1990-11-26

['Mr. Speaker, the Minister of Justice has been sabotaged by her own back-bench on a major piece of legislation, the gun control bill.\nLast week, she was forced into the humiliating spectacle of filibustering and blocking her own bill. Her only other significant act in her tenure so far-other than calling my colleague, our House leader, cute-is the recriminalization of abortion, which she professes to oppose.\nIt is almost a year since the massacre of 14 young women at the Ecole Polytechnique in Montreal and six months since the Minister of Justice promised its students action on gun control, a promise now betrayed. To think that just a month ago, some journalists were talking about the minister as a possible successor to Mr. Mulroney. They should look again at this record of', 'Oral Questions\nincompetence, defeat and lack of political will, especially on abortion and on gun control.']
Mr. John R. Rodriguez (Nickel Belt) moved: that Bill C-217, an act to amend the Bankruptcy Act (priority of claims) be read the second time and referred to a legislative committee.
He said: Mr. Speaker, my bill is being debated at a most propitious time, a time when this country finds itself in recession, when it finds that bankruptcies are soaring beyond belief. Personal and business bankruptcies are up 60 per cent. Bill C-217 addresses particularly the whole question of business bankruptcies and their effect on employees.
My bill which cries out for some attention by this government attempts to correct an injustice to employees who, when the company goes bankrupt, end up going to the back of the bus to get any kind of compensation for lost wages and benefits, and in some cases even pensions and vacation pay.
The Bankruptcy Act came into effect in 1949. It divides creditors into secured creditors and preferred creditors. Secured creditors are banks and any other individual or group who has lent money to the company and their
loans are secured against the equipment and assets of the company.
The employees are preferred creditors and the preferred creditors are limited in the 1949 act, which is still in effect, to a maximum limit of $500. This may have been quite generous in 1949 but since it has not been adjusted since then is really an insult in 1990.
In 1966 amendments were passed which provided some administrative tinkering with the act with respect to filing a bankruptcy for individuals. In fact it never dealt with the very important question of securing for the employees of a bankrupt company their past wages and benefits. It did nothing at all about placing them in a spectrum or in a line so they would take some priority with respect to getting any money when the company goes bankrupt.
We had an example here in Ottawa. Leigh Instruments in Ottawa went bankrupt in about April of this year. Seven hundred and fifty employees lost their jobs. These employees go to the back of the bus when it comes to collecting their lost wages and benefits, and then they could only collect to a limit of $500.
What happens is that the bank gets its cut and any other secured creditor gets their cuts. If there is any money left in the pot, then come the employees. They can get a limit of $500. If the amount that they are filing for exceeds $500, they then have to make a separate claim which has to go to the end of the list.
After the secured creditors get their take from the pot, there is nothing left for the preferred creditors. The employees, in many cases, get nothing. We do not even have to talk about the red tape of the bureaucracy and the administrative detail of filing with the bankruptcy trustee, and the time it takes to even collect the crumbs to which they might be entitled.
This matter just did not start in 1990. There have been all kinds of studies done by successive Liberal and Tory governments since 1970. They have studied this question to death. They promised that they would amend the

November 26, 1990
Private Members' Business
Bankruptcy Act. In the early 1980s, the then consumer and corporate affairs minister tabled a bill. It died on the order paper.
In 1986, the previous consumer and corporate affairs minister of this government, the man who is now the House leader for the government-


An hon. member:: Is that Harvie?


John R. Rodriguez: That is Harvie Andre, -said that amending the Bankruptcy Act to give more protection to employees was one of his priorities. Two ministers and four years later, this priority has not been achieved yet.


An hon. member:: The banks got to him.


John R. Rodriguez: The banks got to him. It shows that there are other priorities that have more priority.
Now we come to the present consumer and corporate affairs minister. What is he saying? He said in the House the other day, "I am going to look at the NDP proposal in Ontario where some kind of fund will be set up". Where have these people been? Where are they?
First of all, I want to say in making my argument that there are two things that have to be considered. One is the limit. I have dealt with the limit in my bill. I have raised the limit to $9,000 per employee.
I do a second thing in the bill. I moved the employees to the top of the parade. They go to the head of the line.


An hon. member:: Where they should be.


John R. Rodriguez: I want to talk about the secured creditor and the preferred creditors of business. I do not understand secured and preferred. I really do not. They can secure a loan against a piece of equipment-a chair, a table, or a microphone. This is secured creditor. But what about the workers' toil, labour, commitment? Is that not a secured right? When an employee works for an employer, he puts in his commitment, labour, time, effort and loyalty to the company. That has to rate above securing a loan against equipment. The employee has given credit to the company and that credit has to be secured ahead of the security against equipment and the money that the company borrowed against equipment.
We have two problems. It is not just raising the limit to $500. It is actually saying that employees come first and the banks go to the back of the bus, or secured creditors go to the back of the bus.
My friend across the aisle is smiling because he knows that what I am saying is common sense.
I do not know what the great fuss is about. I do not know why this government and previous Liberal governments have sat on this egg for so long. I know the gestation period for an elephant is nine years. Surely, this has got to be a super elephant to try to amend the Bankruptcy Act. It cannot be that difficult.


An hon. member:: What's the gestation period for the NDP?


John R. Rodriguez: The member wants to know what the gestation period for the NDP is. Let's go to an election now and we will see where you are going to be dispatched to. You will be dispatched to the waste basket of history, brother, just like Maggie Thatcher.
There has been a suggestion from the government that it will look at a fund. Employees and employers can contribute to the fund. I have a problem with that. Why should the employees contribute to a fund? They are not responsible for the company going bankrupt. Oftentimes, it is the company's own fault that it goes bankrupt. Employees do not have any participation in the decisionmaking of the bankrupt company, that is, management's right to make decisions for the company. Those are protected very fiercely by management. Why should the employees put their own money into the fund so that when the bosses make the mistakes and lose their jobs, they get paid back their own money? Why should they be contributing to the fund?
If the workers go to the head of the parade, then the employees will get their share on a priority basis when the assets are sold. It seems to me that that makes a lot of common sense. Surely, if this is a priority for the government, it ought not to take four years and three ministers of consumer and corporate affairs to realize that the legislation has to be placed before the House of Commons. There have been enough studies done on this matter. There has been other legislation which has been attempted. Yet, we still do not have the Bankruptcy Act updated.
Recently the Auditor General said in his report that it is a crying shame and it is a scandal that employees of bankrupt companies are left without the moneys for which they have worked for the company. This situation has been allowed to continue. Only a heartless govern-
November 26, 1990

ment-I am not talking about brainless-can turn a blind eye to the misery that the present act creates. Surely, after a person has worked so many years for a company and the company goes bankrupt, it is not good enough to say that they have to join a line and, in the meantime, go on welfare. In most cases, the company has not paid the UI premiums. That has to be sorted out because the Unemployment Insurance Commission goes to the back of the line, as well.
Surely, that is not the way a caring, feeling, sensitive society treats people who, through no fault of their own, end up losing not only their employment, but they lose the wages for which they have worked and contributed.
I know the Conservative government is looking for good ideas because it does not think of any good ideas. There is a magnificent government in the province of Ontario that is about two months old. In its first Throne Speech it has outlined its determination to come to grips with the whole question of employees getting a fair shake on their wages, benefits, and possible pensions lost as a result of bankruptcy. It is determined to move ahead with a fund, but this will only apply to provincially incorporated companies.
Where is the leadership from the federal government? I saw the government move with more action on the question of sending the Nina, the Pinta and the Santa Maria to the Gulf, without even the United Nations having approved it. It moved with the speed of light. Yet, Canadians are being treated unjustly, unfairly, and most shabbily.
All the government needs is the resolve to say, that yes, the workers of a company that goes bankrupt must go to the head of the line as secured creditors. I cannot stress that more firmly, Mr. Speaker. They are secured creditors. They gave hours of work as credit to the company, yet they are being treated as preferred creditors. In this case, preferred might sound nice. At the racetrack there is preferred parking, and it sounds like you are being treated special. But, in this context, preferred does not amount to a pinch of salt. A pinch of salt. The government does not give a pinch of salt.
Private Members' Business


Mr. McWilliam:: It doesn't work.


John R. Rodriguez: It doesn't work. I am not going to put salt in the wounds here.
Where is the federal leadership from the government? The government of the province of Ontario, in office only two months, has already indicated a desire to move in the direction of clearing up a problem in its own backyard with respect to the employees of bankrupt companies. Yet, the federal government, with all the vast array of personnel in the Department of Consumer and Corporate Affairs, the vast treasury of the federal Parliament, and the people of Canada, and all we get are pious statements that it is a priority. A minister says: "It is my priority." Before the guy could realize his priority, he has gone through the revolving door and the next cardboard figure comes up for us to take target practice at. Just when we are getting warm with him, he resigns from the cabinet.
Then we get another cardboard figure coming through on the revolving door. He has been studying this question for a year now. He is just a slow studier. He studies slowly. The minister, too, now says right here in the House of Commons: "I am going to look at this proposal." A federal minister may borrow a NDP idea on worker protection in bankruptcies. He may. He is even playing on the words now. He does not say: "I will borrow." He says: "I may borrow." Of course, if he borrows that he is a secured creditor, or is he a preferred?


Some hon. members:: Oh, oh.


John R. Rodriguez: My bill, I think, is timely. It comes at an appropriate time. It is an excellent bill, not just a good bill. It is an excellent bill. It deals with the current problem, a problem that has been festering for too long. Yet, the government, which has the responsibility to lead, has reneged on its responsibility by not acting. We cannot treat people who are unequal in an equal fashion and compound it by treating people who are unequal in an unequal fashion. The government, by closing its eyes to this blot on the escutcheon of labour and management relationships in the country, should hang its head in collective shame, that it has done nothing about this problem.
Why does the House not pass my bill and let us get on with it. If the government cannot do it, I have done it.

November 26, 1990
Private Members' Business


Some hon. members:: Hear, hear.


Mr. Dave Worthy (Parliamentary Secretary to Minister of State (Privatization and Regulatory Affairs) and Minister of State (Finance)):: Mr. Speaker, the hon. member for Nickel Belt again did himself proud. He does do a good job when speaking to bills.
I would like to emphasize that I believe, probably as strongly as the hon. member for Nickel Belt, that the current Bankruptcy Act does not provide adequate protection to Canadian workers whose employers have gone bankrupt. I would review the existing Act briefly.
The existing legislation allows workers a privileged claim for up to $500 in unpaid wages and commissions. In 1949, when this law was enacted, $500 meant three months' wages. That meant that three months' wages were protected for that worker. A lot has changed in 40 years. Five hundred dollars is now just a week's wages. This Act that we have now unfortunately protects a worker for one solitary week. Of course, not every worker is able to collect even that first $500 or the rest of his or her wage claim. There are simply not enough assets to give workers their due in most cases, not when the workers' claims are dealt with only after the banks have recovered on their securities and after the trustees have been paid.
I am told that over half of the workers who submit a claim for unpaid wages in bankruptcy recover little or nothing from their claim. First, the workers find out that the wages that they have woi'ked hard for and for which they are due, will not be paid to them. Second, they find out that they have a waiting period, even if there was going to be some payment. Of course, if they then turn to unemployment insurance, in many cases they have to wait for it as well because technically they have money coming to them from their former employer. Eventually, if they do recover any money from the company, it is long, long, after the bankruptcy. It can be years before any amount is paid to the creditors, and this is a long time to wait. It is a long time to wait for a nearly forgotten pay cheque, especially if you are out of work.
Canadian workers certainly deserve to have those wages paid. But, the changes we are talking about today, I am sorry to say, do not correct that situation. This
legislation, although it is based on a good intention and a good idea, offers workers a super priority. It is a super priority claim for their wages, commissions and pension contributions, going back six months, to a maximum of $9,000.
Super priority means that the workers who have valid claims will be paid before the secured creditors receive anything. On the surface, that sounds like a good idea. These secured creditors are often banks, but they might also be businesses or other individuals. Secured creditors hold securities or mortgages as collateral against the money they have loaned the company that is now bankrupt. These securities must have been properly registered so that subsequent creditors could be aware of liens on a company's assets. It is important to see that a security is a precise thing.


John R. Rodriguez: The workers are precise.


Dave Worthy: The workers are of ultimate importance, but one has to understand the environment.
Let us say that creditor a has a mortgage on a bankrupt company's factory and creditor b has registered a security on an office building that the company owns. The way a bankruptcy is administered, under the law, is that the factory and office building can be sold.


John R. Rodriguez: Who is more important?


Dave Worthy: Obviously, the people are more important. The money received from the factory goes, first, toward paying creditor a what is still owed on the mortgage. The purchase price of the office building goes to pay creditor b. It is only then that the value of the remaining assets are distributed to other creditors including workers. In this case, they may or may not receive their money.
The hon. member in his bill has not explained how workers will be paid, before the creditors a and b. Will the unpaid wages be paid out from the proceeds from selling the factory or will they be paid from the proceeds of the sale of the building or will they combine the proceeds from the building and the factory or will some employees only get paid if there is a surplus from the factory?


John R. Rodriguez: Sell it all and you will make the
workers worse off.


An hon. member:: Are you addressing the right bill?
November 26, 1990


Dave Worthy: I have to apologize, Mr. Speaker. Obviously, I have confused some of the people. The question has to be looked at. Someone has to consider the issues when legislation is put down. One has to have answers which satisfy all conditions. The hon. member, in spite of his good intentions, has not considered all those alternatives.
Over the last 15 years there have been six bankruptcy reform bills which have been put forward in this House. The first and the last proposed super priority for wage earners. In the case of the last bill, the system devised to administer super priority for wage claims was so complex that it took 31 subsections to explain it. Both times that super priority was considered by this House or the other, the conclusion was that it did not answer all of the problems for providing promptness and certainty of payment to those workers. It was considered by many to be impossible to administer. If it cannot be administered and does not solve the problems, it really does not provide protection to the workers.
In case my colleague has not been convinced of these arguments, I would like to discuss the impact that the implementation of super priority could have on the lending industry.
Increasing the priority of paying wage claims in bankruptcy, as I have already shown, will have a direct impact on secured creditors.
Most of these, as the hon. member knows, are banks. As a result, they will be facing a higher risk with the money that they are lending to these companies. To compensate for this higher risk, and the hon. member knows better than most in this House, the banks will find it necessary to increase their rates.
Increasing the interest rates on the business loan is not exactly what we are trying to achieve in today's economy. In fact, it is exactly the opposite of what the businesses nowadays need.
Super priority leads to distortion in lending practices. We have already mentioned it can lead to higher interest rates. In many cases, that higher interest rate based on the argument I have put forward could in fact break the camel's back. It could be the straw.
Similarly, recognizing the super priority would risk their investments. Banks might begin, in fact, to move
Private Members' Business
more quickly to foreclose to ensure that they do get their assets returned. This could trigger action by banks that would create more foreclosures than we have now. This also is opposite to what we want to achieve.
Mr. Speaker, I see you signalling that I only have a minute. I have so many arguments to face here, I will have to try to summarize them.
I think if I am going to summarize many pages into the key points, we have to recognize that the worker who the hon. member has gone out to protect is the one who does need to be protected. His best protection is, in fact, the job, and wherever possible, a continuing job. I think the hon. member would agree with that.
A bill that tries to address not only the employee and his or her protection, but tries to ensure that those companies that are approaching bankruptcy get all of the assistance they need, in fact trying to prevent the bankruptcy from occurring, is the best protection that you can get, Mr. Speaker, for those same employees.
The member's intentions are good. He has argued well, but in fact this bill does not solve enough of the problems. We would be wise to wait for the government's bill that will do so.


Mr. Ron MacDonald (Dartmouth):: Mr. Speaker, I am very pleased to rise today and support the initiative of my friend from Nickel Belt.
It is something that this government obviously lacks either the intellect or the courage to do, that is to take the bull by the horns, particularly in these very trying times, and to try to initiate some change in the outdated Bankruptcy Act, and to protect the interest of workers in bankrupt firms.
It is very easy to stand here and to criticize a member because his or her particular piece of legislation does not go far enough. The parliamentary secretary just said: "It is a good proposal, but it will not work because it is very complex." It is a big world out there, and since 1947 or 1949 nobody has been able to figure out how to make this piece of legislation better.
If anything, the parliamentary secretary should have first of all admitted the impotence and incompetence of this government in coming to terms with a very real problem. He could have said: "The legislation no longer has any relevance in a modem economic world, and we cannot do anything about it. We do not have the

November 26, 1990
Private Members' Business
wherewithal to come in with a comprehensive set of changes to the Bankruptcy Act." He could have asked some of the members on this side of the House and on the New Democratic Party side of the House for some
assistance.
What we are seeing is a made in Canada recession. I know the government does not like to hear that, but when we talk about recession of business downturn, it means the companies go out of business.
Companies are going out of business at an unprecedented rate now because of the government's reckless economic policies. The government could not control growth in southern Ontario.
What did they do? The only weapon that they could find to use to try to cool down that engine was high interest rates. So they jacked up the interest rates to an unconscionable level and caused the level of bankruptcies, usually in the peripheral economies in the Atlantic, in the north, and in the west, to go through the roof.
In the Financial Post of November 22, just last week, we read: "Bankruptcies Leap". My goodness, the headline must be three inches high. "Cases rise 61 per cent as recession takes financial toll". There has been a 61 per cent rise in bankruptcies. At a time when this government has caused a recession that is pushing bankruptcies to an unconscionable level, it absolutely, positively, fundamentally refuses to sit down and look at the changes that are necessary to the act to protect the interests of workers.
The way the act is currently, it gives you 500 bucks. Big deal. My friend opposite, the parliamentary secretary, admitted that maybe $500 in 1949 was three months wages, but $500 today, if that is what you are making a week and you have a family of two, probably would put you below the poverty line. With $500 a week, you are still going to a food bank, for goodness sake, in order to feed your kids, if you live in any major city in this country.
He admits that the $50U limit is unconscionable. It does not address the real needs, but at the same time, he tells us to wait until the government comes in with more comprehensive changes. I am not going to pretend that changes to the Bankruptcy Act are going to be easy. They are going to be very complex.
If Bill C-217 goes through, what is it going to do to the banking institutions? Are they going to still want to lend money to some of the small businesses that are very labour intensive, like a trucking firm? They probably do not get paid for 45 or 60 days. What are they going to do? Are they going to be able to get financing? There are the real considerations.
I have always attacked a problem by looking at what was the most grievous error in the system before deciding what was the best solution, and then effect all of the other necessary changes as a result of that solution. That is what my hon. friend's motion does. It states a desired outcome.
A worker's wage interest in a company that is going bankrupt today because of this government's fiscal policy is protected. That interest is not protected for a measly $500, but it is protected much deeper. Again, he says that we cannot support this because we do not know how to solve all of the rest of the problems.
The government does not know how to solve the rest of the problems with the Bankrupt Act or with the economy. It does not know how to solve the rest of the problems with national unity. Perhaps this government should just throw in the towel, go to the Canadian public and let them elect a new government. You will see some action on these problems that have been going for much too long. They have been aggravated by this government's policies.
When you talk about the flaws in the Bankruptcy Act, this government will tell you that it has a study group to come in with some comprehensive changes to the Bankruptcy Act. Well, we are waiting. We wait, and wait, and wait.
There have been a number of proposals that have been put forward, but they have all died on the Order Paper. There is only a report recommending that legislation like this be put into place at some future point in time. I am not going to question the sincerity of the hon. parliamentary secretary when he says that we should wait and see with regard to these problems.
I am sure that he would like to see those problems addressed in a new comprehensive reform of the bankruptcy bill. One has to wonder about the government's sincerity. After all, one of the most spectacular bankruptcies that we have seen in recent years is a bankruptcy by Route Canada. Do not forget that it was this government which, in its frenzy toward privatization, sold off Route Canada. It sold it to an individual who could not
November 26, 1990

even get a credit card, for God's sake. They gave it away for about a quarter of what it was worth.
All of a sudden, after the new owner had split the real estate assets off, he declared bankruptcy and threw nearly 2,000 employees out of work. Those employers have been trying to get this government to do the right thing and have a parliamentary investigation through the transport committee. They have not received their moneys yet.
There was a deal that this government had put together with the new owners that offered protection, job security, wage protection to those employees after the sale for, I think, a period of 24 months.
As soon as that agreement expired, this government did not have the good faith to step in, admit that it had sold it to the wrong company, admit that it had made a mistake, and make sure that those workers had the wage and pension protection that they should have.
When the hon. parliamentary secretary gets up and says "trust us", how can we when we have already seen what the government has done to the lives of Route Canada employees. Their lives have been thrown into disarray, some after working for that company for 18 years and 20 years. Perhaps the government opposite is saying: "Wait until we come in, because we are going to come in with a wholesale package that is going to protect workers". It has had an opportunity with Route Canada employees to protect their jobs, to protect the interest of those employees in a company that this government and the people of Canada had owned. It was remiss, and it reneged on that responsibility.
I also have to take a crack at my friends opposite. The member for Nickel Belt is a gentleman who participates greatly in debate in this Chamber. I have no question about where his loyalties lie with the workers of Canada. It is also ironic-and 1 should put it on the record-that, in dealing with the Route Canada employees, just recently the House committee that may look at it made a decision to defer it. There was a motion put forward by the Liberals, and they made that decision.
It is interesting that the New Democratic member for Thunder Bay-Atikokan who was on that committee voted with the government to defer a full investigation as to how Route Canada was sold in the first place and why
Private Members' Business
the interests of the workers were not paramount and looked after by this government. I would only hope that the next time that committee meets an individual such as my friend from Nickel Belt, who does have the interest of the workers at heart, perhaps will represent his party at that table. Then maybe we can see some real progress toward a full investigation of that fiasco.
Reform of the Bankruptcy Act is absolutely essential. Do I have faith that this government is serious about reforming it? No. Do I think that Bill C-217 goes far enough? No, I do not think it does, but it is a start in the right direction because it takes the workers and it puts them in priority so that their sweat and labour get recognized when a company goes bankrupt. That is something that everyone in this House should recognize and should affirm, and the rest of it could come later.
In conclusion, I wish to offer my support of these humble beginnings so that the interest of workers and the equity that they put into a company get recognized when the company unfortunately, like happens many times these days, gets forced into bankruptcy for whatever reason.


Mr. Thompson:: Wind it up. We want to speak on this matter.


Ronald MacDonald: My hon. friend over there has asked me to wind it up. I did not know that he had been made Speaker.
I am very pleased to support this initiative. I would hope that hon. member's opposite will see their way clear to do the same thing.


Mr. Andre Harvey (Chicoutimi):: Mr. Speaker, it is not very encouraging to hear a member of the Liberal Party, which was instrumental in bringing our country to the brink of bankruptcy over a period of 12 years-


Mrs. Maheu:: That's not nice!


André Harvey: -and increasing the debt to $200 billion in just a few years, and which allowed inflation to rise to 13 or 14 per cent and interest rates to 22 per cent, I repeat, it is not very encouraging to hear him criticize the government for its consistent economic policy.

Private Members' Business
Mr. Speaker, regarding the bill before the House today, again sponsored by the hon. member for Nickel Belt, the goverment cannot support a bill that concentrates solely on protecting employees, at a time when it is about to table in the House a bill to amend the entire Bankruptcy Act.
Improving the protection of employees in the case of bankruptcy or insolvency of their employers is a question that our government is looking at very closely, and it is part of a series of measures that it intends to introduce. In fact, the government is finalizing a bill designed to revamp the 1949 Act. The government can hardly be accused of acting hastily, forty-one years later, to bring about substancial reforms.
Granted, employees are often the first to suffer when an employer is in financial difficulty, and the present Bankruptcy Act offers inadequate protection. The inadequacy of the provisions of the present act is readily acknowledged but all parties. Unfortunately, nothing has been done yet to correct this problem.
On May 5, 1975, Bill C-60 was tabled in the House of Commons. It proposed to pay employees in priority to any other creditors, secured or unsecured, up to a limit of $2,000 per employee.
This type of preferential treatment, known as "super priority", would have granted absolute priority of wage claims over any other secured debts.
In its report on Bill C-60, the Standing Committee of the Senate responsible for bankruptcies indicated, however, that granting "super priority" to wages would lead to a serious disruption of the commercial lending system. There are a number of reasons why the super priority clause is not the best way to protect the rights of employees.
First of all, the clause would provide no absolute guarantee of payment of unpaid wages after a company goes bankrupt. In fact, the remaining assets of a company might not be sufficient to cover the amount of wages claimed. Second, this priority would offer no guarantee of speedy payment. In fact, it might take sometime before wage claims could be paid, since the sale and disposition of the assets of a bankrupt company might turn out to be a lengthy operation. Furthermore, the courts would have to settle disputes or clear up certain problems, which might further delay the process. A
super priority clause would not guarantee that employees would immediately get the necessary funds to live on until they find work.
The super priority clause also has a number of serious drawbacks from the administrative point of view, Mr. Speaker. All amounts paid to employees would have to be taken from money owed to secured creditors. The latter, however, also have certain payments that must be met, and they want to be paid. Determining how wage claims would be paid would involve some very complicated arithmetic.
For these and many other reasons, the super priority clause, attractive though it may seem at first glance, is not the best way to protect employees whose employer goes bankrupt. This was acknowledged by the Senate Committee, which, as an alternative, recommended creating, under the provisions of the Bankruptcy Act, a government administered fund that would guarantee payment of unpaid wages as soon as the employer declared bankruptcy.
This formula-an administered fund-seems to have been supported by the government at the time. The then Minister of Consumer and Corporate Affairs, the Hon. Warren Allmand, said: "If it can be justified, after careful analysis, a funded insurance scheme would clearly be the most desirable solution to the problem of indemnifying employees who suffer losses of wages as a result of their employer's bankruptcy"(13). However, no measures were taken at the time. Bill C-12, tabled in 1980, was another attempt to reform the Bankruptcy Act.
In 1981, a committee chaired by Mr. Raymond Landry, the present Dean of the Department of Civil Law of the University of Ottawa and former Superintendant of Bankruptcy, was appointed to find ways to protect employees. In its report submitted in 1981, the Landry Committee recommended setting up a wage protection fund. Despite the recommendations of the committee, Bill C-17, tabled in 1984, basically contained the same provisions with respect to wage earners as did Bill C-12. However, it was subsequently amended to grant priority to wage claims.
Since Bill C-17 died on the Order Paper, we still have the 1949 legislation which, as I said before, badly needs improving if we are to provide adequate protection for employees.
November 26, 1990

The bill before the House today, like the other bills sponsored by the same member, including C-249, tabled in February 1987, would extend the protection granted to unpaid wages to contributions paid or deemed to have been paid into a pension fund. Although the concept as such is indeed praiseworthy, the financial impact of such a provision might well prove to be extremely severe, and would probably lead to even greater credit restrictions, especially in economic sectors that are highly labour intensive.
Finally, Mr. Speaker, I would like to point out that the mechanisms we choose to protect employees in case of employer bankruptcy must not affect the ability of Canadian businesses to compete on international markets. In fact, with the present globalization of markets, it is imperative that protection mechanisms do not, as might well happen with the super priority which is the focus of Bill C-217, impede business financing and as a result impair the efficiency and competitive potential of our businesses. If businesses cannot develop as they should-and they are the motor of our economy-the result is fewer jobs, which means that in the end employees are the ones who suffer.
In concluding, Mr. Speaker, these were the reasons why Bill C-217 cannot be supported by this government as well as the main points of the bill the government intends to table early next year.


Gregory Francis Thompson: Mr. Speaker, it is a pleasure to speak on Private Member's C-217.
Going back and looking at from where the bill comes, the member proposing it and the party he represents, I think we have an understanding of what he is attempting to do. We do not disagree with that. The difficulty obviously is that they do not understand the complexity of legislation and the net effect it will have on our business community.
None of us will disagree with what he is telling us and what he is proposing should be done, but it is much more complex than that. The member for Nickel Belt mentioned in his speech an elephant gestation period of nine years. In response to that, they have been around here
Private Members' Business
for about 40 years and have yet to conceive. If they hang around long enough possibly they will deliver, but at this point I do not think we are going to have to worry about it. There is no question they have not taken the time to read thoroughly what they are suggesting. If they did so, they would change some of what they are saying.
One of the problems obviously when a firm goes bankrupt is the little people, the people who carry lunch boxes, the ordinary worker. All of us want to see those people protected. However, in a much broader and much bigger picture, obviously we need factories and places of business for those people to enter to work. We all want them to get paid, but what they are proposing goes beyond that. They are taking a look at super priority for workers; in other words, being at the head of the bus, as the member for Nickel Belt pointed out, in terms of getting their wages.
We do not disagree with that. However, what that is going to do is throw a few other elements into the equation which they have not considered, one of them being the fact that trustees have to be appointed. At some point trustees have to receive payment for their services to ensure that the business is liquidated and that other creditors are paid, including the workers. If there is no trustee there to do the job, no one gets paid. Members of the NDP have not considered that.
The other thing they have thrown at us is the fact that there should be an onus, a responsibility on the backs of the banks to make sure that employees are paid. I guess none of us would disagree with that either, but the difficulty obviously is if that is the way it is done in every business that goes bankrupt, investment in that business will be stifled from day one. Obviously banking institutions and others will take a hard look at where they want to put their dollars if they believe that they are going to be the last to be paid.
The secret to the whole thing is a healthy economy, and that is what we have had for the last six years. We have been number one or number two in the world for
the last six years.


The Acting Speaker (Mr. DeBlois):: Order, please. It being two o'clock p.m., the House will now proceed to Statements by Members, pursuant to Standing Order 31.



[Stage Direction]
TRIBUTE TO PASCALE LEFRAN£OIS
Mr. Guy Saint-Julien (Abitibi):: 
Mr. Bob Kilger (Stormont - Dundas):: Mr. Speaker, the efforts being made to obtain National Hockey League franchises for the cities of Ottawa and Hamilton deserve the support of all members of this House.
I would like to commend my colleague from London- Middlesex for forming the national hockey caucus of parliamentarians who support the application for NHL franchises in these two cities.
Hockey is an integral part of Canada's cultural and sport heritage and is a unifying factor in our country.

Mr. Speaker, I have close contacts with the world of hockey. Throughout my ten years as a National Hockey League official, a time during which Quebec city, Winnipeg, Edmonton and Vancouver joined the NHL, I was able to see personally to what extent a new franchise contributes to a municipality, its residents and their economy.

Mr. Speaker, I would like to offer my wholehearted support to those involved in bringing the National Hockey League to both Hamilton and Ottawa.


GOVERNMENT EXPENDITURES
Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, at a time when Canadians want peace rather than war, want social and environmental security, not arms, this government instead, with the excuse of the gulf crisis, cuts spending allegedly to finance a war effort, but in reality to finance the implementation of the general sales tax. As a result, the government cut $14 million from the budget of Environment Canada and $24 million in environmental grants and contributions.
Canadians, who are on the side of peace, are asking why the environment and other important measures are being sacrificed to protect American dependency on foreign oil and implement the hated general sales tax. What a disgrace, Mr. Speaker.


CONFLICT OF INTEREST
John R. Rodriguez: Mr. Speaker, recent events in Alberta, where the premier was caught in a clear conflict of interest, shows the need for effective conflict of interest rules for members of Parliament and senators.
At this point in time, we have senators who are tied very closely to the financial institutions of the country. It seems to me these same senators are participating in passing legislation such as the deregulation of financial institutions, selling shares in Petro-Canada, Hibernia handouts, not to mention the hundreds of private contracts that go out in the name of government every day.
The temptation is there for these foxes to get in because there is no fence around the chicken pen. The Prime Minister still has not learned his lesson. When it comes to guarding the chicken coop this government has once again left it in the hands of the foxes.
This government made a commitment not once, but twice, to bring in new legislation to keep conflict of interest out of government. We still do not have any effective rules safeguarding against conflict of interest by
November 26, 1990

members of Parliament and senators. This is not right. We must have conflict of interest regulations now.
The Prime Minister need only take a look at the example set by his friend, the premier of Gettysburg, to know that this problem needs to be addressed-


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

[Translation)


EPILEPSY AWARENESS MONTH
Mr. Charles-Eugene Marin (Gaspe):: This year, Mr. Speaker, November has been chosen as the month to make people more conscious of epilepsy. Epilepsy Canada and the various associations included in this organization have made concerted efforts throughout the month to help Canadians become more familiar with this neurological illness.
Current statistics put at roughly 400,000 the number of Canadians suffering from some form of epilepsy, a far higher percentage than in the case of any other neurological disorder. Today, appropriate care and treatment enable many people to lead a normal and productive life, yet about half of epileptics continue to be the victims of uncontrollable seizures.
Strange though it may seem, our so-called advanced society still nurtures myths and false conceptions with respect to epilepsy. Some people hesitate to admit they are subject to epileptic convulsions because they fear losing their job, their friends or their status. Discrimination and rejection still cause problems at school, at work and in society generally.
Mr. Speaker, let us hope these people will soon be openly accepted by their fellow citizens.


NORTHERN TAX BENEFITS
Mr. Rod Murphy (Churchill):: Mr. Speaker, on behalf of the New Democratic caucus again I would like to raise the issue of a northern tax benefit. I would like to point out that it is our caucus, the New Democratic caucus, which has raised this issue more often in the House than the other two parties and/or the independents.
I would like to bring to the attention of the Minister of Finance that the Christmas season and the new year are fast approaching. The people of thousands of northern Canadian communities are living with uncertainty because of the impending elimination of the northern tax benefit to their communities effective this January.
The Minister of Finance has had a task force report on northern and isolated areas in his hands for over one year now and has not announced what he will do with regard to this issue. The government has a responsibility to act immediately. It is a shame that some Canadians will face the new year and the holiday season with this uncertainty about their financial situation. It is a disgrace that these Canadians have had to wait as long as they have for action.
Once again, I call upon the government to reject their flawed task force report and implement a fair taxation system for Canada's northern and isolated areas.


FISHERIES
Mr. Peter L. McCreath (South Shore):: Mr. Speaker, this morning saw 2,000 lobster fishermen from Nova Scotia districts 33 and 34 heading out to set their traps for the first day of the lobster season. We wish them safety and a full harvest.
The lobster industry in Nova Scotia brought some $69 million this year, up $3 million from the year before. While prices were low, catches, particularly in western Nova Scotia, were high.
The recent lobster dispute with the United States has created some uncertainty with respect to prices and markets for the immediate future. In response to the express wishes of a significant majority of Nova Scotia lobster fishermen, the government rejected the recently negotiated lobster agreement with the United States. I commend the government for listening to and acting upon the wishes of the people most directly affected.
This morning a 40-knot gale greeted the lobster fishermen as they headed out with their traps. We pray they all return safely. To greater enhance the possibility of this in the future, perhaps the government should consider providing fisheries officers with some flexibility in opening dates to accommodate the exigencies of the North Atlantic's November weather.

November 26, 1990


GOVERNMENT EXPENDITURES
Mr. Stan Keyes (Hamilton West):: Mr. Speaker, the lessons of Thatcherism are lost on the Prime Minister. While support for the PM and his party are at new lows the cutting, slashing and privatization continues unabashed.
The government has used the Persian Gulf crisis as a convenient excuse to slash $350 million from key federal departments. Let us be honest here, Mr. Speaker. We pay for the ships and crew whether they are in Canada or in the Persian Gulf. In fact, it may cost the government far less while the ships and crew are in the gulf.
Employment and Immigration will lose over $25 million which will not only cut language training programs for recent immigrants but will further clog the refugee backlog process.
As well, the Canadian Centre for Occupational Health and Safety will be receiving $80,000 less than expected. Although my private members' motion calling upon the government to reinstate full funding for the CCOHS was adopted last spring, the Minister of Labour has chosen to ignore Parliament and to fast-track privatization.
Mr. Speaker, the Prime Minister says that Canadians have never looked for a free ride. I say the only free ride has been the one taken by the Prime Minister in his rule by decree. Any Heseltines over there?


NEW DEMOCRATIC PARTY
[Stage Direction]
Mr. Dave Dingwall (Cape Breton-East Richmond).
Mr. Speaker, the NDP are at it again.
Some hon. members:: Oh, no.


Mr. Dingwall:: It was reported over the weekend that the leader of the New Democratic Party stated: "We are a federal party". Yet the NDP's only Quebec member of Parliament, the member for Chambly, tabled a brief before the Belanger-Campeau commission that favoured a form of sovereignty association, not federalism.
Once again the NDP, the no direction party, has an exposed difference of opinion between its leader and its backbench.
Mr. Speaker, I sometimes like to compare the NDP to a ship, rather than an organized political organization, because we all know a ship makes the most noise when it is in the fog. Here we have the NDP, not only in the fog but drifting without a political hand at the helm. Canadians want sound, solid and sensitive answers to the country's problems and we in the Liberal Party of Canada can provide that direction.


THE GREY CUP
Mrs. Dorothy Dobbie (Winnipeg South):: Mr. Speaker, yesterday Canada watched the Winnipeg Blue Bombers march with unflagging energy to defeat the Edmonton Eskimos 50-11 for a stunning Grey Cup victory.
Today's Ottawa Citizen has it right with a one-word headline on its sports page "Winner-peg". Winner-peg is the pretty city of the prairies that knows how to do things right and next year the heat is on for the biggest, the best, the hottest Grey Cup in the history of the Canadian Football League.
Congratulations Winnipeg and congratulations Bombers. As Michael Gray says: "There is nothing like a little smoked ham at Thanksgiving".


LILLOOET LIBRARY
Dave Worthy: Mr. Speaker, my fellow members will recall that in March of this year, a fire in my constituency totally destroyed the town of Lillooet's only library.
I am pleased to report that the response to our appeals to other communities, publishers, and libraries was overwhelming. Most impressive, however, was the response from my fellow members of Parliament. The original centre's construction, as is the case in so many small towns, was a community effort. I am pleased to acknowledge that my colleagues in the House and their staffs united in a community effort of their own, providing the library with a base of some several thousand books upon which it can now build. Considering the diversity of the donors, Lillooet can now lay claim to a truly unique catalogue.

November 26, 1990

On behalf of the people of Lillooet, I would like to extend heartfelt thanks to all members of the House, from all parties, for their support.


FORESTRY
Mr. J. W. Bud Bird (Fredericton-York-Sunbury):: Mr. Speaker, I would again like to draw the attention of all the hon. members to the forestry subcommittee report entitled Forests of Canada, the Federal Role, which was tabled in this House two weeks ago.
The words "sustainable development" were first used in federal legislation in Canada to help create the new Department of Forestry with Bill C-29 which became law in February of 1990.
The forestry subcommittee report proposes a practical process by which the federal government can help lead the implementation of sustainable development in forestry in this country to translate that concept into reality on the ground and in the forest. As the report states, that should become the mission for the new Department of Forestry. The forests of Canada must not be taken for granted. They are pillars of our nation's prosperity and they constitute the very essence of our environment.
If sustainable development is ever going to be practised successfully in Canada, it must begin in our forests.
I urge every member of this House to read the forestry report and to help promote its proposals and purposes.


SHIPPING
Mr. Nic Leblanc (Longueuil):: Mr. Speaker, the brunt of the government's cost recovery policy for the Coast Guard will be borne by St. Lawrence shippers who will have to foot the bill. Once again, the federal government is leaving Quebec with a bill that in the medium and long term will financially drain the shipping industry in Quebec. The Coast Guard cost recovery project is unfair to Quebec. If the minister thinks we are going to stand aside while this happens, I can assure him that we intend to watch developments very closely.


THE GREY CUP
Mr. Rey Pagtakhan (Winnipeg North):: Mr. Speaker, yesterday's 78th Canadian Football League Grey Cup Game created new records. The Winnipeg Blue Bombers cruised to a 50-11 victory-their second championship in three years, with a 28-point third-quarter outburst-a record in any Grey Cup game, led by the second longest interception return in Grey Cup history-56 yards.
I salute the Bombers for a great performance. A special salute goes to Warren Hudson-the outstanding Canadian, Tom Burgess-the outstanding offensive player, and to Greg Battle for the twin honours-the game's and the league's top defensive player of 1990.
Indeed, Manitobans have special reasons to celebrate yesterday's event. May we, in Parliament, and all Canadians pay tribute to the Winnipeg Blue Bombers for a unique display of team work and a one of a kind Grey Cup victory.
Let us continue to support the CFL for a distinctively Canadian game and as a source of Canadian pride.


GUN CONTROL
Mr. Ian Waddell (Port Moody-Coquitlam):: Mr. Speaker, the Minister of Justice has been sabotaged by her own back-bench on a major piece of legislation, the gun control bill.
Last week, she was forced into the humiliating spectacle of filibustering and blocking her own bill. Her only other significant act in her tenure so far-other than calling my colleague, our House leader, cute-is the recriminalization of abortion, which she professes to oppose.
It is almost a year since the massacre of 14 young women at the Ecole Polytechnique in Montreal and six months since the Minister of Justice promised its students action on gun control, a promise now betrayed. To think that just a month ago, some journalists were talking about the minister as a possible successor to Mr. Mulroney. They should look again at this record of

Oral Questions
incompetence, defeat and lack of political will, especially on abortion and on gun control.



ORAL QUESTION PERIOD


Hon. Herb Gray (Leader of the Opposition):: Mr. Speaker, my question is directed to the Minister of Finance.
Last Friday, the government tabled supplementary estimates in which it tried to use the Persian Gulf crisis as a smoke-screen to hide its own economic mismanagement. An example of this mismanagement lies in the numbers for the government's plans to implement the GST.
Last month, the Minister of National Revenue said that the government will be spending $260 million to bring in the GST. But if we look at the supplementary estimates tabled last Friday, we will find the government intends to spend, not $260 million, but more than $380 million just in this fiscal year, until the end of March alone.
Why will the Minister of Finance and the government not admit that they have no idea just how much it is going to cost to bring in this unfair tax? Why will the government not listen to Canadians and scrap this tax, before it wastes millions more of taxpayers' dollars trying to get ready for a tax that Canadians have said over and over again they just do not want?


Some hon. members:: Hear, hear.


Hon. Otto Jelinek (Minister of National Revenue):: Mr. Speaker, it is obvious that the Leader of the Liberals in the House does not know the difference between apples and oranges. That is precisely the type of arithmetic that he is using to try to establish the cost of implementing and preparing the GST.
There are two levels of additions to be made: one for the collection and administration, and one for the preparation and implementation. The figure that I quoted last month was that I was estimating $260 million
for costs this fiscal year for the preparation and administration of the GST.
The supplementary estimates confirm that that figure, in fact, is going to be $257 million. When he adds in social services, such as social benefits which will be accrued to some eight million Canadians who will receive the GST credits, then of course the figures are larger.
Is the member suggesting that social elements of the GST are the same as administration and preparation? Is he against the GST credits? If he is against the GST credits, he should stand up and say so.


Herbert Eser (Herb) Gray: Mr. Speaker, my supplementary question is directed to the Minister of National Revenue.
What he just said is another example of this government's tortured logic. It wants to have Parliament approve the spending of another $108 million to help send out rebate cheques to some of the thousands of Canadians who are going to be clobbered by this unfair GST.
Does the Minister of National Revenue not realize that these rebate cheques would not be necessary if the government was not proceeding with the GST? All these rebate cheques do is try to make up for just some of the negative effects of this unfair tax.
I ask the minister to answer this question on behalf of the government once again: Why will the government not come to its senses and drop this unfair tax?


Some hon. members:: Hear, hear.


Hon. Michael Wilson (Minister of Finance):: Mr. Speaker, the Leader of the Opposition talks about people being clobbered by this tax.
Let me remind him that when he was in the government, there was no GST credit. There was no refundable sales tax credit. People in low income brackets paid indirectly through the price of the products that they bought. They paid sales tax and they got no credit for it.
The result was that people with low incomes paid three or four percentage points more of their income in sales tax than those in upper income brackets.
The result of the GST credit is that will be reversed. People in low income brackets will pay two or three

November 26, 1990

percentage points less as a per cent of their income than people in upper income brackets. That is why we say the GST is a fairer tax.
If he wants to talk about people being clobbered by sales tax, they were clobbered by sales tax when he was in the government.


Herbert Eser (Herb) Gray: Mr. Speaker, there would be no tax on haircuts without the GST, there would be no tax on muffins, there would be no tax on popcorn, and there would be no tax on funerals. No wonder the government's funeral is being brought about by this GST.

Mr. Speaker, according to the Supplementary Estimates, the government intends to waste another $14 million on a propaganda campaign for its own GST. I want to ask the minister why his government wishes to undermine the freedom of thought of Canadians by taxing books, when it has no scruples about promoting its own GST and docs so without regard for the cost to Canadians.


Michael Holcombe Wilson: Mr. Speaker, it is no surprise that the Leader of the Opposition is using these questions as a diversion from what is going on in Canada today.
There is a poll of Canadians done by Angus-Reid which said that respondents do not believe Liberal Leader Jean Chretien's promise to kill the tax if his party forms the next government. Sixty per cent of Canadians do not believe the Leader of the Liberal Party of Canada. Sixty per cent of Canadians say if he comes in-


Some hon. members:: Oh, oh.


Michael Holcombe Wilson: Mr. Speaker, 70 per cent believe that we are going to have this GST in place, so they believe what we are saying.
We are committed to the GST, but for good reasons. We are committed to the GST because it is going to help our exporters. It is going to put Canadian companies on a level playing-field with imports when imports now pay one-third less tax. It will result in a reduction of the cost of new investment of 4 per cent for all of Canada and, for those provinces that harmonize, 7.5 per cent.
Oral Questions
There are good, solid economic reasons why we are bringing in this tax, in addition to the fairness that the GST credit will bring to low-income Canadians. Those are the reasons why we are going to bring in this tax.


Some hon. members:: Hear, hear.


PERSIAN GULF
Mrs. Christine Stewart (Northumberland):: Mr. Speaker, last month the House passed a motion on the gulf crisis condemning the Iraqi invasion of Kuwait and affirming Canada's support of the UN approved multinational military effort enforcing sanctions against Iraq. At the time, the Secretary of State confirmed to us in correspondence that the government agreed to bring Parliament into debate on any change in our countries involvement in the gulf.
The government benches are quite empty today, but I wonder if a minister in the name of the government will immediately guarantee that parliamentarians will have the opportunity to debate the present gulf situation before Canada votes on a new resolution this week?


Some hon. members:: Hear, hear.
Hon. John C. Crosbie (Minister for International
Trade): Mr. Speaker, this Parliament has had an opportunity to debate the gulf situation and, of course, the opposition can always bring forward a motion for a debate on the gulf situation any time it wishes.
With respect to any other debate on the gulf situation, I will pass on to the Secretary of State for External Affairs the member's suggestion. He will announce on behalf of the government whether or not that is a request that can or should be acceded to later in the week.


Christine Susan Stewart: Mr. Speaker, Canada holds the position at the UN Security Council of vice-chair of the Gulf Sanctions Committee.
In order that Parliament could have a debate, and in order that parliamentarians and the Canadian public can evaluate the effect of sanctions, will the government immediately provide the House the fullest possible documentation concerning the history and effectiveness of the Iraqi sanctions to date?


Some hon. members:: Hear, hear.

November 26, 1990
Oral Questions


Hon. John C. Crosbie (Minister for International Trade):: Mr. Speaker, I am quite sure that the Secretary of State for External Affairs is quite prepared to make available to the House, or to the Standing Committee on External Affairs, the full information on how effective the sanctions policy appears to be.
With respect to the Gulf situation generally, the House knows that the government is giving its full support to the concept of collective security with respect to the events in the Gulf and the invasion of Kuwait by Iraq. We intend to continue with that policy and to support those people who believe that together, collectively, we have to protect the security of all countries in the world, certainly countries that believe in the UN and support the United Nations system.


Ms. Audrey McLaughlin (Yukon):: Mr. Speaker, my question is directed to the Acting Prime Minister. There are reports today that the United States will seek a UN resolution setting a deadline for war and ask for the support of the United Nations for that deadline.
On October 26, the Secretary of State said that he would entertain a full debate in the House, if there was time, on the Gulf crisis should conditions change. They appear to be changing, at least at the urging of the United States. This weekend, the Secretary of State for External Affairs said that, while he personally might have some disagreement with setting a deadline for war, Canada would probably support that proposition. Surely, if the minister responsible is to go against his conscience, it shows how much we need this kind of parliamentary debate.
Will the government support the New Democratic motion for an emergency debate on this situation?


Some hon. members:: Hear, hear.


John Carnell Crosbie: Mr. Speaker, the House has already debated a resolution in connection with the Gulf crisis. The policy of the government is a policy of supporting the nations of the world in the concept of collective security.


An hon. member:: We are talking about war now, John.


John Carnell Crosbie: As far as war is concerned, war was an act that was instituted by Iraq as a country when it invaded Kuwait some months ago.
The government is not planning any declaration of war, but it is planning full support to the United Nations and to our allies with respect to a responsible approach to this crisis. It is a crisis that threatens every country in the world which might have a powerful nation living next to it, a nation which in the future might covet its territory.


Some hon. members:: Hear, hear.


Audrey Marlene McLaughlin: Mr. Speaker, the government clearly has not been able to tell the House what period of time it supports to see whether economic sanctions will be affected. The Secretary of State for External Affairs has said that his government would support a resolution, even though he may be in disagreement that we should be specifying a time where offensive action would be taken. Surely, circumstances have changed. We have not debated this in the House of Commons. We have debated the economic sanctions.
Again, will the Acting Prime Minister commit his government today to debate the UN resolution that will be coming up later this week, before that resolution comes up and before the government commits Canada to an action that has not had full democratic parliamentary debate?


Some hon. members:: Hear, hear.
Hon. John C. Crosbie (Minister for International
Trade): Mr. Speaker, the offensive action that was taken was the offensive action of Iraq invading and taking possession of Kuwait, by force of arms, without any warning, and without any justification, several months ago. That is the offensive action.
The government is clearly against that and it is going to support the countries of the world who are united in their condemnation of those acts. We will support whatever action is necessary so that Kuwait can be restored to the status quo ante.
With respect to a request for a debate, that is a matter, as I have said, that I will pass on to the Secretary of State for External Affairs who is presently travelling in the area, doing his best to ensure a Canadian presence there and to support those countries that have been adversely
November 26, 1990

affected by these unprovoked and war-like actions of the country of Iraq.
I will pass on to him these requests. They will be dealt with when he returns.


Audrey Marlene McLaughlin: Mr. Speaker, the minister responsible for external affairs has indeed been travelling around making very inflammatory remarks, which may in fact have put the Canadian hostages at risk, just when it seems that the whole parliamentary committee is making some kind of progress.

Mr. Speaker, last Friday, the government cut its budget allocations for workers, social services, the environment, fishermen and veterans. The government said it was because of the gulf crisis, but according to a survey, the increase in the price of oil will result in more than $1 billion of revenue for the federal government. Furthermore, it is estimated that oil companies will be able to increase their profits by $5 billion annually. Why should Canadians who are least well-off have to bear the brunt of the gulf crisis?


John Carnell Crosbie: Mr. Speaker, it is not remarkable and, of course, it is to be expected that the Leader of the New Democratic Party will always take a simplistic approach to whatever problems may arise in the world.
With respect to the Secretary of State for External Affairs, he has just visited Jordan and Egypt where he has announced that we are providing $26 million in assistance to Jordan and $25 million in assistance to Egypt, along with $13 million in debt write-offs for previously granted development aid to assist those countries because of the position they have been put into by the aggressive actions taken by Iraq.
The Secretary of State for External Affairs has expressed the policy of this government clearly and succinctly. The policy of this government is not going to change, no matter what position is taken with respect to the Government of Iraq, with respect to hostages who they should not have taken in the first place. We have no
Oral Questions
intention of altering our policy of assisting in a collective response to Iraqi aggression. That is a policy we are going to continue firmly and decisively in the future.


THE ECONOMY
Mr. Jim Peterson (Willowdale):: Mr. Speaker, last Friday, the President of the Treasury Board said in this House: "Liberal members are certainly not helping by saying constantly that things are going awfully bad. I wish to warn him against constantly making negative and pessimistic statements which do not reflect the reality." Let me try just a little slice of reality.
Record bankruptcies have devastated our manufacturing sector; there are 216,000 fewer jobs than a year ago; our economy is in recession and, last Friday, the government announced an accounting error of $4.5 billion.
All Canadians are anxiously awaiting the good news. When will the minister end the suspense?


Hon. Gilles Loiselle (President of the Treasury Board and Minister of State (Finance)):: Mr. Speaker, the hon. member for Willowdale spent most of his weekend talking about a $4.8 million error. That is not the case.
I refer him to documents tabled and discussed in this House, the Main Estimates, in which we indicated that we were setting aside reserves of $2.6 billion and that we were expecting a lapse of $1 billion. This is not an accounting error. This is good management.
On program expenditure we were threatened with an over-spending of $350 million. Instead of pushing it on the deficit as the Liberals did for so many years, we made an additional effort to try and finance it from within. We are still on target, as my colleague, the Minister of Finance, said in September, of $106 billion for program expenditure, and not more.


James Scott (Jim) Peterson: Mr. Speaker, it is fantastic economic management that the government underestimated the deficit by $2.5 billion.
On Friday, the President of the Treasury Board defended his government's record in terms of the underestimation of costs, in terms of its high interest rate recession-causing policies, when he defiantly declared: "We will stay the course."

Oral Questions
How many more Canadians must lose their homes, their jobs, their farms and their businesses under this government's devastating economic mismanagement?


Michael Holcombe Wilson: Mr. Speaker, when the hon. member leads with his chin in this way, we have to bring out some of the facts relating to the last few years of the Liberal administration.
In 1982-83, the projection of the deficit was $10.5 billion. It was revised in June to $19.6 billion. It was revised again in October to $23.6 billion and the final outcome was $27.8 billion, a full $17.3 billion over estimate. That was equivalent to 20 per cent of total spending at that time.
What my colleague and I have been saying on many occasions is that it is important for us to manage far, far better than that, and we are, because the $1.5 billion increase in the deficit this year is equivalent to less than 1 per cent of total spending.
The reason it is important to maintain this good spending record is to ensure that we maintain the confidence of the markets. I see members opposite are laughing. They are willing to compare their record where it was $17.3 billion or 20 per cent over the total spending. That was the amount of the error. I know what they are laughing at. They are laughing at the record of the administration when the Leader of the Opposition was the President of the Treasury Board.


Mr. Francis G. LeBlanc (Cape Breton Highlands- Canso):: Mr. Speaker, my question is directed to the Minister of Finance. No region has paid more for his government's misguided, high interest rate and high dollar policies than Atlantic Canada. We have paid through lost exports and lost jobs. We have lost our trains. We have lost CFB Summerside. Now, for $150 a plate, the minister tells the last 175 Tories in New Brunswick that we must pay $21 million more in cuts to ACOA to get lower interest rates and a lower deficit.
Why will the Minister of Finance not wake up to the fact that it is his interest rate policy that is causing the deficit and stop punishing Atlantic Canada for his own fiscal incompetence?


Michael Holcombe Wilson: Mr. Speaker, the point I was making in response to a question I was asked in New Brunswick last week was the same point that I just made to the hon. member's colleague, that we have to manage our expenditures well
here. We have to manage our deficit position well. If we can get our deficit down, we will be able to get interest rates down, and that is the primary objective of the initiatives that were announced on Friday by my colleague, the President of the Treasury Board.
All Canadians, including those in Atlantic Canada, will enjoy the benefits of lower interest rates if we are able to get the deficit down. There is simply a shifting of expenditures on ACOA from one year to others. There is no loss of those moneys. They will be spent in Atlantic Canada. It is just a question of different timing and the result will be part of a broader effort to keep our deficit under control.


Francis G. LeBlanc: Mr. Speaker, after that answer, I would suggest that those Tories ask for their money back.

Mr. Speaker, my supplementary is directed to the minister responsible for the implementation of the Atlantic Canada Opportunities Agency Act. The minister knows that the Atlantic region is already in a recession, that we have the highest unemployment rates in Canada and that the GST will hit us harder than anyone else in Canada, except perhaps in the North. He knows this is the worst time to cut regional development programs. Why, as the minister responsible for ACOA, did he accept these cutbacks?


Hon. Elmer M. MacKay (Minister of Public Works):: Mr. Speaker, I can understand the concern of my hon. friend opposite. Surely he must have paid attention to the reply of the Minister of Finance which summed up the situation accurately. ACOA has not lost its capacity to deal with economic and regional development. We have absorbed a cut, as well we should, to help with other contributions in reduction on our O and M, operations and management. Our capacity to respond to the mandate that ACOA has in Atlantic Canada has not been affected.


GOODS AND SERVICES TAX
Mr. Lome Nystrom (Yorkton-Melville):: Mr. Speaker, my question is for the Minister of Finance.
November 26, 1990

I have here a copy of Friday's briefing notes to the cabinet ministers in terms of the supplementary estimates, the notes that the Minister of Finance and others had on Friday. In here we have 10 pages of briefing notes and 25 questions and answers suggested for the ministers in areas dealing primarily with the GST, cut-backs, and the military.
I do not have time to refer to many of these, but I want to ask the Minister of Finance if he can be frank and honest with the Canadian people and tell us what the cost of administering and setting up the GST will be in light of the fact that among other questions, question No. 4 says: "What are the ongoing costs of implementing the GST?" The suggested answer is: "Once legislation is approved, we will be reviewing departmental requirements for this year and the availability of funds in existing appropriations. If additional funds are needed, they will be included in further supplementary estimates".
In light of that, Mr. Speaker, are we to expect even further supplementary estimates for the GST? Can the minister now be frank, open and honest with the people of this country and tell us exactly how much it will cost to set up and administer the GST, or do I have to read the rest of his notes into the record?


Otto John Jelinek: Mr. Speaker, the hon. member can read any note into the record that he wants. He will know that in so far as the proposed costs for the GST are concerned, we have been open right from the start about what the costs are going to be.


Some hon. members:: Oh, oh.


Shirley Maheu: So
far.


Otto John Jelinek: This member is a member of the Standing Committee on Finance where, on March 13, I gave the estimate officially as to what the costs were going to be for the GST for the preparation and planning. That figure which I gave to the finance committee was $300 million. I am happy to note that the cost for that is below $300 million.
If the hon. member is talking about collection and administration, that has been stated in the finance minister's budget papers of earlier this year, and we are on budget and on target on those. I have been open and
Oral Questions
honest with everybody, as were all my other colleagues. I can tell the hon. member that we are on track and on budget.


NATIONAL DEFENCE
Mr. John Brewin (Victoria):: Mr. Speaker, on the same subject, the same briefing notes say in respect of National Defence expenditures that National Defence had been planning to absorb the 1989 and 1990 budget reductions through a series of internal measures, but it goes on to say that now that the gulf situation has come about, we can squeeze in these items under the heading of the Persian Gulf expenditures. In fact, when one looks carefully at the notes that were provided the public on Friday, it becomes very clear.
Of the $121 million in capital expenditures for equipment, only $21 million are for the gulf and over $100 million expenditures are for "the advancement of previously planned military equipment purchases". Will the minister explain to the House what planned expenditures are being advanced, exactly what these funds are going for, why over $200 million is not going to the gulf at all but in fact going to enhance the Department of National Defence?


Hon. Bill McKnight (Minister of National Defence):: Mr. Speaker, I guess I should not be surprised at the member's mathematics after hearing him on the weekend say that he was informed the cost in the gulf was $1.3 million a month, which included rental for some accommodation and some dry cleaning for forces stationed there. He should have paid a little more attention to the briefing and the information we provided not only to the members, but to the media.
If he takes a look, he will find that there is $121 million for capital. I said on Friday that a major portion of that was under commercial negotiation by the government to acquire additional capital assets that we need at this time.
The member asked for what purpose. I can inform him that it is for the general military preparedness of Canada because we have a very serious situation. Because the government-and I am sure it is supported by the hon. member and his party-has put men and women in the Persian Gulf region, the government believes that they should be sustained and supported.

November 26, 1990
Oral Questions ALGOMA STEEL


Mr. Maurice Foster (Algoma):: Mr. Speaker, my question is for the Minister of Employment and Immigration.
The strike at Algoma Steel in Sault Ste. Marie was settled over a week ago, involving some 6,000 employees and having a devastating impact on the community.
Because only 1,000 employees have been called back to work so far and because of the estimates of reinstatement of jobs, it is estimated that most employees will not receive any UIC benefits until the end of December of this year.
What is the minister going to do about this travesty of justice to ensure that cheques are sent out to these employees who have been on strike for over four months.


Hon. Barbara McDougall (Minister of Employment and Immigration):: Mr. Speaker, the rules that are being applied in the Algoma situation, which has been a long and unfortunate one, are the same as the rules that are applied in other situations.
The Algoma management has confirmed with my officials that something like 2,000 workers will be recalled in the next two or three weeks. To expedite claims, our officials in Sault Ste. Marie have set up temporary headquarters in the union hall to assist with claims and are planning to register all workers who will need unemployment insurance as efficiently as possible.
This is the normal procedure within UI in events like this.


Barbara Jean McDougall: Mr. Speaker, I think the hon. member knows that this is not something the minister can simply wave a magic wand over.
Forty years of jurisprudence have gone into these kinds of decisions. We have asked our officials to work as efficiently as possible within the parameters of what we have to do. We will be getting the money to them as soon as possible.


RADIO CANADA INTERNATIONAL
Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, over $10 million in cultural cuts were announced Friday allegedly to pay for our military exercise in the Persian Gulf.
On August 13, the CBC extended its international voice in Arabic to the Middle East, bringing messages from a western middle power.
My question for the President of the Treasury Board. At this time of crisis, with the citizens of Iraq and Kuwait isolated to Saddam Hussein's message, does the minister agree that Radio Canada International is vital to Canada's pursuing peace with these people, as well as a key voice to our Armed Forces? Is this not an important role for Canada and Canada's national interest?


Hon. Gerry Weiner (Secretary of State of Canada and Minister of State (Multiculturalism and Citizenship)):: Mr. Speaker, CBC Radio-Canada is an independent society. It is an independent, arm's length body that functions in a completely independent fashion. I imagine it will make-


Maurice Brydon Foster: Mr. Speaker, I have a supplementary question.
Surely the minister cannot hide behind the unfair regulations and the UIC act. Thousands of families in the Algoma district face a Christmas without money unless the minister acts now.
I wonder if the minister would use the discretion she has under the act and the regulations to order that cheques be sent out immediately.


Some hon. members:: Come on, give us an answer.


Gérard (Gerry) Weiner: I will, if you let me try. I imagine that when the expenditure reduction was applied in an equitable fashion, there was a sharing by all of us. The CBC will indeed determine what its priorities are and continue to offer the same high quality service it always has.


Sheila Finestone: Mr. Speaker, the President of the Treasury Board, had he cared to answer this question, knows perfectly well that he controls the funds.
**
November 26, 1990

In controlling those funds, the President of the Treasury Board controls the program, so don't try to hide behind arm's length in this circumstance.

Mr. Speaker, this government is responsible for cutting the CBC budget right down to the bone by reducing corporate appropriations to the tune of more than $240 million and forcing management to slash legitimate outlays to the extent that the future of some services is in doubt. My supplementary is directed to the President of the Treasury Board. Does he not think that Radio Canada International has to know today that the necessary funds will be set aside just so it will survive? Yes or no?


Gérard (Gerry) Weiner: Mr. Speaker, I want to point out that our government has done all it could to maintain the funds required by the CBC to fulfill its mandate. Being one of its supporters I can tell you quite frankly that I have always been satisfied with its excellent service. The CBC management now has to deal with some restrictions, but I am sure it will continue to provide outstanding services.


OIL INDUSTRY
Mr. Steven W. Langdon (Essex-Windsor):: My question is for the Minister of Finance, Mr. Speaker
As my leader stressed, economic forecasts show that the oil industry in Canada will make an extra $5 billion in profits next year from the gulf crisis, as a direct result of that. In fact, Statistics Canada has just reported an increase of $600 million in petroleum products profits in the third quarter alone.
Will the minister see to it that these super profits pay the cost of the blockade in the gulf instead of cutbacks in programs for people across this country?


Michael Holcombe Wilson: Mr. Speaker, as my friend already knows, we have made significant changes to the taxation of corporations, with the result that there will be significant tax revenues
Oral Questions
coming from the additional profits that the oil companies will be making with the increase in the price of oil. He can be assured that those moneys that will accrue to the Consolidated Revenue Fund will be applied in the appropriate way. One of those ways will be to help finance a variety of programs in a variety of ways.


Steven W. Langdon: Mr. Speaker, the Minister of Finance makes an important point. The estimates which have been undertaken by Informe-trica, for instance, suggest that indeed the government will get an extra $1.1 billion in revenue as a consequence of the oil price increases coming out of the gulf crisis.
Why will the government not take this money to pay for the blockade in the gulf? Why is the government trying in a sense to make money out of this gulf crisis for its own revenue?


Michael Holcombe Wilson: Mr. Speaker, I am pleased that the hon. member has asked me this question.
The net effect of the increase in the price of oil over all on the revenues of the Government of Canada is not positive. It is negative.
There is an increase in revenues related to the increased revenues that the oil and gas companies make, but offset by that is the negative impact on the economy of the increased price of oil and the impact this could have on inflation.
The net balance is not positive, as the hon. member suggests. The net balance is negative, and that is why my colleague, the President of the Treasury Board, came to the House last Friday with supplementary estimates to finance the increased cost of the efforts in the gulf.


FORESTRY DEVELOPMENT
Guy St-Julien: Mr. Speaker, my question is for the Minister of Forestry. On October 24 last I rose in the House to enquire about the Canada-Quebec forestry development subsidiary agreement.
My question is this: Should Quebec fail to respond to the August 24, 1990 federal government offer, will Ottawa look at another option to help the province's hard-pressed forestry producers?

November 26, 1990
Oral Questions
\English]


Hon. Frank Oberle (Minister of Forestry):: Mr. Speaker, as my hon. friend knows, on August 24 we offered Quebec a model that would serve as a future generation forest resource development agreement.
The province wanted to take some time to assess its own priorities. I indicated subsequently that failing any response from the province we would consider other options that would perhaps assist us in enlarging our traditional role in research and assistance to private wood lots.
However, I can report to my friend in the House that on Friday there was a very' useful meeting with Quebec officials, and it seems now that there is a desire to arrive at a new agreement quite soon.
sk 4s ^


REGIONAL DEVELOPMENT
Mr. David Walker (Winnipeg North Centre):: Mr. Speaker, my question is directed to the Minister of Energy, Mines and Resources in his role as the minister responsible for the core area initiative.
For the first time since the Great Depression, there are thousands of Canadians who can no longer feed and clothe themselves or their families. If we look at the supplementary estimates, we see there is nothing but bad news for all regional development projects.
I would like to ask the minister about a very special project in Winnipeg, the core area initiative, which thousands of Winnipegers depend upon and look forward to its renewal. The project is due to end on March 31, 1991 and yet there has been no announcement from the federal government.
Will he tell the House today what the government intends to do about the core area initiative?


Hon. Jake Epp (Minister of Energy, Mines and Resources):: Mr. Speaker, there is very good news about regional development in western Canada.
In terms of the estimates, my colleague, the Minister of State for Grains and Oilseeds who is responsible for western diversification, has stated that any reductions will be done in the area of management and operating costs. I know his staff is working on that, and I think it is fully in harmony with that.
I remind the hon. member of western diversification in his own city with Boeing, a tremendous expansion in the aeronautical industry. He was a member who decried western diversification giving money to Boeing because it was another one of these ugly multinationals that happened to be in Winnipeg and happened to create over 1,000 jobs for us.
That is what western diversification has done for our region and, if he does not want to praise his city, I will, including the great results yesterday in Vancouver.


David Walker: Mr. Speaker, the minister is the first western minister to announce that a cutback is a gain for the west. I am sure that will be well received throughout western Canada.
Second, he refers back to the Boeing example of the federal government giving $9 million to that corporation while in fact another department was paying out $150 million in a legal settlement. Quite obviously the left hand does not know what the right hand is doing when it comes to economic development.
The minister refused to answer the question. I will ask it again. The core area initiative has less than six months to go. You have not said anything. People think you are about to bail out on this city. Would you tell Canadians you are not going to bail out on Winnipeg?


Mr. Speaker:: I would ask hon. members to direct their questions through the Chair?


Arthur Jacob (Jake) Epp: Mr. Speaker, I am pleased the hon. member now feels that the Boeing deal is a good deal for Winnipeg and for Canada. I find it surprising, if he is talking about the CAI deal.
That deal was there before this government came into power in 1984. It has cost the country a tremendous amount of money, and the only person who has really benefitted is a certain Liberal who happened to be a supporter of that party in Manitoba.


An hon. member:: A lawyer.


Arthur Jacob (Jake) Epp: He is a lawyer of course but, more seriously, Mr. Speaker, in terms of the core we will be having a tripartite meeting on Friday of this week. I say to the hon. member that I appreciate his interest in core and that we will do the right thing for Winnipeg.
.	V


THE ENVIRONMENT
Mrs. Marlene Catterall (Ottawa West):: Mr. Speaker, my question is directed to the Minister of the Environment.
The government has cut $38 million from the department responsible for the highest priority of Canadians, the environment. It has cut over $130 million additionally from the programs of other departments which impact on the environment.
Will the minister tell us now what specific environmental programs will suffer from the cuts announced on Friday? What specific programs?


Hon. Robert de Cotret (Minister of the Environment):: Mr. Speaker, I am happy to answer to my hon. colleague that there will be no program cuts.
The cuts announced by my colleague, the President of the Treasury Board, will be reflected in increased efficiency in operations and management. It is O and M expenses that will reflect the cuts.
In terms of programs I would like to repeat, for the benefit of my colleague, that the budget of Environment Canada has been increased by 9.4 per cent for 1988-89 and 11.7 per cent for 1989-90, without counting for the current period an increase announced in the supplementary estimates of an additional $78.3 million to Environment Canada.


Marlene Catterall: Mr. Speaker, my supplementary question is for the Minister of Finance.
We are all aware of how the budget of the Department of the Environment was gutted in the first mandate of this government, and now it is just starting to get back. Canada is likely to have a white Christmas long before it has a Green Plan. The minister has said repeatedly in the Elouse he knows the cost of the Green Plan and that the government has set aside reserves for this.
Will the minister tell us exactly where in these supplementary estimates we will find the money for the Green Plan? What page? What line?


Michael Holcombe Wilson: I find it very hard to accept the word that the hon. member used
Oral Questions
when she said that the Environment Canada budget was gutted by this government. This gutted budget went from $777 million to $973 million. If that is gutting a budget, I do not know what increasing a budget is.
The hon. member has asked where the moneys are for the Green Plan. We have made it quite clear that there have been reserves that have been established for this purpose. The Minister of the Environment will be announcing the Green Plan in due course and that will set out more detail on this matter.



Mr. Jim Fulton (Skeena):: Mr. Speaker, my question is for the Minister of the Environment. Robert Cliche, the federal negotiator of the joint environmental assessment for the Great Whale project is quoted on the weekend as saying: "It is very, very, very unlikely that Quebec will ratify the agreement". There is an old saying that I am sure the Minister of the Environment is aware of, three strikes and you are out.
Given that two years have been fiddled, piddled and diddled away trying to negotiate a joint agreement on the Great Whale with the province of Quebec, will the minister stop dithering today and call for a full environmental assessment and review process of the Great Whale project, the dams, the flooding and the reservoirs, before the proponents start bellyaching that there is not time for assessing the environmental impacts of the project.


Robert René de Cotret: Mr. Speaker, I would like to repeat what I said last week. There will be an environmental assessment of the project, the roads and the airport. It will be a public process.
I stated very clearly, at that time, that we would prefer that process to be a joint process with the other interested parties, namely, the provincial government and native people. That is what we are discussing with the province at the moment and, hopefully, we will have news to report shortly. But there will be a process; it will be carried out; and, the process will be complete.
Point of Order


PRESENCE IN THE GALLERY
[Stage Direction]
November 26, 1990
Mr. Speaker:: I wish to draw to the members' attention the presence in the gallery of Dr. Dalibor Brozovich, Vice President of the Republic of Croatia.


Some hon. members:: Hear, hear.
j{:	jj:	*


PRIVILEGE
Mr. Peter Milliken (Kingston and the Islands):: Mr. Speaker, I rise on a question of privilege arising from the tabling of the supplementary estimates on Friday last. Attached to my copy of the supplementary estimates was a press release. The press release says, and I quote from it: "Parliament will be asked to approve expenditures that include $257 million to prepare and plan for the goods and services tax".
Over the weekend I took the time to read the supplementary estimates, as the government House leader recommended we do, and I found on page 32 a provision under the Department of Consumer and Corporate Affairs for the establishment of a goods and services tax consumer information office for a total estimate of $19,496,000. I found on page 52 of the supplementary estimates an additional $14,305,000 under the Department of Finance for its advertising campaigning to convince Canadians that this is a good tax. I found on page 84 of the supplementary estimates the sum of $202,987,000 under the Department of National Revenue (Customs and Excise Department) for preparation and planning for the GST. For the taxation portion of the same department, on page 85 of the estimates, there was shown an additional $67,254,000. On page 88 of the supplementary estimates, I found an additional $40 million for the Department of Public Works for preparation and planning for GST accommodation. On page 100-


Mr. Speaker:: I do not know whether the hon. member wishes to debate the supplementary estimates, but I am sure that there will be an opportunity to do so.
I am having some difficulty in finding the point of privilege. Perhaps he could get to the point.


Peter Andrew Stewart Milliken: I am sorry, Mr. Speaker, but the last one was an additional $21 million. The $21 million in supply and services was for cheques. Now if all those figures are added up, it comes to $365 million for the goods and
services tax. The minister's press release says it is $257 million. I submit there is a very serious discrepancy.


Some hon. members:: Oh, oh.


Peter Andrew Stewart Milliken: His press release is misleading the public.


Mr. Speaker:: I have to say to the hon. member that that is a matter of debate and is not a question of privilege.


An hon. member:: Oh, yes.


Mr. Speaker:: It is a matter of debate, not a question of privilege.


Peter Andrew Stewart Milliken: Mr. Speaker, with great respect, the press release is not correct.


Mr. Speaker:: There is a debate about what is correct or not correct in a press release. That is the question of debate.
The hon. member for Shefford on a point of order.


POINT OF ORDER
Hon. Jean Lapierre (Shefford):: Mr. Speaker, I rise on a point of order, because it has been several months since my colleagues in the Bloc quebecois and myself sent a request to the Chair and to the Board of Internal Economy about our rights and access to a research fund.
I am convinced that the fact we are not heated the same as other members, although there is a precedent for doing so, makes it difficult for us to function as efficiently as other members. And now, four months later, Mr. Speaker, I must say I find it hard to accept that not only are we deprived of adequate research but our former parties still receive funding allocated on the basis of our membership. Both the Liberal Party the Progressive Conservative Party continue to receive this funding.
Mr. Speaker, these funds should be put in trust immediately, because I believe access to research is a privilege to which all members should be entitled. I therefore find it very difficult to accept that it takes four months for the Board of Internal Economy to send us a reply, when we realize that in Quebec City, the four members of the Equality Party who represent a much smaller constituency-
November 26, 1990

Look at today's polls, Mr. Speaker-I won't read them to you, modesty forbids-but we represent a substantial share of the Quebec population. Consequently, Mr. Speaker, I hope and trust you will give us an answer as soon as possible. Whatever your decision we are at least entitled to a reply.


Mr. Speaker:: I will take into consideration what the hon. member has said. It may well be that an answer has been sent and the hon. member may not have received it. I will look into it and report back to the hon. member.
The hon. member for Cape Breton-East Richmond on a point of order.



STATEMENTS BY MEMBERS

['The Chair fully agrees that the question raised by the hon. member for\nNovember 26, 1990', 'Victoria is extremely important. However, it was raised today during Oral Question Period, and for the time being, as far as today is concerned, the Chair does not feel this question is so urgent it should be debated immediately.\nI therefore repeat: Although the question is important, it is not as urgent today as the hon. member for Victoria would have us believe.']
David Charles Dingwall: Mr. Speaker, perhaps it might be best to choose another location to discuss this with you, such as your chambers, but I would like to raise this matter with you.
On November 1, 1990 the hon. member for Abitibi under Statements by Members made reference to my colleague from Burin-St. George's in terms of his travel expenses which the Chair allowed to proceed in its entirety.
On November 8, the member for Scarborough-Agin-court made certain references to subject matter which he believed to be important. He was thereafter called to order by the Chair.
More importantly, Mr. Speaker, on November 19, my colleague from Burin-St. George's made some remarks with regard to the different positions being taken by the New Democratic Party in the province of Newfoundland, as well as on the floor of the House of Commons. I believe at that time the Chair stood in its place and again directed certain comments to that particular member. I, as well as other members on this side would like to have the opportunity of perhaps visiting your chambers in order to discuss both the process and indeed, the substance of what appeared at first hand, to be different treatments, if you will, being given to different members of Parliament from different political parties. I am sure this Speaker would at least entertain me in his chamber in order to make those particular points.
Routine Proceedings


Mr. Speaker:: I would like to assure the hon. member that the Chair, as much as is humanly possible, would not ever treat one hon. member differently than the others.
A few days ago I said to the hon. member for Scarborough-Agincourt that it may well have been that something slipped by my careful consideration. That is not satisfactory, but perhaps that is what happened. With respect to the hon. member for Burin-St. George's, I would be very pleased to go over the transcript. I might also ask the hon. member to give me in full what it was he intended to say.
We will try to keep within the bounds of the prescription of Madam Sauve of some years go, in that Statements by Members are not supposed to make a personal attack on a member. I recognize that that gets a little difficult sometimes, especially when what is being attacked is a political position taken by the member.
Madam Sauve also commented on the fact that congratulations are really not the purpose of members' statements. I received a note today from one hon. member who is very diligent on these matters, pointing out that it may not have been appropriate to offer congratulations to the Winnipeg team. I felt constrained, despite the fact that there have been comments by past Speakers, I was not sure that to restrain hon. members in congratulating the winner of the Grey Cup would make any friends in the Chamber at all.
However, it is a difficult line sometimes to find. It is doubly difficult because the Chair cannot always be sure of exactly where the statement is going. If it is giving members trouble and difficulties, I would be very pleased to discuss it and to see if we can straighten it out. It is not my purpose to leave even an impression that one member is getting treatment that is not available to another member.
I would ask all hon. members because it is an important matter, to be very careful in giving members' statements. If it is strictly a comment upon a political position, that is one thing. If it passes over that and becomes a personal attack, then we have tried to stay away from that sort of thing.

November 26, 1990
Routine Proceedings


Guy St-Julien: Mr. Speaker, I wish to speak to the same question of privilege, since my name was not mentioned. It was on Thursday, October 1, that I mentioned in a statement in the House of Commons that the hon. member for Burin-St. George's had spent $118,865 on travel expenses.
Mr. Speaker, I would like to say that I made this statement on the basis of information taken from the Public Accounts of Canada, available to all members of this House, and I merely said what appeared in the Public Accounts. I only reported the truth.


Mr. Speaker:: Perhaps the best thing to do would be to leave it as I said. I will see the hon. member and other hon. members if there is difficulty.
We have tried to be very careful in this matter. I think hon. members can understand why.



Mr. Derek Blackburn (Brant):: Mr. Speaker, I have the privilege and honour, pursuant to Standing Order 36, to present this petition signed by Canadians from coast to
coast.
The petitioners implore the government not to impose a GST on journals, magazines, books and other reading material, and to maintain the tradition in Canada that taxes not be placed upon reading materials and the promotion of literacy in a country' that needs that kind of promotion.


David Charles Dingwall: Mr. Speaker, I have a petition to present, pursuant to Standing Order 36. It is from residents of the town of Dominion in my constituency, primarily those individuals who have been associated for quite some time with the Dominion volunteer fire department.
As duly noted in their petition, fire departments provide a vital service protecting the lives and property of all citizens. Because the federal Department of Communications has now imposed huge increases in licence fees for radio telecommunications including all emergency service radio equipment, the petitioners call
upon the Government of Canada to exempt fire departments such as those in communities such as the town of Dominion. I would call upon the government to act forthwith.


David Charles Dingwall: Mr. Speaker, on another subject matter, I have a number of petitions to present, pursuant to Standing Order 36, signed by individuals from across the country, from places such as like Markham and Don Mills, both in Ontario.
The petitioners are calling upon the Government of Canada to withdraw the goods and services tax and in particular the tax which has been levied upon books, newspapers, magazines and various other materials. They would hope that the members of the government would see their way and acknowledge the outright opposition that Canadians have from coast to coast with regard to this particular measure and in particular the effect that it has on magazines, books and newspapers and that the GST be withdrawn immediately.


Sheila Finestone: Mr. Speaker, this petition has been certified correct as to form, pursuant to Standing Order 36. Your petitioners do not support the government's intention to apply the goods and services tax to books, magazines and periodicals.

These people find that the dissemination of the printed word as a corner-stone of democracy, culture, and education and of a literate and productive society will be negatively affected by the GST. The petitioners call upon the government and this minister to understand the impact. A1 per cent increase in books is a 2 per cent loss in sales. As this is the year of literacy internationally sponsored by the United Nations, this is a very serious matter and I hope the government through the Prime Minister's good offices-because he agrees with us-that this tax will be withdrawn.


Mr. Robert E. Skelly (Comox-Alberni):: Mr. Speaker, I have the honour, pursuant to Standing Order 36, to present a petition signed by just over 250 residents of Edmonton, Alberta, and St. Albert, Alberta. They are petitioning the government and the House of Commons to apply a zero rate of tax to magazines, books and newspapers now as it has done in all of the years since Confederation.
November 26, 1990

The petitioners are concerned that uninhibited dissemination of the printed word is a corner-stone of democracy, of culture, education, and literature, and a productive society will be negatively affected by the application of the GST to the printed word. The petitioners call on the government to reaffirm the historic principles embodied in tax-free status for the printed word by retaining the zero rate in the GST legislation as it affects the printed word.


Mr. Len Hopkins (Renfrew-Nipissing-Pembroke):: Mr. Speaker, I, too, rise on behalf of a large number of petitioners from Ottawa, Toronto and other Ontario communities, who do not want to see the GST applied to books, magazines and other reading articles.
At a time when we are talking about promoting literacy, it is just not the time at all, at any time, to be putting a tax on reading. This has never been done in Canada since Confederation. Surely, with the interest that Canadians have in education and the need for the wide dissemination of knowledge today, there should be no tax inhibiting the progress of knowledge and reading material in any way whatsoever.


Ronald MacDonald: Mr. Speaker, it is my pleasure today to rise, pursuant to Standing Order 36, once again to present a petition to the House signed by members of the communities Shubenacadie and Stewiacke, most of whom are volunteers with the volunteer fire departments of those communities.
The petitioners are asking the government to withdraw its increases in radio licence fees, telecommunications licensing fees. They believe that these fees which have not applied to them since 1986, but now do, will place a severe financial burden on these volunteer fire departments. Also, because of the additional cost, volunteer fire departments may be prevented from upgrading their services and equipment.
Routine Proceedings
The petitioners are asking the government to see the error of its ways and to forthwith reduce and eliminate these unfair licence fees that volunteer fire departments now find themselves faced with.


Mr. Sid Parker (Kootenay East):: Mr. Speaker, I, too, rise, pursuant to Standing Order 36, with a petition which has been affirmed as correct.
The petitioners humbly pray that the government will withdraw the GST from the printed word. There are over 250 signatures from various cities in Alberta. The petitioners humbly pray and call upon Parliament to reaffirm the historic principles embodied in tax-free status for the printed word. The petitioners find it deplorable that a government would be bringing in a tax system at this time when we are trying to allow people to have a better opportunity to upgrade their reading skills and so on. They are calling for the government to abandon its taxation of the printed word.


Mr. Derek Lee (Scarborough-Rouge River):: Mr. Speaker, I rise, pursuant to Standing Order 36, to present to the House five petitions wherein the petitioners call upon the government to abandon the proposed GST on books and periodicals. This tax, if passed, would be an impediment both to improved literacy and our freedom of expression, both of which are principal underpinnings of our democracy here in Canada.


Mr. Stan J. Hovdebo (Saskatoon-Humboldt):: Mr. Speaker, it is my honour and duty to present a petition on behalf of citizens of Edmonton who point out that they dislike the GST under any circumstances, but they particularly dislike the idea of it being put on magazines, books and newspapers. The petitioners call upon the government to retain a zero rate of GST on those articles.


Peter Andrew Stewart Milliken: Mr. Speaker, I, too, have a petition along the same lines signed by numerous residents of the city of Toronto who are opposed to the goods and services tax. They are opposed to the greedy way in which the government has proceeded to levy this tax.
The petitioners support the senators in their efforts to excise from the goods and services tax bill the provisions

Routine Proceedings
relating to the tax on books and the printed word which is unprecedented in this country and, indeed, in almost any reasonable democracy.
I call upon the government, as do these petitioners, to withdraw the goods and services tax in its entirety and, if it is unwilling to do that, at least to amend it to excise these very odious and offensive provisions.


Mr. Albert Cooper (Parliamentary Secretary to Leader of the Government in the House of Commons):: Mr. Speaker, if Question No. 295 could be made an Order for Return, the return would be tabled immediately.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House that Question No. 295 be deemed to have been made an Order for Return?


Some hon. members:: Agreed.


Mr. Boudria: 1.	Can the Government identify the members of its Free Hade negotiating team and support staff and, if so (a) what are their names (b) in each case, what is or was the duration of their employment?
2.	What is the total cost of the Free Hade negotiations in terms of (a) salaries (b) office expenses (c) travel expenditures?
Return tabled.


Albert Glen Cooper: Mr. Speaker, would you be so kind as to call Starred Questions Nos. 355, 362,374 and 376. Due to the number of responses, I would ask that they may be printed in Hansard as read.


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


Some hon. members:: Agreed.


[Stage Direction]
*
Ms. Langan (Mission-Coquitlam): 1.	Has the Minister of Justice invited any Canadian women to a weekend retreat in Parksville, B.C. and if so (a) who was invited (b) what criteria were used in the selection of invitees (c) what is the purpose of the meeting (d) what items are on the agenda of the meeting (e) are there any costs to the federal treasury associated with the meeting and if so, from what budget will those costs be paid?
2.	What reasons are given for this meeting being hosted by the Minister of Justice rather than the Minister responsible for the Status of Women?


Hon. Kim Campbell (Minister of Justice and Attorney General of Canada):: 1. Parksville (B.C.) meeting was cancelled.
(a), (b), (c), (d) and (e): Not applicable 2. Not applicable


[Stage Direction]
*
Mr. Duhamel: 1.	For each year since 1984, how many "actual dollars" have been transferred to each province for (a) health (b) education?
2.	If the current formula remains unchanged, how many "actual dollars" will be transferred to each province for (a) health (b) education for the period 1991-92 to 2000-01?


Michael Holcombe Wilson: See attached.
1. Hansfers to Provinces in Respect of Health and Post-Secondary Education (PSE) under the Established Programs Financing (EPF) Arrangements 1984-85 to 1990-91
		NFLD	PEI	NS	NB	QUE	ONT	MAN	SASK	ALTA	BC	NWT	YKN	TOTAL
							($ Millions)							
1984-85	health	238	52	359	294	2,697	3,699	438	416	972	1,183	21	10	10,379PSE	96	21	145	119	1,089	1,493	177	168	392	478	8	4	4,189total EPF	334	73	504	413	3,786	5,191	615	583	1,364	1,661	29	13	14,5671985-86	health	254	56	387	315	2,892	3,998	472	448	1,043	1,274	23	10	11,171PSE	102	23	156	127	1,167	1,614	191	181	421	514	9	4	4,508total EPF	356	79	543	442	4,059	5,612	663	628	1,463	1,788	32	15	15,680
November 26, 1990

Routine Proceedings
1986-87 health	267	59	410	334	3,071	4,279	503	474	1,115	1,357	25	11	11,905PSE	108	24	165	135	1,239	1,727	203	191	450	548	10	4	4,805total EPF	375	83	575	468	4,310	6,006	706	666	1,565	1,904	34	15	16,7101987-88* health	279	63	431	350	3,237	4,550	530	499	1,168	1,436	26	12	12,580PSE	113	25	174	141	1,307	1,836	214	201	471	580	10	5	5,077total EPF	392	88	605	491	4,544	6,386	744	700	1,639	2,016	36	17	17,6571988-89* health	291	66	453	366	3,406	4,836	556	520	1,229	1,531	27	13	13,294PSE	118	27	183	148	1,374	1,952	224	210	496	618	11	5	5,365total EPF	409	93	636	514	4,780	6,788	781	729	1,725	2,149	38	18	18,6581989-90* health	307	70	477	387	3,599	5,150	583	542	1,307	1,644	29	14	14,109PSE	124	28	193	156	1,453	2,078	235	219	528	664	12	6	5,694total EPF	431	98	670	543	5,052	7,228	819	761	1,835	2,308	40	19	19,8031990-91* health	307	70	479	388	3,619	5,222	587	544	1,328	1,674	29	14	14,260PSE	124	28	193	157	1,461	2,108	237	219	536	675	12	6	5,755total EPF	431	98	673	545	5,080	7,330	823	763	1,864	2,349	41	19	20,016
Totals may not add due to rounding. * Estimate
2. No detailed forecasts of such payments are made beyond five years, due to the difficulty of accurately forecasting factors such as gross national product, basic federal tax and population for these years.
Projections of EPF entitlements in respect of health and post-secondary education for the program years 1991-92 to 1994-95 are shown below. All figures are on a basis consistent with the February 1990 Budget. These projections are also subject to the difficulty of estimating transfers based on economic and demographic variables well into the future.
2. Projected transfers to Provinces in Respect of Health and Post-Secondary Education (PSE) under the Established Programs Financing (EPF) Arrangements 1991-92 to 1994-95
		NFLD	PEI	NS	NB	QUE	ONT	MAN	SASK	ALTA	BC	NWT	YKN	TOTAL
							($ Millions)							
1991-92	health	307	70	482	390	3,639	5,300	590	546	1,348	1,703	29	14	14,418PSE	124	28	194	157	1,469	2,139	238	220	544	687	12	6	5,819total EPF	431	99	676	547	5,108	7,438	828	767	1,893	2,391	41	19	20,2371992-93	health	314	72	495	400	3,744	5,504	608	562	1,400	1,773	30	14	14,917PSE	127	29	200	162	1,511	2,221	245	227	565	716	12	6	6,020total EPF	441	101	695	562	5,254	7,726	853	788	1,965	2,488	42	20	20,9371993-94	health	322	74	509	411	3,851	5,707	626	578	1,455	1,844	31	15	15,422PSE	130	30	206	166	1,554	2,303	253	233	587	744	12	6	6,224total EPF	452	104	715	577	5,405	8,010	879	811	2,043	2,588	43	20	21,646
November 26, 1990
Routine Proceedings
1994-95	health	330
PSE	133
total EPF	464
77	526	423	3,97731	212	171	1,605108	738	594	5,5825,937	647	597	1,5192,396	261	241	6138,333	908	837	2,1321,924	32	15	16,004777	13	6	6,4592,701	44	21	22,462
Totals may not add due to rounding.


[Stage Direction]
*
Mr. Riis: Does the government intend to inform Canadians fully of all the details of the events at Kanesatake and Kahnawake, Que. and, if so, will it be gathering that information through an impartial judicial inquiry?


Hon. Thomas Edward Siddon (Minister of Indian Affairs and Northern Development):: On October 22, 1990 the House of Commons unanimously agreed "that the subject matter of the events at Kanesatake and Kahnawake during the summer of 1990 be referred to the Standing Committee on Aboriginal Affairs".


[Stage Direction]
*
Mr. Riis: Has the government determined the cause or causes of the events at Kanesatake and Kahnawake, Que., and, if so, what are they?


Thomas Edward Siddon: The immediate cause was the non-settlement of the land question at Kanesatake. The federal government had been in negotiations with the Kanesatake Band Council concerning its land grievances and an agreement was reached in the Fall of 1989 which was to be discussed and ratified by the community in early 1990. In January 1990 the Band Council was changed and in March 1990 the Band Council informed the federal negotiator that the Council would not pursue the negotiated agreement and would not continue talks until further notice.
The Minister of Indian Affairs and Northern Development met with the Council in June 1990 to attempt to put in place a process aimed at resolving the long standing issues in the community. In late June the Municipality of Oka obtained an injunction against individuals blockading municipal land and a violent
confrontation occurred when this injunction was served by the Surete du Quebec.


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


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


Some hon. members:: Agreed.


John F. Brewin: Mr. Speaker, as I understand, a letter was delivered to the Speaker notifying the Speaker that I intended to ask today for an emergency debate as provided under Standing Order 52.
The emergency to which I refer is the fact that the reports are that on Thursday of this week the United Nations Security Council will consider a resolution authorizing the use of force in the Persian Gulf. Canada, of course, is a member of the Security Council. We will have no opportunity between now and then in the House to debate the position that Canada should be taking at the United Nations.
The issue is one of momentous international significance and of tremendous significance to Canada and to the people of this country. The government has earlier indicated that it would ask Parliament for its advice on key issues in the gulf crisis as it moved along. There is no more significant issue than the issue of war and peace in the gulf.
I would therefore ask you, Mr. Speaker, to find that this is in fact a genuine emergency, one of those for which Standing Order 52 was developed and an appropriate motion under that standing order.


The Acting Speaker (Mr. DeBlois):: The Chair fully agrees that the question raised by the hon. member for
November 26, 1990

Victoria is extremely important. However, it was raised today during Oral Question Period, and for the time being, as far as today is concerned, the Chair does not feel this question is so urgent it should be debated immediately.
I therefore repeat: Although the question is important, it is not as urgent today as the hon. member for Victoria would have us believe.



GOVERNMENT ORDERS


Gilles Loiselle: that Bill C-91, an act to amend the Financial Administration Act and other acts in consequence thereof, be read a second time and referred to a legislative committee.
He said: On November 1, Bill C-91, an act to amend the Financial Administration Act and other acts in consequence thereof was introduced in the House. The amendments this bill proposed for consideration by the House are largely technical in nature. I do not anticipate that the hon. member will find much with which to take issue in this bill.
In leading off debate, I would like first to describe the government's purpose in proposing these amendments to the House, and then describe the most significant of them in further detail so that hon. members can appreciate their significance and understand why they make sense and why they should be passed as quickly as possible.
This bill amends some 70 sections of the Financial Administration Act. The bill has been drawn together after considerable thought and a lengthy consultation process into a package of amendments designed to do a number of things.
First, they would improve the management of the federal government's cash inflows and outflows. They would streamline internal administrative processes that have tied the hands of our management in the past. They would clarify roles, responsibilities and authorities so that accountability is increased and uncertainty is decreased.
Government Orders
They would increase the efficiency with which government programs and services are administered. They would permit Public Service employees and managers to offer better service to the public by cutting red tape and giving more flexibility to fund delivery of services.
Ultimately, Mr. Speaker, the government's aim in coming forward with these amendments is to prepare the federal government's financial administration practice for the increasingly complex and competitive 1990s and beyond.


An hon. member:: And the GST.


Gilles Loiselle: Mr. Speaker, the government must remain competitive with advances being made in the private sector. It must be prepared to cut its costs of operation further and to work more efficiency. It must measure up to the increasingly demanding expectations of Parliament, the Public Accounts committee, the Auditor General, and all taxpayers.
Bill C-91 contains some amendments designed specifically to help our program managers achieve some of the spending cuts and management improvement that were contained in the December 15, 1989 announcement and to open up new opportunities to save money in the future when it is appropriate to do so along the same lines.
By permitting the introduction of new efficiencies, these amendments would make a significant contribution to deficit reduction which will benefit all constituents. At the same time, they would improve the consistency and fairness with which the government's user fees are applied, which I am confident is important to all members.

Bill C-91 also supports the goals and general direction of the government's ongoing Public Service 2000 initiative.
Mr. Speaker, Members of this House are aware that Public Service 2000 aims to cut back on red tape and internal constraints that have long impaired the efforts by Public Service managers to improve program efficiency. "Constraints to productive management", as the Auditor General has referred to them in the past, have prevented many government departments from becoming what he referred to more recently as "well-performing organizations".
They have also resulted in low morale among government managers and employees who seek only to serve the public in the best way they know how.

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Since Canadians are both shareholders and customers of the Public Service, I thoroughly endorse and recommend for rapid passage these worthy amendments that I would now like to describe in some detail.
The Treasury Board has had an informal role in the planning and administration of real property management in the Public Service for some time. Amendments proposed would formalize that role.
Several amendments are designed to improve cash management and to modernize the government's payment practices. They are driven by an overriding desire to be fairer to all taxpayers, the majority of whom pay their bills to the government on time.
Among these are provisions to make collection agency fees statutory expenditures, thereby eliminating the current budgetary disincentive faced by managers when using them.
In the case of the minority of Canadians who do not pay their bills to the government within a reasonable time, thereby placing a financial burden on all taxpayers, there are provisions to make regulations to charge interest on overdue accounts and to impose an administrative fee when payment is made by NSF cheques.
There is, throughout, provision to exempt taxpayers from these measures for humanitarian reasons when it is appropriate to do so, including an expanded authority to forgive any debts, not just fees and taxes, where enforcement and collection is considered to be unreasonable or unjust under the circumstances. The issue also arose during debate in this House on Veterans Affairs' overpayments on September 23, 1988.
The forgiveness provisions are important because they would make it possible for the government to recover at least some of the hundreds of millions of dollars that are owed, but which are deemed to be effectively uncollectable, by making it possible in exchange for payment of the principal. This would also extend to all Canadians the same straightforward process that we apply to crown corporations. This proposed change was recommended by the Senate finance committee in its fourteenth report in March 1986.
There are also provisions to permit the making of payments electronically, which is the wave of the future,
and in general to permit more businesslike practices in the interests of all Canadians.
Other amendments are aimed at clarifying and modestly extending Financial Administration Act provisions regarding cost recovery and user charges. Among other things, the amendments will facilitate a more consistent and equitable approach to charging across the government.
These amendments would enhance revenue-generation and cost-recovery opportunities from the users of government programs and services, which are important to the government's efforts to improve efficiency and attack the deficit.
Furthermore, the government feels that charging clients a fee for specific services and the use of facilities when there is a clearly identified beneficiary is fairer to all taxpayers. It is also an important means of improving the management and allocation of scarce resources.
Other provisions of this bill would help certain commercial type government operations to respond in a more businesslike way by adjusting the level of service to meet client demand on a full or at least partially self-financing basis. This would both relieve pressures on the government's operating reserve and support the Public Service 2000 initiative with its clear emphasis on improving service to the public.
I would like to stress that neither the user charging nor the spending of revenue provisions containing these amendments would result in departments suddenly supplementing their appropriations with user fees. Only Parliament may authorize departments to spend revenues they collect. Fees would be prescribed by order and therefore would have to be published in The Canada Gazette. In addition, consistent with the government's regulatory process, which provides an opportunity for public input, users would be notified in advance and, where warranted, would be consulted prior to the establishment of fees.
Authority to spend revenues would have to be included in appropriation acts that Parliament would be asked to review and approve. These arrangements facilitate spending of revenues and create revolving funds which would be used only when it is considered that significant managerial improvement would result.



November 26, 1990

The government agrees with the Auditor General that spending of user fees should be restricted to specific existing activities. They would be tied directly to expenditures incurred and limited to actual out-of-pocket expenses. Cross-subsidy or diversion to other activities would be strictly prohibited.
These amendments would also support the financial arrangements necessary for more innovative and cost-effective forms of organization to deliver services to the public. An example of these is the new special operating agency concept that was announced on December 15, 1989.
With the passage of this bill, the Department of Finance would be assisted in its day-to-day management of the government's debt while some technical amendments would improve or clarify some 39 other sections of the Financial Administration Act, of which 25 deal with the accountability and control of Crown corporations.
Proposed amendments concerning Crown corporations are largely technical in nature, or build on established policies already in place and on lessons learned since the control and accountability regime for Crown corporations was extensively revised in 1984.
Members will be aware that an important element of the Comptroller General of Canada's cash management strategy, a successful strategy, that has saved taxpayers $1 billion since it began five years ago, is the recovery of millions of dollars of cash surplus to the needs of some Crown corporations.
The government proposes to amend the Financial Administration Act to require that corporate plans of profitable Crown corporations that operate in a commercial environment would provide a dividend payment strategy. With these changes to the act, commercially-successful Crown corporations would expect to provide a return on the investment made by taxpayers.

Although a minister responsible for Crown corporation and the Minister of Finance, with the approval of
the Governor in Council, can now direct a Crown
Government Orders
corporation to return surplus funds to the Consolidated Revenue Fund, there is no provision explicity for dividends that would make planning for dividends an integral part of the corporate planning process.
However, the government feels that these corporations have a responsibility to pay dividends to the shareholders-that is, to ALL Canadians-whenever they are capable of doing so. After all, in the private sector, it is considered normal that a shareholder earn a return on investment, and the government does not feel ordinary taxpayers should be shortchanged in this respect.
Therefore, Mr. Speaker, the proposed amendments would enshrine the clear-cut expectation that commercial, profitable Crown corporations would be expected to pay dividends, just like their competitors.
Annual dividend proposals would be included as part of the corporate plans for Schedule III, Part II, corporations such as Petro-Canada, CN and Canada Post, although the Governor in Council would be able to waive or vary dividends, when considered appropriate.

To summarize the aims of this bill, it is felt that the passage of Bill C-91, an act to amend the Financial Administration Act, responds to the view of the majority of Canadians that the government should continue to adopt more businesslike practices and that the clients who use specific government services and facilities should pay their fair share of the costs of providing those services and facilities.
Consumers have told us that in the 1990s and beyond they will expect more quality and a higher level of service from the providers of goods and services, be they companies in the business community or governments. The Public Service 2000 initiative supports this expressed desire from the public, and Bill C-91 supports it as well.


Marlene Catterall: Mr. Speaker, the minister tells us that this bill meets the wishes of Canadians for more business-like practices, for the government to remain current with practices in the private sector and to operate in a more business-like manner.

Government Orders
On the other hand, it is presented as primarily a technical and housekeeping bill. I cannot express the concern with which I have just heard some of the minister's statements.
Less than a month ago, the minister and officials of the government made a commitment that there would be no legislative implementation of the directions of Public Service 2000 until there had been full consultation with employees and with their unions, and further consultation with the public.
The comments I have heard today have made it clear that the government is consulting with a very limited segment of Canadian society. The names one sees on the consultations throughout the process of PS 2000 make it evident that primarily large corporations are directing the tendency of this government and the ways it intends to practise. The commitments it made to its employees just a short month ago do not count at all. I must express to the minister my veiy bitter disappointment that he has chosen to take that approach today in speaking to this bill.
One thing that concerns me deeply is that there is a tremendous need for revitalization in the Public Service. There is a tremendous need for reform, for renewal of morale, commitment and excellence in the Public Service, one which the employees are willing and eager to co-operate with. In proceeding with the implementation of a plan that they have not been part of developing and in that they have not been part of identifying solutions and problems, the government is undermining any hope for realistic and lasting reform and revitalization in the Public Service.
The government may have heard the views of a certain segment of Canadian society that we should be operating more like the private sector. In my view that has not been appropriately or sufficiently balanced by the recognition that this is not the private sector. Our bottom line is not profit, but people.
I want to talk to some particular aspects of the bill. The minister mentioned that people would be consulted on various things that are being done with this bill. Yet today his very commitments to consultation with his own employees have not been kept.
We are seeing some major fundamental changes here in a number of ways. We are certainly seeing progress along the path of privatization and depublicizing the public sector that perhaps a limited circle of those with
whom the minister and the government can consult are entirely in favour of but with which I think the majority of Canadians are not.
I want to address some of the changes made to Crown corporations. Nobody disagrees that there should be more accountability and that the ways in which that can be achieved should be achieved.
However, I also want to point out the tendency in this bill to look at profits rather than public policy as the major objective of Crown corporations. We have seen the devastating results in a number of areas from the government's basic approach of not believing in a public role for Crown corporations, of believing that when they become profitable they immediately no longer become a public sector operation. This bill paves the way for even more of that approach.
I want to remind the House of some of the areas in which the government seems to have forgotten the public policy role of Crown corporations.
I would mention VIA Rail. If this is an example of the government's concept of how a Crown corporation should operate in a more customer oriented way and in a more responsible way to deliver good service, I can assure members of the government sitting opposite that that is not what is happening.
It is now impossible, if one wants to travel by rail, to do it conveniently, to arrange to have a ticket conveniently, or to change one's travel plans conveniently. I can walk into any airport in this country and at the last minute decide that I am not taking one flight, that I am taking another, and switch my ticket. I cannot do that on VIA Rail. In fact I cannot even walk into VIA Rail, pick up my ticket on the basis of my Visa card, and get on a train. Students who come home for the weekend to visit their families, mostly because they want a nice hot meal on Sunday evening, cannot leave Ottawa and go back to Toronto, Montreal, or Kingston after six o'clock.
I would mention Air Canada and the approach of the government on privatization. I well remember a program just before Air Canada was privatized or put on the road to privatization. I would like to replay it in this Chamber today. I remember Mr. Claude Taylor saying how wonderfully he could manage Air Canada if only he were not hampered by the rules and regulations imposed on his by government. My private thoughts were: if he can manage
November 26, 1990

so well, why would he not manage in the public interest as well as in the private interest?
Now we see Air Canada, just a little over a year later, losing business. We see competitiveness in our air industry damaged beyond belief. We see reduced service, and we see increased costs.
We see the post office under this government's view of how Crown corporations should act, delivering a lesser and lesser level of service to fewer and fewer Canadians and abandoning all pretence at what this country is about, which is equality of service and equality of standards to Canadians across Canada.
I hesitate to accept that the changes being made in this bill as to how Crown corporations are going to report and how they are going to be held accountable will improve the functioning of Crown corporations. They will do nothing more than prepare them a little better for privatization and sell-off.
What has the public got out of the sell-off of Crown corporations? The selling of a Crown corporation and not using the proceeds to reduce the national debt is a little like selling your house to pay your heating bill. If you are selling off an asset, you should use it to reduce your capital obligations, and this government has not done that.
It has sold off billions of dollars of Crown corporations over the last six years. Has any of that money been used directly to write down the debt and to reduce the growing burden of interest payments on the taxpayers of Canada? I do not think so. If we look at the debt now compared to what it was when the government came to office in 1984, we see that it is more than double.
I would think that in making changes to help Crown corporations operate and in trying to make them more accountable this government should also be reaffirming its commitment to the idea of the public sector-public policy role of Crown corporations and their obligation to serve a public policy purpose as opposed simply to making profits.
If for instance we were amending the accountability processes for Crown corporations, this would have been an opportune time to include environmental auditing and the other various audits and mechanisms with which the bill deals, but it does not do that. It further reduces
Government Orders
the obligation of the President of the Treasury Board to report to this House on how Crown corporations are exercising their accountability. It reduces that obligation from four times a year to once a year.
I think that is enough on Crown corporations. I would like to move on to some of the other financial management measures in this bill. One of the difficulties is that the public does not have a very good record of financial management by this government on which to judge this bill.
We are slightly suspicious of intentions to expand the use of collection agencies, especially as we see the government forcing more and more of the burden of taxation on to lower income Canadians. That will only be exacerbated when the GST is imposed. We see increasing discretion by ministers in this bill for forgiveness of debts to the government. Yet we see the ability to use collection agencies to go out and grab from Canadians the few dollars that they may not be able to pay.
I see very little in this bill that controls the use of collection agencies by this government. I would like to touch on one area where we have reason to be concerned about the failure of the government to explain adequately to Canadians how it is spending their money and how it is being accountable and responsible for their money.
I was shocked to be sitting at a meeting of Standing Committee on Public Accounts less than six months ago when a member of the committee asked if Treasury Board officials could tell us whether we are really saving money by downsizing the Public Service, for instance. They were asked if they could tell us how the cost of contracting out services, hiring contract people, hiring temporary agencies to perform work previously done by Public Service employees was saving us money, or how it compared to the cost of doing it with permanent, long-term committed Public Service employees. The shocking answer was that Treasury Board could not tell the public accounts committee that because it did not keep track of it. It is no wonder that Canadians have lost confidence in the financial management practices of the government.
I would like to refer to some of the cuts that were announced by the government last Friday which give us deep cause for concern. It was almost the atmosphere in which this was done. We saw the travesty of the Prime

November 26, 1990
Government Orders
Minister, for over a week before this announcement was made on Friday, attempting to create the impression that the government would be bringing in cuts to government programs and cuts to government spending in order to finance the efforts of our men and women in the gulf.
Instead we find out on Friday that the bulk of the overspending by government is not due to the efforts of those people who are serving us in the gulf. It is due to the high interest rate policy of this government. We have $2.5 billion of overspending to cover the increase in public debt charges due to the high interest rate policy of this government. It is the same high interest rate policy through which Canadians are losing their homes and their jobs. It has also increased the number of bankruptcies. People are losing their ability to keep their heads above water in difficult economic times. It is not our forces in the gulf that are causing this cut to government programs. It is $2.5 billion of overspending by this government, based on its own interest rate policy.
Then we have over $300 million additional spending on the goods and services tax, a tax that nobody wants. Where is most of this money going? It prepares to grab and gouge that tax from Canadians. Then the insult of insults: it prepares propaganda to convince them they like it. Even worse is to send out cheques, bribing them into thinking that next year they really want to pay more tax. For the Prime Minister to talk for over a week about the needs of our forces in the gulf and then to table this kind of financial information, where less than 10 per cent of the overspending is due to the forces in the gulf is an insult to Canadians and an abuse of those men and women who are serving us away from home.
I want to talk about a few other cuts that were announced on Friday. They are great examples of the financial mismanagement of this government. We are not going to refurbish or rebuild our Archives. We are going to go through another winter with freezing pipes and irreplaceable antique records and documents lost as they were last year.
A recently released spills report says that the government is incapable of responding to an even minor oil spill, much less a one. The coast guard is 25 per cent
underfunded for what it needs to do in the area of protecting our oceans and our waterways.
The report of the Auditor General says there is no monitoring of ocean dumping whatsoever under Environment Canada. Again the Auditor General's report tells us that the enforcement of CEPA is tremendously lacking, that there were in total three convictions for violations of Canada's Environmental Protection Act out of well over 3,000 investigations.
The report that was tabled on Friday tells us cuts that the government has made in the past to the transport department now have to be reinstated because the aviation safety of Canadians can no longer be assured. The government was told that when it cut personnel from aviation safety, but it persisted with that cut anyway. Now here it is, having received a devastatingly, critical report on aviation safety in Canada which pointed out that we have twice the accident rate as exists in the United States. Now the government is reinstating jobs and operating money that it should never have cut in the first place.
Health and welfare, especially the health protection branch, is being cut when the costs of health care are increasing dramatically.
Employment and immigration is being cut while the Auditor General is criticizing the government for its mishandling of immigration and refugees, security clearances and its virtual lack of verifying the performance of entrepreneur immigrants.
We have cuts to unemployment and immigration when right now the Canada Employment Centres can do no more than hand out cheques. They cannot help people at a time of high unemployment to find jobs because they cannot help employers to find people who can fill their jobs.
We have the whole area of the environment in many departments which is suffering from cuts announced on Friday, despite the words of this government. We still have no clear explanation of why these cuts are being made. We have no clear explanation of why our armed forces at full strength, being paid for and equipped in Canada, suddenly are costing us hundreds of millions of dollars more because they happen to be in a different location.
The report of the Auditor General says there has been a steady drift to larger and larger numbers of officers and NCOs with fewer and fewer lineal units to lead. The senior ranks now appear disproportionately larger in
November 26, 1990

comparison with the over-all size of the forces and the number of line units. The Auditor General criticized the medical support system for the Canadian Armed Forces. It is not much wonder if Canadians and the Liberal Party view with suspicion any financial management bill that the government brings forward in light of its performance to date on these issues.
I want to mention a few specifics of this bill. The government is increasing the application of user fees to virtually anything that government or any agency connected with government touches. Yet it protects itself from fees. I noticed in the bill that where the government is charging more and more fees, the adjustment to those fees is automatic.
Now I do not imagine the bill is talking about downward adjustment of fees. The adjustment of fees is automatic, but we have discussed time after time in this House bills and challenged the government to put an automatic adjustment of benefits to Canadians into legislation or regulation without any success.
The clawback of old age security will affect more and more Canadians at lower and lower incomes because the government has failed to provide any automatic indexing to protect seniors in Canada against the growing clawback. As their incomes go up, as inflation goes up, those at lower and lower incomes unfortunately will be paying the clawback. Families with smaller and smaller real incomes will be paying the clawback.
But when the government brings in legislation that allows it to impose fees, it sure knows how to protect itself against inflation, but not Canadians.
In this bill the government charges interest on money owing to the government, even where the payment of that money has been an overpayment or a straight error by government. It wants to be able to go back, regardless of how long ago it was, and gouge that money back from the taxpayer and charge interest on top of that.
It wants to have penalties when bills are not paid within 30 days. But ask anybody who does business with the government how often they get paid within 30 days of submitting their bill.
This is the same government that has chosen to ignore whether or not laws are passed in imposing costs on Canadians. It is out there selling a tax that has not even
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been passed through this House. It is out there across the land collecting higher unemployment insurance fees from Canadians, back to last January, when it had no legislative authority to do so, and yet refusing to backdate the benefits for which those higher fees are supposed to pay.
It refuses to give mothers, parents, adoptive parents the benefits that the new bill entitles them to have, it refuses to give the training benefits that the new bill entitled workers in Canada to have, despite the fact that it has been charging those higher fees since January and it is now November.
The government has pocketed millions and millions of dollars out of the pockets of Canadian workers, money that was supposed to go to pay for unemployment insurance when they are out of work. There are hundreds of thousands more of them out of work now. The government has pocketed that money. It has not improved their benefits. It has not improved payment. It has not improved training programs. It has had 11 months of collecting increased fees without providing one bit of increased benefits to workers. It has left families wondering whether they will qualify for parental benefits based on whether or not they have a child on November 15 or November 16.
If the government can go back and retroactively collect fees totally illegally, everybody out there fails to understand why they cannot go back and also pay benefits to which Canadians are now entitled.
The government can pretend if it wants that this is a simple, technical housekeeping bill. It is far more than that. It is an instrument of the same right wing agenda that we have seen now for six years. That agenda has left us in a recession, with rising unemployment. It has left Canadians without the ability to hang on to their own homes in times of high interest rates.
Perhaps the member opposite would like me to sit down so he can get up and speak for a little while. He is making an awful lot of noise over there, but not an awful lot of sense.
We have growing bankruptcies. For the first time, we have a government that has deliberately driven this country into a recession, that has deliberately deprived people of a livelihood, that has deliberately made it

November 26, 1990
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difficult or impossible for people to feed, clothe and house the family.
Finally, I want to repeat again what I said at the beginning of these comments. I do not see how this government expects those people to pay taxes and support the Government of Canada, expecting that they are paying for services that Canadians want, any level of trust whatsoever from the Canadian public when it deals with user fees, taxes, interest rates and Crown corporations, because this government is systematically dismantling the institutions of nationhood in this country.
The next election cannot come soon enough, and the defeat of this government cannot come soon enough.


Mr. David D. Stupich (Nanaimo -Cowichan):: Mr. Speaker, may I say first that I appreciate the action of the minister in speaking to me briefly before he presented this legislation, telling me of his plans to introduce it and saying some of what he said today, that is, the bill is almost entirely housekeeping.
1 am indebted to the research branch of the Library for having produced a study in quick order which endorses what the minister had to say, that is it is largely housekeeping without, of course, going into some detail.
I have taken the opportunity in the time that we have had to check with one of the labour organizations that represents a large number of government employees, and with the exception of a question relating to one of the sections, to this point, it has found nothing that would worry it as employees of the Crown.
Because of those facts and because of what I have heard about this minister to date from anyone who has had any dealings with him, I accept what he said at face value; that the bill is mainly housekeeping. This was confirmed by Library research, the opinion of the union members and, of course first and perhaps most important, the statement of the minister himself in a discussion that we had one afternoon and another evening.
I have some questions. This is sort of legislation that one cannot deal with really at second reading, because it just deals with, as the minister said, 70 different sections of the Financial Administration Act.
While I want to talk generally about it, I also want to raise some questions about some of the sections.
The minister mentioned not only that it deals with 70 sections but also that there was lengthy consultation. He did not say with whom he held the consultation. I would expect, from reading the legislation and the report that I have, that the consultation was entirely within the department and within Treasury Board staff itself.
I am not suggesting that there is anything wrong with that, but there will be an opportunity, I am sure, to ask at some later date when the bill is in committee just who was involved in the consultation and what kind of discussion there was.
During the course of his remarks, he suggested that when it comes to changing fees, for example, there would be further consultation with the people being affected. I am not sure just how meaningful that consultation will be. I expect when the minister or whoever makes a decision to change a fee-and on this I would agree with the member who preceded me-that if there is to be an adjustment of the fee, in all likelihood, it will be an upward adjustment. Any meaningful consultation will not really be engaged in, but it will simply be a matter of telling people why the government feels that the fee in this particular instance must be adjusted upward.
With regard to increasing the efficiency of service delivery, I do not believe the minister said that he was referring to the various recommendations that he has had from the Auditor General over the years. For some five years, the Auditor General has made recommendations and the Public Accounts Committee has made recommendations. I would suspect, from the reading I have done and from what I have heard, these recommendations have been more to urge increasing the efficiency of the delivery of service, than to try to adjust upward government revenues. Although, in the course of his remarks, the minister said that certainly one of the purposes of the legislation was to make a significant contribution to government revenue, he did not quantify that. I am wondering just exactly what that means, a significant contribution to government revenue.
I am aware of the province of British Columbia making some adjustments to fees over a period of about three years. When we added them all up at the end of the three years, we found out that these adjustments to fees were bringing in an extra $500 million a year. Significant
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is, indeed, the word to use in an economy or a government in a province the size of British Columbia, compared to the Government of Canada. If we are looking at $500 million in the upward adjustment of fees over three years, what kind of a total we are looking at for the Government of Canada? It could be extremely significant. In that case, of course, I am sure there was discussion with the people being affected, as well, but it did not have any downward effect on the increases that were being made.
I just do not know about the changes in land management. I suppose, from the reading of the proposed legislation and the library report, it is simply doing as the minister said and as the report says, providing in legislation for what is currently the practice. If that is the case, then I think it is welcome and it is time we did it. I have no reason for thinking that it is anything other than that.
When it comes to charging interest on overdue accounts, it is hard to argue against that. People should pay their bills on time. We have to pay interest everywhere else, why not pay interest to the government as well? I am not thinking of individuals such as you and I, Mr. Speaker. I am thinking of the large corporations which make a practice of cash management to the benefit of the corporation and stretch everything as far as they can, particularly when it comes to paying the government and they take advantage of that. In these cases, it could be a significant contribution to government revenue and one that I would be in support of.
Again, as I have said earlier, to the extent that it is dealing with recommendations from the Auditor General, we can all be happy that the government is finally moving to legislate the changes. Some of the changes have already been made over the last two or three years, but the legislation has never caught up with the changes that the Auditor General or the Public Accounts Committee recommended. It is good housekeeping and it is good to have it done so the government will be acting in line with the Financial Administration Act and the Financial Administration Act is in keeping with government procedures.
Clause 6 deals with the increases in fees for services. Of course, my question there is, just how much money are we talking about. With $500 million in the province of British Columbia, here it could be several billions a
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year that the government is talking about getting out of the economy.
We do not know where these fees are going to be increased and who this is going to affect. There are some fees that can be increased, and quite properly, from a commercial point of view. A Crown corporation or a government service that is strictly commercially oriented should be paying the cost of that, and an increase is reasonable. But sometimes, it is hard to differentiate between a public service and a commercial operation.
For example, while Canada Post is not one of the ones listed in the schedule in the notes I have, there is a difference within the corporation of the service that it provides to the extent that, for example, it distributes and handles junk mail. That is strictly commercial. That kind of operation should be covering the cost of delivering so-called junk mail. To the extent that it provides rural mail delivery, then there is a service involved. It is not a service that necessarily should be carrying its own way in every division. For Canada Post to be operating the way it does with a policy of closing down rural post offices, of cutting back on rural mail delivery, and of privatizing the provision of the service of rural mail, I think is not in keeping with a crown corporation that is designed at least in part to provide a service to the public.
VIA Rail is another good example. The operations of parts of VIA Rail were cut down or done away with when it was providing a service, not necessarily a commercially successful service, but nevertheless providing the transportation service of people and/or goods. That service is important to a country such as Canada, a country that stretches from east to west for some 4,000 miles and that needs that kind of a link to keep us an east-west country, as opposed to one where the transportation links might very well become north-south links without the tying together effect of a national railroad or a couple of national railroads.
Therefore, there are differences. We cannot say that a Crown corporation has to provide that service at a profit unless we look at the various sectors of the operation of that Crown operation. While we might admit that some services can be delivered at a price that will provide a profit, there are others where that should not be the case, where the government should be prepared to provide that service as a means of doing something for

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the people of Canada. I do not accept the principle that every Crown corporation has to operate at a profit.
When the government refers to adding corporations to Part 2 of Schedule III and that the corporations must be ones that are operated in a business way and that there must be a reasonable expectation of dividends, I have to wonder what corporations it is looking at. Does the government have in mind bringing in any particular corporations that are currently not being operated that way and making them profitable, first, by charging Canadian taxpayers enough for those services that those corporations will earn a profit? Does it have that kind of a program in mind or will it instruct those corporations to pay dividends to the Crown? If it does, it is simply another way of raising the taxes imposed on Canadians.
Some ten months ago in bringing in a budget, the government made much about saying that there were no tax increases in the budget. It forgot to mention it had imposed tax increases the year before, and even the year before that, that did not come into effect until 1990. While it did not, by legislation, bring in new taxes in 1990, it had brought in new taxes in previous years that became effective in 1990. Now, to say that it is going to do something else that, as I have suggested, could mean several billions of dollars of additional revenue for government, it it is going to take it away in dividends, while saying it is not increasing taxes, is not really telling the whole truth.
If one pays a little more for a postage stamp, in one's mind one is paying more to the government, even if it is a Crown corporation. It does not have to be called a tax. One knows that the government is taking more money and not giving anything back. Indeed, if we use Canada Post and VIA Rail as examples, it is taking more money away and giving less back. To say that it is not an increase in taxes is not telling the whole stoiy.
What other plans does the government have? I do not think this particular section is simply doing something that the Auditor General recommended. I do not know, but I do not think it is. It seems to me that the government must have some specific plans for making certain Crown corporations profitable to the extent that
they will be required to transfer dividends to the Crown, with a view of the Crown making more money without increasing taxes and yet taking that money out of the pockets of Canadian taxpayers.
I am pleased with one change that is being made and that is with regard to giving the government the authority to make payments by electronic means. It is makes it possible to make the payments more up to date, to be prompt with the payments, if you like, and to cut out some of the paperwork. It just makes it that much more efficient. I expect that that could well have been one of the recommendations of the Auditor General.
Among the important provisions are the requirements for regular reporting in corporate plans, budgets and annual reports, and extensive auditing requirements, including comprehensive and value for money audits known as special examinations. This was, of course, one of the recommendations of the Auditor General and on more than one occasion. It is well that this is now being provided for in the legislation. Let us hope that the government goes the next step, if it has not already-it may have done so in some instances-and actually does what it is saying it will do here in proposing this change in the legislation.
With respect to dividends paid by Crown corporations,
I have a list of corporations that paid dividends in 1988 and 1989. Canada Ports Corporation in 1988 had dividends of $100,000; and in 1989, $70,000. To me, that is an example of a commercial operation that could quite properly be expected to operate at a profit and to return at least a portion of that profit regularly to the Crown.
Another one is the Canadian National Railways which is being required by law to make dividends of a certain amount. This legislation is being changed so that it will not be that tightly tied to what the dividend should be. Dividends in 1988 were $56.5 million and in 1989, $41.2 million.
Canadian National, it would seem to me, more so than the CPR, has been in the business of providing a service because of the very long linkages of tracks to remote areas that it inherited when it became the CNR when it took over all the companies that went under. It was part of a national policy to provide rail linkage to a lot of
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communities throughout Canada, on the Prairies and in other provinces as well.
To say that corporation must provide specific dividends annually to the Crown is not playing fair with the Canadian people. If it is able to operate at a profit without decreasing the service to the people who it is serving, then, yes, I agree with it paying dividends. But a law previous to this change that is being made now required the CNR to pay these dividends every year. The only way it could get that money was to borrow it or to increase the charges on people who were expecting to get a service from this Crown corporation, rather than to have it operated at a profit.
The Halifax Port Corporation is another one. I think it is proper that the Montreal Port Corporation be expected to operate profitably and to make dividend payments.
Petro-Canada, nil. Of course, Petro-Canada has been discussed at some length in this House and probably will be again. It was an instrument of public policy. It is important that we develop energy resources in Canada. The government has chosen to bring in legislation to turn it over to the private sector. I am sorry this happened. I appreciate that I cannot reflect on a decision of the House. Petro-Canada did not pay any dividends. It was not in any financial position to do so, but it was making a significant contribution, on behalf of the Canadian people, of developing and helping to find and promote the development of energy resources. That was something that we needed in Canada, being the kind of country that we are, with the need for energy, and the fact that we use more per capita than any other country in the world. It was important to have an instrument of public policy that could be used in the energy field, in particular. It did not go far enough. It should not have been tied totally to petroleum energy. There were many other things that it should have been doing, but it had a record of not paying dividends, and it is small wonder.
The Royal Canadian Mint paid no dividend in 1988, but a dividend of $60.4 million in 1989. That is a good example of a commercial operation that could well be expected to operate at a profit and should be paying at
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least some of that profit to the Crown by way of dividends. I support that.
I am not opposed to the idea of Crown corporations paying dividends. I am opposed to legislation saying that they have to pay regardless of what they are making. I am opposed to them not being able to provide a service as part of their activities, but I am not opposed in general principle to some Crown corporations paying dividends. Clause 7 of Schedule III provided for the set dividend rate for Canadian National. This amendment would change that.
I have raised some questions about it. The most interesting one from my point of view is the one that I will be pursuing. No doubt this bill will be going to committee where we will have an opportunity to get into the details of the various clauses. The one I am really interested in is what the government is looking at by way of what the minister called a significant contribution to the government deficit. I believe that is the way he phrased it.
If this is a sneaky way for the government to raise a lot more money without bringing in legislation specifically saying that it is going to do some housekeeping with respect to the Financial Administration Act, and by that means trying to make a significant contribution to the government deficit, then I am opposed to that principle of the bill, if that is indeed the principle.
It is not spelled out. I cannot vote against the bill on the basis that it is designed, not to be housekeeping, but rather to make a significant contribution to the government deficit. I must say that I regret very much if the government is bringing in legislation such as this which in general is good housekeeping, but at the same time is going to use it in a way that it hopes will make a significant contribution to the government deficit.


The Acting Speaker (Mr. DeBlois):: Before resuming debate it is my duty pursuant to Standing Order 38 to inform the House that the questions to be raised tonight at the time of adjournment area as follows: the hon. member for Saanich-Gulf Islands-Environment; the hon. member for London East-Housing; the hon. member for Winnipeg North-Health.
Resuming debate.

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Leonard Donald Hopkins: Mr. Speaker, commenting on Bill C-91 today I have a number of points I wish to make, many of them pertaining to financial management or mismanagement thereof. Bill C-91 is an act to amend the Financial Administration Act and other acts in consequence thereof. If the average lay person is to read the contents of a bill of that nature and size, all I say is thank goodness for good researchers and advisers in this business.
Many of the improvements that are listed here have been recommended by public accounts committees over the years of their sittings in this House. A number of those have been accomplished recently by our public accounts committee. For example, there is the addition of sovereign loans that are unlikely to be paid are added to the national debt of Canada. Before they were just sitting there. Everybody knew that we would never collect many of those debts from foreign countries. It is a good move to bring those into the financial structure of the countiy, showing them as a national debt because undoubtedly we are going to have to cover them at some time in the future anyway. That has been a good move. It is one that the Auditor General has wanted for some time.
I have many comments that I want to make about this bill. While it brings out all the good points of government, we do not want it to be a cushion for the government to be spreading what it considers to be its good news and its updates and so on without also bringing in the basic and broad underlying weaknesses of financial management in Canada today. This bill is an act to amend the Financial Administration Act. It is a housekeeping bill in many ways on matters of a technical nature that have been evolving for the last five years in financial management and control practices of the government, recommended on many occasions by the Auditor General and the public accounts committee.
Many of these amendments are being made on recommendations of those two bodies. I congratulate the Auditor General on his very constructive remarks over the past number of years. I know that when you are in government you do not like the reports of auditors general sometimes. I sat on that side of the House for a number of years and I know what it feels like. It is very necessary in government to have a good auditor general and a good staff behind him. I think we are well served by the auditor general's organization, from all members of
his staff and the way they serve the House of Commons of Canada.
There is nothing inherently wrong with this bill. As I said, it is a housekeeping bill. It is in most cases merely legitimizing into legislation the things that are current practice anyway. Therefore, the Liberal approach to this is that we are quite happy to see these changes formalized, but there have been many areas of mismanagement on the part of this government and it has no reason to pat itself on the back.
The public debt has doubled in five years from $170 billion to $351 billion. The scary part of it is that in spite of all the increases in taxes and the rhetoric of this government, we are now on our way to tripling the national debt in this country. That is a very scary thing indeed.
The government missed the opportunity to make meaningful reductions in the deficit during five years of world-wide economic growth. This government had five years of the best economic growth in the country. Even at that, the deficit and the national debt in this country continued to grow by leaps and bounds. Yet they campaigned in 1984 by telling all Canadians how simple it was going to be to bring the national debt of Canada under control. They have succeeded in their six years in power in increasing the national debt in this country by more than it has been increased in any period of time since Confederation. Not much of a record to be proud of, Mr. Speaker.
The deficit is increasing, not decreasing as the government would have us believe. Let us take a look at the figures. The deficit has risen from $28.1 billion in 1987-88 to $28.7 billion in 1988-1989 and to $30.5 billion in 1989-90. Many efforts have been made to save the face of the finance minister. This is about the third major round of cutting the Public Service of Canada and there is a feeling out there that when they do that, they are hitting Ottawa and area.
Just to clarify that point, I want to say that three out of four public servants in Canada live outside the National Capital Region. They are spread all the way across this country from Halifax to the west coast and from the south of Canada to the Arctic circle. It is very easy to attack public servants because they cannot stand up and defend themselves.
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When you attack the Public Service, decrease the numbers of the Public Service, you can go around to those who believe that that is a great thing. You brag about it and say: "What a great fellow am I". Then they turn around and hire contractors to do much of the same work that public servants were doing before. They say: "We are saving money by doing this". Well, Mr. Speaker, just a few weeks ago we had the Treasury Board, the Privy Council and the Auditor General before the public accounts committee. I asked them specifically for a comparison of the costs of contracting out as opposed to the amount it would cost had those public servants been retained. They said: "Oh, yes, we can get you those figures."
It was not very long until I got a reply from them to the opposite. This is what Treasury Board had to say: "In connection with the information requested on personal services contracts which replace the use of public servants, the Treasury Board Secretariat does not collect such data. As far as we are aware, departments have not been gathering statistical data of that kind. We do not have data on what portion of the contract statistics that have been collected per the paragraph above would have replaced the use of public servants. Furthermore, our statistics would not likely incorporate all contracting out of services but only those captured by the criteria of the two special areas of interest."
On what grounds does any member of this government go around Canada saying: "We have decreased the Public Service from such a figure down to such a figure and boy, are we doing a good job." They say by contracting out they are saving money. Yet, they do not have any statistics to prove their point. That is just a bunch of rhetoric. It is really amazing what you find out. You are promised information. Then you find they do not have it.
When you cut the Public Service, you are not only downsizing the Public Service. You are downsizing the morale as well because people do not know when the hatchet is going to fall on them. This is not the way to get the best work out of your employees. The Public Service of Canada has been the scapegoat of this government on many occasions. This government is going to pay dearly for those attacks.
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Federal tax revenues have increased by $50 billion since 1984. This government has increased its tax revenues by $50 billion since it gained power six years ago. The finance minister has had more than enough tax increases to reduce the deficit, but he has failed to do so.
Because of high interest rates, the deficit will be $4 billion to $6 billion higher in 1990-91, unless the government takes additional action to raise taxes or cut spending. It is after everybody to impress upon them how important it is that it cuts the deficit and how important it is to downsize the national debt. It then turns around and brings in a high interest rate policy that results in adding $4 billion to $6 billion to the national debt of this country. It then brags about its great success in financial management.
The high interest rate policy is keeping interest rates in Canada more than 4 per cent higher than they are in the United States. A public debt of $351 billion is equivalent to a personal debt of $25,000 for each Canadian taxpayer. Each Canadian must now pay $2,500 in taxes each year just to pay the interest on the federal government's debt. The government is on its way to tripling the national debt, and it has only been in power for six years.
The proportion of the debt owed to foreigners-and this is a crucial point that many Canadians will not take any heart in-has doubled under the Conservative government, from 10 per cent to 20 per cent. Before these people came to power, 90 per cent of the national debt was owned by Canadians and interest rates were being paid to those Canadians. Now, there is another 20 per cent being paid outside the country.
High interest rates have caused Japanese and European investors to purchase Government of Canada securities. This means that more of Canada's future wealth will have to be paid to foreigners in interest, and the government calls this good financial management.
The Conservative policy has been to shift its deficit systematically to the provinces and to other levels of government. This is a serious situation. You are not cutting anything in Canada when you simply shift your problems over to another level of government.
Cuts to transfer payments to the provinces for health care and post-secondary education squeeze provincial budgets. Cuts to unemployment insurance push more people on to welfare, which costs the provinces and the municipalities more money. Federal spending cuts even-

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tually result in higher provincial taxes and higher municipal property taxes.
When people across Canada have a major increase in their municipal taxes and an increase in their provincial taxes, it may well be due to the fact that the federal government is unloading more of its debt and more of its administrative difficulties on to the provinces and on to municipalities in order to try to make itself look good.
On Friday in the House the Minister of National Defence said the government had no plans for emergencies or crises. Yet in 1988 this government passed the Emergency Preparedness Canada Act, which has been legislation now for over two years. We know and all Canadians know that this government does not prepare itself for any crisis. It is running helter-skelter from one crisis to another. The fact is this government has become the crisis in the eyes of Canadians.
Canadians have a plan in place to look after that crisis and will put that plan into operation in the next election. We will see a lot of changes on the other side of the House. I feel sorry for some of the back-benchers on the other side of the House because there are many good people over there. They will be drowned in the mismanagement procedures of this government, because they stand every day and support this government. If they stand and support something that is wrong, then they must be wrong too.
There is another item I want to mention. I have gone through the Public Service. We do not know how many more contracts will be let to do the work of the public servants who will bite the dust as a result of last Friday's announcement by the government. That is sad. This government should be ashamed of itself.
Just before it got the free trade agreement signed with the United States, the then Minister for International Trade, Pat Carney, who now in the other place, signed the memorandum of understanding bringing in that infamous 15 per cent export tax on Canadian softwood lumber going into the United States. She agreed to it, and she has recently been awarded a Senate position as a reward for her actions in attacking the forest industry in Canada.
That has hurt the Canadian forest industry since day one because American financiers assisted their forest industry in the northern United States, lent them money to build up their equipment and to improve their operations, and today they are able to compete very successfully. They are taking over what used to be traditional Canadian markets in the United States. We used to sell lumber as far south as Tennessee. That is not happening any more. We are having difficulty even getting it across the border. Thousands and thousands of people have been laid off in the forest industry in this country. There was a time not very long ago when 11 per cent of the Canadian labour force was employed in the forest industry of Canada.
Many companies have tried selling their products in Europe, in countries like Britain, France, Germany, and Italy where there is a good market for Canadian forest products. The problem is that it has been 90 or 120 days before they have their accounts receivable, get their money back. They have to go out and borrow money for their operations at the high interest rates of the Minister of Finance and the Governor of the Bank of Canada, Mr. Crow, who have no consideration for these people at all.
The government is pulling the rug from underneath one industry communities in this country. When that goes, the other infrastructure or the other service industries around it start going down too. Of course, by propping up these high interest rates, an artificially high value is being created for the Canadian dollar, which is hurting that export market as well. This is what the government calls good management.
I just want to say here that in the last meeting of the Standing Committee on Public Accounts, we went over an item with regard to external affairs, wherein the existing organizational structure and processes in the Department of External Affairs do not provide adequate control of moneys advanced to employees. The amounts involved, according to departmental records, have increased from $15 million on March 31, 1986 to $25 million on March 31, 1990. There is no management there at all. The Auditor General found that there is no
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clear accountability for monitoring, following up, and recovering amounts due to the Crown.
I have before me here a list of some of these accountable advances that have not been repaid, accounted for or recovered, and then details of accountable advances outstanding as at April 30,1990. These are advances that have not been paid back. On that list is a P. Carney with a 2 after it. What External Affairs is telling the Auditor General is that that person has two outstanding amounts of money owing to that department. Of even more interest, down at the bottom is the name J. Clark with 8 in brackets after it. That means he has eight accountable advances that have not been recollected. Some of these things are three years old.


Dave Worthy: Read them all out.


Leonard Donald Hopkins: If I wanted to read them all out, I would be here until ten o'clock tonight; they are all in there. A lot of this, I am pointing out, is due to inefficiency of accounting. The Auditor General says that there is no real accounting. Do we really know that these people owe the money? That is the question.


Some hon. members:: Oh, oh.


Leonard Donald Hopkins: Mr. Speaker, I have succeeded in getting them going over there. I want to talk about farm marketing boards because if we lose our farm marketing boards in Canada we lose our farmers. It is as simple as that.
Mr. Speaker, I want to thank you for your patience. I would like to go on and talk about the importance of our own food production and our own health controls in our food production in Canada. We cannot destroy our food production and then have to import artificial foods and all other kinds of things from abroad, where we do not have the direct control of the health services when those foods are processed.
We have it now in Canada. We have our farmers. For heaven's sakes, let's keep them.


Dave Worthy: Mr. Speaker, I listened to the last hon. member, and I have to say I was very disappointed.
His last couple of comments were not something that I would normally expect from him. To single out a former minister and a current minister of all the names that may be there with no explanation and to use it in the House is
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not something that I would have expected him of all people to be party to. I just have to say that I am disappointed. There has been a number of comments today by the last speaker as well as by several others on financial management. I sit here in horror when listening to how they describe it and end up somehow or other saying that this government is guilty of mismanagement, especially when it pertains to our deficit and our debt.
I remind hon. members opposite that when the Progressive Conservative government took office in 1984 the difference in the operating statement of the country- and I am not a fancy man with figures but I understand operating statements-between the revenue brought in and what was spent was $16 billion in deficit. The government of that day was $16 billion in a year more than it brought in.
This government has progressively tried to make a difference in that regard. The difference this year between the revenue we bring in and what we spend on operating programs is a $10 billion surplus. From a $16 billion deficit to a $10 billion surplus is called good management. It has been done through a combination of restraint on government spending as well as a judicious increase of taxes. There is no question. That is what this country needs.
I am not going to blame the Liberals for all the debt that was built up before, although they were the government. I believe that if as Canadians we are prepared to let a government continue to spend more and more, year after year, than it brings in in revenue, we as a Canadian people are responsible.
For a period of 15 years the people and the Government of Canada spent progressively more and more every year than they brought in in revenue. Since the Conservatives took office that trend has been reversed. In fact there is some hope for this country, some light at the end of the tunnel. That in fact is what I call proper financial management.
There are many more things to be done. There are many more things that can be done, but we have to give credit to the government that took the tough action to do what was necessary to have a $26 billion turnaround in six years. That is good, sound financial management.


Leonard Donald Hopkins: Mr. Speaker, I cannot get over the self-righteous attitude of the hon. member opposite. I am surprised at him. He talked to me about putting names on the record. I sat over there for a number of

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years and I know what was said over here, but I will tell him this.
The entire list of all these figures was before the public accounts committee less than a week ago. We discussed all this. As I said at the end of my speech, the accounting processes are such that we do not know whether they are paid, whether they are not paid, but they are there. There are pages of names, and we have to bring this out. But they are public knowledge. Anybody across Canada can read them, so the member should not say that is a terrible thing to do.
He says that they are making great progress with over a $30 billion deficit this year, much of it-$4 billion to $6 billion of it-caused by their own high interest rate policy. He should not start to scream and blame everybody else on a self-righteous basis.


Hon. John McDermid (Minister of State (Privatization and Regulatory Affairs)):: Mr. Speaker, I think the hon. member for Renfrew-Nipissing-Pembroke missed the point of my hon. friend, and I am going to bring it up again. The hon. member has been the chairman of the public accounts committee. He knows very well that the list he read from, when speaking about people who have outstanding accounts on travel advances, is a snapshot at any one time. I know he just mentioned J. Clark, when speaking about the Secretary of State for External Affairs, but he knew damned well who he was talking about and he did it on purpose. The minister goes on many trips on behalf of the government and at the time the account was audited there were outstanding accounts. The inference was that these were not being paid.
If the hon. member was honest with the House, he would also read the names of the members from his own party who happen to be on that list. My point is this. I would not name them anymore than I would name anybody else because, at that particular time, there are outstanding advances. I think we all, as members of Parliament, at some time have outstanding advances. A number of members of Parliament take three or four airplane tickets at a time so that if they have to make a trip in a hurry, they have an airline ticket. That is charged in advance. The hon. member should be honest with the House. He left the impression that these people
are not paying their accounts. That is very unfair, he knows it and I wish he would correct it.


Leonard Donald Hopkins: Mr. Speaker, obviously they have been so enthralled with their self-righteous attitude across the way, that they missed the entire point. I said that the accounting procedures are so bad that they do not know whether the bills are paid or not. One can read these names all night long. Even the minister knows these are public knowledge. The minister says that one should not do so, but is it wrong to discuss something that is public knowledge? Is it wrong to say that some of these are perhaps paid and some may not be. I said that at the end of my speech. The accounting procedures are so bad that they did not know which ones are paid and which were not.


John Horton McDermid: I see.


Leonard Donald Hopkins: The hon. minister is so busy shouting and screaming that he does not have time to listen. If he had been listening, he would have heard that. But the minister's comments always lead him astray. I do not see anything wrong with discussing in this House what is public knowledge.


James Scott (Jim) Peterson: Mr. Speaker, would the hon. member tell us if he has any evidence that the Minister of Finance is borrowing money. If not, would he assume that this is because, even the minister, himself, feels interest rates are too high?


Leonard Donald Hopkins: Mr. Speaker, when the Minister of Finance puts interest rates so high, they become attractive to investors in Japan and other countries that they start coming in here and buying up our securities then, naturally, we are going to have all this debt transferred to the foreign marketplace. This is dangerous to Canadians. If you are paying interest to Canadians that is one thing but, when you pay interest to foreigners, that is a different thing.
Canada was in a much better position on this than was the United States. Just a short time ago the Americans were paying far more interest to foreigners than they were to Americans. We, in Canada, do not want to continue that procedure here because, if we ever get into a position where we are paying more interest out of the country than we are paying to Canadians inside of the country, then we are in serious shape. At the time this government came to power, 10 per cent of our debt interest was being paid outside of the country and now 20 per cent is being paid outside of the country. By
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increasing the interest rates, the Minister of Finance is destroying his own case.


Stanley J. Hovdebo: Mr. Speaker, I want to take the opportunity to speak to this bill because I think that this particular piece of legislation is much more important than has been indicated and is much more than bare housekeeping. Within this bill is the expanding of authority or power, giving it to the Treasury Board, taking it from other ministers and other acts. It is put into the area of an Order in Council and regulations under the Treasury Board.
When the minister let slip that this was going to be one of the pieces of legislation that was going to help to eliminate the deficit, he really meant that, because within this particular piece of legislation is the authority for Treasury Board to define what is a service. There is no definition of a service or a facility in the bill.
If that is looked at a little more deeply, it will be found that that can mean a considerable amount more than would appear on the surface. The umbrella legislation is the Financial Administration Act. It affects every department and ever}' movement of funds between departments. It is umbrella legislation under which the government is supposed to be able to control the financial structure of its operations.
If the operations which are presently the responsibility of every one of the departments are centralized under the Treasury Board, and the government decides it wants a 15 per cent or a 20 per cent increase, it can do it right across the board without any problem at all. It does not have to go to each minister or act to get the authority under that act to change the regulations because it can now be done centrally.
I think that is the danger of this particular piece of legislation. It puts into the hands of the Treasury Board and the cabinet much more power than they have had in the past. It is the kind of power which allows them to fleece the citizens of Canada without coming to Parliament, or without going to the department which knows the most about the particular charges that are being made. It gives the Treasury Board the authority to define what a service is and how much should be charged for it.
A little later on, Mr. Speaker, I will point out the kind of things that I think this may turn into if the government wishes it to.
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I want to spend a little bit of time going over a couple of things in the bill that I think prove my particular point. Clause 6 which amends section 19 of the act says:
The Governor in Council may, on the recommendation of the
Treasury Board,
(a)	by regulations prescribe the fees or charges to be paid for a service-
No definition of a service.
-or the use of a facility provided by of on behalf of Her Majesty in the right of Canada, by the users or classes of users of the service or facility; or
(b)	to authorize the appropriate Minister to prescribe by order those fees or charges, subject to such terms and conditions as may be specified by the Governor in Council.
In other words, if I read this correctly, it takes out of the hands of the minister and puts into the hands of the Governor of Council and the Treasury Board the right to collect any fee on any service and any facility that has anything to do with the Government of Canada.
I wonder if we realize how many times we have touched the Government of Canada and if this kind of power is given to the Treasury Board they can charge us for it? I do not think it is nearly as much of a housekeeping bill as the minister has indicated.
I want to spend a minute on the schedule relative to interest. It is interest on money owed to the government. This bill gives the authority to the government, to the Treasury Board, to charge interest on any fee or debt that is owed to the government by any citizen of Canada or any corporation that owes the Government of Canada.
At present that ability, as far as the government is concerned, is in the Income Tax Act as revenue but it is not part of any other act. Mr. Speaker, if you have tried to collect interest from the government, you will find it is impossible. I hope that this particular indication that the government is now giving itself authority to charge interest on something that is owed to it, that it is going to reciprocate. If one has waited for six months or six years, as sometimes happens, for the government to pay a bill, one should be able to charge interest on it. Tty to do it now, Mr. Speaker, there is no way that you can charge interest on a bill, regardless of how long the government has had it in hand and not paid it.

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I have cases in my files where the length of time has been years. I have one case where the government did not pay a bill for six years. In this case, a corporation which did some turfing for the government has collected only the basic bill after six years. If the government is going to have the right to collect interest on money owed to it, then it must also give the right to Canadian citizens to collect interest.
I am a little worried about the section on collection agencies. Knowing the basis under which this government has given out contracts to work for the government, if one is a private individual, it would appear to me that this opens up a tremendous area for the friends of the government. This could result in more patronage without any control over how much the government is going to pay for that service.
The government is going to give the collection of money over to lawyers or collection agencies. I mention the Farm Credit Corporation. Only a government supporting lawyer may apply. I have a feeling that when it comes to a collection agency or a lawyer working for the government, only if one is a government supporter may one apply.
In the Farm Credit Corporation the lawyers know the business so well that the day the government changed, the lawyers turned over their files. I think that that needs to be looked at very thoroughly and we must look at it very closely in committee.
The right of remission is also in this bill. The right of remission is always there, of course, in money that is paid to the government, at least in most cases. It is there statutorily. For instance the automobile companies in Canada used to pay duty on parts coming in from the United States. Statutorily, once they had fulfilled the requirements of the auto pact, they got back the duty that they had paid. What happens in this bill is much more open again to finagling, manipulation and patronage because the decision as to whether or not there shall be remission is not statutory, it is in the hands of the minister. We should look at that very thoroughly.
My friend from Renfrew has gone, but I want to point out that section 20 of this act may be put in there for a particular reason. Section 20 gives Treasury Board the
authority to collect from people who fail to pay back money owing to the Crown. That list of people who had advances and neglected to pay them back can, under this act, be collected from, so it is not all bad. I must say when I get to that point, that it is not all bad.
There are a lot of things in here that I, and other members of the Public Accounts Committee have pointed to over the years as needing to be cleaned up. A lot of that has been done in this act. I have not had much time to go through it, so I hope that in that sense the minister is correct and that there is a lot of housekeeping in the act done to allow the government to operate a little more effectively than it has in the past.
On page 11 of the act, there is a clause on lapsing. The Financial Administration Act in the past required that if a department still had money in its coffers at the end of the year, then that money lapsed and was returned to the General Revenue Fund. For a civil servant or a director of a particular department, that is annoying and causes a tremendous amount of expenditure during the last month which is usually not good expenditure, but it did have a certain quality in that the control of the financing was there all the time.
Many civil servants will be very pleased with this change, but I wonder about its value and whether it should really be in here. It states that at the end of the fiscal year the money will not lapse in quite the same way. Money unexpended at the end of the fiscal year, after adjustments for the recording of debts incurred and other amounts due and owing, referred to in Section 37(1), shall lapse. It lapses except for the amount that you can show you owe. There is no department, corporation or agency that is going to go into the next fiscal year without making sure that anything that is possible to be charged for last year will be put on that account.
There is only one other area I want to cover, and that is the section on Schedule III. Earlier, I suggested that the definition of services and the definition of the fee would be left up to Treasury Board. The definition of the service covers a much larger area than you would expect. I will only use some of the examples in the act because there is no limitation to these particular areas of control. The act allows any department any kind of service, but they are not exact.
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It allows the establishment of fees under the Aeronautics Act. In flying around in the northern part of the country, either in the provinces or in the Northwest Territories, one depends entirely upon the navigation assistance available to one at no charge. Is that going to be charged? Or, is any kind of flying assistance going to be charged? At the moment, no, but if the government decides that it wants to eliminate the deficit fast enough, it may charge for the air one uses, as it has some responsibility for it.
There are multiple services that are made on agricultural products. With regard to inspection fees, if one is selling grain, there are grading responsibilities and the grain commission. There are inspection fees for meat and seed grain, the certification of seed grain, the certification of particular breeds of animals, and the importing inspection. All of those are services which have been sometimes charged for, but, most often, not. This would allow Treasury Board to start charging for all of those services. It should charge at the level that it thinks the traffic can stand.
I am sure that the government thinks it is being reasonable, but the people who really know what is going on are the people who are working with these agricultural products. The Department of Agriculture would be the logical people to do it. I would hope that it would do it jointly. When done under the Department of Agriculture, it is required to put it as part of the appropriation bill. This does not even require that. If I understand this correctly, it will no longer have to be made part of that appropriation bill as it is presently.
Under the Canada Pensions Act, the Unemployment Insurance Act, the Financial Administration Act and the Petroleum and Gas Act, Part III is repealed. This leaves me at a loss because I do not know what Part III is. That is the kind of thing we are being faced with. This bill came out a couple of days ago. No one has been able to go through it as thoroughly as we should have been able to do.
One section refers to the national parks and determining or describing the manner of determining fees, rates, rents and other charges for use of resources and facilities in parks for issuance of licence and permits for the provision of service materials and works. That is going to
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become part of the responsibility of the Treasury Board. Is the Treasury Board the place where that should be? I think not.
In the case of the Canada Shipping Act, for instance, is de-icing a harbour going to become one of the things that is chargeable? Is search and rescue going to be one of the areas that is going to be chargeable? If one's husband disappears while out at sea, is the seaman's wife going to be charged for search and rescue? Under this act, it is possible.
Mr. Francis G. LeBlanc (Cape Breton Highlands-
Canso): Mr. Speaker, I am happy to participate in this debate on Bill C-91, the amendments to the Financial Administration Act and other acts in consequence thereof.
I recognize, as do other members of my party, that this bill is primarily a housekeeping measure. Essentially, it implements in the way the federal government manages its finances, its cash, and its billing procedures and collection of accounts, recommendations which have been already made over the last few years by the Auditor General, the Comptroller General, and the public accounts committee. Therefore, it modernizes and brings up to date various aspects of the financial management activities of the government. In that respect, we are certainly not opposed to that practice.
However, there are a number of aspects of the bill which lead to questions, particularly as they interact with the whole regulatory process of the government. Here we have legislation through which the government presents its policies, some of which involve increased taxes or increased charges of user fees and which are debated here on the floor of the House of Commons, and in many other areas, particularly those that have the designation of Governor in Council or approval through Treasury Board, through Governor in Council or which, in effect, involve regulatory changes. They do not get debated on the floor of the House of Commons necessarily, but in fact are introduced quite surreptitiously by pre-publication in The Canada Gazette. Following a short notice period, they then become regulations and have the force of law for those people who are affected by them.
Some of these regulations can be very complex and can be very difficult for the member of Parliament and for professionals, let alone the ordinary Canadians, to un-

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derstand their import and to be able to comment on their impact before the regulations come into force.
One provision in particular that I have noticed in the bill that we are discussing today, combined with these regulatory powers that are available through the Treasury Board and through the Governor in Council, has a major effect on a program and a charge which applies to a large number of municipal units and voluntary agencies across the country. It is on that point that I would like to develop my argument this afternoon.
The clause that I am dealing with in the bill is clause 6, which amends section 19 in the Financial Administration Act. It broadens the application. Clause 6 would repeal Section 19 and substitute the following for it:
"19.(1) The Governor in Council may, on the recommendation of
the Treasury Board,
(a) by regulation prescribe the fees or charges to be paid for a service or the use of the facility provided by or on behalf of Her Majesty in right of Canada by the users or classes of users of the service or facility-
There are other clauses that essentially broaden the range of services and user charges for which the Treasury Board or the Governor in Council may prescribe regulations. One of the additions in the bill, as I understand it, is that while broadening the category of user charges, the bill also includes rights or privileges conferred by the Crown by means of a licence, permit or other document, and these also may be subject to user fees and charges and subject to regulation which would be introduced without going through Parliament, but merely through Governor in Council on recommendation of the Treasury Board.
There is a case now that will have a devastating impact in my constituency in particular and many other constituencies of a rural nature in Canada which has to do precisely with this point. I am speaking of an act which was introduced in the last Parliament, the Radiocommunications bill, Bill C-3 which in effect made changes to the Radiocommunications Act to increase user fees and licence fees for those in the public sector who used radio services and had radio licences.
What the Act did was enable the government to charge fees in a broader category of users of radio
licences. The minister, at the time, assured this House that these additional charges would only apply to provincial and federal government agencies. They would not apply, for example, to municipalities that have radio licences for their use for local police protection, search and rescue, fire protection, emergency measures and they would also not apply to voluntary agencies, agencies like fire departments which are comprised of volunteers and perform the same types of services on a voluntary basis often over a wide area and for which there are no charges for these services.
The then Minister of Communications exempted municipalities and voluntary fire departments from those additional charges. What has happened since the election is through the regulatory route, the Minister of Communications has introduced by regulation, by Governor in Council, through the Canada Gazette in January of this year, and with very little contact in particular with the voluntary fire departments, which are most affected by this measure, provisions to the Radiocommunications Act regulations, drastically increasing licence fees for municipalities, voluntary fire departments and imposing an incredible burden on those organizations which are composed of volunteers in rural areas and do not have the funds to meet those obligations, but require radio licence fees to perform their essential tasks.
This regulatory change, which was permitted one month of pre-publication through the Canada Gazette, is a most arcane and complex piece of regulation, combined with a schedule which would require a whole company of accountants a month to figure out, let alone the fire departments that were affected. Of course, it went right by the voluntary fire departments that were most affected. They have discovered since then that they are now saddled with an enormous increase in their radio licence fees.
For example, the Strait Area Mutual Aid Association, which is a group of 25 volunteer fire departments located in the area around the Strait of Canso, paid licence fees last year which totalled $236. With the passage of this regulation in February, without their knowledge, they are subject since April 1 of this year with a licence fee for their radios of $8,574 for this year. That is something like a 3,600 per cent increase in their radio licence fees. Next year, that is to say the 1991 fiscal year, they will have to
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pay an additional $8,574 or $17,148 for their radio licence fees. They are unable to meet that charge.
What is going to happen, and this illustrates the false economy which this government in slavishly attempting to apply this principle of user pay across the board to voluntary fire departments, voluntary mutual aid associations, local police forces, and municipal governments, is this will shut down municipal fire protection and search and rescue in rural areas, such as my constituency.
These services are essential. These people, for no pay, at considerable expense to themselves and risk to their lives and a major time commitment, provide fire protection for people's homes and for the few federal government buildings which exist in rural Canada, Search and Rescue which means safety for many people who are lost, and a whole range of other services.
What is going to happen if this is allowed to go forward is that these services are going to diy up. The government is going to have to replace them with paid services made up of paid firemen and paid local search and rescue organizations. The cost of these services is going to skyrocket and the fabric of these communities will be weakened. This is happening through a regulatory process which will be made easier by the amendments in this bill. I want to underscore the importance of this particular proposed measure being withdrawn and, if it can be done through this legislation, it has to be done.
I want to give a personal example of how important this is. In 1981, long before I was a member of Parliament or had even contemplated being a member, I was home for Christmas. On Boxing Day, I went cross-country skiing with my brother. We got lost in the woods. If it had not been for the voluntary efforts of our local search and rescue organizations in the area of Margaree Forks, from where I come, and the surrounding communities of Cheticamp and Inverness and the voluntary fire departments, using radios to communicate and to search, at night, in the woods behind our place to find me and my brother who were completely lost in the woods, we would be dead, frozen corpses, and I would not be here to make this point today.
That is the kind of service which these voluntary agencies provide and which is going to be completely
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scrapped if theses exorbitant radio licence fees are allowed to go through. These licence fees applications have been introduced and mentioned in The Canada Gazette, without being considered at all in the House of Commons. They went through the regulatory process. I do not, in principle, object to the fact that the government permits the Governor in Council to issue regulations. That simplifies the legislative process and, of course, there are many things which cannot possibly be put into legislation. I am not objecting to that principle but I am just saying, relative to Bill C-91 in particular, the new expanded clause 19 in the Financial Administration Act, which that bill will allow for, is going to expand the powers of the Governor in Council to introduce the kinds of regulations which the Minister of Communications issued earlier this year. This is going to make it absolutely impossible for mutual aid, fire departments, and rural municipalities to perform basic functions which are essential to those communities and which are now provided on a voluntary basis by these community groups. This relates directly by the channel of the regulatoiy process to the financial management provisions which are contained in this legislation.
Once again, Mr. Speaker, while I am not opposed to the principle of updating and modernizing the financial and cash management practices of the government, particularly as they have been found deficient by the Auditor General, the Comptroller General or through the hearings of the public accounts committee, I do believe that this particular aspect of this legislation ought to be gone over again in light of those very Draconian fee increases introduced by the Minister of Communications for radio licence fees earlier this year and which are really going to hurt voluntary organizations in communities in my riding and also, I suggest, in many other communities that are of a rural nature across Canada. They cannot bear these fees. They are going to be unable to function if they are going to be saddled with these fees.
That is the main point I want to raise in connection with Bill C-91.1 would ask that if this bill goes forward to committee that that clause in the bill be given very careful scrutiny in light of the points I have mentioned.

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Ms. Ethel Blondin (Western Arctic):: Mr. Speaker, I am very pleased and honoured to rise in the House to speak to Bill C-91, an act to amend the Financial Administration Act.
If any one part of the country is impacted by the Financial Administration Act as administered by the federal government and to be adhered to by the various jurisdictions in this country, it has to be the Northwest territories. The government of the Northwest Territories, as you well know, is governed by the NWT Act and the government of the Northwest Territories is not a constitutional entity unto itself. It is in fact an extension of the federal government and is so managed.
On April 1, 1990, a new formula financing arrangement went into effect between the federal government and the government of the NWT. The immediate financial impact of the new arrangements is the reduction of the 1990-91 grant to the government of the Northwest Territories of about $25 million. Over the next five years, the reductions will amount to about $110 million. Not only are these cuts damaging to the NWT's fiscal position but the new formula contains serious flaws which will limit our ability to develop the northern economy.
It is particularly serious in that the Northwest Territories, at a time when the goods and services tax would definitely be an imposition and the high interest rate policy dominates all discussions on the economy, the new unemployment insurance bill, which definitely impacts the north because of the high seasonal employment situation that exists there, will have devastating effects on people in Canada's north.
Essentially it is to say that any kind of legislation that comes from the federal government definitely has an impact on the north in a disproportionate way than it does in any other region of Canada in that the ties are very close. Although we have an act that we are governed by, we definitely are still an extension and we still have these huge transfers that we have to adhere to strict regulations to manage these resources by.
Having said that, I guess we could assume that in the territories we have been virtually taken off the transportation grid. There have been major cutbacks which will have a very devastating effect on the north, in that the north has a very high cost of travel for its public. Essentially, most of the travel is by air and most of the
communities serviced are by air travel. There really is not the kind of infrastructure that exists in other parts of Canada.
As far as the communications grid is concerned, I guess essentially the million dollar cutbacks referred to in the budgetary cutbacks of a few days ago will definitely have an impact on the voice that the north has through this particular mechanism to communicate.
In terms of communications and the Financial Administration Act, I suppose the north would be in a position, as would every other community in the south, to be on an equal playing field in terms of its infrastructure, but the north lags behind.
In the last two months Gordon Wray, the Minister of Tourism and Economic Development for the Government of the Northwest Territories, stated in terms of a major transportation strategy he presented to his legislature: "Our transportation infrastructure lags far behind anywhere else in Canada and must be improved. Our lack of adequate roads, airports, docks and harbours handicaps our economic growth. A better transportation system will create opportunities for mining, tourism, fishing, trade and travel between communities".
This is a major concern of the territories. Finding the investment dollars for communities in the north would be a major consideration for this particular portfolio and this particular minister. It is of the utmost importance for this particular government to have the moneys to administer in a responsible way under the Financial Administration Act. It should be able to get returns instead of always playing catch-up and trying to build an infrastructure at the same time, which is degrading.
What I mean by that is that the strategy includes major program initiatives and a substantial financial commitment. The minister states that at current levels we would spend some $1.65 billion over the next 20 years on transportation. Achieving the four strategic objectives would require expenditures of $4.32 billion, representing an increase of $2.6 billion.
In the fiscal arrangement or the new formula financing arrangement that went into effect on April 1, 1990, it seems very hopeless to put forward any kind of an economic initiative for the north when we have the kinds of arrangements that are essentially going to degrade the future economic prospects of the north by $110 million over the next five years. The reality is that this is
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definitely a need. This is something that is undeniable to the economic well-being of the north.
The Government of the Northwest Territories has assumed a significant role in the northern transportation mandates. Northerners will be the recipients of the economic, social and political benefits of the transportation strategy proposed by Mr. Wray. The Government of the Northwest Territories, therefore, must be prepared to contribute a substantial share of the required investment. However it should not be alone.
The minister goes on to say in a further statement that the transportation strategy will be a catalyst for the economic, social and political development of the Northwest Territories into the 21st century. It will benefit current generations of northerners and Canadians and establish a legacy for the north.
He also says that despite the fact that the GNWT has signalled its commitment to transportation as a catalyst for the long-term economic, social and political health of the north, the scale of investment required cannot be made without the participation of Canada, the provinces and the private sector. These partners will be shareholders of the benefits. They must also be prepared to share in the investment.
Having said that about the whole infrastructure of the north, I want to mention a number of other important realities that my constituents in Western Arctic are faced with in dealing with this fiscal arrangement as governed by the Financial Administration Act and the federal government in the relationship they have to deal with these major funding transfers.
The reality for my constituents is that they are faced in their everyday life with the need for economic security. Not only are they beyond the communications grid and the transportation grid, but basically the north is in the pre-industrialized setting. Having reflected on this a bit, I would say that everybody who knows Canadian history knows that it was fur that built this country.
As of late that particular industry or traditional economy has fallen on hard times. It will probably be the lowest return for hunters and trappers in that particular area. They are severely impacted by whatever kind of budgetary decisions are made at the federal level in
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arrangements with the territorial government. Territorial communities, all 39 in my riding, are essentially in a pre-industrialized area. They do not have the kinds of opportunities that southern communities have. They do not have the same opportunities when it comes to businesses and the infrastructure that is needed. They do not have the opportunities to pick and choose the kinds of services that are contracted and the kinds of goods that are imported and bought. It is all very costly for the people in the north.
Turning to the need for economic security and the need for public infrastructure, all the while with high regard for the environment, and the need to settle some rather major land questions that have gone by the wayside, the Government of the Northwest Territories is fully cognizant of how it should in fact relate to the Financial Administration Act.
In the information released by the Auditor General, it was clearly stated that land use planning in the Northwest Territories had expended millions and millions of dollars, yet there was no clear mandate or policy expressed by the federal government for this particular area. This is something that is totally negligent and unacceptable.
There are other areas to which I should refer. When we talk about the collection of debts on behalf of the government, they say not to make specific reference to taxes, but in my particular area there is a mechanism called grants in lieu of taxes. In this particular area there are communities which have been saddled with debts that have accumulated.
The collector is no longer the federal government but municipalities. Municipalities have been imposed upon and have been asked to be the tax collector. This is quite unfair. This is something that many of the communities are grappling with. Many of the groups are small communities that have never had a tax base.
When you live in a harsh climate where you do not have an appreciation of your property, you do not have adequate infrastructure and you do not have the kinds of goods and services that would warrant that kind of a tax base, it is somewhat of a gradual transition for those people to get accustomed to what used to be referred to as a grant in lieu of taxes situation. The federal government used to be able to give those communities grants as almost an approach of forgiveness for those taxes that

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were accumulated by those particular residents. Now that responsibility has been turned over.
In terms of the Financial Administration Act, there is a gradual move with the increased responsibilities that the territorial government is taking on toward it taking over the responsibility for being more accountable.
There has been a number of financial arrangements. The territorial government used to have what I think was termed vote 4 moneys, and it was required to do a very strict accounting. One example was the French language services that were going to be introduced in the Northwest Territories. That particular financing arrangement for the vote 4 moneys was done on an annual basis. It was a very cumbersome process which needed to be overhauled.
In terms of the Financial Administration Act, if we want to have delivery of services in those particular areas and to have those particular programs meet their legal obligations, just last week the N.W.T. Act had to be amended because we could not meet the requirements set under the Official Languages Act to translate all the bills and statutes. Therefore I think that a more practical and a more reasonable approach has to be taken rather than an annual funding arrangement. What has to be engaged in is a multi-year operational program for French language services.
In conjunction with that we also have another area of concern. In 1984 the GNWT had a $16 million grant given to it for the introduction of French language services as a trade-off for the aboriginal languages of $16 million. What has happened with that is that it is coming to an end. After they have in fact reprofiled the unspent moneys and that time has expired, we will need to renew this particular commitment because it has become a world-class model for indigenous languages and the way the services have been expressed in terms of the use of the money responsibly under the Financial Administration Acts per se. It is a model, something that the federal government should be proud of and something that the territorial government is proud of.
It is definitely something that is worth the investment. I think it has been worth every penny that the federal government has put into it and has been managed very responsibly. There have been people who have gone in to
appraise that work, and I think it will stand the test of time and stand the test of responsibility.
I have a number of other points, if you will bear with me, Mr. Speaker, in the area of transportation. As I indicated, we are off the transportation grid. I hear some very pleasant rumours that perhaps the government is reconsidering the area that is going to have to cancel its medivacs because of a lack of air safety and a communications budget of $35,000. I am sure the government does not want to consider putting a dollar value on the lives of my constituents and those northerners who should be afforded the dignity and the right of travelling safely, especially when there are no other ways of travelling than by air.
Another point in terms of communications is that it was very sadly regretted by many of the air industry officials that the Weather North Program was cancelled. This was a program that was headed up by CBC. It was very much valued by many airline industry officials in the north. It was $400,000, and I must say that investment was worth everything to the people who have to travel and work under the most adverse conditions.
I would say, just as a last statement, that in the area of tourism, in the area of the high cost of travel, and in the area of small businesses any kind of assistance that the federal government could give to the reality of the future of the north will be felt. It would be one of continuing to support the north and continuing to invest in the north.
Canada is a northern country, and that northern country is truly actualized in what exists beyond the 60th parallel. The government has to take a second look and continue its commitment to put money into the transportation strategy as proposed by the Government of the Northwest Territories, to reinstate the Weather North Program, to put money into air safety, and to invest in tourism initiatives which make Canada truly a northern country. So I say to the rest of Canada and to the government that every Canadian and every part of Canada must be given an equal chance to participate fully in our country. The north must not be economically marginalized when it comes to the Financial Administration Act. I think you will know in years past that the N.W.T. was essentially punished for having a surplus. They were fiscally responsible, they managed their
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money well, and they set priorities in a way that was quite responsible.
Having just come back from the Yukon, I would say that another area where perhaps the government could express a bit of latitude is the kind of moneys that it puts forward for the implementation of the Yukon land claims. The people in the Yukon would like to have some say about how an implementation plan for their land claims is expressed. Right now they have a working group that works from the top down and expresses perhaps what they feel the communities need because they do not have the resources to go to the community and to express and perhaps extract from the people at the grass roots level what it is they want in an implementation plan.
Perhaps the federal government could express a bit of latitude and generosity of heart in allowing those people to truly define from the grassroots level. The Canadian public at large is calling for participation at the grassroots level. Perhaps this is an opportunity for the government to make a symbolic gesture in both territories to adequately fund these people. I think they will know that under the Financial Administration Act these people are very responsible and very accountable.


Mr. Charles A. Langlois (Manicouagan):: Mr. Speaker, I listened with a great deal of interest to the comments by the hon. member for Western Arctic. I would like to take a few minutes to draw an analogy, to compare her constituency with mine, the riding of Manicouagan, which extends nearly 700 miles along the coast of the north shore of the Gulf of St. Lawrence, where over three-quarters of the villages and the people who live there are not connected by roads. The only means of transportation is by plane during most of the year and by ship in the summer. There is also the northern part of my riding which borders on both shores of Ungava Bay, where Inuit communities have been living since time immemorial, and there again, communications are extremely difficult.
I must say that I can identify with her comments and her description of the difficult conditions under which
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many of her constituents were living. This is a situation our government is trying to correct with every means at its disposal.

Would my colleague from Western Arctic agree with me that the best way to assure proper financial intervention by the federal government in all aspects she talked about, such as providing additional sums and means for the population in the northern region and remote areas such as in her riding and in my riding, the proper way to ensure that the government can intervene is through sound management of the financial assets that the federal government has. By managing properly, money that the taxpayers of this country provide to the government will enable provision of additional financial means to the people and to the area she just talked about, an area that we both represent.
Does she agree with me that Bill C-91 is a modest way to go in the direction she talked about? I am sure she would want to support this bill and other measures that this government has taken, is taking, and will take in the future to better manage the taxpayers' money, so that it can distribute more wisely and more equitably the sums of money the federal government has.


Ethel Dorothy Blondin-Andrew: Mr. Speaker, I thank the member opposite for his question. It is a rare day that I am able to compare notes with members opposite who agree, to any extent, on any issue that I bring forward. I am quite happy to hear that we have in common, I guess, the remoteness of our communities in terms of transportation and communication. The sad part is that those services need to be met. I cannot speak for the communities of the hon. member opposite and the jurisdiction that he comes from, but I have to say that I know that the territorial government has been very responsible.
The territorial government has acted quite responsibly under the Financial Administration Act. Essentially, their budget has been cut back because they had a surplus. They were very cautious not to overspend their budget. There is no way under any fiscal arrangement that the territorial government would be deemed to be irresponsible.

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As I indicated, as of April 1, 1990 the new formula financing agreement that went into effect is, over the next five years, going to cut back the N.W.T.'s budget by $110 million. In light of their needs, because of their remoteness from prime North American markets and from southern centres that offer a better price for service and product, they are going to be punished. They are not going to be rewarded for being responsible. This does not mean that I wish them to be irresponsible. Under any arrangement, the government and the jurisdiction that I come from have been extremely responsible.


Ronald MacDonald: Mr. Speaker, I am pleased to speak for the second time today. After the break we had two weeks ago, I guess I thirsted for the battle. I am getting my fill today.
It is a good day to get up and speak on this bill, which is primarily a housekeeping bill. It enacts very technical changes and requirements to the Financial Administration Act. Before I start my speech, the hon. member opposite who just asked the last question, asked my colleague from Western Arctic a question. What he was looking for were some bouquets on the government's financial management ability of the fiscal resources of the nation. He might have been fishing in the wrong direction. I cannot say that this piece of legislation is bad. It is a technical piece of legislation. It tightens up some loopholes. There are a few things I find terribly wrong with it. I will deal with that because it reflects an error in policy direction that the government has taken.
The hon. member opposite asked my colleague from Western Arctic whether or not she thought that this government had made some modest steps towards proper financial accountability and proper management with the fiscal resources of the nation. I would like to put a case forward to prove that it is not just technical amendments to law that indicates what should be a benchmark of whether or not a government is fiscally managing itself properly, but other things like ACOA. ACOA is an agency that is not directly dealt with in this bill. The bill deals with Crown corporations and the like. I want to talk about ACOA and by doing so, perhaps I will answer my hon. colleague's question.
ACOA is a Crown corporation. It has a budget of $1.05 billion. When it was created, it was supposed to be new money. In a subsequent budget about a year ago, the
Minister of Finance indicated that in the area of fiscal responsibility, the government was going to extend the mandate of ACOA from five to seven years, which effectively is a 20 per cent cut. It could not get the word cut out of their lips, although everyone who looked at the amendments or the changes knew that it meant that Atlantic Canada, over that five-year period, would have 20 per cent less money to spend on economic development. Over and over, in my previous capacity as regional development critic and the critic for ACOA, I would ask the minister responsible for some accounting of how he and his officials were spending that $1.05 billion.
Repeatedly we got bafflegab and every type of distortion and diatribe so that the questions would not be answered.
Here is a case in point, a company called NSC Diesel. It was funded through ACOA. That is taxpayers' money. Do you want to talk about accountability? I asked the minister, many times, questions on NSC Diesel. Before it even got the superstructure up on its building, it went belly up and left dozens of small contractors on the eastern shore of Nova Scotia owed literally millions of dollars.
I could not get any answers from the government on financial accountability. I figured that since it was funded with public money and since it did not seem to have a market, the public had a right to know how that project got funded.
I had to go to the unusual length of asking the Auditor General, since the ministers on the front benches refused to answer. For goodness sakes, the government should have a look at whether or not this project was properly approved and whether or not there is some financial management accountability in the system.
In his report the Auditor General said that the project in question, which may end up costing taxpayers in this country over $10 million and probably cause the bankruptcy of a whole number of small firms on the eastern shore of Nova Scotia, was approved outside the program criteria. The ACOA offices in Atlantic Canada did not do the proper evaluation of the project.
Where is the accountability, I will ask my friend opposite. Where is the accountability in a system like that? Mr. Speaker, if you are asking for examples, or if you want to put forward examples of technical account-
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ability or strengthening the laws, perhaps this bill addresses them.
The true question that has to be answered is why is this government not accountable for the way it spends the money of the people of Canada? An example would be the NSC Diesel fiasco for which the minister should have resigned and for which there should have been a full and complete police investigation. Perhaps we will have that yet.
There are a couple of points that need to be raised concerning this piece of legislation. I want to speak to some specific issues. I am going to start off at the back end of the bill and work my way forward. I want to talk about clause 40.
Clause 40 causes me great concern. We have a history in this country of equalization and of understanding that the country cannot be run as a business. It has to be run as a nation.
In order to run a country as vast and as great as Canada and have equity put in the system, it sometimes costs money. Sometimes, Mr. Speaker, you have to invest in infrastructure and admit that there is a cost for producing equity in this country, no matter where you live.
Mr. Speaker, if you live in Atlantic Canada you still have the right for quality health care. If you live in British Columbia, you should still have access to post-secondary educational institutions. We have entrenched in our Constitution the great liberal principle of equalization. It is there. It is what has made the country great.
Clause 40 tampers with the right of this Parliament to debate fundamental changes and directions in dealing with some Crown corporations.
I want to quote what it is going to do. Clause 40 effectively is going to do the following. It would effectively require commercial Crown corporations, those listed in Schedule III, Part II of the FAA, which operate in a competitive environment and not ordinarily dependent on appropriations for operating purposes, to incorporate dividend planning in its annual corporate plan.
In itself, that does not seem like a bad idea. If it is making money, it should put in its corporate plan that it expects to make money, and account for those revenues.
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The bill goes a little further and says that the Governor in Council would be empowered to set, waive or vary dividend payments for any schedule Crown corporation.
There is something fundamentally wrong here. What happens if, by Order in Council-which means a cabinet decision-it decides to have incredible user fees or a very high dividend from a Crown corporation like Ports Canada. This would decrease the effectiveness of Ports Canada to be a competitive alternative to ports on the U.S. seaboard.
Look at the port of Halifax.
The Port of Halifax is responsible for nearly $750 million worth of activity in the economy of Atlantic Canada and, more particularly, in the Halifax-Dart-mouth area. Ports Canada is fighting for its life against subsidized activity from the port of New York and from rail lines like the D and H, which Canadian Pacific recently acquired. It will be able to draw goods currently destined for the central Canadian market away from Canadian ports and draw them in through the U.S. and up through the Atlantic Seaboard with a line like D and H.
That Crown corporation is there for a reason. That Crown corporation is there because previous governments have decided that the ports of Canada were a national resource that should be operated by a national government. This government has changed all that. As I said a little earlier, the government does not understand. It thinks that everything has to turn a profit and, if it does not, it is bad and it has to be dismantled and thrown out.
We have seen what a few years of that kind of policy has done. This country has never, ever, faced the crossroads of confidence that it faces today, because this government does not understand national unity and it does not understand the important role of national infrastructuring in keeping the country together.
The Port of Halifax is facing incredible competition from the ports in New York and New Jersey. There is no question that when the inter-state trade commission of the United States was examining the application by the Canadian Pacific Railway to acquire the bankrupt D and H line, which will be able to take goods right from the Port of Halifax straight up to the Quebec border, a

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short-cut route for Canada-destined goods to get in through the United States, one of the largest shippers going into the Port of Halifax with containerized traffic indicated that it supported this application. It gave it an alternate and cheaper route for cargo going to the central part of Canada.
What does the Canadian government do? It forgets about the mandate of Canada Ports Corporation and, in the last budget, demanded that there be a dividend paid. This, at the very time that the people who are running the Port of Halifax have been doing everything but lying in the middle of the Macdonald Bridge and screaming to get the attention of the government that it is going to lose its competitive edge in trying to attract or keep container-based traffic going to the central part of Canada.
What does the government do? It forgets the mandate. It does not come to Parliament. It says in a budget that Ports Canada is going to have to pay a dividend. It forgets that it is there to do a job. It takes the money that Ports Canada needs to upgrade facilities, such as those at the Port of Halifax, and it says it has to be given to the government as a profit. The government takes the ability of the Port of Halifax and other ports to plan properly and, when they are efficient and make money, to have that money in reserve to reinvest.
I read here in Clause 40 of the bill that that may not be the case. The dividends that will be forced upon some of these Crown coqrorations can be made by a bunch of the guys and a few of the ladies who are on the opposite side, in the Cabinet, sitting down and deciding: "Well, I guess we blew it again. I guess the budgets that we had, the projections that we had for spending, went out the window again. We need an extra $100 million. Where are we going to go? I know. Ports Canada. Tell them they do not need $100 million this year. Tell them we need $200 million."
Before long, the debate that should take place in the House about the fundamental change in direction and philosophy of those Crown corporations will be muted and the government will be able, by that simple tool of Order in Council, that undemocratic tool, perhaps to dismantle even more of the national infrastructure and to do even more damage, not just to the economy of regions such as Atlantic Canada, but also to national unity. These are the underpinnings of national unity and anybody opposite who thinks they are not is crazy.
There are one or two other things I want to deal with. One of these, my colleague from Cape Breton Highlands-Canso dealt with and it is not a small issue. I hope that there are a whole lot of people out there watching, who have faith in their local fire departments. I hope that they are watching us as we speak.
I think it is Clause 6 which deals with user fees. Mr. Speaker, the government is absolutely crazed. It says: "Turn a profit, turn a profit, turn a profit." It does not matter what it shuts down, just turn a profit.
Let us not forget that it raised more personal income tax, I think 24 per cent or 27 per cent more, in the first half of this year than last year. By God, it is milking taxes out of us like we are a cow, an engorged cow. It just squeezes, squeezes, squeezes. It gets more and more cash. That is all it wants. It is so ashamed of what it has done on taxation that it has to find new ways to tax, and a tax is a tax is a tax. No matter how it takes it from someone's pocket, it is still taking it. But, it is dealing with something pretty dangerous here in user fees.
In 1986 the government changed the Telecommunications Act. The minister at the time was the former member for Kingston and the Islands, a former Cape Bretoner. I read the debates. There was a great debate, even in the Tory caucus, and the debate still goes on. It tells me that there are still a few people over there who are close to their constituents, not many, but a few. The minister at the time in the debate answered a question from the then member from South West Nova, who is now sitting in the other place as a senator. He was defeated by a Liberal, like most of those people were in Atlantic Canada at least. She said in response to a question from the former member from South West Nova that volunteer fire departments would be exempted. I do not have to embellish it. It is right there in the record. She said they would be exempted from those new licence fees.
What did the government do? It waited until it got another term in government and then it nailed the very organizations in communities, the people of which give of their time freely and risk their life and limb and security to ensure that the public safety and security is being looked after. I am talking about volunteer firemen,

for goodness sake. What did it do? This government, to milk a few more dollars, has gone after volunteer fire departments with unconscionable licence fees. Volunteer fire departments are not Liberal, Tories or NDPers. They are people in the communities and they feel very diminished. The minister opposite is nodding, and I hope he can tell his colleagues in cabinet that they should change this foolishness.
On user fees, the government would even hit volunteer fire departments. This means that in some cases there is over a 1000 per cent increase in the fee. A volunteer fire department, whether in Eastern Passage in my riding, or in any other ridings all over the country, has to raise its money. It gets a little bit of a fee from the municipality, but it has to hold bean suppers and fall fairs so that it can purchase equipment to protect the people in the community. What the government does is say work a little harder because it is going to charge a licence fee for every piece of communications equipment they have, not just one fee to cover the fire department, every single fee.
We started a petition drive. Every fire department in the country that I have been in touch with has indicated that these fees are not only regressive, but that they have been misled. In 1986, a very honourable member, the former member for Kingston and the Islands, said, as reported in Hansard, that the volunteer fire departments would be exempt. Again, because of user fees, the government thinks it can go in because there is nothing sacred. It does not matter if there is a fire department in some far-flung reach of this great nation that may have to forgo purchasing a new piece of equipment. Do not forget that they do not have bank accounts. They have to raise their money. Mostly, volunteer fire departments are in poor municipalities. These people are doing their part. For God's sake, the least the government can do with user fees is keep its hands out of their pockets.
I have talked to members opposite who have said the same thing. If there is one thing that the government could do to show that it has a little bit of compassion and understands how the country operates and the important contribution of volunteers like firemen and firewomen right across the country, is to say it made a mistake. It should live by the word and the commitment of the
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former Minister of Communications and withdraw those fees. That is what it should do.
Every fireman, fire department or individual watching this tonight should write to their member of Parliament and tell them that. More particularly, they should write to the ministers on the front benches. It is one of those small things when you talk about user fees. It is easy to say it will only cost a few bucks. But when looking at the potential damage to get that few extra bucks, it could be a little bit more financially responsible and ingenious on that side of the House. The few dollars the government will pick up on that may result in a slower response to an emergency in a community. It should withdraw the fee. That is why I have a little bit of a problem with the user fees.
I used to think that democracy worked in a certain way, that no matter if a government came in with a piece of legislation, if it saw that for whatever reason there was a flaw in it, it would change it. The government has developed a siege mentality when it comes to this type of initiative and it simply will not do it.
We on this side of the House are going to continue. I will be up every day, if I have to, presenting petitions from volunteer fire departments until the government comes to its senses and realizes there are certain things that cannot be touched and cannot be milked from the country because of its financial irresponsibility and mismanagement.
The last thing deals with transportation and infrastructure generally, user fees again. We have seen the government, with its quest for the bottom line, dismantle many pieces of the national infrastructure. Well, we do not all live in a Toronto, or Hamilton, or Vancouver, or even Halifax. Some of us have to live in other beautiful parts of the country where we do not perhaps have infrastructure that supports itself.
I talked a little bit earlier about the principle of equalization. It is enshrined in our Constitution-it is there. It means that the government, the people in the country, believe that we have to make level playing-fields, that there is a cost in keeping this nation together. It does not mean that we squander our money, but it

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means that we recognize that there is a cost and that we budget for it.
The government is now toying with full recovery fees, full implementation of cost recovery in the air transportation sector. Well, Mr. Speaker, do you know what that means? If we want to talk about destroying national unity, here is what it means. I am reading from a document from Air Nova in Atlantic Canada. I hope you will be a little patient because this is pretty important. It states that under full implementation of cost recovery, Halifax will be the most expensive of the nine major airports in the country. For example, a Dash-8 landing in Halifax will have to pay a fee of $121.60. The same Dash-8 landing in Vancouver, because it is a larger airport with more traffic, pays $37.60. A Boeing 747 landing in Halifax will cost $2,675.20. The same 747 landing in Toronto is $616.
This government has gone bonkers. It is going to try to implement full user fees, forgetting the fact that this is a regional economy, that we have many regions here, and it is going to try to take the levelling effect out of many of the user fees that we have in this country. It is going to pull another spike out of the track of national unity. Eventually, it will have Canadians so distraught at the way it has mismanaged us that, when it comes to the next great national unity debate, it will be hard to muster the forces in many parts of the country because of this government's financial mismanagement plan.
I could speak for days about what the government is doing, but suffice it to say that I will be on my feet again to complete my speech under another piece of legislation.


Charles A. Langlois: Mr. Speaker, I listened very carefully to what was said by the hon. member for Dartmouth. I had trouble accepting some of the points he raised, especially when he claimed that the Government of Canada should spend certain amounts of money and transfer amounts hither and thither. My impression is that he would want the government to do all this without considering its ability to pay or the taxpayers' ability to pay.
Mr. Speaker, I may remind the hon. member that Canada has a very substantial cumulative deficit which we must start paying off as soon as possible. If we don't, and if we don't succeed in putting into place various ways to control government spending and bring down the
deficit, the equalization principle mentioned by the hon. member will be a commitment this government will no longer be able to meet because it will not have the money to do so. There will not be enough money to do this, and Canadians of course will not have the ability to pay.
To get back to his comment on user fees, I think the hon. member would agree that a great deal can be done in this area. Obviously, the government must try to recover the costs of infrastructures, whether we are talking about marine facilities, airports or other areas where it is entirely normal that users should pay a certain amount of money.
We can question the amounts, we can question the tariffs and we can question the principle according to which the prices are set. However, I think the principle that users should contribute to the cost of infrastructures put in place by taxpayers is a universally recognized principle that should help, on the basis of revenue the government will raise, to absorb the costs of these infrastructures and maintain them in proper condition.
So I think the hon. member should have the honesty and common sense to admit that the principle of charging users certain amounts for the infrastructures made available to them by taxpayers is a fair principle and a sound one, and aside from the amounts to be charged and the tariffs to be set, I think the hon. member will agree that the principle of charging users certain amounts for public infrastructures should be acknowledged and maintained.


Ronald MacDonald: I certainly do realize that in some cases the government has to be efficient. Let us be fair. This government came into office and all was going to be wonderful in la-la land the day after it got in. It is finding out that that is not the easiest thing to do.


Peter Andrew Stewart Milliken: Six years later and it is worse.


Ronald MacDonald: Six years later is much worse, as my colleague for Kingston and the Islands said.
The member opposite wants to talk about fairness. I will give him a little lesson from his own books about fairness. We witnessed on Friday the government coming in, saying that first of all it needed more money and it
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was going to trim bucks from all over the place, but it was going to be fair.
I want to tell you how fair they are going to be, Mr. Speaker. They came into the Atlantic Canada Opportunities Agency, that quasi accountable agency that I referred to earlier, and do you know what the government did? It took about $650,000 from administration. Okay. Maybe it is going to have to do a little better with a little less money.
The government went over to the Western Diversification Fund which is the agency to deliver regional development in the west, like ACOA is the agency to deliver regional development to business and business assistance in the east. What did it do? It took $20 million in deferred grants and contributions from ACOA and did not take one penny in deferred grants and contributions from the Western Diversification Fund.
What the member opposite has to understand is that you cannot go about abusing the trust and misusing the resources that this country has and treat one part of your family differently than another part of your family. If the cuts are to be effected, then it should have effected it across the board. There should not be one member from Atlantic Canada on the Tory benches, not one member opposite who agrees that any part of the country, be it east or west, should suffer more under government cuts.
Do you know what they are saying opposite, Mr. Speaker? A great nationalist that I am, I believe everybody in this country should be treated equally. I guess I squeal a little bit when I see people from my part of the country who had the good sense to vote Liberal getting the boot from this government every time it comes in with its fiscal knife.


An hon. member:: Howard is laughing.


An hon. member:: Howard is laughing at us.


Ronald MacDonald: The member for Halifax West is laughing. But the member for Halifax West also laughed when I raised in the House the problems about the decreased competitiveness for the port of Halifax. He also laughed when we held up the strike-breaking legislation that his government brought in against the ships' crews and he also laughed when our party sup-
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ported the end of a wage inequity through regional rates of pay for dockyard workers. That member will be laughing on the other side of his face the next time the electors have a chance to deal with him.


An hon. member:: That's right.


Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, I listened to my colleague for Dartmouth with a great deal of interest. I think he has expressed quite well the plight in which this government has placed Atlantic Canada. It is absolutely devastating to our economy, this idea of complete cost recovery of all government expenditures.
I fully expect that this is not the end of it. I think we have an awful lot of user pay without it being designated as user pay. One example of this is in small craft harbours where this government is ignoring the plight of the fishermen in allowing the wharves which the fishermen need so desperately to fall into disrepair. Also, they are not doing any dredging in the small harbours.
That is not only a question of hurting the fishing industry, but it is also a question of allowing the silt to fill in the mouths of the harbours so that in rough weather fishermen cannot re-enter their harbours. They are in the position of being at risk of their lives out in the Atlantic Ocean.
Also, this government is actually diverting business away from the ports of Halifax and Saint John by refusing to put into place the repairs to infrastructure needed for Canadian National and actually encouraging Canadian cargo to be shipped into New York and transported by train from New York to Montreal and Toronto.
I would like to ask the hon. member, because he has spoken about this often, to comment on these and give us his interpretation as to whether these are as damaging to Atlantic Canada as I believe or whether I am being an alarmist in this regard.


Ronald MacDonald: Mr. Speaker, I want to thank my colleague from Cape Breton-The Sydneys, somebody who has stood up over and over again not just for the people of his riding but for all the people of Atlantic Canada and for a vision of this country where equality of opportunity exists no matter where you live.

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In response, I think this government has no sense of where it is going. It rules from the centre. It rules for the centre and rules to where the numbers are at. That means that if you can withdraw fiscal support to create a level playing field in places like Atlantic Canada, so be it. If it means that you can pit one part of Canada, east against west, you do it because all the Conservatives are concerned about is pleasing their buddies down on Bay Street and they do not know the first thing about national unity or the role that national infrastructure like railways, ports and small craft harbours play in keeping this great country together.


Peter Andrew Stewart Milliken: Mr. Speaker, I am delighted to have an opportunity to participate in this debate today because I noticed the President of the Treasury Board on his hind legs this morning telling us about the virtues of Bill C-91. I thought that it was appropriate to indicate some of the disasters.
I note that the bill is an act to amend the Financial Administration Act. Really, for this government to introduce a bill that has to do with good administration was an incredible sight. We had the minister standing there telling us how much more efficient this bill was going to make the government. Well, anything would be an improvement. There is no doubt about that. I have grave doubts though. When the minister talks about efficiency, he talks about nothing more than gouging and screwing tax dollars out of Canadians, which this government has shown itself to be so good at.


Dave Worthy: Be positive. Don't be so mean spirited.


Peter Andrew Stewart Milliken: The parliamentary secretary suggests that perhaps I am being mean spirited. I suggest that is not the case. The minister beamed and smiled his way through his presentation. He did very well, considering the material he had to work with. I suggest that what we have to do with this bill is have a good long look at it and look at the very bad administration that Canadians have been treated to under this government.
I want to turn to the supplementary estimates which the minister tabled the other day because I think they reveal something of the ability of this government to administer-


Mr. Sobeski:: Is this a point of privilege or debate?


Peter Andrew Stewart Milliken: If the hon. member listens for a moment, I think he will enjoy these comments. Page 32 of the supplementary estimates has some of the costs of the goods and services tax which this government is applying to Canadians. It is establishing a goods and services tax consumer information office. If you do a little arithmetic, Mr. Speaker, not complicated, a little arithmetic, you can see that they are hiring 20 new people, 20 person years are authorized. If you divide that into the amount of money for personnel that is shown in the estimates you get an average salary of $54,150 per annum for those individuals. That sounds a little high, but I will come back to that.
If we turn to page 84 the hon. member will see that in the Department of National Revenue, Customs and Excise, 1,163 lucky Canadians are going to be hired as tax police to enforce the new goods and services tax at an average salary according to these estimates of $41,490. You will notice that is down a little from the previous group that is working with the corporations.
Then if you look across the page you will see in the Taxation Division of National Revenue they are preparing and planning for pre-payment of the tax credits. In other words, this is the group that hands the money out to Canadians that we are all supposed to be so thankful for. The average salary of the 642 people being hired in that department is $33,124. Why would it be so much lower for the individuals who are going to pay out the revenue to Canadians, the great bonanza that they are getting back, than for the ones who are going to gouge and screw the tax out of Canadians? I know why. The government is more interested in getting the money than it is in paying it out. Why pay someone a lot of money to give money back to Canadians? Pay it to get it out of them. That is the priority of this government. That is what it means about better administration under the Financial Administration Act.
If that is not enough to convince the hon. member, he can turn to page 100 of the estimates. There we have the people who are actually going to send the cheques. "Preparation and planning for the prepayment of the GST credit to taxpayers", that is the people who actually write the cheques, I presume, in the Supply and Services Department, since that is where cheques are issued. The average salary there is the lowest yet. They are expecting to hire 45 people for this work at an average salary of
November 26, 1990

$31,471. In other words, who are the highest paid in this group? The ones who are advising the corporations, the ones who are in the Consumer and Corporate Affairs Department to advise the corporations, presumably, on how to make their tax payments most efficiently. They are being paid the most. Then we go to the Department of National Revenue where they actually go around and tax police and gouge Canadians for their money. They are going to be paid the second highest. The ones who make the refunds are the lowest paid on the totem pole.
I ask the hon. member to ask the minister for details on this. I am sure the minister would be more than happy to fill him in on how many senior bureaucrats are going to be hired at higher salaries in the upper end of the Consumer and Corporate Affairs Department. Take a look at the figures. I urge the hon. member to read the Supplementary Estimates. Perhaps he will find that he agrees with my analysis of this situation and will realize that when the President of the Treasury Board talks about better administration, what he is talking about is screwing more money out of Canadians.
I was happy to receive a press release recently from business leaders. This came from the Canadian Chamber of Commerce, the Canadian Manufacturers' Association and the Business Council. I know that the minister got a copy too. These business leaders all called on Ottawa and the provinces to curb spending. These people were simply appalled at this government's spending record, its out-of-control budget deficits, its inability to do anything effectively to control the deficit.
Some of these people may like the GST, but the bulk of the small businessmen who I know in Canada are dead set against this tax. The hon. member knows that too. If he were doing his job, he would be filing petitions from his constituents who are signing them by the hundred and who are, I have no doubt, opposing this tax. He should not sit there worrying about whether these people are opposed to the GST. They are opposed to the tax. Over 80 per cent of the population is opposed to this tax. I will give that fact to the hon. member. If he were listening to the 80 per cent of Canadians who are, he would be up voting against this tax, and sitting on this side of the House with his former colleagues who have
Government Orders
had the good sense to get out of the Progressive Conservative Party and sit on this side of the House.
I turn to the allegation of the minister this morning that this bill is supposed to be good for Canadians. He said that it would be good for Canada because it would make the government more efficient. I want to look at some of the evidence of the government's efficiency over the past few years. I have a calculation that I did from the Public Accounts of Canada. I thought that we might usefully see what kind of increases in taxes Canadians have had to face in the last few years.
Doing a year-on-year comparison of the increases in revenue, I was able to determine that from 1984-85, or in the 1985 financial year, there was a 10 per cent increase in revenue in the Government of Canada. 1985 was the first big Tory year. It was the first year after that disastrous election in 1984 that crippled the Canadian economy.
I can remember the Diefenbaker government. I remember and I am sure hon. members opposite will agree with me that it was probably the worst government Canada had ever had up until that time. Everyone acknowledges that the Diefenbaker government was a complete disaster for Canada.
The only one that I can imagine is worse is the present one. These figures bear that out. For 1984-1985 revenue increased 10 per cent, that is 1985 over 1984; the next year, an 8 per cent increase; the next year, 11 per cent; the next year, a 13 per cent increase; the next year, 6 per cent; and this year, 1990 over 1989, it is projected at 9 per cent.
That is the kind of revenue increases we have had under this government. We have indicated it has increased taxes over 31 times, and now think what it is going to be like under the GST. Think what it will be like under the GST. And here the minister is concerned about efficiency-


Patrick (Pat) Anthony Sobeski: You'll have no room on your credit card.


Peter Andrew Stewart Milliken: The hon. member says he has no room on the credit card. That is because the government has failed to live up to its responsibilities and its promises. That is the reason for it, and he knows it, and he should get this government out at the earliest opportunity.

Government Orders
Now we could turn to the percentage change in personal income tax and corporate tax revenue. Let us look at the personal income tax changes over this period, that is the amount of revenue the government derived from that source. In 1984-1985, that is the 1985 year over 1984, revenue from personal income taxes went up 8 per cent; the next year, 12 per cent; the next year, 14 per cent; the next year, 19 per cent-19 per cent in one year, Mr. Speaker. In 1989 over 1988 we have the big decrease. It only went up by 2 per cent.
Guess what? Maybe there was an election. Maybe it reduced taxes because there was an election. Is that possible? I would not have thought this government would be that politically motivated, yet it appears that is what might have happened. From 1989 to 1990, that is this year over last year, because of the tax increases and the recent budget, 12 per cent. Is that not an extraordinary story: 8, 12, 14, 19, election year 2, and the next year 12. That is what this government has been doing to Canadians. It has been fiddling around with the public accounts, the taxes, and so on, in order to make things easy for Canadians when it is time to re-elect it but dam difficult in all the years in between. That is what has been going on.
The corporate tax increases reflect a similar pattern but not the same. The first year, 1985 over 1984, there was a 28 per cent increase. It must have been a profitable year for the corporations. The next year it was 2 per cent; the next year, 7 per cent; the next year, 10 per cent; the next year, the election one, 7 per cent; the next one, 11 per cent. Modest increases by comparison. Compound them and I will bet you will find they are lower, and indeed all the figures suggest exactly that.
What this government means by saying that it wants to make financial administration of the government more efficient is that it wants to get more money out of Canadians for more things. You can look at the act. You will see that it applies interest on all kinds of obligations that citizens have to the government. It enables the government to use a collection agency so it will be more efficient in collecting money from Canadians and in collecting arrears of taxes. That is the purpose of this bill. Let us not kid around.
While we will say that some of the changes are quite laudable and probably worth while, the fact is this government is a real pro when it comes to squeezing
money out of Canadians and failing to deliver on the return side.
The other thing I thought was important and interesting as I perused this little bill the government has introduced was the fact that it left something out. We all know that this government has shown repeated, continuous contempt for this institution. It is showing it in the other place this very day, I have no doubt. I do not know what has happened down there this afternoon, but I am sure that the Conservative majority and its puppet, the Speaker, is busy doing what it can to deprive the opposition in that House of an opportunity to debate this bill. I suggest that what is going on there is another indication of the contempt this government shows for Parliament.
We saw it before because of course government members got into a mess when they called Parliament back after the 1989 election for two weeks and then decided that rather than face the music in this House they would help themselves to the public money by Governor General's special warrants. They abused these warrants in a way they had never been used before in Canada, by grabbing billions of dollars out of the public Treasury by warrant between sessions of Parliament, something that had never happened in this country before on anything like that scale and which I submit- and I submitted it at the time-was entirely improper, so much so that I felt I should-


Patrick (Pat) Anthony Sobeski: You lost the debate.


Peter Andrew Stewart Milliken: Yes, I did, because I was overruled by a large majority in this House. That is why I lost this debate; not because there was any element of fairness. The Speaker said that he would not rule on the issue.
When it was raised in committee, the Conservative majority in the committee silenced the issue very promptly. The hon. member for Halifax West was there. He ranted and raved. He said that I was being partisan in raising the issue. It was a completely improper use of the authority granted to cabinet and to the Governor General under the Financial Administration Act, this very Act that we are now seeking to amend.
Wonderful thing. Mr. Speaker, you look through this Act in vain for any change to the provision relating to the use of Governor General special warrants. I would have thought the government might want to put some restriction on its future misconduct in this field, because I
November 26, 1990

suspect we are about to see its misuse again before too long in spite of the grumbles from the hon. member for Halifax West.
I know this subject is a sore point with him. I believe he has some considerable experience in legal matters. I am sure he understands perfectly the arguments that I made in respect of those Governor General's warrants. I expect he agrees with every argument I made that in fact there was a flagrant abuse by the government of the use of those means of obtaining public money. It helped itself to the Treasury in a way that was completely unprecedented and wrong.
I introduced a private member's bill, Bill C-211, which sought to restrict the use of Governor General's special warrants. That bill is still sitting on the Order Paper. I am optimistic, as I am sure Your Honour is, that sooner or later it will be drawn in the famous draw that takes place every few weeks in Private Members' Business. Maybe we will get to discuss it in this House some day.
In the meantime, I would have thought that the government might have incorporated my amendment, or something like it, in Bill C-91. I went through the bill and I was dismayed to see not a word or mention of any change to section 30 of the Financial Administration Act, which might have corrected these bad habits on the part of the government.
It could easily have made it unlawful for it to do what I submit is improper and unlawful, that is, to abuse these warrants the way it has. Yet the amendment is not there.
I would invite the hon. member for Halifax West, who I know agrees with me in this regard, to raise this matter in caucus on Wednesday morning and see if he cannot get the minister to agree to an amendment to Bill C-91 so that we can fix this mess up now and not have a recurrence of the disastrous events of early 1989.
I can say that if the minister is worried about the amendment to the bill, I would be happy to have my bill read for the second time, by unanimous consent, and referred to the legislative committee with Bill C-91. The amendment could be incorporated into the bill. I do not want to claim pride of authorship. I am not worried about that. I just want the law fixed.
Government Orders
I know hon. members opposite would be more than happy to ensure that their government did not act improperly or wrongly again, because it must have been a very embarrassing day for the hon. member for Halifax West and others to have to vote with the government when the government had acted with such obvious [DOT]impropriety.
I submit what we have in this case is a bill that the government has introduced with one purpose in mind: To get more money from you, from me, and from the Canadian taxpayer. What it wants to be able to do-and the minister said it this morning-is collect money more efficiently. It wants to be able to manage the accounts of Canada more efficiently.
He made some reference to the fact that this would help the Auditor General and made a few other what I could only describe as pious utterances, to try to make the bill more palatable. It really is-and I think a quick glance through the provisions of the bill indicates that- an attempt to get more money out of Canadians in a faster, more direct, and perhaps more simple manner for the government.
I submit that while perhaps that is a laudable aim, it is not particularly a fair one for Canadians. We will want to examine the provisions of this bill on a clause by clause basis when the bill gets referred to the legislative committee.
I think the other part of the equation that I did not mention earlier is important. I talked about the increase in revenue, but I neglected to talk about the increase in expenditures. The businessmen who issued the communique I referred to a moment ago, the joint statement on the national economy from the Chamber of Commerce, among others, mentioned that spending was out of control. I have some figures to show just how much spending went up in the course of time.
The only reason I did not mention them was because the spending did not go up as fast as the revenue did. The revenue increases have been fairly astronomic, as the House has heard. Expenditures were a little more modest. I say a little more modest: 13 per cent the first year, 1 per cent the next, 4 per cent, 7 per cent, 5 per cent, and 7 per cent. So, you can hear, Mr. Speaker, that they are lower than the revenue.

Adjournment Debate
The revenue, of course, is the taxes we are all paying, but it did not cut-


Patrick (Pat) Anthony Sobeski: What was it for the election year?


Peter Andrew Stewart Milliken: No, no. It was 7 per cent the year before. The hon. member will be glad to know it was one of the highest.
I should also tell the hon. member that the national debt increased fairly significantly throughout this year. In fact we all know it doubled; 22 per cent in the first year, 16 per in the second, 12 per cent in the third, 10 per cent in the fourth, 9.9 per cent in the fifth, and 8.8 per cent in the sixth.


Patrick (Pat) Anthony Sobeski: It is getting smaller.


Peter Andrew Stewart Milliken: It is getting smaller, yes. As the hon. member says it is getting smaller. The increase is getting smaller because the debt is so much bigger. If the hon. member would study the figures sometime, he would find that what this government has done is allow the national debt to increase at a record pace in spite of all the phoney claims to the contrary. The idea that the operating budget is in surplus, what nonsense. You do not run an office and not pay the rent. This government is trying to claim it has a surplus because it is running the office and it is not paying the rent. It has to pay the rent. Canadians are having to pay the rent. This bill is one more indication of the government's desire to gouge and screw the Canadian taxpayer. We object to it.


Russell Gregoire MacLellan: Mr. Speaker, I was interested in my colleague's comments regarding the debt and the deficit. We do know how the debt has grown in the last six years. Not only has it grown, but the percentage of the debt that is being financed abroad has grown.
In 1984, when this government took office, the debt was around $170 billion and about 17 per cent of Treasury bonds were financed outside the country. Now the debt is $380 billion and 37 per cent of the debt is being financed outside the country.
It would be nice to have free trade with the Americans where we would be on an even footing. Of course interest rates are now 500 basis points higher than the Americans. Before the free trade agreement we could say: "If you are going to do business in Canada you have to manufacture in Canada". The free trade agreement did away with that, so it now seems that there is a haemorrhaging of businesses away from Canada into the
United States. There is really very little we can do because of the government's financial fiasco other than bring out new financial policies, which this government refuses to do.
Has the hon. member, as a member from southern Ontario, experienced this trend of businesses leaving Canada and going to the United States as a result of the disastrous financial policies of this government?


Peter Andrew Stewart Milliken: Mr. Speaker, I am happy to respond to my very learned and distinguished colleague from Cape Breton-The Sydneys.
I want to confirm that in fact there have been closures of businesses in my riding. I know of two that closed for the sole purpose of moving to the United States. There have been extensive lay-offs, particularly in the last few weeks as the recession for which the government claims credit-it claims it created it as a result of its policies- takes hold on the Canadian economy, throwing Canadians out of work.
On the other side of the coin, which my hon. friend mentioned, was the difficulty we face in borrowing abroad and the significant borrowings we have. Of course the higher the government deficit is, the more it drives Canadian investment out of Canada. Canadian companies cannot get capital on the markets at a reasonable rate, so they are forced to go and borrow abroad, which means we have more foreign investment in Canada and more Canadian industries being sold.
When this government said that Canada was open for business again, it really meant Canada is up for sale again. That is what it was talking about.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Ms. Lynn Hunter (Saanich-Gulf Islands):: 15, regarding a barge carrying three million gallons of bunker oil. At that time it was projected to travel through the Gulf Islands of my riding and into the waters of Saanich Inlet, on which a number of people are working hard to have become a federal marine reserve park. My question related to the regulatory vacuum that existed in respect of oil barges and tanker traffic in that area.
I want to take the opportunity now to expand on that because we have, since that question was asked and the government responded, received the report from the public review panel on tanker safety, marine spills and the response capability. This panel was appointed on June 9, 1989 by the Prime Minister. The report's short name is the Brander-Smith report. I would like to take the opportunity to highlight some of the report's findings, because they are quite critical and point out some of the regulatory vacuum which I highlighted in my question of last May.
One of the panel's major findings was that the capability to respond effectively to a spill of any significant magnitude did not presently exist anywhere in Canada. This shows the reality of the situation.
Another finding was that a much greater volume of oil enters the marine environment as a result of routine tanker operations such as loading, offloading, tank washings, and waste water discharges than as a result of accidents. Almost all of these operational skills can be avoided. Only 8 per cent of the oil tankers operating world-wide have double hulls or bottoms. Of Canada's 31 tankers, only one is double hulled and ice-reinforced.
Over all, foreign tankers pose a much greater threat to our shores than domestic tankers. Almost one-quarter of the foreign tankers inspected by the Canadian Coast Guard in the Atlantic region, over an 18-month period ending December 31, 1989, were found to be defective. There is a requirement, because Canada is a signatory to an international agreement, that Canada inspect one-quarter of the foreign tankers. Only 8 per cent of those foreign tankers are inspected, because there is not the capacity to inspect the others.
I read in The Toronto Star of November 24 about an incident which occurred just off our Atlantic coast. I think it shows the mindset of some of the members of
Adjournment Debate
the Department of Transport. We are talking about a major spill off the coast of Nova Scotia, and a Transport Canada spokesperson said that it was really out of our jurisdiction because the spill occurred in international waters and it was a foreign tanker, a Norwegian ship.
"It is really out of our jurisdiction" is almost like the "it is not my department" kind of response which I find and I think all members of this House find very irritating when we have to deal with any bureaucracy. It is our department, it is our jurisdiction, because we all live on one planet and it is in our interest that this issue is looked at. I know that the government is trying to use shrinking resources in order to do a job, but we have to reassess our priorities to make certain that people really understand what the danger is. When we are told that there is no capability to respond effectively in the case of any major spill, that is a pretty significant finding.
I would like to point out some other findings. There is also a glaring need to standardize and upgrade dockside chemical loading and offloading requirements, as well as the design, construction, and inspection of chemical tankers and barges.
I think this is the key recommendation or the key finding. In my riding, the Coast Guard receives a lot of criticism for its inability to respond. This finding is that the Coast Guard is seriously under-resourced and cannot provide for the level of monitoring, inspection and surveillance required to adequately protect our waters.
The people who work for the Coast Guard are probably doing their best but they are just not given adequate resources. I think it is up to the Minister of Transport to go to cabinet and say, "In order to do our job properly, we have to have these resources".
I will quote from the report. I think it is important that I get this right.
The Coast Guard's investigative and prosecution efforts are seriously inadequate and do little to deter polluters. Indeed, the chances of polluters being caught are small; of being caught and prosecuted even smaller. If polluters are prosecuted, the chances of being found guilty are minuscule and, if found guilty, fines are paltiy. In the few instances where prosecutions are attempted and prove successful, fines are unacceptably meagre: between 1979 and 1988, the average fine under the Canada Shipping Act was $4,700.
That is hardly a deterrent.

November 26, 1990
Adjournment Debate
Mr. Speaker, you are giving me the sign that I have only one minute left. There is a lot more I could say on this. What the government has to do is to start implementing these recommendations. The regulatory vacuum that exists is frightening for anybody who cares about the environment; anybody who lives on the coast line; anybody who has a business that depends on a pristine marine environment. That is a lot of people. We have to be able to integrate our economy and our environment. We have to start putting sufficient resources into protection of our environment so that the environment is protected.


Dave Worthy: Mr. Speaker, I would like to thank the hon. member for Saanich-Gulf Islands. I know she is extremely serious in her questioning, as she should be when it comes to the environment, especially to something that could permanently damage and irrevocably harm any part of our environment. She has to be especially serious because of the coast line in the area in which she lives. As she points out, it is the job of all parties to be questioning and critical. It is the government's job to respond, and I will try to do that now.
Sharing the hon. member's concern, as all of us do, our Prime Minister announced the Public Review Panel on Tanker Safety and Marine Spill Response Capability in June of 1989. This was the David Brander-Smith report. It was released November 2 of this year and it is far-reaching. The recommendations have been accepted by the department and will assist in the improvement of Canada's spill response capability.
Some of the initial actions now under way by the Coast Guard include the developing of barge regulations and the planning for the improvement and upgrading of equipment.
In addition, the Canadian Coast Guard has a number of contingency plans in place to attempt to deal with ship or barge source oil spills. The master plan is the National Marine Emergency Plan which covers all Canadian waters. On the west coast, this is supplemented by the Western Region Contingency Plan.
Furthermore, should a spill impact on boundary waters, the Canada-United States Joint Marine Pollution Contingency Plan would be invoked. This calls for the combined Canada-U.S. pollution countermeasure response. These contingency plans are exercised, of course, with our American colleagues on a regular basis.
In terms of resources, the Canadian Coast Guard has major pollution countermeasures equipment depots at Victoria, Vancouver and Prince Rupert. A recent one has been established in Sandspit and another is being established at Ucluelet.
There are also a number of private sector resources that can be called upon. In addition, of course, Canada can call on the U.S. Coast Guard in case of emergency.
The Canadian Coast Guard monitoring vessel monitors Canada's traffic movements on Canada's coast on a continuous basis and provides a reporting point for spills of oil or noxious substances. While my comments have been specific to the hon. member's region, needless to say all regions of Canada are being upgraded and similarly equipped.
Mr. Brander-Smith's study was in depth and far reaching in its implications. The panel's hard work is greatly appreciated and, as the hon. member indicated, it will go a long way to improving our marine response capability if we in fact can follow up on it.


HOUSING
Mr. Joe Fontana (London East):: Mr. Speaker, in answer to my previous question to the Minister of State for Housing as to whether or not we will have a co-operative housing program in 1991 and additional units built for people waiting for co-op housing, the minister was not as forthcoming as he could have been. In fact, he sounded rather unsure of himself and sounded rather unsure of his government's commitment to co-operative housing. I do not need to remind the minister that this government never made good on its initial commitment to 5,000 units per year. What it delivered is shamefully and irresponsibly much less than that: 13,000 instead of the 25,000 promised.
CMHC's evaluation of the current co-op program in the past five years indicates that the co-op housing has worked, is well received, and is meeting its social goals. By using its unique and innovative index linked mortgage
November 26, 1990

instrument, it can produce cost effective and affordable housing for this country.
However, mysteriously and suspiciously, CMHC has attempted to discredit some of the key areas of the co-op housing program by twisting statistical information. In its evaluation CMHC has made the conclusion that more targeting is needed and that security of tenure is not necessarily better served by the co-op housing than the private rental market. The evaluation also claims that the benefits of a mixed income cannot be proven.
Despite the fact that half of all co-op units is occupied by people in core need of housing, only 4.2 per cent of all households and co-ops perceived that it was very likely that they would be forced to move because of affordability problems, compared to the 11 per cent of private renters. Therefore it can be concluded that co-operative housing units do provide better security of tenure than regular rental units.
The minister said that the evaluation also revealed that a number of co-op tenants paying market rents can afford home ownership. Granted, there might be a few, but approximately 63 per cent of all co-op residents have annual incomes of less than $30,000 and approximately 80 per cent of co-op residents have incomes of less than $40,000 a year. The evaluation never tells us that in 12 cities across Canada a family with an annual income under $40,000 still will not be able to afford to buy a home. Given the incomes of its residents, these statistics suggests that co-ops are well targeted and are serving low and moderate income households.
By focusing solely on the income of the residents, CMHC evaluation limits the scope of its assessment. Affordability is just one housing issue addressed by co-ops. CMHC also indicates that 60 per cent of all co-ops have units targeted to accommodate single parents. Half of the projects accommodate the elderly and half also have units for the disabled. These targeted groups would have difficulty finding comparable housing accommodations regardless of their current incomes elsewhere.
Adjournment Debate
targeted to specific groups which have particular needs. Improving targeting to reduce the subsidies to moderate and high income earners in co-ops can be achieved but without jeopardizing the mixed income element of the program. The evaluation does not explore ways in which this can be achieved.
A report completed by Nick Van Dyk of the Canadian Housing and Renewal Association shows how the co-op program delivers affordable housing more effectively than other housing programs, including those that subsidize private developers. An evaluation of the co-op program's targeting must include a compiarison with other housing programs to determine which is more effective. The information contained in the evaluation report clearly leads to the conclusion that the index link financing of co-operatives has successfully made the programs economical. This is beneficial in dealing with Canada's housing problems. The ILM should be used to refinance all co-operatives constructed prior to the introduction of the ILM in order to make them more economical. These savings should be used toward the construction of the new co-ops.
It is clear that the Conservative government has not used the evaluation to examine new possibilities for co-op housing in this country. Instead this government has allowed only three weeks of so-called consultation with the Co-operative Housing Federation and other co-op resource groups to help with the new program. Meaningful consultation means working with the groups. It is little wonder that I and others questioned the sincerity of this government. Do they really want to quietly and secretly kill co-op housing in this country?
Given that the co-operative housing program has provided an economical and successful form of housing, and given that the demand for this different type of tenure is high, will the government again commit itself to the construction of 5,000 co-op units annually in order to meet the broad-based need for this housing program? Will this government and this minister announce tonight, commit, to renewed and a rejuvenated co-op housing program for 1991 and beyond? Or will affordable housing for needy Canadians be also sacrificed for a military effort in the Persian Gulf?
The concept of mixed income co-op projects has great I ask once again that this minister let these co-op social value. Eliminating the possibility of constructing people in the waiting lines and the co-op resource low income ghettos, it also allows for co-ops to be groups know exactly what the government's plans are for

November 26, 1990
Adjournment Debate
the next five years for a worthy program that has succeeded in the past 25 years in this country.


Hon. Alan Redway (Minister of State (Housing)):: Mr. Speaker, I want to make it quite clear to the hon. member that I am a very strong supporter of co-op housing and a very strong supporter of a continuing co-op housing program.
I know that the hon. member is aware that the federal government has been involved in a co-op housing program of one sort or another since the 1970s. In fact there have been three separate co-operative housing programs dating back to the 1970s. Each one has had different criteria, different aspects to it but all of those programs together have produced some 45,000 or more units of co-operative housing over the length of time there has been federal co-operative housing programs. Since 1985 when the current co-operative housing program was put into effect, over 13,000 units of co-op housing have been included and added to that total.
Back in 1985 the federal government, as you know, Mr. Speaker, and as the hon. member knows, conducted some consultations with respect to its housing policies in order to determine where we should go from that point. At that time there were consultations broadly held with the entire housing industry, all groups involved, including the co-op housing movement and everyone associated with it. Out of that came a consensus that the government would try from that point forward to target all of its housing dollars to those people in our country who were most in need of housing.
The hon. member is well aware that there are an awful lot of people in that category who are not being served today. In fact, about 1.2 million households in this country fall into that category.
The difficulty, as the hon. member is aware, is the fact that the co-operative housing program fact is not entirely targeted to low-income people. It is in fact, by definition, and by philosophy a program which is a mixture of incomes and therefore, as a result of that, is an exception to the government's housing policy targeting all housing funds to low-income people.
This housing program that was put into effect, being an ILM, an index-linked mortgage program, for five years was carried out in consultation with the co-op housing movement. It was to achieve some 5,000 units of co-op housing a year, but in fact failed to do that, not because there was any intention on the government to
not produce that amount of money, but because there was an agreement made to put $5 million a year into producing units of co-op housing. We were unable to achieve that target because of the differing real interest rates on ILM mortgages and because the subsidy per unit cost rose from $1,000 to over $3,000 per unit at the current time. We have been endeavouring through our consultation process and our evaluation process to come up with a new program and some new recommendations in good faith. I will be making those recommendations to cabinet before the end of the year. I can assure the hon. member that I am certain he will be pleased with the results of those recommendations.


Rey D. Pagtakhan: Mr. Speaker, the issue that I continue to raise with the Minister of National Health and Welfare concerns ethics in biomedical research. When may clinical testing of drugs be done on humans and how should subjects be enrolled in the clinical study? Does it matter whether the sponsor of drug testing is a medical school, a hospital, a doctor's clinic or a medical establishment?
On November 5, Canadians saw on national television a revelation that Canadian subjects had been enrolled in a clinical trial of the drug HI-6, an antidote against nerve gas poison, sponsored by the Department of National Defence, without them being fully informed that the drug could cause cancer, apparently despite contraiy advice from the ministry of health.
Hence, my first question to the minister on November 6 was: "Could he explain why this study went ahead despite non-compliance with our Canadian ethical standards? Was he surprised and would he halt the study unless it reveals all known side effects to volunteers and thereby ensure informed consent?"
The minister in essence replied that in subsequent trials, that is during phase two, he will insist that a specific reference be made as to the possibility of carcinogenicity notwithstanding the fact that no direct evidence suggests the drug can cause cancer.
On November 7, I again posed a question to the minister. I challenged him to admit that the necessary tests for cancer in animals have not yet been done. I called to his attention that the drug is prohibited from
November 26, 1990

being manufactured in the United States because of danger to the employees and the community.
Earlier, during Question Period at that time, the Minister of National Defence had admitted that one ingredient used in the manufacturing of the drug is bis-chloromethyl ether, which is a known carcinogen, that is, it has cancer-causing properties.
The minister for health, in his reply, indicated that tests done in other jurisdictions showed the drug is safe. If one did not specifically test for cancer-causing properties of the drug and one did not have so-called purity data, that is the extent of chemical reactions during manufacturing, one takes the risk the carcinogenic ingredient could transmit its danger.
In fact, allowing such a practice would set a bad precedent for testing of new drugs for cancer in animals before trials in humans. To say that HI-6 could possibly cause cancer without animal data is meaningless and unethical.
On November 8, one of the subjects for the clinical trials was quoted in the press as having agreed to participate mainly because he was "broke" and he stayed in the study because he needed the money.
I therefore asked the minister whether enticing Canadians who are poor with extra dollars to serve as subjects is ethical. Examination of the consent form reveals some inconsistencies with respect to this matter. Page 3 of the form states: "Discontinuation from the study will involve no penalty", yet, page 4 states: "the subject will only receive percentage of the full fee-" unless the subject completes, "all aspects of the study."
Page 2 of the consent form alluded to one clinical study in Yugoslavia to sustain the claim that there were no untoward effects to date yet page 3 of the form alluded to "previous clinical studies", thereby suggesting more than one. My question is, why the discrepancy in numbers?
The form also indicates that the drug "may damage sperm cells which could result in birth defects." While advice was given to subjects "to practice contraception
Adjournment Debate
during the study and for 90 days following the study," no clear information was available as to possible damage that may occur as a consequence of cumulative doses as this particular study would allow.
I further challenged the minister why the clinical testing on humans should proceed before testing for cancer is done on animals. Indeed, Mr. Speaker, I thought the government had the sequence backwards.
The issue before us is indeed most important. I would like to conclude by reading into the record of this debate a brief letter to the editor of The Globe and Mail, the issue of last November 11, from Dr. David Roy, Director of the Centre for Bioethics and Clinical Research at the Institute of Montreal. He writes:
Respect for human beings and the protection of their health and lives, dignity and rights have formed the core of the many codes and guidelines governing the ethics of research with human subjects since the Second World War. The Nuremberg code marks a turning point. It crystallized the essential characteristics of consent required to protect the autonomy of human beings in biomedical research.
Consent is not voluntary if people are seduced by money to submit themselves to potentially dangerous tests of new drugs. Consent to such tests is not adequately informed if those seduced to participate are not told about the effects previous tests of a new drug have had on animal and human bodies. Consent cannot be adequately informed if previous testing was insufficient to deliver reliable information about possible toxicity. Consent cannot be comprehending if warnings are couched in terms so vague they blind participants to the possible dangers of testing.
He continued:
It makes no difference whether the sponsor of drug testing is the medical establishment, a drug company, or the military-the ethics of research with human beings remains the same.
He concluded his letter:
We must not now, or ever, abandon the ethical progress we have made with and since Nuremberg.
I submit, Mr. Speaker, the HI-6 drug testing in question has failed to fully comply with the established ethical guidelines that now govern the conduct of biomedical research in human volunteers. Therefore, this particular study must be halted until the required animal studies for the concerns that I have raised have been done.
I trust and hope that this government will respond accordingly.

Adjournment Debate


Mrs. Lise Bourgault (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, I want to thank the hon. member for raising this question during the adjournment debate and for giving me this opportunity to repeat the guidelines for testing new products.
I am sure you will understand, and I assume the hon. member is aware, that the Department of National Health and Welfare takes this very seriously. It does not take lightly the risks to human beings who test new products.
Obviously, Health and Welfare Canada considers the risks and must weigh the pros and cons, before it finally authorizes human testing.
In the case of HI-6, Health and Welfare analysed these aspects, and at the time it was concluded most emphatically, on the basis of the evidence, that its benefits as an antidote for organic phosphate gases outweighed the potential risk.
There have been allegations that it would be harder for a company than a department to reach that conclusion. Not so. In this particular case, the Department of National Defence had to conform to the same guidelines
and then some, before Health and Welfare Canada would allow this product to be tested.
Of course there is also the matter of compliance with the Food and Drugs Act and Regulations. Mr. Speaker, it has also been alleged that the regulations themselves are not strong enough. That is not the case. In fact, we are told the exact opposite is true. Often companies launch new products they are sure will be good for various diseases, including AIDS in one case. We heard a lot about this in connection with a drug for AIDS.
Mr. Speaker, I may add that the Department of National Health and Welfare has the authority under the Act. It is all very regulated.
There is also the ethical aspect, and I agree with the hon. member that it must be very strictly observed. Canada signed the Helsinki Convention. This aspect is very strictly enforced, Mr. Speaker, and I am sure that with the help of the hon. member, we will continue to ensure that our standards are the very highest and protect the health of Canadians who test these products.


The Acting Speaker (Mr. DeBlois):: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 11 a.m., pursuant to Standing Order 24(1).


[Stage Direction]
The House adjourned at 7.30 p.m.
[Stage Direction]
Tuesday, November 27,1990