxes reduce this loonie to 50 cents. We have a government of 50-cent loonies. They are four-bit loonies. It is a whole new expression. The Tories are four-bit loonies, and they are trying to tell us that they are being fair with the taxes. Goodbye loonie, spend it now before it goes down to 40 cents. The way these guys are going they will have to use these in nickel slot machines and hope for the best.
Let us talk about debate. The Conservatives say: "We have been fair. We have listened to people. We are the Conservatives. We believe in democracy". Yesterday was the twelfth time we have had closure in the life of this Parliament. The door is closing more frequently in this

February 8, 1990
Supply
debate than it is in the washrooms of this Chamber. They close the door with everything they do. On debate, it is closure, closure, closure.
Now we are going to go to committee, and do you know what is going to happen, Mr. Speaker? I know what is going to happen. I hate to share this with the House. Thank goodness there are only a few people here.
They are going to have the committee meetings here in Ottawa. They are not going to travel across Canada. They are not going to open the doors to ordinary people. They are going to use my good friend, that fellow from Mississauga, as the chairperson of the committee. He is going to say: "No, we are not travelling. No, we are going to close it down". It is a whole new concept. Not only are they going to have closure in this House, they are going to use closure on the Canadian people by keeping the committee here in Ottawa.
Some 80 per cent of the population is against this tax. Why would a government pursue a policy when 80 per cent of the voters are against it? We have to ask who their masters are. If the masters are the vex populi, the ordinary Canadians, men and women who say they want a government that is reasonable, responsible and fair, 80 per cent of whom say they are against the tax, then reasonable people will expect that a responsible government would say: "80 per cent of the people do not want to pay the tax. We had better take a second look".
Who do they represent? It is not the 80 per cent. They represent the corporate elite in this country who have been dictating the fiscal agenda in this Chamber since the Tories got elected.
It is a big problem for the Liberals. Some of them are actually Liberal. They are going to have a fight about who dictates their agenda, but we know that that is a separate problem. As a social worker I am available, for a fee, to assist them.


Ron J. Duhamel: You are doing well so far, so just back off.


Mr. Karygiannis:: No hidden microphones here.


David Barrett: I do not mean to rile up the Liberals. The reality is-and we heard it today-that the Liberals have declared publicly: "We are against this tax. We are mad at government. Please don't pass it, but if it does pass I guess we are going to have to keep it if we are in government".
You know, Mr. Speaker, I heard it with my own ears. There it is, Mr. Speaker, right out in the open: no bugs.
There was closure in the House. There will be closure in the committee. That is exactly what the Liberals want.


Some hon. members:: Oh, oh!


David Barrett: The Liberals are chuckling, giggling, and laughing behind the curtains. They look at the polls which show that they are away up and may win the election. These guys across the way are committing suicide, and the Liberals are going to embrace the hemlock and live off it because it is their fault.
Do you know who is getting hosed in this, Mr. Speaker? The same people who have the 50-cent loonie from this outfit. Ordinary Canadians are being taken for a ride by the same two old line parties which represent the corporate interest, the bottom line of this country, no matter what is going on.
The member said that I was a Minister of Finance. He is correct. We squeezed $800 million out of the oil companies that the federal Liberals were allowing to go into U.S. pockets. That was a change in taxation. You should have heard the former ministers, except for their leader, who had the courage to take it.


Mr. Milliken:: And the people threw you out.


The Acting Speaker (Mr. Paproski):: I would like to hear the hon. member. The hon. member for Esquimau-Juan de Fuca has the floor.


David Barrett: Mr. Speaker, I am glad you intervened. I was getting so interested I wanted to hear myself.
Perhaps we could agree, Mr. Speaker, that it is one o'clock and I will complete my remarks later this afternoon.


The Acting Speaker (Mr. Paproski):: The hon. member will have eight minutes left in his speech, plus ten minutes for questions and comments when we return after lunch.
February 8, 1990

It being one o'clock, I do now leave the chair until two o'clock this day.
At 12.57 p.ra., the House took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.

Mr. Bill Vankoughnet (Hastings-Frontenac-Lennox and Addington):: Mr. Speaker, as Canadians we are fortunate to live in such a wonderful country. Created out of a wilderness with the blood, sweat and tears of people from every part of the globe, we are the envy of the world. But there is a lesson to be learned from historic events occurring in eastern Europe where every day walls are being tom down.
The world is full of examples of what can happen to a nation when its people lose faith. In Ontario, municipalities have been expressing their concern for the economic impact of the province's Bill 8, an act to provide for French language services.
Some of these municipalities are in my federal constituency in eastern Ontario, and they have expressed disappointment and surprise at the recent irresponsible statements made by the premier of Ontario on this sensitive and deeply rooted issue.
Let us remember that, only through goodwill and tolerance, can we hope to have a stronger and unified Canada.


LAND CLAIMS
Maurice Brydon Foster: Mr. Speaker, on February 2, an agreement in principle was reached between the Ontario government and five Indian First Nations on Manitoulin Island, concerning their historic land claim involving some 36,400 hectares of land and $8.9 million in land and money.
Once the agreement is ratified by the parties involved, it will settle at the provincial level a land claim that has been going on for many years which has caused uncertainty not only for the bands but, as well, the municipalities of the Manitoulin district.
So far the federal government has refused to negotiate with the Manitoulin First Nations their part of the land claim; that is, to pay compensation for the loss of the use of these lands for the past 128 years since the treaty was signed in 1862.
Now that Ontario has reached an agreement on this claim, I call on the federal government to sit down with the Manitoulin First Nations and negotiate a fair and equitable settlement for this land claim. It is essential not only for the First Nations of Manitoulin, but for the entire district.


ATLANTIC CANADA
Mr. Chris Axworthy (Saskatoon-Clark's Crossing):: Mr. Speaker, on December 13, the Prime Minister made a commitment to Atlantic Canadians that this government would be as generous to them as it had been to Prairie farmers last year.
The Prime Minister reaffirmed this commitment on January 22. Where is this help? Tens of thousands of Atlantic Canadians are facing no future if they choose to stay in the region. They see their jobs disappearing, their communities and way of life threatened.
Ken Stein, who heads the government's task force charged to provide cabinet with options for the Atlantic fishery, told the fisheries committee that the best approach is more research and development of underutilized species and advised the committee that the government was not interested in subsidizing the industry.
Canso, the first community to benefit from this thinking will lose its trawler fleet and see the replacement of 800 jobs with 150 jobs shared between 300 people. Some solution!
This is the federal government's idea of help when at least two-thirds of those involved in the fishery can look forward to losing their jobs, having to leave their communities and those remaining can look forward to temporary work at best?
What are these skilled Atlantic Canadians to do between now and when the stocks are replenished? When is the Prime Minister's commitment to provide Atlantic Canada with $1 billion worth of aid-the amount he said he provided the prairie farmers-going

February 8, 1990
to be fulfilled? When are Atlantic Canadians going to see a full-blown strategy to deal with the crisis they face?


OFFICIAL LANGUAGES
Mr. Bill Casey (Cumberland -Colchester):: Mr. Speaker, since my arrival here some months ago I have been puzzled by the absence of discussion about language. My view is that after many years of official bilingualism there is still a great misunderstanding between the Frenchspeaking and English-speaking Canadians.
To English Canada the language issue is one more of economics, language and convenience. To French Canada the issue is one of culture and the very way of life.
As a unilingual Canadian I have experienced the isolation of being in a group of French-speaking Canadians and not understanding what is being said. Perhaps this is the same isolation that French-Canadians feel in a continent which is mostly English.
French members on the other hand express surprise that language is even an issue at all in my English riding. But in an area of high unemployment and limited opportunities many people otherwise qualified for government jobs are disqualified because they do not speak a second language.
Now municipal, provincial and federal governments are passing language laws but laws will never resolve these questions. Only understanding will. Understanding should start right here. I urge English and French members to begin a dialogue to begin to understand our differences and then maybe we can develop some successful solutions.


CATALOGUE MAILINGS
Mr. Len Hopkins (Renfrew-Nipissing-Pembroke):: Mr. Speaker, Canadian Forces Bases Borden, Kingston, and Petawawa were recently the target of a catalogue mailing from a lingerie company. The recipients of this mailing are upset and deeply offended.
The catalogue in question arrived unwrapped and contained pictures that are borderline pornography. In many cases children in the families were the first to see the catalogue. This has upset many parents who feel that their fundamental right to choose what is acceptable or not has been challenged.
More important, the fact that they were the only people in the ridings to receive this material is unsettling. It casts aspersions upon the character of these people. It is as if the company that manufactures these goods feel that Canadian Forces personnel are more likely to purchase them than anyone else.
Canada Post adheres to the Criminal Code when deciding what should be wrapped before it is mailed. To that end, I am looking into proposing an amendment to the Criminal Code that deals with the problem of offensive and targeted mailings.
These peoples' rights have been infringed upon and such incidences should be rendered preventable.


INTERNATIONAL HOCKEY PEEWEE TOURNAMENT
Mr. Marcel R. Tremblay (Quebec-Est):: Mr. Speaker, today is the official opening in Quebec City of the 31st International Peewee Hockey Tournament, Mr. Alex Legare presiding.
I wish to take this opportunity to praise the dedication and understanding of a man who, for more than 10 year, has done everything to help these young hockey players.
I also wish to mention all those who worked so hard to organize this tournament and the many sponsors who have made this event a resounding success.
A word of praise also to the parents who accompanied their children on frequent trips, which in many cases, Mr. Speaker, had to be organized with very limited resources.
And now I wish to congratulate our young hockey players, on behalf of the people in Quebec-Est, for their energy and courage in preparing for this competition, and I wish them the very best of luck.
February 8, 1990


MINORITY RIGHTS
Ron J. Duhamel: Mr. Speaker, I rise today to express my deep concern with the spread of serious symptoms of intolerance in our country.
Recently we have seen many examples of this ugliness. A pin showing a white person surrounded by stereotyped and menacing images of minority groups, a vulgar and racist handbill declaring open season on native people, a racist anti-Sikh calendar, many failures to respect minority language rights here in Canada.
Canada is built on tolerance. When this fundamental characteristic is eroded we lose the essence of what it is to be Canadian. The national government must really play a leadership role, a substantive role. It must stand up for minority rights everywhere and it must stop the continuing polarization of the have and the have-nots in this country.


DONALD MARSHALL INQUIRY
Mr. Robert E. Skelly (Comox-Alberni):: Mr. Speaker, Nova Scotia's Attorney General may have apologized to Donald Marshall but Nova Scotia's response to the Marshall Commission recommendations are deceitful and defensive.
They exonerate the justice system again by blaming Marshall's socioeconomic status rather than the justice system for his poor treatment. In fact, Nova Scotia boasts that its system treats Indians better than western provinces, which put more Indians in jail. Nova Scotia has rejected virtually every substantive recommendation of the Marshall Report but has couched its rejection in the language of acceptance.
The refusal of Nova Scotia to accept the Marshall Inquiry's recommendations, and to be honest about the shortcomings of its justice system, amount to another whitewash. It means we will be seeing more cases like Donald Marshall's.
I call on the Minister of Justice to take immediate and effective action at every level of the justice system throughout Canada so that our aboriginal people can receive fair treatment under the law.


OFFICIAL LANGUAGES
Hon. Bob Layton (Lachine-Lac-Saint-Louis):: Mr. Speaker, last week the Secretary of State and the Minister of Education for Quebec announced a series of innovative measures to be undertaken by the provincial government. These will constitute part of the federal-provincial agreement on official languages in education.
Given the extent of the English language school system in Quebec, the province receives a sizeable portion of the financial assistance allocated by the federal government to the provinces.
Under the agreement, the Government of Canada will contribute $328 million over the next four years toward minority language education and second-language teaching in Quebec.
This financial assistance will permit the Government of Quebec to direct $27 million toward new capital projects in various English-language educational institutions. Significant sums will also be directed toward the teaching of French and English as second languages.
The two ministers have also announced innovative initiatives to encourage exchange and dialogue between young people from our two linguistic communities. As well, a number of joint projects will be established to give support to francophones outside Quebec in the area of education.
It goes without saying that these measures are both timely and desirable for the harmonious development of our Canadian linguistic duality.


JUSTICE
Mr. Alfonso Gagliano (Saint-Leonard):: Mr. Speaker, I rise today to inform the House of a grave miscarriage of justice.

February 8, 1990
During the evening of April 29, 1989 five young women were seriously wounded when the car in which they were driving was hit by a van driven at high speed in the wrong direction on a one-way street.
The van had been stolen, the driver, Gerard Arbic, had just been released on parole. He had no driver's licence. With two accomplices he was trying to escape a police chase after the burglary of a supermarket. Gerard Arbic was later sentenced to seven and a half years in jail.
Milva Di Francesco is one of my constituents. She is one of the young women injured in the collision. She is 19 years old. Right now she would have been starting commerce or business administration at McGill or at Concordia University. She had been accepted by both institutions. However, she has been unconscious since the night of the accident.
With good behaviour Gerard Arbic will probably be eligible for parole in two and a half years. Milva Di Francesco will probably be still in a coma.

Mr. Speaker, I have here a petition that I will give personally to the Minister of Justice.
This petition contains more than 9,000 signatures of Canadian citizens who call upon the federal government to amend the legislation so as to impose more severe sentences for criminal offences causing serious bodily harm or leading to death.
Mr. Speaker, the government should also do more to help the victims of crime and their families.


THE ECONOMY
Douglas Fee: Mr. Speaker, I have received an overwhelming response to a survey on the goods and services tax.
Several hundred people did more than reply. They wrote letters, many of them three and four pages of ideas and constructive criticism. Of the total replies received, 29 per cent were categorically opposed, 8 per cent offered their unqualified support and 63 per cent offered a qualified support, mainly a call on the government to practise restraint and reduce spending. The detailed results of my survey have been forwarded to the Minister of Finance. I have assured him that the people
of Red Deer understand the need to eliminate the deficit and control the debt. They will support-indeed, they demand a tough budget and further restraint in government spending.


CHANGING WORLD EVENTS
Mr. Bill Blaikie (Winnipeg TVanscona):: Mr. Speaker, yesterday's decision to eliminate the monopoly power of the Communist Party in the USSR must surely now convince even the most stubborn that a security system based on the notion of "better dead than Red", is now truly archaic.
A nuclear strategy designed to incinerate the people of eastern Europe and the Soviet Union and ourselves in the process, was always heinous and unacceptable. Its continued existence now is nothing less than radical evil.
Let us finally bury the big scare, and while building a new common security system in Europe, turn our political and moral energies to many other countries which are equally in need of glasnost, like Burma, which has been called Asia's Romania; or South Korea where we hear too much about economic miracles and too little about continuing repression; or Taiwan where a Canadian like Yih-Sheh Leo was recently arrested and detained for political reasons; or China proper, which continues to oppress its own citizens, and Tibet.
The list goes on, but it is not endless. It is finite and susceptible to human purpose. May all the anti-Communist energies that have been used for good or ill over the years be turned against oppression of all kinds, economic and political, in whatever guise.


INVESTMENT CANADA
Mr. John Harvard (Winnipeg St. James):: Well, here we go again. Another plant will close in Canada. This time a battery plant will close in my riding after another sale to an American company and 175 jobs will be lost. Investment Canada has approved the sale, but why? This is the government agency that has a mandate to protect Canadian workers and Canadian investment.
If there is a net benefit to Canada in this sale, where is it? It would be difficult to convince the workers that there is a net benefit to them. It would be difficult to convince Winnipegers that there is a net benefit to them.
February 8, 1990

If there is a net benefit to Canada, it has not been spelled out by Investment Canada or by this government.
Winnipegers and Canadians have a right to know. I challenge the government to make the facts public right now. In this sale, western Canada loses all of its battery production. Under this deal, Americans have gobbled up another Canadian competitor. Where will it all end? Canadians want answers and they want them now.


REVENUE CANADA
Gregory Francis Thompson: Mr. Speaker, the Minister of National Revenue's office recently held meetings with local customs officials to discuss the matter of extending services at Centreville, in my riding of Carleton-Charlotte. At that meeting there was unanimous resolve on the part of local departmental officials and union representatives to find a solution that would extend commercial service beyond the current deadline of 5 p.m. To date, officials in Ottawa have resisted such a change, citing that such a move would be contrary to the department's need to reduce expenditures.
The facts do not support this position. The number of people on duty after 5 p.m., at Centreville does not change. Consequently, there will be no need to increase staffing budgets. Furthermore, the volume of traffic is such that the additional time needed to process commercial entries would not seriously affect the department's ability to serve non-commercial traffic.
In short, the only real difference resulting from this change in status is the ability of the department to better serve the needs of the local community.
I call upon the Minister of Revenue to direct his department to-


Mr. Speaker:: Unfortunately, the hon. member's time has expired.


Mr. Arnold Malone (Crowfoot):: Mr. Speaker, the events of recent days in the Soviet Union have been extraordinary. Mikhail Gorbachev has shown courageous leadership in moving his country toward democracy and
Oral Questions
economic renewal. We should commend his vision and applaud his skills.
By taking these steps, Mr. Gorbachev has also given a challenge to all other countries. The challenge is to dare to undertake those procedures which will build a mutual environment of confidence. All countries should work to respond to this opportune moment in history.
Next week, in Ottawa, Canada will have the opportunity to play a leading role in advancing the confidencebuilding measures. The Open Skies Conference is a unique occasion for Canada to make a substantive contribution to verification procedures, tension reduction and confidence-building. This statement is shared by all members of the Standing Committee on National Defence and Veterans Affairs.



ORAL QUESTION PERIOD

[Stage Direction]


Hon. Herb Gray (Leader of the Opposition):: Mr. Speaker, my question is for the Minister of Finance. He knows that the legislation imposing a 7 per cent tax on all goods and services has not yet passed this House, has not passed the Senate, and has not received Royal Assent and yet he will recall that last fall he authorized the spending of over $1 million of taxpayers' funds to put ads in all the newspapers to say that the tax was a fact and asking Canadians to save those ads.
Well, apparently, Mr. Speaker, in spite of even your condemnation of these ads, some firms apparently did save this notice and are already charging the new tax to Canadians. Will the Minister of Finance confirm that Metropole Emergency Response Centre of Winnipeg is already billing its clients for this new tax, and will the Minister of Finance tax immediate steps to find out how widespread this practice is and take immediate steps to have it stopped immediately?


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, my hon. colleague is quite well aware that it would be quite inappropriate for any company to charge GST today. There is a federal sales tax in place. That is the only federal sales tax that should be levied on any good today, and until that is eliminated, which will be the case with the GST, then it is inappropriate. If my

February 8, 1990
Oral Questions
colleague would like to provide me with the details that he has just mentioned to me right now, I would be happy to look into it.


Herbert Eser (Herb) Gray: Mr. Speaker, I would be delighted to send the Minister of Finance the facts on this situation, but what we have here is evidence of a blatant lack of respect for democracy and the House of Commons of this country. As I said before, ads appeared in the papers, telling Canadians that the House had spoken and that in any case, we would have a new tax as of January 1,1991. A $14 million advertising campaign was launched to persuade Canadians to accept the new tax. Debate in this House on one of the most important tax proposals in our history was blocked with a motion of closure. The fact that today, people are being charged a tax that does not yet exist, is, I would suggest to the Minister, a logical consequence of this systematic erosion of the democratic process. Why did the Minister let this kind of situation develop?


Michael Holcombe Wilson: Mr. Speaker, I am not quite sure what the focus of that last question of the hon. member was. The point I should make to my friend is that the advertisement of which he is critical was an advertisement in late August which advertised a 9 per cent tax. Clearly the person who is charging 7 per cent, according to the allegations that he has just made, is dealing with another piece of information besides that particular ad, so the two things are not linked.
Now, he has made the point that we have ended debate on the second reading of the GST legislation. I think he understands the reasons we had to do that. We had offered the House the other day four hours of debating time and the opposition parties, particularly the New Democratic Party, wasted three of those hours. This place is for debate. I think it is important that we understand-


Some hon. members:: Order.


Mr. Speaker:: The hon. member.


Herbert Eser (Herb) Gray: Mr. Speaker, the minister is attempting to defend the indefensible when he talks about the government imposing closure on debate on second reading of the GST legislation in this House. If he is so concerned about that and so interested in debate, will he give an undertaking on behalf of the government that in spite of what the chairman of the finance committee says about getting the legislation through his committee in only four weeks, he will insist that the Conservative majority in that committee give Canadians all the time they need to make their point about how bad this tax really is?


Michael Holcombe Wilson: Mr. Speaker, my colleague, the House Leader and the Whip of the Opposition, has said-I am using his lines on this-that what the New Democratic Party was doing was silly; it was wasting Parliament's time. This is the reason that we moved the way we did yesterday.
As far as debate is concerned, we have been dealing with this particular legislation going back to a White Paper in June of 1987. We have had extensive consultations, discussions with organizations, social groups and labour groups that were interested in it. We have discussed the matter with the provinces. We had another paper in the April budget, the technical paper in August, the draft legislation in October and the response to the finance committee. The finance committee worked all through the fall. We have had tremendous openness and consultation discussion on this.


Ms. Clancy:: Nonsense.


Michael Holcombe Wilson: It is now time that we get on with the job.


INTEREST RATES
Mr. Jim Peterson (Willowdale):: Mr. Speaker, my question is for the Minister of Finance. The bank rate today went up to 12.79 per cent, the highest in the five and a half year record of this government. Historically, the real interest rate in Canada, that is, the interest rate minus inflation, has been about 2.5 percentage points. With today's rate increase this real interest rate has gone up to about 7.5 per cent. When is the government going
February 8, 1990

to recognize that its high interest rate policy, which is driving us into recession, is wrong?


Michael Holcombe Wilson: Mr. Speaker, if I may quote my hon. friend when he was on this side of the House in 1981, "there is no quick and easy solution to dealing with the problems of inflation and getting interest rates down."
We acknowledge, we recognize the importance of low interest rates to the health of an economy. But, we also know that it is important to get those interest rates down on a permanent basis. That can only be done if we can get the problem of inflation under control. We are facing the problem of inflation. We are facing up to it in a way that the previous government, through the 1970s and early 1980s, did not face up to it. That is why we got into the problem with which the hon. member was presented when he made those comments in 1981. These matters take time. We are dealing with them and we are going to follow through on the plan that I presented in November of 1984 as well as in the April budget last year.


James Scott (Jim) Peterson: Mr. Speaker, the difference between myself and the minister since 1981 is that I think I have become wiser.


Some hon. members:: Oh, oh!


Mr. Speaker:: Wisdom is rare and should never be denigrated.


Some hon. members:: Oh, oh!


James Scott (Jim) Peterson: Certainly on the government benches, Mr. Speaker.
The historical difference between U.S. and Canadian interest rates has been about two percentage points. With our rate increase today, this spread is well up over 4.8 percentage points. This high interest rate policy, which artificially inflates the value of the Canadian dollar, is having very serious consequences for Canadian exporters and Canadian workers. Will the minister table in this House and make public all communications that he or his officials have had with their American counterparts since prior to the free trade agreement being signed up until now with regard to keeping our dollar high in order to help the Americans with their trade deficit at the expense of Canadian exporters and Canadian workers?
Oral Questions


Michael Holcombe Wilson: Mr. Speaker, the wisdom that my hon. friend displayed in the opening part of that question deteriorated badly as he got through to the final posing of the question.
The point that my hon. friend is making is that interest rates are causing some difficulties within the country. I understand that, but I also understand what the alternative is. If we do not deal with the inflation problem, we are going to have some very serious, longer lasting problems with high interest rates.
My hon. friend said he is wiser today than he was back in 1981. I would hope so, because in 1981 he was defending a policy which led into the most serious recession that we have had in many years. That is what we are trying to avoid.
He also said he wants to see all of the correspondence that is exchanged between this government and the United States government. Surely he understands that that is a ridiculous request to make.


Mr. Lome Nystrom (Yorkton-Melville):: I also have a question for the Minister of Finance, Mr. Speaker. This afternoon, the Bank of Canada sharply raised interest rates in this country and the discount rate is now at its highest level since the summer of 1984. My question is therefore addressed to the Finance Minister. When will he stop being John Crow's puppet? When will he tell John Crow, the Governor of the Bank of Canada, that enough is enough, that interest rates in this country are now too high for ordinary people?


Michael Holcombe Wilson: Mr. Speaker, at any time when one is dealing with very difficult and complex matters of government and public policy, one always has to look at alternatives. My friend says, "get interest rates down". Tell me, how is he going to get interest rates down? Is it just picking up the phone and speaking to the Governor of the Bank of Canada and saying, "Governor, get the interest rates down?". That does not work, because you have to get interest rates down through operations in the marketplace. That leads to an increase in bank loans, and that leads to higher inflation which automatically leads to high interest rates on a permanent basis and an ongoing deterioration of the competitive position of the Canadian

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economy. That costs jobs, and when we lose jobs, we lose those jobs on a permanent basis.
We understand the importance of getting interest rates down. We would like to do so, but we want to get them down on a permanent basis. The NDP approach to getting them down simply will not work.


Lorne Edmund Nystrom: Mr. Speaker, back in June the finance committee, supported by all three parties in this House, told the minister how to bring down interest rates in this country. It seems to me that Mr. Crow is only flying on his right wing. There are alternatives. This morning the Conference Board said that business confidence in this country is at a level almost as low as 1981, and that was before the increases in the bank rate this week and again last week.
Because of the economic and monetary crisis in this country, when is the minister going to present a budget to this House to deal with that crisis facing the Canadian people? When are we going to have a budget, and when are we going to have some concrete action?


Michael Holcombe Wilson: Mr. Speaker, we are going to have a budget on Tuesday, February 20. In that budget we are going to set out in a very clear way how we are dealing with the problems that we have today and how we are going to continue to deal with them into the future.
What we are doing now and what we are proposing to do is a continuation of the plan that we have had in place since November, 1984. The results of that plan have been that job creation in this country has been the best of any of the major industrialized countries, and economic growth in Canada has been second only to Japan and only by a small margin short of Japan. What we have been doing is working, and what we are going to do in the future will also work and will lead to a continuation of the excellent record that we have had so far.
Is the Minister of Finance not aware what a high interest rate policy is doing to farmers in this country, to small business people, to Atlantic Canada, to the regions, and to the north? If he is not aware of that, why does he not he take up his responsibility and resign as Minister of Finance, or call upon John Crow to resign as the Governor of the Bank of Canada?


Michael Holcombe Wilson: Mr. Speaker, in the preamble to the hon. member's question, he just delivered the ultimate insult. I cannot accept the recommendation that he has made.
What I will say to my hon. friend is that I am very much interested in the well-being of the small businessman, the farmer, the fisherman, the people in various parts of this country, and the people who live in all regions of this country.
I am convinced that the approach which we have been following over the last five years is absolutely the right approach, and it has been proven in the economic record that we have seen as a country over these past five years. We want to continue that record, but we know that if we ignore the inflation problem that we have seen developing over the last couple of years, we are going to get right back into the problem that Mr. MacEachen got us into back in 1981-82.


An hon. member:: That is where you are going.


Michael Holcombe Wilson: My hon. friend says that is where we are going. That is precisely where we are not going to go, and that is precisely why we are doing what we are doing so we can avoid that.


PRESENCE IN THE GALLERY
Mr. Speaker:: I wish to draw to the member's attention the presence in the gallery of His Excellency Gyula Horn, Minister of Foreign Affairs of the Republic of Hungary.


Some hon. members:: Hear, hear!


Lorne Edmund Nystrom: I do not think
any serious Canadian believes what the Minister of Finance is saying. He is sounding more and more like Allan MacEachen every day.


THE ENVIRONMENT
Mrs. Marlene Catterall (Ottawa West):: Mr. Speaker, my question is for the Deputy Prime Minister. Today's papers carried the shocking news that the government's

February 8, 1990

long-promised environmental action plan has been scuttled and all Canadians will get is a discussion paper.
Canadians were promised an action plan, concrete measures, timetables and money for the environment. Once again they have been betrayed.
Why has the Deputy Prime Minister and, for that matter, the Prime Minister allowed in-fighting in cabinet to destroy the most important action this government needs to take?


Hon. Don Mazankowski (Deputy Prime Minister, President of the Privy Council and Minister of Agriculture):: Mr. Speaker, that question has been answered in the House before. It was referred to by the Prime Minister a couple of days ago. Clearly, the action plan that the Minister of the Environment has referred to is in the process of being developed. There are broad-based consultations currently under way.
I can assure the hon. member that there will be a comprehensive environmental package that will be introduced pursuant to the commitment made in the Speech from the Throne.


Marlene Catterall: Mr. Speaker, my supplementary question is also for the Deputy Prime Minister. Canadians want concrete measures, right away. The government once again has not kept its word, its promises. Why is the government treating the environment as a second-class matter? Why does it not have an action plan for the Budget?


Donald Frank Mazankowski: Mr. Speaker, with respect, that statement is absolute nonsense. The fact of the matter is that this government has a tremendous environmental record. The Prime Minister has made a commitment.


Some hon. members:: Oh, oh!


Donald Frank Mazankowski: Obviously, the hon. members were not paying attention when I reeled off the long list of environmental initiatives that this government had undertaken.


Mr. Crawford:: Rhetoric.


Donald Frank Mazankowski: The hon. members cannot have it both ways. On the one hand, they argue that there is
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inadequate consultation with the people of Canada, and on the other hand, they want firm action right now. Well, they will get firm action as soon as the consultative process is completed. I know very well that the hon. member will be very pleased with the action plan that the Minister of the Environment will unveil.


GOODS AND SERVICES TAX
Mr. Mac Harb (Ottawa Centre):: Mr. Speaker, my question is directed to the Minister of Finance.
On page 8 of the GST brochure published recently for small business there is an accounting table which implies, wrongly, that small businessmen can collect their accounts receivable at the same rate as their outstanding bills.
Mr. Speaker, I want to ask the minister to give us one example of a small business likely to use such an unrealistic accounting procedure, and to explain why he used such a misleading example in a brochure aimed at helping small business understand this unfair tax.


Michael Holcombe Wilson: Mr. Speaker, my hon. friend is asking a question which would be more appropriate outside of Question Period. However, if he would like to provide me with the specifics of a detailed question like that, I would be happy to respond to it.
What is proposed in this booklet is an illustration of how the accounts of a small business can be conducted for purposes of calculating the goods and services tax. My friend would be quite interested in knowing that about 25 or 30 per cent of the calls to the 1-800 number for the GST are asking for the precise information that we are giving in this type of a book and in other brochures that we have prepared for the Canadian people.


Mac Harb: Mr. Speaker, I cannot believe it. This is the minister who said this tax was so simple, so easy to understand.
Will the minister admit that even the so-called simplest aspects of his tax are based on a lack of understanding of small business, and how small business works? If the minister cannot understand small business, how does he expect small business to understand him and accept his tax. Will he, right now in this House, withdraw the

February 8, 1990
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brochure which was sent out to over 1.8 million people and withdraw this tax?


Michael Holcombe Wilson: Mr. Speaker, I have made it absolutely clear to this House that we are not going to withdraw the tax. What we have looked at on many occasions in discussing this matter with members of the House, are alternatives. What are the alternatives for a goods and services tax? The Liberal opposition has no alternatives. I have requested alternatives from the Leader of the Opposition, the finance critic of the Liberal party, and I will ask the member for Willowdale, if there are alternatives that the hon. members would like to put forward, we will be happy to review them.


THE ENVIRONMENT
Mr. Jim Fulton (Skeena):: Mr. Speaker, my question is for the Deputy Prime Minister. As he knows, the Minister of the Environment, on behalf of the government, promised environmental assessment legislation in the spring of 1989 for the fall of that year, and we still do not have it. He promised last fall that there was going to be a five-year action plan announced around budget time and that, apparently, is one or two weeks from now.
Since this government has had five years to come up with an environmental action plan and still does not have one, can the Deputy Prime Minister give us a date when there is going to be an environmental action plan which has what the minister promised, a plan of action, a list of concrete measures, the amounts that will be spent and a clear timetable? When do we get it, 1990 or 2000?


Mr. Lee Clark (Parliamentary Secretary to Minister of the Environment):: Mr. Speaker, the hon. member asked whether or not the government's comprehensive action plan would be available in 1990 or 2000.
I can say to the hon. member that after the appropriate period of consultation with environmental groups, with industry, with provincial government representatives, there will be both legislation introduced into this House and an action plan deposited in this House in the year 1990.


James Ross Fulton: Mr. Speaker, my supplementary question is for the Deputy Prime Minister, again on behalf of the government. On Monday this government voted against completing the national parks system by
the year 2000, even though the Minister of the Environment is on the public record, on behalf of the government, promising the completion of the national park system by that year.
Would the Deputy Prime Minister advise this House whether or not sufficient planning, staff and funds are in place to complete Canada's national park system by the year 2000? Yes or no.


Donald Frank Mazankowski: Mr. Speaker, as the hon. member knows, this government reformed the National Parks Act in its last mandate. It has allocated major new funding to Canada's historic buildings and sites.
As a matter of fact, we established the first national marine park at Bruce Peninsula, the Rouge River Wilderness area, $106 million to South Moresby for the creation of a national park in an area of sustainable development, which I am sure the hon. member supported. We created six new national parks which protect over 40,000 square kilometres.
Mr. Speaker, that is a record. That is a solid record of progress and achievement.


HOUSING
Mrs. Barbara Sparrow (Calgary Southwest):: Mr. Speaker, my question is for the Minister of State for Housing. Violence against women is intolerable, unacceptable, and it must be stopped.
In June 1988, Canada Mortgage and Housing Corporation, in conjunction with National Health and Welfare, allocated $22 million to support the development of emergency shelters for victims of family violence.
To date, I have not heard any further news with regard to this $22 million. In light of what happened Monday in Calgary when a woman was sexually assaulted at a busy intersection, can the minister please tell this House what has happened to this program and just where the $22 million has been allocated?


Hon. Alan Redway (Minister of State (Housing)):: Mr. Speaker, the hon. member is referring to a program known as Project Haven under which the federal government committed to pay for some 500 new hostel rooms
February 8, 1990

across the country for women and children who are the victims of family violence.
As of the end of last year, some 100 of those allocations had been committed. We expect that some 275 more of those units will be committed by the end of June.
Unfortunately, at the moment we have not been able to reach any agreement with the province of Ontario or the province of Prince Edward Island with respect to these allocations. In Alberta, we have put out two proposal calls for bids. We have received only seven expressions of interest, unfortunately none of those were in the city of Calgary. I hope that the hon. member will encourage the social housing groups in the city of Calgary to put in submissions so that units can be built there.


FISHERIES
Hon. William Rompkey (Labrador):: Mr. Speaker, my question is for the Minister for International Trade. It is 24 hours later and the situation at National Sea Products in St. John's still has not been resolved. The union has rejected the National Sea plan. My question is very simple. With all the authority that the Government of Canada has under the Fisheries Act, why has it not acted to help the hundreds of workers who are out of work?
Let me throw the minister's own words back at him, when is he going to get off his duff and do something about National Sea?


Hon. John C. Crosbie (Minister for International Trade):: Mr. Speaker, it is hard to tell whether or not the hon. member understands the situation with respect to the east coast fishery.


Mr. Robichaud:: You don't understand it.


Mary Catherine Clancy: We understand it all too well.


Mr. Speaker:: The hon. minister has been asked a question. I am sure that hon. members would want him to answer it. The hon. minister.


John Carnell Crosbie: Thank you, Mr. Speaker. There is a problem with the availability of the resource to National Sea. They have lost in the last several years something like 159 million pounds of quota to process, so they no
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longer have this fish to put through all of their plants and had to make a decision to close several plants.
After considerable urging from myself, and others, they have now come up with a plan that would provide, on a permanent basis, 100 full time jobs in a shrimp shucking operation at the St. John's plant; 170, if the workers agree to time share, and another 130 workers would be employed in trawlers and in landing fish at the plant. So that would be about 300 people who would retain employment out of the 450 affected by the present lay-off notice.
In addition, the government of Newfoundland entered into an agreement with the company so that the company would operate on the present basis until August 5, thereby extending the period of notice by some four or five months.
Now I think that the workers should consider carefully the proposal that the company has made and consider what the alternatives are, because there does not appear to be other alternatives.


Bill Rompkey: Mr. Speaker, my supplementary is for the same minister. Yesterday, he told us that unemployment insurance was the salvation of Atlantic fishermen.
I want to tell him that 50 per cent of the fishermen and plant workers in my riding did not qualify for unemployment insurance this year. The plan which this government has gutted is useless.


Some hon. members:: The Senate.


Some hon. members:: Oh, oh!


Mr. Speaker:: Surely on an issue such as this, hon. members should let questions be asked and answers given. The hon. member will repeat the last part of his question.


Bill Rompkey: It is very simple, Mr. Speaker. When is the Government of Canada going to keep its commitment to the fishermen and plant workers of Atlantic Canada and offer something substantial and not simply the paltry $130 million that they have been offered so far?


John Carnell Crosbie: Mr. Speaker, $130 million is $130 million more than was ever offered by the government when the hon. member was in the government.

February 8, 1990
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In addition to the efforts being made by National Sea, the government of Newfoundland and ourselves to keep plants operating, as well as the offer made by National Sea in connection with the St. John's and Canso plants, the government is providing a five-pronged program, including community development funding, and including the POWA program which applies to people over 55 who are laid off and cannot be retained or find other jobs. There is a special supplement for those who are over 50. There are other programs such as Community Futures and industrial adjustment.
That is what has been offered to help the 250 who might be left out of work as a result of the unfortunate experience at National Sea at St. John's. That is what has been provided. That is a serious effort to help these people. The company is ready to operate to take care of at least 300 more through this proposal, and I do not think that it is a proposal that should be hurriedly thrown away. What is the alternative? If the company does not have fish to process, what can it do?


REGIONAL DEVELOPMENT
Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, my question is for the Deputy Prime Minister. The people of Atlantic Canada in the fishery industry are looking to this government for help. The Minister for International Trade says there are existing programs out there which were out there before the fishery crisis came.
Even the conventional programs are being reduced because the subagreements under ACOA have been drastically cut back. In Nova Scotia alone, the subagreement that was $7 million a year has been reduced to $1.2 million a year, a reduction of 83 per cent.
When is the government going to at least bring those subagreements back to historical levels, and when are the people of Atlantic Canada going to get some answers?


John Carnell Crosbie: Mr. Speaker, the hon. member must be trying to become the prime joker in the opposition. There has never been such a level of funding for regional development in Atlantic Canada as the present fiscal year, over $500 million. When the hon. gentleman's government
was in office the maximum they got to was $185 million, which is one heck of a lot less than $500 million. If the hon. gentleman knows how to subtract one from the other, it is $315 million less when the hon. gentleman's government was in office, so stop pitying us.


Russell Gregoire MacLellan: Mr. Speaker, I cannot believe that the Minister for International Trade would actually come forward with such absolute balderdash and absolute nonsense.
This government knew last February that the fishery stocks in Atlantic Canada were in serious decline and only a fraction of what they previously estimated them to be. Yet the Minister of Finance in his last budget cut drastically the ACOA financing. How can the people of Atlantic Canada rely on this government? Will the Minister of Finance today stand up and say that he is going to replace that financing and help Atlantic Canada?


John Carnell Crosbie: Mr. Speaker, facts are facts. From 1979-80 to 1983-84, regional development assistance in Atlantic Canada averaged $185 million a year. Then in the years from 1984-85 to 1988-89, the average was $282 million a year. Now we are in a five-year period where the average will be $425 million a year.
As a matter of fact, tomorrow in St. John's, Newfoundland there will be another announcement showing continuing spending under development agreements in Atlantic Canada. What is wrong with the hon. gentleman, can he not appreciate a good program and spending when he sees it?


RESEARCH AND DEVELOPMENT
Mr. Howard McCurdy (Windsor-St. Clair):: Mr. Speaker, there is outrage today throughout the scientific community. The scientists at NRC are demoralized as a result of the hatchet job being done at NRC. Scientists, such as David Wiles at chemistry are being muzzled.
I would like to direct a question to whomever is speaking on behalf of the Minister of Science and Technology. Will she confirm that it is the intention of the government to announce the break-up of the chemistry division, of the physics division, and will she tell us what else they intend to do to cut back on expenditures
February 8, 1990

at NRC as they are going to cut back on science generally?


Mrs. Suzanne Duplessis (Parliamentary Secretary to Minister of State (Science and Technology)):: In response to the question of my colleague from Windsor-St. Clair, Mr. Speaker, I want to assure him that there was no new cut-back at the National Research Council. The article in today's Citizen is obviously an expression of concerns on the part of various NRC researchers.
Mr. Speaker, the National Research Council is busy drafting its long-term plan. This document has yet to be submitted to the government and no decision has been made.
I believe the plan will be sent to the minister in late spring, so that is what we are waiting for, Mr. Speaker.


Howard Douglas McCurdy: Mr. Speaker, my supplementary question is directed to the Minister of Finance. I ask him to confirm that he recently met with the Prime Minister, with the National Advisory Board on Science and Technology, swore the members of that committee to secrecy under the Official Secrets Act, and informed them of the future cut-backs in science expenditures by government. I ask the minister to tell us to what extent such expenditures will be cut and in what percentages?


Michael Holcombe Wilson: Mr. Speaker, my hon. friend is really groping with that question. There was no swearing to secrecy of the members of the NABST to tell them what might or might not be in the budget. There was no discussion of what might or might not be in the budget at that meeting with the National Advisory Board on Science and Technology.
Those were the meetings that the Prime Minister chaired a week or so ago. They were very productive meetings, talking about where we were going to proceed as a country on the development of a greater level of science and technology; how we were going to improve
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the educational levels of our scientists in this country; how we were going to improve the co-ordination of science-


Mr. Speaker:: The hon. member for Beaver River.


OFFICIAL LANGUAGES
Miss Deborah Grey (Beaver River):: Mr. Speaker, I would like to direct the Houses's attention to the question of official bilingualism.
The Prime Minister has condemned recent declarations of official unilingualism in certain Ontario municipalities. I do not question the Prime Minister and the government support for official bilingualism.
Therefore, my question to the Deputy Prime Minister is this: Will the Prime Minister and the government also be urging the government of the Prime Minister's own province to declare Quebec an officially bilingual society with full equality of official status to both French and English?


Hon. Doug Lewis (Minister of Justice and Attorney General of Canada):: Mr. Speaker, the House will know the interest of the Official Opposition and the government in debating this important issue in this House. In fact, we have put on the Order Paper a motion that this House reaffirm its commitment to support, protect and promote linguistic duality in Canada as reflected by this House in the Constitutional Amendment, 1987 and the Official Languages Act, 1988. That is the official policy of this government.


Deborah C. Grey: Unfortunately, Mr. Speaker, we are seeing it inside Quebec and outside Quebec, in fact in all of Canada. Anyone who claims to support the policy of official bilingualism must face the fact that many Canadians, whether we in this House like it or not, see official bilingualism as heavy-handed and exerting a double standard, and of course there are many examples of this, including the actions of a committee in this House last June.
I would be interested to know, and many Canadians would as well, why the selective outrage over official uniligualism?

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Douglas Grinslade Lewis: There is no selective outrage on behalf of this government or on the part of this government.
Mr. Speaker, this is a very serious issue which all members of this House treat seriously and about which all members of this House in one way or another are on the record. I think it is about time my hon. friend got on the record.


Some hon. members:: Hear, hear!
I wonder if we could have at least a couple of hours of serious debate on interest rate policy. That could be reflected by moving concurrence in the finance committee report next week.


Douglas Grinslade Lewis: Mr. Speaker, we have been trying to allocate as many opposition days as possible. It is quite possible that there will be one allocated next week, at which time my hon. friend will have the opportunity to debate that issue.



GOVERNMENT ORDERS


Jean-Robert Gauthier: Mr. Speaker, I want to ask the government the usual Thursday business question. What does the government intend to bring forth this Friday, and Monday and Tuesday next?


Some hon. members:: Hear, hear!


Douglas Grinslade Lewis: Mr. Speaker, I want to take this opportunity to officially welcome my hon. friend to his duties as opposition House leader. We have all worked with him before. We recognize the challenge and his ability.
I would like to advise the House that tomorrow we will deal with Bills C-5, C-25, C-44 and, if there is time, Bill C-45.1 realize this may sound like a full program, but I believe there have been discussions among the parties as to exactly what can be completed.
On Monday morning we will deal with Bill C-26, the grains and flour subsidies. Possibly in the afternoon we would take another look at Bill C-52, the income tax bill regarding pensions.


Nelson Andrew Riis: Mr. Speaker, I would like to raise a point of order with my hon. friend the government House leader. He has given us an idea of the business for tomorrow and Monday, at least the government's intention. We all recognize the importance of interest rates. My hon. friend would know that the hon. member for Yorkton-Melville moved a motion of concurrence in the finance committee report that was studying high interest rates and had some very useful recommendations.


ALLOTTED DAY, S. O. 81 -GOODS AND SERVICES TAX
[Stage Direction]
The House resumed consideration of the motion of Mr. Young (Gloucester):
That this House call upon the government to abandon its ill-conceived goods and services tax scheme and to bring forward in its place a comprehensive reform of the tax system that is fairer, simpler, integrated, taking into consideration all forms of taxation and the needs and practices of other levels of government and that this be clearly visible to the taxpayers and designed in a manner that does not merely, under the guise of reform, constitute another increase in the overall burden of taxation.
The Acting Speaker (Mr. Paproski):: When the House rose at one o'clock, the hon. member for Esquimalt- Juan de Fuca had the floor.


David Barrett: Mr. Speaker, I just want to carry on with the thrust of my discussion about the official opposition's motion on the goods and services tax.


An hon. member:: A loonie tax.


David Barrett: Exactly, on the loonie government, relative to the coin.
Before we were interrupted by a break the House took to reflect on my comments-


Jean-Robert Gauthier: I went to have lunch.


David Barrett: What I had to say this morning is best summed up by the member for Burlington's tie. The member for Burlington wears a tie today that expresses for all of us in the New Democratic Party exactly what we think of the goods and services tax. I challenge the member for Burlington to let his colleagues know what is on his tie. Never mind what is on his mind, just his tie. It

February 8, 1990

expresses completely how we feel about the goods and services tax.
In spite of all of their protests on the goods and services tax, when the Official Opposition was asked this morning if the Liberal party was given the confidence of the people of Canada to form a government after the next election would they remove the goods and services tax, the answer was, no.


Some hon. members:: Shame.


David Barrett: Not every Canadian heard this. I know there is great interest in this land because I am speaking this afternoon. I know that 90 per cent of the nation is glued to their television tubes this afternoon to hear what I have to say. For the other 10 per cent, I want to repeat that the Liberal party's policy on the GST is straight hypocrisy. In this Chamber, of all places to have a political party be hypocritical. It is unprecedented.


An hon. member:: You are new.


David Barrett: I am new. But that is what I thought. Then I discovered how the game is played in this House. When there is a serious question to the government by the Official Opposition on this tax which protects the rich, the government's immediate response is: "You created the mess when you were in government". Then the official opposition has its chance to respond: "No, we did not. You made it worse". This game goes on. Those two parties have learned a great formula that my former leader in this House, T. C. Douglas, used to talk about. They learn how to take money from the rich and votes from the poor, with a promise to protect them from each other.
As far as the Conservative party is concerned, they have their own philosophy. They believe in the truth, until they find out what it is.
I find it interesting that this government denies it is issuing propaganda. I want to make you aware of a little incident that happened in what is considered as the territories, as far as most of this government is concerned. It is known as the province of British Columbia.


An hon. member:: I remember it well.


David Barrett: You remember it well, my friend. It is not often thought of by this government. Alberta has been abandoned. But, that is another story.
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Alberta's Conservative members of Parliament, except for the Speaker of the day, are going down the tube. We have a requiem political high mass for the end of the Alberta MPs from the Conservative party. Those nonames, those no-records, those people we never got a chance to meet are going to go so fast after the next federal election that we will not even have a chance to socialize with them.


An hon. member:: Where are they now?


David Barrett: "Where are they now?" is a good question. I will tell you-


Ron J. Duhamel: Time!


David Barrett: Not yet, not yet. They have another two and a half years, then their time is up. Let me read about what has happened in my province. An article in the Victoria Times Colonist relative to this debate was headlined: "Ottawa sent GST propaganda, but she has to pick up the tax form". I am going to send a copy of this article to the Minister of Finance from downtown Bay Street.
The minister stands up and folds his hand and his thumb-it is a very expensive gesture by a lawyer. If he holds his hand up this way, it is $500 bucks an hour; if he extends it, it is $750. He is a thousand-bucks-an-hour lawyer.
The minister tells us how the government sends out this information to assist the taxpayers in understanding what is going on. The bill has not passed the House yet. The government invoked closure. But, this is what happened:
A four-page pamphlet of Goods and Services Tax information and questions is no substitute for a tax return form-especially when the federal government tells you it is trying to save you money, says an irate Sooke resident.
Pauline Atterbury is hopping mad that Revenue Canada sent her the GST information but, in the same package, told her she will have to pick up her tax-return form from the nearest post office.
Fourteen million bucks worth. I quote further from the article:
"I have to make a six-mile round trip to get my form but they say this is part of their ongoing effort to reduce costs," Atterbury said.
"They are spending our money to send propaganda for a tax no one wants and then I have to spend gas money to go to get my tax return- thanks a lot fellas," she said.

February 8, 1990
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No wonder she is hopping mad. No wonder there is cynicism out there. No wonder there is anger.
The Minister of Finance said he would go anywhere in Canada and debate with anyone this question of the GST. I am going to make a courageous challenge that I want you to listen to very carefully. I am prepared to go into Calgary, Alberta, where we have a history of famous elected socialists, since the last provincial election, and challenge the Minister of Finance to stand up with me in any hall that I want to rent or that he will attend. Let's have a public debate in Calgary between the Minister of Finance and myself. He can speak on behalf of the GST and I will attack it. We will invite the Alberta MPs to sit in the front row and witness it.
I do not want to shock young children or senior citizens of this country, but he is not going to take up the challenge that he himself suggested. He was not really serious when he said he was prepared to discuss the GST anywhere in Canada with anybody. He even voted for closure.
As we go to committee, I want the Canadian public to know that the committee is going to stay in downtown Ottawa. The members of the committee are going to eat breakfast here, lunch here and supper here, pay their tips for these meals before the GST comes in and they are going to have closure in the committee because they will not allow Canadians, right across this country, to see them. Not only is the minister frightened to take up the suggestion of being heard across the country, but the committee will refuse to move out of this town.
I predict that not only will the Liberals continue their flim-flam and support this bill behind the curtains and wait to be in government when they will keep it, at the same time the committee will refuse to hear witnesses from across Canada. We can see closure here in this House against the members of Parliament. But the worst step will be closure to the people of Canada who will not see the committee leave this town. I say shame, Mr. Speaker. Shame on the Minister of Finance. Shame on the committee. Shame on those Tories who will not be back. And shame on all of us that we allow this kind of closure to be rammed down our throat and think that the taxpayers do not know what is going on. There will be a taxpayers' revolt. I hope you survive. I know a lot of
those guys there will not. Say goodbye now because we will not be seeing them after the next election.


Mrs. Marleau:: Mr. Speaker, I have been sitting here in the House. I listened to my friend on the left and to all of the wonderful words that he spreads; the verbiage, the grandstanding and all of the fear about the Liberal party. He should remember though that there is another two and a half years to go. I remind him of that.
This is an opposition day and we have a motion put forward by a member of the Liberal party. I am going to read it for him and ask him a question.
The motion reads:
That this House call upon the government to abandon its ill-conceived goods and services tax scheme and to bring forward in its place a comprehensive reform of the tax system that is fairer, simpler, integrated, taking into consideration all forms of taxation and the needs and practices of other levels of government and that this be clearly visible to the taxpayers and designed in a manner that does not merely, under the guise of reform, constitute another increase in the overall burden of taxation.
Does the hon. member support this motion or not?


David Barrett: Mr. Speaker, I support the motion. Unknown to a large number of that group over there, I am over 21. I have seen the Liberal party in action before. This kind of motion, this kind of promise, this kind of commitment goes under the category of b.s. The Liberals have about as much support for this as they have for the person who wrote it. They probably wrote it from a 'help wanted' or some petition.
You have no more commitment to this than the Liberal member who answered my question. I asked: as a political party, as the leadership candidates, as members of this House, will you give a solemn pledge that should you be returned to form a government that the first act you will do is immediately withdraw the goods and services tax? They will not.
My friends in the Conservative party have decided on a matter of principle to commit suicide. It is their right. They will not back off this. They intend to ram this through because once giving their word to the corporate elite of this country that they are going to protect them by further taxing the middle-class and the working poor of this country, they are going to deliver.
The greatest fraud in this debate is the Liberal party. They are clucking, chuckling and laughing behind the curtains every day. They know very well. I ask them in the House to confess their sins. I will listen but none have stood. Not one of the leadership candidates and no
February 8, 1990

one here in this Elouse has said: "On my soul, should I be returned to office, we in the Liberal party will do away with the tax." They will not. Furthermore, the Liberals will keep the tax.
I can hear the speeches now as they switch roles in the House. They will say: "Oh, we've just been elected. We've discovered the mess we have inherited from the Tories. Oh, it is worse than we thought, Mr. Speaker, and as a consequence we have to keep the tax and we are forced to put it up to 10 per cent". I can see the speech now from their minister of finance. Pick any one you want. It does not matter. It is a plastic speech from the Liberal party. They will stand up and they will say: "Oh, my goodness. The Tories have ruined this country and we have to increase the tax".
There it is. I conclude my remarks by saying there is no difference in those parties. One is in, the other is out, and they both have the same purpose: serve the rich.


Ron J. Duhamel: Mr. Speaker, I am tempted to ask the hon. member why he chooses to be so unfair and insensitive and make so many erroneous statements about my party. Some of the comments bordered on the malicious and perhaps even the vindictive. I am delighted, however, that he will be supporting this motion. I will ask him another serious question.
He knows that most Canadians believe that the NDP does not have a credible economic policy. Does this lack of credibility in the economic area limit the effectiveness of his own and his party's attack on economic matters in Canada, including the goods and services tax?


David Barrett: I thank the Liberal member for finding the question that I wrote out for one of my colleagues. I want to thank him for doing the job for me.
Not only do we have a plan but we have been responsible in laying it out word for word, item by item, idea by idea. Whether you agree with my ideas or not, the point is that we put them in writing, we put them down as serious proposals. The Liberal party has not done that. These guys are write-offs, they are gone. Goodbye, nice knowing you.
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Those members are prepared to ride down the middle with no commitment to say where they stand. The first response to the proposals made by my colleagues who have done a great deal of serious work on this was to do a great deal of handwringing. The first response was that it is socialism. I remind them, was it not true that it was this group who created socialized medicine? If this government and that opposition is against socialism I want everyone of them to stand up in this House today and rip up their medicare card and stop sucking off the taxes of the poor and the middle class while benefiting from a socialist program. I hope this does not go out on television to the Canadian people and they get exposed to the fact that these members live off socialist programs while they are attacking our ideas all the time.
I do not wish to be partisan but the question has forced to me to respond in a partisan manner. Every single idea that this party has expressed in social policy and economic policy that now benefits this country, from UIC to socialized medicine, has come from this party over in this comer.


John Carnell Crosbie: Will the hon. gentleman permit a question?


David Barrett: Permit a question? My friend, I am always willing to take a question from you, but not on my time. I conclude by saying to members that I love you as individuals. I do not like your party and do not like its history. I love you as individuals. It is unrequited love. You do not like me in return. I am broken-hearted about that temporarily.
It is the same old game with the same old two parties. They represent a special interest in this country and there will be no change one way or the other. The only party that is committed in terms of serving the average person in this country is the New Democratic Party. I say that in a non-partisan manner.


John Carnell Crosbie: Mr. Speaker, my question to the hon. gentleman is this: Is he feeling lonely because there are only, as far as I know, two socialist parties left in the world today. Two and one-half: One-half of the official opposition is socialist in its tendencies; the NDP here in Canada and Mr. Mugabe in Zimbabwe. These are the only two and a half socialist parties left today.
They have disappeared in eastern Europe. We had a representative from Hungary in the gallery earlier today. They are all now going to be market driven. They are embracing the market. When is the hon. gentleman and those who contested him in the NDP leadership going to

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get up to date with the eastern European governments which led us in socialism for 40 or 50 years? They are now running away from it as though they had the trots. They no longer have Trotsky, they've got the trots in their haste to get away from socialism. Why is he clinging to this outmoded, decrepit philosophy?


David Barrett: Mr. Speaker, first of all I would like to respond to my good friend who is a graduate of the London School of Economics. He knows very well that that school of economics has had an influence on the governments that are now in place in New Zealand, Australia, Denmark, France, and in half of the industrialized countries of this world where social democrats are in power.


An hon. member:: And the Yukon.


David Barrett: And the Yukon. It was the democratic socialists who were first shot by the communists. Let us get that straight. It is the social democrats, since the turn of the century in the industrialized nations of this world, who have stood up for human rights, for economic pluralism and for social justice on the basis of an individual having a right and an equal chance in a society that plays no favourites. We have suffered from the extreme left because of that and the extreme right, but the world is turning toward the kind of goals my party has stood for since the very inception of the Christian socialists who are part of the foundation of this party.
I am proud of the heritage of this party. I do not mind those questions and attacks. The results speak for it. This world is a better place because of democratic socialism. Eastern Europe is now rediscovering that fact since the death of Shcharansky. The west, particularly the United States, will rue the day that they too have not had an influence of social democrats to humanize their corporate society.
Just reflect on the violence in the urban centres of the United States and its consequences and causes. Just reflect on the isolation and the destruction of the human family in a corporate empire that does not even have an iota of socialized medicine. Thank you for my chance to
give a brief lecture to my friend who has long forgotten what he learned in the London School of Economics.


The Acting Speaker (Mr. Paproski):: Questions and comments are now terminated. Debate. The hon. member for Outremont.


Nelson Andrew Riis: Mr. Speaker, I rise on a point of order. I do not want to interrupt my hon. colleague in his debate, but having now completed the first round of speakers, it has been a tradition on opposition days that if the parties wish, they take their 20-minute periods for debate and 10 minutes for questions and comments and split it up into a 10-minute debate with a five-minute question and comment period, if they so wish.
I would like to have the unanimous consent of the House to allow us to proceed that way today as well.


Mr. Boudria:: Mr. Speaker, perhaps in giving our consent to what has been offered by the hon. member for Kamloops, I could make the following suggestion on behalf of our caucus. We wish to notify the Chair now that for the remainder of the afternoon all the speakers from the Liberal party will be utilizing the 10-minute format plus an immediate five-minute question and answer period, if the other parties are willing to provide unanimous consent for that so that we do not have to ask it every time one of our speakers rises.
In other words, we will have one 10-minute speaker followed by a five-minute question and answer period, followed immediately by another 10-minute speaker and another five-minute question and answer period for the rest of the afternoon as it pertains to the Liberal party.


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


Some hon. members:: Agreed.


The Acting Speaker (Mr. Paproski):: Agreed and so ordered. The hon. member for Outremont.


Mr. Jean-Pierre Hogue (Outremont):: Mr. Speaker, I am pleased to take part in this debate on the Official Opposition's motion. I am doubly pleased because this motion gives us another opportunity to praise and present the advantages of the goods and services tax. The GST is a considerable improvement over the pres-
February 8, 1990

ent federal sales tax, for three reasons. It will encourage economic growth and job creation, while putting our businesses on an equal footing with their foreign competitors, both on the domestic and on the export market.
Thanks to the GST tax credit, the new system will distribute the tax burden more fairly than ever before in Canada. Moreover, by providing a more reliable source of revenue and by stimulating economic activity, the GST will contribute to the national deficit reduction effort.
Mr. Speaker, the GST is therefore a fundamental, and also an essential, change. Many studies have shown that the present manufacturers' sales tax seriously affects our firms' ability to compete. It thus hurts economic growth and job creation in Canada. The present tax, as you know, is also a brake on investment.
The GST will therefore stimulate investment by eliminating the federal sales tax on goods and services which for many years have been used to produce other goods and services. We will eliminate the tax on production and as a result, investment, capital stock and the economy's productive capacity will grow.
Mr. Speaker, economic activity and production in all regions of Canada will benefit from the GST. The Atlantic provinces and Western Canada stand to gain the most because a good part of their economy is made up of capital-intensive or exporting industries. These industries will be the main beneficiaries of the GST refund for business inputs. Nevertheless, Ontario and Quebec will of course also obtain economic benefits-and rightly so-amounting to billions of dollars in new activity and thousands of new jobs.
The motion before us, Mr. Speaker, asks that we abandon our proposed GST. Why, Mr. Speaker, abandon a reform that will give the Canadian economy and all Canadians so much? Why abandon the reform of an obsolete, destructive and outdated tax system? After a certain number of years, models and techniques may become obsolete, and this tax is definitely obsolete. We must develop a new approach that, as I said earlier, will thoroughly change the situation and provide for more equitable treatment for all Canadians.
One of the reasons why Canadians gave us a majority in two consecutive elections is because the Progressive Conservative Party does not abandon ship. Mr. Speaker,
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we do not intend to abandon senior citizens, as they say we would, or low-income families that will benefit from refundable tax credits. We will not abandon our entrepreneurs, our manufacturers and workers who every day have to deal with the obstacles created by the present sales tax, which as I said before, is definitely obsolete. A responsible government does not abandon ship at a critical moment in its country's history. A responsible government like ours keeps going ahead and perseveres despite the obstacles.
Mr. Speaker, the motion refers to fairer tax reform. That is exactly what we are suggesting with the GST. You must not forget that the GST is part of a comprehensive reform of the tax system. Our government took the initiative for that tax reform.
During the first stage, the Progressive Conservative Party converted personal exemptions and a large number of deductions into tax credits, to make the system more equitable. It also reduced and eliminated altogether a large number of special tax concessions.
The government also abolished or reduced many corporate tax concessions, and we have expanded their tax space so that profitable companies now pay more income tax.
With the GST, the overall tax burden will be more progressive, and low-income Canadians will be protected. The tax credit will help to direct assistance to those who need it most. As a result, we have a goods and services tax that improves the overall fairness of the tax system.
The GST credit will be paid to about 8.7 million families and individuals. The first cheque will be mailed in December 1990, before the GST comes into force on January 1, 1991. The tax credit will be paid in advance, four times a year.
The basic credit will be $190 for an adult and $100 per child. Single parents will be entitled to an adult credit of $190 for one dependant child. Furthermore, adults living alone, including single parents, will be entitled to a supplementary credit of up to $100.
For instance, a single parent with two children and a net income of $20,000 will be entitled to an adult credit of $190, a supplementary adult credit of $190, a child credit of $100 and a supplementary credit of $100. In other words, this single parent will be entitled to a total of $580 in GST credits.

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The credit will start decreasing at about $24,800 in 1991. Beyond that point, it will level off gradually, and a family of two adults and two children will be entitled to a credit if their net income is less than $36,400.
Therefore the credits will go to those who need them the most.
More affluent Canadians will pay their fair share of taxes.


Peter Andrew Stewart Milliken: Nonsense!


Jean-Pierre Hogue: They cannot avoid the GST. Since they consume more, they will pay more. To help reduce the GST rate, the present 3 per cent surtax applicable to high-income Canadians will be raised to 5 per cent effective January 1, 1991 and its threshold will be lowered from $15,000 to $12,500 in basic federal tax.
I see, Mr. Speaker, that my time is up and I am wrapping up. The GST is fair and meets the other criteria outlined in the motion now before the House. It is fair and consistent with the nature of our society.
Mr. Speaker, I am proud and I thank you for the time you gave me.


Peter Andrew Stewart Milliken: Mr. Speaker, I listened to the speech made by my friend, the Hon. Member for Outremont (Mr. Hogue), and I want to ask a question and make a short comment. However, the book I am referring to is in English, so I hope he will excuse me if I read something in that language.
The Canadian Federation of Independent Business recently submitted a pre-budget brief to the Minister of Finance. The hon. member who spoke in such laudatory terms of this wonderful goods and services tax that his minister is putting before the House will want to hear the words of the federation. Their brief states: "At a time of supposed government restraint the addition of such an enormous bureaucracy"-and they are referring to the 4,000 tax police-"to duplicate effectively existing provincial retail sales tax bureaucracies defies belief."
Another quotation that I found most interesting and that I know will be of great interest to the hon. member for Outremont is found on page 4 of the brief. It says:
To date, the GST process has been driven with undue haste to the detriment of all Canadians. In the province of Quebec, for example, where the provincial government is openly discussing the revamping the sales tax system, the federal government has not held hearings. Why has Quebec been ignored in this debate? Leaving Quebec out of the consultation process is especially reprehensible when considering that the small business community in that province has a structural make-up which is unique in this country. There are a greater number of small retail businesses in Quebec than in any other part of Canada. The GST will therefore have an even greater negative impact on small firms and consumers in Quebec.


Mr. Blenkarn:: Nonsense.


Peter Andrew Stewart Milliken: The hon member for Mississauga South is getting a little exercised. He is the chairman of the committee that should be holding these hearings. I suggest to him that when his committee meets to discuss where the hearings will be held on the bill which has now been referred to committee, he get moving and have some hearings across-


The Acting Speaker (Mr. Paproski):: Order. I would hope that the hon. member would direct his question to the hon. member for Outremont.


Peter Andrew Stewart Milliken: I was about to do that. I would like to ask the hon. member for Outremont how it is, with statements like this from a respectable organization such as the Canadian Federation of Small Business, an organization I may say that is not a particular friend of the Liberal Party, or at least has not been until recently, that he would ignore these statements and make a speech that supports this dreadful tax the government has imposed instead of condemning the tax and voting against it at every opportunity.


Jean-Pierre Hogue: Mr. Speaker, the hon. member for Kingston and the Islands (Mr. Milliken) will, I am sure, be agreeable to my answering in French.
We sit on certain committees, and we manage to move the ship of state in the right direction. The hon. member had two questions: One about the bureaucracy, and the second one, I believe, about the apparent lack of consultation in Quebec.
It is not my place to answer on behalf of the government. The question was put to me, and I will have to respond accordingly and give my view on the matter.
Mr. Speaker, I believe this tax comes at the right time, and it does because the situation demands it. As the hon.
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member is aware and with him other members of this House who certainly share my point of view-


Don Boudria: No, we do not share your point of view.


Jean-Pierre Hogue: -things happen when they are supposed to happen.
If we put on too much pressure, there is a negative impact on the socio-economic situation, things do not run as smoothly as they should and society does not benefit at all.
In the past few days, we have spent hours discussing the merits, and also the weaknesses which I do not feel are apparent, of this new way of letting Canadian society develop, in other words, of collecting taxes. In 1990, our society cannot hope to function with instruments and techniques that have long become obsolete.
A tax is not necessarily perfect when it is implemented, and I am sure everyone accepts that. The same applies to just about everything in life. You can draw a car model on your draft board but people will want changes.
Clearly, this tax will undergo minor adjustments, and thanks to the wisdom and common sense of this party and the Minister of Finance.


Mr. Speaker:: The time for questions and comments has expired. The hon. member for Cariboo-Chilcotin has the floor for 10 minutes, plus 5 minutes of questions and comments.


Mr. Dave Worthy (Cariboo -Chilcotin):: Mr. Speaker, I take pleasure in addressing the motion before us. It is a very long motion, but it tries to address a very interesting question.
The Opposition is seeking comprehensive reform of the tax system. Of course that in itself is good. They want a fairer, simpler and an integrated system. They are saying they want a fair and effective tax system.
I do not know where the people who drafted this motion have been for the last few days, but that is in fact what we have been debating. The GST is a fair, reformed tax system that has been introduced because this country needs a reformed and fairer system.
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No matter how critical Canadians are of many respects of this country, maybe of the politicians or some of the things that are going on, I have yet to find a true Canadian who is not totally pleased with living in this country. There is not another country in the world where they would rather be.
I would like to build on that theme because the reward and the privilege of living in this country has a price. It is we the citizens of this country who must pay that price. There is no simple solution and there is no easy way out.
This reform of our tax system has been portrayed as a tax grab and a tax increase. It is neither of those. It is a very serious response to a very serious situation. Canada must measure up against some very tough international competition in the months, years and decades ahead, if we want to maintain our quality of life, if we want to meet the payments on our deficit, if we are going to leave our children a country as good as the country in which they were born.
A truly fair tax system will meet these challenges. A truly fair system will contribute to a strong economic policy. A truly fair tax system allows Canadian businesses to make the best possible use of their resources. Under these terms the goods and services tax measures up. It is a fair tax system.
It is this government that initiated tax reform. Stage one was eliminating many of the loopholes, the problems that we experienced in the old tax system so that we could have a better tax system which was more equitable to all. It is through that that the businesses are now paying more and high income wage earners are now paying more than they ever were before.
The second stage of that tax reform is the goods and services tax. Interestingly enough, instead of this system being a tax grab on low income earners, low income people will in fact benefit the most. They will pay less under this new system. On the other hand, the wealthier people, those who have been more fortunate in what they have, who tend to enjoy our services more, buy more goods and more expensive goods will of course be paying more and more because of the goods and services tax. It is a positive form of taxation.
Many seniors have been concerned for their welfare under the goods and services tax. I am happy to inform them that in over 75 per cent of the cases they are going to be doing better under the goods and services tax than

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they did prior to the goods and services tax. They will not be paying tax on their groceries or their medical services. They will not be paying tax through any of their charities or non-profit organizations. They will not be paying tax on drugs, health care or most essential services. For them, of course it is a fairer system.
The social programs for the rest of us Canadians are dependent on an economic system that can support and pay for them. It is for those programs that we need a system such as the goods and services tax. It is a system that will create an economic push for our economy. Many economists have indicated that as much as $9 billion a year will be contributed to jobs and increased wealth for all Canadians. It is this tax that will support the social programs when you and I will need them the most, Mr. Speaker.
It is the engine of the economy, private business, to which we must look to see the end of our deficit and debt problems and the continuation of the way of life we all enjoy in Canada.
I do support the concepts that are in this motion, but I see them endowed in the goods and services tax.


Ron J. Duhamel: Mr. Speaker, the hon. member will recognize that there have been 31 tax increases over the last five years and that the goods and services tax will be number 32. He recognizes as well that the debt has been doubled over the last five years. There have been massive lay-offs in this country, and I cite as an example 2,700-plus at VIA Rail. Just this morning my colleague announced that in his constituency of Winnipeg St. James a battery establishment was closing and another 275 people would lose their jobs.
The member will recall as well that it was his government that attempted to deindex pensions for seniors. Then it brought in the clawback which affects both seniors and families. He will recognize as well the massive reduction to health and education transfer payments to provinces, actually $24 billion over eight or nine fiscal years.
Are the effects of the GST not much worse because of all of these negative measures that have been undertaken by his government? Will the hon. member confirm this reality?


Dave Worthy: Mr. Speaker, I am afraid I cannot confirm that as a reality. We listened to the hon. member for Esquimalt-Juan de Fuca in the last hour. I know that you, as well as I, Mr. Speaker, found his talk very interesting. I think it bears directly on the hon. member's question.
Although the social democrats, as he refers to them, have done a lot-and I think it is acknowledged by all in our society-to make us more aware of the social aspects of society to which we should pay more attention, never have they been renowned for their economic foresight or economic knowledge, especially the hon. member for Esquimalt-Juan de Fuca.
I happen to be over 21 as well, and well remember that hon. member's efforts at helping the economy of British Columbia. Very few people in British Columbia my age will ever forget the efforts.


Brian L. Gardiner: Mr. Speaker, I rise on a point of order. I appreciate the member's comments. I wonder if he has any documentation or information that he can provide to us to compare with his friends in the Social Credit Party in British Columbia who are driving that province into the ground.


The Acting Speaker (Mr. Paproski):: The hon. member for Cariboo-Chilcotin has the floor.


Dave Worthy: Mr. Speaker, I acknowledged in my speech that most Canadians will recognize that we in Canada have never been better off than we are now, in spite of the fact that we are still burdened with a debt and a deficit legacy that we inherited. This government will address that.
The member mentioned that we have doubled the debt. I think he had better recall who created the debt. It is now the interest on that previous debt with which we are burdened.
We took over government with a $16 billion a year deficit. The government will now have a $9 billion surplus. That is a $25 billion a year turnaround. It is this government that has done that. It is this government that will continue to make that surplus increase and, God help us, I hope we will in fact be able finally to overcome the scourge that was left to us in 1984.


The Acting Speaker (Mr. Paproski):: Before I recognize the hon. member for Saint Leonard, it is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjourn-
February 8, 1990

ment are as follows: the hon. member for Ottawa-Vani-er-Official Languages Act, the hon. member for Comox-Alberni-Justice, and the hon. member for Prince Albert-Churchill River-Telecommunications.


Alfonso Gagliano: Mr. Speaker, I want to take part in this debate on the motion introduced by my colleague because, as it happens, he is giving us an opportunity to continue our attack against the GST, particularly since the government lowered the boom on us last night. Quite naturally, I want to speak on behalf of the residents of Saint-Leonard, more especially in the name of the 15,000 citizens who signed a petition against this tax. This is the first time in the history of Saint-Leonard that 15,000 people went to the trouble of signing a petition to express their opposition to such a regressive tax system that our ill-at-ease government chose to cut off debate on last night.
Mr. Speaker, allow me to shed more light on the facts and make it easier for people to understand just what the government is up to. We have had just a few days' debate on this issue in the House, five or six I believe, and since the Minister of Finance unveiled his plan in June 1987 the government has steadfastly maintained that the tax is necessary to make Canadian companies really competitive with the rest of the world.
As a matter of fact, Mr. Speaker, the Committee on Finance-I deplore the absence of the Minister of Finance, but I am sure his officials are all ears right now-heard a spokesman for the Canadian Manufacturers' Association. And sure enough, he referred to the percentage, for we know very well that manufactured products or finished goods are not taxable.
So in the case of the tax, the famous, the bad, the terrible federal sales tax which is-to use the very words of the Minister of Finance-a killer of jobs and which went up from 8 to 13.5 per cent in four years, Mr. Speaker, barely 1 to 2 per cent showed up in the price of exported goods. We have to take a much closer look at this small percentage because the tax does not apply when you buy some equipment or raw materials. Nor does it apply to the work done by the employees, so all this led us to the conclusion that it was only a matter of a small percentage. But of course when the company bought a limousine for the president it had to pay the tax. As you might expect, Mr. Speaker, limousines will no
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longer be taxable under the new system, but the small ordinary Canadian worker who needs a compact car to go to work will pay that tax.

I am sure, Mr. Speaker, you would understand what I am saying. I know that the Minister of Labour says no. One day I will have to ask him some questions about the pre-retirement pensions with which we have some problems in Montreal. I will try him then.
I know you have been in this House for many years, Mr. Speaker, and you understand very well what I am saying. Imagine this. The executive of a large corporation will be able to buy his own executive desk tax free. It will cost nothing. But the poor Canadian who needs a bed to sleep on or a table in the kitchen from which to eat has to pay the 7 per cent tax. Is that fair? I am sure you agree it is not fair.
I could continue on. When the worker buys a sandwich, a lunch or a coffee at the canteen he has to pay the 7 per cent tax. But the executive who has a luxury kitchen in his luxury executive office pays nothing and he has his food prepared there, caviare and so on. That is why this tax is so unfair.
[Translation\
Do you know what GST means, Mr. Speaker?


An hon. member:: What does it mean?


Alfonso Gagliano: Good simple taxation. Tax people solely, Mr. Speaker, because all corporations have just been exempted. Not one Canadian corporation will pay the goods and services tax. Our tax system has just been changed, Mr. Speaker, in an underhanded way. So far, we have considered corporations as a legal entity, as a physical person. So why do you and I and your constituents and mine have to pay 7 per cent and corporations not pay a cent of this goods and services tax?
The other reason the government is proposing this goods and services tax system is simple, Mr. Speaker. Again, they are changing the nature of our tax system. So far, we paid taxes on goods; now, for the first time, we will have a tax on all services throughout the country. That is very important, Mr. Speaker. How can we have only five or six days of debate when our tax system is being radically changed, Mr. Speaker? I see the Minister of Labour laughing, but I do not know if his constituents will laugh too. He and I could have a debate in east-end

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Montreal on the goods and services tax and we would see who laughs last.
Mr. Speaker, it is very important. We are changing our tax system in Canada and the government does it like this: tax people solely and let the corporations off scot free. That is the reality, Mr. Speaker. Today, big corporations, on the pretext of being more competitive, can pay not a cent of tax and the Minister of Finance, who for the past five years has helped the rich get richer and the poor get poorer, is right in saying that there are not enough millionaires to tax in Canada. That is what he finds. He taxes everyone and comes up with a tax credit that he forgot to index. That is the reality.
Mr. Speaker, you were in this House as I was a few years ago when the Minister of Finance said that the tax system had to be reformed to make it simple, so that everyone could understand it. Yesterday and this afternoon, in question period, my colleague tried to make the minister understand that it will cost $14 million to explain this madness to Canadians.
It says here on page 8 of this GST brochure:
Sample cash journal pages
How a small business will account for this tax. Mr. Speaker, I am reading from this sample journal: "Date: March 2; Description: Antique bath & shower; $10,700.00 cash in. " Mr. Speaker, it is total confusion. Is this cash in an account receivable? The way the example is written there, it means that tax is collected, money is received and it is paid when the time comes. But if we look at what the legislation says about billing, even the Finance Minister does not know how a small business has to keep its books to understand it.
And later in this House, he had the courage to get up and tell us that there is an impact of the cash-flow change. On page 19, he gives us a ridiculous calculation showing a total benefit of $1,140. He did not at all consider the complexity of the accounting system needed for this crazy new system, which I call the nightmare of
the century, because it will really be very difficult to find one's way through it.
Mr. Speaker, you are indicating that I do not have much time left. Of course, this debate is not over even if the government imposed closure last night. Of course, this morning we read the comments from the Chairman of the Finance Committee who wants to pass this quickly, in three or four weeks-that is enough. But, Mr. Speaker, given the complexity of this legislation, how can we pass it so quickly?
So we shall come back to it. We shall debate it. We shall continue to explain to Canadians that this tax, the GST, applies only to people. It is not the Canadian way of doing things. I am sure that in the end, Canadians will understand and not be fooled by this government. Elections are coming up fast, Mr. Speaker, and be assured that if the government continues to maintain this tax, it will be defeated.


Mr. James:: Mr. Speaker, I have a question for my colleague. I am not going to run a long preamble because I see one of his own colleagues would like to ask a question.
This particular motion states in essence that the government should abandon the GST and bring forward in its place a comprehensive reform of the tax system that is fairer, simpler, integrated and taking into consideration all forms of taxation, and so on.
As I understand it, members of his party, including the hon. member for Gloucester, sat on the finance committee to review the GST and came back with a minority report which was a few pages long. It was not comprehensive. It seems to me there has been every opportunity for this member's party, the hon. member who proposed the motion and the member who just spoke, to develop a comprehensive reply or presentation as to what we should have. As I recall it his own party members who were on the finance committee last year were in agreement with the unanimous decision of the Standing Committee on Finance. They agreed that the FST was outdated and that a new tax regime should be instituted. When there is an opportunity to do so they don't do it. All they talk about now is doing it.
February 8, 1990

I think the member opposite may like to answer why they are saying one thing and doing another.


Alfonso Gagliano: Mr. Speaker, first, I would like to say to my hon. colleague that if he wants us to form the government we are ready to go to the other side. We will write our report and show him how to reform this tax law. If you are ready, come to this side and we will show you. If you are ready, let us do it right away starting this afternoon.
The hon. member referred to the Parliament before this one. I had the privilege of serving on the finance committee as a substitute member. We looked at the first stage of the Conservative tax reform. That is basically where the problem lies.
The members of this government were committed to full tax reform. Because there was a pending election they gave out some candies in order to get re-elected. That was the first phase.
Then they introduced the second phase, which is the GST. It is terrible. The people will not forget that for years and years to come. They will reject it in the next election.
What did we say then, Mr. Speaker? We said that, yes, we are for tax reform, but not the way they are doing it.
If you want to quote the words of my ex-colleagues in this House from the last Parliament, read the records and you will see exactly what was said. We said: "Yes, we are for tax reform".
This motion before us today makes a commitment to real tax reform. If you want to change places, we will go over there right away, this afternoon, and show you how to do it.


Mr. Corbeil:: Mr. Speaker, I simply wanted to inform the hon. member for Saint-Leonard (Mr. Gagliano) that when he was speaking, I was not laughing at what he was saying, because this is a very important subject, but I was laughing at his assumptions.
My question is this: How can he seriously explain to the people watching him on television, and I wish we could turn the cameras around so that we could see Canadians roaring at the inconsistencies in the explana-
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tions given by the hon. member for Saint-Leonard- how can he seriously say the GST will apply to purchases made by certain people but will not apply to purchases made by other people?


Alfonso Gagliano: Mr. Speaker, I will need some time to answer that one.


Don Boudria: Don't worry, take your time.


Alfonso Gagliano: A company that has to pay taxes is licensed under this new tax system. Companies pay the tax on their purchases, and before, what was paid was deducted. So the result is zero. That is why they don't pay taxes.
The individual, however, cannot deduct the tax. He doesn't have a credit. That's what I meant. So I hope the minister will take the time to read the bill and will be able to provide all the necessary information.


Don Boudria: Mr. Speaker, I want to ask a question of my colleague. I know that he was a member of the finance committee in the last Parliament and that he is also an accountant by profession.
My question is with regard to the discriminatory policy that the government has adopted in the GST whereby services offered by independent adjusters will be taxable under the GST while similar services provided by the insurance industry will not.
Insurance adjusters in my own constituency-and I have a letter in my hand signed by the the branch manager, Mr. Les Sazant, of the Underwriters Adjustment Bureau of Hawkesbury, Ontario-have informed me that if the minister proceeds with the bill as proposed now that it could very well mean that this business will be in serious trouble. Incidentally, the finance committee recommended that it be given an exemption so that it would be treated in a way that is similar-


Mr. Soetens:: Are you endorsing the finance committee's report?


Don Boudria: That is an excellent question that our colleague asks. The finance committee recommended that a few injustices be corrected. Notwithstanding the fact that I reject the bill, if it does go ahead it seems to me the very least that could be done is to correct some of those injustices that make my constituents lose their jobs.

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It is for that reason I bring this to the attention of the House. I think it is a very serious matter. I want to ask my colleague what he thinks of that discriminatory policy which I have just described.


Alfonso Gagliano: Mr. Speaker, I thank my colleague for the question. The GST is very complicated. That is why some people feel discriminated against and and others feel confused. You might find yourself in a situation where you are tax exempt but, because of the system, the product you sell might not be taxable so you do not have to charge the tax, but you will have to pay the tax on all other services or you do not get your credit. So people feel discriminated against.
There might be other cases where you do not charge the tax but you can get the credit. lit other cases, you might not charge the tax nor pay the tax. It is so complicated. Yet this minister and this government was supposed to bring in a system which everybody would understand.
Remember, a muffin can be taxable or not taxable. A muffin is a muffin. But if you go to a store and say: "I want a muffin". Then you say: "Would you put it in the microwave to warm it up?" It then becomes taxable. That is why I do not see how small businesses, most of which are in the food and retail business, can cope with the nonsense that this system is proposing.


Nelson Andrew Riis: Mr. Speaker, I have listened with interest to my hon. friend. He gave the impression very clearly that he opposed this tax. Just to make the record perfectly clear, we in the New Democratic Party, no matter what the outcome of the next election, we oppose this tax. If we were to form the Government of Canada, we would oppose this tax. We would not proceed with this tax. We would reject the tax. We would undo the tax and go back to some decent tax reform.
As my hon. friend from Esquimalt-Juan-de-Fuca said, I respect the Conservatives because they like this idea of a tax that will assist the privileged. They make no bones about it. They bring it in and say: "This is what we are going to do". They are very up front about it. I have to respect that level of frankness.
As well the New Democrats are saying: "We oppose this tax completely in principle, totally, in every way, shape or form". I do not know how much clearer one could say that.
I am going to provide an opportunity for my hon. friend from the Liberal party to speak on behalf of the Liberal Party of Canada to try to give a simple yes or no or not much more elaboration beyond that to this question. Is the Liberal Party of Canada completely and totally opposed to this tax in principle?


Alfonso Gagliano: Mr. Speaker, I thank my colleague because I see that already he sees us in government. I hope we will be very soon. If the hon. member convinces the Conservative government to call an election right away, we are ready. We have a plan. If an election is called right away, we will tell Canadians what we are going to do.
This government told Canadians that it would implement such a tax, and it did. We are going to oppose it, and we are opposed to it. When we get to the other Side-


Some hon. members:: Oh, oh!


The Acting Speaker (Mr. Paproski):: Questions and comments are now terminated.
Resuming debate with the hon. member for Winnipeg North.


Mr. Rey Pagtakhan (Winnipeg North):: Mr. Speaker, the Conservative government is unable to properly manage the economy, witness the growing deficit. Thus it is trying to place its responsibility for fiscal ineptitude on to Canadians. One method of doing this is through the levying of the goods and services tax.
Before I proceed further, over the last few days we have seen procedural tactics by members on my left that, in the eyes of many Canadians, were totally meaningless because time was wasted. Early this morning we witnessed the government's unreasonable closure on second reading of this bill, which cut off the opportunity for we members of Parliament to debate. The Liberal party, the Official Opposition, is neither to the left nor to the right. We stand for debate and for the well-being of all Canadians.
The opposition motion reads:
That this House call upon the Government to abandon its ill-conceived goods and services tax scheme and to bring forward in its place a comprehensive reform of the tax system that is fairer, simpler, integrated, taking into consideration all forms of taxation and the needs and practices of other levels of government and that this be clearly visible to the taxpayers and designed in a manner that does not
February 8, 1990

merely, under the guise of reform, constitute another increase in the
overall burden of taxation.
This motion reflects the Liberal commitment to kill the GST, while at the same time recognizing the need for tax reform. We have identified the principles that should guide this tax reform. There ought to be federal-provincial co-operation and, when this is done, we will have, as always, the well-being of all Canadians at the core of this reform. The need for tax reform is in fact very timely, particularly in light of the proposed GST which has been given an 80 per cent disapproval rating by the public. This is an indication of Canadians' distrust of this government and, in a real sense, of the alienation of the governed from the government.
Do we need a reform? Almost half of our national income is transferred to the government by way of taxes. Taxation has increased over the last five years at a distressingly high rate.
I submit that Canadians, indeed, have a good deal of common sense. Thus we understand the purpose of taxes. We appreciate that we will pay taxes. In fact we accept that it is a necessity. But there are limits to acceptance.
When taxes are too much, when there is unequal sharing of the tax burden, when the tax system is complex and cannot be understood, and if there is misuse of the taxes collected, then Canadians rebel.
There are many forms of taxation: property or wealth, customs or excise, payroll, personal, corporate and sales taxes. But this afternoon I would focus on the need for tax reform in the context of the proposed GST. We would like to replace something that is awfully bad, that is, the manufacturers' sales tax. This tax is hidden, has increased rapidly and does not allow our domestic producers to compete effectively with foreigners.
First, let us examine the foundations, the principles that should govern tax reform. As I have indicated, we on this side of the House have identified two sound economic principles. One, there must be efficiency. We must not unduly interfere with the allocation of resources, both capital and labour.
Two, it ought to be simple. It must be understood by all. We should not need tax advisers who must be paid. In fact, the law itself should be enforceable with a minimum of litigation.
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The second set of guiding principles would be that any tax system, or any taxation that we introduce as we reform the system, has to meet the accepted Canadian social values of fairness. That tax system would have taxpayers in similar circumstances pay similar amounts. Also, the ability to pay is taken into account so that it would allow a more equitable distribution of wealth and income.
The government seems to ignore the fact that there are other alternatives to the GST. The government has created a fiction by saying that it had no choice but to introduce the GST. The government has not even told us how many alternatives it has examined. Yet it has the resources of the Department of Finance to study many alternatives.
I do not have the opportunity to discuss a lot of them in depth. One that has been proposed is a single tax alternative which would be simple: lower taxes for most, share the tax load more fairly, eliminate loopholes and reduce administrative costs.
Let us continue to debate, but let us not insist on this GST.
There have been many other suggestions for reform, including the harmonization of the federal and provincial tax systems. This government has failed to do that.
Let me examine the GST itself. It will deal a devastating and crippling karate blow to our economy. It will be a fuel for recession and a fuel for inflation, both of which will result in a ruined economy.
When the goods and services tax is introduced, it will hit the pocketbooks of all Canadians. In fact, it has been estimated that it will be some fourfold. That will lead to a higher cost of living. Draining the power of consumers to buy will alter their spending pattern which will, of course, lead to a drop in the sales of manufacturers. As a consequence, there will be a steadily increasing cost of business. Operating costs will increase, workers will be laid off, the economy will slow down and a recession will happen.
When workers are hurt they have less buying power. They will demand higher wages, naturally and rightly so, to compensate for the ill effects, something which will trigger inflation. When the two are combined you will have a ruined economy.

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The government's brochure states that this GST has been designed to reduce the deficit. Yet the government has claimed it will be revenue neutral. I cannot follow the logic. If it were revenue neutral, cancelling the GST should have no negative impact on the deficit. That, incidentally, is also the opinion of The Financial Post.
There will be many ill effects on the health programs of our country when some of the services of health care workers like psychologists are taxed. You can see the danger of these services not being accessible to Canadians. When the administrative costs of our health care institutions are increased, you can see the burden added to our health care system. When we realize that transfer payments have not kept up with inflation then you have double jeopardy.
The effect on education will be similarly adverse to administrative costs. We cannot attract good teachers to our faculties. When the equipment becomes obsolete, we cannot replace it quickly. We will then suffer in our ability to compete internationally, since our ability to do research and development will be hampered. Science in Canada may be relegated to kindergarten level.
Can we believe the government when it says that the tax it intends to impose will remain at 7 per cent?
Let me tell you the history of the GST. New Zealand introduced the tax at 10 per cent, and now it is 12.5 per cent. The government could argue that is not a large increase. In Austria, it came in at 8 per cent, and now it is 20 per cent. In Britain, it was introduced at 10 per cent, now it is 15 per cent. In Denmark, it was 10 per cent, now it is 22 per cent. In Ireland, it was 16 per cent, now it is 25 per cent. In the Netherlands, it was 12 per cent, now it is 20 per cent.
Can the government fool Canadians that it will be 7 per cent forever? I dare the government to tell the truth. If we do not defeat this tax, there is a possibility of a tax revolt, but I hope it does not happen.
I would like to quote from a financial columnist who wrote on February 6, 1990: "If we have a choice between two taxes, which raise identical sums of money, both of which are perceived to be bad, why should we hope for the tax which affects most people directly?" Is GST
better for the government? The answer is yes. Is GST good for Canadians? Eighty per cent of Canadians say no.
In last night's debate, one member of the government side said: "We were sent here to Ottawa to be tough", as though it was a source of pride. My submission this afternoon is that we have been sent here by our constituents to be sensitive, caring, fair and honest. Let us achieve genuine tax reform, acceptable to the constituents of Winnipeg North and acceptable to all Canadians. When that happens, we will be truly Canadians.


Gregory Francis Thompson: Mr. Speaker, I want to go back to a quotation that I have used in this House before. It is one by a John Baptiste Colbert, a 17th century statesman and finance minister during the time of Louis XIV. What he said at that time was: "The art of taxation consists of plucking the goose so as to obtain the most feathers with the least hissing."
I still go back to my perception of the goods and services tax. In response to the member for Winnipeg North, a great deal of this hissing is because they have never attempted to help the Canadian people understand this tax. They are using the same kind of rhetoric that they have used for years in relation to taxation.
Let me go back to the election of 1980, 10 years ago exactly to the day. We were in the midst of an election campaign because the Liberal party could not come to grips with reality. We were forced to go out and sell a 16-cent a gallon tax increase on gasoline. They fought against it, yet they knew at that particular time that it was good for the country. They chose to ignore it and they are doing the same thing with the GST.
What I want to ask the hon. member is this. The Liberal party is in the midst of a leadership campaign. Some of their candidates have taken positions on the GST and explained what they will do after they do win the leadership of the party. Regrettably, if they did ever form a government, some of them have told us exactly what they would do in relation to that tax; keep it, reject it, change it, whatever.
I am going to ask them this. I think the NDP is exactly right; the Liberals would not change it. They want to stand up and they want to holler but they will not change it. Is the hon. member going to take this into consideration in his support for some of these candidates who are
February 8, 1990

seeking the leadership, and ultimately, the prime ministership of this country?


Rey D. Pagtakhan: The answer is simple, Mr. Speaker. I will recommend to our leadership that the GST be scrapped.


Brian L. Gardiner: Mr. Speaker, I appreciate the comments by the member for Winnipeg North and I think the member for Esquimalt-Juan de Fuca summed it up very clearly when he said that we get mixed signals from the Liberal party as to exactly where they stand on the goods and services tax. I think the Liberal Party is shilly-shallying in trying to tell Canadians that they are against the tax. In reality, we all know-as all Canadians know who are watching this debate today-that the Liberals have no intention whatsoever of asking their leadership candidates to oppose the GST. I agree with the hon. member who spoke just a few moments ago, heaven forbid if the Liberal Party ever formed a government again in this country.
The only hope is the NDP, as the hon. member for Esquimalt-Juan de Fuca says. I would like to ask the member if he will join with us in rejecting completely Bill C-62, the goods and services tax. Will the Liberals make a commitment to the New Democrats in committee that they will stand and reject completely that bill, no tinkering, no fooling around, no technical amendment, just reject the bill completely?


Rey D. Pagtakhan: Mr. Speaker, today he will be happy. You can join us and reject this GST. But Liberals are reasonable people. Three years down the road we do not know what the GST will have done to the Canadian public and we might devise a much better alternative than you predict, because you know that you cannot form the government.


Mr. Bill Kempling (Parliamentary Secretary to Minister of Employment and Immigration):: Mr. Speaker, in this motion the opposition calls upon the government to produce a tax that is clearly visible to taxpayers. That is precisely our intention in the goods and service tax. It is clear, it is straightforward and it is up front.
In fact, this is also how the government has conducted itself on this issue. We have gone to great lengths to inform the country about this measure and we will continue to do so in the period ahead. In the last few days, we heard a great hue and cry about our honest and open efforts to inform every business person in every
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region of this country about their rights and obligations under this proposed legislation.
Anybody who walked through the Confederation Building before we left for the Christmas recess could have seen the huge crates of Householders. On the front of them was printed in large black letters "Stop the GST". These were by the opposition members. In fact, I am amazed that they would have the nerve to stand in this House and try to stop us from putting out information on the GST, because what they are saying is "Let us, the opposition, put out bad information, in most cases, on the GST. But you, the government, can't put any information out. If you do, we are going to rise on questions of privilege in the House of Commons". That is the most two-faced, double-dealing effort I have ever seen and that is exactly how they have operated in the last little while.
If we cannot inform the public and businessmen, what are we supposed to do? Suddenly we appear in January, on New Year's Day, 1991 and say, "Surprise, what do you think? You have a new tax. Now you are going to take a year to figure it out". We are not doing it that way.
My colleague, the chairman of the finance committee has not hidden himself away. It would be a hard job to do anyway. There were public hearings across the country.
The Minister of Finance, the Prime Minister and others on this side of the House have spoken at many public meetings about this measure and will continue to do so. In fact, I have heard challenges from the other side about getting on a platform and debating the GST. I will go anywhere, any time, with anybody, to debate the GST. Because I know how it operates. I know how the present system operates. I know how bad it is. I know people who have been hurt by it and I will go anywhere and debate it.
In fact, few measures have attracted the attention that this legislation has. Unlike some opposition members, Canadians in every part of the country have contributed to make sure that the goods and service tax is straightforward, fair and as effective as possible. By their wilful obstruction and stalling tactics in this House, the opposition has thrown away an opportunity to make a meaningful contribution during this debate. They have turned their backs on the process, and in doing so they have turned their backs on the people they were elected to represent. They want to send out a bulletin that says, stop the GST but I am not going to tell you what it is all

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about. That is the sort of phoney approach they take to it.
We came into this parliamentary session fully prepared to debate the opposition on the worth and substance of this legislation. They have proven unwilling or perhaps unable to do so. We know that the Liberal Party is distracted because of its struggle to find a new leader. The new leader of the NDP is distracted because she is struggling to find herself. She cannot find herself in that dark socialist closet. Unfortunately, Canadians may never know what a difference an effective, responsible opposition could have made to this legislation.


An hon. member:: Keep your tie in.


William James Kempling: However, I always keep my tie inside my jacket especially when I am speaking and I keep my jacket buttoned up. I want to find a tie just like this for him. If I can get a red or orange one I will do that.


Brian L. Gardiner: Mr. Speaker, I believe the rules of the House state that a member is not allowed to use an object for display. I am interested in what your ruling is on the member's time.


The Acting Speaker (Mr. Paproski):: I do not think that is a point of order. I haven't seen his tie and I don't care to see it.


William James Kempling: However, Mr. Speaker, Canadians will indeed know that they are paying a goods and service tax.


Mr. Speaker:: The hon. member for Essex-Windsor on a point of order.


Mr. Langdon:: Mr. Speaker, I think I have quite a legitimate point of order. I believe that when a member refers to a printed document he or she is required to table that printed document in the House. I heard a reference to a tie, which I understand is a printed document, and it seems to be quite clear that the rules of the House require-


Mr. Speaker:: It has to do with cabinet ministers but it does not have anything to do with private members.


William James Kempling: As I was saying, Canadians will know that they are paying a goods and service tax. We don't expect them to enjoy doing so but the GST will be visible
and paid by consumers at the retail level. The part I cannot understand is that the opposition want this tax to remain invisible. They do not really understand what happens when the tax is invisible. I do not think any of them have been involved. I am not saying this in any derogatory sense. They have not been involved in the business side of structuring a price. What do you think happens when the federal sales tax is increased under the present regime? What do you think happens? There is a windfall to any merchant or any wholesaler who has tax-paid inventory in his warehouse. There is a windfall to him. He feels justified because he says, I have to go to the bank and borrow the money to pay the government the tax. He says I have to go to the bank to borrow the money to pay the federal sales tax to the government. Canadians in every region of the country who pay this hidden tax every day are going to be able to see the new tax up front. They pay about $18 billion in federal sales tax and many of them do not even know they have paid it. If members of the Liberal Party who are barracking over there had been here this morning they would have heard my friend, the member for Esquimalt-Juan de Fuca, challenge the Liberals as to whether or not they would cancel the GST if, unfortunately, they ever came to power. He nailed them right to the wall. They fumbled, mumbled, gasped, and choked and they did not have an answer. All they could say was that they would go back to the drawing board, as they have said for 40 years, 40 years of the same hidden tax with all the warts and problems it has.
I spoke on this yesterday. This morning I had a call at my office from someone who works in National Revenue in the federal sales tax division. He was very unhappy about some of the things I had said. He would not leave his name nor his phone number. I hope he is watching now, because a lot of those guys who were sales tax auditors when they left the government service became sales tax consultants. They went around to little businessmen in this country, the guys they were dunning for sales tax who should not have been dunned, and said that they could show them how to save all kinds of money because they are now sales tax consultants. I hope that guy is watching. Maybe he will call me and I will have a good long conversation with him.
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Mr. Lee:: Mr. Speaker, I could not help but respond to remarks of the member for Burlington on the GST. I have been reviewing some correspondence that I have received recently from constituents and I would have to acknowledge that the tax reform manifested by the GST proposal is destined to bring about what the economists call allocative efficiency, but it is really so marginal that most of us in the real world are not going to be able to understand it or pay much attention to it.
One constituent has written to ask me to consider the leasing of automobiles. He says we will be paying 7 per cent on the 13.5 per cent federal tax which has already been charged on the automobile unit, 7 per cent on the $100 air conditioning excise tax, which has already been paid, 7 per cent on the $25 provincial tire tax, 7 per cent on the $600 minimum gas guzzler tax, and 7 per cent on the 8 per cent provincial sales tax in Ontario. That is very, very confusing for a consumer. My comment is that the government is replacing a bad tax, an efficient tax, the MST, with an equally bad or worse tax that will impact not just on manufacturers but on every single consumer in Canadian society. That bad tax is now made 100 times worse because it impacts on 100 times more Canadians. That is what the taxpayers out there do not understand.


William James Kempling: Mr. Speaker, there is a pamphlet on leasing which I would encourage the member to send to his constituent. It all depends on when the vehicle was leased. If it was leased at a certain date there are different provisions from those which would apply if he has had it for a long while. At any rate, we have worked with the leasing companies very closely and I think we have a system now that they believe is fair to the people who are leasing vehicles. If a business is leasing the vehicle, any of the charges the business pays may be rebated. I do not think it is all that bad. I know there is a grey area with respect to the date the vehicle is leased; I would not deny that. But I would urge the member to see that pamphlet. We have some of them in our lounge. If he wants one, I will send it over. I suggest that he go through it carefully because it is not our intention to put any extra burden on anybody who is leasing a motor vehicle. I have leased hundreds of them myself over a period of time and I know the ins and outs of it. I would not be that concerned. But if you get that pamphlet, I think you will understand it.
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Gregory Francis Thompson: Mr. Speaker, I want to comment on the dialogue between the two members opposite. I think that is constructive. We just pointed out that some meaningful discussion and understanding can take place when the dialogue is on the level it has been on in the last two situations.
I want to point out to the Parliamentary Secretary that we collect the manufacturers' sales tax, I believe, from only 75,000 sources. In those 75,000 sources, there are something like 22,000 special exemptions and categories. I was wondering if the Parliamentary Secretary could answer that.
I am also interested to know whether he could point out why we are at a disadvantage in this country in relation to imported goods versus domestic goods, all things being equal. I was wondering if the Parliamentary Secretary could point out to us how discriminatory our present manufacturers' sales tax is.


William James Kempling: I will be as brief as I can. There are 75,000 people involved in paying the manufacturers' sales tax today. There are 22,000 different arrangements with them and there are six different rates, not four, as we have been told.
I will be specific on how it affects manufacturers. In my riding we have the Hoover Manufacturing Company. They made a little washer and dryer that my friend from Esquimalt-Juan de Fuca would buy for his family or a friend. They imported some component parts and they manufactured it here. When they put their price together, they had to include their overhead, sales cost, telephone costs, packaging costs, shipping costs and everything else. When they compared this with a Sanyo that was imported from Japan, there was a $95 difference at the retail level. This is because the Sanyo comes in and a price is set on it, FOB a certain point in Canada. When the consumer buys this washer and dryer he would see this $95 difference and say: "No way am I going to buy the Hoover product". So, what did Hoover do? They moved the production out of Canada into the United States so they could be on a level field with the Japanese. That is what has actually happened. It has happened with all kinds of products across this country. In the United States, there is a group of people called custom manufacturers who just manufacture for Canadian mass merchandisers. That is all they do. They do not sell in the United States, so they do not even have to abide by the

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dumping legislation. This is something this goods and services tax will overcome.


The Acting Speaker (Mr. Paproski):: I think I will have to cany on. There will be another opportunity. The hon. member for Fredericton-York-Sunbury has the floor.


Mr.   J.W. Bud Bird@Fredericton-York-Sunbury: Mr. Speaker, one of the things that really amazes me this afternoon is that the official opposition that sponsored this motion and scheduled this whole day of debate on a very significant program like the goods and services tax has hardly shown up for the game. There are no members present on their front benches.


The Acting Speaker (Mr. Paproski):: The hon. member knows, because he was also a long time provincial member, that you do not mention who is and who is not in this Chamber.
wordy as it is, and as stale as it is, at least it is different from the traditional comment that he, his leader and his party have been delivering over the past many weeks and I quote: "Let us take this tax back to the drawing-board."
I gather that the paragraph presented today in this motion is the Liberal Party's redesign and it is hardly a work of architectural excellence. In fact, it is a work that almost departs entirely from accuracy and the truth and substance of the goods and services program.
The pivotal call in this motion is that we abandon the goods and services tax program. The word "abandon" is the type of word that suggests loss, fear, and flight, and it has been the hallmark of a great deal of this debate with members standing and speaking about assumptions of doom and gloom and all of the things that this tax program may bring.


Mr. Bird:: I stand corrected on that point. I must say I am sorry that some of my hon. colleagues across the House are not here to more vigorously debate this motion this afternoon.
I would also like to say that this is the second occasion in two days that I have had the opportunity to speak on this goods and services tax program. It is one I have deliberately sought, because I sincerely believe in the importance and quality of the legislation which constitutes the goods and services program.
I believe it is the right kind of legislation, the right kind of tax reform for Canada. Because I come from a business background, I have some sense of feeling for what financial pressures are about. My experience tells me that over the past 25 years our country has been proceeding in directions that had it been a business it would have been virtually insolvent.
I have an appreciation for the type of financial responsibility which we have to demonstrate in the years ahead, the type which would enable us to pay our way, to live within our means, and not to spend years in search of the myth of prosperity which really results in hyperinflation and the economic chaos that goes with it.
I would like to commend the hon. members of the opposition, particularly my hon. friend from Tracadie who introduced this motion this morning, and say that as
I think Canadians are tired of politicians who cannot bring themselves to support good government legislation simply because of partisan pressures. When they ask us to abandon this tax program they are asking us to forsake our responsibility to Canadians and to their economic future. They are asking us to ignore the deadly deficit which we have seen year after year for almost 25 years and the deepening debt which is now standing at $320 billion and growing.
This motion also contains another sort of moral insolvency in the sense that it blatantly betrays how little the opposition really cares for the millions of Canadians, those on low and modest incomes including many senior citizens and single parents who will be better off under the goods and services tax program.
It is a fact that has been consistently ignored. Families making less than $30,000 income will have a net improvement in their financial and economic circumstances as a result of this goods and services program. These are the people that the opposition would have us abandon. When they say abandon the tax they mean abandon a fairer tax system, one that shifts the burden from those who cannot pay to those of us who can, to abandon a tax system that will let Canadian made products compete on equal terms with imports. Keeping a 13.5 per cent extinct federal sales tax will penalize domestic production as it has for years gone by.

February 8, 1990

They ask us to abandon a tax system that will strengthen imports and diminish our export capability. The GST will ultimately provide an economic boost to this nation, estimated to be close to $9 billion. They ask us to abandon a tax system that will help business to invest in new technology and productive capability and to create new jobs. As I said yesterday, the credit alone to businesses at the end of this year on existing inventories will constitute a $2 billion cash flow improvement to business accounts in this country.
These calls for abandonment of this tax are callous and contemptuous messages. They are calls to abandon our responsibilities. They are calls that we will not heed. That is not the policy of this government.
This motion talks about the tax scheme being ill-conceived. What could be more ill-conceived than the stale expression: "back to the drawing-board". There are no alternatives or suggestions, but back to the drawing-board, and then a resolution that is as negative and as preposterous as this which has been presented to us today.
They ask us to abandon the goods and services tax program. They are asking us to ignore the challenges which Canada faces in a world market-place that is increasingly more competitive on a global basis. The message that royal commission after royal commission, study after study, expert after expert, has driven home to Canadians is that the current manufacturer's tax is extinct, it is a bad tax, and it must be replaced.
This is a progressive tax. The goods and services tax is not a regressive program at all, it is a progressive program. It is one that to any fair and reasonable mind would be seen as a very positive and constructive direction for Canada.
Canada exports one-third of our Gross National Product, representing millions of workers. For example, our pulp and paper exports are $20 billion out of a total production of $25 billion. This tax program will enhance that industry.
This government will not be abandoning its responsibilities. It is the opposition members who should be abandoning their concepts which date back to 1924, and they should be abandoning the fearmongering which has characterized their debate.
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The most interesting aspect of this entire debate today is that the Liberal opposition, as devoid as it has been of alternatives and creative suggestions in this debate, has actually been ridiculed and laughed at by the socialists to its left. That, to me, is the real interesting highlight of this entire debate. Not only is the opposition across the way divided, but the NDP are ridiculing the Liberals.
Canadians are seeing the government supporting this goods and services tax program with confidence and conviction, based on the knowledge that we are doing the right thing for Canada and that the Canadians will be well served.
The goods and services tax is one that will meet Canada's needs into the 1990s and into the 21st century. These are goals we cannot abandon, and they are goals we will not betray.


The Acting Speaker (Mr. Paproski):: Questions or comments. The hon. member for Okanagan-Shuswap.


Lyle Dean MacWilliam: Mr. Speaker, we have heard time and time again in this assembly members on the government side saying that there have been no alternatives offered, that they have no alternative except to impose this massive, Draconian tax measure.
I want to point out very clearly to everyone in this House, as well as people right across Canada that time and time again my colleagues in the New Democratic Party have posed many alternatives. It is just that members across the floor have simply not listened to them.
What about the concept of a 20 per cent minimum corporate tax? What about the concept of lowering the interest rate and reducing the government debt as a result of increased productivity and lowering costs of borrowing? What about reclaiming the billions and billions of dollars in deferred taxes that have sifted through the government's hands because it has not claimed the money due and owing to it from those large profitable corporations, over 89,000 of which in 1986 paid no taxes whatsoever on $22 billion in combined profits? Why not go after some of that money? What about an assessment on corporate polluters with an environmental tax assessment? There are four alternatives right there, four good alternatives that this government, I submit, has simply refused to accept.

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John Williston (Bud) Bird: Mr. Speaker, the socialist representatives of the New Democratic Party have proposed tax measures that, thank goodness, they know they will never have the opportunity to implement. They know that they are unworkable. They know that the 20 per cent basic tax on all corporations will inhibit growth and initiative.


Lyle Dean MacWilliam: They did it in the United States.


John Williston (Bud) Bird: I give the New Democratic Party credit for their socialistic suggestions, Mr. Speaker, but they know that they will never have to implement them.


The Acting Speaker (Mr. Paproski):: I think that everybody has caught their second wind since early this morning. Questions and comments are now terminated.


Shirley Maheu: Mr. Speaker, I rise to address a bill that deals with fundamental fairness and equity. The Conservative government's goods and services tax will hurt all Canadians, especially those on the lower end of the economic spectrum. It is clear that the GST must be withdrawn.


John Williston (Bud) Bird: That is not true.


Shirley Maheu: It certainly is true.


Donald Alex Blenkarn: That's not true.


Shirley Maheu: The Prime Minister and the Minister of Finance must begin a process of actively consulting Canadians and provincial governments. They must create an integrated and fair taxation system. The government cannot fool Canadians by simply lowering the rate of the tax from 9 to 7 per cent.


An hon. member:: One of your suggestions.


The Acting Speaker (Mr. Paproski):: Hon. members, please. There is still an hour or so to go. I would appreciate listening to the hon. member. The hon. member for St. Laurent-Cartierville has the floor on debate.


Shirley Maheu: When the opposition starts screaming, it means we have really got them worried.
We will not accept a tax that is still fundamentally flawed.

Even if it reduces the rate from 9 to 7 per cent, the government cannot expect Canadians to accept the tax without protest.
It is imperative that the federal government further consult with the provincial governments, in order to create an integrated and fair tax system.
At a time of economic restraint, when the Governor of the Bank of Canada is keeping interest rates at artificially high levels in order to fight inflation, our minister introduces legislation that may raise interest rates even more.

If we look back to when the government first proposed the goods and services tax, they said that it would be visible. We have been talking a lot about visibility today. They said that every Canadian would be able to see the tax when paying for an item or a service. Unfortunately for Canadians, this government has reneged on another promise. The problem is that this government has a remarkable tendency to raise taxes.
If we look at the old manufacturers' sales tax, we see that when the Conservatives first came to power, the tax was approximately 9 per cent. Now this tax has climbed to a level of 13.5 per cent after four increases.
Can Canadians really trust this Government to keep this tax at a relatively low level? I doubt it. They were not able to keep their hands off the old tax.
It will simply be a matter of time before the Minister of Finance increases this tax back to 9 per cent and heaven knows how high he will raise it after that.

Apparently, the present government would like to reduce the debt by raising taxes and eliminating social programs. The federal government must find ways to manage our country's resources far more effectively. We cannot let remote regions and the poor in this country pay the price of the Conservative Government's poor fiscal management.
As a government that professes to favour tax reform, the Conservatives have failed miserably.
February 8, 1990



Another promise that the government made with respect to the proposed goods and service tax was the fact that it would be revenue neutral. Well, it is obvious that the Conservatives are using the GST as one of their main instruments in the battle against the deficit. Instead of being effective economic managers, they are using the bluntest instrument possible, increased taxation.
The Minister of Finance will say that he has been brave in his cutting of government expenditure. His definition of bravery includes attacking the unemployed, withdrawing the Citizenship Instruction and Language Training agreements which helped new immigrants adjust to Canadian society, and closing down the cafeteria in one of the Parliamentary Buildings. Some hero! What kind of minister would engage in this type of action? It is very clear that fairness is not a word in the minister's vocabulary.
As the "Axe the Thx" movement has been saying, the administration of this tax will be a nightmare for small businesses throughout Canada. Canada will have the dubious distinction of being the only country in the world with a two-tier tax system. So much for this government's promise to keep the tax system simple.

It is estimated that the GST, the tax on people, will cost small retailers who will have to hire additional staff, including accountants, to deal with their new administrative chores, $2 billion annually. What is particularly disturbing about these additional costs is that most of this burden will be borne by very small businesses. It will be a nightmare for small businesses because the federal government is determined to impose the GST without the co-operation of the provinces. We will have a two-tier sales tax, since small businesses will have to apply both the provincial retail sales tax and the federal government's GST. Although the Conservatives claim they are trying to simplify the tax system, it is quite obvious that the GST, in its present form, will make it even more complex.
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Another fundamental flaw is the fact that the GST will have a disproportionately negative effect on low-income Canadians, including senior citizens and people on welfare. People over 65 in my riding who live on pensions already have a hard time making ends meet. They do not have the means to pay for an automatic 7 per cent increase on the necessities of life. Is it fair for them to pay tax on clothing and on certain food items? We do not tax caviare, we just tax our seniors.

On a more personal note, I know a woman in my riding who can only afford one evening out a month. She will soon be housebound because she cannot afford to pay the 7 per cent tax the government intends to impose on practically all her purchases. This tax penalizes business people, but this woman is also very clearly penalized. These are people on small budgets who can afford very few extras, such as going to the movies or to a restaurant.

Many individuals who testified before the finance committee stated that proposed tax credits to low income earners would not be enough to compensate for the negative effects of the tax. The tax will be particularly difficult on seniors. The president of the One Voice Seniors' Network stated before the committee that the proposed tax credits are not reassuring. Seniors, many of whom are on fixed incomes, will still have to pay proportionately more of their income than richer Canadians.
A further flaw in the tax is the fact that the credits are not fully indexed to inflation. Therefore, as the years progress, what little protection individuals on fixed incomes had would be severely weakened. According to the National Council on Welfare, within five years 700,000 poor families would be cut off from the tax credit because of the absence of full indexation. Within 10 years, this number would rise to one million families.

As a former city counsellor and a former mayor, you will understand that. I would like to refer to the impact of this bill on the other levels of government. At a time when municipal budgets are drained by deteriorating infrastructure while collapsing under the increased burden of having to supply a variety of services and improve environment management, this Tory Government is

February 8, 1990
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giving them and the provinces the additional responsibility of managing our national debt.
Municipalities have to use a multiplicity of services in order to offer their citizens a range of programs. With the GST, it is clear their operating costs will rise, with the result that services will have to be reduced or even eliminated or taxes increased in order to maintain some quality of life.
In fact, Canadian taxpayers will pay this tax three times. They will pay it when they buy a good or service. They will pay it again when municipal taxes and provincial taxes are increased. Each time the municipal government buys a pencil, the tax will automatically be transferee! to the taxpayers.
Is the Government in effect creating two societies, one made up of people who have the means to look for every possible tax loophole, and the other made up of people who have always to think twice before buying their daily necessities because of their tight budget? Culture for the former, TV for the latter.
If we refer to the report on the tax impact of the GST, provinces suggest the tax would seriously jeopardize their financial situation.

While medical services are exempt from this tax, psychological services will be subject to taxation. This is simply an unfair assessment of the need of psychological services and the inherent benefits they have for patients. To exclude these professional health-related services from the umbrella of related medical services shows this government's insensitivity toward mental health issues.

In conclusion, I believe the time has come to balance things. The Government should tax fairly and stop favouring large corporations and very high income people. It is not reasonable that the same ones have to pay all the time, the poor, low income people, senior citizens on fixed incomes. It is unacceptable that this tax be implemented as proposed as early as 1991.


John Williston (Bud) Bird: Mr. Speaker, we have reviewed with interest the Hon. Member's speech, and I have three questions.

First, I would like to ask the hon. member if she believes the representation which is contained in a study by Peat Marwick Thome published on December 19 which states that a family of four with a single wage earner, making $24,000 or less, will receive a $580 tax credit per year in four quarterly cheques of $145 each. Does she believe that?
Second, I would like to ask the hon. member if she believes the representation made by the Department of Finance that families earning less than $30,000 per year will receive a net economic benefit as a result of the goods and services tax program, the total program, the elimination of the tax, the GST credit and so on.
Last, she has addressed low-income families. I would like to ask her if she agrees that the primary expenditures for low-income families are in the areas of basic groceries and rent for accommodation, both of which are tax exempt. Therefore, would those families not benefit from the goods and services tax exemption component as opposed to her claim that they will suffer increased expense?
I would like to have her answer to those three questions.


Shirley Maheu: I thank the member for the question. Have you ever been poor? Twenty-four thousand dollars a year for a family of four? It is quite obvious that you do not have to answer the question for me because you do not even know what poor is.
When we talk about poor families only buying the primary necessities like groceries, and then they have to pay the rent, we forget about the fact that they have to heat their houses and buy clothes for their children, plus the 7 per cent additional expenses. Toward the end of the week, we are not even letting them get away without a tax on a package of cookies for the kids. When they get home from school, cookies and milk are a thing of the past for the poor family because they will not be able to afford them.
It is very obvious that they do not understand what being poor in this country means.


Mrs. Tardif:: Mr. Speaker, I would like to return to the question just put by the Hon. Member for Fredericton- York-Sunbury and the answer to it. My hon. friend from Saint-Laurent-Cartierville probably reads Mon-
February 8, 1990

treal newspapers. I have here a clipping from the Montreal Le Devoir titled "An unavoidable reform". I would like to quote Albert Juneau, who had this to say in the last two paragraphs of that column: "There will be some gnashing of teeth here and there, but we will have to get used to it. The new sales tax on goods and services, the rules of which have been made public, will not please middle-and high-income families who will experience a significant increase in their tax burden. On the other hand, low-income families will be happy because they will be making real gains. As a result, in the face of increasing opposition to that new consumption tax, the Conservative Government, in order to obtain acceptance, chose to improve the situation of the neediest. This could not be done without increasing the tax burden on the most privileged and increasing revenues from the GST."
Mr. Speaker, when I look at the analyses that were made, not by people who simply reported the news but people who took the time to look at the whole issue, the general conclusion is first, that low-income Canadians will fare better and second, that, in all that was said since the technical document was tabled, there is no better alternative to the proposed GST, one that would reflect the disparities among our population, that would help to solve all the problems, one that would be a comprehensive proposal. I find it difficult to accept that people daily tell us the proposed GST will hurt the less privileged or senior citizens, when the exact opposite is true.
I also find it hard to understand that the tactic most often used in this House since the beginning of debate was that of petitions. I was listening last night to the news, after hearing the day before how important it was to the Liberal Party, the Opposition Party to put forward full cases of petitions. Last night, one of the leadership candidates said: "Listen now, it's so easy to make people sign petitions-all you have to say is: Look here, the tax will cost you money, a lot of money." One evening I see how important they view a petition, and the next evening they don't think much of it by the way they trick people into signing petitions. When I look at that I tell myself: How can that be taken seriously after all? Is there a will
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to help people, is there a way to consider legislation seriously, or do they talk simply for the fun of it?


Shirley Maheu: Mr. Speaker, we do not wish to be constructive, we just want to get rid of it. Could the hon. member explain to us why 78 per cent of Canadians are against the GST. Your own constituents- I probably got signatures from some of your own constituents, because I received them from all over Quebec.


The Acting Speaker (Mr. Paproski):: Questions and comments are now terminated.


Jesse Philip Flis: Mr. Speaker, I am very honoured to add my few words to the motion put forward by my party that this House call upon the government to abandon its ill-conceived goods and services tax scheme and to bring forward in its place a comprehensive reform of the tax system that is fair, simpler and integrated.
Over the last few months, my colleagues and I have tabled over 600,000 petitions bearing hundreds of thousands of signatures from Canadians right across the country who oppose this proposed goods and services tax. We have tabled petitions that oppose taxing everything from books and ballet classes to straight outright opposition to the GST.
I have been monitoring the petitions that I personally tabled. While looking through the government's response to the petitions, I was struck by the arrogance with which this government addresses very valid concerns of the Canadian public. The hon. members opposite know what I am referring to. We find in our desks about one month after tabling a petition a big brown envelope and inside is the response to petitions.
I want to do something that probably no other member has done in this House. I want to respond to this response to the petitions. The response to each petition, be it against the ballet lessons or the books, was identical. It it because of this that I think the response merits some serious attention and shows why we need serious reforms to our tax system.
First, we start off with the criticism of the current manufacturers' sales tax which, as we all know, was brought in at 9 per cent, and raised by this government to

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13.5 per cent. The Minister of Finance describes this tax as discriminatory and complex. If the MST is discriminatory, that is one positive aspect of this tax that the GST does not have in that the GST indiscriminately taxes right across the board, placing a higher and bigger burden of taxes on the poor working population of this country.
With respect to the current tax being complex, let me quote from one of this government's traditional allies, Mr. John Bulloch. In response to the streamlined accounting system proposed by the government to simplify the collection of taxes, he states that these procedures "are the most complex part of the whole nightmare".
He has also forwarded his estimate that it will cost approximately $1,500 to $2,000 for this collection versus the government's estimate of $600. The Minister of Finance states that the GST will improve our competitive position and provide a major stimulus to economic growth. Although the Minister of Finance may have in the past consulted with a broad spectrum of sectoral and public interest representatives, as claimed in this response, there are dire consequences expected for our economy resulting directly from the implementation of this new tax.
Wood-Gundy, the renowned Toronto investment firm that has also traditionally been an ally of this government, among others, has predicted that the GST would set off inflation at a rate much higher than estimated by the Minister of Finance. This would in turn set off spiralling wage demands which would lead to higher interest rates which would lead to higher unemployment.
We then come to paragraph three of this response in which the Minister of Finance describes the generous credit to low-income earners and claims that families earning under $30,000 a year will be fully protected once the GST is in place. That is a bunch of hogwash. The working poor are worse off than when this government took power five years ago, through the minister's insistence in the raising of sales tax. Furthermore, the small relief that may be felt in the first year will be eroded very quickly as the credit is indexed only to inflation of over 3 per cent and therefore the value of the credit is virtually guaranteed to erode by 3 per cent in a year.
A tax that did not even exist one year ago has suddenly become the only solution to all our social and economic woes. If the truth be known, the only reason that this government is sticking to its guns on the GST is because
it falls right into line with the government strategy of favouring corporations and the rich at the expense of the average Canadian.
According to the National Council of Welfare, since 1984 when this government came into power, income taxes for an average working poor family have risen by 44 per cent, while those of a typical top income family have dropped by 6 per cent. Yes, the average working poor family is paying 44 per cent more in income taxes, not including the direct effect of the increased sales tax, while the rich are paying 6 per cent less.
There is something wrong in our tax system when the collection of our revenues and the sharing of our resources leads to 378,000 people per month using food banks in Canada. This is based on Canadian Association of Food Bank figures. There is something wrong with our tax system when 151,000, or 40 per cent of the food recipients, are children under the age of 18. Children are twice as likely to need food assistance than adults. There is something wrong with our tax system when nationally on an annual basis it is estimated that 1.4 million different people, including 560,000 children, use food banks.
There are at least 1,100 emergency grocery programs and 400 meal programs either operated or supplied by food banks in Canada. Meal programs are estimated to serve 1.1 million meals per month. I have 11 food banks in my riding of Parkdale-High Park alone.
Sales taxes have become the answer to all of this government's revenue problems. Now we know why. At the expense of the majority of this country, this government is going to protect its rich friends. This is getting increasingly and frighteningly obvious. It does not take a genius to realize that $1 tax on an item is going to hurt the working poor much more than someone with an income of $100,000 or more.
In my riding of Parkdale-High Park, the average price of a house is $290,000. We already have a housing crisis. The GST will add another $9,200 to that price. That does not include the taxes on lawyer's fees, real estate, commission fees, lot levies, and so on. For the majority of my constituents who cannot even now afford a house, it will be virtually impossible in 1991. For those who do not have the money to buy, they will have to have the money to pay higher rents. The GST will affect new
February 8, 1990

dwellings and old, as it applies on all landlord operating costs.
For those of us who are making the decision to make any major purchases before 1991 to avoid the GST, do not worry. It will still get you every day, every month, every year.
In the fourth paragraph of the response to the petition comes the question of visibility. The response from the minister claims that because the GST will apply at the retail level and because it covers a broad base, consumers will know that they are paying the tax and how much they will be paying. This is the essence of visibility.
The Minister of Finance has already admitted that he does not have the legal authority to force businesses either to show the tax as a separate item on sales receipts or to display the tax on the shelf price. Why did the minister even bother to make this argument if visibility is already built into the tax for the consumer's protection.
That was the Minister of Finance's response to Canadians who have and are still voicing their opposition to the GST. I am amazed when I sit in this House and listen to the minister defend his tax. I am amazed because, first, he must have a very dim view of the intelligence of the population of Canadians when he argues that everybody who opposes this tax is wrong. They include economists, lawyers, financial experts, small businesses, provincial governments, non-profit organizations, public service organizations, the private sector and his own officials. They are all wrong. Only he and his buddies are right.
I am also amazed that he can continue serving as Minister of Finance, can keep a straight face and can look Canadians in the eye and say: "Trust me". I am not referring to the blow to his credibility with respect to the budget speech. I am referring to the promises he made only within the last year. The Minister of Finance promised that the tax would be revenue neutral. Instead it is a tax grab. He promised that it would be visible. Instead it is hidden. He promised that it would be simple. Instead it is extremely complicated.
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If the current manufacturers' tax is referred to as the silent killer of jobs, I would put to you, Mr. Speaker, that the proposed GST will be the silent killer of everything, including jobs. I want to say to the Minister of Finance, scrap the GST, and go back to the drawing board.


Gregory Francis Thompson: Mr. Speaker, we have heard that type of debate in the last number of days in this House. It does not change.
The member for Parkdale-High Park points out that we need serious tax reform, but again he offers no alternatives. He and members of his party do not come up with another plan at all. I guess he supports what the Liberal finance critic stated this morning. They favour maintaining the status quo. We realize that the status quo is broken. It has been broken since 1924. We are the first government to come to grips with that problem.
He lambastes our tax and what we are attempting to do with the GST, but again he puts forward no alternatives.
The amazing story in all this is that the opposition, especially the Liberals, criticize while not looking down the road to the future of this country. They are not serious in this debate at all.
If they were serious, they would stand up on their hind legs and give us their alternatives. They say that they want a fairer tax, a simpler tax, an integrated tax. That is exactly what the GST is going to be.
They continue to mislead the Canadian people in assuming that the new GST is going to be an added tax without using the word "replacement". I wish for once one of them would stand up and tell the Canadian people that this is a replacement tax. We are replacing an outdated, outmoded 1924 federal sales tax.


Jesse Philip Flis: Mr. Speaker, it is very clear that this Tory member who just spoke cannot read or does not listen. This is what this whole debate is about. The motion does have the alternative. The motion reads:
That this House call upon the government to abandon its ill-conceived Goods and Services Thx scheme and to bring forward in its place a comprehensive reform of the tax system that is fairer, simpler, integrated, taking into consideration all forms of taxation and the needs and practices of other levels of government-

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This government could not even get the provinces to agree. It is going to be a nightmare for small businesses to collect two levels of tax here. It continues:
-and that this be clearly visible to the taxpayers and designed in a manner that does not merely, under the guise of reform, constitute another increase in the over-all burden of taxation.
The hon. member asks where we are headed. The Tory government is headed to run this country with food banks. Some 1.4 million Canadians have to rely on food banks to satisfy their food needs. Thousands and thousands of Canadians have to make a choice. Are they going to use their money for shelter or are they going to use it for food?
The two basic necessities of life are shelter and food, and so many Canadians cannot afford both. If they want to spend more money on food, they have not got the proper apartment. I have seen eight or nine people in one room, sleeping on mats on the floor. This is the future that the Tories are bringing to Canada. When we form the government, after 1992, we certainly know what kind of a future Canadians want.


The Acting Speaker (Mr. Paproski):: Questions and comments are now terminated. On debate, the hon. member for Ontario.


Gregory Francis Thompson: Finally, Mr. Speaker, someone with some common sense.


René John Soetens: Mr. Speaker, I appreciate the cheering I am getting from the member, but I would like to get involved in this very serious debate because as a member of the finance committee I think I have a full understanding of the Liberal Party's intention in this resolution today.
I would like to go back to the actual recommendation that the Liberal Party put in the report of the finance committee to the House of Commons. Rather than participate in the process throughout Canada, they actively participated in the press conferences out in the hall and actively went to meet with all the associations outside the meetings so that they could make sure that their opinion was heard. They did not bother to stick around to hear the opinions of those who were witnesses.
Their recommendation was: "That the Conservative goods and services tax proposal be withdrawn and that
the federal government immediately begin consultation with Canadians and provincial governments on the creation of a fair and integrated reform of the entire tax system".
They do not really describe just what they mean, but it involves the entire tax system. I thought I would be able to look at today's resolution to see what they are talking about. Did they follow through on their recommendations that they had in their report? They came through with the motion today that says:
That this House call upon the government to abandon its ill-conceived goods and services tax scheme and to bring forward in its place a comprehensive reform of the tax system that is fairer, simpler, integrated, taking into consideration all forms of taxation and the needs and practices of other levels of government and that this be clearly visible to the taxpayers and designed in a manner that does not merely, under the guise of reform, constitute another increase in the over-all burden of taxation.
It is rather like the resolution. Does the Liberal Party really stand for tax reform? Does it really, seriously mean what it says in that resolution? Let us do a study and come to some conclusions. Let us just look at the record of the Liberal Party, because I think it is most important that we compare just what it says versus what it does.
I happened to go back and check the records. Yesterday, the member for Mississauga South mentioned some of the studies that were done, many of them under the Liberal Party. They include the Rowell-Sirois Commission back in the 1940s, the Carter Commission of 1966 that recommended tax reform, and the Macdonald Royal Commission that recommended tax reform. Even the member for Vancouver Quadra, when he was the finance minister back in the early 1970s, recommended tax reform. Marc Lalonde, when he was the finance minister, recommended tax reform, as did Mr. MacEachen.
All of them recommended tax reform. Here we are, finally getting around to doing something that should have been done as shown by many of the studies they did.
Suffice it to say that I was not here at that point, the previous finance committee did a very extensive study on tax reform, in relation to a goods and services tax or a value added type tax. All members of all parties in that committee endorsed the recommendation to proceed with a value added type of tax, the goods and services tax.

Liberals going back to the 1940s have been saying that the government should do something about the manufacturers' tax and the tax reform, and that we should endorse such action. Lo and behold, the Liberals did not have the guts to do it.
But what happens when a government is elected that has the guts to do it? They do nothing but criticize. They do not even have the courage of their conviction to say: "We recommended we do this a long time back, but we did not have the guts to do it. We commend you for doing what we just could not bring ourselves to do".
In the past they talked about tax reform to make it fair and simple. I cannot talk about the NDP because it has not been the government, and heaven forbid it ever gets there. Certainly we have some examples in provinces where it was the government. In fact, one of the members from British Columbia was premier and it only took them three years to discover that maybe another type of government would be more appropriate in British Columbia.
The Liberals believed in giving tremendously large grants. They believed in large Crown corporations. If de Havilland needed money, no problem. The same with Canadair, Air Canada, Canada Post and VIA Rail. Take it from the taxpayers and give it to those who really are happy to spend it.
Another example is the Foreign Investment Review Agency. All they were in favour of was big government interfering with everything. The National Energy Program not only shut down Alberta. It almost shut down all of Canada. Ontario was devastated with the PGRT taxes. They brought in taxes and tax schemes that are still with us to this day. In 1984 they gave us about a $40 billion deficit. They spent $40 billion more than they collected; $20 billion on programs. They were not even paying the cost of the programs let alone the cost of the interest, which at that point was another $20 billion.
The Liberals are calling for another study, according to their resolution today. They want another study. I listened to the member for Gloucester who proposed this resolution this morning. He recommended that we review taxes. He suggested, for example, that we look at property tax. He gave an example of a house in his riding in New Brunswick selling, I believe for $100,000, versus what it would sell for in the suburban Toronto area.
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Since when has the federal government been involved in municipal property taxes?
The Liberals talk about provincial taxes. They want to talk about excise taxes and transportation taxes. What they want to talk about is their past. What they want to talk about is big government and interference in everything in Canada.
Imagine what would happen to the municipal tax base if the federal government became suddenly involved in the municipal tax structure. It would be an absolute disaster to the municipalities. One need only listen to the cries now in the province of Ontario where the government is giving all kinds of programs to municipalities without the revenue sources to handle them. That is liberalism. It is rampant in Ontario. It is big government throwing costs on groups that just cannot afford it. Liberals stand for big government, big brothers and big Liberals.
The final report I really have to comment on was the visit today of the Auditor General to the finance committee this morning. The Auditor General made the comment that in 1984, during the federal election, he went to the Minister of Finance at the time, Mr. Lalonde, and complained that the SRTCs were going to cost us a fortune in tax leakage. What did they do about it? The Liberals said that they were involved in an election and did not want to be bothered. It cost us $4 billion to deal with their tax reform and their tax proposals. Heaven forbid we ever deal with their tax proposals again.


The Acting Speaker (Mr. Paproski):: I believe the hon. member for Okanagan-Shuswap would like to rise on a point of order.


Lyle Dean MacWilliam: Mr. Speaker, I am rising on a point of order to seek unanimous consent for extension of the sitting of the House to allow for a second member of the New Democratic Party to present his views on the motion at hand.
The reason I do so is that when I checked last, almost a half hour ago, five government members had spoken on this motion, five Liberal members had spoken on the motion and only one New Democratic member had spoken on the motion. I do beseech the consent of the House so at least we can hear one more member present the views of his constituents.

February 8, 1990
Supply


The Acting Speaker (Mr. Paproski):: The hon. member for Mississauga South on the same point of order.


Donald Alex Blenkarn: Mr. Speaker, I think in the normal course of splitting 20-minute speeches I had agreed to take on a speaking responsibility following the member for Ontario.
In view of the fact that the member for Okanagan- Shuswap is a relatively new member in the House and I get lots of opportunity to speak, perhaps we can hear the views of members of the New Democratic Party. They say they have great views and wonderful ideas. I priced some of those ideas out. Perhaps we would have some fun asking him some questions if he restricted his remarks.


The Acting Speaker (Mr. Paproski):: Instead of having an extension of hours, is it agreed that we allow the hon. member for Okanagan-Shuswap to have the last 10 minutes?


Don Boudria: Mr. Speaker, that would mean giving up the time for questioning of the previous member. I would certainly be prepared to do that.
In so far as the extension of the hours beyond six o'clock is concerned, given the fact that I, along with my colleague from Kingston and the Islands, had remarks to make earlier this week and we asked for extension of the hours and that was denied, I am not prepared to give it. However I am prepared to forgive the five-minute question and answer period in order to allow my other colleague to speak, as a compromise, to show good faith on our part and perhaps to forget a little of what happened earlier this week.


The Acting Speaker (Mr. Paproski):: The hon. member for Ontario does not give unanimous consent. Are there questions or comments for the hon. member for Ontario? The hon. member for Sudbury on a question or comment.


Diane Marleau: Mr. Speaker, I am pleased to have the opportunity to make a comment, at any rate, before my question. I take very serious offence to the sleight of the member for Ontario on the Liberal members of the finance committee.
I happen to be one of those members. I attended hearings and I spent a lot of very valuable time listening to the people who came before the committee. I very
much object to some of the comments that were made by the hon. member for Ontario. I do not believe that this House should be used for that kind of comment. It shows the kind of arrogance that some of these members have had toward these people who have taken time out of their busy schedules to come forward and make presentations to the finance committee.


René John Soetens: Mr. Speaker, I am sorry if I have upset the hon. member. Certainly there were participants from the Liberal Party during the finance committee hearings as there were participants from the NDP.
The only comment I would make is that the record of attendance is there. I grant that the member was there, but other members of her party consistently were not there and were more actively involved outside the committee process. I believe we were there to take part in the committee process. I heard most of the witnesses, by far.
I can comfortably stand here in this House and say that the majority of the witnesses were in favour of the goods and services tax. They had amendments that they would like to see, many of which were recommended by the finance committee, but they supported the goods and services tax. If those members were there listening to all the witnesses that I heard, why are they not here saying the same thing? Why are they not here saying that many of those witnesses who appeared thought that this was an excellent idea and we ought to proceed with it?


Gregory Francis Thompson: Mr. Speaker, I have a question for the member for Ontario. It has to do with senior citizens and those members of society in lower income brackets and the impact of the GST and the tax credits in relation to those two groups.


René John Soetens: Mr. Speaker, it is certainly a very appropriate question. We have had some debate today in the House about the credits that low income Canadians would be getting from this tax. Some said the credits were certainly not adequate. I would point out that that is exactly opposite to what was said by witnesses from the National Council on Poverty and the National Council of Welfare. They felt the credits that were being granted were in fact adequate.
I should add for the member's information that, for example, in his province of New Brunswick there are some 267,000 families or 75 per cent of the families in
February 8, 1990

New Brunswick who will be getting a credit in the amount of $215 on average per year. That is a very substantial percentage of the people of New Brunswick who will be getting assistance. The same is true for Newfoundland, a place where assistance is definitely needed, where low-income families unfortunately do need the help. Some 85 per cent of the families of Newfoundland will be getting sales tax credits.
Across Canada 64 per cent of families will be receiving sales tax credits. I believe we have very adequately protected those low income Canadians from added costs that might occur.


Lyle Dean MacWilliam: Mr. Speaker, I would like to thank the House for the incredible latitude it has shown in terms of equity of presentation today.
Last fall when it became clear the government was set to proceed with its kamikaze mission of imposing this goods and services tax, I took the opportunity to canvas the business community in the riding of Okanagan- Shuswap. From the North Shuswap down through Salmon Arm, Sorrento, Sicamous, Enderby, Salmon Arm, Armstrong, Falkland, Lumby and down into Vernon I talked to business owners throughout the riding and with their customers.
I have never before seen such anger, frustration and complete contempt for any government initiative. Business people, housewives, professional people, elderly people, people right throughout the riding were telling me to come back here and to kick the slats out of this government for what it is trying to do to the people not only of Okanagan-Shuswap but all of Canada. They are extremely angry and upset and they want the government to know it.
There has never been a more abusive tax measure, a more unfair tax proposal, a more damaging initiative, unless we do not exclude the free trade deal. I left almost 500 stop the tax petitions in those businesses and only 4 out of about 500 businesses that I visited did not take the anti-tax petition. People signed them in droves. Today I deposited my last instalment of 127 anti-GST petitions. Some 3,325 residents signed those petitions. That totals 311 petitions with 14,700 signatures from the riding of Okanagan-Shuswap.
That represents over 25 per cent of the registered voters in my riding who were angry enough about this tax
Supply
measure to put their signatures on the line. An equivalent of over one in four voters felt mad enough about this gouge and squeeze tax to sign these petitions.
As well as that I have received over 1,000 stop the tax protest cards. In fact this is a package of over 1,000 mail-backs asking the government to stop this tax. As well, I have over 5,000 questionnaire surveys. Here is one box with 1,000 in it, and there are four more in my office upstairs.
The people responding in those surveys have made it very clear that they want this tax stopped. They do not want it reduced, modified, or phased in. They want it stopped, killed, DOA.
They want that because they know that this tax is going to hurt them. It is going to hurt them as consumers. It is going to hurt them as small business people who are trying to get by and maintain their standard of living.
Consumers know that it means a higher cost of living. Seniors know that it means doing with less again, and those less fortunate also know that it means tough times ahead.
Tory times are tough times. Tory times are taxing times, and these Tory tax tricks are terrifying people right across Canada.
I know my time is very limited and I appreciate your indulgence, Mr. Speaker. I want to read into the record a few comments from people in the Okanagan-Shuswap. A constituent in Salmon Arm writes: "The GST is an insidious assault on working people, retirees and average Canadians. We are fed up with the continued assault on Canadians by this government."
Here is one from a former president of the Conservative riding association in my constituency: "This tax will play hell with the tourism industry and the people of Canada."
And a third one: "Why is it that the average Canadian continually has to bear the brunt of financial incompetence of our government?" That is from a Mr. Johnson.
There are many more comments like them. I could go on at length. However I think they give a very clear message that people not only in my riding but throughout Canada are extremely upset with this proposed tax measure. There are better ways to reduce the debt. We have talked about them repeatedly. My colleagues in the

February 8, 1990
Adjournment Debate
New Democratic Party have proposed a number of alternatives.
I submit to you, Sir, that one way is to get tough with the corporate welfare bums. I know that term was used years ago, but it still relates today, those corporations that continue to stick their snouts into the federal trough. The government is giving away $30 billion-


The Acting Speaker (Mr. Paproski):: I regret that the hon. member's time has expired.
It being six o'clock p.m., it is my duty to inform the House that pursuant to Standing Order 81(17), proceedings on the motion have expired.



ADJOURNMENT MOTION

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

Jean-Robert Gauthier: Last Friday, Mr. Speaker, I tried to find out whether the government was planning to issue the regulations related to Bill C-72, which the House adopted in the spring of 1988.
Mr. Speaker, these regulations are necessary for Canadians to know exactly with what tools the legislation will be implemented. The Official Languages Act needs its own regulation, because, otherwise, it would be like a boat without a rudder. The target would be easy to see but difficult to reach.
Following the adoption of the legislation in July, 1988, the Official Languages Commissioner wrote last year in its annual report, and I quote:
We hope the first regulations will be tabled in the House by the end of 1989.
He made that statement in his annual report.
On April 11, I asked the president of Treasury Board when he expected to table his draft regulations. This is what he said, and I quote:
In today's report, the Commissioner said that he hoped regulations would be tabled by the end of 1989. I can assure the hon. member that the regulations will be tabled in the House well before that date, so that we can have final consultations with all members of this House.
Mr. Speaker, it has been 20 months since the act was passed, and 10 months since the President of the Treasury Board promised in the House that regulations would be tabled. It will have taken nearly three years, if you know what the procedures are, to give this legislation some teeth, to have a set of regulations adopted and implemented.
Mr. Speaker, this is a very long time for what I consider an urgent matter. I think that considering the symptoms we are seeing in this country, symptoms that are widely known and in deed regrettable, we cannot let this kind of intolerance exist with respect to certain groups across the country.
If the government does not table the regulations, if the government is reluctant or perhaps afraid to table its regulations today, it compounds the problems for Canadians who need to know the objectives and methods by which the act is implemented. It is a very difficult situation, especially for Francophones outside Quebec, because we need these regulations to have a clear understanding of the policy and how it is applied. Mr. Speaker, there are three main chapters that require clarification.
Language of service: in other words, the language used by Canadians to ask the government for the services to which they are entitled.
The language of the institution: being bilingual, Canadians may chose the language in which they wish to communicate with the government. The language of services to the public is essential. What are the regulations in this respect? Well, we don't know, Mr. Speaker. But I can tell you that the language of service, Section 26 of the act, safety and security of the public, is important and we must know where we are going.
Section 32: definition of significant demand. In what regions of our country will we provide services to Canadians in the language of their choice?
Section 33: authority of the Governor in Council to oblige institutions to provide those services. So, there are three sections in this act that are very important and require a regulatory definition.
The other component, Mr. Speaker, is language of work.
February 8, 1990

Section 38: The obligations of the employer-the federal government or, if you prefer, the President of the Treasury Board as our representative-to promote the language of work (documents and all other work instruments). Prescribe parts and regions conducive to the use of the language of work. Here again, Mr. Speaker, firm decisions must be made to determine where, when and how these rights will be exercised.
Finally, fair participation.
Section 40: Ensure equal access to employment by both linguistic groups-the English-speaking minority in Quebec and the French-speaking minority outside Quebec-while maintaining the merit principle.
Mr. Speaker, these three issues-language of service, language of work, and fair participation-call for clear and specific regulations. I know that the government did consult with minority associations, I know it did consult with the various departments. I also know that the government is sitting on its regulations. I am asking the government why hesitate now to let Canadians know the major points of the regulations which would put some teeth in the Official Languages Act and give us an idea of where we are going. The government simply has to change course, Mr. Speaker, and that does take a bit of courage.
However I will not say what I think, that the government lacks courage. In that respect, Mr. Speaker, I think there are enough Members on the other side of the House who believe in the objective of the official languages, who like me will very soon want to know just what the government plans to do about the official languages. This once, for heaven's sake, give us an answer!


Mr. Howard Crosby (Parliamentary Secretary to President of the TVeasury Board):: Mr. Speaker, before I respond to the hon. member for Ottawa-Vanier let me very quickly cover three points.
First, in the House this week the Prime Minister and the government confirmed in a motion their commitment to official bilingualism and language policy in Canada. That motion reaffirms the commitment to support, protect and promote linguistic duality in Canada as reflected by this House in the Constitutional
Adjournment Debate
amendment, 1987 and the Official Languages Act. The commitment is there and clearly confirmed.
Second, let me say to the member for Ottawa-Vanier that everybody in this House respects his devotion to the promotion of official languages. I personally encourage him, as a person from a predominantly unilingual English area, to continue that commitment and not to hesitate to express his views at any time.
The third point, which I think is the most important of all, is that our language rights are embossed in the Canadian Charter of Rights and Freedoms. No legislative act or regulation can improve on the enshrinement of language rights in that constitutional document. I would like to think that the language minorities of this country are protected by our Constitution, but that does not mean that we should not move to improve and implement those rights in any way we can.
That brings me to the Official Languages Act, which members of this House enacted in July, 1988. That Official Languages Act was a very special kind of document. Great care was taken to ensure the proper implementation of the provisions of the document relating to language rights.
The member specifically mentioned language of services. That is one of three important areas covered by the Official Languages Act.
The member also knows that the House of Commons when it enacted that important piece of legislation provided a very special procedure. Unfortunately, that special procedure is quite complicated. It involves various processes that delay passage of regulations, but it is designed to ensure that when a regulation is made and acted upon it will have the real support not only of this House of Commons but of all the major linguistic groups in the country.
It is to that end that we would like to direct our attention, not simply regulations for the sake of getting them through quickly but regulations that have meaning, that are accepted and will be enforced and have the support of everybody involved.
I do not need to remind the member of the complications of the process but he knows that it involves time frames, presentation to the House and publication of regulations in the Royal Gazette. It is a five-step

February 8, 1990
Adjournment Debate
procedure which I will not detail because it is contained in the provisions of the Official Languages Act.
One of the important parts of the process is consultation. That consultation has taken place but it is not a process that starts and ends, it is a continuing process. If anybody sees any difficulties that would be an impediment to the implementation of language policy I think they have to consult at whatever time and regardless of what past consultations have taken place.
Let me conclude by saying that it is a difficult process but it is a process that is worth following carefully because in the end, if we have regulations that implement the language policy as adopted in the Official Languages Act with everyone's consent and concurrence, then the regulations will be effective and they will accomplish the end that we all desire. I know that that is the aim and goal of the member for Ottawa-Vanier in particular as well as of all members of the House.


JUSTICE
Robert Evans Skelly: Mr. Speaker, I rise to express concern about the response to my question on January 29 with respect to the Donald Marshall inquiry and the recommendations made under that inquiry.
At that time I asked the Minister of Justice and Attorney General of Canada what that minister was going to do with respect to the number of specific recommendations made by the Marshall report which fell entirely within the federal jurisdiction. I referred to issues such as establishing a court worker program or a native court system in the native areas of Nova Scotia or dealing with the establishment of a justice institute.
I also addressed a question to the Solicitor General with respect to the recruiting and hiring of RCMP officers of minority origin, in this case specifically native Indian origin.
This is an extremely important issue. As you are aware, Mr. Speaker, there are inquiries into the equality of justice being administered to natives all across Canada. There is an inquiry going on in Alberta now. There is an inquiry being pressed for in Saskatchewan, although the Attorney General for Saskatchewan is refusing to get involved in an inquiry even though the number of natives in jail in Saskatchewan is grossly out of proportion to the number of natives in the general population and there is clearly evidence that the justice system treats natives
differently than it treats Canadians of other racial origins.
My specific concern was about the recommendations of the Marshall inquiry. In response to one of my questions the minister indicated that within seven to ten days he would be coming down with responses to the specific recommendations of the Marshall inquiry. In the meantime, he indicated he would be consulting with the authorities in Nova Scotia. As the Speaker is aware, the authorities in Nova Scotia have come out with a relatively detailed response to the recommendations of the Marshall inquiry.
As I pointed out in my statement made earlier this morning, I believe, as do many Canadians, that the response made by the Government of Nova Scotia was completely inadequate. In fact, it tended again to put the blame on Donald Marshall as being the author of his own misfortunes. I would like to quote briefly from the executive summary to the response of the Government of Nova Scotia. It states: "Difficulties Micmacs encounter with the justice system are rooted in social, political and economic structures outside the justice system and are not the result of any evil intention to discriminate by justice personnel."
We saw in the Marshall inquiry report that that statement is absolutely false. The justice system, according to the Marshall inquiry, failed Marshall, and according to the findings of the inquiry, it failed Marshall because he was a native Indian.
I think it is good and worth while that the Attorney General of Nova Scotia, Mr. Mclnnis, has apologized to Donald Marshall. I think it is a good and worth while action on the part of the government of Nova Scotia that it has now referred the issue of compensation back to Mr. Justice Evans to investigate a possible increase in the compensation given the fact that both federal and provincial authorities were at fault for the racial prosecution that took place against Mr. Marshall.
I think more has to be done by this federal government. Native Indians in Canada are the jurisdiction of the federal government and justice to native Indians is a problem all across this country, not simply within a particular province of Canada. The problem is not that Indians run into more mistakes with the federal justice system or that there are collections of circumstances which cause more problems with Indians. The problem is
February 8, 1990

that aboriginal people are discriminated against by this justice system.
In part, Mr. Speaker, it is a cultural thing. I think we saw evidence of that in the Innu case that is taking place in Labrador right now. The Innu are being expected to testify before a court which they believe is on a land that has been stolen from them, before a judge who represents the people who stole the land from them, to try to establish why they should not have the right to occupy land which was taken from them without compensation and without any documentation.
As I say, the system of justice in this country discriminates culturally against native Indians and we need to have quick, distinct, positive and proactive answers from the Minister of Justice in this House so that natives in this country will be able to have some expectation that in the near future we will not have any more Donald Marshall situations and we will not have any more of the kind of situations that are taking place with the Innu people in Labrador.


Kenneth Albert James: Mr. Speaker, the report of the royal commission on the Donald Marshall, Jr. prosecution was anxiously awaited by a great many Canadians. The prosecution, wrongful conviction and imprisonment of Donald Marshall, Jr. has come to symbolize for the public a growing awareness of problems in the criminal justice system, particularly as those problems affect aboriginal persons.
The federal government is deeply concerned about this issue. The Minister of Justice chairs a committee of federal and provincial ministers responsible for justice matters and this committee has identified aboriginal criminal justice as a matter of highest priority. The minister and the federal government actively and regularly consult with native groups about necessary reforms in the system of aboriginal criminal justice.
I can tell the House that this is a subject to which the hon. minister has devoted and will continue to devote considerable attention.
Adjournment Debate
The release of the royal commission report represents an important turning point in the history of aboriginal criminal justice and is now receiving a most detailed review. The commissioners found that the criminal justice system failed Donald Marshall, Jr. from the time of his arrest, conviction and imprisonment in 1971, up to and even beyond his acquittal by the Nova Scotia Court of Appeal in 1983.
The report does not, however, just indicate where the system has gone wrong, it also makes a number of thoughtful and far-reaching recommendations for reform. Since the report was released the minister and the Department of Justice have been carefully studying its findings and recommendations. The Minister of Justice has conferred with his provincial counterpart in Nova Scotia and the department has as well discussed the matter with interested parties including a number of native individuals and organizations.
The interest of the hon. member for Comox-Albemi in the matter is well recognized by this House. The Minister of Justice shares the interest and is giving consideration of the royal commission report priority attention. I expect the Minister of Justice will respond to the parts of the report which pertain to the federal role in the administration of criminal justice in the very near future.
In closing, I would like to indicate to my hon. friend that all Canadians share his concern about the wrongful conviction and imprisonment of Donald Marshall, Jr. and the findings of the commission. Nothing can properly compensate Mr. Marshall for the years he has been in prison. We can, however, use this opportunity to take what steps we can in order to ensure that this tragic case does not recur.


TELECOMMUNICATIONS
Mr. Ray Funk (Prince Albert-Churchill River):: Mr. Speaker, on November 3 I rose to ask the Minister of Communications why he had rejected out of hand and refused to negotiate a compromise proposal on the regulation of telecommunications that had come from the prairie phone lines, the three prairie governments, when they proposed that the prairie governments should maintain control of local service, that the federal govern-

February 8, 1990
Adjournment Debate
ment should control interprovincial and international service and that the cost of maintaining affordable local service be split.
Prairie people are getting very frustrated with this situation, as am I, because the minister says he is negotiating but in fact there are no negotiations taking place at all. The minister is repeatedly holding a gun to their heads and saying: "You either do it my way or I will take unilateral action", and that is not negotiation.
Obviously the minister is ignoring two very important elements of this situation. One is that the prairie phone system was built over 80 years by the people of the prairies and is a very appropriate system to that part of the country and is recognized as one of the most modem and efficient in the world.
Second, he ignores the very real consequences. His own department produced the Sherman report which said that nine out of ten users would pay more than they are now for local service, including 90 per cent of businesses, with the justification for this whole move being that businesses would be more competitive. In fact, 90 per cent of businesses would pay more.
Then, just this week, a report done by Dr. Robert Olley, an internationally respected telecommunications expert, came out which said that the basic phone rates on the prairies would rise 167 per cent for rural users and 140 per cent for urban users.
What is happening here is that people who have low incomes, people who are in isolated areas, people who live in rural areas, are going to find themselves more and more cut off from the basic phone service that everybody needs to become part of modem society and be part of a modem economy.
Furthermore, it totally ignores the fact that there are different ways of doing things in the different regions of the countiy. It seems ironic that the Minister of Communications, who is very much a champion of his particular region, should so totally ignore institutions that have been built up and work very well in our particular region of the countiy. That kind of attitude certainly does not help to lessen the stresses and strains which our country is feeling.
Therefore, I would like to ask again, why is this minister proceeding in unilateral fashion, without any kind of meaningful negotiation with the prairie phone
systems, to introduce a phone system that would be a Cadillac system for the wealthy, the big businesses and the people in big cities while the low-income people, the people in isolated communities, the people in rural Canada, the people in the hinterlands, would become more and more second-class citizens? That just does not seem right to me and I would like to know what the real answer to that is.


Mr. Jim Edwards (Parliamentary Secretary to Minister of Communications):: Mr. Speaker, I am very pleased to have the opportunity to respond to my hon. friend. Over the last five years the Government of Canada has conducted extensive negotiations with the provincial governments to find a way to accommodate their role in and responsibilities for telecommunications. I have had the honour, Sir, of being part of the most recent negotiations and I can assure my hon. friend that they were very serious negotiations with no gun held to anyone's head.
The concept of two-tier regulation was rejected by the industry, including the provincial telephone companies. So, with no satisfactory settlement, a new approach and a new consultation mechanism was called for. The federal government decided it would be in the best interests of all Canadians to resume those negotiations. The emphasis now was to develop mechanisms for effective consultation and thereby ensure that all levels of government be involved in future policy and regulatory formulation.
The new comprehensive legislation that the minister intends to table shortly is based on the over-all objective of not only creating one national telecommunications policy and a simplified regulatory framework with one regulator, but also the promotion of equality for all regions, regional sensitivity in policy and regulatory formulation, a thriving market-place in the supply of telecommunication services and equipment, and an open market.
There has been drafted a new memorandum of understanding with the provinces. We have consulted with them on this matter and have received a favourable response. The memorandum of understanding and the proposed telecommunications legislation does include the proposals of the Prairie Telecommunications Alliance.
Notably, some of its proposals are the following: regulation must be sensitive to the priorities of rural
February 8, 1990

development; it must recognize provincial participation in developing ongoing maintenance of national telecommunications policy; the national policy must promote industrial development in the provinces; and national telecommunications policies must include measures that enhance our international competitiveness and reduce regulatory burdens.
We are now in the wake of the Supreme Court decision of August 14, 1989, which found that regulation of provincial telephone companies was within the ambit of the federal government and, notably, the CRTC. Now Canadians are concerned about rates. Most Canadians are concerned about possible increases in their local telephone rates. The proposed legislation which is to come has no impact on specific rates. The most significant change that will result from the legislation is the simplification of the regulatory structure.
No existing regulatory decisions, orders or associated items of service will be affected. Significant changes in any rates require a thorough public hearing process, I should add, much more open than the process that exists in the hon. member's own province of Saskatchewan where rate decisions are made behind closed doors by cabinet and not even by a public utilities commission.
The CRTC's vigorous public hearing process will now be applied to all regions of the country, creating uniformity of the decision-making process. This does not imply, however, that the rates between or within companies' areas of service will be changed. Again, such changes, if and when they occur, must occur only through public hearings in which all interested parties can participate.
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I wish to emphasize that the introduction of the new telecommunications legislation has nothing to do with the issue of whether long distance competition should be introduced.
Finally, I wish to conclude by saying that the large increases in local rates suggested by several opponents of long distance competition, including my hon. friend, are based on extreme assumptions.
The federal government commissioned a federal- provincial task force to examine the impact of long distance competition. That is the Sherman report. We agree that some rate changes may occur. Even under the most extreme assumptions in the Sherman report, local telephone rates did not increase appreciably. But, as stated in the report, the size of this impact depends on basic assumptions. It will not be until we have a formal submission that more conclusive evidence could be made available concerning the actual impact of the introduction of long distance competition on local rates. There has been no submission for long distance competition involving the prairie region of the country.
I should emphasize, just in concluding, that the telecommunications policy, the telecommunications legislation which is about to be tabled in this House, has no relationship with long distance rates.


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


[Stage Direction]
The House adjourned at 6.29 p.m.
[Stage Direction]
Friday, February 9, 1990