1991-10-07

[Stage Direction]
The House resumed from Thursday, September 26, consideration of the motion of Mr. Harvard (p. 2805)
Mr. George Proud (Hillsborough):: Mr. Speaker, I rise today to speak to the motion put forth by my hon. colleague from Winnipeg-St. James, a motion that would allow seniors to pay their income tax in one annual instalment if they wished to do so.
Many senior citizens no longer hold salaried jobs and are on pensions. These people are now required by law to estimate their annual income and determine from that estimate how much to pay Revenue Canada every three months. This has created some very serious problems for Canada's retired people. These citizens have always paid their income tax on or before April 30, a deadline given all Canadians, but once this part of our society reaches 65 years of age they are required by Revenue Canada to estimate and pay their taxes every three months.
It seems to me that under the current system the government is saying to most of our esteemed citizens: "We do not trust you to fulfil your obligations as taxpayers. Therefore we will make sure you will fulfil your obligations by requiring you to submit to a more rigid system of tax collection than we impose on other Canadians".
The government might claim that estimating income should not be a difficult task for seniors. After all, they
are usually on an fixed income but this government has failed to realize that there are plenty of seniors who do not have straightforward incomes. Investments, bonds, stocks, these things change constantly. Even with a part-time job they can have enormous differences in their taxes. To add to this, if seniors make a mistake and pays less than what is expected, they are heavily penalized. There is no statement showing the error or no phone call explaining what went wrong; just a bill with interest added immediately.
At a time when we should be taking care of our retired, our aged, this government is playing credit department and forcing people, some of whom are on varying incomes, to pay up every three months, correct or incorrect. It insults the very people who make Canada what it is today.
In their golden years this government is telling the builders of this country: "You be sure to pay your taxes every month in case you forget or in case you make a few more pennies than you earlier thought while the rest of self-employed Canada enjoys the courtesy of paying once a year and the option of payment instalments".
It makes so much sense for this government to allow seniors to pay an annual expense if they choose to do so. Simply stated, it is a choice they are asking for. The seniors are not asking to pay less taxes, although they could. They are not asking to pay taxes monthly. They are just asking to be able to choose to pay taxes once a year. That is all, an option to pay taxes once a year.
It would make a great deal of sense in my view for the government to support this motion. It would remove from thousands of senior citizens the feeling that they are being treated differently and punitively by the government of this country.
The seniors of whom my colleague speaks and who have written and spoken to every one of us here do not seek to pay less than their fair share of taxes. What they seek and what we seek on their behalf is a system which

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will remove from them the strain, both financial and emotional, of having to submit taxes every three months to the government.
Let us remove from them the worry that a slight miscalculation or a slight unexpected increase in earnings will lead to confusion and penalties down the road. The removal of this irritation and fear would only be one small way in which we could show these people our gratitude for their contribution to this country.
As I said earlier, we are not advocating that they do not pay their taxes. We are advocating that they pay their share more fairly.
Let us talk about options. The senior citizens of this country have been denied a choice, a choice that we as taxpayers are entitled to. Simply stated, these people unlike salaried persons must pay their income tax in four quarterly payments, payments which for the rest of us are simply taken off our paycheques.
Seniors do not have this choice. They must adhere to the government's strict policies and tax payments, laws that force a person who misses a payment or is late to pay swollen interest along with the error in calculation. These people have worked their whole lifetime and deserve the benefit of the doubt and respect of the government.
Why can this government not avoid the obvious drawbacks of this system and legislate a simpler, more effective and more democratic system? The majority of seniors has been paying income tax for years, so how can this government assume this childlike approach to those parents of our present government, to those people who have paid?
I was most interested to note the comments made by the hon. member for Edmonton Northwest when this matter was discussed earlier. He agreed that the present method could be improved upon. He went on to suggest that in his position as chairman of the finance committee he would look at alternatives, one of which could involve putting a higher limit on the tax so that less people would be involved in having to file quarterly reports.
He mentioned at that time that the taxable income of $10,000 per year might be more reasonable as the cutoff amount for quarterly instalments. I am encouraged to see a member of the government side of the House agreeing with the intent of the motion suggested on this side, even if he did not support the motion in its present form.
What I would like to suggest is that the members on the other side do not postpone action any further by referring this matter to the finance committee, but rather show their goodwill toward the senior citizens of this country by supporting the motion put forth by the hon. member for Winnipeg-St. James.
Let us join in this House in showing the senior citizens of Canada that we appreciate the efforts that they put forward in building this great country. Let us not penalize them by subjecting them to a more restrictive tax system that we impose on others who are better equipped financially to deal with it.
I urge members on the other side to support those of us who respect the needs of seniors and vote for this motion. I ask this because I know that those across the way would like to support this motion.
I ask them now to give it their wholehearted support. [Translation]


Mr. Pierre H. Vincent (Parliamentary Secretary to Deputy Prime Minister and Minister of Finance):: Mr. Speaker, I welcome this opportunity to speak to motion M-484, tabled by the hon. member for Winnipeg St. James.
Mr. Speaker, the purpose of this motion is to allow senior citizens with no income other than that taxed at source to pay income tax once a year instead of paying in four quarterly, provisional instalments, and the hon. member for Winnipeg St. James is to be commended for his interest in the concerns of senior citizens. Mr. Speaker, as you know, I share that interest, as does this government.
One example of what this government has done so far to help senior citizens in fiscal matters is the 1988 tax reform. You will remember, Mr. Speaker, that before 1988, when filing an income tax return, every Canadian taxpayer had a personal exemption. Senior citizens had an additional exemption because of their age. In 1988, the age exemption was $2,670, and as I have said repeatedly in the House, this exemption was replaced by a tax credit, thus making the Income Tkx Act and our tax system fairer and more equitable.
I don't want to get into any details this morning, but I would like to point out that as a result of this change, in 1991 the same exemption is now $3,235. Clearly, Mr. Speaker, this government made sure that senior citizens would benefit as a result of turning the exemption into a tax credit. The personal exemption, which all senior citizens have, just like you and me, was $4,270. This basic
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exemption, which was also changed to a credit, would this year be equal to a credit or exemption of $6,000. So we have $2,000 more for the basic exemption and nearly $1,000 more for the senior citizens' exemption, if we consider the difference between 1988 and 1991. Across this country, 290,000 senior citizens no longer have to pay federal income tax as a result of changes in our tax system. Mr. Speaker, I think it is important to emphasize the fact that we have 290,000 people in Canada who no longer pay income tax, and if they no longer pay income tax, they certainly do not have to pay quarterly instalments.
Now, what is the purpose of quarterly instalments? To understand the concept, first we have to know what the Income Tax Act says. The Income Ikx Act provides that any taxpayer with income on which tax is not deducted at source and who at the end of the year has to pay at least $1,000 in income tax, must pay his income tax in quarterly instalments. Mr. Speaker, I admit I have discussed this often with senior citizens in the riding of Trois-Rivieres-as you know, it is the most beautiful riding- My colleague next door doesn't quite agree, but it is true just the same, Mr. Speaker. So as I was saying, many senior citizens are delighted with this system because on March 15, when they have to send their first quarterly instalment for the year, they know, give or take a few dollars, how much federal income tax they will have to pay the rest of the year. So on March 15 they make out the first cheque, which is one-quarter of the total amount. This means they can easily budget for the next instalments.
Mr. Speaker, assuming that we accept the principle of quarterly instalments, for senior citizens it means they can spread the amounts they have to pay over a certain period. It means they will not have an unpleasant surprise at the end of the year, in the form of a large amount of income tax to pay for which they might not have budgeted.
Payments are based on the previous year's income, although not 100 per cent, and that is very important. If a taxpayer can prove that his income for 1991 will be $10,000, $15,000 or $20,000 less than it was in 1990, he doesn't have to pay his instalments on the basis of his
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1990 income. He pays on the basis of his projected income for 1991.
If he accidentally forgets to send his cheque on March 15 or on the fifteenth of the following months, he does not have to pay interest if the amount of interest payable on the tax instalment he failed to send is $25 or less.
My point is that there is some flexibility in the system. More importantly, Mr. Speaker, senior citizens have a chance to budget for their tax payments.
Finally, Mr. Speaker, the system has worked well so far, and I think it should be left in place. Mr. Speaker, if there is any reason to change the system, we will consider what should be done.


Ms. Margaret Mitchell (Vancouver East):: Mr. Speaker, I am pleased to rise in support of the motion of the hon. member for Winnipeg-St. James. I think his motion really reflects the desires of many senior citizens and retired persons who have a taxable income and owe over $1,000 in income tax.
I will read the motion into the record again. The motions states:
That, in the opinion of this House, the government should consider the advisability of changing the collection of income tax as it affects citizens whose income is not taxed at source so that senior citizens who are required to pay income tax in four quarterly instalments will be permitted to pay only one annual instalment.
One of the reasons I support this motion is not only for its good, practical sense, but it also reflects the concerns of quite a number of my older constituents who have come to my office. They are very upset and confused about this particular regulation, and I might say very, very annoyed with the government.
A number of my constituents did not realize they had to pay quarterly, or were confused about it. They felt the tone of accusation in letters they received from the government were in effect an intimidation, implying they were dishonest when really it is a matter of being a very confusing and inconvenient way of paying taxes.
Others found it difficult to predict what their annual income might be. One of my hon. colleagues said earlier that this could vary so it is difficult to calculate one-quarter of what the annual taxable income would be.

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They felt the high interest rate was not really a very fair or considerate way of treating older people if they did not pay, when often it was just a mistake, an error on their part and a lack of knowledge or lack of memory, perhaps.
Senior citizens are upset with the government and I think this is only one of many serious issues they are upset about. I certainly think it would make sense to give older people choices as to whether they pay in annual or quarterly instalments. I suspect most would choose the option to pay annual instalments as they did in the past if that were the case. I would like to say that this is the kind of frustration, anger and in some cases the hurt feelings that people expressed to me when they came to my office. It really reflected a very general disillusionment and anger at this government.
It did not take much conversation to get into some of the other things that have happened to seniors which we are not forgetting and they are not forgetting. There was the famous clawback of old age pensions. People who are really just in the middle income group now will have to pay income tax on some of their earnings, including the old age pension.
It is perhaps not so much the amount of tax but the impudence and the arrogance of this government in doing away with the whole tradition, a Canadian institution, part of our Canadian value system of universal old age pensions. That is what they are angry about and what we should certainly continue to challenge. I believe it was a very bad move on the part of this government.
Another thing is the impact of the GST on the incomes of people who have fixed incomes. This is difficult on all people but is particularly difficult on families with children and the expenses they are paying the GST on every day. For older people who have a fixed income and who do not have a 7 per cent increase in their income every year, it is particularly difficult. They are certainly feeling the pinch. I am sure that many people are having to take this extra GST expense out of their food budgets.
The third thing I would like to mention that is very worrisome to seniors across the country is the real threat to medicare and the threat of user fees that may be pending in some provinces. They are getting pretty close to charging user fees for certain services now. This is a threat to the universal nature of our medicare system
which seniors, in their younger years, fought hard to establish during difficult times. The one thing, regardless of political partisanship, that binds Canadians together is their support for universal medicare, as well as for universal old age pensions and other social programs.
I do not want to take a long time to debate this, but I certainly want to express the views of our party. We object to the assault that is being made on pensioners and senior citizens. We support the suggestion of this member, which would not cost the government any money incidentally, to revert to an optional arrangement where seniors may pay income tax on an annual basis if they wish. We certainly intend to continue monitoring the other programs that are attacking seniors who have built our country and who deserve much better treatment.


Mr. Garth Thrner (Halton-Peel):: Mr. Speaker, I appreciate the opportunity of speaking to the private member's bill brought forward by the member for Winnipeg-St. James. My hon. colleague proposes to change the requirement for senior citizens to pay income tax in quarterly instalments and instead have them make just one annual instalment.
I believe there are probably some potential benefits in this particular move. Likewise there are probably some potential dangers. I would like to touch on both of those aspects.
First I would like to thank my colleague for raising the important issue of taxing Canadian seniors. We all share the hon. member's concern for the senior citizens of Canada. Of course seniors built Canada. Seniors were a paramount concern, I do believe, to this government when we introduced fundamental changes to the personal income tax system which took effect about three years ago.
With the introduction of the goods and services tax and major changes in tax assistance for retirement savings under pension reform, I believe the fair tax treatment of seniors continues to be of concern to this government. I will say more in a minute or two about some of the specifics.
Notwithstanding some of the arguments that I may be making in the next couple of minutes, I would like to say that I do see some merit in what the hon. member is proposing. I am not about to discount or discard the
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particular suggestion of the hon. member because I think, more importantly, a change such as this that affects so many Canadians really needs more study, more debate around the whole question and more examination to know whether it is going to achieve the kind of fairness that on the surface it purports.
I would like to report to the House that about one month ago I was in Vancouver with the Minister of Finance. We were attending a conference which we had opened up to the public and we invited public debate and questions on all issues before the Minister of Finance. One senior citizen did come to the microphone and raised this exact point. He asked the Minister of Finance why it was necessary for seniors to file income tax returns on a quarterly basis.
I would like to report to the House that the response of the Minister of Finance was quick and decisive. He agreed with this particular senior that this is an area which needs examination and that, in his opinion, the Government of Canada should re-visit the whole question of the frequency of income tax payments. I gathered from him at that particular time, although I did not see any media picking it up in response, that this was an issue of concern to the Minister of Finance.
Therefore, having heard the minister say that himself, I am not going to stand here and say that my colleague's suggestion in this House is without merit because I think it does have some points to it that are worthy of consideration. It is not a matter of if we should make these kinds of changes, but how and when and how most appropriately so that we really facilitate seniors themselves.
I have heard members of the House of Commons finance committee indicate in the House a willingness to consider this particular proposal seriously before the standing committee. I support that. I think it would be a progressive move.
The experience of my own parents who make these quarterly payments shows that it is something that is an added concern financially and that a lot of people do not need that added concern at that particular age.
I would ask and urge my colleague from the other side who has proposed this particular measure to withdraw it and instead to write to the chairman of the House of Commons Standing Committee on Finance and ask that the issue be brought forward to the committee. I suspect,
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not having spoken to the chairman directly, that the committee would be quite pre-disposed to deal with this particular motion and I think that is where it should really go for further action.
Those are my own comments and added to those I have a few stock responses that I would like to make in terms of some of what this government has done to try and be as fair as possible to senior citizens, given our economic and fiscal constraints.
Let us review a few of the facts. Under personal income reform, this government introduced a number of changes that were designed to be of particular benefit to seniors. For example, the $2,670 age exemption that would have been in effect in 1988 has been replaced by the age tax credit. It has provided tax assistance equal to an exemption not of $2,670 but of $3,235 for those in the 17 per cent tax bracket. In addition, the $4,270 basic personal exemption has been replaced by a personal tax credit. It has provided tax assistance equal not to $4,270 but equal to $6,000 for those in this 17 per cent tax bracket.
In 1991, the age credit is $575 while the basic personal credit is $1,067. Together these measures will provide tax assistance equal to an exemption of almost $10,000 for 80 per cent of the seniors in the 17 per cent tax bracket.
While I accept some of the arguments made by the speaker who preceded me in terms of a perceived assault from time to time on some of our social structures, our social safety nets, the fact is that the basic exemption for 80 per cent of the seniors in this tax bracket is far higher than it was just a few years ago.
This is probably the most significant point: as a result of the changes made by this government, almost 300,000 more seniors do not pay tax. That is quite a change in three years. Since 1988 to 1991, and let me stress this again, almost 300,000 more senior Canadian citizens do not pay federal income tax.
Then we have the much maligned GST. With the introduction of the GST the government also brought in a GST credit. It was designed to ensure that families, lower income Canadians including seniors, those people in our society who earn less than $30,000 a year, will get some net benefit from this change in the tax system. After they have paid the GST on the purchases which apply and they have received this credit back at the end

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of the day, the assurance has been there from the government, although we do not have a full year of experience yet, that these people will actually have paid net less sales tax.
In 1991 the GST credit will provide a benefit of $190 per adult and $100 per child. I think the member for Hamilton West will find this particularly interesting because he has been a keen student of the GST credit. I think the member would agree with me that any change we can make in terms of refunding sales tax to those people who make under $30,000 with a limited ability to pay would make them better off.
I would just like to point out that the GST credit provides a benefit of this $190 per adult and $100 per child, and it is reduced by 5 per cent of net income in excess of $24,000.
Besides that, there are other benefits the government has made sure that our seniors enjoy. For example, a substantial portion of the government's resources have been committed to providing income support for the elderly. We have old age security programs and guaranteed income supplements providing seniors with a basic level of income support. In 1991 every Canadian over the age of 65 will be eligible to receive about $4,300 in old age security benefits. Every little bit helps. It may not be as much as it could be but, given Canada's current fiscal and economic position, it is very important that we do everything we can.
My time is just about up so I really do not have time to run over a number of the other benefits that I think this government has given seniors. Let me finish with this point: I think my hon. colleague who has made this suggestion makes it in good faith. I do not think he has done it in order to try and embarrass the government or to challenge our particular policies and practices. I think he has done it in the spirit of fairness and in recognition of the contribution made to our country by seniors.
Having made my points, I would suggest again that the member withdraw the motion and ask the chairman of the Standing Committee on Finance to bring this before the committee for an exhaustive study. I think there are merits here and I do not want to see it simply voted down because we happen to split on party lines. I would like to
see this issue advance and I would suggest once again to the member that he bring it before the committee for further study.


Mr. Stan Keyes (Hamilton West):: Mr. Speaker, I will state again that I consider it a privilege to rise in debate today in support of the motion in the name of my colleague and my benchmate, the hon. member for Winnipeg-St. James.
Having just heard from the hon. member for Halton- Peel, he performs quite a bootleg on the main motion. He talks about how many fewer senior citizens pay income tax and how terrific the GST is now for the senior citizens of this country. The hon. member for bootleg, Ontario, should be reminded that we want to get specific about the motion, the motion being:
That, in the opinion of this House, the government should consider the advisability of changing the collection of income tax as it affects citizens whose income is not taxed at source so that senior citizens who are required to pay income tax in four quarterly instalments will be permitted to pay only one annual instalment.
That is the motion. It is very clear, very succinct. I would trust that many members opposite support this motion, even though the member for Halton-Peel has some reservations about it and he is not prepared to vote for it here in the House of Commons. Either you believe in the motion or you do not believe in the motion.
The motion is an important one as it would redress what many on both sides of this Chamber see as an imbalance between the way senior citizens pay income tax and the way the rest of everyday Canadians pay income tax in this country.
Senior citizens who no longer hold salary positions and are on pensions are required to pay income tax on a quarterly basis. Revenue Canada demands these senior citizens pay on a quarterly basis and if payments are not made on time seniors are charged interest.
Imagine that once a senior retires from a regular job and no longer has income tax taken off at the source, the pay cheque, he or she is certainly not eligible to pay income tax in the same way everyone else does. Instead of receiving one income tax form and sending it in showing either that the person owes money or is about to
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get a rebate from the government, seniors have to go through this entire process every three months.
The irony is that if the government owes a rebate to a senior, the senior may have to wait a long while before receiving a cheque in the mail. On the other hand if a senior owes money to the government and is not immediately able to send in the money to the government, perhaps because the senior no longer holds a regular paying job, the government insists on having the senior pay interest on that amount.
There is also another injustice levelled at seniors. If the government does owe money to seniors and by mistake makes an over-payment to them, it will demand that extra money be returned to it without delay and will charge interest on that sum if they are late paying the amount.
For the seniors who rightly believe that the rebate is correct and that they are owed the money and who subsequently go out and make use of that money for any of a number of purposes, how are they supposed to pay it back if they are on a fixed pension income and the government is knocking at the door, the tax man is at the door, demanding that money back? Most often they cannot.
It is a burden for many seniors. For those of us fortunate enough to be receiving a regular pay cheque, tax is taken off at the source. We may owe money at income tax time but we have only to fill out the form annually and be done with it.
This motion would redress one of those imbalances and would give back to seniors the choice of making their income tax payments once a year, not every three months. The government says that its reason for having seniors pay quarterly instalments is that if they did not, and because seniors do not pay tax on a regular pay cheque, this would constitute a tax loan. The other reason is that it believes that seniors will be able to budget better on a quarterly basis.
What? The senior citizens of this country should rely on budgetary advice from this government? For the record let me read to this House a letter which was sent to my colleague, my benchmate, sponsoring this motion. I will not mention the person's name but it was addressed to Revenue Canada and copied to the Minister of Finance. It said: "Enclosed you will find cheques totalling $1,099.55. The cheque for $162.89 is so-called
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instalment interest which you will have the unmitigated gall to charge me. The cheque for $936.66 covers two instalments of $468.33 for March 15, 1991, and June 15, 1991.
I am a senior citizen and for the many years I have paid income tax. I have always paid in full on April 30 as required. I see no reason to change this procedure and I take exception to being told that I must pay quarterly or be charged interest. I would like to point out that since April 30 you are assessing me with an additional $1,099.55. This will make a total of $2,972.90 paid since April 30, 1991, and since I am on a fixed income this extra money demanded by you is causing a hardship to scrape this money together.
You can rest assured when the next election rolls around I will not be voting Conservative."


An hon. member:: That is a long line.


Stan Kazmierczak Keyes: As my colleague says, that is a pretty long line.
That opinion I trust holds true for the majority of seniors who have had their old age security pensions clawed back, who are at the receiving end of a health care system that this government is cutting back on because of cuts to provinces and transfer payments and the funding of other social programs which we all know they helped build in this country.
This is the same government that tried to de-index pensions for seniors and given its track record will probably try that again. The suggestions we are discussing here this morning are very simple for solving this dilemma.
Another constituent who wrote to my colleague from Winnipeg-St. James said: "The problem can be solved by general averaging over the last three years with no cost to the taxpayers. The federal government issues old age security cheques and CPP cheques every month by computer. So it has the capability to initiate deductions every month from those cheques. Thus, seniors remembering to write cheques quarterly would be eliminated".
All my colleague is asking for, all we are asking for on this side of the House, and I am sure members opposite agree that this all makes common sense, is that we give this country's most esteemed citizens a break. Let us give them the choice. Let us give them the right to whether

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they want to pay their tax annually or every three months.


Mr. Jean-Guy Hudon (Parliamentary Secretary to President of the Queen's Privy Council for Canada and Minister responsible for Constitutional Affairs):: Mr. Speaker, I am pleased to speak on Motion M-484, moved by the hon. member for Winnipeg St. James. It reminds me of one of my first speeches in the House after I was elected in 1984, on the subject of pensions. My colleague opposite just said that the government had wanted to deindex old age pensions. I remember that I had then made my maiden speech in the House and the funniest thing is that I had asked the research service to do research for speaking notes, of course.
When I made my speech in the House, with notes, I remember that my colleague at the time, Mr. Malepart from Laurier-Sainte-Marie, who has since left us, he died, shouted at me from the other side of the House that what I said was silly and made no sense. He said, "Come on, the hon. member must have been hit on the head. It makes no sense!" I replied: "Listen, I am not that out of it. I am reading exactly what you said on the same subject three years ago when you were in power." Mr. Speaker, I must tell you that we sometimes change our stand when we change sides in the House. What I said was not as dumb as all that-it is what he said back then. He was a friend since then because it was always a good joke between us, because he told me that I had caught him that time with his pants down, as we say.
Mr. Speaker, I admit to you that some good, legitimate arguments were made, except that I am fairly close to my constituents and I do not find it to be a big concern with them. That said, just because it is not a big concern does not mean that it is not worth talking about. But I would remind you that the measure concerning payments every three months, or four times a year, does not apply only to seniors. I pay federal and provincial income tax every month because I am paid on a monthly basis, 12 times a year, on the last day of each month. When I worked at the school board, I was paid 26 times a year so I made 26 payments a year for federal and provincial income tax, health insurance, etc.
The measure in question here applies not only to seniors but to all self-employed workers. A special
provision was made for them. All self-employed workers, that is, those whose tax is not deducted at source-of course, seniors are included in that; they do not work or have a regular wage income-must pay four times a year. So it is not a big concern. Some seniors even came to my office and said to me, "Listen, Mr. Hudon, special measures are always being adopted for seniors and I think there is a limit. We do not always want to be treated differently. We are not always looking for special treatment."
Before getting into the main changes in the Pension Plan, I would like to remind the people watching us, the viewers, that there are three complementary levels of pension entitlement in Canada. They are important and benefit all Canadians, including myself. They will benefit my children when they join the workforce and they have benefited and continue to benefit my father and mother back in La Pocatiere. So, there are three levels: the first is the basic entitlement for anyone over 65 and, exceptionally for some over 60 as with the case of widows and widowers. But generally, it is 65. This basic level is presently costing the federal government, that is to say all Canadian taxpayers, $12.1 billion a year and an additional $4 billion for the guaranteed income supplement.
We are talking about $16.1 billion then. By that I do not mean that we are giving so much money and are so generous. I must say that, when I look at the financial situation of some seniors, I feel they would deserve much more. Just the same, this is a major financial effort that cannot be brushed aside and considered as more or less important. As I was saying, all Canadians, the Canadians taxpayers, the workers, are presently paying $16.1 billion for them.
You will remember that, in 1966-1967 I think, the Canada Pension Plan was established for all the public, parapublic and private sector employees. Deductions were made on each pay and we would say: "We will pay you pensions when you retire." Quebec has its own pension plan, the Quebec Pension Plan, but it is administered by a second level of government. So, there is the basic old age pension that everyone is entitled to and then there is the Quebec Pension Plan for Quebecers and the Canada Pension Plan in all other provinces.

The third level, which also costs government money, is that of private pension plans. It costs money in the sense that it deprives government of revenues because, in the case of a private pension plan, one can deduct from his or her income tax amounts that would normally be taxable. So, deductions are made.
Mr. Speaker, maybe the viewers should be reminded also that government is thus deprived of $9.1 billion in revenues annually. It is important to point this out. Mind you, it is important, but the problem is just being displaced because, in fact, the money that I put away and that I deduct from my taxes this year, in five years or in ten years, when I will benefit from this tax measure, I am not sure that the taxation tables will be essentially the same. Generally, the federal and the provincial governments will manage to get a lot more money because the tax tables will have changed.
So, the money or the dollar that I put away today, and that could be taxed at, say, 25 per cent now, how can I possibly know that in ten years, it will not be taxed at 33, 40 or 50 per cent? It is easy to say that the federal government is depriving himself of a revenue. It is easy to say that in a political speech, but I think that the federal government is not really depriving himself of these revenues but rather deferring them.
Mr. Speaker, this deduction done four times per year applies to all those that have revenues other than fixed salaries. Therefore, it is not a special measure for seniors. Mr. Speaker, we are trying to improve the Canada Pension Plan. In 1987, we implemented a rather important reform that was primarly aimed at ensuring a greater accessibility to the Canada Pension Plan. We also improved the situation for workers who change jobs, with the anticipated acquisition of rights to contributions and a greater transferability, in order to protect those workers who change jobs. You know what the situation was when we came into power in 1984 and had to deal with this problem.
The third improvement that we made was the compulsory payment of contributions to survivors, thus providing a greater financial security to spouses of participants to retirement plans. Those are the improvements we made to the system and now, as I was saying earlier, we are improving the tax assistance scheme. I am talking
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about those $9 billion, the collection of which is presently being postponed.
Mr. Speaker, I realize that my time is up. To summarize, I think that this is a very legitimate request. It is a request that was not made in my region, but since I never brought up the matter, maybe it was not brought up to me either. But the seniors appreciate this measure-even though it is not amusing for them to file four returns per year, nor for the lawyers, the notaries and all the independent workers. They feel more secure, they know that by year's end, they will not get a large bill for income tax purposes.
Mr. Speaker, it is a measure that gives a sense of security to Canadians, not only to seniors, but also to all the independent workers.


Mrs. Marlene Catterall (Ottawa West):: Mr. Speaker, I welcome this opportunity this morning to speak to the subject of income tax and senior citizens.

-and to speak in support of the bill put forward by my colleague.
I want to talk mostly about what is unfair in the current situation that requires seniors to pay their income tax on a quarterly basis, based on a $1,000 threshold that has not been adjusted recently for inflation. It is going to continue to move that threshold lower in terms of real income.
What strikes me as fundamentally unfair about this system is that seniors are required to pay tax on income they have not earned and may not, in fact, earn until much later in the year. If they fail to estimate that income correctly-it does change from year to year and estimating it is difficult-they pay a penalty by way of interest.
This means that they are paying a penalty for not paying tax on money they have not even earned as income yet. That seems to me, very clearly, unfair and not at all consistent with one paying a penalty for something one has done wrong. People in that situation have not done anything wrong.
The reverse does not apply. If a senior overpays substantially in the first and second quarter, as is very easy to do, the government does not then turn around and pay them a benefit, because they have loaned the

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government money free of charge for three, six, nine or even twelve months. No. They pay a penalty if they do not pay enough, but they do not get a benefit if they paid the government too much.
Expenses are also part of how much one pays in income tax. For seniors, expenses are particularly unpredictable. These are expenses which are legitimate deductions from income, and therefore affect the tax payable. It is really impossible for a senior to predict in March that they are going to have medical expenses for instance which are deductible and will reduce the amount of tax paid.
I really do not see how we can penalize people because they do not have a crystal ball. None of us have crystal balls and none of us can predict the future, but to disadvantage seniors in particular because they do not have the gift of clairvoyance seems to me particularly nasty.
I want to also say that I think the provision of this is particularly discriminatory. A very large proportion of seniors are women. Given the age and the era in which many of these women were bom and raised, in which they raised their own families, many of them have never earned income. Many of them, if they happen to live in Quebec for instance in a certain period of history, were prevented from owning property and therefore having an income, property and the financial responsibilities of the banking for a family.
We all know the stories of women who were dependent on a mate for every cent they got to spend. They were never able to manage their own money or ever able to have their own money, or to own anything of their own. We are out of the era, fortunately, when a man's home is his castle, and what he does inside it is nobody's business but his own. Unfortunately, many of the people we are talking about who are paying taxes under this unfair system are products of that era, have never had to take financial responsibility, and find it quite difficult to do the kind of thing the government is now insisting they do. Therefore, they become vulnerable to other people who take advantage of their lack of experience, and lack of information, on how to handle these kinds of financial matters. They can really take advantage of and really can put an elderly person at a disadvantage.
We also need to remember that among the elderly there is a high rate of illiteracy. Income tax forms are not exactly conducive to people who grew up in a generation
and, perhaps, did not go to school beyond grades two, three, four or five. Certainly finishing high school and going to university was by far the exception rather than the rule. To require certain skills of a group of elderly people, among whom there are a large number who do not have the reading, writing and number skills that many of us are fortunate to have because of a more advanced educational system when we happened to be growing up, is discriminatory.
Finally, the deterioration in services to the elderly from this government is hitting all members of Parliament in their constituency offices. I know in my office, people may spend days in a row simply trying to get through on the telephone to access even the ability to enquire about their old age pension, or to make an application for it. They may find that they have to go to an office, sit for hours, wait with all the costs and turmoil of doing that, only to be told that they have to come back another day for an appointment and go through it all over again.


The Acting Speaker (Mr. DeBlois):: The hour provided for consideration of Private Members' Business has now expired.

Pursuant to Standing Order 93, the order is dropped to the bottom of the list of the order of precedence on the Order Paper.



GOVERNMENT ORDERS


Hon. Gilles Loiselle (President of the TVeasury Board and Minister of State (Finance)) moved: that Bill C-3, an act respecting the acquisition, administration and disposition of real property by the Government of Canada be now read a second time and referred to Legislative Committee F.


Mr. Bill Kempling (Parliamentary Secretary to President of the TVeasury Board and Minister of State (Finance)):: Mr. Speaker, recently the President of the Treasury Board introduced a bill in this House, Bill C-3,
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an act respecting the acquisition, administration and disposition of federal real property.
I am pleased to be here today to lead off debate on this bill, as we seek to consolidate the policy changes and the new procedures associated with the government's reform of its real property management system.
Five years ago the government was faced with a real property system, some would say lack of a system, under which it was very difficult to know which minister of the Crown had responsibility for which property and for what purpose. Since then, substantial progress has been made. The goal of reform is to improve the effectiveness of the federal land management. When I say land, I refer not only to undeveloped land, but also to land complete with buildings.
To improve management of the federal real property, the cabinet first approved a new regime based on decentralization of authority to the departments that use the property for delivery of services to Canadians. We have cut the red tape to save money, to reduce overhead, and to improve the service to the public. In other words, we moved to modernize the way real property is managed in the government.
We made Treasury Board ministers a focal point for policy and general management decisions. This establishes the decentralization of management work by providing managers in the field with clear lines of accountability.
We have clarified the role of Public Works Canada as manager of federal office buildings and as a source of specialized services to other departments.
We shifted responsibility for the administration of most special buildings, or facilities such as laboratories, to the individual departments actually using those facilities.
The result is a very highly decentralized system with authority and accountability vested in program departments, rather than central agencies, and administered by local property managers, not Ottawa.
The special group known as the Bureau of Real Property Management was set up within the Treasury Board secretariat to manage and co-ordinate the process of decentralization, as well as providing advice to the
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Treasury Board ministers on their new role in looking after real property.
With these important reforms in place, we turned our attention to the method used for federal real property conveyancing. Bill C-3 is one of the last steps needed to complete the simplification and modernization of the way federal lands and buildings are managed.
The federal real property management act will bring together, in one statute, the general authorities necessary to buy, sell or lease the lands and buildings used by government departments to deliver the programs to the Canadian public. It would enable the government to use the same means to buy or sell property that are used by the private sector, but with appropriate controls in place. This would make it faster and easier for the private sector to deal with the government. It would increase efficiency in property transactions, reduce delays, and eliminate differences in approach that now exist between the government and the private sector. In Alberta, we will be able to do things the Albertan way and in Ontario, the way they do things in Ontario, and so on.
The bill would give the government the flexibility it needs to be an efficient manager of real property. It would improve service to the public in a significant way by allowing the government to use modem methods in dealing with Canadians when it buys, sells, leases or transfers lands or buildings.
I am pleased to submit these proposals to the House today. However useful they may be, these proposals are strictly limited in scope. Let me explain. First, they would not affect the management of lands governed by special legislation such as the Indian Act, the National Parks Act or the Territorial Lands Act. In each case, the specialized legislation would override the federal real property act. Nor would these proposals affect the management of lands held by Crown corporations. These corporations would continue to manage properties in support of their commercial and public policy objectives, under their own legislation, or under the Financial Administration Act.
The federal real property act would, however, apply to the property transactions of about 20 departments of the federal Public Service that hold land for delivery of programs to Canadians. The diversity of these holdings would surprise you, Mr. Speaker, covering everything

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from cultural centres to defence bases, employment centres, nursing stations, research labs, farms, airports, prisons, police detachments, embassies, consulates and about 25,000 residences in Canada and around the world. About 85 per cent of these facilities are outside of Ottawa.
The vast majority of this property is devoted to providing direct service to the public. It represents the full range of facilities needed to deliver the federal government services to the Canadian public. The federal government is the largest real property holder in Canada. We control a large, diverse and complex portfolio of real estate. Excluding the territories, we manage some 28 million square metres of building space and about 23 million hectares of land. If all this land was put in one place, it would cover about the same area as Great Britain. The sheer number, and diversity, of federal land holdings makes for thousands of property transactions a year. That is why it was absolutely necessary that decision making and managerial accountability be decentralized. That is why legislation to support this improved management structure must keep pace.
The new regime for real property management is in keeping with our overriding goal of improving services to the public. It gives the managers more direct responsibility and holds them accountable for the results.
Under the present law many, if not most, real property decisions concern acquisitions, and purchases must come from Ottawa. The decision making process is highly centralized. The proposed legislation would allow the government to delegate these decisions outside Ottawa where it makes good business sense to do so.
Currently, three separate and often conflicting statutes govern the way real property transactions are handled. These statutes are the Public Lands Grants Act, the Public Works Act (Part II) and the Surplus Crown Assets Act. These acts are complex and out of date.
The Public Lands Grants Act and Part II of the Public Works Act as they apply to real estate transactions are essentially unchanged from the 1890s. That is the 1890s, Mr. Speaker.
We have been operating with a real policy regime designed for the horse and buggy era dealing with assets that are virtually priceless, and that belong to all taxpayers of Canada. It is clearly time that this obsolete legislation be modernized.
The third piece of legislation, the Surplus Crown Assets Act, was designed to deal primarily with surplus office furniture and equipment, not with lands. It is inadequate to deal with real property.
These statutes do not allow the use of modem real property methods or practices similar to those followed in the private sector. They use different terms to describe the same things and they use different mechanisms to carry out the same kind of transactions. Under these old laws, selling even a small piece of property can take from six to nine months after a decision has been made.
Take, for example, the sale of a modest house that used to serve as the residence of an RCMP officer in a remote British Columbia detachment. Today the house has outlived its usefulness and the RCMP has decided that it should be sold. Under the present rules, it would probably take the agreement of two cabinet committees and processing by as many as five government departments, over a period of six to nine months, to complete the sale. Most of the work would be done in Ottawa, far from the local market, with the attendant risk of errors.
You could imagine the headache that this kind of transaction causes Canadians across the country trying to buy property from the federal government.
With the flexibility of the proposed new act the same transaction would take six to eight weeks, that is, 60 or 80 per cent faster, and involve a British Columbia-based RCMP official and a local Department of Justice lawyer.
I trust you will agree, Mr. Speaker, that this is much better than six to nine months, and a big improvement in service to the public.
Similarly, under the law, it is no easy matter to surrender a lease, even in situations in which a terminating lease is beneficial to the tenant, and to the government. Managers in the field do not have the authority necessary to make the decision.
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Let us say that a concessionaire in Halifax International Airport wishes to relocate to larger premises in the same building. The government agrees that the new space rents for more money and a new tenant is already waiting for the old premises. At present, because this move involves the surrender of an existing lease, the decision can only be made with the approval of the Governor in Council, on the recommendation of the Treasury Board, on a submission by the Minister of Transport. Obviously this process is time consuming and is neither efficient nor service-oriented.
For the most part, the legislation we are proposing today clarifies, codifies and simplifies existing practices in legislation to ensure good management of real property transactions such as the procedures used to make transfers between ministers and between governments.
The proposed legislation clarifies the role of individual government departments with land holdings. The bill emphasizes that federal real property is a long-term asset of the people of Canada. Departments are the temporary stewards of the land they hold to deliver their programs.
The bill also clarifies the role of the Department of Justice in ensuring that the interests of the Government of Canada, and thus the people of Canada, are served in property transactions.
In conclusion, the provision of this bill would clarify and simplify the current arrangements for buying, selling, leasing, licensing and transferring federal real property. These measures are straightforward, as I have said. They are designed to eliminate inconsistencies between laws that treat similar transactions in different ways, and use modem methods in federal land transactions.
The passage of the proposed federal real property act would improve service to the public by reducing delays and frustration on the part of the public that deals with the government on property transactions. It would reduce the cost and increase the efficiency of how the government manages our properties.
For these reasons, I believe the passage of the proposed legislation will enable us to better manage the real property assets that we hold for all Canadians.


Mr. Mark Assad (Gatineau-La Lievre):: Mr. Speaker, Bill C-3 clearly reflects the government's desire to
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simplify procedures in an area of administration that can be very complex, as the government member pointed out. All federal government land put together would cover roughly the same area as England. That is a lot of territory to manage, and in recent years, procedures had become very unwieldy.
When I was in the National Assembly, for instance, we had the same system we have here, and when there were "letters patent", it could take six or eight months to get them, if we were lucky. My point is that transactions of this kind do not reflect current procedures or transactions in the private sector, which is often a source of frustration.
The bill contains a number of elements that are most welcome, of course, but this is something that evolved gradually. There is a story behind those elements, and I would like to explain the reason for a bill of this scope. There may also be a few omissions that perhaps our government colleagues would be able to clarify.
Mr. Speaker, in 1985, the study team on real property management, established by the Ministerial Task Force on Program Review-there were an enormous number of programs, and this was under Mr. Nielsen, the minister at the time-this study team published a report that mentioned a number of shortcomings in management procedures for federal real property.
There were several recommendations for simplifying and updating the procedures then in effect, and these recommendations were subsequently adopted by Cabinet. Following Cabinet's decision, that same year Treasury Board set up the Bureau of Real Property Management responsible for co-ordinating management of the federal government's real property. With the co-operation of the Department of Justice and all responsible departments, the Bureau proceeded with a review of the instruments used to grant federal property.
The Bureau reported its findings, and I will mention some of these later on. The bill itself is fairly technical, and I would rather not get into the technical aspects. The three main bodies of legislation that governed federal real property conveyancing and which are currently in effect-the Public Lands Grants Act, the Public Works Act and the Surplus Crown Assets Act-no longer reflected current real property management methods and techniques. The first two have not changed much since they came into effect, that would be in the 1890s,

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while the last one is better suited for disposing of personal property than real property.
These acts contain inconsistencies as regards the methods and procedures. They are redundant and thus are confusing for the people handling the transfers.
Finally, Bill C-3 was designed to correct the many deficiencies in the present system. This legislation intended to update and streamline the methods used in the administration and disposition of federal real property will give a clearer definition of management responsibilities regarding public lands. It will also be useful to codify and revise legal provisions concerning many similar real estate transactions, if not all.
Here is the question I want to ask my colleague opposite. From what I understood, this legislation will apply to all public lands. One of the weaknesses of the bill was that it was not clear that all Crown lands would be covered. So, Bill C-3 will repeal the entire Territorial Lands Act and amend the Public Works Act and the Surplus Crown Assets Act so as to exclude from the application of these acts real estate transactions covered by this legislation.
Mr. Speaker, the hon. member mentioned earlier some form of accountability on the part of management. That is what I want to hear about. Will the accountability of managers that is in this bill really be there in fact? In the past, many people had dealings with the federal government and when there was confusion-I admit that the laws governing Crown buildings and land are very confusing. It would be a good idea in the bill, and it is not clear, that is one of its weaknesses-Will accountability really be there in fact? It would be a good idea to clear up the confusion that has existed on many occasions.
I would also point out that with a single piece of legislation to manage all Crown lands and even buildings, no doubt this statutory authority will make it unnecessary to search through all the current legislation to see who has the last word. Indeed, with this bill, the statutory authority will be the departments' responsibility and managers will be responsible for ensuring that in every department, these transactions comply with all the requirements the government put in the bill. No doubt the time transactions take will be greatly reduced, as it
should be, because transactions these days must be done quickly-we are no longer in the 19th century, when they could take years. Modem methods today require the government to keep up to date in it real estate transactions.
But one of the weaknesses we were able to note is that the bill does not specify how the procedure will work. For example, there is no specification now of how an individual would go about acquiring Crown land or how a particular department that has extra property in a given place would market it. I would like to know if he intends in committee to elaborate on the procedure to be implemented and what the chances for an individual dissatisfied with the procedure, to lodge an appeal?
I would also like to know something else. Pursuant to section 16, paragraph one, the Governor on Council may appoint an ad hoc review committee to make a decision. We would want assurances that, in case of improprieties, this committee established under the authority of the Governor in Council could be called before this House.
Finally, Mr. Speaker, I would like the government to tell us whether all Crown lands-indeed those the hon. member mentioned-will be covered by this bill, including all government leases on buildings? The hon. member talked about 28 million square meters of building space. The federal government is obviously both the biggest tenant and the biggest land owner. Those are the points we would like the government to clarify before this bill can pass third reading.


Mr. Steve Butland (Sault Ste. Marie):: Mr. Speaker, it gives me pleasure to rise and speak to Bill C-3, the bill dealing with the real property of the federal government. It has taken great pains to indicate to us that this is a veiy technical bill that we should pass very quickly through the House. Right away that give us some concern, but for the most part we approve of the vast majority of this bill and we do not want to be obstructionist. I will touch on what we think are the key elements of the bill and some of the concerns we have, although few in number we believe major in content, and we hope that the government will see its way clear to approve a couple of amendments that we believe are necessary in this bill.

The size of the bill, as a couple of my colleagues have suggested, is immense. We are talking about office buildings, houses, parks, police detachments, consulates, dry docks, employment offices. We have no doubt the federal government is the largest land and building owner in this country. Am I to believe it is $60 billion and the expenditure per year in this area is $6 billion. We may be speaking of a bill of a highly technical nature, but indeed it is a bill that could impact on everybody in this country.
It has been told to us that some of the language is archaic and the act is arcane and it is a hundred and some years out-dated. One could ask the question that if it was that bad, why did we not get to it beforehand.
It reminds me as bit of the UI bill and that gives me some concern. It is very technical and complex. It has lots of regulations. It is irrelevant and impractical at times. But when you get down to it, the interpretations of the regulations can be indeed very important to ordinary Canadians.
Inconsequential? Certainly not. We have received a tremendous amount of assurances, including from the creator of the bill. When I spoke to the creator of the bill and asked him whether any of our amendments would be acceptable, he seemed quite concerned or upset that I would suggest amending his creation.
I can understand that. Things that I put together I do not wish people to tamper with either, especially since, like a sculptor, he spent two years putting this bill together. Again, we will be proposing some amendments to the bill.
As far as the technicalities of the bill are concerned, they do expedite the system and that is good. Anything that can go from eight months to eight weeks will benefit all of those people, especially those involved in real estate transactions.
I think it is important that we try to put in some case studies. In my own community, a disagreement between Transport Canada and Parks Canada actually delayed a project for over a year in the community. As a result of that delay in the project, they are suggesting there are no more funds for the project, which may or may not be true.
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It points out that the civil servants themselves, interdepartmentally, have difficulty getting a transaction through the process. Any expediting of the process indeed will be a bonus.
They point out to us that in the internal process, there will be a great deal of accountability. What the process does not uncover, the Auditor General will uncover. What the Auditor General does not uncover, a minister will uncover.
That is the accountability process within the department. Our concern will be at the end of the transactions. Will there be any final accountability? What we are suggesting among other things: one, a land and building inventory which, much to my surprise and I am sure to millions of Canadians, we have not had in place. As I speak, we do not have an inventory of properties in place.
They again assure us that we are in the process of doing that and it will be ready in 1992. Again, you are begged to ask the question: Why not previously? If we have $60 billion of assets, surely we would want them listed. There is an inventory that we believe is coming into place, and that is good.
We are saying that at the end, there should be an accountability clause in place-call it what you will, a depository-for all of the transactions that are completed on a monthly basis or on a bi-monthly basis or whatever, I will leave that up to the government. There should be a depository so that a citizen who is concerned and a citizen who deals with any aspect of Canadian life, be he integrally involved in real estate or not, has access to the depository to find out what the transaction was about and who are the principals.
I understand there would have to be some confidentiality involved in this depository. The government has suggested to me that I can go through the Access to Information Act. May I say that that is a very onerous exercise even for someone who might understand that system.
If the government is truly concerned with accountability for what it does, it will put together and initiate a depository that is extremely available. If the system is squeaky clean as the government is suggesting it will be because of all of the checks and balances of the system, that is great.

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We must not only be absolutely squeaky clean, but we must appear to be completely devoid of any possibility of a scandal, a land scandal or whatever. It is not unknown or foreign to some people, mainly past, who have become involved in some of the land dealings.
There has been some innuendo and even court cases as to whether or not all of the government officials had acted in a proper fashion.
This depository would provide that last line of defence, that last safeguard that would prevent any possibility or potential, we believe, for abuse of the process. My friend from Victoria asked had there been an extensive consultation process. I am not aware of one, so I will not suggest that there was not one, but there was no indication from all of the briefing that I had that a consultation process was in place or pursued. But I would suggest that probably those involved would endorse this. I think, for the most part, the intent and most of the content of the bill is positive in nature. We would prefer not to sully the bill or the creator of the bill with any amendments, but there is no indication of any sound rationale yet as to why they would not accept the amendments; in fact, there is some dialogue back and forth suggesting that, yes, we see your point. They are talking about discretion, and there is little discretion within the system, but when it comes down to the final ministerial discretion, that minister may indeed have a tremendous amount of discretion. There is some suggestion that the government may be able to tailor-make land dealings to the benefit of somebody-to a community, for instance. If you had access to property in a community, and the federal government would like to give this piece of property to a city for a minimal amount, like $1,1 think that is good. It could be a policy that could be beneficial to everybody and would give a boost to a community that might need a boost-disregarding the market value.
Once again, if we offered this discretion just carte blanche to a minister or to a group of people, this indeed could lead to the concerns we have already mentioned, that people would suggest that things were not exactly as they were and they were politically motivated to dispense of property and/or building. So, even a very positive aspect of the discretionary aspect of the bill could become negative.
It is unfortunate that bills of this nature have to be so complex and technical, and it certainly was an education for me to get into some of the real estate jargon and legalese. I do not fully comprehend all of those aspects but I do understand full well the content. The perception that I have after having spent many hours with this bill is that the only criticism remaining is the accountability at the end of it, which remains vague at best and probably not in place at all.
We have tried to be as positive as possible in describing what is in the bill and our concerns. I do have in my hand endless numbers of clippings dealing with the negative aspects of this bill. It has caused the government in the past-and not only this government but many governments, and many individuals-a great deal of grief. So, the potential is there for scandal. An ounce of prevention, indeed, is worth a pound of cure.
We are suggesting that the depository is a must, before this bill goes forward with the endorsation of the New Democratic Party.


Mr. John Brewin (Victoria):: Mr. Speaker, I have a question for my friend from Sault Ste. Marie. The bill in subclause 16(2) outlines a set of regulations that the Governor in Council may make. This is a very comprehensive set of regulations which, as I understand it under the scheme of the legislation, is going to govern how real estate transactions of the federal government are to take place. Yet the previous subclause seems to give the Governor in Council the opportunity to simply opt out of any regulations made under the clause.
My friend referred to that in his comments, but I wonder if he would elaborate on the extent of the discretionary authority and particularly the differences between the provisions in this bill and the provisions of the Financial Administration Act which would seem to be more restrictive and, therefore, give this Parliament, if more restrictive, the assurance that the regulations in fact will be the things that govern. In particular, it is because regulations have a public process that they have to go through and if cabinet can simply walk past the regulations, it would seem to me that it might offer some undue scope for an abuse of the process contrary to the intention of Parliament.
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Steve Butland: Mr. Speaker, I thank my colleague for the technical question on this technical bill. I suppose it is important because that is probably an aspect of the bill that I did not perhaps spend enough time on, but that is, of course, another concern we have, probably the two major concerns.
If the government in fact is suggesting that all of these new regulations are necessary to address all the potential transactions of the federal government in real property dealings, it begs the question: Why is the opting out clause notwithstanding any regulations necessary?
I am told that under the previous act this opting out clause is there, but it has never been used. Again the question is: If it has never been used for one hundred and some years and it should not have to be used now and forever after, why is the opting out clause there? It touches on the discretionary aspect of the bill that I did highlight, that there is no discretion internally in the process that is excellent, but the government may opt out just by simply saying we opt out of all of the regulations that we have put in place. That is the way I understand that.


John F. Brewin: Mr. Speaker, I rise to make a few comments on this bill. First, I would congratulate my friend from Sault Ste. Marie, who has sat next to me throughout this Parliament, on his very clear and competent speech on this bill setting out our position on it.
I would like to, however, add a few comments of my own partly based on my experience from Victoria where we have substantial federal properties, some of them vacant and some of them used, and a series of problems have emerged in the experience that I have had over the last couple of years that this bill, I hope, in part addresses. I would like to see some assurances from the government that it will address others that do not seem now to be covered by the bill.
In the question I put to my friend from Sault Ste. Marie just before I rose to speak on the bill, he dealt with the issue of clause 16 and the opportunity the government has to opt out. He made the very persuasive point that this clause, giving the government the right to opt out, is justified by the government on the basis that it never used it.
It seems to me that we have here an example of almost a conflict of interest that sometimes emerges between the government as government and the majority in the
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House of Commons, the government acting as the leader of the majority in the House of Commons.
It seems to me that we as parliamentarians, all of us on all sides of the House, because this is not a partisan bill, should be insisting that safeguards of the public interest be written into legislation. Too often the government gets persuaded by its public servants to approve an internal system which is easier to regulate internally and overlooks the need to protect the public interest by a process of public accountability.
Clause 16(1) for example could do with a simple amendment that at any time the Governor in Council intended to exercise its powers under clause 16(1), it must be required in advance to report to a parliamentary committee or some other form of process of that kind so that the spotlight of public attention would be on the transaction, and the government would be obliged to account in the court of public opinion and in the court of this Parliament for its intention to try to explain why it was going around the normal regulations and procedures.
I would endorse as well in that context the recommendation of the member for Sault Ste. Marie for a complete public inventory of federally owned lands. There are, as has already been noted in this debate, 60,000 buildings in this country owned by the federal government, many of them very substantial buildings, 23 million hectares. The annual expenditures on buildings is over $6 billion.
This is a massive public responsibility which the government has in the administration of its lands and buildings. It is all behind closed doors except for the various cumbersome methods of trying to get the details out. The accountability of the government for its management of public lands is a difficult thing for the public to achieve under the present system. This bill does nothing to address that question.
If there is to be an inventory of the government's lands and buildings by December 31 of this year, as the government has assured us, why should that not be part of the legislation? Why should it not be a simple requirement that the government maintain an inventory of all of its land and buildings and further that it maintain a public inventory and registrar of all the transactions? Those transactions are recorded in public land offices across the country. It would be no trick at all

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for the government to simply duplicate that process in a federal depository of land transactions so that any land transaction that occurred could quickly come to the attention of any member of the public who sought it as a companion to a public inventory of federal government lands.
The practical result of this has come to us in the Victoria area. The Department of National Defence is a major land owner in the Victoria area. Huge lands, much of which, as far as I can surmise, is completely superfluous to the actual usage by the Department of National Defence.
I have been told that there is an inventory being made of this. Even within the government there are pressures from one department to try to take advantage of those lands for public purposes, for example, social housing. I notice the member for Don Mills is in the House. He was the the Minister of Housing and I know his interest had been to improve the availability of federal lands for housing. I know as well that that is a continuing interest of the government in seeking to have more lands available.
The Department of National Defence, with all its surplus lands simply says, apparently: "We may need this some day in the long run and you can't have it". All of that process operates internally to the government.
The time has come to get that out of the back rooms and into the public so that the public can participate in that discussion and departments such as the Department of National Defence are far more clearly held accountable for their stewardship of the lands they have.
In the chosen area of greater Victoria, there is an area called Rocky Point, a huge area of land, to which is adjacent a national marine park, a small park. It would be an extremely good and valuable use of those lands to turn them into a national park. A very small fraction of those lands are now used to store ammunition for the navy.
I am quite confident that there has been no rigorous look at whether those lands are surplus, no imaginative look. The Department of National Defence has hoarded those lands. It seems to me that if this bill is to afford
Canadians the assurances that the government says it does, this should be brought out into the public and an opportunity given to look at the extent of surplus lands to government uses and to have a more public process for reviewing surplus lands, having government departments accountable for their use of lands so we can possibly begin to achieve some of the other purposes for which public land and buildings are needed.
A final aspect I would like to address is another public interest in government lands, and that is heritage. There is, again, a good internal system in the government for determining which federal government properties have heritage value. The Federal Heritage Review Board does that job and from everything I can see, does it very well.
The result is that if any other department seeks to use designated federal heritage buddings, it must in effect have that question referred to the review board, and the board wdl pass judgment on that. That is a good internal process.
Again, it is a process which should be brought out into the open. There should be a statutory provision establishing the heritage review process. There should be a statutory provision that requires reference to the heritage review board whenever an officially designated budding is to be treated in some form or another by a federal department.
Again we have an example of that in Victoria, where there is a long standing property, Gonzales Hdl, which was used as the first weather station on the west coast and an observation station during World Wars I and II. That building is now largely surplus as a weather station for the meteorological service but it has great heritage value and has been designated heritage.
Another arm of the government has said the land around that budding is surplus and should be sold off for expensive luxury housing. That decision has all been internal. If the wishes of the people of Victoria were taken into account, the whole of that property would be preserved in the public domain.
There are negotiations going on to try to achieve that objective. It is important that, in support of the heritage aspects of the federal government's responsibdity, this be given some statutory recognition and this would be a very valuable bdl to do this.
October 7, 1991

I propose to be introducing shortly a Private Member's bill to lead to the establishment of a national heritage policy in this country and I will be including those provisions. It would be far more effective if the government took the leadership on this and included these kinds of provisions in this bill.
Heritage of our building in Canada could be achieved in a whole range of ways, including the government establishing a policy that federal heritage buildings which are excess be used by federal departments far more efficiently than they have been so that our heritage can be preserved and maintained.
Let me conclude with a final point with respect to the way in which the federal government approaches its neighbours in planning the use of federal government properties.
Given the nature of this country and the age of buildings, we are now seeing more and more redevelopment across the country. In our area we have Ogden Point, a large parcel of land, a very critical parcel of land on the entrance to Victoria harbour.
In the early days of the development of Victoria, these federal lands were predominantly used for shipping, for the receiving of goods and essentially for industrial use connected with the passage of goods and services through the port of Victoria.
Much of that usage is now becoming obsolete with the change of transportation systems and the changes in the economy. The Government of Canada now has a large piece of very critical land for the development in Victoria that is surplus. What we see, however, is that in the process of redevelopment, the federal government internally proceeding to reach conclusions about the best use of that land with minimal consultation with the local communities and the local municipalities.
That has been the past record. There are signs of improvement. In this case, Transport Canada is the department responsible for the lands and the office in Vancouver has been very forthcoming in beginning a consultative process with the municipality in Victoria, and beginning slowly and tentatively a process of consultation with the community. It is far too tentative, however, far too much dependent upon the good will of particular public servants in particular regions.
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I think it is incumbent upon the government, as a manager of real property, to provide a far better statutory base for what is the general policy of the government, that it will not develop its own lands without consent from the local municipality. That is a general policy, but it is a policy which is also honoured at least as much in the breaches of the observance whenever there is a controversy.
In this Ogden Point land I was speaking about, the federal government agreed to the establishment of a heliport which was wanted by some people in the community, but was definitely not desired by others in the community, including the unanimous vote of the council of the city of Victoria. Despite the unanimous vote of the council of the city of Victoria, despite the feeling of the neighbours, the government went ahead with this use. That is simply wrong. It is not a process which should be followed, and it is a process which should be corrected in this bill.
We on this side have a number of concerns about the bill. We appreciate the great importance of improving the system of land transactions. We congratulate the authors of this bill for bringing it forward on that ground. It is an important bill. Anyone who has ever had to have any real estate dealings with the federal government knows that, and we wish to facilitate its adoption. We also want to hear from the government a response to our concerns on the issues that have been raised by the member for Sault Ste. Marie and myself. They are important concerns, ones that we think are shared by many others across this country who have had dealings in this area.
We would like to hear from the government that it is willing to entertain amendments to just tighten up the bill in this respect.


Steve Butland: Mr. Speaker, I must admit I perhaps got caught up in the technicalities of the bill. I think the member for Victoria has made a very very good point for all members of Parliament and probably for all Canadians. He obviously has a good handle on what is going on in his own constituency.
I must admit I perhaps do not have that kind of handle, but it points out the impact that the bill could have. We should pay attention to it.

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As he was speaking I was trying to say: Do I have any case points to relate? I remember the post office. There was a controversy over the post office as to who was going to renovate the post office. I believe it belonged to Public Works.
As soon as Public Works found out it was going to have to spend money, it said: "It does not belong to us. It belongs to Canada Post." I called Canada Post and it said: "It belongs to Public Works."
If the inventory is in place, it is still having problems. The member has pointed out that there are ramifications of this bill. Certainly, the process of which he spoke has unlimited potential. For instance, we should take a serious look in each constituency in this country with the municipality, the province and the federal government. We should look at our excess lands and get away from: "This is my turf and don't you dare come on to it" and look at it for the benefit of all Canadians.
There is unlimited financial potential. It still staggers my imagination that we could have $60 billion worth of real property in this country.
It is not a question but I would ask the member if he wants to react to what I said.


John F. Brewin: Mr. Speaker, I will certainly react to his modesty in suggesting that he may not be as aware of the problems of his own constituency.
My experience with the member for Sault Ste. Marie since he has come here is that he is one of the most indefatigable constituency members in the country. "Indefatigable" may not be a word in common usage in every part of Sault Ste. Marie, but it means extremely hard working and very knowledgeable about the problems in his constituency.
Beyond that, I think he simply reinforced the point that I have made. I will leave it at that, and I look forward to hearing from the government in response to some of the points that we have suggested.


Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, on the same point, I have to agree that nobody seems to have the pulse or grasp of these property holdings of the federal government.
I do believe that in committee one could favourably look at the public inventory over federal lands. I think that is a good proposal.
I am wondering since the last comment made by my friend from Victoria. Based on the definition in the bill, I think it is clause 2, the bill would only apply to properties belonging to the federal Crown or of which the federal Crown had power to dispose depending upon how one defines federal real property.
That remains for us to decide in committee. If the Crown corporations, for example, have ownership rights over their holdings, I do not think this bill would apply to these holdings and these properties would not be covered by this bill.
I wonder if the member could confirm this for me. Crown corporations have large holdings of properties in Canada. I am thinking of the national capital region. The National Capital Commission has large holdings.
CMHC in my riding has large holdings which it is intending to dispose of. Does this bill touch Crown corporations in the member's view?


John F. Brewin: Mr. Speaker, it does not. I and my colleague from Sault Ste. Marie with whom I have consulted agree it ought not to confuse the issue. There is a very distinct set of problems related to lands held by Crown corporations and the government in that capacity.
That is not to say there is not a need for taking a look at how Crown corporations in this country administer their lands and the governments over all responsibility for the administration of all the lands. I would not be surprised at all to find that there are surplus lands that might be used better, and that the government should be following that through.
I know Treasury Board has some functions in that area and has some people working at it. It probably could be done a lot better. I also agree with an earlier comment my hon. friend from Sault Ste. Marie made about the problems that sometimes occur in a relationship between the two.
In Victoria we have a post office building that is being changed around and Public Works has been very responsive in that case to the needs of the people of Victoria in trying to improve that building, but it is still like pulling teeth and it should be a public process with Crown corporations as well as with the federal government.


William James Kempling: If I could just clarify a couple of points. This act would not apply to the National Parks Act, the Indian Act, the Territorial Lands Act, the Canadian Petroleum

Resources Act, the Fishing and Recreational Harbours Act and with several Crown corporations. It would not apply to any of those institutions.


The Acting Speaker (Mr. DeBlois):: Resuming debate.
Is the House ready for the question?


Some hon. members:: Question.


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


Some hon. members:: Agreed.


[Stage Direction]
Motion agreed to, bill read the second time and referred to Legislative Committee F.

Hon. John McDermid (for the Minister of Finance) moved: that Bill C-18, an Act to amend the Income Tax Act, the Canada Pension Plan, the Cultural Property Export and Import Act, the Income Tctx Conventions Interpretation Act, the Tax Court of Canada Act, the Unemployment Insurance Act, the Canada-Newfoundland Atlantic Accord Implementation Act, the Canada- Nova Scotia Offshore Petroleum Resources Accord Implementation Act and certain related Acts, be now read the second time and referred to Legislative Committee E.
He said: Mr. Speaker, I have the pleasure of presenting, for the consideration of this House on second reading, Bill C-18, An Act to Amend the Income T&x and related Acts.

This bill is, as I am sure hon. members will appreciate, significant in both its physical size and its scope. It includes income tax measures from the 1990 and 1991 budgets, several items announced through press releases in 1990 and 1991, and a large number of technical amendments.
Since the measures were first announced, extensive consultations have taken place between the Department of Finance and taxpayers and their advisers on the more
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technical aspects of this bill. These consultations have been of great help in identifying ways in which the details of the income tax system could be improved. Those improvements, together with the other amendments included in Bill C-18, will help to maintain and enhance the tax system's equity and efficiency. This goal, in turn, forms an important part of the government's commitment to a healthy Canadian economy.
I would now like to describe some of the major features of this bill, beginning with those income tax measures which form part of the budget brought down by the Minister of Industry, Science and Technology and International Trade, the former Minister of Finance, on February 20, 1990. These measures relate to the taxation of non-residents and life insurers, donations of Canadian cultural property, pension plans and registered education savings plans.
A basic element of the government's tax policy is the fair taxation of all income earned in Canada. The 1990 budget included initiatives to ensure that non-residents who deal in Canadian real estate or who create mutual funds to invest in Canadian real estate are taxed appropriately. The budget also proposed that the tax on financial institutions, introduced as part of tax reform, will be extended to life insurance companies. All of these measures have been incorporated in Bill C-18.
A second 1990 budget item relates to gifts of cultural property. In order to encourage the developments and dissemination of Canadian culture, the Income Tax Act provides special tax treatment for persons who donate cultural property to certain Canadian institutions or public authorities.
Bill C-18 will enhance the role of the Canadian Cultural Property Export Review Board in assessing the value of such property, and will thus streamline the rules governing cultural donations.
A third 1990 budget measure concerns pension funds. For many Canadians, retirement planning centres on a pension fund which invests their own, and their employers' contributions, to provide future income. Before 1990, such funds were subject to a special tax if more than 10 per cent of their assets consisted of foreign

October 7, 1991
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property. Recognizing the advantages of investment diversification, this bill includes the 1990 budget proposal to allow pension funds to invest up to 20 per cent of their assets in foreign property by 1994.
The final 1990 budget measure forming part of Bill C-18 is a refinement of the rules relating to registered education savings plans. Changes will limit the total amount that may be contributed in respect of each beneficiary and will allow the payment of benefits to a beneficiary under a new plan only if he or she is a full-time student. Together with other related changes, these amendments will improve controls over the plans.
Other income tax measures included in Bill C-18 were announced in the budget introduced by the former Minister of Finance on February 26 of this year. These include special provisions for Canadians with disabilities and a modification of the taxation of gains on the shares of small business corporations.
In November 1990 the Minister of State Responsible for the Status of Disabled Persons announced a broad government strategy to promote equal opportunities for Canadians with disabilities. A number of measures in Bill C-18 bring that strategy to bear on the income tax system. First, the disability tax credit will be increased for 1991 from $575 to $700. This will increase federal assistance to disabled Canadians by $35 million a year. As well, the existing criteria for eligibility for the credit will be codified to ensure fair and uniform application.
The medical expense tax credit will also be enhanced by allowing non-working Canadians with disabilities to receive a credit for part-time attendant care and by expanding the list of medical expenses eligible for credit.
The cost of building renovations made to improve access for those with a disability will be deductible by the building owner immediately, rather than over a number of years. Many small businesses have complained to the government in this area and I think this is a major improvement for small businesses and for others to modify their buildings to assure that there is accessibility for those who have disabilities. This, of course, will help them immensely.
Where an employer provides transportation or related benefits to a blind employee or one whose mobility is
impaired, or provides an attendant to help a disabled employee perform his or her work, those benefits will not be included in the employee's income. That is another great advantage that we are placing in this bill.
Last, an individual receiving Canada or Quebec Pension Plan disability benefits in a lump sum will effectively be able to have those benefits taxed in the years in which they relate, rather than have the entire amount taxed in the year that it is received.

As I have said, these measures improve the ways in which the tax system delivers benefits to a group of Canadians most in need-those with physical or mental disabilities.

Another 1991 budget item included in Bill C-18 relates to the tax treatment of small business shareholding. An individual who realizes a capital gain on the disposition of shares of a qualifying small business corporation is eligible for an enhanced capital gains exemption of $500,000. Where a successful private corporation wants to expand, however, and does so by having its shares listed on a prescribed stock exchange in Canada, it will cease to be a qualifying small business corporation.
The enhanced exemption will then be unavailable to the original shareholders, even in respect of gains which accrued while the corporation did quality. Penalizing successful businesses in this way is counterproductive.
In order to allow a corporation to go public without sacrificing its shareholders' enhanced exemption, Bill C-18 will permit an individual to realize some or all of the latent capital gains on the shares without having actually to dispose of them. This measure is in keeping with the federal government's recognition of the pivotal economic role played by small business.
In addition to the income tax measures announced in the 1990 and 1991 budgets, Bill C-18 includes a number of provisions announced separately. Some of these are essentially technical in nature while others present significant tax initiatives. There are, for example, new rules relating to national labour-sponsored venture

capital corporations. These will encourage investment in small and developing businesses.
Other important amendments revise the system of tax benefits for residents of Canada's northern and isolated regions, simplify the computation of the investment income tax paid by life insurance companies, and implement what are known as the available-for-use rules for the timing of certain expenses and credits.
The government's commitment to culture and the arts, which I mentioned in describing the new rules for gifts of cultural property, is also reflected in measures included in this bill specifically to benefit artists. Employed artists will be able to claim a deduction for expenses incurred in the exercise of their artistic employment. A self-employed artist who donates certified works to designated institutions or public authorities will be entitled to claim a charitable tax credit without having the value of those works included in income. This is all part of the package of the federal government recognizing the importance of the artist to Canadian culture.
Bill C-18 also includes the package of provisions recently released by the Minister of National Revenue and designed to enhance administration fairness. These provisions give the minister discretion in a number of key areas. For example, the minister will be able to adjust the amount of tax payable and refund any overpayment should a taxpayer discover after the expiry of the normal reassessment period that he or she inadvertently had failed to claim a deduction.
The minister will also be able to waive penalties and interest where an individual has failed to comply with the law because of extraordinary circumstances such as a natural disaster or serious illness. I have run into these problems in my riding with small businesses. I am sure every member of the House has. These measures add significantly to the flexibility and responsiveness of the income tax system.
The final category of provisions included in Bill C-18 consists of a large number of what I call technical amendments. Many of these provide relief for taxpayers in unanticipated situations where the existing law would operate inappropriately. Other provisions ensure the internal consistency of the tax system or clarify ambiguous provisions. A few correct anomalies that unduly
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favour certain taxpayers and a few reflect minor policy changes. Almost all of the technical amendments formed part of draft legislation released by the government in July 1990 and again in a revised version in February of this year.
The current legislation is, as I noted at the outset of my remarks, the product of extensive consultations with taxpayers and their advisers over that period.
I will not describe the technical amendments in any detail. Instead I refer hon. members to the explanatory notes prepared by the Department of Finance. These describe the entire bill clause by clause in ordinary, or at least relatively ordinary, language, as ordinary as they can get.
In summary, Bill C-18 both legislates a number of important tax measures already announced by the government and improves the income tax system in many technical respects. As a clear expression of the government's concern for the system's fairness and efficiency, this bill deserves the support of the House.
While I am on my feet, Mr. Speaker, may I move:
That Bill C-18, an act to amend the Income Ihx Act, the Canada Pension Plan, the Cultural Property Export and Import Act, the Income Tax Conventions Interpretation Act, the Thx Court of Canada Act, the Unemployment Insurance Act, the Canada-Newfoundland Atlantic Accord Implementation Act, the Canada Nova Scotia Offshore Petroleum Resources Accord Implementation Act, and certain related acts not to be referred to Legislative Committee Ebut be referred after second reading to the Standing Committee on Finance.


The Acting Speaker (Mr. DeBlois):: The members have heard the motion tabled by the minister. Does the House give unanimous consent?


Some hon. members:: Agreed.


Some hon. members:: No.


The Acting Speaker (Mr. DeBlois):: All those opposed to the motion will please rise.
And fewer than five members having risen:


The Acting Speaker (Mr. DeBlois):: Fewer than five members having risen, the motion is deemed adopted pursuant to Standing Order 73(3)(b).


[Stage Direction]
Motion agreed to.
October 7, 1991
[Stage Direction]
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Mr. John Manley (Ottawa South):: Mr. Speaker, I thank the minister for not explaining in detail, either in French or in English, all the complex clauses of this bill. I believe that this bill shows how complex our system of tax law is and also that our economy and society are becoming more complex all the time.
Later, I will say a few words about the complexity of the tax system, but first of all this afternoon, I want to talk about tax reform in general and to take this opportunity to discuss somewhat the fact that after seven years, this government has created a tax system that is less fair and more complex than the one they found in 1984.

Tax reform is a very complex and complicated matter. As the current Bill C-18 demonstrates, even a bill that contains relatively few controversial matters requires a great deal of paper and many words to explain. This bill runs over 2,000 pages in total, although it is in both languages and I suppose we can find much that few of us in Canada, let alone in the House of Commons, will understand.
Indeed, it is necessary that tax law be complicated. We do deal with a very complex economic system in Canada. There are many aspects of it that needed to be considered in drafting taxation legislation. There is no way to avoid complexity when life itself is complex.
I would like to remind the House of Commons about the purposes behind tax reform when it was first introduced by the government in its white paper on tax reform in 1987. I think it is worth while to review the record of the government on taxation matters in light of the objectives set out by the former Minister of Finance when he introduced his tax reform measures and consider what has happened between 1984 and 1991 in the over-all tax system.
I would like to say that some of the measures of Bill C-18 will be addressed in particular detail by some of my colleagues who are interested in them. In particular, we will be looking at issues related to changes in the method of crediting individuals with disabilities. We will be looking at some of the changes to the international shipping corporation laws. We will be talking about the over-all issue of tax reform and its complexity and, I
hope, to some extent about the northern benefits changes contained in Bill C-18.
In 1987 the former Minister of Finance said that tax reform proposals had been designed to meet five broad objectives. The objectives he talked about were: fairness, competitiveness, simplicity, consistency and reliability.
Recently, at a conference held by the Canadian Economic Association at Queen's University, Patrick Grady of Global Economics Limited presented a paper which took stock of the results of tax reform over the recent years of Conservative government in Canada. Many of his comments are noteworthy when we embark on parliamentary consideration of a bill as long and as complex as Bill C-18.
I would like to take into account some of his comments as I consider the objectives set out for tax reform by the former minister to review how the results of the last seven years compare with those.
First of all, fairness. He said the fairness of the tax system should be increased. The Minister of Finance said: "Higher-income individuals and profitable corporations must carry a larger share of the income tax burden than they currently do." He says: "Individuals in similar economic circumstances should be taxed more equitably than they now are. When they are not, there should be valid reasons for different treatment. The reduction of selective preferences will help to achieve this objective."
I suppose when we talk about fairness, nobody would question the premise that the tax system should be fair. I am reminded of the old line that describes most everyone's ideal tax reform and that is: "Do not tax you, do not tax me, tax the guy behind the tree." Everybody wants to pay less tax, and it is a fairer tax system if they pay less and somebody else pays more. That is one way of looking at, but there are some criteria that we generally consider in deciding whether or not we consider a tax system to be fair. Those are principles of equity and in Canada historically we have accepted that we should first of all strive for a system of what we call vertical equity. In other words, based on a person's ability to pay they should pay more. Where they have less ability to pay they should pay less. This concept has led us to the development of a tax system which contains progressive rates so that as you earn more income, as your ability to pay tax increases, you pay a relatively higher share of your income in taxation.
October 7, 1991

When we look at the results of the years 1984 to 1991, it is not totally clear that that has been the case. What has happened under the years of Tory tax reform is that at the lowest end of the income scale, individuals and families are paying less in tax. That is good. What we find at the top end of the scale is that individuals and families in the highest income categories are also paying relatively less as a percentage of their income. In fact, while we have experienced a massive tax increase between 1984 and 1991, that increase has been focused on those individuals and families in the middle income categories.
According to a study by Mr. Grady of Global Economics: "The equity of the tax system has deteriorated under the Tories. The progressivity of the personal income tax has been reduced with the reduction in top marginal rates and tax rates have been increased sharply on middle income earners".
That is not my conclusion. It is the conclusion of an independent analysis done by Global Economics Ltd. that equity has decreased.
In the context of that, I think it is important to point out that a large number of taxpayers are actually paying more tax in absolute terms as well as in relative terms in 1991. Eighty-six per cent of Canadian families pay more tax in 1991 than they did in 1984, 86 per cent. That I think is reflected in the kind of messages that we hear on a daily basis from our constituents. I do not think that they distinguish particularly between school boards, municipal taxes, provincial taxes, federal taxes, income taxes, sales taxes, excise taxes, user fees and payroll taxes. They are paying them. They are coming out ultimately of the same pocket and the burden of taxation that has increased so much since 1984 is literally crushing the spirit of Canadians.
I want to talk a little bit about the other aspect of equity, horizontal equity as it is called, in other words, the fact that people in similar economic situations should pay the same amount of tax and that those in different ones should pay different amounts. The minister reflected that in his objectives of fairness. I think what strikes me in this area of fairness is the strange things that have happened to the taxation of families in Canada. I indicated a few moments ago that 86 per cent of families in Canada are paying more tax in 1991 than they were in 1984.
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The other thing that has happened though is that as one goes up into the middle income category, one finds that the amount of help that there is for families with children has declined significantly.
Let me explain what I mean. If you have neighbours in similar economic situations in which one family has a child and the other does not, and they have the same family income, let me give the amount of extra income after tax these two families will have. They are side by side, maybe in a duplex. They both have $19,000 a year of annual income. One family has a child and one does not. At the $19,000 of family income, the family with a child will have $4,631 in additional support after tax to help pay the expenses of that child. That is good. You can argue about whether it is enough, but it is significant.
In the major urban areas of Toronto, Vancouver, Montreal and Ottawa, $40,000 is not a huge amount of income. The additional after tax income available to a family with a child at $40,000 is only $846.
At $60,000 of income, the family with a child has an additional $230 to try to defray the costs that are associated with a child. I have three children and $230 does not get you through the month of September. It does not go anywhere near paying the additional cost not just of clothing, not just of essentials, but all of the other costs associated with children.
It is now at the point, and this impacts most heavily on low income families, where not only do you have the cost of food and shelter and clothing, but to be involved in the public school system for a child is an expensive proposition. It is now necessary, despite our public education system, for children to have additional books and materials purchased for them. It is necessary to pay for field trips. It is necessary to pay for involvement in extracurricular activities that used to be just accepted as part of our educational supply.
When you consider the importance of children to the future of Canada, you have to ask yourself whether a system which has so minimized the value of supporting children in a family context is on the right track.
There is a similar problem with the issue of legal marriage. This is a strange one. I consider this to be more of an anomaly than simply bad policy. When you look at what has happened to our tax system over the last number of years, we have reached the point where it actually pays for families for the spouses not to be legally married.

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One of the objectives of tax reform which I may get to is the concept of neutrality. The idea is that in the economy we want to the tax system to be neutral. We do not want people to make bad business judgments because they are driven by tax consequences. That is the concept of neutrality. Let them make the right business judgment.
Our tax system is not neutral on the issue of matrimony, of all things. This study comes from Statistics Canada, a study printed in Canadian Social Trends in the summer of 1991. Thke the example of two people living side by side, each parent earning $25,000. Let us say there are two single parents living side by side earning $25,000 a year with a preschool child. Various expenses will be incurred by them. Let us say there are all kinds of things happening and they decide to live together. The choice is, do they simply move into one apartment together and live in a common law relationship or do they marry and move in together? Surely, Mr. Speaker, you would agree with me that the tax system ought not to have too much to say about that.
There are lots of other considerations and values that ought to go into that question of whether people ought to live together or whether they should marry. The tax system has a lot to say about what they do.
According to the Statistics Canada survey, the benefit in simply living together over marrying for these two people in one year is $3,758 and that does not even take into account the cost of holding a wedding ceremony and a dinner at a local hotel.
I think that is more in a category of anomaly than simply bad policy but it has become, because of its anomalous result, bad policy. It is one that needs a focus of policy makers on that issue. Really, the underlying issue is not so much whether people should marry but the issue is what should be the appropriate unit of taxation. It is a complicated issue, but when we have gone through seven years of tax changes which have included such things as taxing back family allowances, old age security benefits and when we have moved from a system of exemptions to credits, and so on, we have taken what used to be perhaps a minor difference and we
have made it into a very large difference. I would argue in favour of neutrality when it comes to that question.
The next thing the minister talked about back in those golden days of 1987 when he was going to reform the tax system was that the tax system should encourage competitiveness, growth and jobs.
I want to remind the House that the tax reform came in two phases. We had phase 1, income tax reform, which essentially consisted of lowering the top marginal rates, broadening the tax base a bit, trying to prepare people for the 1988 election with some lower tax rates.
Phase 2 was sales tax reform, brought in safely after the election, with the imposition of the GST in January of this year. When you look at this objective of competitiveness, growth and jobs and you think about what has happened as a result of the imposition of the GST, you have to give the government really top marks for what it has accomplished. It has stimulated incredible growth in jobs, in building shopping malls in border cities in the United States.
What has happened here is that in talking about competitiveness, growth and jobs, we have actually had a sharp increase in income tax rates over seven years, despite the lowering of the top marginal rate as a result of phase 1 in tax reform.
Second, we have had the introduction of the goods and services tax. Going back to Mr. Grady's study, he quotes the minister: "As the minister has reminded us on many occasions, lower marginal personal tax rates increase the incentive to work, save and invest. They also encourage initiative and risk taking."
What he then concludes, as I read earlier, is that the system has become rather unfair. He also goes on to say that the marginal personal tax rates that are in effect in 1991 are for most people higher than they were in 1984. As he points out: "14.2 million individuals would be facing a higher federal marginal tax rate in 1991 than they did in 1984; only 4 million would have a lower marginal tax rate".
The average marginal tax rate-and that is the rate of tax you pay at the last dollar that you earn-is higher in all brackets except for the two highest where total income exceeds $100,000 per year, higher in all brackets except the two highest.
October 7, 1991

"The magnitude of the increase in average marginal rates is particularly striking in the $30,000 to $40,000 income range at which the increase is 8.4 per cent and 7.1 per cent, respectively".
This has got to be a very harsh indictment of the results of seven years of controlling taxes, but that is where we came to after those seven years. The very people whom you want to have motivated, busy, active, out creating opportunity and jobs are the people who are facing the highest increase in their tax rates.
On top of that, you have the imposition of the GST. All other criticisms aside, it was brought in at a time when the economy was going through a recession, when the Bank of Canada was pursuing a monetary policy designed to stop inflation in its tracks and when it was known to the government as well as to everyone who took an interest in this that the imposition of the GST would provoke inflation.
The member opposite asks: "How much?" He should know that it is provoking over 1 per cent on an annualized basis, which is a significant addition to the rate. You might argue that if it were not for the recession, the rate of inflation induced by the GST might be higher.
On top of that, still talking about the minister's objective of competitiveness, growth and jobs, we have had a continuing increase, not just at the federal level but including the federal level, in payroll taxes, which is a very heavy burden on small business.
I know there have been those who have written in favour of getting rid of the lower tax rate on small business. I think Professor Brooks, for example, has proposed that the lower rate of tax on small business be done away with.
That lower rate only goes part way in compensating for the relatively heavier burden borne by small business as a result of payroll taxes in general, and recently the increases in the unemployment insurance contributions by employers.
That came at a time in the business cycle, beginning in July of this year, when we may have just been coming into a recovery. That payroll tax was like a wet blanket being dropped on top of that shaky recovery. It adds to the burden every small business owner faces in dealing with expanding employment opportunities within a firm.
Government Orders
The payroll tax, like the unemployment insurance contribution, is not based on profit. It is based on the number of people working for the employer. Whether the firm is profitable or not, the payroll taxes are collected.
Rather than encouraging competitiveness, growth and jobs, I would suggest that the last few years have done quite the opposite in terms of tax reform in Canada.
Next he says: "The tax system should be simpler to understand and comply with"; the old objective of simplicity. Here is this year's contribution to simplicity, Bill C-18, all 2,000 pages of it. That is what we are doing to simplify this, which is my most recent version of the Income Tax Act.
It is now running, including the tax conventions and so on that are attached to it on very thin paper, at about 1,470 pages to which these changes are being made. I would love to take these on an airplane with me, but unfortunately, they will not fit under the seat in front of me.
Simplicity is an illusive goal. Anyone who takes this on has to acknowledge, as I said earlier, that our society is complex. The very fact that the minister drags it out and talks about simplicity as being an objective of tax reform in the context of putting out bills on an annual basis, virtually, that look like this one is laughable beyond belief.
I wish I had brought in with me a booklet I received in my constituency office from the government on plain English for use in government publications. I suspect though, that if we put the Income Tax act into plain English, it might be somewhat more difficult for me to lift up than this version.
His next objective was: "The tax system should be internally consistent and consistent with other government programs". That is a tough one. We have looked at some of the peculiarities of our system. For example, we have this tax-back. Some people call it a clawback on old age security and on family allowances.
There we have programs that operate completely at variance with the tax system. We have a program that says in the case of old age security that we are going to ensure that every person qualifying for old age security has a certain minimum amount which they receive as a right of citizenship. They have paid for it through their

Government Orders
taxes over the years and, in some cases, between 1952 and 1971, they paid for it with a special targeted earmarked tax for their old age security.
In the case of family allowances, we have a system that says children are important. We are going to make sure that people with children have some additional support from the state to help them, regardless of their income level. Everybody with children is contributing to the future of Canada and they should get this help. Those are the social policies.
On the tax side, we have a bizarre system in which if you have income in excess of $50,000, you are going to find those benefits taxed back. There is a lack of consistency in approach there, particularly if we look at the strange situations in which the recipients of the old age security are taxed based on their incomes and likewise with the family allowance. There could be two members of the same family adding up to the same total income and not suffering the tax back implication. It is not based on family income, it is based on individual income. It is a lack of consistency.
Those are changes that have come in since this paper by the former minister was produced.
He says: "The tax system should provide a more reliable and balanced source of revenues to finance essential public services". In terms of reliability and sources you would have to give him a pretty good passing grade on that. He has raised taxes in every category of taxation, save one, and that was the corporate income tax. A strange omission, that one seems to have been reduced in rates but the others were increased. Personal income taxes have gone up significantly, as I previously mentioned. Revenue from payroll taxes has gone up. Revenue from sales and commodity taxes has gone up and the rate of tax on corporate income has gone down.
He says: "The tax system should provide a more reliable source of revenues". In terms of reliability, I think what we have to say is that the reliability depends on the willingness of people to accept the system and to pay it on a self-enforcing basis.
It has been the tradition in Canada that we have a system of self-assessment and self-enforcement. The audit provisions that are pursued by Revenue Canada are ones that rely heavily on the presumption that virtually all Canadians accept willingly the obligation to pay their income tax and I believe Canadians continue to feel that way.
What I fear though, is that in the past years the tax burden has become so onerous and the anger that Canadians feel about what they consider to be a lack of fairness is so great that the system of self-assessment is going to break down.
People in my constituency and I know in other constituencies as well are repeatedly saying to me that they are paying too much and they are getting too little value for what they are paying. That to me is a warning that if we do not get this system working right with a perception that it is fair, we are going to begin to pay the price of the breakdown of the self-assessment system.
There are a number of things that I think the government has done that have provoked a sense of unfairness and there are some things that I think are still there for it to consider, if it will look at them, in trying to make the perception of the system more fair.
One of the things that has contributed to the lack of fairness is the sense that somehow people at the top end get a lot of breaks and people in the middle get to pay all the bills. What has contributed to that? Partly the reduction in rates at the top end. The marginal rate has been reduced at the top brackets. Also, the reality is that there are many things that high income taxpayers can do to reduce or avoid paying income tax that are not really available to those people in the middle categories. It is all they can do to pay their bills as they become due and enjoy a reasonable quality of life.
There are some things that this government introduced that have added to that and I am thinking particularly here of the capital gains exemption. It started out to be $500,000. It was reduced finally to $100,000 except for farms and small businesses. On that $100,000 capital gains exemption that enables taxpayers to not pay tax on their first $100,000 of lifetime capital gains, those gains can be realized on property that is not even Canadian.
The object of that tax exemption was to try to encourage investment and to encourage risk taking, but the exemption, as it applies, is equally applied to things like condominiums in Florida or in Spain and to stocks and bonds that are held in foreign countries. The capital gains exemption applies to all of those. I do not understand what is gained by Canada, even on the theoiy that thfe government proposed it, by an exemption that is so broadly based. I would suggest to the government that it simply eliminate the $100,000 capital gains exemption.

Canadians also wonder when they hear the annual taxation statistics why there are still people in very high income categories who do not pay any tax. If you look at the statistics and try to analyse them, there are are only a few reasons for that. One is that they have suffered losses in previous years or sometimes they have suffered losses in subsequent years and they have applied back in other businesses. A loss is a loss and nobody prefers avoiding tax to paying tax when it means they had to lose money in order to do it. I can accept that one but in the vast majority of other cases you will find that high income Canadians who are in a position to borrow heavily because of other assets that they have are capable of sheltering all of their income from tax with the carrying charges incurred against the loans made.
It has been the case in the past that we have looked at the possibility of limiting the exemption for carrying charges to income earned from sources for which the money was borrowed. I would suggest to the government that if it wants to increase the perception of fairness, it should look at the issue of carrying charges and some method of limiting that deduction so that everybody is paying their fair share of tax.
At the corporate level, year after year we have examples of very profitable corporations that do not pay any tax. That creates a perception on the part of ordinary Canadians that the system is not right, that something simply is not clicking, it is not fair.
What I would suggest to the government on that is that it re-examine the system of deductibility of dividends when they are paid and make sure that all corporations that have extra cash available to pay out in dividends have paid the underlying tax on the profits that they earn. If they are paying them between companies, they pay them tax free if the receiving company owns more than 10 per cent of the shares of the company paying the dividends. If they are paying them to individuals, we give individuals a tax credit on dividends that are paid. That credit is supposed to recognize the fact that the corporation paying the dividend has paid underlying tax on the corporate profits that were earned.
If that is true then it is fine. In some cases however, either because of the ability to write off certain kinds of
assets or because of other special treatment given to corporations, tax may not have been paid.
Consequently, you have to wonder on behalf of the rest of the poor taxpayers that are paying their full share, why is it that a corporation paying money out-obviously it does not still need the money or it would not be paying it out as dividends-should still have their shareholders enjoy the benefit of a dividend tax credit supposedly to compensate for the corporate tax that was already paid when it has not been paid.
These are the things that Canadians are demanding the government look at to ensure that the system is fair. People are willing to accept a heavy burden of taxation. That has been demonstrated by Canadians provided two things happen, first of all that they are satisfied that the system is fair, second that they are satisfied they are getting some value for the money they are paying.
When you think about it, that is not really all that much to ask. I suggest as we work our way through these 1,500 pages of Bill C-18, that we bear in the back of our minds those two questions. Is it fair? Are the folks getting value for their money?


Mr. Speaker:: It being two o'clock, pursuant to Standing Order 30(5), the House will now proceed to Statements by Members pursuant to Standing Order 31.


STATEMENTS PURSUANT TO S. O. 31
Mrs. Louise Feltham (Wild Rose):: Mr. Speaker, when the Public Service strike was in progress, my office received many calls imploring the government to legislate them back to work but insisting that we retain our credibility in the area of fiscal responsibility by adhering to the zero, three, three per cent increase.
Today these same people are expressing displeasure for a system which will allow the public servants in upper management positions to receive a bonus while denying salary increases to a lower income public servant.

This policy was created by the Liberal government in 1981 and does not reflect the stringent fiscal policy and commitment to restraint of our Conservative government. The fact that the criteria in this case was satisfied is not enough. Our government must provide equity and fairness for all. Our upper income public servants now enjoy wages equal to their private sector compatriots. Is it not now time to do away with this outdated system of bonuses?


CROSS-BORDER SHOPPING
Mr. Jim Jordan (Leeds-Grenville):: Mr. Speaker, of all the factors in our economy that contribute to crossborder shopping such as taxes and the goods and services tax in particular, the discrepancy in the price of gasoline between Canada and the United States is no doubt the largest single contributor to the problem.
This is best illustrated if we examine the number of gas stations per capita in the U.S. border towns compared to similar sized communities in Canada where dozens of gas stations have been forced to close due to lost sales.
Since the government is losing money on gas purchased in the U.S. anyway, would it not make sense to drop the 8.5 cents a litre excise tax on gasoline for Canadians in order to recapture lost gasoline sales and at the same time remove the main reason that same day shoppers go to the U.S. in the first place.


WORLD HABITAT DAY
Mr. Dave Worthy (Cariboo-Chilcotin):: Mr. Speaker, the United Nations has declared today, October 7, World Habitat Day.
This year's theme is shelter and living environment. Shelter is a basic necessity. It is widely acknowledged that the ability of citizens to acquire decent, safe and clean housing is an important goal for all societies. Whether it is local or international, good housing is more than shelter. It is also seen as an important contributor toward better health, better education, better employment and ultimately a more productive society.
As one of the best housed nations in the world, Canada has an important role to play, both at home and abroad. In support of this United Nations effort, World Habitat Day, I encourage all Canadians to acknowledge
the significance of proper shelter and a better living environment for all citizens of the world.


DISARMAMENT
John F. Brewin: Mr. Speaker, in the last week we have seen major developments in the area of disarmament. We have seen President Bush's initiatives on unilateral cutbacks in the United States and on Saturday night President Gorbachev made an equally dramatic announcement about cutbacks in the Soviet Union.
Yet we have seen nothing from the Canadian government except a fawning response to President Bush's initiatives. There are a number of very critical things which Canada can do. For example, Canada can today say there will be no more cruise missile testing in this country. We can say there will be no more visits to Canadian ports of vessels carrying nuclear weapons or which refuse to certify that they are not carrying nuclear weapons.
Since the current Secretary of State for External Affairs took office there has been a virtual silence on the idea of a world summit on arms trade. There have been no initiatives about the Arctic or the Pacific. It is time Canada took initiatives-


Mr. Speaker:: I am sorry, the hon. member's time has expired.


CANADA POST
Mr. Guy Saint-Julien (Abitibi):: Mr. Speaker, I just received the following message from letter carriers and postal workers around Val-d'Or, in Abitibi:
"We agreed, in good faith, to accept a mediator suggested by your government, and we even agreed to go back to work. Since the strike, the employer has used disciplinary measures and other tactics against employees as part of its provocation strategy. The mediation process before Justice Allan B. Gold is a one-way street, since Canada Post refuses to negotiate in good faith, hoping that eventually, your government will intervene in its favour with special legislation. We enjoin you to demand that Canada Post negotiate seriously and do so as soon as possible."
October 7, 1991


FERRY SERVICE
Mr. Lawrence MacAulay (Cardigan):: Mr. Speaker, last Friday the Minister of State for Transport said she would not give a permanent commitment to the Wood Islands ferry service. The Wood Islands ferry is a vital link between Prince Edward Island and the mainland that will continue to be needed in the future, whether or not a fixed link is built.
The government says that it will not make any shortterm decisions. That is the same thing this government said about VIA Rail in Prince Edward Island and we know where it is today.
The people of eastern Prince Edward Island will not stand for the government's "use it or lose it" policies. We depend on the Wood Islands ferry to transport our goods to market and it is a vital link for tourism. The government must come clean with the people of eastern Prince Edward Island and make a permanent commitment to the Wood Islands ferry service.


FISHERIES
Mr. Charles A. Langlois (Manicouagan):: Mr. Speaker, the special fisheries support program announced last Friday by the Hon. John Crosbie and the Hon. Bernard Valcourt will bring much needed support to communities on Quebec's Lower North Shore.

We recall that the fishermen and plant workers of the lower north shore communities could not start the fishing season until the end of July because of severe ice conditions in the Gulf of St. Lawrence and off the Labrador coast. Decreases in groundfish catches were so drastic that the majority of fishermen and both men and women plant workers could not obtain the minimum number of weeks of work to maintain their unemployment insurance eligibility.
The special support program for the fisheries and processing industry will enable fishermen and plant workers to work and take training courses while participating in the restructuring process that has already started in the industry on the Lower North Shore.

Both ministers should be commended for this comprehensive program.


NATIONAL FAMILY WEEK
Mr. Guy H. Arseneault (Restigouche-Chaleur):: Mr. Speaker, this is National Family Week and I wish to commend all those who have worked diligently to ensure its success. The family unit is a cornerstone of our society. It is a source of encouragement and support for each member. It is a cradle of the values and ideals which helped shape our nation.

In modern society, the State is asked to play a major role in the development of future generations. We need social programs and tax policies that benefit Canadian families with children. Every Canadian child should have an opportunity to attain its full potential.
Tragically, one Canadian child out of six grows up in poverty. Everyone who supports social justice must show more concern for children who are growing up in such adverse conditions.
Family Service Canada is doing remarkable work by making us aware of the changing needs of families today and by putting pressure on governments to take concrete action to respond to those needs.


AGRICULTURE
Mr. Peter L. McCreath (South Shore):: Mr. Speaker, last Friday witnessed the largest meeting of farmers in the history of Nova Scotia. Over 600 farmers from all over the province gathered at Canning to discuss and

demonstrate their concern that the system of supply management, the basis for Atlantic agriculture, not be bargained away at the GATT negotiating table.
These Nova Scotian farmers unequivocally rejected the concept of tariffication as an acceptable alternative to supply management. As one farmer said, "If tariffication replaces supply management I am out of business, my livelihood lost".
The meeting unanimously passed a resolution reaffirming the support of Nova Scotian farmers for Canada's December, 1990 position at the GATT negotiations and unequivocally indicated that any deviation from that position would be completely unacceptable.
Mr. Speaker, I too stood in support of that motion. I call upon the Prime Minister and the government to give Atlantic farmers a clear statement that the government will hold firm on the issue of supply management and on the need for the preservation and clarification of Article XI of GATT.


Mr. Cid Samson (Timmins-Chapleau):: Mr. Speaker, the Tories' economic policy gets an "F" for failure. Canamax Resources Inc. is shutting down its Bell Creek division gold mine in Timmins, putting approximately 100 people out of work.
Why? Is it the high production cost? No. Is it the low-grade ore? No.
A fixation with trying to battle inflation with high interest rates is pushing our dollar to record high levels. The high dollar is adding to the cost of the mining industry and reducing its competitiveness. At the same time it is getting less income because of the lower price of gold.
The government must reverse policies that are destroying the mining industry and putting thousands of people out of work. These policies have put this country into a recession and will slow any recovery.
Come to the rescue of the mining industry now. Lower the dollar.


STATEMENTS MADE BY FORMER PRIME MINISTER PIERRE ELLIOTT TRUDEAU
Mr. Denis Pronovost (Saint-Maurice):: Mr. Speaker, what a sorry spectacle Pierre Elliott Trudeau has once again made of himself. His statements on the distinct society are unjustified, untrue and malicious.


Some hon. members:: Right on!


Denis Pronovost: What he said further exacerbates relations between Francophones and Anglophones.
Mr. Trudeau's remarks were a golden opportunity for the Bloc Quebecois, Jacques Parizean and Gerald La-rose, who can look shocked and offended to their heart's content.
The man who did everything to kill Meech Lake is no more than a petty advocate of revenge. Now he wants to prevent Canada and the government from achieving a new constitutional agreement that would get our country out of its present impasse, as if the country couldn't get along without him.
We all know that Mr. Trudeau is still the real leader of the Liberal Party of Canada and that he manipulates his successor and his successor's entourage, who should have the courage to denounce him publicly.


Some hon. members:: They don't have the guts!


YOUTH PROGRAMS
Mr. Maurizio Bevilacqua (York North):: Mr. Speaker, this government's record on youth policy is becoming a serious national concern.
At a time when our country is preparing to compete globally, this government continues to clearly demonstrate lack of insight and understanding of how a globally competitive society is achieved.
It is not achieved by having a youth unemployment rate of 17 per cent, by reducing our commitment to post-secondary education, research and development, by having a training strategy which is seriously questioned and doubted by our business community, by lack of
October 7, 1991

concrete action on our 30 per cent high school drop-out rate or our 20 per cent illiteracy rate.
As a nation, we are in desperate need of immediate solutions to these fundamental challenges, all important prerequisites for achieving global competitiveness. In this vital process to the future of our nation, our youth must be full partners. It is our responsibility to lead the way.


PROPERTY RIGHTS
Garth Turner: Mr. Speaker, over the last few days in this Elouse I have tried to address some of the misinformation being spread by those who oppose the idea of putting property rights back in the Canadian Constitution.
This is an historic and important right first enshrined in the Magna Carta of 1215, reinforced by the 1948 UN Declaration of Human Rights, and contained in the 1960 Canadian Bill of Rights.
Today's myth about property rights is that there is no real need for them. This myth was furthered this weekend by an article in The Toronto Star, and I quote:
There is no suggestion that land owners are being exposed to
arbitrary expropriation without compensation. No legislatures are
stomping over property rights. No courts are routinely denying due
process to people seeking to protect their property.
This is untrue and unfounded. There are countless examples on record of people losing their land through expropriation or having the value of their land reduced through zoning and other regulations without just compensation.
This is unfair. Why do we need property rights? Let us ask Karl Marx. "The theory of the Communism", he said, "may be summed up in a single sentence"-


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


SECURITY INTELLIGENCE REVIEW COMMITTEE
Mr. Derek Blackburn (Brant):: Mr. Speaker, on Friday the Security Intelligence Review Committee made its annual report public.
In light of the Persian Gulf war, the Al-Mashat affair and the Oka crisis, one would think it has been a busy year for CSIS. The Canadian Security Intelligence Ser-
Oral Questions
vice has indeed improved since it was created in 1984. However, in its report, the review committee concludes by giving CSIS an absolute clean bill of health. According to the report, every operation undertaken by CSIS and reviewed by the committee was just fine.
In past years the SIRC did not shy away from criticising the operations of the CSIS and the focus of its investigation. Has the review committee lost its bite? Has it even lost the ability for whistle-blowing?
The committee acknowledged that CSIS uses information passed on by the Communications Security Establishment, the ultra-secret listening apparatus of the Canadian government. CSIS cannot obtain such information on its own, but there are no laws that stop the CSE and the committee has failed to warn Canadians of that danger.
Does this government intend to statutorily mandate the CSE and make it fully accountable to Parliament? Will we need another McDonald Commission into the abuses of yet another spy agency before we admit that the threat to Canadians is real?



ORAL QUESTION PERIOD


Hon. Jean Chretien (Leader of the Opposition):: Mr. Speaker, my question is directed to the Acting Prime Minister.
Today the Yugoslavian federal military attacked the Croatian capital of Zagreb. At least two missiles were launched. One just missed the Croatian Parliament and another landed near a 13th century cathedral.
The U.S. consulate in Zagreb has urged all remaining American citizens, including journalists, to leave Croatia.
Can the minister inform this House what is the situation of the Canadians in Croatia today and what kind of instructions have they received from the Canadian Embassy?


Hon. Michael Wilson (Minister of Industry, Science and Technology and Minister for International Trade):: Mr. Speaker, I can say to the Leader of the Opposition that the government is very concerned with the develop-

October 7, 1991
Oral Questions
ment of events in Croatia. We have spoken to our colleagues and people in the European community to ensure that we have full consultation with them. All countries are condemning the breach of the cease-fire. We think it is very important that the parties respect the agreement that was reached last week.
At this point I am not briefed on the specific answer to my colleague's question, but I will get an answer for him as soon as I can.


Joseph Jacques Jean Chrétien: Mr. Speaker, I have a supplementary question for the minister.
As I have already said, the city of Zagreb was bombarded today by the federal army. The European community has already stated that economic sanctions would be imposed, probably as early as this evening.
Therefore, I ask the minister: Does the government intend to impose economic sanctions on Yugoslavia, as the European community intends to do, if a cease-fire is not declared by the end of the day?


Michael Holcombe Wilson: Mr. Speaker, this is certainly an option that is under consideration in consultation with our colleagues in the European community, but it is a question that we have not decided on. We want to follow very closely the progress of events. As I indicated in my previous response, we are very concerned by the developments since the cease-fire agreement.
If this is a way which can bring people to their senses in that country then certainly that is an option that bears close consideration, but at this point no decision has been taken.


Joseph Jacques Jean Chrétien: Mr. Speaker, I have another question for the minister.
It was not long ago that the government seemed very keen on the Conference on Security and Co-operation in Europe, the CSCE, a great institution for peace and security in Europe.
Now that we have a chance to use CSCE, the government seems to be a little bit less enthusiastic. In fact the hon. minister a few minutes ago referred to the community alone while the CSCE conference includes more countries and many of these other countries have quite an interest with some partners within Yugoslavia.
I would like to ask the minister: Why has Canada not asked for an emergency meeting of foreign ministers of the CSCE to deal with the tragic situation in Yugoslavia today?


Michael Holcombe Wilson: Mr. Speaker, the meeting that has just completed in Moscow did not have as part of its mandate the consideration of the matters in Yugoslavia. However, I should advise my hon. friend that later this week, I believe on Thursday, there will be a meeting of officials who will discuss, under the auspices of the CSCE, the situation in Yugoslavia with a view to seeing whether there is some influence that can be brought to bear by that organization on the terrible situation in Yugoslavia.


DAVID MILGAARD
Hon. Lloyd Axworthy (Winnipeg South Centre):: Mr. Speaker, I have a question for the Minister of Justice.
Last September the Prime Minister, in a visit to Winnipeg, met with Mrs. Joyce Milgaard, the mother of David Milgaard, and at the time said that he would make representations to the minister to reopen immediately the David Milgaard case in light of new evidence that had been presented.
It is now going on four weeks since that commitment has been made. I would like to ask the Minister of Justice if she is now in a position to announce the reopening of the David Milgaard case for another trial which he so properly deserves.


Hon. Kim Campbell (Minister of Justice and Attorney General of Canada):: Mr. Speaker, I think, with respect, the hon. member has not accurately conveyed the Prime Minister's comments to Mrs. Milgaard. They were with respect to the fact that he would look into the question of her son's health and his condition at Stony Mountain Penitentiary.
October 7, 1991

He did that immediately, and I am advised that penitentiary officials have discussed a possible transfer with Mr. Milgaard and those discussions are continuing.
I have indicated in this House before that the application is in my office. I am advised by the department that it will be on my desk soon, and I will deal with it as expeditiously as possible.


Lloyd Axworthy: Mr. Speaker, with all indulgence, if the minister would look at the transcript of the Prime Minister's remarks, she would know that the Prime Minister understood that Mr. Milgaard's health is directly related to the long time he has been waiting for this government to reopen his case. I can only urge the Minister of Justice to do it with as quick a dispatch as possible.
I would like to ask a supplementary question of the Solicitor General. At the same time the Prime Minister was again given a request that for the sake of his emotional and physical well-being Mr. Milgaard be granted a transfer to another institution pending the outcome of the justice minister's appraisal and review of his case.
I want to ask the Solicitor General if he is now in a position to announce the acceptance of that request and if Mr. Milgaard will be moved to another institution awaiting the Minister of Justice's decision.


Hon. Doug Lewis (Solicitor General of Canada):: Mr. Speaker, I wish to thank my friend for his interest in this matter. I think at this time it would be appropriate to share with the House a letter from the Prime Minister to Mrs. Milgaard in which he said: "I wish to inform you that the warden of the Stony Mountain institution has spoken to your son about the possibility of a transfer to another institution, but your son was not prepared to discuss it at that time. Please be assured that the prison authorities remain open to consider the possibility of a transfer should your son wish to raise the request again".
I would say to the House that I am not in a position to release any further material in this matter because of Privacy Act considerations, but I want to assure the House that every effort is being made to accommodate Mr. Milgaard.
Oral Questions AGRICULTURE


Mr. Rod Murphy (Churchill):: Mr. Speaker, my question is for the Minister of State for Grains and Oilseeds. In the last 10 days we have seen rallies and demonstrations in a number of Canadian provinces: Ontario, Saskatchewan, Manitoba and Alberta. We know that there are a number of rallies planned for the next couple of weeks.
Since the government has known about this situation for so long, why has the government not announced a program to save the farms and rural communities in Canada? Why has it waited so long?


Hon. Charles Mayer (Minister of Western Economic Diversification and Minister of State (Grains and Oilseeds)):: Mr. Speaker, with respect, I do not believe we have waited so long. We have been on to this problem starting back as early as last spring when we established a third line of defence committee to look at this issue, to identify the shortfall in income. That process has continued.
I attended a meeting of that committee in the first week of September. The Prime Minister met with the same committee last Friday. That committee is going to be making recommendations to us.
I would point out that this process is something that farmers are themselves involved in. Once we see the recommendations coming from the committee then we will be in a position to make a decision.
I reject out of hand the fact that it has taken so long. In fact, it is the other way around. We have seen this coming and we have had farmers working with the government to deal with this very serious issue.


Rodney Edward Murphy: Mr. Speaker, the thousands of people who have been showing up at rallies in each of these provinces indicate that they cannot wait for the government to study and study and consult and consult. It has had many months.
The former Minister of Agriculture who is now the Minister of Finance has had time. Is the government going to make up the shortfall of approximately $1 billion in farm income this year? Is there a commitment from this government to make up that shortfall? The farmers want to know.

Oral Questions


Charles James Mayer: Mr. Speaker, at the meeting on Friday with the farm leaders, the Prime Minister, the Minister of Agriculture, the Minister of Energy, Mines and Resources and myself, the Prime Minister made a commitment to provide some shortfall money in addition to the programs that are already in place.
I would point out that because of this government there are two safety net programs in place which were not there a year ago that will provide, if everyone makes use of the programs, over $1.5 billion in support between now and Christmas and over $1 billion in the first six months of this year.
On top of the commitment that the Prime Minister made on Friday, there is going to be some substantial money available to farmers this fall. We know that that is not the total solution. That is why we are pushing so hard to get a resolution to this international foolishness at the GATT which sees farmers in Canada damaged by a trade war between the Europeans and the Americans.


Rodney Edward Murphy: Mr. Speaker, the minister knows that even if they were to resolve the issue according to their request at the GATT, it would only increase farm income about 10 per cent in this country.
My question for the minister is: When will the government make a commitment to resolve the problem that exists right now? We know that farmers are losing their farms. We know that small businesses in rural Canada are going under. The people involved in those demonstrations want a commitment from the government now. When will that be made?


Charles James Mayer: Mr. Speaker, the Prime Minister, again at the meeting on Friday, asked myself and the Minister of Agriculture report to him by this Friday on what we propose to do in conjunction with working with the Minister of Finance.
I would like to say to the hon. member that if he wants to help farmers, he should talk to the labour people at Thunder Bay to get them back to work. This would help farmers at a very critical time, because what is going on
at Thunder Bay hurts everyone. It hurts the seaway system. It hurts farmers. It hurts everyone.
The hon. member should talk to his labour people and get grain moving at Thunder Bay.


DE HAVIELAND
Mr. Sergio Marchi (York West):: Mr. Speaker, my question is for the Acting Prime Minister.
Last Friday Boeing announced that starting next year 1,300 high-tech jobs at de Havilland, one-quarter of its work force, would be eliminated.
Rather than watching and allowing de Havilland to bleed, why will this government not immediately restore public and international confidence in de Havilland by declaring its unconditional support and partnership in order to protect the jobs, the research and indeed the future of de Havilland and our aerospace industry, regardless of what the private sector does or does not do.


Michael Holcombe Wilson: Mr. Speaker, I am not quite sure what the hon. member has in mind by the code words he is using, but let me be quite specific with him.
We have been working closely with the Province of Ontario and with the Boeing Company. I have also personally spoken to the officials and representatives of Aerospatiale in order to try to develop a very precise list of what the options might be for de Havilland at this time. Those discussions are continuing.
It is unfortunate but the decision of the European Community has put this acquisition by Aerospatiale and Alenia into a very uncertain position. It might well kill the deal completely, in which case the position of de Havilland is a very serious one indeed.
We are looking at various options and if I have anything to report to the House I will do so.


Mr. Jim Peterson (Willowdale):: Mr. Speaker, the European Community launched this action back in June. The government has had four months to work on alternatives. Surely it does not need more studies. Surely it had a contingency plan in its back pocket.
October 7, 1991

Mr. Speaker, when this government gave away de Havilland plus $60 million without a single job guarantee, the then President of the Treasury Board promised Canadians that this deal would, "strengthen de Havilland and provide for secure jobs".
Now Boeing wants out. It is cutting jobs and has threatened a plant closure. Will this government immediately order a public inquiry into its botched privatization and the future of de Havilland.


Michael Holcombe Wilson: Mr. Speaker, I do not know how the hon. member can use those words. The position of de Havilland today is very seriously impacted by the recession and by the serious state of the commuter airline market.
If the hon. member wishes to look around at some of de Havilland's competition, he will find that each one of these companies is suffering from the same problems. In addition, there is the uncertainty as to what would happen with the acquisition proposal by A and A of de Havilland.
My friend says we have known about this since early spring. Yes, we had, but we had been given advice by A and A, who should know best, that it was their best judgment that the commission would approve the deal. In fact, it did not, as we found out last Wednesday.
My hon. friend says we gambled and we are wrong. He is wrong again, because it was the advice we received from Aerospatiale and Alenia which told us that they thought the commission would approve the deal.


Mr. Reginald Belair (Cochrane-Superior):: Mr. Speaker, rny question is for the Minister for International Trade. The U.S. administration has taken unprecedented action against our softwood lumber industry by demanding that our producers post bonds before any countervailing determination has been made. This action is not only harassment but it is contrary to international trade law.
What action is the government prepared to take against this violation of international trade law?
Oral Questions


Michael Holcombe Wilson: Mr. Speaker, I stated very clearly that in this case I do agree with my colleague from Cochrane-Superior. The action on the part of the U.S. government is contrary to international trade law and, as I said previously, we are looking at various options.
At a minimum, we are taking to the GATT our contention that stumpage rights cannot be considered as a subsidy. That is something we will be launching shortly.
What other options we might have is something I am not in a position to say at this point.


Réginald Bélair: Mr. Speaker, I have a supplementary question.
Since 1987, the Canadian softwood lumber industry has been devastated by the export surcharge on lumber and this government's economic policies. Why did the government take so long to take this case to GATT?


Michael Holcombe Wilson: Mr. Speaker, we have acted to deal with the issue, to terminate the memorandum of understanding.
We had determined to terminate the memorandum of understanding because we believed it had served its purpose. The memorandum of understanding was cancelled as of midnight last Thursday night. The Americans have announced their response and it is something we oppose. We have made it very clear to the Americans that we are in opposition to them. They understand the position very clearly.
We will be working with the industry and with the provinces in support of their position in the countervailing action that the U.S. administration has launched. With the full co-operation of the industry, the provinces and the federal government, I am quite confident we are going to succeed.


Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, I would like to pursue this question a little further with the minister.
The minister has suggested this is contrary to GATT. I want to ask the minister if this is not also completely contrary to the specifics of the free trade deal. Is this not

October 7, 1991
Oral Questions
something which proves that as far as President Bush is concerned, the free trade deal is meaningless when powerful interests from the United States start to pressure him and make him forget his professions of friendship with this country. Is this not an action which runs directly counter to the free trade deal?


Michael Holcombe Wilson: Mr. Speaker, I will repeat myself.
I said that this action on the part of the U.S. administration is contrary to international trade law. By our termination of the memorandum of understanding, we will succeed in bringing the trade in softwood lumber under the free trade agreement where it will be subject to the normal dispute settlement mechanisms that have worked well in the past.
In 1986 we did not have the free trade agreement in place and we did not have the dispute settlement mechanism as an ultimate source of appeal. Now we have it and we are going to make use of it in the event that the actions under the countervailing duty investigation are unsatisfactory.


Steven W. Langdon: Mr. Speaker, Canadian lumber producers are already being hurt by the actions taken by the United States.
These actions were taken unilaterally under section 301 of the trade regulations. Is this unilateral action on the part of the United States not directly contrary to the free trade agreement? Does it not mean that it is possible, not in six months but right now, for the government to take action under the trade deal to get these bonds which are supposed to be put in place eliminated and rolled back? Can he not take action right this day?.


Michael Holcombe Wilson: Mr. Speaker, the trade in softwood lumber was not subject to the free trade agreement prior to last Thursday at midnight. By our actions in terminating the memorandum of understanding, we have brought trade in softwood lumber under the free trade agreement.
The United States has taken some action which we disagree with fundamentally, but it is its right under the free trade agreement to take those actions as we could if we were in the same position it is.
What my hon. friend should be complimenting the government for is that we have a dispute settlement mechanism that we did not have in 1986 that can protect us as we go through the process of the trade remedy legislation which the U.S. has in place. We do have protection today that we did not have in 1986.


TREASURY BOARD
Mr. George S. Baker (Gander-Grand Falls):: Mr. Speaker, contrary to what the government said in this House last week, performance bonuses to government appointees and the heads of Crown corporations started in this country in 1987 as a result of the report of an advisory committee appointed by this Prime Minister. At that time he publicly said: "I have no quarrel with paying somebody top dollar, but I also believe in disclosure".
I ask the government: Why then has it for the past three years approved these bonuses to heads of Crown corporations and the like while refusing to release the figures to the people who are footing the bill, the Canadian taxpayer?


Hon. Harvie Andre (Minister of State and Leader of the Government in the House of Commons):: Mr. Speaker, as I explained several times last Friday and as was explained by the President of the Treasury Board prior to that, the total remuneration to Crown corporation agency heads is based on recommendations from an independent committee, the establishment of which was made by the previous government, and I think the same chairman is there today as was there under the previous government.
Part of the pay, up to 10 per cent, between zero and 10 per cent, is by way of performance pay. It has been the policy of the Government of Canada for as long as I can remember-perhaps he can ask his leader whether it was in place when he was President of the Treasury Board- that pay levels of senior public servants in this country

Oral Questions FISHERIES
are given in terms of ranges. This is out of respect for privacy and so on.
That has been the policy of the government and remains the policy of the government, the pay ranges. As I said before and as the President of the Treasury Board said before, the performance pay can be between zero and 10 per cent. For the last fiscal year, that is 1989-90, it represented 4.8 per cent, I believe.


George Baker: Mr. Speaker, the minister is trying to rewrite history. The employees of the Canada Employment centres across Canada got their performance gifts this year. They got mugs and lapel pins. The mugs were made in Taiwan and the lapel pins were stamped "made in the U.S.A." So much for Canadian employment at Canada Employment.
I want to ask the minister of employment if he is aware that a movement has started now-it started in Newfoundland on Friday; it is spreading across the country today-to send back all of those performance gifts, mail back to the minister thousands of mugs and pins.
Will the minister now call on the heads of these Crown corporations and government appointments to forgo their performance gifts, those huge cheques, and accept a mug and a lapel pin instead?


Some hon. members:: Hear, hear.


Harvie Andre: Mr. Speaker, entertaining as usual but also no more enlightening.


Some hon. members:: Oh, oh.


Harvie Andre: The hon. member refuses to accept what is simply the truth, that remuneration for senior officials who are appointed by the government is established based on advice from outside groups. That is a system that has been in place before this government was elected. It was put in by the previous government.
If the hon. member has a better way of doing it, a fairer way of doing it, fairer to the people involved, fairer to the taxpayers of this country, that will ensure that we get the right people in the right positions and they are remunerated properly, let him make that suggestion. I see he forgot to raise his cup when the camera was on him. Perhaps we could have a flashback over there so he can be seen.


Mr. Speaker:: Perhaps we can't.


Mr. Brian Tobin (Humber-St. Barbe-Baie Verte):: Mr. Speaker, my question is for the Minister of Fisheries and Oceans.
For a number of weeks now we on this side of the House have been asking the government for assistance for fishermen and plant workers in Atlantic Canada who have not qualified for unemployment insurance this year. We therefore applaud the announcement by the minister of fisheries on Friday in St. John's of a $39 million assistance program for those fishermen and plant workers who have not received unemployment insurance.


Some hon. members:: Hear, hear.


Brian Vincent Tobin: Having said that, the minister of fisheries will know that there were several thousand fishermen and plant workers who, because of their desperate circumstances, qualified for extremely low unemployment insurance. Many of them will have payments this winter less than $400 a month, as low as $70 a week.
I want to ask the minister-and I thank him for the help for those who did not qualify-what assistance will be forthcoming for those fishermen and plant workers whose income this winter will be less than $400 a month.


Hon. John C. Crosbie (Minister of Fisheries and Oceans and Minister for the Atlantic Canada Opportunities Agency):: Mr. Speaker, I do not often hear the hon. gentleman opposite laud anything, so I would like to thank him for his laudatory comments.
With respect to the latter part of his question, this is a real problem. There will be a number of fishermen-we estimated in excess of 3,000 in Newfoundland and Labrador-who will have low UI benefits because they had very low stamps and very low catches of fish although they qualified for UI. The part of the program that will help them to some extent is the gear-up part of the program. Next spring, March or April, there will be a payout to such fishermen in the affected regions who received lower unemployment insurance benefits than usual. They will receive $800 each to help them gear up for the coming fishing season.

Oral Questions


Brian Vincent Tobin: Mr. Speaker, I want to assure the minister that as long as he keeps his auditory nerve functioning we will keep our laudatory comments coming.
I want to ask him to hear what I am saying. We met with fishermen this weekend on the Baie Verte Peninsula who cannot live on $70 for the rest of the winter.
I am asking the minister whether or not he agrees that an income of $350 a month is too low, whether or not he agrees that people who qualified because of their best effort with low stamps should not be penalized. Therefore, can he tell us: Will a supplementary payment be coming for those fishing families who have low incomes this winter? Will he or the minister of employment meet with the Prime Minister and with the President of the Treasury Board to find the supplementary dollars to ensure that these families, in the words of the Leader of the Opposition, "pass a decent winter"?


John Carnell Crosbie: Mr. Speaker, the Government of Canada has found, I think it is, $59 million altogether including $18 million in compensation for fishermen who were affected by ice and could not fish earlier in the year. That, I think, is a very considerable contribution.
We are also going to have a look, the Minister of Employment and Immigration and I, to see if some better scheme can be found that would deal with these kinds of problems.
In addition to that, there is nothing that stops the government of a province from assisting in any way fishermen or others who need assistance, who participate in the provincial economy.
There is a $2 million contribution from the Government of Newfoundland to help with the employment creation program, but if the province wants to supplement what we are doing further it is certainly welcome to do that.


ALGOMA STEEL
Steve Butland: Mr. Speaker, my question is for the Minister of Industry, Science and Technology.
He will know that the steel industry is at risk in this country, and it is not only Algoma Steel. Foreign imports have gone up to 25 per cent. The American share of our market is 17 per cent, which has tripled since 1988.
The government has seen fit to aid certain ailing industries and this party lauds that. That is excellent. You say yes to some industry but no to steel workers for a $10 million loan guarantee. You say yes to some and to steel workers: "let them eat cake".
When and how are you going to say yes to Algoma Steel?


Mr. Speaker:: I do not want to have to keep interrupting every week, but there is a proper way to address ministers. I know hon. members know what it is and I want them to adhere to it.


Michael Holcombe Wilson: Mr. Speaker, in response to the hon. member's question, let me say that we are working closely with the people at Algoma Steel and all those concerned with the difficulties that Algoma finds itself in today.
Far from ignoring the situation, we are spending a good deal of time in trying to find out what the right solution is for that company, its workers, the shareholders, the bankers-all those people who have an interest in the final results of the Algoma situation. We are working very closely with them.
I think we have indicated our support in the past and with the approach we have taken in order to see a positive resolution to this matter which, as my hon. friend knows, is a very difficult matter. He is absolutely right. It is not just a question of the problems with Algoma Steel, but it is a question of problems in the steel industry as a whole.


Steve Butland: Mr. Speaker, my supplementary question is for the minister.
We are at the eleventh hour. We cannot wait any longer for maybes and rhetoric. The restructuring proposals, no matter what they will be, are coming forward and there will be 1,500, 1,800 or 2,000 people who will not be working at Algoma Steel. That is almost accepted.
I am asking the minister at this time: Will he say yes to assisting the steelworker with older worker adjustment packages? Will he give tax credits to assist in employee buyout which he has endorsed and the Minister of

Finance has endorsed? Yet The Globe and Mail indicates that perhaps the federal government has already said no.
Will he assist in retraining? Will he say yes to any of these now before it is too late?


Michael Holcombe Wilson: Mr. Speaker, we have made it very clear that we believe the best participation we can have in this matter is to deal with the people who are adversely affected by the problems at Algoma Steel. We have made it very clear that employment adjustment measures, whether it is older workers or other workers, whether it is through training, is a very appropriate role for the federal government. We have indicated to all those concerned that this is the position we have taken.
I am sure the hon. member will remember that when we briefed him on this issue that is what he was told at that time.


CANADA LABOUR CODE
Guy St-Julien: Mr. Speaker, my question is to the Minister of Labour.
On June 17,1 mentioned that I had been trying to get paid preventive withdrawal of pregnant workers in federally regulated businesses included in the Canada Labour Code.
The Minister of Labour then replied: "I am currently consulting with groups representing these women and with employers, and I expect that this fall I will be able to table the appropriate legislation."
Can the minister tell us today if this said legislation is being drafted?


Mr. Ken James (Parliamentary Secretary to Minister of Labour):: Mr. Speaker, I would like to advise the hon. member for Abitibi that there is great concern on the part of the federal government re this matter. That is
Oral Questions
why the minister has asked to have consultations with the employee and employer groups.
I would also like him to know, since he first raised this subject, that those consultations are now finalized and that the minister will be reviewing the results of the consultations. He will then be bringing proposals forth to his cabinet colleagues this fall on this veiy important matter.


ALGOMA STEEL
Mr. Maurice Foster (Algoma):: Mr. Speaker, my question is for the Minister of Industry, Science and Technology-
Published reports today indicate that the federal government is refusing to provide tax incentives for an employee buyout plan at Algoma Steel in Sault Ste. Marie this year. The minister knows that the closure of this plant would involve over 6,000 jobs and would practically be a death-knell for the city.
I wonder how the minister can explain why he is refusing these tax incentives to assist the company and the employees save their jobs and save the community.


John Horton McDermid: Mr. Speaker, I read The Globe and Mail this morning too and was somewhat surprised at the headline.
I think the facts should be known to the House. The federal government is supporting Ontario's plan. It will deliver Ontario's tax credit and the entire plan. It has agreed to provide a matching credit for investment fund components.
We match similar provincial tax credits when we satisfy certain criteria. The funds must be invested in small businesses and must hold a diversified portfolio of investments. The employee ownership segment of the Ontario plan does not conform to the national standard. As in similar situations in the past, no matching credit is being provided. Even here the federal government is providing tax relief by not taking the Ontario incentive.


Maurice Brydon Foster: Mr. Speaker, I think that we will want to look at exactly what all that gobbledegook means, whether in fact there are any tax incentives for an industry which is facing the creditors at the end of this month.
I want to ask the Minister of Industry, Science and Technology a question. He knows that the company and

Oral Questions
the union have moved very close in a plan which calls for some $46 million of industrial adjustment for the workers who will be laid off. Is the minister willing to make a commitment today to provide those adjustment funds so that the workers who are losing their jobs will have an opportunity to go on and put their lives back together?


Michael Holcombe Wilson: Mr. Speaker, I cannot add much at this point to the previous question by the member for Sault Ste. Marie.
I have indicated that the Government of Canada has a responsibility and takes that responsibility in assisting those workers who are losing their jobs and are looking for some assistance in the adjustments they have to make, whether it is through training or other means. Once the whole program is put together then we are in a better position to understand exactly what our role should be.


DAVID MILGAARD
Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, my question is for the Minister of Justice.
On September 16 the Prime Minister wrote to Mrs. Milgaard and referring to her son David he said: "Rest assured that your request for him to be transferred to another institution and for the review of the second application for a new trial to be completed quickly have been communicated to the Solicitor General and the Minister of Justice respectively".
That was written on September 16. It seems that our justice system is failing David Milgaard the way it failed Donald Marshall. This is a tragedy, when people want to believe in their justice system.
I want the minister to stop stalling. When is she going to do justice to David Milgaard? When is she going to reopen this matter so that new evidence can be brought forward?


A. Kim Campbell: Mr. Speaker, the hon. member knows that applications under section 690 of the Criminal Code are reviewed very carefully by the Minister of Justice. I am advised by my department that the review
of the second application, the advice and analysis of the evidence that has been put forward in that second application will be on my desk in the near future.
I will deal with it as expeditiously as possible and as fairly as possible.


Russell Gregoire MacLellan: Mr. Speaker, this man has spent 21 years in prison. Surely he can expect fairness from his own government. His own lawyer requested through the access to information system the file on David Milgaard, a 2,000-page file. He received 150 pages, most of which were press clippings and information that was already released.
When is the minister going to be fair? When is the minister going to use her authority to do justice to David Milgaard, release the file to his lawyer and reopen the case so this new evidence can be brought forward?


A. Kim Campbell: Mr. Speaker, with respect, I would say I always have been fair.
The hon. member will know that the remedy sought under section 690 of the Criminal Code is an extraordinary remedy. It is a remedy sought by people who have exhausted the possibilities of the regular criminal appellate system. It provides to the Minister of Justice an opportunity to explore widely to try to determine whether in fact there is a likelihood of a miscarriage of justice.
The first application made by Mr. Milgaard through his counsel was a very complex one and it took some time to complete the investigation. As well it was delayed by the fact that Mr. Milgaard's counsel brought forward on a number of occasions new considerations to be taken into account. That application was reviewed in enormous depth with the help of outside counsel. I am afraid that I was not able to find that the evidence put forward justified the conclusion that there had been a miscarriage of justice.
A new application has been put forward on a smaller range of submissions. Those are being analysed and I will deal with them as expeditiously as possible. The decision will be made on the basis of the evidence that is put before me and the law as it exists now in this country.
I will do that as quickly as I can and consistent with my duty. I have no apologies to make for the speed with

which it is being done. I believe I owe it to the Canadian people to do this with great care and thoroughness.


NATIONAL PARKS
Mr. Ross Harvey (Edmonton East):: Mr. Speaker, I have a question for the Minister of the Environment.
On pages 37, 45 and 58 of the government's Shaping Canada's Future Together document, the government states it is prepared to recognize the exclusive jurisdiction of the provinces in six areas, including tourism, forestry, mining and recreation.
The federal government currently exercises all of these responsibilities together in the national parks. Is the federal government proposing to turn over its responsibility for Canada's national parks to the provinces?


Right Hon. Joe Clark (President of the Queen's Privy Council for Canada and Minister Responsible for Constitutional Affairs):: Mr. Speaker, no.


Ross Harvey: Mr. Speaker, I am delighted to hear it.
It should be borne in mind that there are only three places where the federal government exercises these jurisdictions. That is on military bases, on Indian reservations and in the national parks.
They specifically exempt the first two, but do not specifically exempt the latter, the national parks.
Logging is already occurring in Wood Buffalo Park. The Alberta government allows logging in its provincial parks. Given the government's proposal to apparently turn over these responsibilities to the provinces, should not-


Some hon. members:: Oh, oh.


Ross Harvey: It says in the document that you are going to turn these responsibilities over. Should Canadians not be alarmed that that may open the door for provinces to routinely allow logging in the national parks?
Oral Questions


Mr. Speaker:: I listened with great interest to the question, and of course, it is a matter of importance. It ended up a hypothetical question.
The minister can, of course, deal with it if he wishes.


Charles Joseph Clark: No.


Some hon. members:: Hear, hear.


Hon. Alan Redway (Don Valley East):: Mr. Speaker, my question is, if I can make myself heard, to the Minister for International Trade.
At the same time as the United States is claiming that we are unfairly subsidizing our softwood lumber, eight American states have offices in Toronto and are offering subsidies, including interest-free loans and tax breaks, to Canadian manufacturers if they will only shift their operations to the United States. That is hardly a level playing field.
Will the government immediately launch a trade action against the United States for unfairly subsidizing manufacturers?


Michael Holcombe Wilson: Mr. Speaker, it is not illegal.
It is not counter to trade rules to offer this type of incentive, but if the incentive is found to be a subsidy that is countervailable then, yes, we can take action under our trade remedy laws which still remain in place, as do those in the United States.
If my hon. friend has any specific examples which he feels should be countervailed, then I would be happy to look into those and give a more specific response.


PRESENCE IN GALLERY
Mr. Speaker:: I wish to draw to the attention of the hon. members to the presence in the gallery of Signor Roberto Pocaterra, Minister of Finance of Venezuela.


Some hon. members:: Hear, hear.

Routine Proceedings



ROUTINE PROCEEDINGS


Mr. Albert Cooper (Parliamentary Secretary to Minister of State and Leader of the Government in the House of Commons):: Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government responses to 12 petitions.
[Editor's Note: See today's Votes and Proceedings.]


Mr. Bob Hicks (Scarborough East):: Mr. Speaker, I have the honour to present to the House today, pursuant to Standing Order 34, the seventh report of the Cana-dian-NATO Parliamentary Association.



CONSUMER AND CORPORATE AFFAIRS AND GOVERNMENT OPERATIONS


Mr. John R. Rodriguez (Nickel Belt):: Mr. Speaker, I have the honour to present the first report of the Standing Committee on Consumer and Corporate Affairs and Government Operations in relation to the pre-study of Bill C-22, an act to enact the Wage Claim Payment Act, to amend the Bankruptcy Act and to amend other acts in consequence thereof.
This was the first ever attempt to do a pre-study of a bill that had received first reading in the House. I want to say that it was the unanimous feeling of the committee that this was a very useful exercise. It has promise. We would have hoped for more time to do the kind of in-depth study that would have been required of this kind of a bill. Also, it was the feeling that the parameters of pre-study should be more clearly defined before the matter is sent to committee.
All in all, members had an opportunity to not have their positions fixed in cement like the stars in Hollywood. It was a very useful exercise in the final result and I have the pleasure of tabling it.
[Editor's Note: See today's Votes and Proceedings.]


Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, this might be somewhat unusual, but I just wanted to take a moment of the House to indicate the support of my colleague, the member for Dartmouth, and my own for the process that was used for the pre-study of a bill. This is precedent setting, as the hon. member for Nickel Belt has stated.
I think the process was quite a useful one and members on all sides of the House went into that committee with an open mind. I hope that the House will judge that the report we have brought forward is unique, but that it arrives at a consensus from members of Parliament as opposed to bureaucrats or individuals from elsewhere who sometimes are accused, rightly or wrongly, of dictating what it is that we do in this Parliament.
It was a very useful process and I want to indicate, on behalf of my colleague, the member for Dartmouth, and on my behalf, how pleased we were to have the opportunity to participate in that. Let us now hope that the government listens to our advice.



VICTIMS OF CRIME COMPENSATION ACT


John F. Brewin: for leave to introduce Bill C-310, an act respecting compensation for Canadian victims of crime travelling or posted abroad.


Madam Deputy Speaker:: Pursuant to Standing Order 68(2), the motion is deemed adopted.


John F. Brewin: Mr. Speaker, this is really a re-introduction of a bill which I introduced in the last session of Parliament. It fills, in my submission to Parliament, a gap in the law as it presently is established.
That is, there are provincial programs of compensation for criminal injuries, but there is no similar program at the federal level, either for people who are injured within Canada, in situations coming directly under the federal jurisdiction, such as airplanes, or more even

more important, Canadians overseas who may be injured.
There have been examples of such injuries. My submission to Parliament is going to be that this is a gap which this Parliament should fill and that is what this bill provides.


Madam Deputy Speaker:: Mr. Brewin moves that the bill be now read the first time and printed.
Pursuant to Standing Order 69(1), the motion is deemed adopted.
Bill read the first time and printed.



CUSTOMS ACT


Albert Glen Cooper: Mr. Speaker, this motion addresses some problems with the committee that was struck to look at the Customs Act and is in response to the need for substitutions on those committees.
I move:
That further to the House Order adopted unanimously by the House on September 18, 1991, to establish a special committee to review the provisions and operations of the Customs Act, changes in membership of the committee be effective immediately after a notification signed by the member acting as the chief Whip of any recognized party has been filed with the clerk of the committee; and that the present order be deemed effective retroactively to September 20, 1991.


The Acting Speaker (Mr. DeBlois):: The House has heard the terms of the motion. Is it the pleasure of the House to adopt the motion?


Some hon. members:: Agreed.


[Stage Direction]
Motion agreed to.

Lloyd Axworthy: Mr. Speaker, I wish to present a petition from over 400 resident of the province of Manitoba dealing with what they consider to be a serious miscarriage of justice. They refer specifically to the re-opening of the David Mil-gaard case.
Routine Proceedings
The petition makes special reference to the fact that this is not the first time this kind of serious miscarriage has occurred.
The petitioners humbly pray and call upon Parliament to support Bill C-230, which is a bill asking for an independent counsel to be established in cases in which an appeal is made so that there can be an immediate and expeditious dispatch of thee cases, done in an objective and independent manner.
I hope the House and the government will give due consideration to the important petition from these residents of Manitoba.


Guy St-Julien: Mr. Speaker, I have the honour to table a petition from residents of Joutel, Autier-Nord and Guyenne, in Abitibi. These petitioners ask that Parliament seriously considers, when it will review the Canada Labour Code, the flaws contained in that legislation, and that Parliament recognize the need to include in the Code clauses relating to the paid preventive withdrawal of pregnant women.


Mr. Neil Young (Beaches-Woodbine):: Mr. Speaker, I have two petitions I wish to present today.
The first one is from a group of constituents in my own constituency saying that the Mulroney government has cut CBC funding by $140 million over the next four years, resulting in 1,200 job losses and the closing of 10 regional stations.
The petitioners urge the government to restore proper funding to the CBC so it can fulfil its mandate and role as the heartbeat of Canada.


Neil Young: Mr. Speaker, the second petition is also from a number of people across Canada who state that Bill C-21 has reduced adoptive parents leave from 15 weeks to 10 weeks, while at the same time increased biological parental leave to 25 weeks, 15 weeks maternity plus 10 weeks parental leave. These petitioners call upon Parliament to review Bill C-21 with regard to adoptive parental leave, considering the literature that deals with the adoptive process, the bonding process, needs and rights of adoptive families, proper terminology in adoption and discussion with

October 7, 1991
Routine Proceedings
adoptive families. All parents who have signed this, and others, call on the government to do this.


Ms. Beth Phinney (Hamilton Mountain):: Mr. Speaker, I have three petitions that have been mailed to my office in support of the parents of Nina de Villiers. They are signed by people from my riding of Hamilton Mountain, and from other parts of Hamilton, Burlington, Stoney Creek, Oakville, Toronto. These people are asking that Parliament recognize that crimes of violence against the person are serious and abhorrent to society.
They are asking the government to amend the Criminal Code of Canada, the Bail Reform Act of 1972 and the Parole Act accordingly.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Albert Glen Cooper: Mr. Speaker, Question No. 89 will be answered today.


Mr. Taylor: Has the government prepared or commissioned environmental assessments of (a) the 1991 Federal Budget (b) the role of the Canadian Forces in the Gulf War (c) the proposed free trade agreement between Canada, the United States and Mexico and, if so, in each case, (i) what were the terms of reference for these assessments (ii) when were they prepared (iii) what were their findings (iv) will they be referred to the Standing Committee on the Environment?


Harvie Andre: I am
informed by External Affairs and International Trade Canada and the Departments of Finance and National Defence as follows:
(a)	An environmental assessment of the 1991 federal Budget was not performed. However, it should be understood that the development of guidelines to assess something as complex and diverse as the Budget is complicated by the requirements of Budget confidentiality. Environment Canada is working with the Department of Finance and other departments to develop guidelines to improve the assessment of the environmental implications of new government initiatives. As they evolve, appropriate assessment techniques will be applied to relevant budget initiatives. This work will need to be complemented by assessments and reviews within departments of programs and policies which are their principal responsibilities. The Standing Committee on the Environment can request any Minister to appear before it to explain the environmental implications of any government program or policy.
(b)	No.
(c)	The government has not prepared or formally commissioned an environmental assessment of the proposal free trade agreement between Canada, the United States and Mexico.
The government's June 1990 environmental commitment calls for entrenching in legislation the federal government's obligation to integrate environmental considerations into its project planning and implementation procedures, including public participation in the environmental assessment process.
However, a trade agreement is not a project. Rather it is considered to be a policy initiative subject to internal environmental review. It is difficult to evaluate with confidence the environmental impact of a trade agreement (which is primarily a framework of principles), particularly before the start of detailed negotiations, and when the final parameters of the agreement are unknown. However, in light of the government's June 1990 statement on environmental assessments, the NAFTA, as government policy, will undergo an internal environmental evaluation. The conclusions of this process will be made public.


Albert Glen Cooper: Mr. Speaker, would you be so kind as to call Starred Question No. 40. If this response could be made an order for return, this return would be tabled immediately.
October 7, 1991

Point of Order POINT OF ORDER


Ms. Phinney: From which appropriations does funding for disabled people come
from and what were the amounts of each of the appropriations?
Return tabled.


The Acting Speaker (Mr. DeBlois):: Is it the pleasure of the House that Starred Question No. 40 be deemed to have been made an Order for Return?


Some hon. members:: Agreed.


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.


Ms. Sheila Copps (Hamilton East):: Mr. Speaker, pursuant to Standing Order 52,1 wish to move a motion to adjourn the House for the specific purpose of dealing with the urgent and pressing matter of the unfair action by the United States last week to impose punitive duties against Canadian softwood lumber.

This affects about 1 million workers in the softwood lumber industry. We want the House to adjourn so that an emergency debate can begin today precisely to force the Americain government to withdraw that tax which is unfair and which goes against the spirit of the Free Trade Agreement.


The Acting Speaker (Mr. DeBlois):: The hon. member brings up a very important issue. However, given the rules of the Standing Orders as regards emergency debates, I cannot, unfortunately, entertain his request.

On a point of order the hon. opposition House leader.


Mr. David Dingwall (Cape Breton-East Richmond):: Mr. Speaker, at some date in the veiy near future I would like to raise the matter with the Chair, and with other members of the House, on the procedure as it relates to Standing Order 52 and the granting of emergency debates.
I do not wish to take the time of the House today, Mr. Speaker, but suffice it to say that some of the provisions of Standing Order 52 are, in fact, not really applicable to the proceedings that are taking place today.
I am not commenting on your decision with regard to the request of my colleague, but just to serve notice that the subject matter should have an airing in order to impress upon the Chair that we must move forward in terms of parliamentary reform.
One of the provisions of Standing Order 52 is that you would have to adjourn the proceedings of the House, while, in fact, you do not have to adjourn the proceedings of the House. The time factor would not interfere in any way with the deliberations of the House, with the legislation before the House in any way whatsoever. It would not breach any of the privileges of any member who may have a Private Members' Business motion, or indeed, government legislation which is before the House.
I would like at some future date, through you Mr. Speaker, to come back to the House, and perhaps engage in meaningful debate with the parliamentary secretary to the government House leader, perhaps the government House leader, and other members of the cabinet, to discuss this issue which we believe has to be aired in a full and open way in order to achieve the objectives of the provisions of Standing Order 52.
Too many emergency debates have been asked for and I think if you were to look at the record, the denial of that request has been fairly persistent and extensive over the last number of years. I would hope that the parliamentary secretary would take my remarks as notice, not being as disputatious I might have been at an earlier time.

October 7, 1991
Point of Order


Albert Glen Cooper: Mr. Speaker, there is no doubt that the hon. member raises an important issue that is of concern to members on all sides of the House.
It seems to me the last time this issue was reviewed in great detail, or with any kind of detail actually, was during the McGrath task force. Those of us who were members of that committee spent a lot of time discussing this particular issue.
Certainly I welcome the hon. member's comments. I know that we on this side of the House are prepared to look at that particular question as it relates to reform, as we are also prepared, and are already doing, looking at other reforms like Question Period, the televising of the House, committees, and so on.
I thank the hon. member for raising it, and I assure him of our co-operation in any discussions that he may want to enter into.


Mr. Blaikie:: Mr. Speaker, on a point of order, might I also add that perhaps this is something that the subcommittee of the Standing Committee on House Management, which will be looking at Question Period reform, and hopefully a variety of other things, might add to its list, both in terms of the substance of the grievance or issue raised by the opposition House leader, but also having to do with what might also be called the anachronistic language of the Standing Orders in this respect, the sense that when there is an emergency that the House should somehow adjourn.
Quite the contrary. When the House senses an emergency, it wants to meet longer. Perhaps the reality of the motion ought to be reflected in the language of the motion. I think those kinds of things are what the opposition House leader would also like the committee to consider.
I know that the parliamentary secretary to the government House leader is a member of that committee. We might actually have an opportunity to look at that.


David Charles Dingwall: Mr. Speaker, my colleague to the left has made a very valuable suggestion in terms of pursuing the subject matter, but I was even more daring than he normally is.
I thought that we might engage in that kind of debate in order to involve the active participation, either through listening, or indeed, through pointed questions of you, Sir, the Speaker of this House.
Not only would we want to look at the provisions of Standing Order 52, but also perhaps become a little bit more exhaustive vis-a-vis what we mean by an emergency. There may be a great difference as to what I, or the hon. parliamentary secretary to the government House leader, or my colleague to the left may think is an emergency.
Since we are not in any way exhausting the time of the House or the government from the legislative agenda, I think we might want to revisit this standing order, perhaps on the floor of the House of Commons, and thereafter perhaps to follow that in at the standing committee.
Make no mistake, we are quite serious about our attempt to have additional emergency debate because there are a great number of subject matters which, in themselves, may not be the equivalent of a war on another country, but for the different regions of this country they are extremely important.
One issue which comes to mind, we heard of earlier today during Question Period, is the fisheries in Newfoundland and parts of Atlantic Canada where we have individuals who are-


Albert Glen Cooper: Order, Mr. Speaker.


David Charles Dingwall: I know, I am getting into debate but that is the point that I have been trying to make. In terms of the emergencies, that might not be perceived or accepted by members of the House and the Chair as a national emergency. In that particular province it is an emergency.
I would like to revisit this matter sooner, on the floor of the House, and thereafter follow it up in committee.


Albert Glen Cooper: Mr. Speaker, I agree certainly with the intent of the hon. member to address this as a matter of reform. I have indicated that we have no problem with that.
I do, however, want to state very clearly that for us to enter into such a debate on the floor of the House of Commons would, I think, be very unusual. I think the representations made by the hon. member from the New Democratic Party make much more sense, and that is that the issue be dealt with in the committee. If I could put on my other hat as chairman of that committee, I can say to him that we are quite happy to look at that in
October 7, 1991

relationship to the issues of reform that all of us are discussing and will be discussing in the next little while.


The Acting Speaker (Mr. DeBlois):: The Chair is very favourable to the comments made by the spokesperson for each of the three main parties in the House. In fact, to paraphrase the hon. member for Cape Breton-Richmond East, the Chair takes very seriously the comments that were just made by the hon. members of this House.
That being said, the Chair is but the servant of the House and will of course accept any indication or conclusion that you will provide.



GOVERNMENT ORDERS


Hon. Don Mazankowski (Deputy Prime Minister and Minister of Finance) moved: that Bill C-18, an act to amend the Income Tax Act, the Canada Pension Plan, the Cultural Property Export and Import Act, the Income Tax Conventions Interpretation Act, the Tax Court of Canada Act, the Unemployment Insurance Act, the Canada-Newfoundland Atlantic Accord Implementation Act, the Canada-Nova Scotia Offshore Petroleum Resources Accord Implementation Act and certain related acts, be read the second time and referred to Legislative Committee E.


William Alexander (Bill) Blaikie: Mr. Speaker, Bill C-18 is daunting in appearance. It has the appearance of a telephone book in thickness and contains a great many measures which can only be properly considered in committee. A lot of these measures are housekeeping or technical amendments to the tax system as it stands. In that respect, our over-all approach on this side of the House is to oppose the bill because it is part and parcel of a tax system which over all we oppose.
There are some good things in the bill. There are some measures in the bill which we would want to highlight as things that should have been done some time ago and
Government Orders
which are now finally being done and there are things in the bill which are particularly odious. I hope I might also have time to highlight them.
I wanted first of all to respond to some of the comments made by the member for Ottawa South who was speaking on behalf of the Liberal Party on Bill C-18.
There were some things the hon. member for Ottawa South had to say that I feel very supportive of, and I hope I get a chance to speak to them as well. But the one thing that struck me about what the member for Ottawa South had to say was the way in which he managed to talk about the unfairness of the tax system as it stands, without fessing up to the fact that much of the unfairness in the existing tax system owes its origins to the tax policies of many previous Liberal governments.
I am speaking, of course, Mr. Speaker, of the way in which many tax expenditures, which is the technical name if you like for what people on the street generally call tax loopholes, have their origins in the Liberal government policies of the 1970s and early 1980s. For instance, the member made mention of the dividend tax credit, and I am glad that he did. In that respect at least there has been a change in policy with the elimination of the manufacturing tax that permits the member for Ottawa South to argue for a change in the dividend tax credit without actually going back on Liberal policy. What the hon. member did not go into, as I have said before, was the way in which many of the tax expenditures have their origins in the tax expenditure policies of previous Liberal governments. These expenditures, we believe in this corner of the House, are at the root of the deficit and, therefore, at the root of the willingness on the part of this government to tax the middle class to death in order to help pay that deficit. It is not just the NDP that is saying that, Mr. Speaker, although that would be enough. The fact of the matter is that Statistics Canada in a recent study showed that some 44 per cent of the deficit, I believe, was attributable to tax expenditure policies, that is to say taxes which are not being collected and which could be and should be collected in many ways. Only 6 per cent is attributable to social spending and the other 50 per cent is attributable to the high interest rate policy of this government and the way in which that impacts on the deficit.

Government Orders
What we have here in this bill insofar as it is part of the over-all tax system is a tax system which reflects the values that were so clearly and exuberantly expressed on the night of the first budget of the Progressive Conservative government. I see the hon. member for Beaches- Woodbine there. He will remember that day when the first time that Michael Wilson, the member for Etobicoke Centre, presented a budget, the thing that brought the entire Conservative caucus to its feet in a standing ovation unlike any I have seen here before, was the announcement of the $500,000 lifetime capital gains exemption. It was at that time that I realized the tremendous gulf that existed between me and my constituents, and the government and its supporters-the gulf I might say, Mr. Speaker, that exists in the biblical story between Dives and Lazarus. The great gulf between the rich man Dives and Lazarus the poor man at the gate, which can never be crossed it seems.
I asked myself, Mr. Speaker, who in my constituency was rising in their livingrooms to celebrate this $500,000 lifetime capital gains exemption? The answer, of course, is no one.
This was an exemption that was thought to be the pinnacle of Tory financial policy, which was completely irrelevant to the financial needs of the people in a constituency like Winnipeg-Transcona, with the possible exception maybe of a handful of people who do not make themselves known to me.
The fact of the matter is that we have had financial, fiscal, and taxation policies which have been directed, quite openly and honestly and straightforwardly on the part of the government, to making the rich richer in this country. The Minister of Finance said it himself. He said there are not enough rich people in Canada. Well, he has been true to his own perception of the problem, he has been helping the rich to get richer, as the hon. member for Ottawa South said. He was recounting some very familiar statistics that it is the people in the very top income brackets of the Canadian population who have benefited most from what has been called, in a bastardization of the concept, "tax reform" by this government.
This has not been tax reform in any sense of the word, in any sense of the way in which ordinary Canadians mean it when they call for tax reform. When they call for
tax reform what they mean is that the tax system ought to become more fair, that the tax system ought to require more of those who can afford it and less of those who cannot. Instead, we have a tax system which, admittedly, has provided some breaks to lower income people but at the same time has provided enormous relief to people in the very high income brackets. The people who are feeling it the most, who are really taking it in the teeth, so to speak, are the middle income people.
I think that we are approaching a point in the life of Canadian politics where the middle class is saying: "We can't take it any more." The GST was the final straw. The people who cannot take it any more, and who cannot take it any the most, and this is where I agree with the member for Ottawa South, are in many cases, middle class families with children. The member went into a great deal of detail because he had a lot more time than I will have to go into the discrepancies and inequities which exist within the tax system with respect to people who have children, and how people who are middle class are not receiving the kind of support for raising children that they used to receive as a result of the tax system, as a result of the clawback on family allowances, and as a result of the way in which our school system and various other things are becoming almost user fee places.
I am constantly surprised in my own situation at the things that my kids come back from school and say: "We have to buy this, we have to buy that, we have to buy this, and we have to buy that." I remember in the 1940s, 1950s and 1960s, this was the kind of thing that the school supplied.
I think what is happening in the tax system is that increasingly for middle and upper income people, children are not being regarded as something which all of society has a responsibility to help parents support. Children are being regarded as sort of consumer choices that middle and upper income people are making and it is up to them to support their own consumer choices. If some other couple decides not to have any children and spend their money on winter holidays instead of raising children, well, we live in a free society and we all make choices.
I do not see it that way. I think that there ought to be more support for people who are raising children regardless of the income. That is why we support the family

allowance system and it is why we oppose the clawback and the deindexing of family allowances.
The member also made mention of the way in which the tax system discriminates against marriage. Maybe I have a conflict of interest that I should declare because in my other vocation, as a United Church minister, I am in the habit of marrying people from time to time. I think marriage is a good thing, and I do not see why the tax system should discriminate against marriage in this way. I do not ask it to discriminate in favour of marriage. I simply ask, as the hon. member for Ottawa South asked, that it be neutral, at the very least, with respect to this kind of choice which faces many people.
Just those few words about what the hon. member for Ottawa South had to say. As far as Bill C-18 is concerned, there are as I said a great many things in it which concern us. Some of the things we think are worth highlighting on the positive side are that it gives an exception from the tighter rules on travel and work allowances for visually impaired people, or attendants for mentally and physically impaired people. In fact, some of the best elements of this bill have to do with changes with respect to disabled people, increasing the disability tax credit, for instance.
At the same time there are elements in the bill which give an indication that the government wants to tighten up eligibility for some of these benefits. It is a bit of giving with one hand and the taking with the other, and we would like to explore that more.
Nevertheless, these are some of the positive dimensions of the bill that we have before us. For instance, it closes a loophole on the capital cost allowance for cars. It extends a deduction with respect to encouraging firms to make buildings more accessible for the disabled, again a thing which will help to increase justice for the disabled in this country. It enables tuition payments for courses paid for unemployment insurance to be deducted from UI income.
Now, Mr. Speaker, you will be pleased to know that as a result of this bill it is now officially against the law to deduct the cost of bribing government officials as a cost of doing business.


Some hon. members:: Oh, oh.


William Alexander (Bill) Blaikie: This is a great ethical advancement in the income tax system.
Government Orders
The departmental officials maintain that this was not a widespread problem or anything, but there are some countries in which greasing the wheel is just the way to get things done. This is being put in so it cannot be claimed that its absence made it legal. This is a great step forward.
I will resist the temptation to respond to the heckling of my own colleagues here.
It extends a deduction to those receiving gallantry awards for war service. It extends medical exemptions and credits to incontinence products, mobility-aiding devices, animals which help humans, et cetera, and dwelling modifications. It also provides that no interest will be charged to the taxpayer if they receive an overpayment of their GST credit.
It allows for going back and more easily fixing mistakes and getting refunds. It raises the large corporation tax from .175 per cent to .2 per cent on capital over $10 million. This is a real hard-hitting measure. It goes a long way toward making the corporations pay their fair share. All we can say is that it is a step in the right direction, but they have got a long way to go before they will be asking the large corporations to actually be paying their way.
In the same way that this government gets tough with the corporations, sarcastically speaking, it introduces a new penalty for the large corporation tax late payments which is all of one-quarter of 1 per cent of the total per complete month, compared to roughly 5 per cent of the total amount plus 12 per cent per annum for individuals, another example of the great gap which exists between how this government treats individual Canadians and how it treats its friends in the corporate sector.
The one other good thing, I am told, in the bill is that in the language of the bill, there is exclusive language in the form of always referring to the taxpayer as he or his has been removed and we now have a language of referring to the taxpayer. I am glad to see that the government has finally caught on to the use of inclusive language and sought, when it has the opportunity, to eliminate the use of exclusive language in that way.
Some of the clauses that we would like to highlight because we find them to be ones that we would like to highlight for opposition have to do with loosening the rules on deduction for self-employed home office expenses which allow indefinite carryover of losses when

October 7, 1991
Government Orders
one's home expenses are more than the income earned from self-employment.
We also single out for opposition the fact that money which people receive through the Older Worker Adjustment Program will be taxable like UI income. It seems to me that workers who find themselves in this position as a result of a plant shutdown or whatever and find themselves eligible for the Older Worker Adjustment Program should get some kind of a tax break especially when we consider that capital gains are only taxed at 75 per cent. Why not some kind of exemption for people who find themselves in this very difficult situation?
I am pointing out the difference between the comprehensive way in which the government seeks to tax ordinary Canadians regardless of their circumstance and the breaks which exist on the corporate side.
There is also the question of northern tax benefit changes which the hon. member for Churchill will be speaking to in more detail on our behalf.
As I said before, the disability tax credit has increased from $575 to $700 per year. It is only indexed to inflation above 3 per cent per year. In other words, it is receiving the same kind of treatment that other social programs have. One wonders how the government came to the conclusion that the needs of the disabled only increase by the amount of inflation above 3 per cent if it is serious about actually helping people to meet those needs.
The bill also provides the minister more latitude in checking on whether people are disabled. He puts strict definitions on medical impairments for instance. Revenue Canada has already been cracking down and reassessing people back over the years for this one.
The definition of disabled is to be strictly drawn, but leaves a very wide open crack for people, especially the mentally handicapped to fall into. Whether one can work or keep up a house has been explicitly excluded, for instance, from determining disability. We think this is a matter of great concern.
The hon. member for Beaches-Woodbine has a history of being concerned about the rights of the disabled. He may have something say about this in the course of the debate, but I do not know.
I know my time is running out, but I have just a few more points.
The other thing this does is remove the transfer of education tax credits to relatives if the course is recreational in nature. We have heard a great deal on this from music teachers and particularly people who are in official schools of music. Not only have they been recently hit by the GST, which makes it much more difficult for parents to send their children for these kinds of music lessons, but removing this particular ability of the parents to have the tuition credits transferred to them is another difficulty which these music schools will find themselves in. Perhaps in committee we might be able to persuade the minister to consider something in this respect.
In any event, I see that I have no time left. This will no doubt bring great pleasure to my Liberal colleagues who do not like to hear me go on and on about how the tax system we have, in many respects, owes its unfairness to the Liberal party. I am sorry that I do not have more time to go into that. I know they are not. We will have time in the future.


The Acting Speaker (Mr. DeBlois):: Are there comments or questions? Resuming debate.
Before I recognize another member, it is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for York West- The Airline Industry; the hon. member for Willowdale-Employment; the hon. member for Drummond-Textile and Garment Industries; the hon. member for Vancouver East-Multiculturalism; and the hon. member for Algoma-Agriculture.
I now give the floor to the hon. member for York West. [English]


Sergio Marchi: Mr. Speaker, let me tell my hon. friend from the New Democratic Party that Liberals are prepared to talk about taxes and any other issue and it would be nice if the provincial government of my own province would also engage in that fruitful debate from time to time.
I am pleased to rise in my place to speak on Bill C-18, an act to amend the Income Thx Act and other acts. This legislation was introduced on May 30 by the Minister of

Finance and proposes to change many of the tax provisions imposed on Canadians by this government.
Bill C-18 is an extensive piece of legislation. It will be noted that it encompasses some 400 pages, with over 250 clauses aimed at reforming our tax laws.
As the critic for transportation matters for my caucus and party, I am certainly pleased to leave much of the debate to our financial critics and other colleagues of the House. As the transport critic, I would rather raise and concentrate on one provision, one clause, that relates largely to the shipping industry in this country.
Speaking of shipping, it is no secret that the Canadian shipping industry has been badly hurt by some of the economic policies of the government. That is not to exclude other areas of the transport industry. We have been witness in this Chamber to similar complaints from the trucking industry. When the government deregulated the trucking industry in 1988 and opened up the floodgates for American truckers, we clearly know what the result was, much to the detriment of Canadian truckers and the Canadian trucking industry.
Similarly, we have seen the repeat exercise on the air side in terms of the open skies negotiations, whereby the Americans would want to compete freely and openly in Canada and also abroad and pick up passengers in this country. We will, I think, face the same type of results in the air side that unfortunately our truckers have met with if we allow those negotiations to take place and allow free trade in the sky.
Shipping certainly is not excluded in terms of the transportation infrastructure and the transportation network across the country. Ship owners, Canadian crews, seafarers, shipbuilders and our ports have all reeled from the disinterest of this government to respond to the current economic crisis and to manage the crisis in a much better fashion.
To a great extent the Tory made-in-Canada recession, the elimination of thousands of jobs, the government's disadvantaged tax laws, and excessive user fees, among other matters, have made the Canadian shipping industry uncompetitive through no fault of its own.
Government Orders
As those involved will know, international shipping is largely and exclusively a foreign controlled industry. Canadian shippers have often reflagged their vessels to take advantage of foreign laws, different employment practices and more competitive markets.
The provisions of clause 194 in Bill C-18 which affect our shipping industry aim to put our shippers on a more equal footing with our international competition by allowing shippers with foreign incorporation to not pay taxes on profits generated from exclusively international operations.
Having said that, I think this particular clause is on the right course with respect to righting this wrong. Specifically, the bill would add a new provision to the Income Tax Act to determine that when a corporation's principal operating residence is incorporated outside Canada for the purposes of transporting goods and/or passengers, its profits generated from international shipping opportunities would not be taxable here in Canada and thus would try to correct what has been over a number of years a discouraging variable, if you will, of not having companies register in Canada because the fear was that once you registered in Canada, not only the Canadian routes would be taxed, but all your international shipping business and transactions would become taxable.
What you have happening in Canada is very few foreign firms incorporating in Canada and also driving many of our own shipping companies to reflag in different parts of the world, such as Bermuda. The net effect was that the economic activity and the economic spinoffs were not taking place in Canada, but in other ports across the world.
It should be noted also that under the scope of the legislation departure or destination points on the St. Lawrence or the Great Lakes would not constitute international shipping as a protection to the businesses enjoyed by Canadians currently.
Currently, corporations in Canada pay tax on their world-wide income, as I mentioned moments ago, if they are a principal resident of Canada and if they are incorporated here. Such a fiscal provision has not been conducive to international shipping and many Canadian shipping companies have been hurt by a policy which curtails exclusively international business opportunities.

October 7, 1991
Government Orders
International shipping is truly an operation which depends on world-wide support. Often the crews, the seamen, the financing, the ship's construction, the ownership, cargo, management, chartering and the operations of one ship are from many separate countries.
An example of such internationalism was brought to my attention from an article in Maclean's magazine last year. In it the writer mentioned an example pertaining to an international vessel which carried British Columbian coal to Japanese steel mills. The ship was built in South Korea, financed by an American bank with Asian dollars, registered in Liberia, owned by Panamanians, with shares insured in London. The ship was subsequently chartered in Bermuda, managed in Hong Kong with staff from India and crewed by British officers and Filipino seamen.
That illustrates the complexities which have become the reality in this particular industry. As a shipping nation Canada must become competitive with the other world giants. Regrettably to date the policies of this government have inhibited the opportunities of our international shipping companies, the Canadian crews and our Canadian shipbuilders. For instance, when we talked about the United States of America, they were very ready to open up the trucking industry and push for it, and we gave in. They were very willing to open up the air market, and we are on the verge of allowing them to do that. When it came to shipping, where our vessels in fact can compete head to head with the Americans, they hide behind the Jones Act and refuse to talk about the shipping industry.
That is an example of the fallacy of the argument that this government has pursued, that where we are strong, and where we can compete, we are very hesitant to open up that market, yet where we go into it no holds barred, such as the trucking and the air side, because economies of scales dictate, we are getting hurt as a result.
In 1988, according to Statistics Canada, Canadian international shipping reach 250 million tonnes. Evidently, we are a trading nation, and a shipping nation, but under this government we have not become a competitive nation in this regard.
Allowing, therefore, Canadian shipping companies to take advantage of the international shipping opportunities I think is a pursuit that we ought to pursue as a
House and as a country. Canadian shipping companies have long understood that they are willing to pay their fair share of the tax burden in Canada for their operations domestically. Even the Seafarers' International Union can see that the provisions to exempt exclusive foreign operations is a step in the right direction.
On the one extreme, I think the economic opportunities certainly can be fulfilled. For example, an umbrella organization, an advisory council called the Asia-Pacific Initiative, has recently lobbied the government and other members of Parliament with the belief that such an amendment in this bill would in fact increase the opportunities and the economic spin-offs. For instance, they have quoted that in the Vancouver area alone, if we were to set up and establish an international shipping corporation, it would create as a result 1,600 new jobs over a three year period. As well, it would infuse the local regional economy with $1 billion, and $180 million in purchases of local goods and services.
They feel that there would be a fleet of some 200 ships that would be owned, managed and controlled out of Canada's Pacific coastal waters, rather than the current 12 which are currently in production. I think we in fact can obtain and incur a number of economic spin-offs that are now going to other countries because of the tax regime that we have in place in Canada.
At the same time, however, a number of questions should be answered by the Minister of Finance before the debate concludes. Clearly the opportune moment is not only on second reading, as we are engaging in now, but clearly to seek some clarification and answers at the committee stage by my hon. colleagues who sit on the finance committee.
First, I would like to raise and question the beneficial impact of the proposed legislation as it pertains to the particular shipping clause in Bill C-18 on the employment of Canadian crews. Will, for example, the provisions of clause 194 mean lost jobs for Canadian seafarers? Will this legislation employ thousands of foreign ship workers and displace those Canadians trying to earn a living, and an income, on Canadian ships? What will happen to the opportunities abroad for our Canadian crews and will some of the international shipping lines also engage in more local competition with existing Canadian firms?
October 7, 1991

Insofar as some of those questions go, Mr. Andrew Boyle, Secretary-Treasurer of the Seafarers' International Union of Canada, wrote a letter on April 3 of this year to the hon. Minister of Finance to try to clarify some of these similar points. I would like to quote a paragraph from his letter which I think touches on the problem at hand. He states: "While it is a step in the right direction to put Canadian marine interests on an equal footing with their foreign competitors, any net benefit that would arise by this amendment would be inconsequential versus the thousands of job losses that have and will result from the government-encouraged reflagging of Canadian ships."
He goes on to say: "With thousands of Canadians depending on the marine industry for their livelihood, and in light of the federal government's continued marine policies that discriminate against Canadians and enhance opportunities of growth for Canadian multinationals and foreign shipping fleets, and the thousands of jobs that go with them, we hereby respectfully request that you review the attached proposal concerning Canadian seafarers working on board ship and trading internationally."
I think the Seafarers' International Union has certainly been a large voice, an important voice, and a realistic voice when it comes to the shipping industry. It would be my hope that the committee at committee stage would take a hard look at some of the concerns that not only he but other members of the shipping industry have raised in response to Bill C-18.
I hope that these concerns as well as others that have been mentioned by my hon. colleague, the hon. member for Ottawa South, will be listened to. I know that certainly my colleague from Hamilton Mountain will be talking about other concerns as they relate to other constituencies.
I would love to get into the details of the other facets of the shipping industry, but I am going to refrain from doing so. I know that Bill C-33, a shipping bill, will be coming up for debate in the House of Commons in a matter of days, and I will try to save some of the larger general issues for the debate that will ensue on Bill C-33.
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What I had wanted to do this afternoon in a short span of time is try to raise this one particular clause of many in Bill C-18 that relates to the shipping industry. I think it provides both an opportunity in terms of amending our laws to bring greater economic activity to our Canadian ports, to our shipping industry, and also to realize some of the other options and multiplier effects that can bring greater economic wealth at a time when this country so desperately needs it.
At the same time we are going to engage in seizing an economic opportunity, I think we have to be fully cognizant and sensitive to some of the concerns that have been raised by the Seafarers' because in our rush and in our pursuit perhaps to change and amend our laws, we also may be watching and incurring a down side in other areas.
Certainly protection of jobs by the Canadian Seafarers' and Canadians engaged right now is obviously very high on the national agenda, as so it should be. I believe if we are sensible and if we are cognizant of those concerns we can realize the economic benefit of amending our tax laws and at the same time protect and encourage our Canadian jobs and Canadian crews to ensure that our shipping industry is put once again on a stronger foundation so that it may compete with the world's best.


Elizabeth  (Beth) Phinney: Mr. Speaker, according to the government, its current strategy for the disabled consists of two main elements.
First, the income tax amendments contained in the legislation that we are debating today, Bill C-18. Second, the national strategy for disabled persons announced by the Prime Minister in Winnipeg a few weeks ago.
If those were in fact the principle elements of the government's strategy for persons with disability, I would be prepared to stand in the House of Commons and commend the government for taking some reasonable first steps in assisting Canada's disabled citizens.
The sad fact is, however, that the government's overall strategy for disabled persons is not deserving of praise. It is deserving of manifest condemnation.
Conservative members of Parliament point with pride to amendments in Bill C-18 and say: "We are giving disabled persons $65 million". Those same Conservatives seem to forget that one week ago, they voted for

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Bill C-32, which will remove more than $2 billion from the Canada Assistance Plan payments.
They voted for a measure which will cut home care for disabled persons, which will cut health care for disabled persons, which will cut rehabilitation programs for disabled persons, which will cut programs for independent living for disabled persons and which will cut employment service for disabled persons.
Conservative members of Parliament also point with pride to the Prime Minister's announcement in Winnipeg of $31 million in programs for disabled persons. These same Conservatives seem to forget that a year ago they voted for Bill C-69 which slashed social service funding by billions of dollars, which slashed establishment programs financing by billions of dollars. These same Conservatives seem to forget that they voted to cut the Canada Jobs Strategy fund by $100 million, that they voted to cut social housing by $411 million, that they voted to reduce cash transfers to the provinces for medicare. The Conservative government has cut social programs by billions upon billions of dollars.
Those programs are the very ones which disabled citizens rely upon to help them get proper medical care, to help them receive training, to help them obtain proper accommodation, to help them get out of poverty, to help them live in with a maximum degree of dignity and a maximum degree of freedom.
The government has undermined all of the major programs which disabled Canadians need in order to succeed. In return the government now offers disabled Canadians the $65 million of tax changes contained in Bill C-18 and the $31 million a year more in benefits promised by the Prime Minister.
When one considers there are 3.3 million disabled Canadians, then one will see that the changes offered in Bill C-18 work out to an average of less than $20 per year for every disabled Canadian. That is less than $1.60 a month, about a nickel a day.
Using the same simple arithmetic, the Prime Minister's promise of new programs works out to 90 cents a month, less than 3 cents a day for every disabled Canadian.


An hon. member:: Shame.


Elizabeth  (Beth) Phinney: In short, the government has acted to decimate the health, educational, rehabilitation, housing and social assistance services which are critical to disabled Canadians and in exchange for committing that outrage the government is offering every disabled Canadian tax breaks and new services which work out to 8 cents a day for each one of them.
That, Mr. Speaker, is a national disgrace.
In his budget which led to the legislation we are discussing in the House of Commons today, the Minister of Finance had the nerve to say this government has done more than any other to improve opportunities and to enable Canadians with disabilities to participate more fully and more fairly in the work place, in their communities and at home.
Contrast those words of the Minister of Finance with the words used by the Canadian Cerebral Palsy Association when commenting on the government's legislation to cut back Canada Assistance Plan funding: "The extraordinary suffering which it imposes on poor and disabled Canadians cannot be justified."
There are 552,000 visually impaired Canadians. That means that even with glasses those Canadians have difficulty reading normal print. There are 46,625 legally blind Canadians. These Canadians, our fellow citizens, need the programs which this Conservative government has cut back. Forty-four per cent of Canadians with a disability have eight or fewer years of schooling. These disabled Canadians need more help, not less.
As appalling as those numbers are, they are not nearly as appalling, not nearly as distressing as some other numbers I would like to put on the record.
According to the most recent statistics officially known as the Health and Activity Limitations Survey, these are the number of disabled Canadians living in poverty:
195,000	Canadians with hearing impairment live in poverty, 225,000 Canadians with mental disabilities live in poverty, 134,000 Canadians with visual impairment live in poverty, 493,000 Canadians with mobility impairment live in poverty, 407,000 Canadians with agility impairment live in poverty.
Let me point out that agility impairment is a technical way of saying limited ability to dress or undress, get in and out of bed, cut your toenails or use your fingers.
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I ask you, in 1991 in Canada what are 407,000 Canadians with agility impairment doing living in poverty? What are one-third of disabled Canadians between the ages of 15 and 24 doing living in poverty? What are 29.5 per cent of disabled women doing living in poverty?
Massive issues are confronting all of us in providing proper and fair legislation for Canadians with disabilities. There are the issues of financial security, employment opportunities and employment equity, independent and community living, promotion of disabled rights and the prevention of disabilities.
I do not expect Bill C-18 to solve all the problems but I do expect the government to be honest. This legislation which the government hails as a major step forward in the tax treatment of disabled Canadians is, in fact, a mere drop in the bucket, and it is a mere drop in the bucket which has just been emptied by this government. Whatever measures are contained in this bill come nowhere close to compensating disabled Canadians for the losses they are suffering from government cutbacks in other legislation.
As my colleague the hon. member for Ottawa South has already indicated, we in the Official Opposition are prepared to see this bill proceed to a legislative committee in fairly short order for detailed study. I appreciate that the legislative committee will have its work cut out for it, and I would not presume to suggest to the committee every possible area of the bill it may wish to examine. There are, however, some thoughts which I hope the legislative committee will keep in mind when studying those aspects of Bill C-18 which affect Canadians with disabilities.
Clause 90 of the bill sets out the government's proposal for disability tax credit. I hope the committee will realize that nearly three million disabled Canadians will receive no benefit from the disability tax credit. This is the largest specific budgetary item offered to disabled Canadians, and yet 90 per cent of them are ineligible to claim it. I hope the committee will keep that in mind when suggesting improvements to the bill.
Clause 91 of the bill will put into the Income Tax Act specific legal definitions for those who are eligible to receive the disability tax credit. At present those definitions are handled by regulation. I would hope that the
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committee will consider whether it is wise to make this change from regulation to statute. Do we run the risk of excluding certain people from receiving the credit? Is the certainty of a statute better than the flexibility of regulations?
Committee members will also want to allay the concerns of some disability rights advocates as to whether the disability tax credit and the medical expenses tax credit are complementary. Does the legislation guarantee with absolute certainty that disabled Canadians can claim one benefit without risk of losing the other?
I would hope that with respect to the medical expenses tax credit that the legislative committee will revisit the decision to limit tax assistance for part-time attendant care expenses to expenses incurred in respect of an attendant who is not a relative of a disabled person. Is there a sound reason for this limitation? Does this limitation not run the risk of discriminating against disabled Canadians living in rural or isolated areas where the only person who could possibly serve as an attendant might well be a relative?
Clause 15 of the bill deals with deductibility of business expenses incurred in modifying premises to accommodate disabled persons. In a technical vein, we in the opposition are concerned that this provision appears narrowly defined to limit the deduction to businesses providing greater access only for those with mobility impairment. Does this rule out a deduction for such innovations as talking elevators or visual fire alarms? If so, we hope the bill will be amended.
In a broader vein, it is worth while to note that the government has failed to place a price tag on this provision of the bill. Is that because the government realizes that this measure is simply not enough of an incentive to businesses to modify their premises? Is there a smarter way, a more effective way, of encouraging businesses to modify their premises to provide access for disabled persons? I hope the committee will consider that.
There are then a number of technical issues which must be considered with regard to the impact of this bill upon disabled Canadians. But I want to be clear; it is not this bill per se which troubled me, indeed within its own narrow context this bill contains certain proposals which will prove of some value to some disabled Canadians.

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What troubles me is that the government believes this bill addresses in a serious manner the range of problems facing disabled Canadians. What troubles me more is that other actions by the government negate many, many times over any of the positive benefits which this bill may provide.
As my party's spokesman for disabled persons, I was pleased to be able to arrange a series of hearings across Canada this summer with disabled individuals and with groups representing disabled persons. I want to thank my many colleagues in the Liberal caucus who took part in these meetings. We gleaned a large number of excellent suggestions. We heard from a host of people who have never previously had an opportunity to present their ideas to members of Parliament. We will use these ideas in the months ahead as we press for a fairer deal for disabled Canadians.
I only wish that every member of Parliament on the government side had the same opportunity because I am certain that they would reverse the unfair and unwise strategy which they have undertaken. They would see the foolishness in cutting back on health care for disabled persons. They would see the foolishness in cutting back on housing for disabled persons. They would see the foolishness in cutting back on rehabilitation services for disabled Canadians. They would see the foolishness in cutting back on training programs for disabled persons. They would see the foolishness in cutting back on job programs for disabled persons.
All that individual Canadians with disabilities are asking for is the same as the rest of us want. All that individual Canadians with disabilities are asking for is the opportunity to reach their maximum potential. Surely, as a society, that is what we want. Surely, in 1991, it is not too much for any Canadian to ask. I urge the government, I plead with the government, to give Canadians with disabilities that chance.


Mr. Mike Breaugh (Oshawa):: Mr. Speaker, I want to participate in this debate because this is an important issue for Canadians. I cannot think of anything that is more important to most Canadians than income tax. I think in most kitchens and places where people gather this is the kind of matter they are talking about, perhaps more than the Constitution, perhaps more even than the
popularity of the current Prime Minister. Every day now, people are getting concerned about taxes of different kinds.
I cannot think of a matter that requires more attention from my staff and myself as we try to respond to telephone calls and letters. People are becoming attuned to the tax system. People are asking me interesting questions about income tax, the goods and services tax, the provincial sales taxes, when they pay them and when they do not pay them, and they are beginning to understand some of the complexities of it all. They are beginning to understand how to buy muffins so that no tax is paid on them. They are beginning to go into stores and argue that maybe the banner in the store that says: "We absorb the GST", does not really do any good when they pay the provincial sales tax on top of the price of the goods and a so-called absorbed GST. People are beginning to have some sense of the nuances.
One of the things that disturbs me about this bill is that it is basically a continuation and an expansion of the nuances of the whole income tax system.
I think we should start with the name of the bill because I would defy any of the Ministers of the Crown and any of the half dozen or so members who are here this afternoon to be able to just kind of flip this one off your lips. It is just not possible to do that. Here is the size of the bill. Most towns in Canada do not have a phone book this size and this is not the whole package, this is a partial package. This is the beginning of the latest round of shuffling of the deck.
I think that Canadians, as a group, have a legitimate beef when they say this to people like me. They want to know why, when they sign a contract with the Canadian Tire store, with Woolco, with K-Mart and with any other business with whom they might come in contact, the laws of Canada, Ontario and most of our provinces say that when you draw up a sales agreement, the consumer has some rights and one of the rights is the very simple right of being able to understand what they are being charged and what the process is. If somebody came into a member's office and said: "Listen, I got this bill in the mail and it says I signed a contract. I tried to read this thing, but I do not understand it. Do I have to get a lawyer to interpret this contract?"

Most of us would say well, wait a minute, there is probably a law somewhere on the books provincially or federally which says the consumer has a right to a reasonable amount of knowledge and the obligation is on people in the private sector to explain in reasonable language the service they are providing. And so the day, supposedly, of being able to write up a contract that no one can understand except your lawyer and thereby disabusing the public in some way is long gone.
I defy anybody, any ordinary Canadian, to pick up an income tax form and tell me what the hell it is all about. It cannot be done. I am one of those who was pleased last year when a short form was put out, a short form that was intended to allow people to fill out their income tax a little faster and be a little more convenient for the public.
Well I got the short form. I have been reading short forms like this for about 30 years. I did not understand it. We had to have family conferences about what this short form meant. When we compared the short form to the longer form, we found out in our family that in order to get to use this shorter form, we had to forgo several privileges that had been previously extended to us in the income tax system.
Maybe we should put a stamp on the outside of the short form that says you can use this form, but it is going to cost you money. If you want to use the short form you have to pay more income tax this year. Danger. Warning. Just like on a pack of cigarettes. If you fill out this form it is going to be dangerous to your pocketbook. That would be fair for the consumer, but it did not say that. Instead it purported to be something that would simplify paying your taxes to the Government of Canada.
Reading through this bill is a challenge which I doubt most Canadians will take. As a matter of fact, I doubt that most members of this House will read it either. But if you read this bill, it is a confusing array of reality. It is kind of a bureaucrat's portrayal of what is going on here.
I want to read into the record just one section because I think some of this is pretty interesting. Subsection 28. Follow this if you can, and determine for me, Mr. Speaker, whether it is English, French or something else.
Subsection 10 is applicable after June 17, 1987 except that that
portion of the definition small business corporation in subsection
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248(1) of the said act, preceding paragraph (a) thereof as enacted by subsection 10 shall, after June 17, 1987 and before September 14, 1988 be read as follows:


An hon. member:: Would you repeat that?


Michael James Breaugh: What does it mean? In which of our official languages was that written? Is it conceivable that the Canadian public could understand that? I know that someone will explain to a poor soul like me that this is not meant to be read by the public, it is meant to be read by lawyers, it is meant to be read by tax accountants, it is meant to be read by bureaucrats.
Most of us who have been members for a little while can tell some little anecdote about someone who came to their office last week and you tried to explain, as I have done on several occasions now, why it is that the Government of Canada is suggesting to people that he or she really does not want to be married. You want to be divorced because if you get divorced, you fall into this definition of this regulation in this act, and therefore there is a financial advantage to you.
Surely that is not our business, and yet that is the way this bill is written, and that is the way most acts that have to do with income tax are written. It is the definition.
Try to explain to somebody who is trying to earn a living as a commercial fisherman why it is so difficult for them, and yet so attractive for someone who wants to set up a charter fishing company as a tax loss. That is a confusing thing to try to do, and it is a hurtful thing to try to do. Surely that was not the intention of the Income Tkx Act in the first instance.
I am constantly reminded that income tax was supposedly a temporary tax. Hardly. If you go through the provisions that are in this bill, one almost despairs that there is any sense of fairness left in the approach to it all. I understand, as somebody who has been in politics for a little while, that the income tax provisions in a very broad sense are used as the levers of a government to encourage some things to happen, to discourage other things. Perhaps what needs to be done is at some point in time you need to take all of those incentives and kind of hive them off in some other way, because caught in the middle of this is the ordinary person who has the pay cheque. They are the poor, unfortunate souls who are the victims of this process. They are the ones that cannot afford to play the game, and so they do not have a great

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many investments. They do not have any money left in their take home pay to do any investing.
They are the victims in the sense that they are dependent on other people to interpret simple tax forms so they can fulfil their obligations under the law. An interesting test would be, and I cannot think of a similar circumstance, to see how fair it would be if there were other laws that people just simply could not interpret, could not function on the signs of the law.
In the Highway Traffic Act, for example, if all the signs were posted in the jargon that income tax laws are written in, it would be interesting to see what would happen as everybody went up to the stop sign, ran out and had to get a lawyer to interpret whether the sign said stop or go, whether the light was green or red, to seek professional advice to follow the letter of the law. We all say that is nuts. In effect, that is exactly what this approach to income tax causes all Canadians to do.
I want to get back to something I said a little earlier about the bitterness out there about the process. I am not sure that Canadians ever want to understand this bill or the income tax process entirely. Most of them do not care. Quite frankly, that is not why they are living their lives. That is not the purpose that motivates them every day. It is something that is now beginning to impede them and they are beginning to become increasingly aware that they are victims in this process, that this is not designed to be a fair process. This is a process which mitigates against them and their families and prevents them from accomplishing very much in economic terms during their working lifetimes. They are now beginning to understand that at the end of their working lifetimes, it continues to work against them, it hits them when they retire and it hurts them where it hurts the most, in their pocketbooks. When they try to provide for themselves and their families, they know they are working in an income tax system that is written against their best interests.
It is also true that it is written in the best interests of a veiy small percentage of the population, those who have the ability to compete in this kind of a field, those who have the ability to hire the lawyers and use the tax accountants and to use them well and to use them every single day.
Most people I know who are in business now would probably count their tax advisers among the most important people in their whole business organization, not the people who actually make things, not the people who actually dream up things, not the people who are productive. The people who are critical to the operation very often turn out to be their tax advisers. That is the critical point on whether somebody can stay in business. That is the critical point on whether a product line can expand. Was that the intention? I do not think it was. I think that a long time ago we had a very different concept of what an income tax process was all about.
The bitterness in Canadian people is beginning to manifest itself in some rather unfortunate ways, and I do not think anybody would deny this. More and more people I know are consciously working to find a way out of the whole income tax process entirely.
This summer at my home in Oshawa, I had a string of people banging on my door offering me one price if I wanted to pay by cheque or by credit card, and quite a different price if I wanted to pay by cash. There was a little wink and a nudge attached to that. There was no doubt in my mind that what was going on here is that the guy who wanted to coat my driveway with some kind of sealant had figured it out to the extent that if there were paperwork involved, there was income tax involved. If the paperwork involved me putting some green money into his hand, there was no income tax involved and from his personal perspective that was better than running a legitimate business that might be taxed at some point in time.
I think Canadian people are beginning to sense that the system is wrong. It is not a fair system. It is not one which tries to differentiate between the rich and poor, except that the rich have an ability to utilize the system better than the poor. Caught in the middle are all those people who work for a living, all those who take home a pay cheque.
We had a little debate in here this morning. It was unfortunate, because I thought it was a good idea for a Private Members' Bill to say to seniors: "Here is an answer for you. It may be to your advantage to pay your income tax once a year, rather than quarterly". The government had no time for this kind of concern.
There are a lot of people who are now just beginning to think: "Wait a minute. If somebody else on my block can avoid paying income tax, how did they do that". Maybe if I had an ability to hang on to my tax money for most of the year instead of giving it to the government
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earlier on in the year I could use my money to pay my debts instead of giving it to the federal government.
They are beginning to understand simple things like this: So what if there is a tax credit involved? So what if there is some kind of a rebate involved? First I have to pay the tax and then wait six months, eight months, nine months, twelve months, for some government agency to send me out a cheque. They are beginning to figure out that there is a disadvantage in that for them, that the cheque never seems to quite match their original expenditure and even if it does, they have to give somebody the money for a year and then wait to get it back.
That is not a fair system. The problem with all of this, aside from just the wrong-headedness of it all, is that this is an income tax system which cannot work in this country. I have heard other members say this before me so it is not a revelation and it is not a view which I alone hold. This is a tax system which is based on the simple notion that it is fair enough that the people will pay without having to do a whole lot of auditing or chasing after people. They will see it as a fair system, they will see it essentially as one in which they are paying their fair share. The moment people see it as something other than that, if they see it as a system which cheats them, they are going to try to cheat the system. They are going to tiy to cheat back. One can hardly blame them for that because they see examples of it all around them.
They see corporations which operate within the letter of the law, one should not be accusing the corporations of breaking laws here, with the advantage of having a resource of tax advisers who tell them how to work that law, who tell them how to delay the payment of taxes, who tell them how to avoid the payment of taxes, who tell them how to borrow money so they can write it down, and who tell them what to write off and what to not and to what extent.
When ordinary citizens take a look at that, they say "wait a minute, maybe I had better find some of this information out, maybe I had better start to use some of this information too". I believe that moment has already set in. I guess the basic thing is, to go back to something I stated originally, to ask the question of whether it would
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it be a reasonable thing, by any member's standards in here, if someone came to you and presented you with a contract in which people said, quite bluntly: "I don't understand this. I have to get somebody to interpret this government document for me." Is it reasonable to expect people to simply accept that? I do not believe it is. I think people have begun now to understand that this is an income tax process, however simple it might have been at the start, which has gone astray.
At the very least, it must be understood by the Canadian people, and it is not. At the very same time, it has to have some large measure of fairness involved in it. The people have to be able to say "Well, I don't like paying taxes either, but I understand we are all paying roughly the same kind of taxation." People certainly are not saying that. They certainly are not saying that.
As one goes through the provision of this bill, one can see the kind of traditional approach which basically says "we have identified a problem over here, and so we addressed the problem over there, and maybe that will solve it". We all have watched this process long enough to know that this is not going to work. It never has worked, it never will work, there is not even a chance that it is going to work.
In conclusion, I am not making a pitch for a flat tax or anything as simple as that, but I am making a pitch that in all fairness the people of Canada should be able to pick up a tax form that is put out by the Government of Canada and read it and understand it, and they cannot. There is something basically wrong with that. There is something basically wrong with the notion that my father, who was 91 years old when he died and had a grade seven education, paid somebody $50 every year to tell him that he did not owe the Government of Canada any income tax. He did that to his dying day. There are millions of Canadians in the same boat who cannot function within the system.
The process, I believe, is clearly wrong. The process seems to be almost impenetrable, there is almost no way that one can break through it. I notice that the ministers who are carrying this bill seem to kind of move around. Nobody wants to stay in the Chamber and defend the faith on this matter, with good reason. It is indefensible and it ought not to be.

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Mr. Lyle Kristiansen (Kootenay West-Revelstoke):: Mr. Speaker, I want to thank my colleague from Oshawa for his interesting dissertation. He touched on a couple of points that I know are of some consternation both to myself and many of the constituents I represent.
I think it is the current minister of national health who used to be the minister in charge of nuclear submarines who, when he was in opposition, was the revenue critic for the Conservative Party. He and his party in 1984 and again in 1988, but particularly in 1984, made a great to-do about a campaign to simplify the tax system. I wonder if the member for Oshawa remembers that and if he could perhaps comment a little further on what progress he thinks it may have made in a few ways, if there was any progress, in terms of simplifying that tax system.
Also I would like to comment for a moment and reinforce what my colleague said about the attitude, the Canadian culture, that used to exist that while nobody liked their taxes they paid them. There was some aggravation that perhaps they were paying a little bit more than their fair share, but as long as it was not too burdensome and they could see that their own economic situation was improving however slightly year by year, they were willing to put up with it. It seems to me as it does to my colleague that we are in danger of almost moving into the tax culture of the population in France where people have been making a career for years and years and years now out of tax avoidance. That is the total difference in the whole Canadian culture and attitude toward government, revenue and taxation over the last few years and a very unhealthy one.
My questions are: In what ways, if in any way, has this government since making its major promise to simplify the tax system gone about implementing that? What further comments does my colleague have on the changing tax culture among Canadians and how much more can they take?


Michael James Breaugh: Mr. Speaker, in answer to the first question, here is the answer to whether anybody is getting anywhere with the simple application of the Canadian tax system. This one would just choke a horse, and with good reason. This is the kind of legislation in which one minister comes into the House and reads a
very succinct speech on why this is wonderful and then leaves and lets somebody else carry the can. This is indefensible.
I do not want to justify this, but in fairness I think we should acknowledge that the way modem governments operate would swallow anybody's conscience. It chokes them. Around them are people who advise them on things they can say and things they cannot say. Ministers of the Crown are rarely allowed in this place to actually say what they think. They say what is written and no more and no less.
It is that kind of controlling mechanism which is in part causing the problem. I regret that. I regret that people with good intentions in all political parties in my experience have tried to make changes. I think all of us who are practising politicians understand those changes must come. The tragedy is we have not managed to get that message across to those who are supposedly there to serve, to advise, and who have somehow become people who are there to control.
The second question is more disturbing. It is for me because I am of that generation of Canadians who have felt very good about this country and who felt that while I did not ever enjoy in my lifetime paying income tax, I always felt it was my obligation. I always felt there was some fairness somehow in the system that would work itself out and I am beginning to join the ranks of those who are bitter that they are the last ones left on the line so to speak, that they are there to be exploited in large measure by governments at all levels.
That is wrong and it is particularly wrong when I look around in my own community, and everyone of us here could do that, at people who are very well off who pay no income tax. That is a tragedy and I was reminded of that tragedy again in the last little while and this mindset still seems very strong in the Government of Canada. People at the bottom of the process, people who stand at the wickets and face the Canadian public, our civil servants, are expected to take a zero per cent wage increase this year. The government is in this House every day attempting as best it can to articulate why it is absolutely necessary that somebody else who already has a very nice salary needs a substantial bonus and how there is fairness in that.
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Whatever the legal niceties of that argument might be, the Canadian public looks at that and says words that I am afraid are a little unparliamentary. They do not accept that argument any more. They have sufficient understanding of the process to know that they are the bitter recipients of an income tax system that is wrong.
While they are not exactly sticking their heads out the window, yelling that they are as mad as and are not going to take it any more, I would warrant that they are sitting down at the kitchen table explaining as a family unit how they are being victimized by this process and exploring as many ways as they can to avoid paying their fair share of the income tax. I do not know whether they will be as successful as most of our major corporations, but I will bet that they will give it a try.


Mr. Dennis Mills (Broadview-Greenwood):: Mr. Speaker, I am happy to have the opportunity to rise in this Elouse to speak on Bill C-18, an act to put forward further amendments to the Income Thx Act.
A government's ability to mobilize the will of a nation is based upon trust. Nowhere is the lack of trust more evident in this country than in our current tax system.
The current tax system of Canada with its rules, regulations, exceptions and exceptions to exceptions goes on and on. There is absolutely no way the average person today can fill out his own tax form.
When I was preparing to speak on this bill today I was actually encouraged when I read from the news release from Revenue Canada dated May 24. I noticed the following in the second paragraph: "The fairness package is an important part of my continuing commitment to make the tax system simpler, easier and fairer". This was said by the Minister of National Revenue.
He went on in the third paragraph and talked about how the amendments that would benefit the individual taxpayers in matters such as penalties for late filed returns and interest charged on outstanding balances.
In addition, the fairness package will allow refunds for taxation years starting with 1985 and streamline the process by which individuals can make a formal objection to an assessment issued by the department.
When I read that I was encouraged. Then shortly behind it came Bill C-18. Just the amendments to Bill
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C-18 total 400 pages. Today I just took any page and pulled it open. It was page 220, I want to read one paragraph and ask any member of this House if they can honestly decipher it. It is clause 94, the relevant portion of subsection 118.6, and it is talking about qualifying the educational program. Here is how it reads:
The description of A in subsection 118.9(1) of the said Act is
repealed and the following substituted therefor.
This is the amendment, simpler, easier and fairer, and I read:
A is the less of
(a)	$600, and
(b)	the total of all amounts each of which is an amount that the individual may deduct for the year under section 118.6 or an amount that the individual would have been entitled to deduct for the year under subsection 118.5(1) if the reference in paragraph (a) of that subsection to "the amount of any fees for his tuition paid in respect of the year to the educational institution" were read as a reference to "that portion of the individual's fees paid in respect of the year that may reasonably be considered to have been paid in respect of a qualifying educational program of an educational institution described in subparagraph (a)(i) of the definition "designated educational institution" in subsection 118.6(1)"; and
I am not a lawyer and I am not a tax accountant, but I would challenge any tax lawyer or even any tax accountant to tell me what that means.
I agree almost entirely with the hon. member for Oshawa. The current tax system in this country is a disincentive to national productivity. We have been sitting around this House now for many months talking about national productivity. The one instrument that we control in this House that can generate and motivate a positive attitude toward every man, woman and child in this country is the tax system.
Our tax system is so complex, so unfair, so inefficient and so unworkable that there is absolutely no way we have a chance to become a productive nation. The whole system is designed to be a disincentive to productivity.
If we want a mobilized and productive work force we have to treat them fairly. How can we possibly have a work force turned on to what their responsibilities are if they do not understand? Right now it is blind faith in our tax system. What do they read? We read day after day-and we know it to be true-that just two years ago there were close to 7,000 people in this country whose incomes were in excess of $250,000 a year and they paid absolutely no income tax. We heard from Statistics

October 7, 1991
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Canada three years ago that there were 2,200 companies in Canada with retained earnings in excess of $25 million, excluding companies with losses carried forward. Those 2,200 did not pay any taxes at all.
It is not, by the way, that these people who made in excess of $250,000 and did not pay any tax or the companies that did not pay any tax were doing anything illegal. They are working with legal loopholes. These are laws that are written in to the Income Tax Act of Canada which they are naturally working at and they are doing their job.
What an absolute negative energy. Instead of promoting creative ideas on how we can expand our economy, how we can create more jobs, create more wealth, instead of that kind of a thought process, we have high priced chartered accountants and tax lawyers working with negative energy, legitimate ways to avoid tax.
This is no longer just happening in medium sized and larger corporations. The hon. member for Oshawa earlier today cited examples of people coming to his door and saying there is one price if you pay on a credit card or an invoice and there is another price if you pay cash. Now, because of the tax regime of this country, we have an underground economy that goes into the billions of dollars.
Those are not my words, those are the words of Professor W. E. Dewart from the University of British Columbia, who spent many years of his life analysing the underground economy in this country.
I believe that if we are serious about mobilizing the will of this nation, about galvanizing the will of this nation, about creating a productive work force, we have to start by taking dramatic steps to change the tax act for this country.
I have been working with a group of Canadians from coast to coast who believe it is time to do something radical. We believe it is time to come out with a simplified system, something that everyone understands, something that is simple, because from simplicity you can judge fairness, and when you have simplicity and you can judge a system to be fair, efficiencies pick up and this will
cause us to become a nation that will ultimately create better products and services at better prices. This is how the tax act of this country is really a macroeconomic issue.
The hon. member for Oshawa talked earlier about the fact that people sit around in their kitchens or their living-rooms or their backyards, their gas stations or in restaurants and talk about the frustration of the GST, the paper burden of the GST, the complexity of the tax act, the inefficiency of the tax act. They count on us, not only to realize that and hear those words, but they count on us, the people of Canada to do something about it.
I believe the time is now to do something about it. I have been working hard with many other people to promote the idea of a single tax. You could do a single tax idea, Mr. Speaker, on a form that is no bigger than the size of a postcard. There were tax professionals from all over the country who have verified that this is a doable system.
What you basically do, Mr. Speaker, is you take your gross revenue, whether it is personal income or corporate income, whatever form you are working on, and after you take the personal tax credit, the senior's tax credit, child tax credit, charitable donations tax credit, RRSP credits, after you take all of those credits, at the bottom, 20 per cent. If we do that both on the corporate side and the personal side, we will have enough revenue to satisfy the social requirements of governments in this country.
When you have a simplified system which is about the size of a postcard, then people can judge fairness. When people feel they are being treated fairly, they are motivated. They advance. And when foreign investors look at a country and they see a motivated work force, that is when foreign capital moves in.
That is what we need in order to reduce interest rates, in order to put more money into the marketplace for entrepreneurs, to reduce the cost of mortgage rates, cars. Those are the things that expand an economy. When an economy is expanding, and there is a labour force that is working rather than unemployed, those are the things that put downward pressure on deficits and ultimately on the death of the country.
October 7, 1991

I believe that the only way we are going to get this country back on track is by radical reform of the Income Tax Act of Canada. I know there have been many people who say this idea is off the wall, it is not doable, it is not workable. We are at a crisis point in this country and it is time for the political leadership of this country to take bold measures. It is time for the political will of this country to listen to what is causing people to advance.
The current tax system right now is designed in a way that the harder we work the less we keep. If an entrepreneur in this country decides to work nights and evenings, the harder he or she works the less he or she keeps. It is absolutely upside down.
What is wrong if a person is an achiever, works hard and makes $200,000 or $300,000 a year? We should not have a system that takes nearly half of that. We should not have a system like that. We should not have a system where some of those people can hire very effective tax lawyers and pay absolutely nothing.
The unique thing about a single tax system is that it is an airtight system. Everyone will pay their fair share. No one is exempted. Everyone is in. Legitimate expenses are put on the table, but after that everyone pays their 20 per cent. That is the system.
The current system right now is a disincentive for foreign investment in this country. It is a disincentive to productivity. It does not reward the achievers.
I am happy to have had the opportunity to speak on Bill C-18. The spirit of this government was trying to make things better, but once again the bureaucracy of the Department of Finance wins the day. This bureaucracy in finance-and I realize that it has some of the finest minds in the country-has a self-perpetuating environment in that building.
Can we imagine trying to sell something like a single tax to the Department of Finance which if implemented would probably mean, after a couple of years, about two-thirds of the jobs would have to be reapplied to different departments?


An hon. member:: Is it Liberal Party policy, a single tax?


Dennis Joseph Mills: The member asked: "Is it Liberal Party policy?" No, it is not Liberal Party policy, but it is just
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one simple idea that is being put forward to try to advance the debate on tax reform.
I will say, seeing as the hon. member asked me, that two weeks ago the Young Liberals of Canada passed it as a priority resolution. That is a beginning.
There are flaws in the single tax system. I know that there can be honest debate on whether or not the tax credits for seniors or the tax credits for children that I am putting forward are too generous. The point is that it is a constructive alternative to the existing system.
Are the members over there against simplicity? Are they against fairness over there? Are they against efficiency? There is not one of the members on the government side who is against those things, not a single member.
When we throw an idea over there-and they have always challenged us-why not take up the challenge? I should say the member for Mississauga South has put forward some concerns about the single tax, and some of his concerns are good concerns. At least it gets an honest debate on tax reform going.
Right now, with respect to the government members, they are all captive. I have worked on that side before. I know how tough this is. They are captive of the officials in the Department of Finance. Whenever they put something forward as a government that is simple and fair, senior officials try to find ways to knock it down. This town is a town that lives on paper. It lives on words.
I appreciate the opportunity to speak on Bill C-18. I continue to hope that there will be a groundswell of caring government members who will eventually challenge the cabinet of Canada, the Prime Minister of Canada, by saying it is not too late to take another fresh start at comprehensive tax reform.


Lyle Stuart Kristiansen: Mr. Speaker, I have a couple of questions in particular for the Liberal member for Broadview-Greenwood. I would like to ask him to take his memory back a few years. I am sure he remembers, as someone who has studied the tax system, that at the end of World War II, the distribution of the tax system in Canada and the tax burden was approximately 75 per cent corporate tax and 25 per cent personal income tax.

October 7, 1991
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By the end of the Trudeau government in 1984, that situation had totally reversed itself to where it was at that point 75 per cent personal and 15 per cent corporate.
I would like to know how that measures in with his concept of tax fairness.
The other thing is a little more recent, but it is still about 10 years ago. I am sure my colleague will recall the infamous MacEachen budget of 1981 or 1982, in which Allan J. professed at that time that it was his intent with that famous budget to plug loopholes. He did, in fact, plug a number of outrageous corporate loopholes in his proposed budget. At the same time, he also plugged a number of the very few loopholes available to ordinary working Canadians, especially those who worked in northern Canada, who used to get special housing benefits, special fly-in, fly-out benefits-not benefits, but exemptions from taxation for extra cost of living bonuses-in order to make sure they stayed in the north.
At the same time he was proposing to plug all these so-called loopholes, he said: "Well, seeing as we are plugging the corporate loopholes, we will lower the marginal tax rate". There was a chorus of opposition to that budget, because apparently there was no proper consultation. It was not well planned, which always struck me as very unlike the minister's lifetime habit. I had never known him not to plan anything out very carefully. But he lowered the marginal tax rate.
Then there was a chorus of opposition, and he then unplugged all the corporate loopholes again. As far as the loopholes for ordinary workers were concerned, he got rid of those, but he opened up the corporate loopholes. At the same time as he did that, he forgot to reinstate the former marginal tax rate.
What ended up after that entire budget was a taxation system grossly more unfair than that which existed at the beginning.
I am sure the member for Broadview-Greenwood has some recollections of Mr. MacEachen as well. Does he think that kind of action which was supported by the Liberal party, and is still part of the historical record of that party and its financial record of mismanagement in this country, could have really been an accident? Could that have been an accident and not just, instead, typical
of the continuing Liberal record of foisting more and more of the tax burden on to ordinary, working Canadians.


Dennis Joseph Mills: Mr. Speaker, I thank the member for Kootenay West for his question.
On the first point he raised regarding the percentage for corporate income tax at the end of World War II being about 75 per cent, and personal income tax about 25 per cent, he is absolutely correct when he states it is a complete reversal today. It is approximately $49 billion in personal income taxes that go into the national treasuiy today, and about $11 billion from corporate tax. Of that $11 billion, about 80 per cent is made up of mostly small and medium-sized businesses.
I totally disagree with the system as it is today. That is why I am trying to change it and put forward a different approach. I dare to put something on the table which can be challenged and which is certainly less than perfect. It is a conceptual approach at this point, but it has been analysed by the social development model of Statistics Canada.
The main thing is that it is a doable system, in that it will generate the amount of revenue that the Government of Canada needs to meet its requirements. On that point we seem to be in agreement.
On the second point in terms of Mr. MacEachen's budget under my former boss, Mr. Trudeau, I was around at that time and I remember vividly the frustration, the anger that the country exhibited on that honest attempt by Mr. MacEachen to tiy and clean up the system. If I were to say one thing about what I learned from experiencing that exercise and what I have seen subsequently-I mentioned it in my speech earlier today and I am not against the Public Service so please do not take this out of context-it would be that it is very tough to move the officials in the Department of Finance when it comes to cleaning up the Income Thx Act of Canada. I do not think Mr. MacEachen, for whom I have the deepest respect, was tough enough. I do not think he was radical enough in simplifying and making the system more efficient. It was a great attempt but in the process of falling short you end up not advancing any more. That is the point I am making today. I believe that the days of tinkering with the system are over. It is time for a total radical approach.
October 7, 1991


Mark Joseph Assad: Mr. Speaker, I would just like to ask our colleague from Broadview- Greenwood-


The Acting Speaker (Mr. DeBlois):: On a point of order, the hon. member for Winnipeg Transcona.


William Alexander (Bill) Blaikie: Mr. Speaker, I hesitate to rise on a point of order but it is a point I have made time and time again. The intention of this question and comment period in the minds of the people who were on the committee on parliamentary reform, i.e. the McGrath committee, was that it should be a period for questions to be put to the hon. members who just spoke on a priority basis by members of parties other than the one of the person who just spoke.
In the absence of people rising who belong to other parties, the recognition of people from the party of the person who just spoke is quite in order, but the intention is for members of other parties. I know this is not exactly provided for in the Standing Orders, but I think the spirit of the reform was that and I never hesitate to get up and remind speakers, deputy or otherwise, that is what is supposed to be happening; not these cosy little chats between members of the same party.
In the absence of other people rising that is fine but otherwise it is not.


The Acting Speaker (Mr. DeBlois):: I thank the hon. member from Winnipeg Transcona for his comment. The Chair does try, in the spirit of the rules, to recognize members from other parties so that a variety of views can be heard.
In this case, I had already given the floor to the hon. member for Kootenay West-Revelstoke and I admit that it may be simply because the hon. member for Gatineau-La Lievre is closer to me-

So he can catch the eye of the Speaker easier than you. I note very carefully your remark.


Mark Joseph Assad: Mr. Speaker, I had a very legitimate question that I wanted to ask my colleague. We did not have any kind of friendly chat. It was a simple question.
The president of the Canadian Federation of Independent Business is Mr. Bulloch, or at least I know he used to be the head of it. He probably still is. I know that he
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made some criticism concerning the single tax concept, and I would like to know what my colleague's answer is to the criticism by Mr. Bulloch.
I want to respond to the member for Winnipeg- Transcona by saying that I will give a short answer to my colleague and I would be more than happy to answer any question that he would put forward.
The current small business rate is approximately 10 per cent and the single tax rate at this point, we are talking about a totally integrated system 20 per cent, effectively doubles the rate from 10 to 20 per cent.
Mr. Bulloch puts forward a legitimate concern. Imagine a small businessman making a net profit of $50,000 or a net profit of $100,000 a year. The current rate would be 10 per cent. The rate I am proposing is 20, so that would be an extra $10,000.
Under the complex system that is put forward right now, that small businessman between accountants' fees, lawyers' fees, paper burdens, et cetera, more than pays a 10 per cent factor and it is all negative energy. That is just one answer.


The Acting Speaker (Mr. DeBlois):: Your time is up unless the House gives unanimous consent. Resuming debate.


Mark Joseph Assad: Mr. Speaker, Bill C-18 gives us a chance to raise a very important question and I think that the most important thing in a democracy is the way we tax ourselves. I say ourselves, because after all, this government represents the people, and we elect our representatives to reflect the views of all Canadians. However, over the years, we have developed a tax system that has become so complex and so incomprehensible that it takes lawyers specialized in tax law to find ways to save money for big corporations, the wealthy and the financial elite of this country. Look at how thick this volume is! More than 1,400 pages for personal income tax! And so complex it would take someone educated by the Jesuits, and then some, to understand what this is all about. And now, Mr. Speaker, the government wants to introduce amendments-400 pages worth to explain what was not in the document. That gives you some idea of the lack of simplicity and fairness in our tax system.

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I imagine the average person and the members of this House realize there is something fundamentally wrong with our tax system. There must be a reason for all these feelings of frustration. The tax system has become so unfair and unjust that people spend a lot of effort, a lot of negative energy, to quote the hon. member to find ways to avoid paying taxes. Our tax system should be simplified to make it not only fair and equitable but also appear to be fair and equitable. However, as long as we have volumes this thick, it certainly does not look like a system that is simple, fair and equitable.
The hon. member mentioned that about ten years ago, a former Minister of Finance, Mr. MacEachen, tried to introduce tax reforms in this House. He was inspired by the findings of a royal commission, the Carter Commission, which was appointed between 1962 and 1963 and existed until 1967. Kenneth Carter, whom I consider a great Canadian, made a thorough study of our tax system and produced a document that was literally revolutionary. It contained some unprecedented elements for a democracy genuinely based on every single group in our society. Our Minister of Finance at the time tried to introduce some of these elements. The hon. member mentioned that this aroused a storm in Canada, but Mr. Speaker, it did not come from the middle class but from the big corporations and the financial community. They saw in this tax reform something that would benefit the middle class. Mr. Speaker, business people obviously take care of their businesses, and it is their business to save as much money as possible. You can hardly blame them. They are not doing anything illegal. In fact, they are well within the law. Here is the law: fourteen hundred pages worth, and another 400 pages of amendments.
Obviously, big companies and financiers can afford to call on lawyers, specialists and tax experts to find ways to pay as little tax as possible. Of course, if this class, the wealthiest in our society, does not pay its fair share, the burden falls on someone else: the middle class, the backbone of our society, indeed the backbone of democracy in all civilized countries. Nevertheless, we in the middle class have had unprecedented tax increases in recent years.
Mr. Speaker, I am not trying to say that our friends opposite, the government, the Conservative Party, are
totally responsible for the tax increases. That is not what I am trying to say. I would like to be fair and equitable by saying that for years, governments have not really managed to find a fair and equitable system. That is the issue before us. They call it a reform, but we are not so gullible as to believe that it is one. What reform has been made in the tax system? Has it been simplified? On the contrary, it is more complex than ever. Does the middle class pay less? The people listening to me, Mr. Speaker, know very well that they pay more than their share. How can it be that millions of Canadians find themselves in a situation where the system has become unfair? Unfortunately, I find that our constituents, especially those in the middle class, cannot afford tax experts, specialists and lawyers to check their income tax returns to see if they are paying $200, $500, $1,000 or $1,500 too much.
In any case, they are too busy earning their living and working every They have other things to do and their purpose in life is not to find out how the tax system works. They take it for granted that those who sit in this House are working in their best interest, but it has been a failure on that score. It was a failure because we do not reflect the real values of our society for the middle class. Is it a great discovery to say that the middle class is the backbone of our society? Let us look at how they are treated.
Mr. Speaker, I was greatly influenced by a book written by Lynda McQuade on the tax system. In French, it is called La part du lion and in English, Behind Closed Doors. I found it extremely interesting because it showed that especially in the last twenty years, the financial elite and big companies have exerted pressure-and I am not saying that they have done anything wrong or illegal- they are looking after their business. They literally had the Department of Finance give them some tax breaks that are to their advantage. It is obvious that is what they did and she shows how it was done. People used to say that the rich don't pay. That's all very well, but if you can't prove it, what can you do? But in her book, she shows how the wealthy in our society were able to benefit under a tax system that was biased in their favour, and there are any number of examples. It's very complex, but it's all there.
October 7, 1991

In recent years, the middle class has started to realize that its tax burden has become intolerable. In the past few years, people have started to realize that we are becoming less and less rich. In other words, the middle class is having trouble maintaining the same standard of living it had in the past.
The sixties and the seventies were years of prosperity. The figures are there, and I am not going to quote Global Economics extensively, but this is an in-depht study which shows that during the sixties, a person earning an average wage could save up to 29 per cent of his net income, to spend on holidays or recreation.
In the seventies, this percentage dropped to around 17 per cent. Today, in the nineties, a member of the middle class who earns an average wage will save less than 1 per cent of his net income.
But what does it all mean? It means that we have to pay more than our share. Obviously, something has to be done.
Mr. Speaker, I was on an open-line show with the local host of a popular radio program, Alain Dexter, who has a wide audience and is very much aware of the way our tax system is biased against the middle class. He called me up and asked me to go on one of his shows to talk to his listeners. It was obvious from what people said that they were completely frustrated and, worst of all, they felt powerless. Although we represent the majority of Canadians and although they elect us, they feel powerless before a tax system that is biased against them.
However, what people must understand is that business people have done nothing unlawful. They take care of their businesses, and their business is to save money. Now that makes sense, doesn't it?
Our role, as middle-class Canadians, is to tell everyone who wants to represent us in this House that changes are required. This bill does not contain any. The middle class is taxed more than ever! What is needed is an in-depth review. We have an advantage over many countries in the world. We had a royal commission, the Carter Commission. We can draw inspiration from it to find ways to tax our people fairly and equitably. And once people will have realized that the fiscal system reflects the social values of integrity and justice, there will be no problem. There is no doubt in my mind that
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they will readily accept the fact that there is a deficit which has to be brought down.
I have to congratulate my colleague from Broadview- Greenwood, because everyone here knows how hard he has worked on his single tax concept. His efforts should be recognized. He sought the advice of experts in the field. One of our friends opposite said that there are flaws in his plan, Mr. Speaker. Undoubtedly, and he admitted it himself. However, it is far easier to correct flaws on 2 pages than on 2,000 pages. He made an effort and it was a good way to start the discussions on how to approach the subject. He may not have all the answers, but it is certainly a start because it is by discussing and by submitting ideas- I know that he is aware of the Carter Commission because that was a revolutionary document and he was here then, when the Minister of Finance of the time, Mr. MacEachen, wanted to implement the findings of that commission.
Nothing is easy. It is obvious that everyone wants to protect its own interests. As a former Secretary General to the United Nations once said: "There is no such thing as permanent friends, and there is no such thing as permanent enemies. The only thing that is permanent in this life are personal interests." It is obvious that everybody will fight for that!
But for us the middle class, as well as those who represent it here, our interest is to make sure that the people that we represent are treated in a just and fair manner. That, however, is not the case. They use words such as "reform", but there has not been any reform. And as long as I will have the honour and the privilege to represent the people of the riding of Gatineau-La Lievre in this House, I will work and work and ask the residents in my riding and elsewhere to create a united front. You mau say that everything starts with a dream. The dream that I have is that, at a given time, great numbers of voters will approach all the members of this House to tell them that they are not convinced that this tax system is fair and that they want us the members of Parliament to get on with the task of making sure that it is indeed a fair system.
As I mentioned earlier, there is nothing more fundamental in our society than the tax system. We tax ourselves. If we are incapable of finding a solution, how can we succeed in motivating Canadians to work harder, to keep on paying taxes, and to realize that we live in a

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great country, that we enjoy many benefits and that we want to protect them?
Mr. Speaker, what strikes me when I talk to people is their feeling of powerlessness. It really hurts me because the strength of our country is precisely its people. It hurts me to know that workers refuse to work overtime because they say that they pay too much in taxes. What does this mean, Mr. Speaker? They are convinced that they are paying too much in taxes, that is what they are saying. In fact, they feel that they are paying more than their fair share.
Therefore, I ask my voters that, together, we start saying everywhere what we think, and start saying that we are not pleased, that a reform is needed, and that as long as it is not implemented to bring fairness, there is no chance of keeping the social benefits that we enjoy now. We cannot expect the middle class to forever be the milk cow, because those people realize that there is less and less disposable income.
When I hear the Prime Minister say that the recession is over, I wonder since when it is over. We don't have any more money overnight. We have less and less disposable income; that does not change overnight. If the Prime Minister had really wanted to understand what the people go through, and especially the middle class, do you think that he would have imposed a 7 per cent tax just like that? Do you not think, Mr. Speaker, that it could have been imposed gradually, 1 per cent a year for five or six years or 2 per cent a year, to show that an all-out effort was being made to be understanding.
We saw the frustration with the GST. What more do we need to see the deep dissatisfaction in our society with our present system? I will conclude with that, Mr. Speaker. I am not saying that they are to blame for all the problems on earth and in this country-that is not what we are trying to say. But I am trying to say that their attempt is far from convincing and does not tackle the real problem facing our country.
Mr. Speaker, I would like the government to realize that in this House, we all have the same values to defend, regardless of the political parties represented here. We all have the same values to defend. But if we go
on having the same frustrations with the tax system as in the past few months, if we are unable to see something that clear, what hope do we have for the next generation, which sees that a solution cannot be found for a problem that exists and is at the heart of our democracy?


William Alexander (Bill) Blaikie: Mr. Speaker, the hon. member says that we all hold to the same values. I think part of the problem is that we do not all hold to the same values. We have different values. That is why we have different political parties and this is a place where we debate which values will actually inform and instruct legislation, in this case the Income Tax Act.
Obviously there is quite a difference in the value system which the hon. member for Broadview-Greenwood employed in his idea of how the tax system should work and the value system which the hon. member for Ottawa South, speaking on behalf of the Liberal Party, brings to his discussion of the taxation system.
On the one hand, we have the hon. member for Broadview-Greenwood defending the idea of a flat tax, a single tax, which we know is particularly associated with him. He has been promoting it for a long time in a constructive way. That is fine, but it is confusing for the people of Canada who are trying to figure out what the Liberal Party stands for in terms of tax reform.
Perhaps the hon. member who just spoke could help us in this regard because, on the one hand, we have the hon. member for Broadview-Greenwood saying: "Everybody, no matter what they make should be taxed the same," and on the other hand, the member for Ottawa South complaining on the same day that one of the problems with the tax system we have now is that in the upper income bracket, everybody is taxed the same, whether you are making $60,000 or $600,000, you are taxed exactly the same.
What we have in the upper income bracket right now is exactly the policy that the member for Broadview- Greenwood is advocating. Yet his colleague, the member for Ottawa South is saying that this is one of the things that is wrong with the tax system.
Perhaps the hon. member who just spoke could explain to us how Liberal policy works. Perhaps he could shed
October 7, 1991

some light on the mystery that surrounds the making of Liberal policy, particularly with respect to tax reform.
It must be very confusing for members opposite and for members on this side to figure out just what is the status of the comments of the hon. member for Broadview-Greenwood. It is one thing to have constructive debate within a party. I am not against that, and I think we should see more of that. If that is all that there is to it, that is fine.
Perhaps he could tell us what the official Liberal position is with respect to the single tax.


Mark Joseph Assad: Mr. Speaker, the hon. member has given us a good example of how complex the law is. He has even managed to confuse other people. We are not discussing policy, we are discussing ideas.
We would like to hear the hon. member's ideas on tax reform. We want to be sure that the tax system is fair and equitable. Is there anything simpler than that? That is what we would like to see. There have been attempts in the past when this particular party was in power to come up with elements that could have made it simpler and more equitable.
We never said it was perfect. We are just discussing ideas. The message that comes through loud and clear, as I mentioned before, is that the middle class in our society is paying more than its fair share. They feel it. They are becoming more and more outspoken, and I think that it is time that we addressed the whole problem. We are listening to all ideas. Our friend from Broadview-Greenwood brought up an idea, the single tax. It certainly has a lot of merit and has been discussed in many quarters, but it is one of the ideas that is probably going to bring us in time to what I hope to be a truly fair and equitable tax system and we certainly have not seen it yet.


George Baker: Mr. Speaker, if the hon. member who spoke a few moments ago from the NDP is interested in what the Liberal Party is going to do, he should listen to the member for Gatineau who just spoke and read the writings of the hon. member for Broadview-Greenwood who has written so many papers, books, and everything. He spent days, nights, and months writing. The hon. member should read some of his writings and listen to the hon. member for Gatineau.
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I want to ask a question in the form of a comment. Every time I have listened to the hon. member, and I have heard him over the years-I heard him in another assembly speaking about this subject of taxation as it relates to the middle class-he has always proposed in his speeches before today that the middle class must organize itself to become more effective in the political system vis-a-vis tax reform. Could the hon. member elaborate on that statement he has always made?


Mark Joseph Assad: Mr. Speaker, that is probably the biggest task we have before us. There is so much information out there and it is so complex. You can imagine the average citizen when he sees volumes of this size. Nobody wants to be ridiculed. Can you imagine trying to wade through this and finding an answer?
Obviously we have to find a simpler way. That is what we have been hearing from our people and our electors who form the middle class. They do not want to go into it page by page and the bits behind it. They know they would be lost in no time and they could be ridiculed. Nobody likes to be ridiculed. But they understand one fundamental thing: they are paying more than their fair share. The odd time they read about people earning more than $100,000 or so and not paying any income tax. People having write-offs, multinational companies- there is no end to it.
How can they be indifferent? They are upset and as I mentioned they feel powerless. The middle class needs to get organized.
Obviously I have been in contact with different organizations. They are ready to take up the battle and I know that it is going to take time. In my area there are going to be more groups paying visits to candidates in the next federal election, and they are going to ask, not in 50 or 400 pages, it is going to be one page, how candidates feel about the tax system and where they stand on reform that will be fair and equitable to all Canadians, and that will not be easy to achieve.
In this political system when the different candidates see that the majority want an answer to a problem like that and they see that the electorate is concerned, we will get answers from the members who will be sitting here after that election.


William Alexander (Bill) Blaikie: Mr. Speaker, the hon. member talks about people coming to members wanting to know where they stand. That is precisely what I want to know from him, where he stands with respect to a discrepancy between what the hon. member for Broad-

October 7, 1991
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view-Greenwood had to say and what the hon. member for Ottawa South had to say and he gets up and tells me they are just talking about ideas, not policies.
First of all, maybe he could tell me the difference between an idea and a policy' because it seems to me they are intimately related. Second, he could maybe give some answers on behalf of the Liberal Party. What is its policy or idea with respect, for instance, to the GST? Can he get up and say unequivocally that the Liberal Party will get rid of the GST if it comes into office? That is the kind of thing that people want to know from their political parties.


Mark Joseph Assad: Mr. Speaker, that is an example of a member of this House who, instead of advancing the debate, is trying to find all sorts of "holes" and wondering what will happen if we give up something for something else. Is that really constructive? We are trying to find a complete answer.


An hon. member:: He talks about values!


Mark Joseph Assad: Mr. Speaker, we are trying to advance the debate. Of course, it would be easy for any opposition party to say that it would abolish this or that, as we saw in the past. We just want to point out that it is in the interest of most Canadians to have a thorough study of our tax system done. Saying that you will abolish the GST will not solve the problem. It will not solve the problem, which is much deeper than that!


Rodney Edward Murphy: Mr. Speaker, I too want to join in the debate on the changes to the income tax and other legislation. Later on I will be dealing with one of the proposals in the legislation, the northern tax allowance, and how that is introduced into this legislation.
First let me talk about the policy of the New Democratic Party with regard to taxation versus the policy of the two members who spoke before me on behalf of the Liberal Party. I listened to the two members speak. I tend to forget that they were the government for most of the time since World War II and that the discrepancies and the inherent discrimination that exists within our taxation system is not only as a result of the last seven
years of Conservative rule, but is basically as a result of the taxation system that the Liberal Party of Canada put into place.
The present Leader of the Liberal Party, Mr. Chretien, the former Leader of the Liberal Party, Mr. Turner, were both ministers of finance. When they were not members of Parliament they were both corporate lawyers sitting on various boards of directors. They received, as we all know, much of their campaign funds from corporations. We have to wonder how a Liberal member in this House can get up and say: "It is true that in 1949, about 75 per cent of the income tax came from corporations and only about 25 per cent came from individuals". Then the hon. member said: "Of course, that is changed now." It is true that individuals pay about three-quarters of the income tax and actually much more than three-quarters and yet corporations only pay the smaller percentage. He said: "It is true that of the percentage that is paid by corporations, it is the small businesses that are paying the lion's share of it, not the large profitable corporations".


An hon. member:: Where are the New Democratic Party ideas?


Rodney Edward Murphy: Mr. Speaker, take a look at what has happened in this country. We know there was that old line: Who pays more income tax, the bank clerk with the salary of $15,000 or $18,000 or $20,000 a year of the bank? And Canadians knew what the answer was. It was the bank clerk who paid more in income tax.
I find it ironic today that the Liberals have a speaker get up and say one thing, and another Liberal getting up and saying a different thing. That is so typical, because the members of the Liberal Party do not have a policy when they are in opposition. They have many different ideas, but they do not tell Canadians where they stand. Somehow they forget that their leaders, the present leader and the previous leader, were ministers of finance who helped to create the very system that is a problem today. There is example after example of how corporations have not paid their fair share of taxes.
Someone asked, where are the New Democratic Party ideas? We do not have to only quote from the policy papers that we have put forward in opposition to the GST, where all members of this House know we were the only party that gave specific examples of how we would raise taxes in this country as opposed to having the GST.

We gave examples and we had no fear about sending our report out to Canadians. Thousands of Canadians asked for that report and we sent it out. That was a party document, that was not the document of one individual. We explained our policy, whereas the Liberals as usual were ducking. That is what happened with the Liberals.
As I was pointing out, it is not a new idea. It is not new for the New Democratic Party to say that there are problems with the tax system. It is not new for us to say, as the Liberal member for Broadview-Greenwood is now saying, that the corporations are not paying their fair share of taxes. It was 19 years ago when our previous leader, the late David Lewis, wrote his book on corporate welfare bums The Louder Ibices. The louder voices in our society had the ear of government. They had the ear of the elected representatives, again basically of the Liberal Party, but they also had the ear of the bureaucratic elite within our society.
In other words, the 1,400 pages that form the Income Thx Act today are a result of those louder voices. The 400 pages that we have in front of us as amendments to the legislation are again a result of those agencies within our society that have the louder voices.
As usual, scattered among that Income Tax Act and scattered among the 400 pages, there are a few good ideas that will help the disabled and that will help people in some northern communities. There are always some good ideas, some ideas that help the ordinary Canadian. However, by and large the changes in our taxation policy have not benefited ordinary Canadians.
It reminds me of the debate we had in the House of Commons earlier on the Public Service Alliance strike where it was said that people at the top would get zero and people at the bottom would get zero and that seemed fair. Then we found out that a whole bunch of other things were happening like bonuses and all sorts of performance pay so that the people at the top were still going to get more.
What has happened in our society is that the people at the top have always been getting more, whether we have a 0 per cent wage increase in place or whatever because there seems to be a different set of values, a different set
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of beliefs in how we should treat those at the top and how we should treat regular, ordinary Canadians. Somehow it has always been okay for corporations to have the three martini lunch and have that written off as a tax expenditure. Somehow it has always been okay for those in business to have a second family car and pretend it is a business car. It has always been okay for certain of their vacation costs to be covered by taxation. That seems to be an accepted belief within the government parties.
Governments have always written the taxation laws in such a way that a working Canadian on a regular salary is always going to be paying much more than his or her fair share of taxes, but those who run corporations, those who are at the top of the corporate ladder, those who are at the top of the government bureaucratic ladder, are going to have all sorts of benefits that are not taxed. That is a problem within the taxation system.
There are good ideas that can help alleviate that, but we have to understand that unless a political party is actually going to stand up and have its leader say that that is its policy it really means very little. It means very little when we know that the leader of the particular party has instigated a lot of the discrepancies and problems in our taxation system. It is very interesting to know that. It is very interesting to know that it is not just one, but it is a number of the Liberal leaders who have actually been behind the taxation system in this country at this time.
It is unfortunate that the Liberal Party does not have any ideas as a corporate whole and that it has to say: "We have somebody over here with a good idea on taxation and on human rights". That person over there might have some good ideas as a Liberal on human rights. That person speaks for the Liberals but he really does not speak for them on aboriginal affairs.


An hon. member:: Oh, oh.


Rodney Edward Murphy: The Liberals get upset when that is pointed out. I point that out, not only to criticize the Liberal Party, but because that is the exact problem we have with the present Prime Minister and the Conservative Party.

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Remember the famous line of the hon. member for St. John's West: "If we told you what we would do, you would never vote for us". That was the Conservative line. They did not want to say what their policy was. They too had a strategy. Somebody over here would be saying: "We should have a simple income tax system". This is not a new idea. We used to have Conservative backbenchers giving the same suggestion, but it was never Conservative Party policy. It certainly was never taken up by the Conservative leadership.
There are problems in our taxation system. We do know that corporations are not paying their fair share of taxes and that we have created a system which is so complicated that it can never be fair.
It is ironic that we have had government after government, Minister of Finance after Minister of Finance getting up and saying: "I have proposals here which will make the taxation system simpler". Well, it ain't simple and it is not getting simpler.
Let me give an example, as it relates to the bill, of how complicated government has made taxation. When I was elected in 1979 there were certain benefits that people in the north received which were not taxed. Then as part of the MacEachen budget that was referred to earlier, it was decided to tax some of those benefits.
Then some people said: "Maybe that is not right". So all together we had three different years of moratorium on the taxation of northern benefits. That took us through the first six years of the period when I was elected.
Then the Conservatives came in and they decided they were going to have a northern tax allowance, but they would tax those things like housing, free travel to and from remote communities. They were going to have a northern tax allowance and that would resolve the problem.
Then two years later, after the government made that decision, the Minister of Finance came down with some new criteria which would take away 134 communities that used to receive northern benefits. While he was cutting these northern communities, he added communities to the northern tax allowance system that were bordering on the United States. I am not talking about the Yukon-Alaska border. I am talking about the
border that comes around the 49th parallel. There was another system coming in from government.
A number of communities, including the communities of Thompson and Wabowden in my riding, were quite upset. They were not northern communities, but communities down south all of a sudden were northern communities.
The minister set up a task force with a mandate to come up with a northern benefit system that would be fair and would neither increase nor decrease revenue from the federal government. The commission went out and held hearings for a couple of years. Then after they had finished holding hearings the former Minister of Finance, now the Minister for International Trade, changed the guidelines for that committee. He said it was okay if it came down with a set of packages that may increase or may decrease revenue. Before it had hearings it was told to be basically revenue neutral. Then it had three years of hearings and the guidelines were changed so it could come down with a report which would in effect increase revenue.
That is exactly what the task force did. This task force came down in the fall of 1989 and recommended a procedure that would have created a situation whereby 2,740 communities would lose their benefit.
Obviously that created a bit of a problem for the government because a lot of those communities were in northern Tory ridings. A year later, they decided that idea was not a good one, so they have people coming to government and saying well, we want to change that, we want to change this. So the government came down last December and decided that we will not have one zone for northern tax benefits, we will have two zones. They drew a map and they had it presented and you know what? The idea in itself may have some benefit, but they drew these lines across the country. There is no appeal process, and some of the clauses in the legislation in front of us today basically enables this new process come into place.
Let me give an example of what has happened. Little Grand Rapids is a community in my constituency. It is hundreds of miles from any roads. It does not have a railway, it does not have ships. We are talking basically about a community where everything has to be flown in, or where you need to have winter roads. That is considered to be in the intermediate zone. In other
October 7, 1991

words, it does not receive a full northern tax benefit, but only a 50 per cent tax benefit.
Another community which does not have roads, which does not have any regular access, the community of Bloodvein, is not even considered. This community does not receive any northern tax allowance.
The bureaucrats in Finance came across with a good idea in terms of setting out two different criteria, recognizing that some of the communities should receive 100 per cent northern tax benefit and others should receive a lesser percentage; 50 per cent was the suggestion made here.
But they do not allow for the people to really explain what the situation is. How do you feel if you are in a community in northern Manitoba, northern B.C., northern Saskatchewan or northern Ontario. You do not have any roads, and you are told you are not in a northern community.
I have raised the issue of northern tax benefits more often in this House than any other member. I have had to do so for the last 12 years that I have been a member of Parliament. One of the problems is not the fact that there is a northern tax benefit. The problem is that no one is really listening to the people who live in those communities. That is a specific problem that I felt should be addressed with regard to the legislation.
I think that same problem exists with a lot of other clauses in the Income Tax Act. It always seems that the louder voices are listened to, that the corporations can make the Minister of Finance believe that the three-martini lunch is a reasonable tax write-off because that is necessary to promote business.
We know of all sorts of people who run around making sure they pretend to pay the bill at the end of every lunch so they can write it off as a tax expenditure.
Ordinary Canadians who have to go out and buy tools in order to practise their livelihood are told: "No, you cannot write that off as an expense. What do you need tools for? What do you mean you are a carpenter? You are a welder. Why do you have to buy this equipment?" It may be stipulated in your job description that you need this equipment, but you cannot write it off as a tax expenditure. Now, if that person could go out, he or she
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could probably quite successfully explain why she had to have three martinis for lunch and have that written off as a tax exemption, but not the tools they need for their trade.
It points out the real problem in our tax system, and that is, who is being listened to? Until we find a way to make sure that corporations pay their fair share of taxes, to make sure that expenses are really business related expenses, we are not going to have any fairness in our taxation system.
A single tax may sound attractive to many people, but that is not going to resolve any issues as long as corporations are in a position to declare certain things as regular reasonable business expenses that we know are not really business expenses.
That is the problem, there is no fairness in the system. There is no desire by this government or by previous governments to be fair in the taxation system. There is no policy by the Liberal Party to have a simple, fair taxation system. There is certainly no policy by this Conservative government that gives us a fair and simple taxation system. It goes against their corporate interests.
There is no doubt that there are many people in this society who do not want a fair tax system. It means that the very people on top of the ladder, those in charge of corporations, are going to have to pay more. They know that, and they do not want a fair taxation system. They will ensure that we do not have a fair taxation system in this country.
Unfortunately, as long as the Liberals and the Conservatives are beholden to the corporate elite in this society, they are not going to change the taxation system in this country.


Dennis Joseph Mills: Mr. Speaker, I listened attentively to the member from the New Democratic Party for the last 20 minutes.
He talked about different ideas that we were trying to put forward in order to advance the debate on the tax condition in this country.
I noticed that not once did he put forward a specific idea of the New Democratic Party or, for that matter, from his own riding.

October 7, 1991
Adjournment Debate
I campaigned in the last election against the New Democratic Party. If there is one thing that I noticed it is that people in Canada are fed up with listening to politicians who just oppose for the sake of opposing. They want to hear constructive ideas and alternatives.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Sergio Marchi: Mr. Speaker, I am pleased to be able to utilize the following few minutes available to me to revisit a question I asked on September 23, 1991 of the Minister of Transport with regard to the open skies negotiations with United States of America.
We all know the troubling times that the aviation industry is going through. There were some 3,000 people laid off last summer as you will no doubt recall between Air Canada and Canadian. A few weeks ago, there were another 2,300 people laid off between Air Canada, Canadian and Nationair.
The suggestion is that we ought to make the industry stronger, that we have to right the wrongs and we have to try to establish a strong foundation for a domestic airline industry. It seems to me that this government, going into the open skies negotiations, with suggestions that we are going to get cabotage, which is a fancy code word that says that any American carrier can travel freely across Canada to pick up passengers and drop them off at any point, and therefore compete openly with our domestic carriers.
That will not make an industry stronger, but in fact push not only Air Canada and Canadian probably to merge, but in a number of years, without sounding alarmist, I do not think we will speaking of a Canadian-owned, Canadian-controlled industry.
When this government gave us deregulation in the air, promised diversification and greater competition, meaning better prices for Canadians and meaning more competitiveness in the private sector.
What we have in essence is a duopoly. What happened to all the regional air carriers, the commuter services that were basically gobbled up by the two air carriers, Air Canada and Canadian. In the open skies negotiations, if we give the Americans carte blanche to do to Canadian and Air Canada what Air Canada and Canadian did, with all due respect, to the regional airlines, then I think the conclusion and the net result are quite predictable.
Therefore, I and other colleagues of this side of the House have been asking the government for a clear assurance, a clear commitment that in the open skies negotiations the Canadian negotiating side would not give in as our side gave in during the free trade talks to granting Americans cabotage rights. That is to say, we are in favour of trying to bring the agreement which has been last visited in 1974 up to speed. We are prepared to take a look at various parts of the industry. However, we are not prepared to completely deregulate the industry. We still wish to deregulate it and we still wish to protect our carriers in the face of the giant American carriers. We do not want to do in the air what this government has done to the truckers on the ground.
Therefore we ask the government for a clear undertaking that there will be no cabotage at the end of the negotiations. If there was a choice between cabotage and breaking off the negotiations, this side would be in favour of the latter in respect of our industry and the realities they are in. The minister did not want to answer in a clear concise way, and I am hopeful and am looking forward to the relatively new parliamentary secretary, who has had a fairly auspicious start, who has been fairly co-operative, to perhaps clarify the situation today for Canadians in favour of a Canadian domestic industry.


Mr. Lee Richardson (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, I am glad that the hon. member opposite has given me an opportunity again to put the position of the government on the record.
The approach taken by Canada at the bilateral air negotiations with the United States takes into full
October 7, 1991

account the financial state and the needs of the Canadian airline industry.
At the exploratory rounds held to date, Canadian negotiators have repeatedly emphasized to the U.S. that any new agreement must include a phased approach to implementation and meaningful safeguards to provide conditions that will ensure the ongoing viability of the Canadian airline industry.
These negotiations have included a consultation process that is unprecedented in scope for bilateral air negotiations. The Canadian delegation at the negotiations includes representatives of the airlines, unions and communities. Their views are given full consideration in the Canadian negotiating position.
There is no intention on the part of Canada to give U.S. carriers access to Canada in a manner that would be to the detriment of the Canadian industry, as suggested by the opposition member.
The issue of cabotage has been greatly over-emphasized. Canada will not negotiate cabotage or any other right unless it represents a good deal for Canadian carriers and does not threaten their viability or the preservation of Canada's air transportation system.
As my hon. friend also knows, there are many other important issues to be taken into account such as fair and competitive access to U.S. airports and advantages for Canadian carriers to offset U.S. carrier strengths. All of these have to be addressed so that we end up with a good deal for Canadian carriers and for Canadian users of trans-border air services.


EMPLOYMENT
James Scott (Jim) Peterson: Mr. Speaker, on May 28 I rose in this House to ask the minister what he was going to do about the very serious unemployment that was accelerating and unemployment that was denuding our industries of their work forces and their ability to compete.
At that date in May, unemployment in Canada was at
10.5	per cent. Today unemployment has gone up, in spite of the fact that this government claims the recession is over. Unemployment is now at 10.6 per cent.
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In my area of metropolitan Toronto, unemployment is at 10.8 per cent, above the national average. Toronto used to be the industrial heartland of Canada.
What is happening? This government's policies of giving us free trade and at the same time increasing the value of our dollar by 20 per cent, increasing our interest rates, increasing our tax levels, has driven businesses out of business. It has caused bankruptcies. Thirteen per cent of Canadian manufacturing jobs have been lost in Canada since free trade came in due to this government's economic mismanagement. Two hundred and sixty-one thousand manufacturing jobs have been lost. If this recession ends, many of those jobs will not come back. Sixty to seventy per cent of them are gone forever. The ones that were not just wiped off the map have moved south to the United States.
Why is this? It is because this government has been totally oblivious to the needs of our Canadian industries and what it takes to make our industries competitive and strong.
What is even more alarming is not just the number of jobs we have lost today, but ask anybody in this country who is putting up new industrial plants, who is building new factories. No one. They are just not there.
Is the mood turning around now that the recession is supposedly over? The Canadian Federation for Independent Business revealed in a survey that 36 per cent of small and medium-sized businesses in Ontario are considering moving out with a potential job loss of 500,000 jobs.
We see something that is happening at de Havilland, metro Toronto's biggest industrial employer; 4,200 workers today, announced layoffs of 1,300, plus a threat to close the plant. Will this government give us one firm commitment that it is prepared to stand behind de Havilland and its workers, a leading aerospace industry in the world, producer of the best commuter aircraft of its class in the world?
This government's economic mismanagement has not only driven jobs out of this country, it is continuing to drive those jobs out, and business has lost confidence in this government.
Dramatic measures are necessary and it means a complete reversal of this government's policies, not just

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for my province, but right across this country, or otherwise this ruination, this deindustrialization and this transformation of Canada from a branch plant into a warehouse economy will continue.


Lee Richardson: Mr. Speaker, on behalf of the Minister of Employment and Immigration, I wish to expand in greater detail on the questions of May 28 by the member for Willowdale.
As the hon. member will know, the world economy has experienced its worst slump since 1945. For the first time since 1945, the total production and income of all nations will decline. Canada, unfortunately, has not been immune from these events.
This government shares the concerns of all Canadians with the effects of the slowdown which has recently ended. This government is working to strengthen the Canadian economy and foster the recovery.
The government's policy of debt reduction and fiscal restraint is beginning to yield results. The Bank of Canada rate has fallen by 4 per cent in the last 16 months and is now at its lowest rate since February 1988.
As well, over-all output in the economy has recorded gains in the last four months and the composite leading indicators at Statistics Canada continued to strengthen in July, after three previous increases.
Through its policies of actively pursuing freer trade and harmonious international relations, the government is seeking to increase markets for Canadian goods. International competitiveness is strong in certain industries and workers will have to adapt to compete in international markets. Changes will have to be made and adjustments will occur as a result of a shift in global economy.
The government has recognized that some industries and workers will be negatively affected by this adaptation and it has responded by introducing numerous programs and services. This year alone, Employment and Immigration Canada has allocated more than $3 billion for training and employment assistance for workers, industries and communities.
In the hon. member's home province of Ontario, and the province of my colleague for Cambridge, Ontario, in 1991-92 Employment and Immigration Canada has earmarked $800 million for training and programs under the Canadian Jobs Strategy. These programs are all part of the labour force development strategy, a strategy designed to give workers and industry more direct say in how federal resources are used to address labour market problems.
This labour force development strategy is our government's long range plan for building a strong, highly skilled-


The Acting Speaker (Mr. DeBlois):: Your time is up. The next speaker is the hon. member for Drummond.


TEXTILE AND GARMENT INDUSTRIES
Mr. Jean-Guy Guilbault (Drummond):: Mr. Speaker, I rise tonight as I did several times over the past year and for seven years now to look after the interests of the textile workers and industries in my riding and across Canada.
With the Uruguay Round in 1986, the ministers have embarked upon the most ambitious multilateral trade negotiations ever as well as the most complex and detailed to have been conducted to date. Normally, the Uruguay should have produced a new textile trade framework mechanism.
In fact, the Minister for External Trade described Canada's objectives in these terms on March 2, 1990: first, to strengthen the multilateral trading system while providing sufficient protection to national industries through fairer and more foreseeable competitive conditions at the international level; second, to ensure that, during the transition period, our industry is granted the same protection as our main trading partners, particularly the United States.
As we know, Mr. Speaker, the Multi-Fibre Arrangement, the MFA, which governs the international trade in textiles was renewed unchanged for 17 months on July 31,1991, because the Uruguay Round did not turn out as planned in December 1990, in Brussels.
After examining the latest version of the text by the textile negotiations group, to be used as the basis for the new framework agreement, the textile industry has concluded that it does not meet those objectives.
A number of major changes are necessary, more specifically in the provisions relating to growth rate and competition restrictions. The transition must be very gradual, otherwise Canadian producers will suffer and be at a serious disadvantage, compared with their American

competitors, under the new system of international trade.
I urge the minister to instruct his officials to conclude an agreement that meets the stated objectives and to consider the objections expressed by the textile industry in its letter to the minister dated September 19, 1991.
Under free trade, both countries must have more or less the same external quota system, in other words, the same tariffs and quotas.
If American businesses enjoy better policies than Canadian businesses, it will be a strong incentive for the latter to invest in the United States.
Mr. Speaker, American manufacturers enjoy better protection than Canadian manufacturers. Almost all U.S. textile imports from developing countries are regulated by quotas and bilateral agreements.
The United States have quotas for imports of certain fabrics manufactured in Japan or Indonesia, while Canada does not. In Canada, only 11 per cent of textile imports are regulated by quotas.
Mr. Speaker, if Canada had always applied the same trade policies as the United States, it would not have been necessary to restructure production the way it has done. To become and remain competitive internationally, the textile sector needs external needs the same protection enjoyed by U.S. textile manufacturers.
As you know, Mr. Speaker, the last three years have not been very good for the industry. Its giant, Dominion Textiles, is still losing money. Manufacturers' investments and production capacity have dropped, mainly because of the recession, but also because of the uncertainly around the GATT talks and because of recommendations by the Canadian International Trade Tribunal, which favours a 26 per cent reduction in customs tariffs. The industry is also faced with an overvalued dollar and very high interest rates, as well as requests-


The Acting Speaker (Mr. DeBIois):: I must interrupt the hon. member. The rules state that it is four minutes. Therefore, the Parliamentary Secretary to the Minister of Finance has the floor for two minutes.


Pierre H. Vincent: Mr. Speaker, allow me first to congratulate the hon. member
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for Drummond who has done an extraordinary job as regards the textile issue, since he was elected in 1984.1 think that his good work must be emphasized. The hon. member always expresses his opinions in a pragmatic fashion and in a way that is beneficial to the interests of the people in his riding.
Mr. Speaker, it is my pleasure to answer, on behalf of the government, the important question raised by the hon. member. I want to assure this House that the government works on several fronts to ensure the long term viability and competitiveness of the Canadian textile and garment industry.
For instance, during the present Uruguay Round of the multilateral trade negotiations, we work hard to obtain the gradual and progressive reintegration of the textile and garment trade under the GATT, over a transition period of ten years, so as to give the Canadian industry a reasonable chance to adapt to the new international trade environment.
We are also in the process of negotiating a new mechanism designed to protect our industry against sudden increases that could hurt the textile and garment exports during the transition period leading to the implementation of the normal GATT rules.
In the meantime, Mr. Speaker, we and our trade partners intend to approve the GATT protocol that will extend the Multi-Fibre Arrangement, which expired on July 31st 1991, to December 31st 1992. This will also have the effect of extending the existing bilateral agreements on the limitation of textile and garment imports until the conclusion of the Uruguay Round of negotiations. We expect that new transition rules will be implemented immediately thereafter.
In the context of North American free trade, the Canadian negotiators are in close consultation with our textile and our garment industries, to make sure that their interests are reflected in the Canadian position during the negotiations.
Finally, Mr. Speaker- Unfortunately, I once again-


The Acting Speaker (Mr. DeBIois):: It is because the new rules for this period have become veiy strict and I cannot allow an exception for anybody.

October 7, 1991
Adjournment Debate


MULTICULTURAUSM
Margaret Anne Mitchell: Mr. Speaker, elaborating on my question of September 30, why do we need greater support for multiculturalism in Canada?
This past summer we witnessed acts of racial violence against black Canadians in Halifax and Montreal. Continuing injustices against native Canadians were documented in the Manitoba aboriginal justice inquiry.
Last week I reported on discrimination against persons of colour at Canadian border crossings. Today we read that the Solicitor General of Canada defends the use of ethnic crime data which is contrary to sound human rights practices and will increase racial stereotyping.
Employment equity is not enforced by the federal government and racial minorities do not have equal opportunities for employment and promotion.
While racism escalates and systemic discrimination continues, we have also heard a growing backlash against multiculturalism, particularly against the new Department of Multiculturalism and Citizenship.
The Spicer report illustrated a lack of public understanding of multiculturalism, although its recommendations for a review and for closer co-ordination with immigration and settlement were appropriate.
The Reform Party advocates discontinuation of multiculturalism altogether and funding of multicultural programs. Not to be out-reformed, the delegates to the Conservative Party convention voted unanimously to do away with the Department of Multiculturalism and all funding for multicultural organizations.
Tory resolutions called for the abandonment of multiculturalism in favour of a melting pot policy, restrictions on where new immigrants can live and restrictions on citizenship to require five years of residency.
Canadians deserve to know whether the Prime Minister and his government will follow these Conservative Party policy decisions. Will funding for programs to fight racism be cut? Will advocacy groups that speak for minorities be refused funds? Will obligations on the
Multiculturalism Act be abandoned? Will employment equity for visible minorities continue to be ignored?
On September 30, in the absence of the Prime Minister, the Minister of Multiculturalism replied to my question, defending his department and in particular his priority of working to combat racism.
I appreciate his sincerity but must insist that to be effective multiculturalism policy must have strong support from the Prime Minister and cabinet to become a government priority. The early examples I have cited prove how far we have yet to go.
I also asked the minister to undertake a major public education program to promote a better understanding of multiculturalism.
I did not mean just the programs undertaken on March 21, the international day to counteract racism. We need a revision of Canadian history books to reflect accurately ethnic history. We need to enlist actively the support of the media which too often add to stereotyping and hysteria. We need thoughtful public discussions about the changing nature of Canada, our multicultural heritage, our appreciation of diversity, and our national commitment to protect minority rights.
As Canadians reconsider our future, we must have full participation of persons and groups from all ethnic origins. Multiculturalism is not just for ethnic minorities. It reflects the very nature of our citizenship and our national values. Recognition of this fact must be reflected in all aspects of government and in public policies.


Mr. Vincent Della Noce (Parliamentary Secretary to Secretary of State and to Minister of Multiculturalism and Citizenship):: Mr. Speaker, given the time available, I will try also to give my colleague as comprehensive an answer as possible. First of all I would like to stress that the hon. member for Vancouver is supporting the eradication of racial discrimination in Canada. I would like to point out to her that there is a big difference between the preliminary resolution, passed by delegates at the last Conservative convention and the actual policy of the government. Indeed, the constitutional proposals recent-

ly tabled in the House confirm the government's strong commitment to equal participation, common citizenship and national unity.
The federal government is determined to play a leading role in the eradication of racism and racial discrimination in this country. However, this is a task which it cannot carry out alone. We need the cooperation of all Canadians, all government organizations as well as the private sector if we want to achieve progress in eliminating barriers to equality and full participation in our society. That is the reason why, Mr. Speaker, last summer, following some incidents in Halifax and Montreal which increased racial tensions, the Minister of Multiculturalism and Citizenship set up in Nova Scotia an Advisory Committee on Race Relations.
This advisory committee, made up of representatives from all three government levels and the black community, had the mandate to come up with an action plan and make recommendations to fight racism. In thirty days, the advisory group was able to write a report which they presented to the Minister of Multiculturalism and Citizenship on September 11. That is an excellent example of what we can achieve by working together.
Mr. Speaker, Canada continues to act on the basic principles mentioned in the Canadian Multiculturalism Act. I would like to point out some of the initiatives taken so far, such as the creation of the Canadian Centre on Policing and Race Relation. That centre seeks to improve relations between the police and various cultural groups in Canada.
I would like to continue, Mr. Speaker, but I can see my time is up.


AGRICULTURE
Maurice Brydon Foster: Mr. Speaker, on October 25, I put a question to the Minister of State for Grains and Oilseeds concerning the financial disaster which is facing Canadian farmers. I pointed out to the minister that spontaneous rallies were being held across the country, from Lucknow, Ontario to Miami, Manitoba to Russell, Manitoba to Rosetown, Saskatchewan and right across the country.
I put this question to the minister: How much longer do farmers have to continue to rally? How much longer
Adjournment Debate
do they have to continue to lose their farms? How much longer do their families, their livelihood, their integrity as farmers in rural Canada have to be put under this kind of sledge-hammer action by the government before there will be action?
It was very interesting that when the minister replied he said: "You would think that the whole problem is the result of this government's policy". That is exactly the problem. The government provided very extensive support to farmers in 1987, 1988 and 1989.
We will recall that 1988 was an election year. What we are concerned about is the way the government dramatically chopped support last year. It cut support across this country to Canadian farmers by $1.3 billion, approximately $1 billion in western Canada and $300 million in eastern Canada.
At the same time that this government was chopping support to Canadian farmers, the value of their grain was dropping by some 30 per cent from roughly $135 a tonne for wheat to about $95 a tonne for wheat.
This spring the government brought in a new safety net program. Generally farm groups were saying they supported the safety net program with one proviso. Because of the government's cutback in support last year on the 1990 crop, they were asking that there be special, transitional support this past spring. In the west they talked in terms of $1 billion. In eastern Canada they talked in terms of $200 million.
What we have seen since that legislation was passed is a series of non-cash assistance. In fact, no cash significance of any amount has been provided since last spring. That is why we are seeing momentous rallies forming all over this country. This is why farmers tell us they are in the worst financial crisis in living memory, because of the price of wheat, because the government has welshed on its commitment to provide that emergency cash transitional assistance.
The most maddening part of it is that we hear all kinds of smoke screens as to why it is not doing this. It is consulting with the third line of defence. The Prime Minister threw out a tidbit last week in Winnipeg that he is considering it. He is asking for a recommendation.

Adjournment Debate
The fanners have been asking, simple and plain, since last March and April: "There is a crisis on our hands. If you don't do something there is going to be a desperate situation". Canadian farmers are facing that desperate situation now. They want action by this government.


Mr. Murray Cardiff (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, it is an honour to be able to respond to the hon. member for Algoma. I want to say that this government has always supported our farmers and will support our farmers in this great nation of Canada. To have someone say that we have not is just not the case at all.
GRIP and NISA were developed at the request of producers to replace a system of ad hoc payments. That is what it was over the last few years, just ad hoc payments to deal with a situation that is not predictable. How can a farmer go to the bank with a program like that?
That is the reason the safety nets were put in place. They are bankable programs. Before you plant a crop you can go to your lending institution and get the support that is necessary to plant that crop.
Also, because of those safety net programs, over the next 12 months approximately $2 billion will be delivered to farmers through these programs. That assistance will be most helpful, I know. No matter what the hon. member for Algoma says, $2 billion is a lot of money. As someone said in the House today: "That is not chicken feed".
We know there continues to be hurt out there. There is no getting away from that. We are committed to doing the very best that we can to support our farmers through this very difficult time. The fact is that the government has been there for Canadian farmers, as I said before. As I said, our record of support for agriculture is unprecedented.
Just last Friday the Prime Minister met with farm leaders in Winnipeg to listen to their concerns but, more important, what the Prime Minister did at that time was he gave his commitment that further cash assistance would be forthcoming. The Minister of Agriculture and the Minister of State for Grains and Oilseeds will be reporting their findings and recommendations to the Prime Minister by the end of this week.
We will then be able to respond to the needs expressed by the farm leaders throughout Canada. That is part of the established program that is there to work with the farm leaders in this country to deliver the programs as are needed.
We will still continue to pursue our efforts through the GATT agreement and the negotiations that are taking place there. I just want to reinforce that this government does support our agricultural industry in this country. [Translation]


The Acting Speaker (Mr. DeBIois):: The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 10 a.m., pursuant to Standing Order 24(1).


[Stage Direction]
The House adjourned at 6.32 p.m.
[Stage Direction]
Tuesday, October 8,1991