1991-09-23

Mr. Ron MacDonald (Dartmouth) moved:: That, in the opinion of this House, the government should consider abolishing the regional rates of pay, now in force for certain federal government employees, in accordance with its stated policy of pay equity.
He said: Mr. Speaker, it is with a great deal of pride that I rise once again to speak in this House about the issue of regional rates of pay. Some people might remember, I think it was June last year, when I had the pleasure of rising in this place to address a similar motion concerning this foreign practice.
I looked at Hansard from June of last year, when this motion was up in the last session for debate. I noticed that there was a consistency in the approach by members opposite on the government side and that they did not want to speak to the issue of regional rates of pay. They wanted to play semantics dealing with whether or not this was a pay equity issue. They spent a considerable period of time missing the issue.
Before we start today I would like to say, right off the bat, what I believe this is all about. The lack of national rates of pay in some categories within the federal Public Service means that we do not truly have pay equity. What pay equity means is equal pay for work of equal value.
It is the stated belief of the government, and governments across this country, that people should be paid for the effort and skill they put into their work, not based on the colour of their skin, their gender, and certainly not on their language. It appears that there is an anomaly in
this one situation because this government continues to support a system of regional rates of pay.
Quite simply what that means is that a pipefitter in Dartmouth, Nova Scotia gets paid considerably less working for the Government of Canada doing a contract job as described by the government than an individual in any of a number of regions as defined by the government. In particular, they get paid about $6 an hour less in some circumstances than those people doing the same job, with the same skills, for the same government in other places, particularly on the west coast.
We have to look at the history of this. The government is going to get up and tell us that regional rates of pay have been there for a long period of time. At one time there were 30 or 40 different regional rates. That is what they are going to tell us.
Then they will come back and say that they are working toward that and there are only 10 or 12 regions left whereby by legislation we discriminate against individuals.
I want to make something very clear. Wage discrimination that is based on where a person lives is no less abhorrent than wage discrimination based on gender, language, or skin colour. There is no difference. Maybe what we have to do down on the east coast-and I say it tongue-in-cheek; perhaps the government is simply not moved by the argument-is speak some type of pig Latin or perhaps adopt Gaelic as our language in places like Nova Scotia. Then we could go to the Human Rights Commission and get an order that says to this government that it cannot discriminate against this particular group of workers. It cannot pay workers less on the east coast than it does in other parts of the country.
In the dark old days it was acceptable to do that, but the country has changed. Tomorrow proposals will be tabled in this House in an effort to try to keep this country together. What we always hear in proposals that come forward to rebuild a country is that we must, through our Constitution and through our legislation, inject equity and fairness to all Canadians. It is interesting to note that when this motion was debated by me the last time, we were in the midst of the road running between the Chateau Laurier and the Congress Centre. It was a year ago June, when Meech Lake was just about

September 23, 1991
Private Members' Business
to hit the rocks. I noted then with some irony that the first ministers of this country were down the road talking about drafting a document to instil fairness and equality, but their members were standing up in this House and saying no to pay equity in regional rates of pay.
I want to list a couple of groups, and I will do this rather quickly because I have a lot to say on this issue. There are a number of groups that are paid, not according to the job they do or the quality of their skills but by where they work. They are all employed by the federal government. Scientific and professional category, education, seven different regional rates; nursing, eight different regional rates; occupational physical therapy, seven different regional rates. The list goes on. Occupational categories, I am going to spend most of my time dealing with this. General labour and trade-ten different zones.
It means that a pipefitter or a sheet metal worker can get any one of ten different rates of pay. I can guarantee that in almost every single case a pipefitter in Atlantic Canada is going to get the lowest rate of pay. That is what regional rates of pay have done to us.
Way down at the bottom is ship repair. There are only two rates, east and west. The Halifax-Dartmouth shipyards, the government shipyards, are the ones that the Prime Minister during the Persian Gulf situation got up and applauded in this House for the incredible effort that they put into refitting the vessels that we were sending over into a theatre of war. He said what marvellous men and women they were and they rose to the call of duty. It doesn't sound like the type of individuals to me that are so bloody greedy that they are absolutely intent on screwing the government out of a few dollars in the interests of fairness and equity. But yet those same dockyard workers down in Halifax-Dartmouth, over 1,200 of them, are currently without pay equity.
I want to refer to a paper here. I met with the unions and I talked to them and said: "Look, you know regional rates of pay are going to go by way of the dinosaur, but we have got to push on it". But I look here and see on a wage scale chart that the same workers, federal government dockyard workers on the west coast, in May 1990 were paid an average 14 per cent higher than those on the east coast. By January 1991-and keep in mind, Mr. Speaker, that the government says it is trying to collapse these regional rates-the discrepancy rose to 19 per cent. In October 1992 it will be up to 28.35 per cent difference, and yet the government gets up and talks about its absolute commitment to pay equity. Absolute hogwash, Mr. Speaker.
A couple of interesting things have happened. Back in the fall of 1989 we had a situation arise where the ships' crews, normally designated as essential employees so that they cannot go out on strike, were without a contract for a significant period of time. These men and women who worked on ships' crews on the east and west coast, mostly on the east coast, made a decision that enough was enough. They were no longer going to sit back and be loyal little lap dogs to the government and accept significantly lower salaries for a dangerous job that they did on behalf of the Canadian government and the Canadian public.
They went out on strike. It was not because they were looking for massive increases. The government opposite had painted these employees as greedy. Do you know how much they got paid, Mr. Speaker? The average pay for a ship's crew employee on the east coast of Canada was between $19,000 and $22,000 a year. Boy, they had cushy jobs, too, you know: all they had to do was risk their lives for the people of Canada! They were on Coast Guard vessels and when there was a storm and there was a ship in trouble, they went out on the high seas and risked their lives for $19,000 or $21,000 a year. But this government, as callous as it is, was then and continues to be, absolutely refused the one small request to pay the people on the east coast who risked their lives for this country and this government the same as the people on the west coast.
They forced them out on strike and we saw this awful legislation introduced in the House, strike breaking legislation, to force them back to work. The Liberals and the New Democrats opposite held that legislation up, and we forced the government every step of the way to invoke closure every step of the way.
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When it was all over and done with, my colleague here from Ottawa, who is a Public Service critic, filibustered in this House to ensure that the rights of those workers, the ships' crews and other public servants were not going to be trampled on easily in this place.
So what happened? They went to arbitration. The government refused to close a wage rate between the east and west coasts, perhaps causing a problem with public safety. At least it claimed it at the time, although we objected and said that was not the case.
What happened when it went to arbitration? I want the members opposite to listen. The government refuses to negotiate in good faith when it is dealing with regional rates of pay or with any public servant, as we saw with the recent PSAC strike.
The binding arbitration report, after this government legislated those $19,000 to $21,000 a year employees back to work, said clearly that effective the date of the signing of this collective agreement the following would happen: (a) it would bring east coast rates of pay to parity with the west coast rates of pay.
It is clear. A three-party arbitration panel with a member of the government could not even justify the further discriminatory practice of allowing regional rates of pay. It was an unnecessary strike it forced those workers out on, because it really does not care.
There is another thing that is interesting if you look at the guidelines, and I want to read this one: "Federal Public Service compensation policy-guiding principles". These are pretty interesting. It says that the employer's approach to compensation determination for federal public servants shall follow some guidelines: (a) that public sector compensation be fair to employees and to the tax paying public. We hear them twist that one around all the time and say that the poorest of the poor are not worthy of a decent liveable wage-we heard that last week when we had the strike-and (b) that public sector compensation be related in a reasonable and acceptable way to the private sector, with compensation not exceeding that paid for similar services by the private sector.
I want to highlight that because when this motion was put last June all we heard from the members opposite reading by line from a speech prepared by Treasury
Private Members' Business
Board was that they cannot do away with regional rates of pay because if they did, the private sector in those areas would collapse as the rates of pay would be too high.
One cannot have it both ways. I want to go back to the ships' crews strike. It is pretty interesting. The government refused to admit that the binding arbitration was found to be factual. In dealing with the ships' crews strike it says when the government refused to pay them a living wage: "We are also satisfied in the peculiar circumstances of this case that there is legitimacy to the alliance claim that a significant and glaring disparity has developed over the past several rounds of negotiations with respect to the compensation paid to government ships' crews as compared to ships' crews in the private sector".
It goes further somewhere else in the decision to say that if allowed to go unchecked it would reach 38 per cent disparity. The government wants to claim that it cannot touch these regional rates because somehow it is going to have a massive negative impact on the private sector. Hogwash. Nonsense. This government continues to perpetuate a policy that should have died in the dark ages of wage discrimination based on where an individual lives.
Back over to the dock workers, 1,230 or 1,240 souls, the same people who fitted up in record time the Canadian navy in its valiant effort with the UN in the Persian Gulf. Those individuals are now negotiating a contract again. The charge hands who were sort of the supervisory personnel went straight to binding arbitration. I do not have a copy of the report with me, but my understanding is that that binding arbitration when it came down a week ago Friday clearly and up front said that the regional rate of pay had to be collapsed and that a national rate of pay had to be instituted.
It is not just me standing here telling this House of Commons that this motion should be acceptable and that the government should look at it. The government's own process of arbitration in dealing with many of these groups that are affected, particularly on the Atlantic Coast, in a very negative way by the discriminatory practice of regional rates of pay, of paying somebody less for a job based on where they live, has gone the way of the dodo bird.
September 23, 1991

Private Members' Business
It has got to go. Maybe the message, if the government did not have before us some Draconian legislation, could basically destroy the collective bargaining process. All of those groups affected by regional rates of pay should simply say: "We want binding arbitration".
The record since a year is clear. In each and every case where regional rates of pay were an issue and went to binding arbitration, the panel said: "Enough of this. We have to close that wage gap". That is exactly what we have to do.
There are a couple of other issues here that have to be addressed. One is whether this government is truly concerned about fairness and equity. I did not have a chance in the short debate that we had on the awful back-to-work legislation this government put forward to challenge or question the government's credibility when it talks about its wish to have pay equity.
It wants to look at pay equity as a gender problem within the federal Public Service. It talks about how it wants to get rid of discriminatory practices and what wonderful people it thinks our public servants are.
I will read a couple of quotes by our own Prime Minister. I think they clearly indicated the disdain and the disgust with which this government treats public servants, most of all those public servants who do a damn good job for this country for very little remuneration and very little credit from the current government.
As reported in The Ottawa Citizen, April 9, 1983: "Any bureaucrat who did try to oppose him (Mulroney) would be greeted with the words 'Voila ton pink slip'".
Another interesting quote from our Prime Minister, the head of our government which espouses that it truly believes in and is in pursuit of wage parity, "pay equity", is from CBOT, Newsday, May 26, 1983. Talking about the Public Service, he said: "They have never worked a day in their lives. They have never done a day's work". That sort of says it all.
This government under the leadership of this Prime Minister is absolutely intent. It always has to have an enemy, and the enemy that it has chosen in the last number of years is the federal Public Service.


An hon. member:: One of many.


Ronald MacDonald: One of many.
In conclusion, I would urge the government, if it does not want to listen to me, to look at its arbitration reports. Will the government for once do the right thing and agree that in 1991 there is no place in a modem democracy for a system of pay by the federal government, the people who legislate laws in this country and pass laws and codes of behaviour by statute, which is abhorrent and discriminatory, a rate of pay which does not pay individuals for the work they put into products but rather pays them according to where they live in this country.
I would hope, now that it is the second time around on this particular motion, that the government would look at the record and see fit to announce forthwith through President of the Treasury Board, in spite of the regressive freeze legislation that it has on, that regional rates of pay are going to be exempt from that and that the gap will be closed.


Mr. Bill Kempling (Parliamentary Secretary to President of the TVeasury Board and Minister of State (Finance)):: Mr. Speaker, this issue as the member has said is on its second trip around the racetrack. It was featured during the 1988 election, particularly in Halifax.
It has been the policy of various governments since 1967 and continues to be the policy of the government today to reflect local rates of pay for Public Service employees in occupations where outside data indicate significant variations from the national average.
In other words, we tend to reflect the regional rates in the wages that we pay for the various jobs. It is not just ships' crews and repair crews and so forth. It covers a whole range of public servants in various regions of the country. We cannot say that it just covers two groups, because that would be another case to be made.
My remarks are somewhat constrained, but I do note that a small group of employees in the Saskatoon area is challenging the regional rate policy of the government under section 15 of the Charter of Rights and Freedoms. Since the court proceedings have commenced on this issue, it would not appropriate to get into anything more than generalities and general comments on this issue.
In his comments the member mentioned and equated regional rates with equal pay for work of equal value. He knows full well that the government has passed legislation pertaining to equal pay for work of equal value. He
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knows also that there have been considerable payments and adjustments made as the result of that legislation.
I am just looking for the bill here. I think it was June 1986 that the bill was passed. The member should recall the comments of the President of the Treasury Board of the day in January 1990 regarding equal pay for work of equal value. He announced that the first phase of lump sum payments would be $317 million and it would be made as quickly as possible. This is a gender difference in wage rates, where men and women are doing essentially the same work. The feeling is and the government policy is that they should be paid the same rate.
In the announcement that the President of the Treasury Board made on January 26, 1990 he said that the rates would be retroactive to March 1,1985. The retroactive payment will average something like $4,800 per employee affected. The affected employees work in all parts of Canada and therefore it is not reasonable in that sense.
The second phase involves $76 million in annual salary adjustments effective April 1, 1990. The amount of wage adjustments and retroactive payments will vary depending on the pay disparity identified for any particular occupational group and the amount of time an employee has been in a particular position or positions.
We have moved substantially on pay equity. My secretary was telling me the other day about a young lady who worked on the Hill, then left the Hill to work in another government department and has now returned to the Hill. To her surprise she received a cheque in the amount of something like $3,700. When she inquired as to what it was for, she was told that it was pay equity. It is going on and it is working.
This matter of regional rates is a difficult one. Living conditions vary from one part of the country to another. I do not suppose there is a trade category that could be imagined, whether it is auto mechanics, plumbing or any craft or trade in which the rates are uniform across the country. They are not uniform across the country. They are not uniform in the private sector across the country.
Private Members' Business
The concern, not only of this government but of previous governments, has always been: Are we going to distort the local situation? Are we going to cause a distortion in the private sector if we pay a rate in Halifax that is paid in Vancouver?
The other thing the member is missing in his comments are the fringe benefits. There is no regional disparity in fringe benefits whatever, and he knows that. He should reflect on that as well. There are substantial fringe benefits and they are all subject to negotiations. I do not suppose there has been a negotiation between the Public Service unions and the government in the last many years that has not had this issue of regional rates as part of the discussion. I have no doubt in my mind that the discussions going on this very day, probably this very hour, between the President of the Treasury Board and Daryl Bean and the PSAC negotiators have the regional rates on the table and are being discussed.
Since we have been in government, since 1984, we have followed the practice established in 1967. That is not to justify it in any way, but that is the practice and that is what it has always been. I believe the concern is that in an area where there may not be absolute boom conditions and tradesmen are not paid substantially higher wages than Public Service employees, if we moved to raise those rates beyond the local rate that is being paid, we would cause some very serious economic conditions within that area.
The other point that the member has not talked about is skills. These rates are based on base rates, but there are skills rates beyond that which he has not dealt with. Many of those persons, by updating their skills, could have an increase in their wages.
First of all, I reject the comparison of pay of equal value to regional rates. I just do not think it is a valid comparison.
As I said, the matter is before the court in Saskatoon and we will have to see where that plays out but, at the present time, that is where the policy of the government lies and we will reflect local rates in our regional rate efforts.


Mr. Cid Samson (Timmins -Chapleau):: Mr. Speaker, I rise today in support of the motion put to the House by the member for Dartmouth.

Private Members' Business
Primarily what this motion does is try to bring together the outlying areas of our country to the central part of our country. We are trying to bring people together.
What I hear from the government side is that we are going to cause an imbalance by agreeing to this motion. We are going to cause an imbalance in the area that we are servicing. The private sector will not be able to afford to keep up with the rates of pay.
The member from the government side just indicated that the government has already introduced pay equity for gender reasons and it has sent cheques out to various regions. I did not hear him saying that it has caused problems in the private sector. It brought them together.
When we look at the trades and we talk about skills, if I were a tradesman on either coast or anywhere in this country, I would take personal offence at the comment that was made by the member opposite when he said that skills enter the picture. I was a plumber before I became a politician and I am as much a plumber on the west coast as I am on the east coast as I am in Ontario. My skills do not vary. Why is there a difference in the rates of pay for shipbuilders, for pipefitters, for electricians and for other trades? A buck is a buck and a pipefitter is a pipefitter.
Quite frankly, Mr. Speaker, I think what this government is trying to do is to create, with these regional rates, dissension within the ranks and keep them arguing between each other so that they can pit one against the other and have them say: "I am better than you are because I am getting paid more." I think we all have something to offer. I think we are entitled to equal pay for work of equal value. To tell someone that their work is not as valuable as someone else's is a severe slap in the fact to that individual.
We cannot continue to have these regional rates of pay because we are classifying when we do that. No one in this House or in this country is any better than anyone else and is no worse than anyone else.
I would like all members in this House to ask themselves this question. Would they consider taking less pay as members of Parliament because they come from different regions of this country? I think the answer is quite clear. We all figure we are doing as good a job as the other person and we want to get the same amount of money as that person. That is no more or no less than any other government employee is asking for.
I think my comments are relatively brief but to the point. I think that we need to have a national rate of pay for all our government employees. They contribute as much as anyone else in this country and they do not deserve to be treated any less or any differently than anyone else. I certainly hope that the Conservative members will come to their senses and support this very important and very needed motion.


Mr. George S. Baker (Gander-Grand Falls):: Mr. Speaker, I rise to support this motion by the hon. member for Dartmouth. The hon. member for Dartmouth has been pushing this issue ever since he became a member of Parliament.
Coming from Newfoundland, I appreciate having a fellow member pushing the issue as hard as he has pushed it. I have watched him in caucus as well make the same points over and over and over again. I think that the message is getting through.
If you are a machine operator with the same employer, working in Saskatchewan, you can go up to $15 an hour. But if you are working in British Columbia, excluding metropolitan Vancouver and metropolitan Victoria, you can go up to $18.84 an hour, a difference of almost $4 an hour. If you are an electrician, you can go to the top of your scale to $16.31 if you work in Newfoundland, Nova Scotia, New Brunswick or Prince Edward Island, $16.31, but if you were in metropolitan Vancouver, metropolitan Victoria, you could go up to $20.71 an hour. That is a difference of $4 an hour.
Some occupations have a difference of $5 an hour. Some of them are $6 an hour, doing the same job with the same employer. It depends on where you are working. These are all tradesmen, receiving $3 or $4 an hour difference, depending on where they are working.
The federal government, as the member for Dartmouth knows, keeps coming back as the representative of the government said a few moments ago, and saying: "We want to keep it down to the going rates in the area so that it will not be an unfair competition with the private sector in that area". That argument fails and it fails badly because of a couple of points. Number one, the federal government turns around in some of those same areas where the wages are being paid are low because of the going rates, says the government, and gives them environmental allowances on top of the wage or gives them isolation pay on top of the wage. There is no logic behind where the dividing line is, Mr. Speaker. I cite you an example. A few moments ago the hon. member representing the New Democratic Party said that he was a plumber before becoming a member of Parliament. If he were a plumber in British Columbia working for the federal government, excluding metropol-
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itan Vancouver he would start at $17.11 an hour. But, if he were working in metropolitan Vancouver, he would be making $17.69 an hour. In other words, if he were working in metropolitan Vancouver he would make more than if he were working in B.C. outside metropolitan Vancouver as a plumber. If he was a pipefitter he would make $12.09 an hour if he was in British Columbia excluding metropolitan Vancouver, he would make less than that, $11.92, if he were in metropolitan Vancouver.


An hon. member:: It makes no sense.


George Baker: Here we go. We have a plumber who is paid more if he is in metropolitan Vancouver than if he is outside and we have pipefitter who is paid less if he is in metropolitan Vancouver than if he is outside. It is utter nonsense. It is complete and total nonsense. It is a violation of the human rights of an individual.
Some reference has been made here to the fact that the Human Rights Commission has always turned around on the basis of what is in the Human Rights Act. They cite section 11 of the act, and I don't have to cite section 11 for the hon. member for Dartmouth or for any other member. They know that it says that an employer cannot pay different wages to a male and female if they are working in the same establishment and doing the same work or work of equal value. They say that is not a violation of the Human Rights Act.
I suppose we could say that they are not working in the same establishment. They are working for the same employer and there is a dividing line. It is not only by province, but if one works inside or outside a metropolitan area. However, certainly, the principle of fairness is absent in regional rates of pay.
Can you imagine, Mr. Speaker, a group of federal employees who are sent to a location on a big job, and you have one from this area and another from that area and they are all carpenters, say, and every single one of them is making different wages because they have been sent in from their home territory where they normally work to do a job? Can you imagine how people feel who are mobile in the Public Service, as we had the case a
Private Members' Business
couple of years ago of the crews where they would all meet in Cambridge Bay up in the Northwest Passage? They would tie their boats up, and one fellow was making $3 an hour more than another fellow. The ship repair crews-the hon. member for Dartmouth has 300 or 400 or 500 I suppose in his riding- have different rates depending on where they are from. It just so happens that the hon. member is representing the lower end of the scale. These people are doing the same work, the same job as everybody else is doing.
This has led to a demoralization of the Public Service. The Canadian public expects service from the Public Service; they expect service from them. Here are public servants working in Gander, Newfoundland or in Grand Falls, Newfoundland or Dartmouth, Nova Scotia, and they are doing the same job as somebody living in another province and they are being paid less. They are being paid $7,000 a year less than somebody in the same classification, but they are working in a different area of Canada. It is demoralization of the Public Service.
The Government of Canada is always trying to do things to increase productivity. It paid out big productivity bonuses recently to the fat cats, the big guys making all the money. It paid them these big bonuses, payoffs for layoffs, to get rid of people.
You are always looking over your shoulder wondering who is making judgment on you today. Here you are sitting down doing a job somebody else is doing, same classification, same work, and receiving $4 an hour less because of where you live in this country, with the same employer. Then you have a manager looking down your shoulder and you know that if that manager manages to get rid of you he gets a bonus a Christmastime.
The Government of Canada should not just pay attention to what is in the Canadian Human Rights Act. No act of Parliament is without its mistakes, and there were mistakes made when this legislation was passed. Surely by strict common sense no member of Parliament would like to be paid on the basis of regional rates of pay. Mr. Speaker, on a scale of 12, your province is about number three from the bottom.

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Private Members' Business
Just imagine if members of Parliament were paid on the basis of regional rates of pay. It would not be a very attractive business for somebody from eastern Canada, I can assure you of that.


Mr. Howard Crosby (Halifax West):: Mr. Speaker, the member for Dartmouth, in bringing this matter to the attention of the House of Commons, namely the subject of pay equality across the nation, joins the ranks and choruses of a number of members who have raised this point in the past including myself.
I want to begin by telling all members that I have canvassed this subject from a to z and all aspects of it. So I make the comments I make today on the basis of that study over a period of time.
First of all let me make it clear there is a principle involved which the Canadian Public Service has accepted for decades. That is that public service compensation must be fair to both the employer and the employee and to the taxpayer.
The second aspect of that principle is that public sector compensation should be related in a reasonable and acceptable way to the private sector. We have to keep that as the guiding light. We cannot simply abandon those principles to appease workers in a particular area because, as I have pointed out on occasions in the past, it can have a detrimental effect. The member for Gander-Grand Falls never mentioned this aspect. On whether he knows about it or not I will not comment, but I will take two minutes to explain to the member what happens.
First of all, if you grant rates of pay that are out of context with the private sector in the regional area, you definitely create two kinds of havoc. First you will raise compensation for trades people beyond reasonable levels applicable to that region. You will have every plumber, every electrician, seeking employment in the public sector and leaving jobs in the private sector. The only way the employers in the private sector can compensate is by providing higher wages which increases the prices to consumers, that is the people of Canada, the taxpayers of Canada. They will pay more for services in their region because the Government of Canada has artificially increased compensation in trades and occupations in that area. That is number one detrimental effect that I hope the member for Dartmouth recognizes and realizes, because the member for Gander-Grand Falls apparently does not.
The second point is this: everybody agreed-and I am sure every member of the Liberal Party including their leader, House leader, and officials would agree-that the taxpayer of Canada is entitled to the best deal possible in terms of economies for government services. You have to face the fact that if the government can provide a service at less cost to the taxpayer in a certain way, then the government has some obligation to adopt that way of providing that service.
What does that mean in terms of compensation? That means very simply that if you pay higher rates than are justified in a region, the government will be paying more for the services it is acquiring.
If you pay painters at CFB Halifax more money than painters normally receive in the Halifax-Dartmouth area, you will raise the cost of painting in public buildings, or at least the buildings at CFB Halifax. What is the result of that? Painters in private industry will come to the government and ask: "Why are you paying so much extra to paint buildings in the Halifax-Dartmouth area when we can do it cheaper?" It does not make any difference what parliamentarians say. It does not make any difference what the member from Dartmouth says, because people in the private sector will come to government and say: "Why are you paying $1,000 or $10,000 or $100,000 extra for painting services in the Halifax-Dartmouth area when we can do it for less? We will employ people. We will cause industrial expansion and create local economic benefits and you do not have the right as the government to stop that".
When the member for Dartmouth stands up to defend what he calls pay equality, which means substantial increases in pay for people in his constituency and people in my constituency, I want him to say at the same time and at the same place: "You realize that in doing this we will be paying more taxpayers' money out than we need to pay and it will have a detrimental effect on the private sector". There will be painters, for example, in the private sector unemployed. There will be painting contractors without work because we have taken it upon ourselves to artificially raise levels of pay and to cause that havoc to occur. He has to take both sides of the coin.
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If I had my choice, I would simply sign an equality of pay order for the whole Public Service and let the chips fall where they may. Why would I do that? Because that is the easiest way out for me. That would make life easier for me. Just give it away. Give the employees what they want. Make them happy. They would be patting me on the back. They would be inviting me to their union meetings. They would be sending me Christmas cards. It would be wonderful.
However that is not my obligation as a representative of the public. My obligation as an elected member of Parliament is to do the right thing, to weigh all the factors and make a decision on the basis of all of those factors.
I have pressed time and time again in this House and in all channels and corridors of government for equal pay with persons on the west coast, and every time I have had my foot caught in a trap. When I stood in this House and other places and asked for equal pay with ships' crews in British Columbia, did they say: "yes, that is fine, thank you very much", when they got equal pay? No.
You can get equal pay simply by equalizing everybody's pay. You can reduce wages on the west coast compared to wages on the east coast and create equality. Does anybody want that? Has any union member ever come forward and said: "Look, we will use the same amount of money but we will equally divide it among us"? No, no, no, that is not the kind of equal pay. They are simply talking about an increase in pay. I understand that. I would like to have an increase in pay. I know they would like to have an increase in pay. Everybody would like to have an increase in pay, but we have to look at the political realities, at the economic realities.
When we raised the pay to equal levels for the ships' crews as the member for Dartmouth well knows-and I think I had a great part in that action-what happened? We simply gave Daryl Bean and the Public Service Alliance of Canada an opportunity to say that everybody should get that increase. The man who said he wanted equality of pay for ships' crews then turned around and said that everybody should get a similar increase right across the Public Service.
That was my sojourn into the area of collective bargaining. I am content to leave it now to Treasury Board officials because after that they reminded me: "See what you did. All you did was discolour the waters
Private Members' Business
of collective bargaining, of bargaining back and forth, by insisting on wage equality".
If the member for Dartmouth or the member for Gander-Grand Falls wants to step in there and disturb these relations, deal with them politically, not economically, not sensibly, then let it be on his shoulders. Let him ask for increases that are going to cause all kinds of turmoil. Does he think that painters at the dockyard are going to be happy with the increase they get if they reach equality without any effect on painters in other areas of the government, in other areas such as the hospitals which hire hundreds of painters and the private sector? No, it will simply cause a wage escalation.
While we would like to see equality, while we want to see fairness, we can only achieve that through sensible bargaining. The members at CFB Halifax in the ship repair unit know that, because I told them that. I told them that time and time again: "I will do what I can for you. I will advocate your cause, but we are up against a system that was brought into force many years ago by the Liberal government". It is okay for those Liberals on that side and the NDP to say they want pay equality. They not only denied pay equality in the Liberal term of office, but they refused to move toward equality. All I have ever asked them to do, and I told this to the representatives of the dockyard workers union, the ship repair unit, Jim Henneberry and his colleagues, that I would simply ask the government to move towards pay equality, to approach it and to keep it in mind as a goal or an objective to win.
Of course, we fought this all out in the 1988 election. We had parades and demonstrations. I never varied from my position. I told the dockyard workers exactly what my position was and I am telling them again today, for the umpteenth time, that I believe we want to work towards equality but we cannot reach it all in one jump. By the way, they accepted that position on December 6, 1988, when they accepted the pay increase. After rejecting it, they accepted the pay increase.
Jim Henneberry and his colleagues at the dockyard and labour leaders throughout the Public Service realize what is at stake here. They realize what principles are involved. If they can get yet another politician to come forward and say: "We want it now", I do not blame them for doing that. I think in their hearts they know it is something that has to be achieved through a gradual, evolutionary process.

September 23, 1991
Private Members' Business
I would like the member from Dartmouth to say: Work with me to try to move the dockyard workers and other public servants on the east coast towards equality. We are not going to get it in one jump.


Mr. Lawrence MacAulay (Cardigan):: Mr. Speaker, it is a pleasure for me to support the motion put forward by my hon. friend from Dartmouth.
The issue before the House is fairness. During the recent Public Service strike, one of the key union demands was the elimination of regional rates of pay. This is a system that discriminates against people on the basis of where they live.
Something has to be made perfectly clear. The elimination of regional rates of pay is not about equal pay for work of equal value. It is about paying people the same wage for doing exactly the same job for the same boss regardless of where they live. The federal government pays people a different salary depending on whether they live in Montague in my riding or Toronto or a community like Terrace, British Columbia.
The people who suffer the most from this unfair system are the people of Atlantic Canada and of course, the people of my riding of Cardigan, Prince Edward Island. Of the 17 job classes in the general labour and trade section of the federal Public Service, seven groups have their lowest rates of pay in Atlantic Canada.
We are not talking about paying somebody a few cents an hour more because the cost of living is much higher in Toronto. We are talking about paying an electrician in Souris, Prince Edward Island 20 per cent less than an electrician in Revelstoke, British Columbia, who is doing exactly the same job for the same boss but is being paid over $3 an hour less for doing the same job.
People in my riding would like to know where the fairness is in this system. I want to assure members that I have nothing against the people of British Columbia. The people of British Columbia are as honest and hard working as the people of Prince Edward Island.
The electrician in Prince Edward Island works just as hard as his counterpart in British Columbia, yet this government insists on paying the electrician from Souris,
Prince Edward Island, 20 per cent less. This problem not only deals with electricians, but it deals with boilermakers, tool and die operators, farm hands, plumbers, mechanics, carpenters and others, all who suffer from this discriminatory policy of the federal government.
I am not suggesting that the people in Toronto or Revelstoke should take a cut in pay and be brought down to the level of the people in Atlantic Canada or, in fact, the people of Saskatchewan who suffer the same discriminatory practices. Rather, I suggest that the people of Atlantic Canada, Saskatchewan and other places have their pay raised to the level enjoyed by their fellow Canadians elsewhere.
For years governments have been trying to do something about the lower standard of living in Atlantic Canada. If the government would take the simple step of raising the pay of the employees in Atlantic Canada there would be more money in the region.
Simple economics tell us if there is more money in the region, people will probably buy a new car, a new microwave or possibly extend their home which, of course, will stimulate the economy and get dollars moving. That is exactly what we need to have happen.
This week, we will be debating a new constitutional proposal from this government, a document which will outline the principles by which this country operates. One of the guiding principles of Confederation is that all Canadians are equal.
Many of our programs are designed to preserve this equality between people. Medicare ensures that all Canadians have universal access to the health care system, if it is not cut to pieces. Equalization ensures that the have not provinces have enough money to provide the same level of service across the country, again, if equalization payments are not cut to pieces.
Why then is this government treating Canadians differently on the basis of where they live? Two years ago when the ships' crews started negotiating for a new contract, they demanded an end to the regional rates of pay.
September 23, 1991

If you give me 30 seconds, I will wind this up as my time has run out. My colleague has explained the motion so I will not go through it. What I would ask the government to do is not to leave it to the arbitration boards, unions-


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

Pursuant to Standing Order 96(1), this item is dropped from the Order Paper.



GOVERNMENT ORDERS


Hon. John McDermid (for the Minister of Finance) moved: that Bill C-32, an act to amend the Canada Assistance Plan be read the second time and referred to Legislative Committee F.
He said: Mr. Speaker, I would like to move second reading of Bill C-32, an act to amend the Canada Assistance Plan. As part of the government's restraint program, this bill will continue the ceiling on the growth of the federal contributions under the Canada Assistance Plan to the provinces not receiving equalization payments.
Under the Government Expenditures Restraint Act passed last year, a 5 per cent ceiling on transfers to these provinces was set for 1990-91 and 1991-92. The legislation will extend those ceilings through to 1994-95.
Starting off this debate, I would like to remind the House that all Canadians and all levels of government stand to benefit from the wide-ranging measures that this government has introduced to put this country's fiscal House in order.
The federal debt we inherited in 1984, compounded by heavy interest payments over the last six years, represents one of the greatest dangers to this country's social and economic well-being.
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Canada's $400 billion debt burden and the deficits that add to it are a national problem affecting all Canadians. It results in higher taxes, inflationary pressure, increased interest rates and, of course, long-term uncertainty. Because interest costs are such a large share of the budget-$43 billion this year or 27 per cent of our total expenditures-the debt consumes funds that might otherwise be used to assist Canadians in need and to support programs Canadians want and reduce taxes.
In sum, Canada's deficit and debt represents a major threat to sustainable economic growth and the ability of this government, and of all governments across the country, to provide the social services that we are so proud of as Canadians.
To effectively deal with this program, we must get back on track in reducing the deficit. This is the threshold step, to get the debt under control and on to a downward path. Deficit reduction requires spending restraint. That is why we brought forward this legislation. It is part of a broad program of spending control needed to establish a positive, economic environment for the country. National problems demand national solutions. For this government to live within its means, spending restraint must be shared with the provinces. Federal transfers to other levels of government are simply too large to ignore in this effort.
Members of the House should bear in mind that for decades the federal government has provided considerable financial support to the provinces and that support, by the way, has grown significantly; by almost 6 per cent annually from 1984-85 to 1990-91. That is a much higher rate of increase than the 3.7 per cent growth in over-all program spending over the same period.
As a result of this growth, total federal contributions to the provinces, both cash and tax transfers, will reach nearly $37 billion this year. The cash component of these transfers will represent about 20 cents of every federal revenue dollar.
We simply cannot afford to let this spending grow without some limits. With this in mind, Bill C-20 has already been introduced to control the growth of Established Program Financing and to provide for other restraint measures outlined in the budget.

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Complementing this legislation, the bill before the House today would continue the ceiling on the growth in federal contributions under the Canada Assistance Plan to the three fiscally strongest provinces. Even with the measures that we are proposing, growth in federal transfers is expected to run at 3.7 per cent annually between this fiscal year 1991-92 and 1995-96 in contrast to just 3 per cent for all federal programs over the same period.
The level of CAP spending and the rate of growth over the past few years has meant that we cannot ignore this program as we work to contain expenditures. Since 1984-85, federal CAP contributions have grown at about 7 per cent annually from $4 billion to more than $6 billion last year. In contrast, total federal program spending has grown, as I mentioned earlier, at only 3.7 per cent over the same period of time.
Simply put, this government would not be a responsible custodian of the taxpayers' money if we allowed these contributions to grow without any restraint at all. We cannot spend our way out of problems with money we do not have and funds we cannot borrow except at a veiy high price for us today and, I guess more importantly, for our children tomorrow.
This bill has been carefully designed to balance our concern for needy Canadians and our desire to avoid placing unnecessary burdens on Canadians in the future. We know how important these dollars are in providing assistance to the neediest Canadians. We all know that in our constituencies as we experience it on a daily basis. CAP contributions help provide the most basic requirements of life: food, shelter and clothing, as well as social support in a variety of ways.
To me, the success of CAP is not measured by how many people are dependent on it, but by how many people it can help to regain personal independence. That is the important aspect of this. This independence would be worthless without a healthy economy and the jobs that go with it. It is to ensure the long-term health of the economy, threatened by the debt problem we have inherited, that we must put certain limits on the funds we give the provinces for these purposes.
Bill C-32 is part of a comprehensive responsible plan for fiscal consolidation and economic renewal, a plan based on the philosophy that has inspired this government since we came to power in 1984. We have reformed the tax system to increase its fairness and to improve the international competitiveness of our manufacturing sector. We have reduced waste and inefficiency in government operations. We have taken measured steps to reduce government spending so we can live within our financial means.
We continued our balanced approach to spending restraint even in the face of the recession we have just weathered. We kept to our course because we knew it was the only way to build a stable, long-lasting recovery.
We did not, however, embark on a wild spending spree as many of our critics demanded, especially the former premier of British Columbia, who would love us to just throw money at any problem and try to spend our way out of it. We have resisted the harsh calls from the other extreme, and that is to rip apart the social safety net on which many of our fellow citizens depend.
None of these steps we have taken compromise or will compromise our high, nationally consistent standards for health and social programs. Rather, they ensure that we will have a strong economy, that we will be able to afford these programs in the future and provide opportunities for those in financial difficulty to find independence and self-respect.
The balanced, prudent measures that we have taken, including those announced in the budget last February, will ensure that the deficit this year does not increase over last year, despite the effect of the recession that has just ended.
These measures, combined with economic recovery and lower interest rates, will push the deficit down sharply. For 1992-93, we are forecasting a shortfall of under $25 billion, the lowest in more than 10 years. By 1994-95, we will have eliminated the need for any new government borrowing on financial markets for the first time in 25 years.
During the recession of 1981-82, the government of the day chose a different path, allowing the deficit to balloon by $23 billion from 1982-83 to 1984-85, to a total

September 23, 1991

of $38.5 billion. It is this burden of debt that we have inherited, that all Canadians have inherited from the previous government that has made the legislation we have before us today so necessary.
I would like to assure the members of the House, and of course all Canadians, that the limits on CAP growth do not put this nation's welfare system at risk. The assistance provided under CAP by the federal government will continue to grow in every province. For seven provinces, no gross ceilings on federal contributions will apply. We will continue to match eligible spending on social assistance in these provinces dollar for dollar. In the three richest provinces, CAP contributions will also continue to grow but to a limit of 5 per cent annually. Even with the gross ceilings outlined in this bill, we estimate that during the five-year period in which the cap will be in place, federal CAP contributions to all provinces are expected to grow from $6 billion in 1990-91 to more than $7.3 billion in 1994-95.
CAP contributions to these provinces will continue to grow at a rate that is even faster than the growth in total program spending by this government.
As I am sure all members are aware, we have introduced legislation to restrain the growth in most areas of government spending to 3 per cent annually after the year 1991-92. The three affected provinces are those best able to share in the restraint necessary to build a stable fiscal foundation for this country's economy. Each of these provinces faces interest costs that are considerably less than those of the federal government, and these costs represent a much lower percentage of provincial spending.
For example, the national debt now totals $400 billion-equal to almost 60 per cent of the country's Gross Domestic Product. Interest payments will consume 33 cents of every dollar of federal revenue in this fiscal year
1991-92. In contrast, the combined debt of all the provinces will total about $113 billion this year, or 16 per cent of the Gross Domestic Product, and provincial debt payments will represent about 11 cents of every dollar of provincial revenue. In particular, these charges work out to 11.6 cents of every revenue dollar for Ontario, to 8.3 cents of every dollar for Alberta, and to 4 cents of every dollar for British Columbia.
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Before I outline the amounts transferred by the federal government to these provinces, and how these contributions will be affected by the legislation, let me briefly remind hon. members how CAP is administered.
Every month each province and territory sends an advance claim to the federal government. This amount is subsequently adjusted to reflect actual expenditures, and the over-all account is balanced at the end of the year. The annual claim is certified by an auditor designated by the province and accepted by the Department of National Health and Welfare.
While the federal government specifies the conditions under which a particular program is eligible for cost sharing, the provinces are responsible for designing and delivering the programs and ensuring their comprehensiveness. And it is up to the provinces, in this time of fiscal restraint, to ensure that every dollar of assistance is targeted at needy Canadians and not siphoned off by individuals taking advantage of the system. When program dollars are limited, stringent enforcement and monitoring of payments to eliminate abuses is a must.
The actual financial impact of the 5 per cent ceiling on the affected provinces will vary with its level of spending. I see the Liberals disagree with eliminating abuses to the system. The actual financial impact, I repeat, of the 5 per cent ceiling on the affected provinces will vary with its level of spending. We estimate that social assistance spending in Alberta has grown less than 5 per cent since
1990-	91. Consequently, we expect that federal contributions will continue to match the growth in Alberta's spending, dollar for dollar, for that year. The total federal contribution will be about $530 million. For
1991-	92 the federal contribution will reach some $565 million.
For British Columbia, it is estimated that the province will be entitled to about $50 less in federal contributions in 1991 than it would receive if there were no growth ceiling. However, federal contributions will still top $715 million and for 1991-92 they will grow to more than $750 million.
Ontario will receive in 1990-91, $2 billion-about one-third of the total federal CAP contribution. This amount is about $450 million less than it would be if there were no growth ceiling. For 1991-92 Ontario will receive $100 million more for a total of $2.1 billion; by any measure a lot of money.

September 23, 1991
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By taking this measured step we are seeking to live within our means-and the means of the Canadian taxpayers because they are the ones who foot the bill-while still ensuring that those most in need are fully protected. The financial discipline that we are asking for is essential if we are to reduce inflation further and interest rates. It is only in this way that we can strengthen the economic recovery that has already begun.
The fiscal responsible approach we have taken offers the only way that we can generate productive long-term jobs and ensure renewed sustainable prosperity. It is the only way to bring down inflation and create a positive environment in which all Canadians can confidently plan for their future. And it is only by ensuring that we have a prosperous Canada with a sound financial foundation that we can maintain a strong social safety net for Canadians in need.
As announced in the budget, there is a review of all major federal transfers to provinces under way with an eye to improving their effectiveness and tailoring them to the changing needs of the 1990s.
As part of this co-operative agenda the Minister of Finance will be meeting with his provincial counterparts again later this fall. Our goal is to maintain the principles and standards that are the basis of Canadian citizenship, while at the same time respecting provincial flexibility and tailoring services to best meet local conditions.
We are undertaking this consultation not because we lack a strong, positive vision of what needs to be done nor because we lack ideas on how to regain our fiscal balance. Rather, we recognize that for these ideas to be effective they must reflect the shared vision and mutual commitment by all levels of government and by all Canadians.
On the fundamentals of our discussion I am sure there is already full agreement. The success and permanence of Canada's social programs depends on the wealth and prosperity of the country as a whole. I need not remind my fellow colleagues that prosperity cannot be legislated.
As well, I am sure that all members of the House agree that the best assistance for Canadians in need is
meaningful, permanent jobs, and job creation through sound economic management has been a priority of this government from day one.
The government's restraint efforts are even now showing results. The economy began to turn upwards in the second quarter of this year and continues to grow. We are expecting Canada to finish in second place among the G-7 in economic growth in 1992, with a growth rate of around 3.5 per cent.
The positive signs of growth we are now seeing are a source of encouragement, but we are all well aware that many Canadians are still experiencing the effects of this past recession. Without a doubt, we still have work to do to ensure that economic growth continues and that the recovery is sound and long lasting. If we waver, if we let the deficit rise, inflation and interest rates will follow, choking off growth.
We do not intend to let this happen. We have already laid the groundwork for sound economic growth and, if we were to listen to our critics, we would squander the sacrifices Canadians have made so far.
There are no quick, painless fixes to the deficit and debt problems we have inherited; only difficult responsibilities that we owe to Canadians. The extension of gross ceiling on CAP transfers flows directly from those responsibilities. I urge all members of the House to support this motion and to join us in accepting our fiscal responsibility to all Canadians.


Mrs. Sheila Finestone (Mount Royal):: Mr. Speaker, I listened with great interest to the speech by my colleague, the minister opposite. What this government and what some of these comments have shown is that the government has not understood that reducing a deficit is not a social or fiscal or economic policy, but a policy that will affect the lives of average Canadians across this country. You cannot replace a fair and satisfactory social policy that prepares looks to the future with a policy that merely reduces a deficit. A government worthy of the name would try to achieve a better balance between economic and social objectives, objectives that are worthwhile, and this means not only acting responsibly, as the hon. member just said-
September 23, 1991



-about not compromising the health of the community, not compromising the economy, finding the way in which one would deal with the deficit.
I listened very carefully to this minister. He talked about the fact that prosperity cannot be legislated. That is true. But prosperity can be foreseen by proper economic policies, fiscal policies and social policies that are married and interrelated one with the other so that we end up with a country prepared to face the future, not frozen in the ideological mould of this particular minister who cannot seem to see beyond the dollars and nuts and bolts of a supposed dollar economy without looking at the people who make up that dollar economy.
I listened with great interest to better understand this government and to find out how this government was going to reconcile its general economic policies with its social policies, with its political policies, with the state of the nation, and in particular with respect to this Bill C-32; this policy of the government with that of keeping this country united, with helping the underprivileged, the underemployed, the unemployed and the poor in particular adjust to the changes that are taking place both interprovincially and internationally in the trade area.
This bill is supposed to deal with the poorest in our country. That is the goal of this particular bill. Whoever wrote the speech for the minister seems to have forgotten what the goal in this bill was all about.
I was curious and hopeful that the current political agenda be not totally dominated by our constitutional arrangement of where, what, and who sits in which rooms of our house. That is important to be sure, but the house is for the people, all people in all stages of their lives as they journey through life.
It is for the people in this house, in our house, which is covered with a common roof, a common set of practical values and that we build the foundation for a solid country where we are going to manage our house for all the people as they move from room, to room, to room, or whether they moved upstairs or downstairs as the world changes around them both inside and outside its borders.
The taxpayers' pocket is one pocket. The federal government in lauding how it has cut its deficit just completely ignores how it dumped that deficit on to the provinces which then subsequently dumps it into the
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municipalities. The long-term effect of that is that the same person has three people tearing at its pockets if he or she has any pockets left at all from which to pay the taxes.
Peoples' needs, economic and social, cannot be sidelined with the level of unemployment at 10.6 per cent and higher in certain areas-certainly higher in Montreal-with the level of the underemployed, with youth and immigrants feeling rejected, neglected and depressed, and even with those highly trained and highly educated who cannot get jobs, who move around looking for work. They move to those provinces which seem to be the provinces of higher prosperity: Ontario, Alberta, and British Columbia. They have had the major burden to bear of people looking for jobs as a result of this government's very poor policy.
How government runs and manages its economy has and will have a great impact on how we will want to keep that roof over our heads as a nation. If this is nation building according to this government, I think it is a pretty sad beginning to a very important week in the history of this country.
My theme is one of economic and social policy which go hand in hand; one complements the other. They are not mutually exclusive, and this is what this government does not seem to understand. Given the made-in-Cana-da recession, high unemployment, the free trade agreement that has severely dislocated our manufacturing base, the goods and services tax, and the unemployment insurance changes, provincial social assistance case loads are increasing at a much faster rate, particularly in the three affected provinces where people moved to find jobs that have now disappeared.
I have had some experiences about the impact of this government's fiscal policy. I have seen the street people in Montreal. I have seen those who sleep on the heat outlets, in the doorways. I have seen those who go to a place called Chez Doris-and there are places like Chez Doris everywhere across this land-and other centres where they get a meal. Sometimes they are lucky enough to get a bed. Believe me it touches our hearts; not that minister's but most people in this country. It raises questions in our minds. These people are the visible testimony and the example of the holes that we now have in our social safety net due to the poor policies we have seen from this government.

September 23, 1991
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Mr. Kilgour:: I rise on a point of order, Mr. Speaker. After last week you would think that the minister of fisheries would know better than to say, as he just did, "silly woman" to the speaker on our side of the House.
I would ask that you rule on whether that is a sexist remark made by a donkey from Newfoundland, if I can put it that bluntly.


Mr. Crosbie:: Mr. Speaker, the hon. member should get his facts straight. I have not opened my mouth or said a word about anyone whether they are silly or not silly. So his statement is completely false and should be withdrawn.


Sheila Finestone: Not only did you call me silly, you called me stupid. I think you should think about what you are saying. It degrades you and this House.


Mr. Nunziata:: Mr. Speaker, I, along with other colleagues who are sitting here listening to the member for Mount Royal speak, distinctly heard the member for Brampton, in a very condescending way, refer to the hon. member as a silly woman. He would not have called a male member of Parliament a silly man. He said so in a condescending way.


An hon. member:: And you are a silly man.


John V. Nunziata: He also referred to the member as stupid.
I would ask, Mr. Speaker, in view of what has transpired in this House over the last number of days, that you take immediate disciplinary action and require that member, who is also a minister of the Crown, to apologize to this member immediately.


The Acting Speaker (Mr. DeBlois):: I ask the collaboration of all hon. members because some of the words said in this House cannot be heard by the Speaker.

And I am sure you realize that the Speaker cannot- A lot of inaudible remarks are made which I can't hear when the microphone is closed. Consequently, I would ask both sides of the House to co-operate so that debate can resume in a spirit of harmony. If any members would
like to withdraw or correct their remarks, they may do so, but so far I have not heard any unparliamentary language as defined by Beauchesne's.
The member for Mount Royal has the floor. [English]


David Kilgour: Mr. Speaker, I would like to apologize, without equivocation to the minister of fisheries. He is seated about three metres away from the minister from Brampton. You, sir, and I are seated about four metres apart. I heard the expression very clearly, but I am advised by members in my party that it was not the minister of fisheries who made the comment; it was the minister from Brampton. I would submit, sir, that it was audible to you, Mr. Speaker, and this side of the House.


John V. Nunziata: Mr. Speaker, whether or not the Chair heard the comment, I would submit to you is not relevant. Those words were spoken. Members on this side of the House heard the words distinctly. The member has not denied making that condescending reference to my colleague. I would submit, Mr. Speaker, that just because the Speaker does not happen to hear a condescending expression from the member opposite does not mean that it did not happen. We heard it and we would ask that the member apologize.


The Acting Speaker (Mr. DeBlois):: I repeat that Hansard will show what was said, and for the time being, although the Chair did not hear the remarks, it reserves the right to check Hansard for additional information of the kind mentioned by the hon. member. Meanwhile, I may remind hon. members that in the House it is customary to take members at their word, and for the time being I consider the incident closed, subject to more extensive checks as soon as Hansard is published.


John Horton McDermid: Mr. Speaker, I do not deny making the statement "that was silly" and "silly woman". I also called her mate across the hall a silly man as well, because his statements were silly as well.
I apologize if I have offended the hon. member. I am not sure that I did, but she accused me of not caring for the poor.
September 23, 1991

Anybody from my constituency who knows my work in Brampton for those less fortunate than the rest would absolutely deny that. For her to make a statement like that in the House is silly.


The Acting Speaker (Mr. DeBlois):: I would ask the hon. member to co-operate. I think that what the minister just said should normally be considered to close the incident.
The hon. member for Ottawa West.


Mrs. Catterall:: Mr. Speaker, you had ruled the discussion closed, but since it has been reopened by the last point of order, I am going to intervene at this point.
Until now, only men in the Chamber have spoken on the intervention by the member, and frankly it is only women who can feel the sick feeling in the stomach when our gender happens to be a factor in our performance and in how our words are received in this House.


The Acting Speaker (Mr. DeBlois):: I am sorry to interrupt the hon. member but members cannot do indirectly what they are forbidden to do directly. After the minister's remarks, I consider the incident closed, and I suggest we resume debate.
The hon. member for Mount Royal.


Sheila Finestone: Mr. Speaker, the fact that I am offended, the fact that it is an offence that gender is always pulled in by some members in this House and the fact that this person happens to be a minister of the Crown, I think are to be taken into consideration. I am glad you are going to review the tapes and then make a decision.
With respect to Bill C-32, the act to amend the Canada Assistance Plan, we must consider our concerns about the deficit in far greater balance with the longterm social needs that Canada faces.
We are not here cleaning up a corporate balance sheet for an upcoming annual meeting. This is a country that we are building for the long term.
The Canada Assistance Plan was created in 1966 to permit the federal government to enter into cost sharing agreements with provincial governments for the provi-
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sion of social assistance and social welfare services for Canadians in need.
CAP is one of the major cornerstones of the social security system in Canada. This program is a reflection of our widely shared values that are at the root of our political culture.
CAP is a service of last resort. It is one to alleviate poverty. The bottom line is that this federal government is abrogating another sacred trust of Canada's social programs. It abrogates this trust by amendments in a small, two-page finance bill.
It has violated the spirit of federal-provincial co-operation which has marked the 24-year history of CAP, and it acted unilaterally for the first time in the history of CAP.
This bill is a companion to that nefarious bill, Bill C-69, which was so capably analysed by my colleague, the member for Winnipeg North Centre. I hope he is feeling much better today. We miss him.
The CAP cuts were just a giant leap backward. It is an unwise, short-sighted counterproductive policy. It is not smart economic policy, which I will debate later.
CAP was designed to address the consequences and causes of poverty due to illness, disability, family breakup and unemployment. It was to be quite simply Canada's war on poverty. CAP allowed Canadians to share in the benefits and obligations of common nationhood and to strengthen their identity within Canada.
What does this bill do? It reaffirms the agenda this government has been pursuing for seven years now, which is to attack the fundamental social safety net of this country that has been established over decades, to pursue a financial debt and deficit reduction in a clearly unbalanced way, ignoring the tremendous social debt and deficit we also face in this country.
Yes, fiscal responsibility is one objective, but along with good social policy we can get a balance. Good government requires a balanced pursuit of both economic opportunity and social justice.
This bill, introduced under the Minister of Finance, implements a measure announced in the 1991 budget and will drain the federal government contributions to CAP by billions. The federal government admits this. You heard it in the speech today; it will save billions in federal transfer payments to the affected provinces over five years, through 1995-96. It will contain at most 3 per cent any potential growth that may be required as we have to restructure and face the internationally competi-

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tive world. As I said before, it dumps more responsibility on to the strained provincial budgets. You cannot get blood from a stone. The affected provinces, Ontario, Alberta and B.C., for their part, expect the actual lost dollars to be much higher than what this government has stated. We know how often the Minister of Finance has had inaccurate predictions and has had to correct them after the fact.
The provinces affected by this restraint measure are home to about 46 per cent of the poor families in Canada. Fifty-four per cent of all welfare recipients under CAP live in those provinces; 40 per cent of those receiving welfare payments are children. It is they who will suffer.
Who are the people most affected by this bill? Who suffers the most when government fails to take its proper economic and social responsibility, in balance with deficit concerns, not outside of it? It is the children of this land. If Canada wants to have a strong, creative society tomorrow, it must invest in its children today.
The federal government continually says that it wants to target social programs to the people who are most in need. The capping of CAP will do the exact opposite. It will take away help from the people who need it most, our children. Not only is this inhuman, it is not smart economic policy. To create a productive society and a sound economy tomorrow, we must provide today's children with the tools they need to be creative, contributing citizens. That is why Bill C-32 is entirely counterproductive.
That is why we say, along with the deficit concerns, that we have to balance them with the long-run social and economic goals of this country. That means investing in our children, not cutting back the tools with which they need to live and to prosper in this country.
It is not only children. It is young adults, university students and immigrants who have come here for a new life. It is the whole gamut of underemployed, unemployed and those who fall outside the social safety net who need our help.
The result is that the majority of the most vulnerable people living in this country are very hard hit by this measure. This bill brings into question this government's lack of morality in not treating all Canadians, wherever they live, fairly and equitably.
Of course, the impact of this bill must be added to a similar measure passed as part of the 1990 budget, known as Bill C-69, which cut the growth of the same CAP transfers through 1990, 1991 and 1992 for these three provinces. That nefarious bill, put through on closure, also accelerated funding cutbacks for medicare and post-secondary education to all provinces, jeopardizing the ability and quality of those programs across Canada. In that bill, federal money paid to the provinces for these programs are reduced each year from the 1989-90 level of about $9 billion to zero by the year 2004. However, this government wants us to believe it is taking care of and looking to its responsibilities in building a nation in containing and enhancing this country.
Would you mind telling me what the federal government is targeting for cuts with this measure? I will tell you what they are. Under the CAP plan, the federal and provincial governments share equally in the cost of basic necessities, such as food, shelter, clothing, utilities and household supplies needed by those most in need and the most needy in our society. Only a Conservative could question that these vital programs are luxuries or frivolous or are misused, but that is the conclusion from C-32. That is the conclusion from what this minister's message was this morning.
Under CAP, services are provided for children who are in care or are in need of protection due to abuse or neglect, mentally and physically disabled people, one parent families, the aged, the unemployed, families or individuals in crisis, low income workers, battered women, and rape crisis centres. Do these people sound like the kind of people with the luxury of tightening their belts, as the Minister of Finance keeps saying and keeps espousing? CAP services include essential living services for disabled persons, foster homes for abused children, safe housing for abused women, subsidized child care for low income families and dental care.
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Many Canadians agree with financial responsibility in government, but do these sound like programs where federal dollars are being squandered or wasted? Hardly I would say. It would take a Conservative to think that way. I would suspect that most Canadians would agree with me.
The restraints in Bill C-32 are bad enough in their own right, but they also confirm once again to this whole country that this government's approach of attacking the most vulnerable of society seems to be a mindset with them. It reminds those at the bottom of the income ladder that Tory times are very tough times. It tells those who today must look to government for a hand to get in line behind this government's crusade against the deficit. It says once again that this government will pursue the deficit problem alone and above all others.
As important as it is to address the deficit, it is only half the answer for a strong, competitive, productive Canada for tomorrow.

In the early 1990s, we have good reasons to fear the destruction of our social safety net, due to this Conservative government's approach.
Indeed, since 1984, this government has pursued a legislative and fiscal agenda that breaks systematically and radically with the traditional values and priorities of our country. For example, we can mention the abolition of universality for family allowances and old age pensions, which are now a thing of the past for thousands of beneficiaries who have to pay them back on their income tax.
There is no doubt that many of my constituents in Mount Royal agree with this observer who said recently that the government seems to have shifted responsibility for social programs from the Department of Health and Welfare to the Department of Finance, which does not have a reputation for very advanced social thinking or for being the government's conscience. Only now, after seven years of this Conservative government, do we start to realize the consequences of this decision to entrust our social policies to economists, lawyers and tax specialists in the Department of Finance.
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The government has not yet understood that reducing the deficit in itself is not a social policy.

This government's record in a relatively seven short years stands as a clear rejection of Canada's proud record in advancing the cause of social justice and enhancing our social safety net as a symbol of a caring and just society. Just look back. The forties brought the Unemployment Insurance Act, universal family allowances, the National Housing Act, Central Mortgage and Housing, all steps and all measures to decrease the gap between the rich and poor in this country, something this government has managed to increase.
The fifties also extended the social safety net in this country, including income security provisions for the elderly and for the disabled, 50 per cent cost sharing with the provinces for social assistance payments and a share in the cost of provincial hospital insurance programs. But this is all weeping lilies and weeping willies. According to this government, this is not good social and economic policy for a country. We must have deficit reduction at all costs, it says.
The sixties brought the Canada Pension Plan, old age security, guaranteed annual income and the CAP plan, the Canada Assistance Plan. Through the seventies these programs delivered to Canadians the kind of society they wanted and believed in. The early eighties continued this trend with the Canada Health Act, reaffirming universal medical coverage and an end to provincial extra billing.
Who would argue today that those were not good steps for Canada and every Canadian? Certainly not our Prime Minister. He thought they were wonderful, that they were a sacred trust. Yet this government appears to believe its greatest achievement has been in reversing this proud record and often in sneaky, back-handed sorts of ways. It is never through the front door, never as a policy choice during an election.
This government has seen fit, since 1984, to attack Canada's achievements as a country instead of pursuing a balanced agenda between economic opportunity and

September 23, 1991
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social justice. It is an attack that continues through this small two-line bill, Bill C-32.
Canadians will remember the regressive steps taken by this government, cuts to medicare and post-secondary education through the EPF restraints, clawbacks of old age pensions and family allowance benefits, removal of the interest income deduction from the income tax form measure which so helped our seniors, cuts to unemployment insurance programs which affected every part of this country, special fees on student loans that make the burden of education even higher, deindexation of the child tax credits, abandonment of child care, not once but three times, and cuts to housing programs. The list goes on and on.

This bill is only another in a long list of initiatives affecting our social programs that this government has put forward in recent years in the name of budget restrictions and deficit reduction. However, this bill is very representative of the government's short-sightedness in choosing to ignore the many real problems facing us, in order to concentrate all its energy on reducing the deficit.
When I see ministers get out of their luxury limousines in the morning, I tell myself that at the same time hundreds of thousands of Canadians have also got up but cannot go to work as before because they no longer have a job. They are unemployed, thanks largely to Brian Mulroney's government.

This government, as the ministers opposite are whisked off to work, just does not consider that there are families in turmoil out there, families that cannot pay their bills. They are losing their homes. They are sending their children off to school hungiy and they are losing dignity and hope.
This government thinks it is doing the right thing. At least, it has a philosophic bent that seems to be frozen. This government appears oblivious to the plight of the beggar on the street. It is oblivious to the family slipping below the poverty line. It has little feeling for the family that cannot adequately feed and clothe itself.
It is demonstrating all of this in this small little bill. Its aim is to limit the benefits to those in this country who
need help the most. I have told you that 40 per cent of the people being hit are children. These are the people whose children need clothes, bread on their tables. These people want desperately to work, and yet deficit reduction is the top priority of this government. It is important that it be a priority, but not the only one. The Prime Minister has said it is. The last Minister of Finance said it was. The new Minister of Finance says it is. This minister-I do not know of what-says it is.
What the government has not learned is that deficit reduction is not a social policy. Yes, you can ensure that good financial management is among your goals, but it is just one. You cannot substitute good, sound, forwardthinking social and economic policies with only a policy of deficit reduction. You cannot simply use deficit reduction as an excuse to do nothing. You cannot ignore the need for adjustment programs and for sound restructuring policies to ensure a productive, competitive work force in the new global economy.
Good government, to me, requires a vision for people, a plan that puts in place a commitment to that plan that really makes it work. Good government always requires a more balanced and broader approach.
This government has failed to learn that you have to consider, along with the country's economic and financial deficits, the tremendous social debt and deficit that we face now and which will become worse in the future if we do not do something about it now.
These social debts and deficits, whether in education, whether sending a child to school hungry, whether if ignored will grow and be exacerbated in the long run by a narrow vision and no foresight by the government opposite, are the real fundamental issues. We cannot abandon social targets and social policy goals in order to accommodate some sort of blind, narrow-minded view that the deficit should be our strait-jacket.
This government has made the mistake of not forging a balanced approach. This government's economic agenda has stolen from Canadian families any real improvement in their fiscal situations and created massive unemployment. It then makes the poorest in our society pay for it and pay the biggest cost. It then tries to give us an argument that it has created jobs, jobs, jobs, and that it is thinking of the future and it has good plans. It is funny nobody can see it but the government. It is like the emperor without the clothes.
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By itself, the deficit reduction policy favoured by this government cannot solve our problems and meet our many needs right now in research and development, education, manpower development and retraining. Well thought out and well considered policies are what is needed now. We cannot address appropriately the market's structural problems nor ensure the much needed competitiveness of our manpower on the world markets with inadequate programs. This obsession with deficit reduction does absolutely nothing in terms of improving the skills of a single Canadian worker. This fixation does nothing either for all those people who stand in line at soup kitchens, food banks and shelters for the homeless.
What is needed to address the most urgent of our social problems are clearly defined and effective policies that blend with our economic policies and are just an afterthought.
If we want to build a caring and compassionate nation then people must come first and priority must be given to those in need the men, women and children of this country at the same time as we address the deficit. That is what slipped their minds, they forgot to take that into consideration.
This government believes that we can afford the luxury of waiting until the deficit has been eliminated before considering any assistance to the million and a half unemployed in this country. I say to this government that they are wrong, dead wrong, that we cannot afford such luxury. They also think that they can remain unruffled. Does all that misery not bother them? They concentrate exclusively on the deficit while a growing number of Canadian men and women have to queue up at food banks and while in greater number they have been reduced to begging to survive. Fewer and fewer Canadian children can dream of having a decent future. Their poverty is not only physical but also moral, since they have become hopeless.
I am telling the departments and the ministers who are here today: you are making a mistake. You have strayed. You must get back on track and understand that your
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first obligation is not to beat the deficit but to take care of the people you are responsible for. These two responsibilities should be better balanced. One is not exclusive of the other.

This government mistakenly believes that blindly paying attention only to the deficit will somehow magically stop children from having to go to school hungry each morning. It will not. Will it find shelter for the homeless? It will not. I simply say that we do not have the luxury of playing which comes first, the deficit or the strengthening of the social fabric of this countxy and the upgrading of the skills of its people to face the international and interprovincial trades that we require in this country. It is a trade-off this government is making every day and it is totally unacceptable.


Mr. Boyer:: Did you like the announcement 10 days ago about the disabled?


Sheila Finestone: You did a few things right, Patrick. I did not say you did everything wrong, but very few things. The disabled in terms of housing are not particularly happy. Come and speak to the disabled and those who are in charge of housing in my riding. Find out what they have to say about the degree and the condition of the infrastructure and the apartments and the housing which you have stopped financing.


John Horton McDermid: This is a provincial responsibility.


Sheila Finestone: Oh, dump it on the provinces again. If you did not keep cutting, the provinces would have the money to do it.
I read the Constitution very well. It is too bad you do not know how to read the Constitution. Your first try was very ineffective. I hope the second one will be much better. We are all hoping that.
While this government is focused so blindly-Mr. Speaker, I will take it up again.


The Acting Speaker (Mr. DeBlois):: You have seven minutes left.

September 23, 1991
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Sheila Finestone: Do I have it left now or after? Plus tard ou maintenantl
I know I have discomforted the people opposite, some of the ministers, the minister who is in charge of fisheries out on the east coast and the west coast; the minister who was once in charge of transportation, which is now totally dishevelled and upset. A number of these ministers have recommended that we go through belt tightening, and it is slipping from belt tightening to a belt around the neck for millions of Canadians, choking them now and maybe permanently.
This government uses rhetoric of equality to mask an agenda that widens the gap between rich and poor, through arcane tax changes and the slow elimination of publicly funded programs. This is not acceptable.
In the end, what is this bill? It is one more instalment on the Toiy agenda which Canadians have been living with for seven years. It is an agenda which has as its main focus a sort of blind, narrow-minded preoccupation with the financial debt and deficit, ignoring the social debt and deficit. It is one in which market forces alone are supposed to carry the day and in which survival of the fittest replaces the goal of a caring, compassionate Canada and a more just society.
The result has been an era in Canada in which tremendous social and infrastructure needs have been ignored. The message is that we in Canada have always had a balanced agenda. I suggest that in the end Canadians will agree that deficit reduction fails miserably as constructive social policy or a social policy of any kind.
The total debt and the annual deficit are to be treated in a most serious way. They are real problems. There is not much room for fiscal manoeuvring if that is your only concern. However, relative to other industrial countries I would remind you that Canada spends a much lower percentage of its GNP on social programs. I also think that Canadians agree that you cannot substitute deficit reduction for policies that actually help people.
I do not think that Canadians like the image of people lining up at food banks, of people needing clothing, of people being homeless, of people being hungry. That is the other side of the reality facing this country every single day.
My last words with respect to this national government is that it should start to reflect the concerns of the people and respond to their needs. That is why it was elected. This bill fails to reflect the true needs of
Canada. It reaffirms this government's failure at balancing deficit concerns and our economic and financial deficit with social concerns.
Do not forget that losing a job is for many people a sort of death sentence. The dignity of the unemployed who do not have the choice of working and earning their living honourably is removed.
Mahatma Gandhi was once asked what he thought of western civilization. He paused, and then he said: "I think it would be a good idea". This government would do well to consider a more civilized approach, one that takes into account the concerns I have outlined and accepts its social responsibilities.
I would recommend the government take its ideological blinders off, withdraw Bill C-32 and go back to the drawing board so that Canadians might be again able to look to their national government as a true reflection of the values we share as a people.
It has a fiduciary responsibility for the poorest in this country. That is what the Canada Assistance Plan is all about and that is what it should have done; a more equitable place in society where economic, fiscal and social concerns are part of the national agenda.
I finish with three thoughts. What this government has not learned is that deficit reduction is not a social policy, that to survive in the international and national arenas, we must restore a sense of balance between economic and social goals on our national agenda if we want to build a nation. You cannot substitute good, sound, forward looking social policy with a policy of deficit reduction. Good government always requires a much more balanced approach between economic and social goals for our nation.

I would have repeated this in French had I had the time, Mr. Speaker, but I think that I made it clear and that others will have to repeat it time and time again to make this government realize it has made a mistake and it is going the wrong way. I certainly hope that this country will survive, in spite of the way it is managed and the decisions this government has made.


Mr. David Barrett (Esquimalt-Juan de Fuca):: Mr. Speaker, I am pleased to be able to participate in this debate. I want to thank the previous speaker for presenting her party's point of view on this current situation. Many of her comments I agree with. I think it is important that we hear all sides on this issue, but I know
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the government will have its way with this legislation, as it does with its overwhelming majority.
A lot of curious things are said during a debate to bolster an argument. I want to go over a couple of things said by my good friend, the member for Brampton. In making his point the minister said that the servicing of the federal debt took 33 cents of every dollar that Canadians contribute to governments. Then he went on to explain to Canadians why three provinces were under the cap, Ontario, Alberta and British Columbia.
I can speak certainly for British Columbia, but I wanted to make just one observation which seems to be a bit paradoxical about Ontario and perhaps some people might think hypocritical. Since I am in politics I understand the difference between hypocrisy and paradox. Perhaps the Chair could explain how it views it.
In suggesting that the federal government is burdened with having to put 33 cents of every dollar on to the federal debt and rationalizing why there was a cap on Ontario, he said: "They only have to pay 7 cents for every dollar of debt". How can that be when the Prime Minister of this country has gone around scorching the Government of Ontario for its deficit extension of $9 billion when this government is going to have a deficit of $35 billion this year and yet admit that it is paying more than four times per year to service the debt than what Ontario is? Hypocrisy or paradox?
I think the member has been attacking the Prime Minister behind the Prime Minister's back, going around saying that Ontario is paying one-quarter of the debt servicing even though it has a deficit this year that is going to serve people, while it is cutting services to people and paying 33 cents per dollar. Hypocrisy or paradox, Mr. Speaker, I leave it to you to judge.
Second, when this government came into office it said that it was going to campaign to cut the deficit, cut the accumulated debt of this country through deficits. When they came in the deficit was a little over $100 billion.


An hon. member:: Two hundred billion.
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David Barrett: Yes, $200 billion. They have managed to double it, more than double it, in the time they have been in office.
My friend is quibbling with me about what the federal deficit will be this year. I said $35 billion and he says $30 billion. What was the name of that famous cabinet minister who said: "What's a million?" C. D. Howe said: "What's a million?" These guys say: "What's five billion?"
There is a $30 billion deficit. They have doubled the national debt since they have been in office, and they have the gall to come in here and lecture people on how tough it has been for them to double the debt and the deficit.


An hon. member:: All interest.


David Barrett: All interest. Now we get to this cry-all interest. If they wanted to avert some of the problems of internal interest, why in the world did they maintain the high interest rates that were bleeding Canadian businesses, Canadian citizens and Canadian taxpayers in accumulating this debt? Then they come in here and say: "Well, it was all interest". It is like the person who goes out and kills his mother, kills his father, and then goes to court and pleads for mercy because he is an orphan. I find that kind of logic frankly absurd, but it is Tory logic. They are on this maniacal drive to cut back services to people on a right wing agenda that Milton Freedman would applaud. It has gone so far that they make Margaret Thatcher look like Florence Nightingale when it comes to services in this country.
I want to tell you that the absurdity, the paradox and the hypocrisy of this government show no limit. But there is a tender heart in this government's body for one sector of the community. Let us hear it, Mr. Speaker, for the downtrodden corporations of this nation that have been so oppressed under a previous Liberal government, which had a bit of a social conscience-not enough, but a bit of a social conscience. But let us examine the record of this government when it comes to fair share in taxes. Oh, squeeze the little guy, squeeze the GST, cut back in provincial transfers, but let's take a look at just one year with corporations under the Conservative government.
These corporations never have to go in front of a social worker, never have to show what their food budget is,

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never have to show what their housing allowance is. They just go on a wink and a nudge between the corporations and this government.
Using the government's own statistics, because I find them convenient, I want to point to just one year, 1987. These figures are from Statistics Canada, before the minimum tax, when you were piling up deficits. Then you were adding to the debt, then you were pouring it on to the debt. You called the Liberals all kinds of names, names that I could agree with for I am not a Liberal, but at least have some decency to admit the names you were calling them had no foundation in fact when you come to this part, of how you have messed up the economy of this country as my colleague said through the GST, through the free trade agreement and now capping the provinces.
I know there are a lot of Canadians out there who will never vote Tory again after I read this information from Statistics Canada. As a matter of fact, there are very few Tories left. Has this government ever pondered why they are at 16 per cent in the polls-16 per cent in the polls? The Canadian people are telling them that they are fed up. Here are some of the reasons why.
I am glad the member is here, and I will send him my autographed notes after because he wants this material to back up his speeches.
In 1987 they had 362,828 corporations that reported $87.7 billion in profit. Now of course that was before the minimum tax. The effective tax rate at that time was supposed to be 36 per cent. That is right. Thanks to a leaky system the effective rate of taxation of these profits was 17.7 per cent. A net of $15 billion was payable. They did not pay their fair share then. They are not paying their fair share now. If we are going to pay down the debts of this country piled up by an insensitive stupid Conservative government, at least make it a fair share. The corporations still are not paying their fair share.
Let me go further, Mr. Speaker. The best is yet to come. Despite combined profits of $25 billion, fully
118,000	corporations, or about one in three, paid no corporate income tax whatsoever. When the debt was piling up because of fiscal policies that were frankly so right wing it made Milton Freedman embarrassed, they were still letting the corporations off the hook.
Tell that to the mother on welfare when she cannot feed her two kids and has to line up in the food bank. Tell that to the unemployed in Montreal and the shopkeepers who have had to close up in downtown Montreal. Tell that to the prairie farmers who are trying to eke out a living at the lowest price wheat in history since the 1930s. Tell them you could not hit the corporations while they
were piling up the debt. There were billions and billions and billions of dollars in favouritism to those corporations, while the average Canadians had to carry the can for their stupid fiscal policies.
Who piled up $400 billion in debt? They did. Who is it that is causing us to pay 33 cents on every dollar on debt charges? They are. Who is it that attacks Ontario because they pay 7 cents on every dollar? They are. Who are the hypocrites, Mr. Speaker? I ask you to ponder that question. I only raise it as a paradox.
I find it less than amusing that this government forces that poor unfortunate minister into a position of defending a policy that is another cut at Canadian federation.
If you want to keep this country together, Mr. Speaker, the way is first of all to come clean about how the debt was accumulated.
Who was responsible for these fiscal policies, and how we are going to get out of it? It is not good enough to come in here and suggest that three rich provinces have to carry more of the can while the other seven do not. We all agree with that. When we bound ourselves together as a nation in Confederation we said in good times in some regions; we would share bad times in other regions.
There is not a taxpayer in this country who would not at any given time understand the need to share right across the board. Under the former Liberal administration there was a move to put a cap on health care spending, to put a formula in on the richer provinces. Ten premiers met with the then Prime Minister and in concert they rejected the formula and went back to the standard concept that a Canadian is a Canadian is a Canadian, and in good times we share and in hard times we expect to be shared with. That concept is being destroyed by this bill. Amid all the flimflam about constitutional debate and regional concerns, this government has made a mess of the economy. They have piled up huge deficits, accumulated debts in this country, and now they are going back to the ordinary people, not the corporations, and saying: "You carry the can". Some regions have to carry it more than others.
Nothing could be more divisive. Nothing could be designed to destroy this country more than the very idea of this legislation. It is not just its application, but in the abstract the concept of this legislation is giving the idea that we will permanently have in this country have and have-not provinces.
That is wrong. That is foolish. We should understand that Canadians are the same from coast to coast and, if you are going to put in Draconian legislation on three
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provinces, you create divisive attitudes about where you live and regional fairness.
I want to go on to that other group in this country that does not pay their fair share, the chartered banks. In this instance I am not going to savage the current government, but I am going to chide the previous Liberal administration for setting the pattern of allowing the banks to get off the hook. In their last years in office from 1981 to 1984, the Liberals in the same circumstances, moving toward deficits for the first time in large numbers, tried to control the deficit without even touching the banks.
In 1981 to 1984 inclusive, Canada's seven largest banks made profits of $5.37 billion and paid taxes at a rate of 1.34 per cent.
Shame on the Liberals. Shame on the Liberals for giving the banks a break. There is a recession today. That is what they are arguing.


An hon. member:: They made it.


David Barrett: They made the world-wide recession? Oh, come now. I can blame the Tories for a lot of things, but they are too incompetent to create a world-wide recession. They have just done it here in Canada. They have only done it here in Canada. They would not have the competence to do it internationally.
To suggest to me that the Liberal's response was to the recession, recession or not the banks made the $5 billion profit. Why did the Liberals not tax them? I know why. When the Liberals are in office they are very right wing. When they are in opposition they are very left wing. That has been the pattern of this country. That is the Liberal schizophrenia that I just had to remind the House about casually when I speak about paradoxes. Should they be returned to office and there is a breath in my body, I will remind them word and paragraph and chapter of the statements they made while they were in opposition. Oh, will I remind them.
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Nonetheless, the Tories did not create the recession. What was their response to it? They dug us in even deeper. The high dollar a former minister of Crown suggested was a fixed deal with the United States. Mr. Sinclair Stevens said it and the government denied it. I am inclined to believe Mr. Sinclair Stevens. I have not met the gentleman and so that is why I believe him. I have met the other Tories, so I will pick the one I have not met yet. If I have to do it on that scale it is very easy.
The gentleman said there was a fixed dollar and I agree with him. Why else would the Canadian dollar be going up, up, up like that?


An hon. member:: There are lots of reasons.


David Barrett: Lots of reasons. Has the government ever heard of pegging the dollar? Has the government ever heard of the fiscal instrument of leading the nation by saying that the dollar will be traded at x amount?


An hon. member:: Is that NDP policy?


David Barrett: Is that NDP policy? I will say this: I would never have signed a softwood lumber deal as dumb as this government did. It pegged the dollar on the day and the dollar was on a rise and there was nothing in the deal to accept or adjust for that rise. Only Tories could make that kind of a decision.


An hon. member:: You did not answer my question.


David Barrett: I will. I would peg the dollar. I would also limit interest rates. I would never have allowed them domestically to go the way they did. We would have had a two-level interest rate policy in this country.
Total intrusion in the market. What is the bill? It is a total intrusion in the budgets of the 10 provinces that we are trying to keep together as Confederation. If you say that we are intruding on a market, what in the world are you doing interfering in provincial budgets? The provinces of Quebec, Ontario and British Columbia do not need it. You are giving lessons to the provinces that you will not keep yourself.

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I find it hypocritical or paradoxical. Back to the banks and what the Liberals allowed the banks to get away with. Not again.


An hon. member:: Are you going to nationalize them if elected?


David Barrett: They are already nationalized, only it is a private sector nationalization. Those five banks do not enjoy any competition at all. Try and get some regional competition in banks.


An hon. member:: Would you nationalize them?


David Barrett: I would allow the provinces to expand like Quebec has done with the caisse populaire. I would allow the provinces to become far more aggressive as Quebec has done in its economy. Give them some competition. The one thing you free enterprisers do not believe in is competition for those monopoly corporations.


An hon. member:: Tell us what you did for them.


David Barrett: We tried to get the Liberals to open up the banking system. I understand that your government may be doing that. If that is the case, congratulations to you.


An hon. member:: What do you think of Bob Rae these days?


David Barrett: He just proved the case against Bob Rae. You were not in here. It would help you grow hair.
I will just remind the hon. member of the comparison he gave of Ontario paying 7 cents on the dollar. It is up to 33 cents a dollar and they are cluck-clucking about Ontario. That is hypocrisy or paradox.
The record is replete with how this particular government has made a mess of the economy. It has destroyed almost every one of the fiscal attachments that make this Confederation an attractive place to be for all citizens. It has assaulted the poor and small businesses in this country and then has come along with this bill and said: "Now, you will have to pay for all the insults we have given you".
This government is no longer fit to govern. This government does not have a mandate with the Canadian people. It is not popular in any section of this nation.
I think the best and the healthiest thing that could happen in this country is not this kind of stupid legislation but an immediate election. Let the chips fall where they may.
My God, if a government has ever outlived its time, it is this one. Was it Cromwell who said: "For God's sake, go"? If I may invoke Cromwell, you should have gone months ago.


David Kilgour: Mr. Speaker, I am always interested in listening to the member from British Columbia because I share his concern about the banks.
The banks, as he knows, are paying very, very little in terms of income taxes and from all indications have a great many Canadians very unhappy with them.
Will he tell us specifically what his party would do with respect to the banks? Would he nationalize one or all of them? While he is at it, would he tell us why it was that during the three years that he was premier of British Columbia there was such a precipitous loss of confidence in that province? I think he will acknowledge that, or I hope he will because I am a friend of his successor, Mr. Harcourt, and have high regard for him.


David Barrett: Mr. Speaker, first of all, let us deal with the myths about British Columbia.
I will put my seat up against any member of this Chamber who claims that we did not have balanced budgets in the province of British Columbia during the NDP administration.
The fact is we did. We also left $600 million in assets that were later dissipated under the British Columbia Resource Investment Corporation into which poor, unfortunate people were inveigled to invest $30,000 of their funds under a right wing government known as Social Credit. Now BRIC shares are down to about 80 cents.
I can give you a litany of the other assets that were left. The British Columbia Petroleum Corporation. A book which one of the retired executives of West Coast
September 23, 1991

Transmission has written points out that it made $700 million just by marketing natural gas back to the people of British Columbia.
Enough said. If you want to stake your seat on our financial record, do it, but let us put the myth to rest.
The banking system: I personally do not believe that we should buy a bank. I do not believe that, and I do not believe that we should bail out banks either, like the Tories did. In a free marketplace, you have a God-given right to lose money. I find it interesting that they only help the rich when they lost money, not the poor.
What are the alternatives? One of the simple alternatives is to have the logic and the common sense to use internal Canadian financing, just as the Liberal administration started using the Canada Pension Plan in a very, very good way. The step further from the Liberal policy of using the CPP would now be to allow those investors in RRSPs to have access to municipal bonds at 5 per cent and give them a tax credit holiday while the money is in the RRSP and the bond money is being used locally.
There is $90 billion in the hands of the private banks, half of which is only self-directed in the RRSP. If you used the other half and made municipal bonds available-I have spoken on this at some length-it would take that money away from the banks which have nothing innovative at all other than to make massive amounts of profit on interest with no social policy attached.
This is not socialism or free enterprise. This is common sense. Use the indigenous pool of capital that exists in this country to start creating jobs so people can pay taxes and we do not have deficits. People unemployed create deficits because they are not being productive. There is one way.
The second way is to examine the possibilities of Ontario treasury boards, to examine the possibilities of the caisse populaire in Quebec and also the treasury boards in Alberta, indigenous financing for local projects on a long-term basis, the kind of imaginative use of Canadian capital which is not at the vagaries of international capital. It is not offshore borrowing. It is using money here in this country the best we can to buffer ourselves during a recession. It is nothing magical. It is just a little bit of common sense.
The last point is fair shares. Make the banks become competitive by paying their fair share in the tax system. What is wrong with that? Nothing is wrong with it. Also the credit union movement must be strengthened in this country. Extol the virtues of how co-operation among
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ordinary depositors can be a powerful instrument in fiscal policy.
None of these ideas has been considered by this government. It makes the ordinary people carry the can while its rich friends get off on a free ride.


John V. Nunziata: Mr. Speaker, the hon. member seems to have all the answers to the economic problems facing this country.
Can he explain to me, if his economic policies are so sound, why his government was defeated in British Columbia? Is he suggesting that his economic policies were accepted by the people of British Columbia? Did his economic platform in any way contribute to his defeat?


David Barrett: I love to hear that question from my colleague who is a Liberal member. Five prominent citizens in British Columbia were elected as Liberals. Within months they walked across the floor and sat with Social Credit. They changed their policies by changing coats. They are the ones who defeated the New Democratic Party before the government had a chance to extend itself.


An hon. member:: And the people were defeated.


David Barrett: Sure they were. There is no longer a Liberal Party in British Columbia. When the chips were down the Liberal Party in British Columbia went right wing. Four of its members crossed the floor. One of those who crossed the floor was Dr. Pat McGeer who wrote one of the most vicious books on Social Credit, condemning it from head to toe, scandals, payolas and everything. As soon as the Liberals got elected, they joined Social Credit.
While they sat in the cabinet, did they destroy the British Columbia Petroleum Corporation which they voted against and made $700 million for the people of British Columbia? They did not destroy it. Did they destroy the Insurance Corporation of British Columbia? No, they did not destroy it. Did they destroy the Small Development Corporation established by the province of British Columbia? No, they voted against it but did not destroy it.
Every single one of the fiscal initiatives of that government was voted against by those same Liberal members and when they came to power, they kept them and smugly laughed about the profits they made out of them.
I am not cynical. I welcome the questioners question. He is ignorant of his own party's duplicity, but I am just enlightening him a little bit. I would hope that once he gets elected as a Liberal he would stay there, instead of being hypocritical as the Liberals in British Columbia were.

Government Orders
Mr. Bill Domm (Parliamentary Secretary to Minister
for Science): Mr. Speaker, it is very difficult in this House to sit down and not ask some questions of the former speaker. I just have one. It will probably be quite easy for him to answer. Since really not much of what he said has much to do with the bill, I thought I would deal with one of the aspects of his comments.
I can remember back before I was a member of Parliament the policies of the now Official Opposition and the policies of the now New Democratic Party in this House. I would just like a very basic simple explanation as to why they continually fought campaigns showing a replica of the Canadian dollar. On that replica of the Canadian dollar they showed and used extensively across Canada a picture of the late Right Hon. John Diefenbak-er. In that dollar they had the corner folded over and a piece of literature said that the dollar was now only worth 97 cents.
I campaigned against NDPs who thought that the dollar had come down too far. I campaigned against Liberals who said the same thing. What changed your view today, to say now it is a plus when before you said it was a minus in economic development. In your speech today you referred to the dollar being high and strong and said that was causing us all our trouble. You did not mention how it helps fight inflation and how it helps to buy American products on which we depend extensively.
The question to you, and I repeat it because you very seldom stand up and answer the question, why did you not like a deflated dollar in the 1950s and the 1960s and now think the deflated dollar is the only route to go? You were blaming the Conservatives in those years for having a deflated dollar.


David Barrett: Mr. Speaker, I do not recall the Diefen-baker dollar, but I will give him a simple explanation. The dollar was-


John Horton McDermid: You are much too young.


David Barrett: I was much too young. Thank you very much, Mr. McDermid.
A 97 cent dollar internally is worth a heck of a lot more than a 77 cent dollar internally. Thirty-three cents of every dollar is going on that national debt. Diefenbaker did not pile up that national debt, this government did. It doubled Trudeau's national debt. The 97 cent dollar you are talking about is now a 77 cent dollar; that is internal debt.
I want to tell you that joining us in the House today is the former Liberal leader who knows even better than anyone how the Tories have messed up the economy since that time.


The Acting Speaker (Mr. DeBIois):: Resuming debate. The Parliamentary Secretary to the Minister of Finance.


Mr. Pierre H. Vincent (Parliamentary Secretary to Deputy Prime Minister and Minister of Finance):: Mr. Speaker, it was interesting that the hon. member for the opposition should talk about everything except Bill C-32. Mr. Speaker, I think it would be useful to get back to the bill itself and take a very good look at what this bill is supposed to achieve and consider why the government introduced this legislation.
Mr. Speaker, Bill C-32 concerns the Canada Assistance Plan, and most Canadians-I think more particularly of the people in the riding of Trois-Rivieres-find it difficult to understand exactly what the federal government does for the provinces and how it all works. Perhaps I may take a few minutes to provide some background.
Mr. Speaker, in Canada, Ottawa or the federal government makes two types of payments to the provinces-the first kind is called equalization, which is probably the better known of the two. Equalization payments go to the so-called less wealthy provinces. Seven provinces receive equalization: the four Atlantic provinces, Quebec and Manitoba. Three provinces do not receive equalization payments: Ontario, Alberta and British Columbia.
September 23, 1991

There is another program called the Canada Assistance Plan, which means transfer payments made by the federal government to all the provinces. For instance, my own province, the province of Quebec, would theoretically receive two cheques a year from the federal government: one for equalization payments and one for transfer payments to the provinces.
The bill before the House today, Mr. Speaker, applies strictly to transfer payments to the provinces. This bill provides that the so-called wealthy provinces-Alberta, Ontario and British Columbia-will see the annual increase in the amount of money they receive from Ottawa capped at 5 per cent. That is the purpose of this bill. Why? Why these provinces in particular?
As I said before, these are the wealthiest provinces, and in fact, Mr. Speaker, at the rate annual transfer payments to the provinces are increasing, they cost a lot of money. For instance, in 1984-85, the federal government gave the provinces $25.6 billion annually, and this was for all the provinces; in 1990-91, we are talking about $36.3 billion.
Mr. Speaker, if we look at the Atlantic provinces, Quebec, Ontario, Saskatchewan, Manitoba, Alberta and British Columbia, since 1984 spending by all the provinces increased by an average of 6 per cent. Ontario, for instance, has an average annual rate of 10 per cent; British Columbia, 7.6 per cent; and Alberta, 4.3 per cent. Meanwhile, here in Ottawa, this government has cut increases in government expenditures down to an average of 3.7 per cent annually. As you can see, Mr. Speaker, this government has taken draconian measures to ensure its expenditures do not increase. It has done so, Mr. Speaker, because in 1984, we had a national debt of a little over $2 billion, a legacy from the previous government, and since 1984 that debt has increased. The opposition often says it is all our fault. Mr. Speaker, if the opposition or anyone for that matter were to make a fair and accurate calculation of the increase in the national debt since this government came to power and also computed the annual interest payable on the debt we inherited, they would see the amount is the same. This means that if we exclude the interest on the debt, since 1984 we have managed to control spending by dint of good administration.
In 1984, Mr. Speaker, the federal government spent $16 billion more than it was getting in revenue. This
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year, the government will spend $12 billion less than it is getting in revenue. Mr. Speaker, this shows that in seven years we managed to get the administration of this country under control.
However, we still have a problem: the national debt is still there and the deficit is still there, and we must take steps to deal with the deficit and the national debt. One of the ways to do so is Bill C-32, which, I repeat, does not reduce the amount of money transferred to the three so-called wealthy provinces every year. What it does is cap increases in the amount of money the federal government sends to these provinces. The less wealthy provinces which, as I said earlier, receive both equalization payments and transfer payments will not be subject to capping. These provinces will receive the full amount to which they are entitled according to the formula and will not be capped at 5 per cent like the other three provinces.
Another thing we must understand Mr. Speaker, is that the government has frozen all increases in government spending at 3 per cent, until 1994-95, with the exception of transfers to the provinces, while transfers to the wealthy provinces will be capped at 5 per cent, not 3 per cent. Mr. Speaker, you will ask me: Why penalize three provinces? As I said earlier, these are fairly wealthy provinces. We must consider our financial situation. As you know, we often talk about the national debt and the deficit, and as far as the opposition and some Canadians are concerned, it is our problem, not theirs. It is no one else's problem. That is false, Mr. Speaker. The national debt belongs to all Canadians. Each and every Canadian has a $15,000 debt, his or her share of our national debt. It costs the federal government in Ottawa 35 cents of every dollar; 35 cents of every dollar received by Ottawa go strictly to pay the interest on our debt.
Mr. Speaker, Ontario's debt costs that province 11.6 cents per dollar; Alberta's, 8.3 cents per dollar; and British Columbia's, luckily for it, 4 cents per dollar.
So you see, Mr. Speaker, that these three provinces together still pay less interest on their total debts than we do in the federal government. Perhaps they were better run in the past, I agree, but the problem is real. We are asking Canadians to tighten their belts. Mr. Speaker, I cannot imagine returning to my riding of Trois-Rivieres and telling people, "Look, 35 cents of every dollar you send is used to pay interest charges. I would like to raise your taxes a little to be able to give more to the provinces that pay between 4 and 11 cents

September 23, 1991
Government Orders
per dollar as interest on their debt. These provinces are one tenth as indebted as the federal government." We have a social choice to make as a government. We can raise taxes again. I think that no one wants that, Mr. Speaker; you don't want it, I don't want it, Canadians don't want it.
But at the same time, some provinces have low debts, and thus little interest to pay and less to spend on finance charges. Mr. Speaker, those are the provinces that, like the majority of Canadians who are able, must help the federal government solve the problem of the debt and the annual deficit.
Mr. Speaker, that is where Bill C-32 comes in. Again I repeat it, because the difference between equalization payments to the "have not" provinces and the Canada Assistance Plan that benefits all provinces must be understood. The purpose of this bill is to restrict the increase in transfers but not to reduce them. We have heard the opposition say that we were taking money from the provinces. That is false. We are reducing the increase that they would have.
Three so-called rich provinces, Mr. Speaker-and looking at their debt rate, I would call them rich-are affected by this bill: Ontario, Alberta and British Columbia.
So, Mr. Speaker, I think that as Canadians and as people who care about Canada's long-term economic and fiscal health, not simply tomorrow morning but the long term, we must pass this bill as soon as possible.
In closing, Mr. Speaker, allow me to move, seconded by the hon. member for Peterborough:
That this question be now put.


The Acting Speaker (Mr. DeBlois):: Questions and comments. The hon. member for Ottawa-Vanier.


Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Mr. Speaker, it is surprising indeed, but this government has made a habit of imposing a time limit on any debate that bothers or disturbs them in any way.
I cannot understand why this government which has a lot of explaining to do to the people of Canada, a lot of problems to deal with, does not want to discuss this matter and wants to impose a time limit on debate by putting the question. This prevents any further amendment from being made and means that the vote will be taken as soon as we are through debating.
I listened carefully to the hon. member, Mr. Speaker. I have noticed that he has not explained the object of Bill C-32, an Act to amend the Canada Assistance Plan. He talked about the economy, about equalization and many other things. Now, I would have a question to ask him to put in context this much emphasized economic question on which he spent the 12 or 13 minutes of his speech.
Since 1973, Mr. Speaker, assuming that the Gross Domestic Product gives a good enough picture of the goods and services produced in Canada, how can this wealth created by the Canadian people be compared to the national debt? In other words, what is the rates debt GDP?
According to the figures I have-I had the time to do a little research during his speech-in 1973 the debt was equal to 2.7 per cent of the GDP. In 1985, one year after the Tories took office, it was 10 per cent. In 1987-88, it had reached 32.5 per cent. And it is estimated that, by 1995, just a few years down the road, it will be 41 per cent, that is to say that 41 per cent of all the goods and services produced in Canada will constitute debt, Mr. Speaker.
So, I ask the hon. member: Is he defending a good thing or does this economic slump simply go to show that this government is totally incompetent at managing this country on a day to day basis? I ask him candidly.


Pierre H. Vincent: Mr. Speaker, I am happy to see my colleague from Ottawa-Vanier. We always have interesting exchanges together. However, I have to admit I am surprised by the question, especially coming from someone who has been a member of this House for nearly 25 years-


Jean-Robert Gauthier: Nineteen years.


Pierre H. Vincent: Nineteen years then, Mr. Speaker. He comes and talk to me about the GDP, the national debt and the deficit? But, Mr. Speaker, until 1984, his government increased its spending by 15 per cent annually. That is right, Mr. Speaker, 15 per cent a year on average between 1968 to 1984. They increased spending, Mr. Speaker. But revenues were not necessarily coming in at the same rate. That is how we ended up, in 1984, with the Liberal government's credit card limit stretched to $200 billion-not $20 billion, but $200 billion.
September 23, 1991

When this government came into office, it inherited an unpaid credit card bill of $200 billion. At the same time, Mr. Speaker, they were spending $16 billion more than they were taking in every year. So, not only did they leave us with a credit card at its maximum, but they kept at it. In just seven years, by 1990-91, we managed to bring government expenditures down to $12 billion below revenues.
Now, we can take these $12 billion and start applying them toward reducing their debt, by paying their debt charges. That is what is called good, sound management, Mr. Speaker. It is not easy. There were cuts over the past seven years, as you know, and there are yet more to come. Sound management is a must if we want to ensure the future of this country. And sound management requires that we stop spending and start paying our debts.


Mr. Jean-Pierre Hogue (Outremont):: Mr. Speaker, I would have a question for my colleague. At the beginning of his speech, he mentioned equalization as well as wealthy provinces, referring to the rich and poor provinces of this country. I know that, throughout the proceedings of the Belanger-Campeau Commission, some specialists and so-called economists have argued that rich and poor provinces are really not all that different, except for a few clearly identified cases. But Quebec has always been considered one of the rich provinces and, thus, expected, along with the three other provinces mentioned by our colleague, to provide for the not so wealthy. Could my hon. colleague give us again the objective data?


Pierre H. Vincent: Mr. Speaker, I appreciate the knowledge and experience of the hon. member for Outremont. Perhaps I may explain this in simple terms. When the federal government gives money to the provinces, there are two ways it usually does this.
The first is affected by Bill C-32, which we are discussing today, and is commonly referred to as transfers to the provinces. Ottawa gives each province the same amount of money per individual. Suppose this is $10. There are 6 million Quebecers in Quebec so Ottawa will send a cheque for 6 million times $10. There are 8 million Ontarians in Ontario, so Ottawa will send a cheque for 8 million times $10. That is what we call transfers to the provinces.
There is another system for the less wealthy provinces which is called equalization payments, and these are intended to help provinces and their residents whose income is below the Canadian average. The Atlantic provinces, Quebec, Manitoba and sometimes Saskatchewan are eligible for equalization payments. These are computed according to a very complex formula-I don't want to get into the details-but it is based on how the revenues of the provinces compare to the Canadian average. So this is another way the provinces can receive money.
The hon. member pointed out that Quebec is considered to be a wealthy province. Quebec does have substantial revenues. Nevertheless, compared with the national average, it is entitled to equalization payments. I imagine that is what the hon. member for Outremont wanted to clear up.


The Acting Speaker (Mr. DeBlois):: Resuming debate. The hon. member for Ottawa-Vanier.


Jean-Robert Gauthier: Mr. Speaker, there is hardly a minute left before question period. I could start my speech, but once I start, I would like to be able to continue. Perhaps this will give someone else a chance to make some more comment. Considering the time, I move that we call it two o'clock.


The Acting Speaker (Mr. DeBlois):: So if the House agrees, we will now proceed to Members' Statements pursuant to Standing Order 31.


STATEMENTS PURSUANT TO S. O. 31
Mr. Jesse Flis (Parkdale-High Park):: Mr. Speaker, this morning the Department of External Affairs reported that with the exception of a few pockets of fighting, the latest ceasefire in Yugoslavia is holding. This was confirmed by both the Yugoslavian embassy and the Croatian Agent General to Canada.
But this is only the beginning. We must seize this opportunity and actively pursue a settlement. Canadians can be proud of the fact that we were the first country to

September 23, 1991
ask the United Nations to become actively involved in a negotiated settlement of the crisis.
We are pleased that on Thursday a special meeting of the United Nations Security Council will be convened to discuss the situation in Yugoslavia. Today, on behalf of the Official Opposition, I call upon the Secretary of State for External Affairs to contact our Canadian ambassadors around the world and the diplomatic corps here in Ottawa, asking them to do whatever they can to urge the United Nations to work toward a resolution of the crisis in Yugoslavia.


NATIONAL UNITY
Hon. Alan Redway (Don Valley East):: Mr. Speaker, if Quebec separates it will assume its fair share of Canada's national debt. According to the Belanger-Campeau commission, that is 18.5 per cent. Other Canadians say it is 25 per cent. Obviously this would be settled by negotiation.
But what happens if there is no agreement? Even if we do agree, Quebec cannot legally assume any of Canada's national debt without the consent of our creditors. Likely Quebec would have to make side payments to Canada for its share of debt retirement and interest.
What happens if Canadian interest rates rise before the debt is paid? What happens if Quebec defaults on its payments? Who knows for sure. What we do know is that the credit rating of both Quebec and the new Canada will be lower than it is for our present Canada and that will hit each of us personally in the pocketbook and reduce our standard of living.


SOFTWOOD LUMBER
David Barrett: Mr. Speaker, once again Canada is following the FTA rules and getting the back of the hand from the United States for doing so.
This time we are being shafted on softwood lumber. The United States complained about a subsidy. Canadian provinces responded in good faith. Now there is no subsidy and no need for an export tax.
How does our partner in the FTA react? Seventy senators demand that Canada be slapped with a 25 per
cent duty. We have lost trade disputes over steel rails, lobsters, parts of construction equipment and west coast salmon. Even our so-called big win in the pork dispute is a testament to U.S. willingness to back Canadians against the wall even when America's complaint is totally ridiculous.
The FTA is more than we bargained for. We lost 7,000 jobs in the lumber industry. We have seen scores of companies flee south. Over a quarter of a million jobs nation-wide have gone. We have seen our communities devastated by job loss and capital flight. Enough is enough. Abrogate the free trade treaty now and let Canada have a sovereign economy the way it should have had all these years.


QUEBEC'S ACCESSION TO SOVEREIGNTY
Mr. Guy Saint-Julien (Abitibi):: Mr. Speaker, an independent Quebec would be economically viable but the price to pay would be relatively high, according to Patrick Grady in a study published today by the Fraser Institute. This economist predicts that Quebec would suffer a serious recession and that Canada would face economic difficulties.
If Quebec became sovereign, the consequences for Canada and especially Quebec could be serious, he concludes in this 168-page study. The deficit of an independent Quebec would increase and its interest rates would rise. Businesses and individuals would leave, Mr. Grady predicts. He says that if the province separates, its economic activity could decline by 10 per cent in the short term and 5 per cent long term. The economic situation would thus be three or four times as bad as the recession that Quebecers are now barely getting out of.


NATIONAL WOMEN'S CENTRE DAY
Hon. Audrey McLaughlin (Yukon):: Mr. Speaker, today women in communities across Canada are celebrating the first annual National Women's Centre Day. Single mothers, homeless women, abused women and their more fortunate sisters, can all find strength at women's centres. There they will be met with caring faces, supportive voices, and needed information.
September 23, 1991

Women's centres are at the very heart of our communities. Yet last year this government cut funding for women's centres by 100 per cent and only restored it after a national outcry.
It is clear that women's centres must have core funding. Just having year to year funding is not sufficient. Last week in this House there was much discussion about showing how much members of this House respect women in Canada. Actions speak louder than words. I call on this government to institute core funding for women's centres. That is what will count with the women of Canada.



Mrs. Beryl Gaffney (Nepean):: Mr. Speaker, National Women's Centre Day is being celebrated for the first time today to recognize women who are helping other women to help themselves. Many of these women are volunteers.
By providing information, referral and support services, women's centres play a significant role in identifying and addressing the many problems that specifically affect women and in finding solutions to those problems. They also deliver a wide range of education and advocacy programs which support equality for women.
It is time that we acknowledged their important contribution and help in their financial struggle to keep the doors open. Instead, this government has cut funding to advocacy groups by $25 million, forcing the closure of many of these centres which are already barely surviving on short-term grants and endless fund raising. In fact, in several provinces women's centres receive absolutely no ongoing support from the federal government.
The theme of this year's Women's Centre campaign is "Keep the Door Open for Women". I ask the minister responsible for the status of women to stop closing that door and to implement core funding for women's centres in all regions of Canada.



Mr. Peter L. McCreath (South Shore):: Mr. Speaker, today is the first official day we recognize the work being done in women's centres across Canada by dedicated volunteers.
The theme of this year's campaign is "Keep the Door Open for Women". In Bridgewater, Nova Scotia, for example, the Second Storey Women's Centre has organized a variety of projects. Sometimes it seems to take a great tragedy to focus our collective attention on the violence and institutionalized inequalities that are faced by women every day in our society. We act surprised and ask ourselves how wanton acts of violence can occur in our modem society. And yet, how can these things not happen when satirical magazines incite their readers to rape young women in the name of humour, and there is little public outcry.
We must work together to change old attitudes and to banish harmful stereotypes. To do this, we must ensure that our centres receive adequate funding from both public and private sectors. I encourage all members of this House to work with the women's centres in their areas to ensure that they have the funding necessary so that women can take back the night and feel safe in their homes and their places of work.


RESEARCH AND DEVELOPMENT
Right Hon. John N. Tbrner (Vancouver Quadra):: Mr. Speaker, I welcome the government's recent announcement to support the upgrading of the existing cyclotron at the University of British Columbia and to build the world's first KAON factory at TRIUMF, the Tri-University Meson facility.
As you know, Mr. Speaker, as the member for Vancouver South, this joint venture of the universities of Alberta, Victoria, Simon Fraser and British Columbia is located at UBC in my riding of Vancouver Quadra.
I have been aware of the work at TRIUMF for many years. I have toured the facility with its director, Dr. Erich Vogt, and have discussed the planned upgrade.

September 23, 1991
The House will know of my long-standing commitment to this project, as I have raised the subject here in this House on several occasions.
With this project, Canada takes its place at the vanguard of the new technologies. The study of subatomic particle physics at TRIUMF facilitates research in the fundamental forces of nature. Information gathered here has been used in medical, biomedical and geological research, and has led to breakthroughs in cardiac diagnosis, radioisotope treatment, positron brain scanning and the destruction of cancerous tumours in humans.
The impact on scientific research and related technology in Canada will be tremendous.


OCCUPATIONAL TRAINING
Jean-Pierre Hogue: Mr. Speaker, Alain Noel writes in La Presse that the eastern part of Montreal is suffering from a serious shortage of occupational training. Job training is a key issue, says Claude Pichette, president of a committee to revive the economy and employment.
The challenges of training and employment thus also become priorities. All sorts of analyses show that we need to implement a program based on continuing education. Such programs must reach not only the unemployed but also workers who will have to change jobs as our industrial structure modernizes; this means almost the whole labour force every fifteen years or so. The conventional concepts of "upgrading" and "retraining" are no longer adequate because they have a connotation of being exceptional, even marginal. We need a new industrial culture where everyone takes it for granted that they will have to review their training regularly throughout their working life.
Some talk emphatically about the German, Swedish, Japanese or even Swiss models. Mr. Speaker, we should invest in occupational training as those countries do.
[English\


Mr. Bob Kilger (Stormont-Dundas):: Mr. Speaker, the 35th Hockey Hall of Fame induction dinner will be held here in Ottawa tonight. The ceremonies will also feature a salute to the Ottawa Senators hockey club of the past as well as the new addition to the NHL.
First and foremost, however, the dinner will induct NHL players Denis Potvin, Mike Bossy, Bob Pulford, and Clint Smith; coach Scotty Bowman and a former colleague of mine, linesman Neil Armstrong, into the Hockey Hall of Fame.
I know, Mr. Speaker, you had the honour to host a reception for these individuals today. Many Canadians recall their exploits as they participated in the game at which Canada excels. The recent Canada Cup victory proves once again that when it comes to hockey, Canada is number one in the world.
Hockey is also an integral part of Canada's culture and the game has united Canadians from across the country. Over the years, hockey has provided a source of physical fitness for millions of Canadians and countless hours of enjoyment for both player and spectator.
Congratulations to the inductees and a warm welcome to the Ottawa Senators, which will begin play in the NHL's 1992-93 season.


CROSS-BORDER SHOPPING
Mr. Ken James (Sarnia-Lambton):: Mr. Speaker, since the House of Commons recessed for the summer the problem of cross-border shopping has continued at a significant pace. It is a fact that the large price differential in gasoline between Canada and the U.S. is a major motivational factor in the cross-border phenomenon.
Canadians are flocking to the U.S. in greater numbers, lured by lower gas prices and once they are there they are buying other retail goods.
The severity of this problem is captured in a study done by the consulting firm Ernst and Young on the effects of cross-border shopping. It estimated that retail sales losses to our Canadian retailers is in excess of $2 billion nationally. The Retail Council of Canada put retail losses in Ontario alone at $1 billion in 1991.

This phenomenon cannot go unaddressed. Crossborder shopping creates negative economic activity, especially in border communities like Sarnia.
Both the federal and provincial governments must take a serious look at the taxation of gasoline in an effort to help alleviate the problem of cross-border shopping.


AGRICULTURE
Mr. Stan J. Hovdebo (Saskatoon-Humboldt):: Mr. Speaker, it is has been projected that farm families in the grains and oilseeds sectors will have incomes of about $6,500 for this last year. That is about one-third of what we consider to be the poverty income in Canada.
The previous Minister of Agriculture, now Minister of Finance, promised that his government would provide a third line of defence which would make it possible for these farmers to survive. The government has reneged on that promise.
The all-party House of Commons agriculture committee met in August and unanimously passed a resolution pleading with the government to honour that promise. Today the House will vote on that resolution.
I hope that government members will support the grain farmers by voting for that motion and that governments, both federally and provincially, will extend some hope to those thousands of desperate farmers by taking action now on the third line of defence.


CORRECTIONAL SERVICES
Mr. Bill Casey (Cumberland-Colchester):: Mr. Speaker, on August 22, 30 organizations from the municipalities of Colchester county met to discuss the area's qualifications as a location for the proposed facility for federally sentenced women. These organizations represent the people who would deliver the services that would provide the benefits that would benefit the lives and futures of the women inmates.
There were members of church organizations, correctional services personnel, law enforcement officers, women's' centres, children's organizations, health workers, emergency measures groups, educators, community
service groups, all levels of government and certainly representatives of the native community, truly an impressive group that showed true community interest in providing a home for this institution and the people who are to use it.
Truro and the surrounding area is an ideal community in which to locate such an institution. It enjoys easy access for the majority of inmates and their families. It can provide low cost accommodation for visiting families. It is a positive community with a positive people who will provide assistance and be role models as these women move back into society.
I urge the Solicitor General to approve Truro as the site of the Atlantic women's correctional facility because it is simply the best place for it.


NATIONAL UNITY
Mr. Garth Tiirner (Halton-Peel):: Mr. Speaker, these are confusing times to be a Canadian and to be debating the possible breakup of our country.
On the one hand there are people telling us that if Quebec leaves Canada, we would probably all be better off. Certainly that is the message of the Bloc Quebecois and the Reform Party.
On the other hand, groups such as the Fraser Institute are now warning that Quebec separation would mean a stock market crash, higher interest rates and a deep recession for all parts of Canada, including my riding.
I do not know who is giving Canadians the best vision of the future. Canada should not stay together just out of fear. I ask all Canadians to stop and think about these two conflicting positions. Whichever they end up choosing, they will at least have taken some action to form Canada's future instead of just letting it happen. Hopefully, Mr. Speaker, they will choose Canada.


FISHERIES
Mr. Fred J. Mifflin (Bonavista-Trinity-Conception):: Mr. Speaker, the 1991 fishing industry along the northeast coast of Newfoundland and Labrador will be recorded as disastrous, potentially the worst in memory.

September 23, 1991
Oral Questions
This failure is mainly the result of heavy pack ice and icebergs which persisted in some areas until now, resulting in cold water temperatures that disrupted the inshore fishery and the migratory presence of cod, capelin and other species, and the continued plundering of transboundary stocks by foreign fleets. The impact on those communities dependent on the fishery is devastating.
Inshore landings are considerably less than one-half what they were last year and, as a result, thousands and thousands of fishermen and plant workers are without their incomes. Their incomes have been wiped out and there is not enough work to qualify for unemployment insurance.
These are extraordinary conditions and they require extraordinary measures. I join my colleagues in the Liberal Party in calling on the Conservative government for a comprehensive strategy on aid to those engaged in the fishing industry in Newfoundland and Labrador who are in dire need, and for an immediate response to this crisis.


KIDS CARE WEEK
Mr. Scott Thorkelson (Edmonton -Strathcona):: Mr. Speaker, this morning, Consumer and Corporate Affairs launched the second annual Kids Care Week. I know this Elouse shares my dismay that approximately 400 Canadian children die and some 54,000 are hospitalized each year as a result of accidental injuries. Kids Care is a response to this tragic reality.
During Kids Care Week, events will take place all across Canada to reach out to communities and to parents to raise awareness of every day dangers and to stress the message of Kids Care. Children are our most precious natural resource. We must do what it takes to keep them safe. I applaud this vitally important program and wish for a very successful Kids Care Week.



ORAL QUESTION PERIOD


Hon. Jean Chretien (Leader of the Opposition):: Mr. Speaker, tomorrow the government will table its constitutional proposals. I would like to warn the government that constitutional change will be difficult to implement in Canada if the government does not show Canadians it also understands the need for rapid economic change. In the present context, Canadians are not feeling very generous. I therefore ask the Minister of Finance and Deputy Prime Minister, considering the fact that the unemployment rate is rising instead of going down, what kind of concrete measures the government intends to take to reduce the number of unemployed Canadians which today reached 1.5 million.


Hon. Don Mazankowski (Deputy Prime Minister and Minister of Finance):: Mr. Speaker, the key to bringing about growth in the Canadian economy is the reduction of interest rates, and the key to reducing interest rates is bringing down inflation and inflationary pressures. Both have happened and to the extent that has had a positive impact upon the economy, we have seen growth emerge in the second quarter on an annualized basis of 4.9 per cent. We expect that growth to continue, albeit in a modest and moderate way because there are some other difficulties that exist within the Canadian economy, namely, the balance sheets of corporations and a burden of debt overhang, as well as a shortage of credit available to consumers. So it is tempered with that.
The important issue is to get the fundamentals right. We are getting the fundamentals right. Sustained growth and price stability can occur through the containment of inflation and fiscal consolidation. That is the policy we are following, and that is the policy that will produce results.


Joseph Jacques Jean Chrétien: Mr. Speaker, these are the policies the government is following and these policies are not working. I want to tell the government that 1.5 million unemployed Canadians will not be swept under the rug because we are again beginning the constitutional debate.
September 23, 1991

I want to serve notice to the government that we will not let it off the hook with its very bad economic policies and with the mess it has created in Canada.
My question is for the Deputy Prime Minister. Now that we have the free trade deal, when will we see the adjustment programs that the Prime Minister promised to Canadians during the last election in order to face the problems they have today as a result of losing their jobs? The government's promise to give them help is not being fulfilled.


Donald Frank Mazankowski: Mr. Speaker, there are existing programs within Employment and Immigration which have been very effective in terms of providing adjustment measures. The government has provided adjustment in the fisheries sector, the agriculture sector and the shipbuilding sector. All of these things have occurred.
I do not know whether the Leader of the Opposition has decided to support or continue to oppose the free trade agreement, but I want to tell him that in Edmonton the other day Dow Chemical announced that it was going to build an $800 million petrochemical plant. The president and chief executive officer, Mr. Wilcock, stood on the platform and said: "Ladies and gentlemen, this facility would not be built here had it not been for the free trade agreement because it has reduced tariffs and given us access to the marketplace." Now, is that what the hon. member is opposed to?


Joseph Jacques Jean Chrétien: Mr. Speaker, I would like to tell the Deputy Prime Minister and Minister of Finance that there are farmers in Canada who are waiting for help from this government. There are fishermen who help from this government. There might be the creation of a few jobs here and there, but there are hundreds of thousands of people who are losing their jobs because of the mismanagement of this government.
I would like to know if the government will soon present us with an economic plan because we not only need a constitutional plan, but an economic plan to keep this country together.
Oral Questions


Donald Frank Mazankowski: Mr. Speaker, I think the hon. member, who was the Minister of Finance and the President of the Treasury Board, and has had some interest in this issue, will find it very revealing, when he sees the document, that we are taking some very important steps in terms of strengthening the economic union.
I think that will be very positive. I think it will allow for a greater degree of fiscal and monetary co-ordination which I think is necessary in this country. If we are doing it at an international level, surely it has to be done at a domestic level as well. I think that we can build on that.
I agree with the hon. member that the unemployment rate is too high, but I also ask him to remember the fact that over the last six years this country has had the best job creation rate of any nation in the OECD. It has had the second best growth rate. It is the seventh largest economy and the seventh largest trader in the world, and we intend to maintain that leadership.


UNEMPLOYMENT
Mr. Brian Tobin (Humber-St. Barbe -Baie Verte):: Mr. Speaker, my question is for the Minister of Finance, who likes to cite facts. Well the facts are that in eight of ten provinces, unemployment went up not down in August.
The minister knows as well that in six of ten provinces, unemployment exceeded 10 per cent in August. He also knows that unemployment hit a six year high in August, and yet he declared the recession over. Unbelievable.
I want to ask the minister whether 10.6 per cent unemployment, 1.5 million lost souls in Canada, is now the acceptable level of unemployment in this country.


Donald Frank Mazankowski: Mr. Speaker, no one likes to see a level of unemployment that high. I do not, and the hon. member does not. It is not as simple as just simply snapping your fingers and all things come into place.
The German electronic giant, Siemens, wants to quadruple its 3,000 strong work force within the decade.


Some hon. members:: Where?

September 23, 1991
Oral Questions


Donald Frank Mazankowski: Oh, where. "A large number of these jobs would be in Ontario," Mr. William Waite, President of Siemens Electric of Mississauga, said yesterday. He said: "There is one catch, the jobs will materialize only if Ontario can generate enough skilled people able to use the latest technologies. My problem is not with an 88 cent dollar, my problem is with the lack of skilled workers." That is clearly part and parcel of the problem. While we have one million plus people unemployed, there are many jobs that are available but they are not filled because of the lack of training and skills that needs to be provided. That is an issue that is being addressed by the Minister of Industry, Science and Technology and it is one that is going to require the co-operation and the partnership of all components of society.


Brian Vincent Tobin: Mr. Speaker, I am from Newfoundland, not Disneyland, and I recognize a Mickey Mouse performance by a Minister of Finance when I see it.


Some hon. members:: Hear, hear.


Brian Vincent Tobin: Does this Minister of Finance not realize that it is very difficult for 1.5 million unemployed Canadians, for farmers in need and fishermen in need, to be tolerant and generous toward this government and its policies, including regrettably its constitutional policy, when the Minister of Finance has shown nothing but contempt for the unemployed of Canada?
I ask the Minister of Finance: Will he produce an economic plan to help put this country back to work?


Donald Frank Mazankowski: Mr. Speaker, this government has created an economic climate that has produced the best job creation rate of any country in the OECD. We have gone through a recession. The recession has been deeper than was originally expected. We are coming out of it. We are going to have, we believe, sustained growth in the order of 2.5 per cent, achieving 3.1 to 3.5 per cent in
1992.
According to the OECD and other informed observers, it is pretty clear that this country is on the right track in terms of its economic and fiscal policies. We intend to follow that because it is the only way that we can build an
economy that will provide sustainable growth with price stability. That is our goal. That is our objective.


THE ECONOMY
Audrey Marlene McLaughlin: My question, Mr. Speaker, is for the Deputy Prime Minister. The Deputy Prime Minister has just said that they have the best job creation program ever. One and a half million Canadians are asking: "Where is this job from this job creation program?"
The Deputy Prime Minister says we are on the road to recovery, but the statistics say something else. Last week, the international trade figure, particularly our trade with the United States, was the lowest in 10 years. Today, we see that retail sales are still at the recessionary level. The Deputy Prime Minister knows that what this means is lost jobs for Canadians.
Will the Deputy Prime Minister redirect his economic policies so that we can get Canadians back to work and stop just catering to the powerful and wealthy?


Donald Frank Mazankowski: Mr. Speaker, I am sure the hon. member knows that there is a certain lag time. When there is growth that is recorded in the economy, there is a lag time until that is translated into jobs. That is what we are seeing.
With respect to her point with regard to the merchandise trade balance, I remind her that in the second quarter exports grew by some 22 per cent. It is not that exports have fallen, but that imports have increased because of the influx of machineiy and equipment to gear up for the demand that is being created. I think that is what has to be taken into consideration.
Obviously, the recession, as I said, was deeper than was expected. It is going to take a little longer to get out of it. We cannot remove ourselves from addressing the fundamental issue. The fundamental issue is that we must contain inflation. That is the trick to bringing down interest rates. Interest rates have come down by 5.5 percentage points. That trend is continuing. The spreads have come down and that trend, hopefully, will continue. That is the way in which we will get the economy back on its feet again.
We are convinced that there will be sustained recov-eiy, but there must be price stability at the same time.
September 23, 1991


Audrey Marlene McLaughlin: Mr. Speaker, the only trend that is continuing is that unemployment remains in double digits and more than 1.5 million Canadians remain out of work. That is the trend that is continuing, despite what the minister says.

I have another question for the Deputy Minister, who keeps reciting the same old statistics. What does he have to say to employees at Angus, Kemtek and Dominion Textile in Montreal? What does he have to say to employees who have lost their jobs like so many others in this country? What does his government have to say to all these unemployed Canadians? What does it have to offer: statistics or jobs?


Hon. Marcel Danis (Minister of Labour):: Mr. Speaker, I can inform the hon. leader of the New Democratic Party that the Conservative Party has done a great deal for Montreal. And since she wants some facts, I can inform her that today, Merck-Frosst is investing $239 million in current research activities in the pharmaceutical sector. According to the company, this major project was a direct result of the passsage in 1987 by the government of Bill C-22, which enhances protection of intellectual property rights in the pharmaceutical sector. This measure encourages businesses to invest in major research and development activities in this country.
We supported Bill C-22. Where was the New Democratic Party when it could have done something to help Montreal?


Audrey Marlene McLaughlin: I have a supplementary, Mr. Speaker. This is good publicity for the government, but it doesn't produce jobs for Montreal's unemployed.

Mr. Speaker, I have a supplementary. The Prime Minister has said that a Constitution without a vibrant economy is "just a pretty piece of paper".
As we enter another round of constitutional discussions, many Canadians across this country including the ones we have just been speaking about, those without jobs, are preoccupied just with survival, with putting food on the table.
Oral Questions
What real economic option such as jobs or a child care program is this government prepared to bring forward so that those Canadians who are living in need can have their basic needs met, can have a job and a decent child care program? Then, they can work together on the unity of this country.


Donald Frank Mazankowski: Mr. Speaker, I sympathize with the points that are made by the hon. member.
I take no comfort in having an unemployment rate of more than 10 per cent. I also recognize that the hon. member disagrees with the fiscal and monetary policies that the government is following. That is fair ball, but I think that she should recognize the fact that the OECD, which is an international organization, did its report card on Canada and said that it endorsed Canada's monetary policy as being necessary.
It was very supportive of the fiscal policy action and the thrust of the February budget. It was very supportive of the structural policy changes that we have brought forth, i.e. the free trade agreement, the Foreign Investment Review Agency and the GST.
All those things were necessary, including reform with respect to the unemployment insurance program. They were critical about our ability to be productive and in terms of our labour efficiency. They were critical about our unemployment insurance program that they considered was too generous, so we take this as an objective assessment. The hon. member should not ignore that.


Mr. Paul Martin (LaSalle -Emard):: Mr. Speaker, my question is this: The vast majority of Canadian economists believe the Canadian dollar is overvalued by at least 6 cents. Does the Minister of Finance agree?


Donald Frank Mazankowski: Mr. Speaker, the Government of Canada does not have a set exchange rate for the dollar.
It is established in the marketplace. The hon. member can have an opinion on that, but it is established in the marketplace. There are many factors that are taken into consideration, i.e. capital flows, interest rates, inflation rates, merchandise trade balance and all those things. The hon. member should know that.

Oral Questions


Paul Edgar Philippe Martin: Everybody knows that the value of the dollar is as a result of a series of conflicting factors, but it is also clear that this government has tilted the balance the wrong way.
As a result, it is fighting inflation on the backs of the unemployed and it is pillaging our export industries. I did not ask the minister why the dollar is up there; I asked him whether it should be up there.
The vast majority of Canadian economists thinks it is over-valued by at least 6 cents. Do you agree with him?


Mr. Speaker:: I appreciate the brevity of the question, but I would ask all hon. members to put the question through the Speaker.


Donald Frank Mazankowski: Mr. Speaker, the hon. member can have an opinion about the value of the dollar.
The value of the dollar is established in the marketplace. Quite frankly, if the hon. member believes that the dollar is over-valued by 6 cents he might want to enlighten me as to how he would bring the dollar down by 6 cents. How would he keep it there?
I think Canadians will realize-


An hon. member:: Resign.


Donald Frank Mazankowski: The hon. member says "resign". I am not a finance minister who is going to come along with simplistic nonsensical solutions that will not stand up to international scrutiny.
* sic *


AIRLINE INDUSTRY
Mr. Sergio Marchi (York West):: Mr. Speaker, my question is for the Minister of Transport. During the last two weeks, 2,300 Canadians lost their jobs at Air Canada, Canadian and Nationair, in addition to the 3,000 jobs lost last summer.
Today's reports indicate that the government at the open skies negotiations is on the verge of giving full cabotage rights to American carriers, full accessibility in Canada.
Given our industry's serious state of health, the continued loss of thousands of jobs, there is the fact that our industry is so much smaller than the American
industry. I ask the minister how the government can even contemplate offering American carriers full accessibility across Canada.


Hon. Shirley Martin (Minister of State (Transport)):: Mr. Speaker, I appreciate the hon. member's concern about the airline industry in Canada, just as we have concerns about it.
The reason we entered into the negotiations with the United States was to ensure a more viable service between the U.S. and Canada where Canadian industries could get a larger share of the pie.
The hon. member mentions that we are going to put that on the table and I am sure he is getting that from an article in The Financial Post, but I would also like to quote what was said by the speaker referred to in that article: "Canada presented a paper on cabotage at the third exploratory round which outlined controversial aspects including legal, technical, and regulatory implications and, in particular, conveyed the economic concerns raised by Canadian stakeholders that cabotage should not threaten the viability of Canadian carriers".


Sergio Marchi: Mr. Speaker, that is the same talk that Canadians heard before the federal government entered into the free trade agreement, and now those same Canadians are paying the price.
I go back to the same minister: Given that an all-party committee, including Tories, and most of the industry is flatly against cabotage, will the minister categorically state in the House for Canadians that during the open skies negotiations, the Canadian government will not sign an air agreement that will give Americans full cabotage rights in Canada? Yes, or no?


Shirley Martin: Mr. Speaker, this government in its agreements with the United States will not sign anything that is not good for Canadian airlines.


Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, my question is for the Minister of State for Transport.
I want to remind the minister that the current imbalance between Canada and the United States shows a favourable balance of $500 million a year on the Canadian side. This is not something we have to get into in order to protect our carriers.
September 23, 1991

I also want to remind the minister, through you Mr. Speaker, that we have seen thousands of Canadian workers in the aviation industry thrown out of work in the last year alone, that the airlines are operating in the red, passenger loads are down, and the only solution that this government has come up with is to turn over our domestic and international travel to the Americans.
I want to ask the minister what is in these negotiations for Canadian airlines and Air Canada, if anything.


Shirley Martin: Mr. Speaker, the very reason we are in negotiations is to make sure there is a better share for Canadian airlines. In the transporter market, we have not given away cabotage. We have not signed an agreement. We are in exploratory talks.


Iain Francis Angus: Mr. Speaker, the article this morning in The Financial Post made it very clear that not only was cabotage now on the table with the agreement of the Canadian negotiators, but that Canada offered up the so-called fifth freedom, the rights of the Americans to stop off in Canada and pick up Canadians and take them on to a third country.
Given the fact that we saw during the free trade negotiations that this government cannot be expected to work on behalf of the Canadian people, and we are now seeing what is happening with the open skies negotiations, I want to ask this minister, through you Mr. Speaker, if it is not now time to do what the Americans did a number of years ago and walk away from the table while we still have a domestic industry.


Shirley Martin: Mr. Speaker, the fifth freedom rights are a standard agenda item for any international discussion, whether it be with the United States, with the United Kingdom or with any other country.
We will walk away from the table when the agreement is not good for Canada. We will stay at the table until we get one that is good for Canada.
Oral Questions THE ECONOMY


Mr. Jim Peterson (Willowdale):: Mr. Speaker, this morning Statistics Canada reported that retail sales for July were down from June, were down substantially over May, and were down 5.3 per cent over the year.
Just last Friday in this House the Minister of Finance declared, and I quote: "Consumer confidence is up". Can the minister explain how consumer confidence can be up when consumer purchases are down, or was he just wrong?


Donald Frank Mazankowski: Mr. Speaker, the statistics that I have show that consumer confidence was up by 11.7 per cent and business confidence was up by 17.3 per cent.


James Scott (Jim) Peterson: Mr. Speaker, that is so-called confidence that is not expressed through the dollar and through purchases. Canadians are not prepared to put their money where the minister tells them they should be putting it, because they have no confidence in him.
In spite of lower consumer spending, in spite of a ten-year record fall in the trade surplus, and in spite of rising unemployment, our dollar continues to go up. How many more jobs must be sacrificed in the name of this government's economic policies? Just how much unemployment is too much for this government?


Donald Frank Mazankowski: Mr. Speaker, I am not sure what the official policy position of the Liberal Party is. The hon. member who just spoke said that the dollar was over-valued by six cents. I am not sure what the other hon. member who has just asked the question considers the dollar should be. I ask him this: If he has an evaluation, he may want to explain to the House how he would establish that figure, how he would be able to reach that particular figure, and how he would be able to keep it.
Is the hon. member proposing a fixed exchange rate? If he is and if that is Liberal Party policy, why does he not come clean and tell us what he is talking about?

September 23, 1991
Oral Questions UNEMPLOYMENT


Mrs. Diane Marleau (Sudbury):: Mr. Speaker, my question is for the Deputy Prime Minister.
The Deputy Prime Minister knows full well that this government's policies, including the high interest rate and the high dollar, have been responsible for the loss of at least 209,000 jobs in Ontario alone since March 1990. When will the Deputy Prime Minister realize that you cannot have reconciliation in this country if you ignore the unemployed in Canada?
When will he implement the adjustment and retraining programs which were promised over and over again, both during the last election and immediately following it?


Donald Frank Mazankowski: Mr. Speaker, while it is true that there have been some substantial job losses during the course of the recession, and I think in the manufacturing sector that has been the predominant case, but when it is compared to the recession of 1981-82 I think the decline in manufacturing at that period was about 19 per cent and the decline in manufacturing during this period was 11 per cent.
The peak to trough decline during this recession was about 2.8 per cent; the peak to trough decline in the 1981-82 recession was 5.5 percentage points.
Mr. Speaker, we are coming out of the recession. Growth has been registered in the second quarter. That is one-quarter sooner than we had projected. Growth will continue in the third and fourth quarters, and all reliable accounts would lead us to believe that there will be growth in the range of 3 per cent to 3.5 per cent in
1992.	Now, that is cause for optimism and that is cause for confidence.


Diane Marleau: Mr. Speaker, a week ago the Deputy Prime Minister stated that the recession was over. Now he is saying we are coming out of it. Have you changed your mind?


An hon. member:: Right on. He does not know if he is coming or going.


Diane Marleau: Let me remind the Deputy Prime Minister that-


Mr. Speaker:: I want to remind hon. members to put the question to the minister through the Speaker. The hon. member can finish her question.


Diane Marleau: Mr. Speaker, I ask if the Deputy Prime Minister has changed his mind. Just last week there was an announcement of another thousand jobs that were being lost in Toronto at McDonnell-Douglas. When will the government stop ignoring the unemployment disaster that it has created and implement new training and retraining programs?


Donald Frank Mazankowski: Mr. Speaker, what I said and what I will say today is that we have experienced a growth of 4.9 per cent in the second quarter on an annualized basis. We expect growth to be in the order of 2.5 per cent in the third and fourth quarters of this year. We expect growth to range in the area of 3 per cent to 3.5 per cent over the course of 1992. Those are figures that are supported by the OECD and by many other economists. That will give us the fastest growing economy in all of the G-7, if not the OECD.


SOVIET UNION
Mr. Svend J. Robinson (Burnaby-Kingsway):: Mr. Speaker, my question is for the Minister of Finance. I have just returned from the CSCE conference in Moscow where we heard first hand about the very serious economic crisis which faces the people in the Soviet Union this winter with widespread shortages of food, power and medical supplies. As Alexander Yakovlev has said: "Empty pans are more dangerous than tanks".
I want to ask the Minister of Finance: Will Canada now show leadership in the G-7 by supporting the urgent request of Soviet leaders, including the Prime Minister, mayors of Leningrad, Moscow and others for major food and other aid now to avert this looming crisis facing the Soviet people who showed such courage, as winter approaches?


Donald Frank Mazankowski: Mr. Speaker, the leadership for the co-ordination of this particular initiative is in the hands of the Prime Minister of Great Britain, John Major, who is the current chairman of the G-7 group of countries. He has been there. My colleague, the Minister for International Trade has been there, our deputies have been there. They are looking at ways and means of
September 23, 1991

putting together a package, but also, more important, looking at ways and means of distributing such food aid, medicines and other support measures. What is really important is to establish the mechanism.
I think, as the hon. member knows, that the system for distribution is not very sophisticated. Unless there are mechanisms to ensure that the aid, food and medicine get to the right people at the right time, it will go of little value. That co-ordination is taking place and Canada is very much a part of that exercise.


Svend Johannes Robinson: Mr. Speaker, I have a supplementary for the same minister. Five years ago the tragic explosion at the nuclear reactor at Chernobyl resulted in thousands of deaths and widespread illness, environmental damage and homelessness in Ukraine, Byelorussia and Russia.
Given this devastation, will Canada respond positively to the urgent appeal which was made last week at the United Nations General Assembly by these republics for a $646 million fund to help eliminate radioactivity from the food chain and to resettle the homeless victims of the Chernobyl disaster?


Hon. Jake Epp (Minister of Energy, Mines and Resources):: Mr. Speaker, I can report to the House that in my meeting today with members of the delegation of Ukraine, the president, the minister of health and others, we discussed the exact issue that the hon. member has raised. I pointed out to them our interest to help.
The hon. member would know that on September 20 there was a pledging conference in which Canada participated. I would also draw to his attention that through the World Health Organization and the International Atomic Energy Agency, we have been using our participation and membership there to help.
I also have instructed my officials at the Atomic Energy Control Board and will speak to AECL on whether or not we could help in a technical way the people of Ukraine. The last point I would like to make to him is I discussed this at the IAE at my recent meeting in Vienna, as well as with Canada's membership of the working group of the European Energy Charter in which we are now responsible for chairing the nuclear working
Oral Questions
committee. We look forward to very close co-operation with the delegation and the people of Ukraine.


MONTREAL'S ECONOMY
Jean-Pierre Hogue: Mr. Speaker, when the Quebec caucus met in Riviere-du-Loup in August, members from the island of Montreal presented a study on Montreal's economic situation. As chairman of the Montreal caucus, I have a question for the minister responsible for the Montreal area.
Could the minister tell the House about the government's latest initiatives to give back to Montreal its assets, its economic advantages, and to restore it to the place it always held and should still hold?


Marcel Danis: Mr. Speaker, let me reply on behalf of the minister responsible for the Montreal area who is now with the Prime Minister in Montreal, where Merck-Frosst will announce this afternoon that they will invest over $200 million, raising the number of researchers from 200 to 300. Mr. Speaker, that is a direct result of a policy of this government.
Were it not for this policy and Bill C-22, we would not have had that investment in Montreal. It is thanks to that policy. Mr. Speaker, we know that the situation in Montreal is difficult; we know that very well, but we will try to improve it with policies like Bill C-22.


THE CONSTITUTION
Mr. David Dingwall (Cape Breton-East Richmond):: Mr. Speaker, my question for the Deputy Prime Minister.
The Prime Minister has asked for the co-operation of the national parties in this House when it comes to the Constitution. The government has asked for our good faith and it has pledged to us the spirit of non-partisanship.
In that spirit, the Leader of the Opposition has agreed to be briefed on the government's constitutional proposals this afternoon at 4.30 p.m.

September 23, 1991
Oral Questions
Will the Deputy Prime Minister please inform the House, at what time they brief members of the Business Council National Issues?


Right Hon. Joe Clark (President of the Privy Council and Minister responsible for Constitutional Affairs):: Mr. Speaker, there has been no briefing of the Business Council on National Issues that would be similar in any way to the extent of the briefing that is to be presented to the Leader of the Opposition.
If the House leader of the Official Opposition is interested in continuing the practice of non-partisanship that we have sought to establish on this issue, I would certainly be interested in the opportunity to discuss this matter with him directly and privately. If he has a problem, he knows, as other members of the House do, that all they have to do is raise it with me and we will resolve it.


David Charles Dingwall: Mr. Speaker, the first responsibility of any government is to act in good faith as an agent of all the people. That is why on this side of the House we are alarmed at the reports that the government has chosen to provide a confidential briefing on constitutional proposals to Canada's major business corporations before briefing members of this House or, indeed, provincial premiers.
Will the Minister Responsible for Constitutional Affairs stand in his place and deny categorically that there have been no briefings put forward by him, the Prime Minister's Office, PCO or any other officials for members of the Business Council on National Issues.


Charles Joseph Clark: will not try to rescue the member from his double negatives, but I certainly am prepared to stand in the House and say that I personally have been involved with briefings of the president of the Canadian Labour Congress. I have spoken to the president of the Canadian Federation of Independent Business. Today I have been in touch by telephone with heads of the two territorial governments and with a number of premiers. The Prime Minister has been in touch with a number of other premiers.
I, personally, have not been involved in discussions with BC&I but I have certainly authorized discussions
that would ensure that there is a wide understanding in the country of what it is we are trying to achieve with these proposals.
There was an arrangement announced some time ago and established with the Leader of the Opposition and with the Leader of the New Democratic Party with respect to briefings that will be much fuller because of their parliamentary status than that of others.
I am very encouraged by the non-partisan approach that has been taken on this issue by the New Democratic Party. I hope that will be followed by the Liberal Party of Canada.


Mr. Don Boudria (Glengarry-Prescott-Russell):: Mr. Speaker, my question is for the Acting Secretary of State for External Affairs or, in his absence, for the Deputy Prime Minister.
My question concerns the COSIC computer boondoggle. Reports over the weekend inform us that this project has now been halted. I want to ask how it is that the government has spent $140 million of taxpayers money on the first phase of a $28 million project, and ends up with something that does not even work.


Hon. Paul Dick (Minister of Supply and Services):: Regrettably, Mr. Speaker, the hon. member has not sought the facts. If he had sought the facts, he too would have realized that the reporter made some grievous errors in reporting, because in fact the Fenco Engineering contract of COSIC, and where Fenco was joined by Honeywell, Canac and Digital Equipment, is a project in the first phase of some $38 million, and which was estimated at $42 million with some add-ons.
The over-all project budget will be $56 million of which so far only $53 million has been spent.


Don Boudria: Mr. Speaker, I cannot help but wonder what the mystery lobbyist lunch guest is feeling about this project now.

I would ask the Minister of Supply and Services whether he is prepared to table in this House a complete report on all cost increases related to this project.

September 23, 1991

Oral Questions
Canadian taxpayers want to know who has wasted their money and why this project is not even working.


Paul Wyatt Dick: Regrettably, Mr. Speaker, the hon. member did his supplementary and had it prepared before he heard the answer to the first part. This project is within budget and the thing does work. It is at $53 million and not at $56 million. The report was wrong.


NATIONAL UNITY
Garth Turner: Mr. Speaker, a new study done for the Fraser Institute predicts tough economic times for all of Canada if Quebec separates. If the separatists have their way, says the study, Canadians can look forward to a recession, a trade war, higher interest rates, a stock market crash and a flight of capital from Canada.
My question is for the Minister of Finance. Is this report an example of needless fearmongering, or do Canadians really have some reason to economically fear Quebec separation?


Donald Frank Mazankowski: Mr. Speaker, we hope that is a hypothetical question. We clearly hope that the proposals that will be announced in the House by the Prime Minister tomorrow will set the stage for the kind of debate that we, as Canadians, want to renew the Canadian federation.
I think it is fair to say that if there should be any breakup of the country, all regions in all provinces would be affected in a very negative way because I think if you look at it, Mr. Speaker, you will find that provinces like Alberta, Manitoba, Nova Scotia, Quebec itself, rely to a large extent upon the internal market for their economic activities.
I think at this juncture we would do well to heed the advice of Sir John A. Macdonald, our first Prime Minister, who said 130 years ago, and I quote: "Whatever you do, adhere to the union. We are a great country and shall become one of the greatest if we preserve it. We shall sink into insignificance and adversity if we suffer it to be broken."
I think that is a very profound statement. It was accurate 130 years ago; it is accurate today; it will be accurate tomorrow, Mr. Speaker.


MALAGASH HARBOUR
William D. (Bill) Casey: Mr. Speaker, my question is for the Minister of Fisheries. First of all, I want to say the people of Malagash Harbour welcome the recent announcement of the money made available for dredging the harbour. However, this only exacerbates the problem of the Malagash wharf which was substantially damaged in a storm over a year ago.
Will the minister commit that the wharf at Malagash will be a priority and included in the next year's budget for repair or replacement?


John Carnell Crosbie: Mr. Speaker, I understand and sympathize with the hon. member's position. There has been a dredging project approved for the harbour in the amount of $50,000, the work to be undertaken in October. I certainly hope that we can proceed with the rest of the work next year. However, it will depend upon our budget and regional priorities. The hon. member will certainly get every consideration in connection with his intense representations.


NATIONAL UNITY
Audrey Marlene McLaughlin: Mr. Speaker, my question is for the Minister responsible for Constitutional Affairs. He said earlier that a number of groups or organizations had received a briefing. I would like to ask him, in the spirit of openness with which we are all trying to approach this issue, if he can tell this House exactly, since we have seen media reports, what media have been briefed, what organizations have been briefed and who exactly has already received the document that is going to be presented to the House tomorrow?


Charles Joseph Clark: Mr. Speaker, no one has received the document apart from the Prime Minister, myself and two or three of the ministers who have been centrally involved in the com-

September 23, 1991
Routine Proceedings
mittee. There was, of course, a last discussion last night on the part of ministers of the whole cabinet.
The document, to my knowledge, and I am sure that I would know, has not been circulated to anyone else. I have made arrangements to have the document delivered by special courier to the head of every government, including the two territorial governments, by nine o'clock local time tonight. That will be after the briefing of the Leader of the New Democratic Party and the Leader of Her Majesty's Loyal Opposition.
With regard to the list of individuals, I should perhaps make a distinction between the kind of briefing that the hon. member will receive later today and the conversations that have been had with a number of people outside government. We have indicated in fairly general terms to a number of organizations, including as she would know the Canadian Labour Congress, where we intend to move in this document. But the document has not been circulated. It will come first to the House of Commons, with the exception of those 12 copies that will be sent, as I am sure the House would agree would be appropriate for them to be sent, under embargo to the premiers and heads of government of the provinces and territories.

[Translation\


MONTREAL'S ECONOMY
Mr. Benoit Tremblay (Rosemont):: Mr. Speaker, my question is directed to the new minister responsible for Montreal. Last Wednesday, all the members from the Montreal area who spoke on the economy of that area considered the feasibility study concerning the very-high speed train, referred to in French as the TGV, as a priority to promote economic recovery. Can the minister tell us today if the federal government is willing to take part in this study alongside all the other interested parties?


Marcel Danis: Mr. Speaker, speaking on behalf of the minister responsible for Montreal who, as I said earlier, is consulting with the Prime Minister about an important announcement, I can tell my hon. colleague from Rosemont that, if I remember correctly, 48 of the 66 recommendations that came
out of the Montreal Economic Forum were passed on to this government. I can assure him that all of them will be given due consideration, including the one he has just mentioned.


PRESENCE IN THE GALLERY
Mr. Speaker:: I draw the attention of hon. members to the presence in the gallery of His Excellency Leonid Kravchuk, Chairman of the Supreme Rada of Ukraine.


Some hon. members:: Hear, hear.



ROUTINE PROCEEDINGS


Mr. Michel Champagne (Parliamentary Secretary to Minister of Forestry):: Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the Government's response to 10 petitions.
[Editor's Note: See today's Votes and Proceedings.]



CITIZENSHIP ACT


Hon. Warren Allmand (Notre-Dame-de-Grace) moved: for leave to introduce Bill C-285, an act to amend the Citizenship Act (oath of allegiance).
He said: Mr. Speaker, in order to become a Canadian citizen under the existing Citizenship Act, an individual must pledge allegiance to Her Majesty Queen Elizabeth II, her heirs and successors.
This bill to amend the Citizenship Act would require a pledge of allegiance to Canada and the Canadian Constitution.


[Stage Direction]
Motion agreed to, bill read the first time and ordered to be printed.
September 23, 1991
[Stage Direction]
Routine Proceedings


Hon. John Bosley (Don Valley West) moved: for leave to introduced Bill C-286, an act to amend the Canada Elections Act (addition to the official list of electors).
He said: Mr. Speaker, members will remember during the last election the difficulties we all faced with electors who had been left off enumerators lists and were not able to vote on election day because they were deprived of their right to vote.
The purpose of this bill is to make sure that such a travesty, such an abuse of democratic rights, will never happen again in federal elections.


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


Patrick Boyer: for leave to introduce Bill C-287, an act respecting referen-dums and plebiscites in Canada and questions of public importance.
He said: Mr. Speaker, referendums and plebiscites are a rare, but very important instrument of direct democracy in Canada. Two, in fact, are under way in Saskatchewan and British Columbia at the present time. However, at the national level we do not have in place the enabling legislation. Although we have a Canada Elections Act for elections, we do not have a referendum and plebiscite act for direct voting.
The purpose of this bill is to provide the enabling legislation for direct votes at such times as Parliament would authorize.


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


Ms. Sheila Copps (Hamilton East) moved: for leave to introduce Bill C-288, an Act to amend the Food and Drugs Act (list of ingredients).
She said: Mr. Speaker, I would like to take a few minutes of the time of this House, if I may, to introduce for first reading this bill of great significance for many families with members who suffer from allergies.

This bill is similar to one I introduced in the last Parliament which was passed unanimously but which unfortunately died on the Order Paper. It deals with food labelling for people who suffer from life threatening allergies. It would require restaurants to have available a every specific listing of ingredients. This would save lives.
In particular I would like to recognize the work of Mrs. Betty Taylor on this bill. Her son Christian died as a result of eating nuts in food that was not properly labelled.


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


Ronald MacDonald: for leave to introduce Bill C-289, an act to provide that Remembrance Day be included as a holiday in Public Service collective agreements.
He said: Mr. Speaker, I will only take a moment to inform the House of the intent of this bill. It appears that the farther we get from times of conflict in which Canadian lives have been lost in pursuing peace or in collective action against an aggressor, the concept of Remembrance Day as a holiday for all Canadians to remember the contributions that people have made becomes in peril.

September 23, 1991
Routine Proceedings
It has come to my attention, and to the attention of other people in the House, that Remembrance Day is not a compulsory holiday for purposes of employees under the Public Service Staff Relations Act. If passed, this bill would ensure that Remembrance Day in perpetuity would be a statutory holiday for all of those contracts negotiated under the Public Service Staff Relations Act.


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


Mr. Pat Nowlan (Annapolis Valley-Hants) moved: for leave to introduce Bill C-290, an act respecting access to information on Governor in Council appointments.
He said: Mr. Speaker, I very briefly would like to introduce this bill. I am glad to have leave to introduce it. It would provide more information on Governor in Council appointments. Specifically, I think it has been an anomaly and part of the problem of the malaise in the land that in Governor in Council appointments, cabinet appointments, the salaries paid to people who are paid by the public purse never seem to really get into the public domain in the way they should.
This bill and philosophy is: He who pays the piper, that is the taxpayer, should at least hear the tune of what he is paying and I hope it passes in due time.


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


Mr. Ross Stevenson (Durham) moved: for leave to introduce Bill C-291, and act to amend the Canada Shipping Act (discharge of ballast waters). He said: Mr. Speaker, the purpose of this bill is to prevent the further infestation of foreign organisms into the Great Lakes ecosystem by establishing mandatory regulations for the exchange of the ballast water of ocean going vessels proceeding through the St. Lawrence Seaway into the Great Lakes system.


PETITIONS
Iain Francis Angus: Mr. Speaker, the folks of Atikokan will be quite pleased that you get their name first.
I have the honour to present two petitions today. The first one is very timely given the visitor in the gallery earlier.
The residents of Thunder Bay who attend the Holy Cross Ukrainian Church have petitioned this House pointing out that Canadians of Ukrainian descent have a long and proud heritage. They have made a tremendous contribution in building our country.
The Canada-Ukrainian route should be better recognized by the federal government. The petitioners point out that September 7, 1891 is the date marking the arrival of the first Ukrainians to Canada. They call upon Parliament to declare September 7 Ukrainian Day in recognition of the rich heritage and enormous contribution of Canadians of Ukrainian descent.


Iain Francis Angus: Mr. Speaker, I also have a petition signed by residents throughout northern Ontario; Kenora through to Timmins, Porcupine, Keewatin and Longbow, Ontario.
The petition calls upon Parliament to support the NDP plan to restore VIA Rail service which was cut on January 15, 1990 to maintain and where appropriate up-grade service on which many Canadians rely, provide a legislative mandate for VIA Rail and make available to VIA the resources which it needs to become a modem passenger rail system in a class with those of the rest of the western world.


Mr. Mac Harb (Ottawa Centre):: Mr. Speaker, I have a petition signed by a number of Canadians.
The petition refers to Bill C-21 in which the adoptive parents have been discriminated against whereas their leave has been reduced from 15 to 10 weeks while at the same time it has increased when it comes to biological
September 23, 1991

parents up to 25 weeks. That is 15 weeks maternity plus 10 weeks parental leave.
These constituents have referred to the fact that the cost to the Canadian taxpayers for providing equal benefit for adoptive parents would be only about 6 cents a year.
The petitioners are asking the House of Commons to ask the government to deal with this issue as quickly as possible and to put some equity into the system.


Mr. Mike Breaugh (Oshawa):: Mr. Speaker, I am pleased to present a petition today from several members of the Oshawa Polish community who are concerned about a number of people who are labelled by the Minister of State for External Affairs as self-exiles.
The petitioners are simply asking the government to speed up the processing of the outstanding self-exiled applications, to remove the quotas which have applied to them and to apply the traditional sunset provisions so that these people may become productive Canadian citizens as soon as possible.


Sergio Marchi: Mr. Speaker, I too rise in my place with my friend from Ottawa Centre to complain bitterly on behalf of Canadians who have signed my petition which urges the government to review Bill C-21 which in effect has reduced the leave provided to adoptive parents compared to increasing it for biological parents.
The petitioners are basically saying that the needs of an adopted child are the same if not more than for a biological child. We ought not to discriminate against parents who are adopting. The issue is the care provided for the adopted children.
The petitioners and our party have urged this government in the past-they continue to do so-to rethink and re-evaluate Bill C-21. The government should ask itself if it is true that an adopted child is less important than a biological child.


John V. Nunziata: Mr. Speaker, I would like to present to the House a petition containing the signatures of several hundred people.
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The petitioners are calling upon this government to come to its senses and to rescind the regressive goods and services tax.


The Acting Speaker (Mr. DeBlois):: We now come to Questions on the Order Paper. The hon. member for Champlain.


Guy St-Julien: Point of order, Mr. Speaker.


The Acting Speaker (Mr. DeBlois):: The hon. member for Abitibi on a point of order.


Guy St-Julien: Mr. Speaker, can the member for Abitibi table petitions in the House of Commons? I have risen almost every time and you did not recognize people on this side of the House, only those in the opposition.


The Acting Speaker (Mr. DeBlois):: The hon. member can surely table a petition as any other member can. I would point out to you that I took 15 seconds to look around and I saw no one get up.
That said, I am pleased to return to Presentation of Petitions and to recognize the hon. member for Abitibi.


Guy St-Julien: Thank you, Mr. Speaker.
I have the honour to table a petition signed by people from Riviere-Heva, Amos, La Sarre, La Motte, Saint-Mathieu, Saint-Felix d'Alquier in Abitibi. They humbly ask Parliament to seriously consider the deficiencies of the Canada Labour Code when it reviews that legislation and to recognize the need to include clauses on preventive paid leave for pregnant women.


QUESTIONS ON THE ORDER PAPER
Michel Champagne: Mr. Speaker, I move that all questions stand.


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


Some hon. members:: Agreed.

September 23, 1991
Government Orders



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Mazankowski that Bill C-32, an Act to amend the Canada Assistance Plan, be read a second time and referred to legislative committee F; and the motion of Mr. Vincent (p. 2536).
The Acting Speaker (Mr. DeBlois):: When debate was suspended, the hon. member for Ottawa-Vanier had the floor.


Jean-Robert Gauthier: Mr. Speaker, before I start my speech, I first want to wish one of our colleagues, Mr. David Walker, the hon. member for Winnipeg North Centre, a speedy recovery.

I understand, David, that you are under the weather but let us hope that our main critic on this subject matter will be here before this debate ends.

Mr. Speaker, the bill before the House is not an extremely complex piece of legislation. It consists of a single section whose purpose is to amend the Canada Assistance Plan. The bill proposes to extend the 5 per cent capping of increases for transfer payments under the Canada Assistance Plan from two years to five. As you know, Mr. Speaker, capping applies only to those provinces who do not receive equalization payments. I am referring to Ontario, British Columbia and Alberta.
Mr. Speaker, the purpose of the Canada Assistance Plan is to help the provinces provide welfare payments and services to the needy as well as social welfare services aimed at relieving, eliminating and preventing the causes or effects of poverty, child neglect or welfare dependency.
Mr. Speaker, this is a worthwhile program that is part of our Canadian way of doing things, part of our national fabric, a program that is extremely important because it enables those who are better off to help those in need.

The Canada Assistance Plan is our safety net of last resort. It makes it possible for provinces to provide basic
income to close to two million low-income Canadians. These people are in this situation, not by choice but sometimes because they just cannot get out of it. They were bom into it and they are having an awful time trying to get away from it.
Many low-income Canadians have been forced out of work, cannot find a job and have used up their unemployment insurance. They must apply for social assistance under this program.
According to government estimates, the three affected provinces, Ontario, Alberta, and British Columbia, will lose $2,135 billion in federal transfers over the next five years, that is from 1991 to 1996. Provincial estimates are much higher than that. Ontario, my province, estimates that the cap on this Canada Assistance Plan will cost Ontario $1 billion this year alone.
The premier of Ontario in an interview reported in The Toronto Star on August 16, 1991, is quoted as saying: "Ontario cannot afford literally to put up with the notion that in times of recession, which has hit Ontario harder than anywhere else, that our citizens are going to be even more vulnerable than others".
By moving with Bill C-32 the Conservative government is leaning toward the new social services proposed by some right-wing groups, the Reform Party among others, which call for a reduced government role in social services and leaves the burden to non-governmental agencies, business volunteers, families, assuming all the time that the government's share of carrying this load is not a public responsibility.
We in this party disagree strongly with the policy put forth by our right-wing partisans in this country.
['Translation)
In this context, Mr. Speaker, the purpose of the bill is to transfer the tax burden to the neediest in this country. Our social security safety net is one of the key elements of our country's social security system.
I may remind hon. members that welfare and social service recipients include, first of all, children who have been removed from parental custody or who need protection because they have been abused or neglected. This group also includes the physically or mentally disabled. There are also single parent families. In Ottawa-Vanier, in my riding, 20 per cent of all families are single-parent families, and 85 per cent of these are headed by mothers with children. Then we have the
September 23, 1991

unemployed. In the Ottawa area, the unemployment rate for August was 7.3 per cent, the highest rate ever for that month during the past five years. Finally, we have families and individuals who are in dire straits and low-income workers.
Mr. Speaker, my statistics are taken from government documents, from StatsCan. These are public figures, and I imagine they are reliable.
According to the Ottawa-Carleton Social Planning Council, a body which has considerable credibility at the regional level, 16,500 people were on welfare in July 1990 in the Ottawa-Carleton region, an increase of 21 per cent over the same period during the previous year.
From 1984 to 1988, the total tax burden for a two-income family with two children and a total income of $26,000 increased 39 per cent-which includes federal, provincial and municipal taxes-while the tax burden of high income families earning about $100,000 increased only 11 per cent.
In 1988, 40.5 per cent of single-parent families earned an annual income of between $10,000 and $20,000; 23.9 per cent of these families earned an annual income of less than $10,000. These figures are from StatsCan, Mr. Speaker. The poverty rate is 33 per cent among single mothers and 12 per cent for single fathers. I am talking about single-parent families.
In Ontario, a family of four with two incomes from full time jobs at minimum wage cannot possibly have enough to stay above the poverty line. That is serious, Mr. Speaker. I would even say it is sad. The poverty rate of families with children where the head of the family is under 25 is 55 per cent.
The reduction in the number of middle-income jobs combined with an increase in the number of low-paying jobs, as was revealed in a recent study by the Economic Council of Canada, does not augur well for these families. In its report entitled The Other Side of Fat City: Child Poverty in Ottawa-Carleton, the Social Planning Council of Ottawa-Carleton stated that an alarming number of children are affected by poverty in this region. Fourteen per cent of children under the age of 18, or 19,000, are living in poverty, Mr. Speaker and 17 per cent
Government Orders
of children under the age of six, compared to 13 per cent for children between the ages of 6 and 17.
Families are increasingly dependent on food banks and soup kitchens. The rolls of welfare recipients are growing and too few decent jobs are created to help these people. This government has cast them into a mould that many will have a hard time getting out of. Unemployment and welfare are becoming the rule, and employment, far too often, the exception.
In 1988, there were 945,000 poor children in Canada. While Ontario is among the wealthier provinces in the country, it also has the largest number of children between 0 and 14 years of age, or 34.7 per cent, based on figures from Statistics Canada again. In Vanier, a city in my riding, there are reportedly 935 poor children. Even in ritzy Rockcliffe, there are 15.
On May 28, 1990, the Prime Minister signed the World Declaration on the Survival, Protection and Development of Children on behalf of Canada, thus committing this country to the reduction of poverty.
The Secretary of State for External Affairs who, I notice, is with us today recently quoted the Secretary General of the UN, Mr. Javier Perez de Cuellar, as saying-I do not have the exact reference, but I am told the quote is from the minister. She said, quoting Perez de Cuellar: "The way a nation treats its children shows not only the compassion and kind protection it is capable of, but also its sense of fairness, its concern for the future, its desire to provide future generations with a better life." It goes without saying that what goes for the international community should go for individual nations.
Mr. Speaker, the numbers reveal a sad state of affairs. When we look at the facts, there is no doubt we have a problem in this country. All the same, this government is introducing a bill which is going to create problems here, in Ottawa-Carleton, in Ontario as well as in British Columbia, but refuses to share the tax burden with the provinces.

According to an article in The Ottawa Citizen dated December 10, 1990, infant mortality rates among poor children are twice as high. Accidental deaths are twice as common, and deaths from infectious diseases are 2.5

September 23, 1991
Government Orders
times more common. In 1986, the high school dropout rate among poor children in Canada was 2.2 times the rate among children from non-poor families.

Mr. Speaker, according to the National Council on Welfare, health and higher education together account for about 11 per cent of the total value of goods produced in Canada. In Ontario, about one student in three drops out before completing 12th grade.

In his budget of February 26, 1991, which announced this measure that we are dealing with today, the Minister of Finance at the time said:
There are worrying signs that our education system may not have kept pace with the needs of a competitive economy in the 1990s. As many as 30 per cent of our high school graduates are unable to meet everyday reading demands. We have an alarming secondary school dropout rate, almost 30 per cent, and for the most part these individuals are unable to go on to high quality vocational training. Our young people need to have the educational training to continue to learn for the rest of their lives. Whether our secondary school system is in tune with the 1990s is by no means certain.
This bill cuts right into training, right into educational programs, by cutting federal contributions.
In that same budget the government cut funding for education and health care. I could go on and give details on those cuts, but I will expect somebody to ask me questions because that is a very important part of the debate here today.

The Conservative government treats education as a government expense instead of considering it an investment in our future. With less money and the government cutting funds for education, we will have fewer skilled and qualified workers to meet this global challenge of being competitive, of being able to produce, of being people whom the international market wants to deal with.
sive, Mr. Speaker, quite a bit more expensive than education. As we said in the GST debate, taxing books encourages ignorance. It is bad, not good!
Of course, we must not expect results in the short term. An educated, well-trained labour force takes several years to develop.
The need for social assistance and services will continue to grow during this recession, caused largely by this government's disastrous policies. I need not mention all of them, because the litany is quite long. We come back to free trade, the goods and services tax, changes to unemployment insurance, the high interest rate policy, the overvalued dollar and so on, Mr. Speaker.
In my riding this summer, people knew what it was all about when we talked to them about the problems concerning Canadians. They said, "First and foremost the economy, Mr. Gauthier. Make sure I have a job. Make sure they don't tax all I've got in my pockets. Then, Mr. Gauthier-Do your job on the Constitution, you politicians. Solve that problem!" Well, we will solve the constitutional problem, Mr. Speaker, but as for the economy, we will really have to look into it and put forward policies that make investments in education, training and labour force development ones that give us control and make our youth competitive with other countries.
It is no exaggeration, Mr. Speaker, to say that money spent on education is an investment in the future. Not spending on it could cause us serious problems. It is sad to see the cuts made to education in past years.

I want to quote from the Canadian Association of University Teachers.
Freezes on federal funds for universities will amount to a cut of $3.8 billion for the fiscal year ending 1995. This amount is much greater than annual operating budgets in the Universities of Newfoundland, Nova Scotia, Ontario, Alberta and British Columbia.
The less competitive we are, the more unemployed and welfare recipients there will be, obviously. The more we can compete, the wider the labour market is, the more our young people will be able to find fulfilling work. More access to the labour market means fewer dropouts and fewer social problems. Ignorance is expen-
A poll in January 1991 by Angus Reid found that 93 per cent of Canadians agree that the federal government should continue to fund higher education. Two-thirds believe federal funding should be increased.

September 23, 1991

I want to give to the House some of the figures. In 1990-91, there were cuts of $321 million. In 1991-92 there were cuts of $581 million. In 1992-93, there will be $755 million cut and in 1993-94, $966 million. In 1994-95 the cut will be $1,205 billion. It is a sad state of affairs.

Mr. Speaker, speaking of this bill, one cannot overlook the fact that there are people in need, that there are problems in our society. And again, going back to the National Council of Welfare, no federal government has ever intended to forget about its commitment towards the disadvantaged people. I repeat, up until now, no government has ever intended to give up its commitment towards the disadvantaged. The conservative government is doing it and is likely to continue to do so. What a shame! It is absolutely unacceptable!
Our society has all the powers, all the resources needed to ensure that all families have enough money to provide food, clothes and a home for themselves. All this government needs is a sound management. As far as I am concerned, I will speak again, when I have the opportunity, to the incapacity of this government to even look after the day-to-day business! They are unable to do it and I think it is quite sad.


Marlene Catterall: Mr. Speaker, I want to thank my colleague from Ottawa-Vanier for a very thoughtful and thorough discussion.
What has become clear in his and in other speeches on this bill is that we have significant readjustment of society going on here in which those who are doing very well continue to do better, thank you, and those who are not doing so well will be worse off.
That is happening in a number of domains. We see the deficit and the debt used as the excuse for depriving those who most need the support of society. We see a continual move toward the privileged class and an under class in Canadian society.
I wonder if my colleague might care to comment on the kind of mismanagement of the finances of the country that he feels lie behind this trend which I think Canadians in general reject totally, having been always a society that was committed to sharing and to the development of the potential of every individual Canadian.
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I wonder if the hon. member for Ottawa-Vanier would have some more comments on that.


Jean-Robert Gauthier: Mr. Speaker, I thank the hon. member for her question.
I wish I were in my office. I have a paper there which I read recently which said that the rich are getting richer and the poor are getting poorer.
To sustain that statement, it showed that the rich have more disposable income today in 1991 than they had four or five years ago. That is possibly due to some Tory policy. Maybe that is the name of the game, but the poor's share of the national pie, if I may call it that, is going down.
I am saying to this government: Show some heart. Be caring about Canadians. Do not cut into the social programs of this country. It is the wrong thing to do.
Over there I know there are sensible people who have their hearts in the right place. I appeal to them to vote against this bill because this is the start, the erosion, of our national framework of understanding among Canadians and that basically is that we share the good times and the bad times. We should share with those who are having a hard time at this time. There are 1.5 million unemployed out there, and possibly .5 million who have left unemployment insurance because they cannot get it any more.
My colleague from Gander-Grand Falls knows all about that because he has a high unemployment rate in his riding. It is a sad state of affairs when you cannot get a job. That is what Canadians are asking for, not more, not less. Get them a job.
Here we are talking today about cutting into those programs which help those people who cannot get a job, who have no unemployment insurance but have to depend on social assistance programs. I hope this government comes to its senses and votes negatively on this measure.


Mr. Derek Blackburn (Brant):: Mr. Speaker, I am pleased to enter the debate this afternoon on Bill C-32, an act to amend the Canada Assistance Plan, which in effect will extend to 1995 the 5 per cent cap that has already been imposed upon federal transfer payments in the social welfare and social services field.

September 23, 1991
Government Orders
The government brought forth the original bill and is now bringing forward Bill C-32 with the argument that this will help the country somehow turn around this horrendous public debt which it has accumulated over the years, will reduce the current account deficit and, through fiscal restraint, will put the government books back in order.
On the surface this is a compelling argument. Whenever you mention the evils of debt to individuals, to families, to family heads, you immediately get a very positive response and people will agree that debt is a bad thing, that debt has a very negative impact, as we say today, on one's emotional or psychological health, and that debt is something that drags the family or the individual down and drags a nation down.
Nations have been living with debt for a long time. While I am not saying that debt is a good thing, I think we have to look at the causes of debt and a whole variety of ways of dealing with its reduction. I will get to that in a few minutes.
As I approach the main subject of my address this afternoon, I wish to remind my hon. friends of certain characteristics we have developed in this country with successive governments down to but not including the present one through which we have established a way of life in this country, at least until a few years ago, that was considerably different in many respects from the way of life of our American friends and neighbours to the south.
We have chosen to put community first. We have chosen to use government fiscal policy to redistribute wealth. We have chosen to establish programs financed by the federal government to assist people to cope with day-to-day problems, problems related to public education, problems arising out of the concerns of those who manage public transportation, public health and health care, which we call medicare in this country, and the social services in the country to help those who are less fortunate or who fall upon adverse times in their personal lives, such things as workers' compensation at the provincial level, unemployment insurance at the federal level, even to the point of using federal funds to retrain people for the ever changing work place.
All of these things cost money. In Canada, at least until a few years ago, Canadians were prepared to pay the bill through their taxes, whether they were federal or provincial or municipal taxes. In the last two or three years this whole assault on the public debt by this
government, revolving around fiscal restraint to bring down the public debt, has created a fear in the country that we cannot spend anything any more, or that these very worth-while programs have to be curtailed or reduced and some actually eliminated.
I do not think the people opposite, our colleagues on the government benches, really understand the social impact, to say nothing of the emotional or psychological impact, that this deficit fighting is having on our country. While we may be reducing current account deficits a little bit each year, the public debt in this country on the one hand is increasing. It is now estimated that it will be at least $400 billion by the end of this fiscal year and possibly $420 billion. On the other hand, a lot of these social programs that made Canadians different from the United States are now being subject to market force constrictions or marketplace limitations.
In other words, this government wants to treat social problems the same way as a corporate financier or a corporate manager would treat a corporate problem.
I am suggesting to you, Mr. Speaker, that that cannot be done because what is happening-and I have said this before in other speeches similar to this one dealing with social and economic issues-is that this is leading to an assault on the middle class. It is leading to an assault on middle class institutions. Public transit, for example, is being destroyed by government policies. VIA Rail is one specific example, as is the cabotage problem in terms of the airlines and the privatization of Air Canada. These are basically middle class institutions.
In our public school system, while we do not see decay at this point, we do see a tremendous negative impact in terms of financing. What the federal government does not provide directly or indirectly from Ottawa the local ratepayers are having to cough up at the municipal or local levels in order to keep their schools open and their high schools functioning.
We have the problem of public education. We have medicare, where it is being suggested that user fees be introduced in order to defray a portion of the cost. I can afford user fees, but medicare was originally used to help all of the people, particularly the disadvantaged and low income earners as well as the middle income earners. When you bring in user fees all in the name of fiscal restraint, you are mounting yet again another assault on
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a community based program. The community here of course being the entire country.
This government is doing everything it can to attack the middle class and middle class institutions. You may think this is somewhat outrageous, but all one has to do is look at what is happening in the United States with the same marketplace orientation to solving social problems. There you do see the decline of public transit, of public schools, of public or state universities and colleges in some areas of the United States.
Of course they have never been able to come to grips with public or state sponsored medicare. That is why you have such a divergence in private insurance programs in that country.
By way of introduction I simply want to say that we should be very careful in assessing the psychological, emotional and social impact of legislation such as Bill C-32, all in the interests of sharpening our pencils and balancing budgets. A country is not made up entirely of a budget. It is not made up entirely of dollars and cents. It is made up of people who have people problems, and we have to bring more to those problems than simply an accountant's approach, more than just a business approach. There are some things in this life that the marketplace cannot handle. The marketplace cannot handle many of the social programs that we and our predecessors on both sides of this House have fought for for years to improve the standard of living for our fellow citizens.
I cannot help but see in Bill C-32 yet another plank in this government's right wing corporate agenda. It is just one more piece of evidence that the corporations, the tax system, the rich in this country are not going to be hurt or hindered by this deficit-either the national account, the national public debt or indeed the annual current account deficit. It is really an attack on those least able to cope with the financial problems, both at the personal level and at the national level today.
The 5 per cent cap on government spending on social programs through the Canada Assistance Plan continues, but we have been running inflation rates in excess of
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5 per cent for the last two or three years. Some have come in just about 5 and then 5.2 per cent. The deficit this year is expected to go as high as 6 per cent on the total annual basis.
How does this impact on the provinces? If the inflation rate is 6 per cent and the cap is at 5 per cent and we are in a recession where more people are unemployed, there are lower tax revenues coming in at the provincial level and lower corporate tax revenues coming at the provincial level. It means that the provincial governments, particularly Ontario which has been hardest hit by this recession, as well as Alberta and B.C., will probably have to borrow. In fact Ontario has had to borrow on the public money markets in order to find the funds to pay the increase in costs for these social measures.
And we saw a deficit budget that came in, in Ontario last May, projected to go as high as $9.7 billion. But of that just one item, $1.6 billion, was the direct result of the cap on the Canada Assistance Plan-$1.6 billion. There was about $2 billion that the previous Liberal government had not even accounted for. There is about one-third of that budgetary deficit right there.
I suppose Canadians would not mind all that much if everybody were asked to pay his or her fair share of taxes in order to cope with these deficits. But that is not the case, as you and I know, Mr. Speaker. For example, during the years 1986, 1987, 1988 and 1989-four boom years in this country when corporate profits increased by 34 per cent-the corporate taxes in this country declined by 20 per cent. Now we are not expecting corporations to pay higher taxes during periods of economic downturn, when sales are down, productivity is down, when they are going through layoffs, adjustment or rationalization programs or whatever the buzzword is now. But those were boom years, four or five years in this country when profits soared by 34 per cent and corporate taxes went down, down, by 20 per cent.
But during those same four years those in the second lowest income bracket, the second lowest quintile I think they call it, saw their personal taxes go up by 1.1 per cent. In the highest quintile, the highest 20 per cent of income earners in this country, their income taxes went up by

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only .9 per cent from 1986 through 1989 inclusive. The second highest group went up by only .3 per cent.
Now, is that tax reform? Is that the way it should be? Should those who are in the lower income bracket see their taxes go up the highest while those in the upper income bracket see their taxes go up at a much lower rate? That is not tax reform. That does not give credibility to this government. That is one of the major causes for discontent in this country today and one of the major reasons why this government is stuck at 12 or 15 or 16 per cent in the polls.
It is because of the unfairness of the government's programs. It masquerades as reformers, and when you cut through all the fancy words and language you find out that whatever the reform is it is not fair. What it is doing, either in the name of fiscal restraint on the one hand, or in promotion of the private corporate sector, the private corporate sector is not paying its fair share of the costs.
For example, Bill C-32 is going to slash transfer payments to the provinces in the field of social programs, but of this whopping deficit that we have only 6 per cent is caused by spending in the social envelope. According to Statistics Canada-and that first figure I gave was from Statistics Canada-tax breaks to the rich individuals in this country and to the corporations accounted for 44 per cent of the debt in this nation. Today, those rich people in this country and those corporations have the same loopholes of tax deferment that were existent in the laws of the land 10 or 15 years ago. They can still shelter their taxable incomes and they can defer spending their taxes forever and ever. Corporate lawyers know this.
There is no point talking about a minimum tax in this country. We have not got it for that matter, as long as you have tax loopholes where you can defer paying your taxes. Corporations still list tax deferments, not on the liability side of their annual reports but on the asset side. They are using tax deferments as an asset. Nothing can be more blatantly obvious as proof of my argument.
This government is misleading the people of this country again by saying that we have to tighten our belts in the social envelope to get the debt down, and yet only 6 per cent of that debt is caused by spending in the social
envelope of social programs and 44 per cent of the debt is caused by tax breaks to the rich and by corporations being able to defer and write off all kinds of moneys that normally should go in the form of tax revenue to the federal government.
What we are seeing is not only an assault on middle class institutions and middle income earners and low income earners, but this is having a very negative effect on the people as a whole. They are turned off by government. They are turned off by lies by politicians. They are turned off by duplicity. They are turned off by programs that are supposed to be reform programs but turn out only to be masquerading as reform programs, bringing in more and more unfair and inequitable pieces of legislation that affect people differently. The rich are getting richer, as the saying has always been, and the poor are getting poorer.
This Conservative government seems to be powerless to do anything about it. It knows its time is running out, perhaps at the most a year or a year and a half to go in this Parliament, and it refuses to see and appreciate the problem. We also realize that this particular Conservative government under this particular Prime Minister is probably the most ideological Conservative government, in fact the most ideological government I would suggest that this country has had in the 20th century, certainly since R. B. Bennett. I do not think there is any question about that. If it does not fit the marketplace then it does not fit period; that is its motto.
Privatization, deregulation, the free trade agreement as it was written, the GST which is a tax that hits everybody equally at 7 per cent-it could be 9 per cent or perhaps on the eve of the next election it might even be 5 per cent-are all measures that will actually widen the disparity between those who possess and those who do not possess, between those who have a reasonably comfortable life and those who have a life of constant struggle.
Is it any wonder that the premier of Ontario, not in an ideological way but in the interests of promoting national unity, has suggested that transfer payments, medicare and social programs are just too damned important to be left in the hands of any one single government, that they should be enshrined in the new Constitution, and that we should have a social contract or a social clause in our Constitution?
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It is not just rhetoric. It is not just words. It would at the very least give all Canadians, rich and poor but particularly the poor and the middle income earners, a guaranteed vested interest in that Constitution to make certain that the Constitution comes forward and that we maintain national unity in this country, whether it is francophone or anglophone, whether it is in New Brunswick or in Alberta.
That is what this party is pleading for. That is what the premier of Ontario is suggesting. I commend it to this government and to the Prime Minister and to the Minister responsible for Constitutional Affairs.
I see that my time has run out, Mr. Speaker. I thank you very kindly.


Mr. Steve Butland (Sault Ste. Marie):: Mr. Speaker, I think my question will become more or less a comment because the member in his speech has probably answered all the questions that anyone has in this House.
I know the members across the way have not been looking up, have feigned their disinterest and are working away at what they are doing. I know perhaps that they are somewhat embarrassed and ashamed because they certainly would concur with what my colleague has said about the clawback on old age pensions and the end of universality as we know it.
I pay particular attention to the medicare that we are so very proud of in this country. It is so ironic that just the other night I was watching a program that came from the United States narrated by Walter Cronkite who suggested that one in four bankruptcies in the United States is a direct result of medical care: one week in a hospital, $10,000. One in two Americans do not proceed to get the attention that they would require for their medical problems for fear that they cannot afford it. Twenty-five million Americans cannot afford any insurance. Lo and behold, if you do get ill and access the insurance program, you can surely bet that they will cut you off in short order.
It seems strange that we are cutting our medicare program or taking a very serious look at that through user fees, and the Americans on the other side are trying to emulate us. They have actually studied the program and said we are more efficient: "We would like to have what Canada offers". This is sold under the guise by the party in power that it is not an attack on social programs. It is just that we are going to spend more wisely.
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The member pointed out the competitive agenda, the market driven agenda. This government says that it is the have provinces that we will not get the transfer payments for. We will reduce transfer payments to Alberta, B.C. and Ontario. I do not know if Ontario can be considered a have province. When you do not transfer to the province then the province must transfer to its municipalities. In the case of my municipality or the riding that I represent, Sault Ste. Marie, just last week the province of Ontario had to give $4 million to the city of Sault Ste. Marie just for back taxes that the Algoma Steel Corporation cannot pay.
The feds just say: "Oh, well, it is provincial jurisdiction because Ontario is well off". We resent that statement very much.
As far as the social contract is concerned, the European Economic Community suggests that a social contract is in order. Why would we not have one in North America?
Before I lose the good graces of the Chair, I do not know if the member would want to elaborate any more on what he has already done.


Derek Nigel Ernest Blackburn: Mr. Speaker, very briefly, I think the main reason why the European community has been able to insert the social contract into the constitution of the European community is because of one man, Mr. Jacques Delors, who I believe is the president. Mr. Delors also happens to be a French socialist. He was determined that the European community would not be dominated in its economics and its economic dynamics by countries like Germany or his own country of France or the United Kingdom or Italy, or the more advanced if you like. He was taking into consideration families and workers, men and women in countries like Portugal, Spain originally, and Greece.
He said: "We do not want to create an economic union here and a trading pact where great multinational and trans-national corporations can trade off countries, where they can say fine, we will locate in Portugal if we can get labour burden down to $5 an hour U.S. We will relocate from Germany down there for the cheap wages". "No", he said, "we are going to contract up so that the poorer countries in Europe will be able to pay higher wages and will stimulate their economies and

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their standards of living upward so that nobody can take advantage of and exploit the poorer countries in that organization".
We are in negotiations now with Mexico. I have nothing against Mexico. I love it. It is a beautiful country and I love Mexican people. It has a dynamic culture. What are we doing? We are not putting any safeguards in there for our working families or for American working families. Trans-national corporations are doing it now, racing down to Mexico to exploit Mexican workers at a much lower cost or labour burden to them, which is going to have a profound disruptive impact on the Canadian and American labour markets.
In Europe, Jacques Delors said: "We do not want that and they are not going to get that". Here we are in North America, falling prey once again to that corporate agenda of which our Prime Minister is a slaving supplicant. He sees nothing else but that in his thinking.


Peter L. McCreath: Mr. Speaker, it is a pleasure to rise to participate in this debate today on Bill C-32, an act to amend the Canada Assistance Plan.
I have listened with great care and interest to the remarks of my colleagues on various sides of the House. I cannot help but think that there is a fair bit of misunderstanding as to what is going on, not only in this House but in the government, with the finances of the nation. I could not help but be impressed as I prepared these remarks in reviewing the progress that the government has made over the last seven years in coming to grips with an extraordinary financial mess that it inherited seven years ago from its predecessors.
I have to say this as a member from rural Atlantic Canada, an area that benefits tremendously from federal government expenditures, an area that is greatly concerned about the unity of our country because the breakup of our country would leave Atlantic Canada isolated from the rest of the country. We are highly dependent on the Government of Canada.
That is one of the reasons that we are not too thrilled at the kind of rhetoric that is coming out of the Reform Party these days, when it talks about reducing expenditures across the board by 10 per cent and when it talks about getting rid of things like ACOA, reducing equalization, reducing veterans pensions and old age allowances. My goodness, we are talking in this debate here about capping the Canada Assistance Plan, the growth and expenditures to three provinces so that they can only grow by 5 per cent. We wonder what would happen if the Reform Party and Mr. Manning came into power and everything was cut by 20 per cent. It is a pretty scary prospect for Atlantic Canadians, I must say.
What we have here is a piece in a very well ordered and well structured financial plan to bring back into order the finances of this nation, to ensure the confidence that is so essential in controlling things like interest rates, the rate of inflation and the value of the Canadian dollar that ensures the flow of investment to this country, investment that is the basis for jobs.
There are not walls around the country, but investment and sound finances. Those are the things that are important.
This bill is part of a financial package that really began in 1984, but most recently follows in line with the budgets of 1990 and 1991. I must say I commend it to all members of the House as we come to consider it here today, and indeed in the days ahead.
I think it is important to remember that the finances of this country were very much out of whack. In 1984, we had achieved an accumulated national debt of $200 billion.
Even more frightening was the fact that the national deficit was $38 billion. It had been allowed to run rampantly out of control. That $38 billion actually included a $16 billion operating deficit.
It is important to understand the structure of this debt. The government of that day was actually spending $16 billion more each year than it was taking in. In addition to that, it was paying $22 billion in interest on that $200 billion national debt.
I have people say to me: "What progress have you people made on the deficit? You have only brought it down from $38 billion to $30 billion." On the surface that is true, but let us look at the structure of the debt.
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We are now running the government on a $12.5 billion surplus. That is a $28.5 billion turnaround. How has that turnaround been achieved? A certain amount of it has been achieved through increased revenues resulting from tax reform.
Some would say, by increasing taxes. I am not sure. It is more a question of taxes reflecting the growth in the economy. Even more important, it has been achieved through a 70 per cent reduction in expenditures by the Government of Canada.
That is management. That is tightening the belt. That is leading by example. I heard some of my hon. friends earlier saying, as some people say: "Ah yes, but the national debt has doubled since you people have been in power. What accomplishment is that?" Of course, they are hoping that nobody will dig a little more deeply to understand the structure of that debt, because it is a very simple thing.
If you take a debt in 1984 of $200 billion and you do nothing towards bringing that debt down and if you take, say, an average interest rate of 10 per cent per year even though the interest rates were much higher in the early 1980s, even in 1989 and 1990. Through the sound management of this government, I am pleased to note that interest rates have gone down 5.5 per cent in the last year, which is going to be of great benefit to the Canadian economy.
If you compound a $200 billion debt for seven years at 10 per cent and if you just add it up, what does it get you? It gets you $389 billion. If you want to be a little more accurate, it is probably about 11 per cent, then you compound it and you end up with a debt of $415 billion.
Members opposite say that this government has doubled the debt. This government has not doubled the debt. This government inherited a $16 billion operating deficit, turned it around to a $12.5 billion operating surplus. By getting the finances of the nation under control, we are gradually going to get at that $400 billion debt that is the legacy of the Trudeau Liberal government to Canadians.
Thank goodness we have had a government which had the courage and the integrity to tackle that debt. There is no question. Every politician in this House knows that it is much easier to get yourself popular by giving money out than by taking it away. That is the situation.
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When we talk about capping the Canada Assistance Plan, what exactly are we dealing with? Speaking from the perspective of an Atlantic Canadian where we are so highly dependent on things like equalization and transfers to the provinces, it is very simple.
If the Government of Canada is going to tighten its own belt, if the Government of Canada is going to do something-


The Acting Speaker (Mr. DeBIois):: I apologize. I have a point of order.


Mr. Simmons:: Mr. Speaker, there is really no need to apologize. It is quite a legitimate point of order.
My good friend from South Shore is in full flight and all that, but I am sure he would want to recognize that in the energy of the moment, he misled the House.
He talked about a $400 billion legacy of the Trudeau era. He will be aware that the public debt at the time his cronies took over was $180 billion. It is now $400 billion. I will not sit here, Mr. Speaker, and have that member deliberately mislead the House and I suggest you invite him to withdraw.


The Acting Speaker (Mr. DeBIois):: Order, please. It is a matter of opinion. Debate.


Peter L. McCreath: Mr. Speaker, I am sure my hon. friend from Burin-St. George's will wish to perhaps make his point, invalid though I happen to feel it may well be, when we come to the questions and comments. There is no question that if you take a $200 billion debt-actually it was about $199 point something billion in 1984-85, so my hon. friend might check the budgetary figures and then come back in time for questions and comments and he can make his point.
I would invite him to compound the interest for the last seven years on that debt that the government of which he was a member, left as a burden to the taxpayers and the young people of this country, and come back with an accurate figure of what that debt is, if he wishes to try to dispute the reality of the fact. What we are left with as Canadians is roughly a $400 billion debt. That is a legacy of the government of which he was a member. However, he can come back with the accurate facts and figures if he believes that mine are not accurate.

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I was saying before this euphemistic point of order was raised that in controlling expenditures, if roughly 25 per cent-maybe it is 24 per cent or 26 per cent; I would not want to run afoul of my hon. friend opposite- of the expenditures of the government are in fact transfers to the provinces, then what is more reasonable than if we are going to confine expenditure growth, that it should apply equally to transfers to the provinces as to the expenditures and the programs of the Government of Canada itself.
It is important to note that it is not as if this government has not significantly increased the transfers to the provinces. For example, this year total federal transfers to the provinces in cash and tax points will be some $37 billion, up from what was $25.6 billion in 1984-85, which is an average annual growth rate of 5.5 per cent.
At the same time, federal government program expenditures have gone up an average of only 3.7 per cent. This government has asked nothing of the provinces that it has not done in greater measure to itself.
Costs cannot be controlled unless expenditures are controlled. Indeed, if the provinces are not prepared to control their expenditures, but simply feel they can rely endlessly on the Government of Canada to meet their shortfalls, maybe it is appropriate in the interests of the taxpayer that the Government of Canada exercise some control and then leave the provinces free to go beyond that if they so wish.
I listened with interest to the premier of Prince Edward Island on the radio the other day. By the way, he is in contravention of a federal-provincial agreement, refusing to provide legal assistance to anyone charged before the courts. Indeed, there was some suggestion that it would be appropriate that the premier of Prince Edward Island, who is also the attorney-general, be cited for contempt of court. He made the statement in what seemed to me a semi-serious attitude, you know, an unhealthy semi-serious attitude, that what difference does it make if the federal government has a big debt? So what if the federal government has a big debt and the provinces do not have very big debts. So what. The federal government should just continue to let their debt grow. It is all the same taxpayer, he said, it is all the same taxpayer.
Well, if it is all the same taxpayer, let the province that wishes to spend the money, generate the money and
answer to the taxpayer for it. This government wants the taxpayer and wants people beyond this country, the investors who are so important to the future of this country, to know that this government acts in a fiscally responsible manner and is going to endeavour to control the expenditures that it brings down.
Are the social programs of Canada put under siege by this government? Some, of course like the immediate speaker before me, the hon. member for Brant, suggested that social programs are under attack. I would suggest that we are not going to have social programs in the future if we bankrupt the nation. At what point does the nation cease to have the ability to govern itself when your national debt is a third of your expenditures as is the situation now? Is it when it is 50 per cent of the expenditures? At what point does the International Monetary Fund come in and say you are not responsible to govern yourselves?
Those are questions we might ask.
The accumulated debt of the provinces in this country is considerably less than the accumulated deficit which was estimated at $30.5 billion last year. At the same time that of the provinces is $9.4 billion.
Where is the Canadian taxpayer federally? You know 33 cents on the dollar is going to pay interest on the debt. What are the situations in the provinces? The average is about 11 cents on the dollar. It would seem to me that we need to tax the provinces which are not paying their fair share. When we look at the provinces that are impacted by this legislation they are not the provinces that are in the greatest financial need. It does not include provinces like the Atlantic provinces, Quebec, Manitoba, and Saskatchewan. What is the situation in those provinces? In Alberta it is 8.3 cents, 11 cents in Ontario, and 4 cents in British Columbia. That is the percentage of expenditures that goes toward the debt. Yet they say that the Government of Canada should continue to run up a debt.
Maybe that is why the Government of Canada has run up a debt because of uncontrolled spending by the provinces.
It is interesting to note that the figure 9.4, which is the combined deficit of the 10 provinces of Canada, is soon going to be blown out of the water by the actions of our friends in Ontario, Mr. Rae and his spending approach. It is going to be interesting to watch. As a Nova Scotian, I am greatly concerned about what happens in Ontario

because Ontario has such a major impact on the economy of this country as a whole and indeed on the economic numbers. Things like inflation and interest rates are driven very largely by what goes on in Ontario.
The message is going out across the land that the Government of Ontario is going to spend, spend, spend with no regard for where the money is going to come from. The Government of Ontario is determined to put that province and the future generations of that province in a financial situation such as this country might have been in had there been no change in approach. If the $38 billion deficit that was inherited here in 1984-1985 had been allowed to continue, we would have a deficit of some $100 billion in this country today. I suspect that if Mr. Rae does not come back down to earth and recognize that he has to exercise some responsibility in the way he governs his province, what we are going to see is Ontario doing its best to rival the federal government in the size of its deficit.
I do not know what the future of that would augur. It will be interesting to look at the reaction of businesses to the proposals in Mr. Rae's budget. I cannot help but wonder what we can expect down the road. I heard earlier today one of my hon. friends from the New Democratic Party pulling out the old saw about the free trade agreement leading to lost jobs. I wonder if he is going to be prepared to stand up and honestly face this House as businesses leave Ontario running from Bob Rae and his approach to economics and the potential impact that they are going to have on the economy of that province.
As new industries, such as the one the Minister of Finance was speaking about today, and new opportunities develop in this country, and as our economy generally becomes stronger I am sure that my friends opposite in the New Democratic Party will continue to try to find opportunities to blame anything that goes wrong on the free trade agreement, even though there is no validity to it whatsoever.
Coming back to the bill more specifically, I think we should take cognizance of the fact that what we are talking about here is limiting the growth of expenditures. We are not talking about cuts. We are talking about limiting the growth of expenditures. There will be no limit on the growth of expenditures in the provinces where the need is greatest. But there will be a 5 per cent ceiling on growth in the three most affluent provinces, at
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a time when it is important to note that the Government of Canada as part of its budget is also limiting growth in expenditures in federal government programs to 3 per cent. What we have going down here is that the government is being far more generous to British Columbia, Alberta and Ontario than it is being to itself.
What constitutes unreasonableness? Some provinces have resources at their disposal, limited deficits that they either have or inherited when they came into power and limited tax dollars that they have to allocate to paying interest on their debts. If they feel that their growth should exceed 60 per cent more than the federal government is allowing them and the federal government is allowing themselves, then let them find the resources for the revenues.
It amazes me how often I listen to people in this place and elsewhere suggest that the government should spend more money here and spend more money there. They say: "Let's expand this program. Why are we limiting expenditures here and limiting expenditures there? Are they proposing that we further increase the federal deficit, or are they going to propose new tax increases or new taxes?" Sometimes my friends from the NDP will say: "Tax the corporations". That is the solution to every problem. Bob Rae is going to find out he won't have any corporations left to tax if he keeps going the way he started out. There has to be an element of realism. That is what this government has provided, in the way of financial policy, an element of realism in its approach.


Derek Nigel Ernest Blackburn: The Tories in Nova Scotia.


Peter L. McCreath: It is very interesting. I should not allow myself to be distracted, but I do wish to comment. One of the really excellent things that has happened in the last year is that we have a government in Nova Scotia under the leadership of the hon. Donald Cameron. He is taking the finances of the province under control to make sure that he does not pass on to future generations of Nova Scotians the type of cycle of debt that exists in the federal government and has taken us so many years to bring under control. It is tough to stand up and take the tough measures, to do what seven governments have responsibly done, one of them being Nova Scotia, and indeed what the Government of Canada has done. We feel that we have a responsibility to the person who pays the piper and that is the taxpayer of Canada, whether

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they be from Newfoundland, British Columbia or anywhere else in between.
It would be nice to be able to say spend away all you want, there is no limit to the bottom of the well, but unfortunately there is. We have a government in Canada, a government I am proud to support, that is standing up for Canadians, future Canadians as well as present Canadians, in seeing that our finances are brought under control. One of those areas is the Canada Assistance Plan, and I encourage all members of this House to join me in supporting this excellent bill.


Derek Nigel Ernest Blackburn: Mr. Speaker, I enjoyed listening to the hon. member's speech. However, I want to remind him of just a couple of things.
He accused Premier Rae of spending, spending, spending. The reason why the deficit in the province of Ontario increased so quickly in one year is twofold: (1) the previous government had hidden the facts of the decline in revenues to the tune of about $2 billion and (2) this government, by pulling back through the cap on the Canada Assistance Plan, cost them another $1.6 billion.
But the point I want to make is this: I would like to ask the member how he accepts the fact that this plan will tighten belts and help to reduce government expenditures so that they can get the deficit under control, as he put it, when he knows that under present tax laws $6 billion a year go untaxed at the corporate level in this country-$6 billion.
Second, would he tell this House who would he ask in the province of Ontario to pay for the 14 per cent increase in welfare? Ontario has been severely hit by recession, has lost somewhere in the neighbourhood of
300,000	jobs, largely because of free trade and the high dollar that has been imposed on this country by this government. Would it be ordinary tax paying Canadians on their property taxes, or would it be ordinary taxpayers in their provincial taxes in Ontario? Who is he asking to pick up the tab for that increase of 14 per cent in social welfare payments alone in Ontario?


Peter L. McCreath: Mr. Speaker, of course I listened. My hon. friend asked many questions. It is difficult to know where to begin, but I am glad to see that he has not forgotten the rhetoric that has been sort of the gospel of the New Democratic Party for the past three years.
The member says 300,000 jobs were lost from the free trade agreement. I would like to see some accurate estimates of those figures. It is very interesting. I noticed those figures came from a study done by the Canadian Labour Congress. I am really intrigued with the fact that if you look at those figures and you break them all down, you see jobs lost in the Atlantic fishery included there. Is that not interesting? The number of fish in the ocean decreases and guess who is to blame? The free trade agreement.
Some of those job losses are in the tobacco industry. Significant thousands of Canadians have ceased to smoke, so the demand is less. Blame that one on the free trade agreement.
The big area, of course, that the NDP likes to talk about are the reductions in the automobile industry which, of course, are not a part of the free trade agreement. They have the auto pact to look after them.
We can talk about the brewing industry which is a part of those numbers. The brewing industry is explicitly left out of the free trade agreement.
My hon. friend, it is like anything else, you hear enough figures and you know enough of them are wrong that you wonder about the other ones.
My hon. friend is looking for a comment on the dollar and I would be pleased to comment on the dollar. There are two ways to deal with the dollar. I have to tell you, in all honesty, my particular constituency is highly dependent on exports to the United States. I honestly have to tell you that we, on the south shore of Nova Scotia, would very, very much like to see a substantially lower dollar than we have today, but what do we do? Do we have the Government of Canada decide the value of the
September 23, 1991

dollar or do we do it the way it is supposed to be done? The dollar is high because people outside this country have so much confidence in this country. Is that not a remarkable turnaround from what I hear from my friends opposite.
When we talk about exports, the lower the dollar of course the more we can sell. However, we have to look at competitiveness. We live in a new world. We do not live in the 19th century. We are moving rapidly toward the 21st century and we have to be ready to compete. We have to look at our own productivity. We have to look at wage rates. We have to look at how many people are involved in the process.
They talk about pricing differentials between Canada and the United States and they like to blame it all on taxes or something like that. Well, taxes might be a little piece of it. You then look at the amount of profit taken by retailers, the amount of middlemen along the way, the cost of production, but it is great to be able to poll something in isolation and say: "Ah ha, that is the problem, there is the bogeyman."
The reality with the dollar is that the dollar is high because of international confidence in the Canadian economy. You do not have to take it from me. Look at the reports of the OECD and other internationally respected bodies that look at these things. The fact of the matter is that the high dollar hurts us right now in some areas where we export, particularly exports based on our resources, but it also challenges us as Canadians to become more competitive.


Steve Butland: Mr. Speaker, I do not suggest there is any hope that the member is going to answer any of the questions from this side of the House.
If we can get back on topic with regard to the free trade agreement and social policy, it was the Prime Minister who said that the free trade agreement would enhance social programs in this country. This is a redundant debate and a redundant bill. It is totally unnecessary.
Getting back to the question from the member for Brant, he said: "Who is going to pay in Ontario?" I cite my community again where the federal government said: "Here is a CAP." Sault Ste. Marie, in dire straits, the largest employer in the community cannot pay municipal
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taxes, $4 million. Who is to pay? The province transferred the funds to the community. The federal government does not participate.
Sault Ste. Marie is not alone. In northern Ontario the unemployment rate is 15 per cent. Who pays? I want the member to answer that question. If the federal government is not going to participate, what role is it going to play and who pays?


Peter L. McCreath: I will very briefly answer, Mr. Speaker, because I know our time is just about up. There is a very simple answer to the member's question. The taxpayer pays.
The question is, at the same time the Government of Ontario must manage its affairs with the resources that are available to it. If the demand on the Ontario government in this particular area is greater, well then maybe it has to take a look at expenditures in other areas. That is exactly what this government has done. That is what the individuals you speak of in their homes have to do. That is what I have to do in my home. If I spent 15 per cent more than I took in every year, I would be in real serious trouble.
You have got to cut the cloth according to the pattern. The answer is very simple. The taxpayer is going to pay. It is just as well that it be the taxpayer or the guy making the expenditures as somebody else's taxpayer, but the bottom line is that the public is saying to the governments of the day and to this country: "Live within your means just as we have to as citizens".
I suggest that the Government of Ontario needs to learn that lesson. It could have no better model than this government and the Minister of Finance who is with us here right now.


George Baker: Mr. Speaker, I have just a few words on this legislation which is called an act to amend the Canada Assistance Plan. In effect, what it does is reduce the amount of money that is transferred to the provincial governments, three provincial governments in this case, moneys that they use to spend to provide housing for the elderly in the case of a senior citizens' complex or a nursing home. At the end of every month the provincial government, which guarantees occupancy m those nursing homes and senior citizens' complexes, that are subsidized by the govern-

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ment, sends in a bill to the federal government and the federal government pays a percentage of the cost.
This bill will reduce the amount of money. It will put a cap on the Canada Assistance Plan. It will put a cap on the CAP. Well, the cap on the CAP not only covers the senior citizens' complexes, but it covers every amount of money that is given out to people under what we call social assistance, and what some people refer to as welfare.
It caps the CAP in three provinces. Why does it do that? The hon. member for St. John's West is here now and he is saying: "Yes, it does this in three provinces".
The reason why this bill is being brought in, I believe, is because they have already put a cap on the other provinces. They have already put a cap on everything that can be capped. In other words, in the riding of the hon. member who interjected a few moments ago, in his province, the federal government has said this year: "We are going to reduce the amount of money that we transfer to your province. We are going to cap it at 3 per cent".
In other words, in the operations of a hospital or in the money for universities, they have been capped as well. To get at the other three provinces which are not given equalization payments, the government decided to cap the CAP. Now everyone is capped. In other words, the cost of running hospitals is capped, the administration of post-secondary institutions-our universities, trade colleges and vocational schools-is capped and now the social assistance departments are capped as well.
When their moneys are capped at 3 per cent or 5 per cent, it means that they cannot pay salary increases of 10 per cent, 7 per cent, 6 per cent or 5 per cent. They cannot buy new machinery and increase the costs of running hospitals.
The hon. member for the NDP made reference a few moments ago to medicare and a program by Walter Cronkite. I saw that particular program. It certainly was a sad hour to watch. There were people who had received two or three treatments of chemotherapy for cancer. They were left not being able to go back to the doctor or the hospital to receive further treatments of chemotherapy because the insurance company said: "Too bad, we are not going to insure you again unless you pay us $20,000 or $30,000."
It was a sad program to watch, and it was a sad reflection on how the United States of America takes care of some people who are caught in the bind of not having a system like we have in Canada.
In that program it gave the numbers on the most modem types of machinery that we have in our hospitals to take care of our sick. It gave examples of a machine like a CAT scan, and it gave the numbers for the United States as compared to Canada.
It was very clear that in the United States they were farther ahead of Canada with the machinery and the new modem methods of dealing with and detecting a disease than we in our hospitals.
I was thinking as I watched that program that we have many instances of that. We have our provincial administrations today and the federal government really costsharing to send a great many people to the United States for treatment on various types of machinery in hospitals that we do not have here in Canada, or that we do not have enough of.
I was dealing the other day with a case of somebody who needed the use of what is called a lithotripter machine. That is a machine that is available in Halifax, Nova Scotia, at the Victoria General Hospital. Of course, that is overworked so the provinces send patients either there or to another hospital to where that piece of machinery is.
How can a hospital or a provincial government buy all of that machinery and expand on its facilities when they have been capped by the federal government, when their amount of money has been reduced by the federal government?
The same thing applies to post-secondary education. Here, in this bill, we come to another bad case of reducing money to people who cannot afford to be caught.
Can you imagine, Mr. Speaker, how difficult it is for somebody to live on social assistance today in this country? You can compare the amounts they receive for social assistance right across Canada and you discover that the amounts vary from province to province.
As a general rule, a single person would get about $120 a month to live on. If you are living at home, that varies $70 to $90. The provincial governments certainly cannot afford to cut back any more on those people who are on social assistance.
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The federal government, along with these bills, turned around and discontinued the extent of our direct job creation programs.
In other words, Mr. Speaker, you cannot now get on a direct job creation program unless it is connected with the unemployment insurance fund. You have to be drawing unemployment insurance in order to get on to a works program.
What the provincial governments have done is come up with their own program to try to put people on unemployment insurance in order to save money through their social assistance grants and programs that they have available provincially.
The federal government has done this, as the hon. member said a few moments ago, in the name of attacking the national debt. We just dealt with a bill before this Chamber that imposed a 7 per cent tax called the GST and then established a special fund to retire the national debt. That argument presented by the Government of Canada to reduce the payments for social assistance across Canada does not apply today because it claims that now the new GST will do the job for it.
The federal government has even gone beyond capping amounts of money to provinces. Because of this bill passing through the House, three provincial governments will now have to pay money back to the federal Treasury, either in an outright cheque for millions and millions of dollars or they will have to do what the federal government has done with the province of Newfoundland for this year, and that is have the provinces pay back so much at the end of every two weeks.
In other words, for all of this year the province of Newfoundland is sending a cheque off to the federal Treasury to pay back what the federal Treasury claimed was an overpayment made to the province of Newfoundland over the last three or four years.
Perhaps we will see the same thing happen here. Not only are they being capped, not only are they being limited in the amount of money being transferred to them, but they have now been asked to pay back money that was granted to the provinces three, four and five years ago.
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I think the federal government should have learned a lesson by now and admit that it cannot cut back in these areas. Of all the areas that could be listed to cut back in, you should never, ever touch health care, education and social assistance. Of the three areas, our hospitals and post-secondary institutions unfortunately have become places for only the well-to-do in our society, the very well-to-do.
The way our student loan system has been structured and now taxed by the Government of Canada, it is very difficult for somebody to go to university unless they have lots of money in the bank or parents who have lots of money to give to them. Now it is attacking not only our hospitals, our students, but the poorest of the poor, our senior citizens and their accommodations and our poor people who are on social assistance today and who cannot make ends meet.
The Government of Canada should hang its head in shame and withdraw this bill and pay to the people on social assistance what they need to keep their heads afloat with all of these new taxes we have circulating in this country.


Roger Simmons: Mr. Speaker, I did not realize that my good friend from Gander-Grand Falls would say so succinctly what he said so well.
However, if you will just give me a moment here, I will get organized.
I thank my friend, the distinguished former Speaker of this Chamber for the coaching. I need all the help I can get at this particular point, as I am sure he is aware.
As my friend from Gander-Grand Falls was saying when he was in full flight a few moments ago, this is just the latest attempt, not an isolated attempt but the latest of several attempts by this government to hoodwink a lot of people.
I recognize the government does not have great difficulty hoodwinking the member for South Shore. He has a vested interest in being hoodwinked.


An hon. member:: He is hoodwinkable.


Roger Simmons: I am far more interested in the people who are being directly pounded into the ground by this particular piece of legislation. It sets about extending that cap on the Canada Assistance Plan.

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The devastation that this government is wreaking on ordinary people across this country needs to be quantified if that is possible. If we could only bring before the House some specific examples of how people are being pummelled by this particular government.
Let me give just an example that I ran into this week. It is not under the ambit of the Canada Assistance Plan, but it is a parallel example that I believe will drive home the point that I want to make here.
I was in the home of an individual, a college student, this weekend in a small community on the south coast of Newfoundland, a community of about 200 or 300 people. This young woman is the daughter of a fisherman who had a fair to middling year, not a good year. He has caught some fish and he is still working but he has no great amount of income. Notwithstanding, when that young individual went to apply for a Canada student loan she was told that given her circumstances and those of her father and so on, she would qualify, not for the $900 or $1,000 which she wanted but for $155.
Point number one: the reason she is qualifying for such a measly amount is because this government has not changed the basic ground rules since 1984. It has not kept up with inflation over those past seven years. Whatever an amount was worth in 1984, it is certainly not worth the same amount seven years later given the effect of inflation. To begin with, it has not changed the ground rules. That is quite another story, an important one but another story. On to my example.
This young woman was informed that she qualified for $155 to help her through her year at college, $155. She is going to appeal that, and we will help her. In the meantime, she trots off to the local bank a few miles down the road to get her $155. As she is about to sign all the forms and to receive the $155, which is several hundred dollars less than she was hoping she would get, the bank people said to her: "There are a few more details. Before we can give you the $155 you owe us $4.65". She wanted to know what that was for. That was the tax. That is the 3 per cent tax, another of the several taxes this government has put on education. The goods and services tax is also a tax on education. There is a theme on which we could go for some time.
My friend from South Shore has a nice term for everything. People these days call janitors or whatever sanitary engineers. Is that right? He is the kind of individual who goes around inventing fancy terms to put a nice face on some pretty despicable stuff. He can call it what he wants, but I call it a kick in the guts for students. That is what I would call it. Instead of engaging in sweet phrasing, when is he going to start fighting for those students in his own riding who must be pummelled by those taxes?
Let me continue with the example. I am sure he would be interested. He looks at least amused by the example, so let me continue.
This young woman is asked for $4.65 before she can get her student loan. She was told it was a federal government tax on student loans. So she said: "Take it off the $155". "No, we cannot do that. The rules do not allow us to do that. You have to give us the $4.65 first and then we will give you the $155".
She searched around in her purse and scraped up $4.65 and she passed it across the counter.
The bank is not finished with her yet. There is one more wrinkle. It said: "Now that you have paid us the $4.65, we have got to send it to the government. So you have got to buy a money order to send the $4.65 to the government". She searched around in her purse some more and $1.50 later she has got her transaction completed. To get her $155 loan which is only a fraction, only one-sixth of what she needs in the first place, she has to pay a tax that the finance minister and the boys have dreamed up for $4.65. Then to get that tax into the hot little hands of the Minister of Finance, she has got to turn around and buy a money order, another $1.50.
What are we trying to do in this country? Are we trying to drive those young people stark raving mad before they ever get in the door the first time to further their education? I say to my friend in the NDP that the one thing that they will not make of those people are Tories. They are working on alienating those people completely. They are working on running them out of rural Newfoundland or rural Canada and in the process they make every waking moment just as miserable as they can.

Think of the example that I have given. To get $155, she pays $4.65 in federal tax, a student tax, a tax on education, and then she has to turn around and buy a money order to send the tax off to the government.
There must be people over there who sit up nights saying: "How can we make it even more miserable tomorrow than it is today for the ordinary people out there? How can we do something to aggravate them, to drive them clean up the wall, to drive them stark raving mad?" This bill, this cap on the Canada Assistance Plan, while not as dramatic as the example I just mentioned, is in the same vein. It is of the same ilk. It is crafted by a bunch of warped minds that are so out of touch with reality, the reality of life for people out there in Newfoundland, in rural Canada and all over this great country, once great country which is only a shadow of its former self, thanks to what the gentleman from Baie Comeau and his clique have done with it.
People all over this country are hurting. They are hurting and it chooses this time to bring in this kind of a bill, this kind of a double whammy, this kind of a kick in the guts.
I was going to say I do not understand what makes this crowd over there tick, but then I do. It is that philosophy, that right wing agenda that somehow says: "If through no fault of your own you don't have a job or if for reasons of personal or whatever kind of misfortune you don't have adequate access to income, enough to keep body and soul together, if you happen to be in that category, tough luck". It is called, kick them while they are down.
If we were to characterize the approach of this government toward poor people, toward the disadvantaged generally across this country, it is kick them while they are down. The thing that really boggles my mind and tears at everything that is in me is how otherwise decent men and women can sit over there and be the unwitting parrots to this kind of nonsense, this kind of cruelty. How can they be party to perpetrating on poor people across this country what this bill seeks to do and what this government seeks to do on a daily basis?
The only surprise is that this crowd is at 12 per cent in the polls, that it is that far up. That is the only surprise.
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Peter L. McCreath: Seventeen on Monday.


Roger Simmons: "Seventeen on Monday", the member for South Shore says. Enjoy it while it lasts. I say to him: enjoy it while it is up there at 17 per cent. It is a temporary situation if the people of this country continue to have the kind of basic horse sense that I know them to have. They will not stand by-


An hon. member:: -another part of the horse.


Roger Simmons: I think the member is much too kind. The member for South Shore should get his seat moved so he can be a seatmate of the member for Burlington. He would make the member for Burlington look good. Now if that is his attempt at wit he is half way there.
Mr. Speaker, we are talking about what we can do under the aegis of the Canada Assistance Plan to help some of the ordinary people of Canada. The best that my friend from South Shore can do is sit here and dream up some more insults. He needs a few more lessons from the member for Burlington because the member for Burlington is light years behind him. But he is definitely going in the right direction and he should work on it-or, I should say, he should not work on it.
Mr. Speaker, who is going to benefit from this bill? I say the same people that the Minister responsible for Constitutional Affairs rushed out to call today, the Business Council on National Issues, his buddies in business. That is part of the right wing agenda; move away from the ordinary people every last nickel and dime you can, so that the well to do people in this country have ever-increasing amounts of disposable income. Do you know that if you were poor in 1984 when this government came to power and had an income of under $25,000, your taxes have gone up in the seven intervening years by $1,200. But if you are in another category, if you had an income of $100,000 or more, your taxes have gone down by $1,600 a year since 1984.
The member for South Shore is having trouble absorbing that, but that is not a surprise to me. He should check his facts. The advice he gave me-and I rushed out and I checked my facts and, as usual, he was absolutely right; the public debt in 1984 was not $170 billion, it was $167 billion. So I was off by a mere $3 billion. He now bids for $199 billion; do I hear $200 billion? Because whether we are talking $167 billion, $170 billion, or whether we are talking $199 or $200 billion, my point stands, that the debt now is over $400 billion and no amount of fiddling around with compound interest or double talk or insults will change that. The public debt since his administration took office has more than doubled. That is the point I was making to him. He skated beautifully.

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Peter L. McCreath: Compounding of the interest-


Roger Simmons: He skated beautifully. He had his chance to make a speech, Mr. Speaker, and I leave it to his constituents to judge how good his speech was, because I know that he did not spend a lot of time talking about their particular needs. He talked about the needs of his Prime Minister, but then again he is probably more interested in pleasing his Prime Minister than he is in pleasing his constituents. But I say to him that in the long run his destiny will be more decided by his constituents than by his Prime Minister, the former of whom are much more permanent than the latter.
Mr. Speaker, while the people in the Business Council on National Issues and the well-to-do people of this country, the cronies of the Minister of Finance and the minister of constitutional affairs and the Prime Minister, will benefit by this further shift in moneys away from the poor that are not so poor, who will really be hurt by this?
Mr. Speaker, I recognize your signal that my time has so quickly passed. I think it goes without saying that Canada's poorest people, the people who can least afford another kick in the guts, are going to get one when this bill passes. It will pass because the government will ram it through like it did the goods and services tax and like it has done with 31 other taxes since this government took power. There is no doubt in my mind that the bill will become law.
My only reason in rising today is to make a plea to some of the people over there who must realize that to tie their destiny to this particular sinking ship is foolhardy at best, but even that aside, in the interest of basic ordinary decency and compassion, recognize that this bill is one foul step too many.
If they want to look at themselves in the mirror tomorrow morning, they will be better able to do it if they vote against this bill first or at least speak against it.


Peter L. McCreath: Mr. Speaker, I listened with great attentiveness and care to my hon. friend from Burin-St. George's. I listened to
him talk about the people who are going to be disadvantaged by this legislation. It is interesting to observe that not a single Newfoundlander will be disadvantaged by this bill. Quite the contrary, Newfoundlanders will benefit from this bill because it is part of a package that is going to put right the disordered finances of this nation that were left as the legacy of the government of which he was a member.
We talked about the accumulated debt earlier. It was interesting to note in my hon. friend's remarks that he said: "If the Tories do not stop taking money away from people there will not be any Tories left." One of the reasons this country is in such a mess is that the philosophy of the Liberal government was: "Buy as many of them as you can for as long as you can." The Liberals left office in 1984 with a $16 billion operating deficit.
If my hon. friend had come into office in 1984 and he was the Prime Minister and the Minister of Finance all wrapped up into one and he inherited a $16 billion operating deficit and a $400 billion accumulated debt, what would his solution have been to this situation?


Roger Simmons: Mr. Speaker, the member in his last phrase or so unwittingly put a lie to everything he was saying. He should realize that the government which he supports inherited a debt of $167 billion. How many times do I have to say that to him? It was not $400 billion, it was $167 billion.
I heard the member say, Mr. Speaker, it was an inherited debt of $400 billion and it was actually $167 billion. Now he goes for $200 billion again. Do I hear $201 billion? In that example alone, it shows the member that if he is going to skate he should at least put the skates on. He should at least know how to do it.
The hon. member talks about inheriting an operating deficit of $16 billion. He is absolutely right, Mr. Speaker. These marvellous Tories with their wonderful machines have taken this atrocious $16 billion deficit-it weighed us down, it was horrendous, it was heavy, $16 billion- but thanks to him and his colleagues they whittled it down. It is no longer $16 billion, it is only $30 billion now. They got it all the way down from $16 billion to $30 billion.
September 23, 1991


The Acting Speaker (Mr. DeBlois):: Order, please. On a point of order, the hon. member for South Shore.


Peter L. McCreath: Mr. Speaker, I know it is not my hon. friend's intention to mislead the House, but we have a $12.5 billion operating surplus today from a $16 billion operating deficit when his party left office.


Roger Simmons: I just want to continue with the answer to my colleague's question. He made the allegation that no Newfoundlander would be disenfranchised or hurt by this particular bill. Of course, he knows that is not the case at all. This is the old, foot-in-the-door approach. Today it happens to be Alberta, B.C. and Ontario. But once the government gets its foot in the door on this one, and does it with the unwitting support of people like the gentleman from South Shore, then tomorrow the world. Where will it stop? Where will it stop once it is allowed to make an onslaught on one of the programs that has served this country very well and helped look after the poor and the disadvantaged people of this country?
We cannot stand idly by and have these people doctor a very good program in the instance of shuffling a few more millions of dollars over to their rich buddies so they can make the tax break even greater for the people in the $100,000 bracket. That is our concern. It has to do with how you distribute income in this country.
If every decision was based on the bottom line we would not need a government at all. Those who have, have more and those who do not, shoot them. I do not subscribe to that philosophy, but this crowd does. I am not going to sit around and let them bulldoze their way through here with more policies that move this government's agenda further and further to the right. It is absolutely wrong and it belies the real reason we have government in the first place.
One of the reasons we have a government is to redistribute income to people who do not have income. That bill is a step in the wrong direction and I am going to oppose it for that reason.


Mac Harb: Mr. Speaker, my colleague spoke very eloquently and quite extensively about the deficit and about the accumulated debt. I
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would like him to make a few comments about what this bill is going to do to universality, particularly when we are talking about health care and education.
I would like to bring to the attention of my colleague the fact that by the year 2004, there will be no transfer payments from the federal government to the provinces in the areas of education and health care. How can the government have any say in those two areas if it does not make any financial contributions to the provinces?
I want him to tell Canadians, in his view, whether that will weaken the ability of the federal government in setting standards when it comes to health care and also when it was talking about national education objectives.
I want to hear a few comments from the hon. member on the impact of this bill.


Roger Simmons: Mr. Speaker, I thank my good friend from Ottawa Centre. He makes the points very well.
First, on the question of universality and what it is going to do to people across this country who need dental care and disabled people who need living services, foster homes for abused children, places for abused women, child care for low income families, all services provided through the Canada Assistance Plan are under threat.
The member for Ottawa Centre talks about one of the much touted phrases of this government. He talks about national educational objectives.
Well, I say through him to this House: What a joke. Here is a government which, when it writes throne speeches or budget speeches can get much exercised by national educational objectives. I am a former educator and there are many sitting in this Chamber. Who of us will not say that we have become too compartmentalized. We have different objectives and different standards in little pockets all across this country and that has to change if we are going to be competitive.
Do I sound like the former Minister of Finance? These were his words, but he has never put his money where his mouth is.

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Now, with this bill and with other initiatives in this House, I say to my friend from Ottawa Centre, that former minister, the present Minister of Finance, the Prime Minister and the rest of them over there are militating against our having national educational objectives. They are militating against our having a national standard of health care.
That is the real reason we on this side will fight this bill. It is a foot in the door that we do not want to go through.


Cyril (Cid) Samson: Mr. Speaker, I welcome the opportunity to stand and to speak on this bill.
It is important that Canadians realize and know that the Canada Assistance Plan is the only way that the federal government transfers funds for the purposes of assisting in social assistance programs and social services. There is no other mechanism.
When we look at what this government is doing now, such as putting caps on this CAP, it is attacking our social programs. The Prime Minister said during his campaign debate that was a sacred trust. That is hypocrisy in the worst form. He campaigned strongly and clearly, saying: "This is a sacred trust. You have nothing to fear. The free trade agreement will not touch our social programs. You have my word on it."
So much for the Prime Minister's words, Mr. Speaker. The Canada Assistance Plan is being capped for the three richest provinces: Ontario, Alberta and British Columbia, the three richest provinces, which have 50 per cent of the poor within their boundaries. That does not make a lot of sense to me.
How do you explain to those people who are the poorest in those three provinces who send their children to school hungry and with clothes that are full of holes and shoes that are perhaps not fully soled? How do you explain to them that they have nothing to fear, that they live in one of the richest provinces in Canada.
It does not take away the pains of hunger. It does not take away the humiliation of the parents who have to go and ask for this welfare assistance. No, Mr. Speaker, quite to the contrary.
What this government should be doing is trying to help people to get back on their feet and to become contributors once again to this society. This government has an obligation to look at job creation programs.
We look at what is going on today in the country and we see thousands and thousands of people losing their jobs every day. They go to the unemployment office and try to receive benefits from the unemployment office, and they are told: "You did not work enough. You do not have enough weeks to apply. We cannot help you. Go to the welfare office."
Those same people who perhaps on occasion are able to collect unemployment insurance find out that the collection period is shortened. They are told: "Sorry, go to the welfare office."
The federal government is passing on its responsibilities to the provinces. At the same time, we hear the Prime Minister saying things to the premier of Ontario like: "The welfare roles are going up." It is no surprise, because he is washing his hands of the needs of the people of Canada.
The Government of Ontario is not ready to sit back and watch people starve. It is that simple. It is one thing for this government to say: "We have to show restraint. We need to have fiscal restraint. We have to get our deficit under control." On whose back are they doing it? On the less fortunate, that is whose back they are doing it on. By cutting back on those social programs in the form of CAP reductions, they are doing it on the backs of the Canadians who can least afford it.
We heard talk about the G-7 nations, the Group of Seven. There are a couple of notes I would like to read into the record just so that people understand a little more of what G-7 is all about. The G-7 is made up of the United States, Japan, Germany, Britain, France, Italy and Canada. Of the G-7 Canada has by far the highest percentage of total taxes paid from personal income, which leads me to the point of corporate tax. We hear people say that the NDPers are always talking about taxing corporations, always talking about passing the buck on to the corporations. It is not fair. Let us have a minimum tax for corporations.
We are then told that if you keep doing that the corporations are going to move to the United States. Let me remind you, my friends, that the United States has a minimum corporate tax of 20 per cent.

If we had a minimum corporate tax of 20 per cent here in this country, we could raise some $8 billion through that minimum tax.
Are we going to scare people away by saying we are going to have a minimum corporate tax? I do not think so because we see more and more that the manufacturers are leaving the country as it is. Why are they leaving the country now? We do not have a minimum tax. Why are they leaving? Why are we having so much unemployment in this country? It is because of the high dollar, the high interest rate policy that we have.
I would like to return for a moment to the social assistance program as we know it today. It is set up not to be a way for people to establish a lifestyle. Our social assistance program is a temporary measure to assist people when the need is greatest. It should not be institutionalized. We should not look to institutionalized food banks. We should try to find ways of getting people back to gainful employment.
That is the thrust of the message I am trying to get across here today. People in Canada are proud. They do not want a program of assistance to which they can adjust themselves to so that they can live free. No one in this country should get a free ride. Everybody has to contribute in one way or another.
I think that what this government should be looking at are more creative ways of creating jobs, of getting people back to work. I think that is going to be the solution to our problems in this country.
I have to restate that the burden of responsibility belongs on the shoulders of the federal government to assist the provinces in the continuation of these programs to aid those people who need it the most. Its corporate friends are not the ones who need it the most. The loopholes have to be closed in order to raise the funds that are needed to continue funding these programs. The federal government cannot pass its burden of responsibility to the provinces which in turn have no choice but to pass it on to the municipalities because that is where the welfare comes from, the ranks of the municipal taxpayers.
At the bottom line, I have heard people ask who pays. Sure it is the taxpayers who pay, but when you are taking 10 jelly beans out of a pot that has 15, or taking 10 jelly beans out of a pot that has 15 million, which one will you
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notice the most? If you are taking from the bigger pot, the effect is felt by fewer people. That is exactly what I am saying about this government. When we are drawing from the federal pot, everyone contributes and the effects are felt less strongly than they would be if they were taken from the municipal and the provincial pot.
Clearly, this federal government has missed the target altogether.
The federal government has said that it would like to eliminate child poverty by the year 2000. Is this its response? Is this the way it is going to do it? You cannot keep taking away and taking away and expect people to continue to survive.
I believe we need some restructuring. We have to look at our tax structure to ensure that we all pay our fair share. No one in this country would object to paying their fair share. But the imbalance we have today is a bloody nightmare. There are people paying 7 per cent who are making millions. There are people who are paying 35 per cent who are making peanuts. There is a severe imbalance.
We have to look at our training programs so that people can adjust themselves to the technological change we see taking place in the country today. People on unemployment insurance are running out of benefits and are not receiving training. I get any number of calls in my office from people telling me that they have an opportunity for a job. They have gone to the Canada Employment Centre and asked for some training to do this job, only to be told that it does not fall within the parameters of the training program being offered by that office.
I had one incident where a person came to me and said: "I have a job driving heavy equipment. I need two months training. The employer gave me a letter telling me that I have the job". He showed me the letter. "I have the job and I need two months training, but he will not pay for the training. If I can get the training through UI, through the Canada Employment Centre, I have the job".
He went to the UI and he was told: "Sorry, that does not fall within the parameters of our retraining program". He did not get the job.

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There are instances where the system is inflexible and it will not adapt itself to the needs of the people. We have a system where we have to adjust to the system.
When we look at single industry towns where there is limited opportunity for employment, what is this government doing to diversify that economy? What is it doing?
FEDNOR is an excellent program. I have no shame and no hesitation in commending the government when I agree with a program it has. FEDNOR is one of those programs. I have told the minister that it needs some flexibility, that it needs a broadening of the base and needs some changes. I wrote him a letter and as far as I know, he agrees and it is something that is being looked at.
A the same time, when we look at the retraining program through the UI, that is a whole different picture. "Sorry, that is not what we are looking at. That is not what we want to do. That does not fit within the parameters of the mandate". Well, what are the parameters of the mandate? What is it we want to do? We want to put people back to work. We want to get them off the social assistance programs. People in this country want to work. They do not want social benefits. But by God, if they need them they should be there. They should not be told: "I am sorry, but the pot is empty. So you go hungry. You do not meet the guidelines. You go without". That is not what this is all about. There is approximately $1.6 billion going to the Ontario government in Canada Assistance Plan money. That is an indication that there is a severe need for a restructuring of training, of where we are going. Is it the intent that we become a welfare state? It seems to me that that is where we are headed. More and more people are out of work and less and less is being done to help put them back to work.
Statistically, if my information is correct-and I have no reason to doubt that it is-if you take a person out of the work force for a period of two years, you have a very slim chance of getting that person back into the work force. That person will at that point have adjusted himself or herself to a system of social assistance where they have changed their lifestyle. They have learned to do without. They have learned to cut back. They have learned to tell their children: "I am sorry, you just cannot go to the show this month. Maybe in a couple of months we will save enough money that you can go to the show". They have adjusted themselves to that kind of a program.
That is not acceptable to me. That is not acceptable to any Canadian. Canadians want to work.
When we look at the whole question of CAP, at social assistance benefits, safe houses for battered women, the children's aid societies, when we look at any other government funded agencies that are funded through the Canada Assistance Plan, that is funded by the federal government in which that is the only way the federal government participates, I cannot accept, I will not accept that this government should be allowed to put a cap on it.
If the need is there, the funds should be there to assist on a temporary basis and, more important, we should be looking toward a better job creation program so that these people can become proud once again and contribute in the way they want to contribute to the economy in Canada.


Hon. Tom Hockin (Minister of State (Small Businesses and Tourism)):: Mr. Speaker, I would like to ask my hon. friend a couple of questions. Ele has tried in his speech to point to new sources of income for looking after those disadvantaged in our society. I appreciate the importance of the subject.
I want to question him on the two proposals he had which were pretty substantive. The first was the suggestion that we get rid of all loopholes in the Income Tax Act so that we can produce more revenue to look after the lower income people in Canada. We have, as the hon. member knows, since 1984 pruned from the Income Tax Act just about every loophole that the Liberals have put in there.
The scientific research tax credit was the worst. Almost $2 billion had been siphoned out of the taxpayers' hands through that scheme. The last one that we got rid of was the flow-through shares scheme which was important for the mining industry. What would he say? Does he support the removal of flow-through shares because that is a loophole which we did remove?
My second question has to do with taxing corporations, having a minimum tax on corporations. We have in Canada now over one million taxable corporations. A large number of them are sub-companies of larger holding groups. Therefore if you tax them, you would be taxing them once as the entity itself and once as the holding company. Is he in favour of taxing twice?

The second group of corporations that are not taxed are corporations that have loss carry-forwards. They have lost a whole bunch of money for two or three years, and they finally make a profit. They put the past years' losses against the profits and they are not taxable. Does the hon. member want to tax companies with loss carry-forwards?
In the third group we have over 800,000 companies in Canada with sales of less than $200,000. Is that who he wants to tax? There are not really very many companies left that do not pay tax, that really are worthy payers of tax in my view, so I would like his answers to those two questions.


Cyril (Cid) Samson: I would like to thank the hon. minister for his question because I think they are veiy important.
First of all on flow-through shares, as the minister very well knows the original flow-through share program as we knew it was severely flawed and there was severe abuse.
The second Canadian Exploration and Development Incentive Program, CEDIP, was also somewhat flawed but a little less than the flow-through shares.
No, I would rather support quite clearly what industry is asking for now which is an adjustment to the cost price of a flow-through share. That would then give them money to continue exploration and create jobs.


Thomas Hockin: For all corporations.


Cyril (Cid) Samson: I have never said I was opposed to assisting companies, corporations, call them whatever you like, that want to create or continue and expand employment.
If the loophole does nothing more than take the money and put it in their pocket and walk away, I am sorry I do not support that, and I do not think the minister does either.
What I am saying is that if we are going to create employment, if we are going to ensure the continuation of employment, then there definitely should be some assistance, but not if it is only to put money in their pockets.
On the question of double taxing of corporations, clearly a fair taxation system is what I have always
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wanted and what the New Democratic Party has always wanted, fairness and equality. Thx profitable corporations. If they do not make a profit clearly you are not going to tax them. That would not be fair. I do not think anyone in our party has ever said to tax companies that are going broke or to tax people who are closing shop or to tax people who are trying to create some employment but are having some difficulty. We never said that. I do not think anyone here has ever said that. I certainly have not.
When I made my comment about raising $8 billion in additional taxes, when I mentioned the 20 per cent minimum corporate tax, I was quoting from memory but I have the article here from The Financial Post in January 1990. They said: "$8.2 billion in additional revenue could have been raised in 1987, if a minimum corporate tax of 20 per cent had been in effect". This is for all profitable corporations.
I think I have addressed the questions of the minister and the evidence is there.


Mr. Sid Parker (Kootenay East):: Mr. Speaker, I too would like to ask a question of the member for Timmins. With regard to what is happening with the capping and so on, does the member agree with the proposal that has been put forward by Premier Bob Rae of Ontario to bring in a social charter that all governments in the future would have to recognize? Does he see that there is a need for social programs in Canada, particularly when we see food banks at the extent they are, when we see governments cutting back in social programs in the very areas they are needed most? Possibly at this time, when a constitution is being debated, it is time for a social charter to be adopted across Canada to identify those problems and ensure that they are looked after by all governments.


Cyril (Cid) Samson: Mr. Speaker, I thank my colleague for his question. I certainly do agree with Premier Bob Rae of Ontario. We have to ensure that when the need is there-and let us be honest that it will probably always be there- the program that is required to assist these people is there as well. We have to ensure there is some kind of protection for these people when social assistance is required and that they do not have to get down on their knees and go begging hat in hand. We have to ensure that they are protected and that the children in particular are protected.

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I applaud Premier Bob Rae for his initiative. I certainly hope that he will get the support of all the premiers and of the Prime Minister.


Ronald MacDonald: Mr. Speaker, I am busy on my feet today because there is a lot to be said about the government's economic fiscal and legislative program that it has put in place.
Earlier today I talked about the inequity in the government's approach to wage parity. I think this particular bill, Bill C-32, is another example of how this government has lost absolute control over its own agenda.
I remember just a very few years ago when I was running in my first election campaign federally in 1988. Goodness knows and God forbid, it sounded like if you elected a Conservative government again there was not going to be one chicken in every pot but there was going to be two chickens in every pot and a bigger car in every driveway.
I specifically remember the former Minister of Finance indicating clearly that the deficit was under control, the economy was under an expansion period, and saying "just elect us one more time and we are going to give you everything you ever dreamed of".
The people of Canada may have got sucked in back in 1988, but it is pieces of legislation like this, Bill C-32, that will ensure, as my hon. colleague from Newfoundland said, that Tories are going to be an endangered species after the next election.
What this government clearly has done is to dismantle the social system, the social network, that social net that we have built in this country over generations. We have always believed that this was a country, even with crazy geography and even with the inequities that we see in this country, rich enough that government had a role to play in ensuring that it did not matter where you lived, it did not matter how rich or poor you were, that you had a right to expect certain things and certain standards and programs.
This government has completely abandoned the promises of its 1988 campaign, promises of prosperity. Lots of prosperity has happened. I checked with Reverend Chang in my constituency, a minister who is very active in trying to help those who need that extra special hand in times of need, the poorest of the poor. Lie tells that he
does not know what has happened, but for some strange reason that economic miracle has not hit some of the people in my riding or the people in ridings in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec and all of the Atlantic, because we have never seen as many hungry people going to food banks. We have never seen so many people cut off from the economic greatness of this country. We have never seen church basements with so many people lined up looking for food for their children.
Where is the prosperity? What kind of an economic agenda has this government followed?
Let us look at it. Back in 1988 we were told that another term of Toryism, another term with these people opposite in power, was going to change the country. Brian Mulroney said it best: "Give me four more years and you will not even know this country".
There are a lot of people in this country who would like to go back about seven years because what this Prime Minister and this government have done has been nothing short of disastrous and an abuse of the public trust that was put into this government. Prosperity is not bursting out all over. Poverty, dismay and disunity have been the legacy of this government.
We have Bill C-32. This bill talks about fairness. It says, sorry, but the poorest of the poor, those people who want a job, who want to contribute, who want their children to feel that they belong and who do not want to be on welfare, are the people who are going to have to bear the burden more than anyone else in this country of this government's economic mismanagement, of its foolhardy policies.
There was a member opposite, the member for South Shore, who would have done well to sit down because I hope his constituents heard what he had to say on this particular issue. Maybe Nova Scotia is not affected, but this is the thin edge of the wedge. Give these guys across the aisle an inch and they will take a mile.
I remember the former minister for ACOA from Central Nova Scotia. He was out there beating the bushes telling us how great things were going to be in Nova Scotia because this government was committed, sacred trust, to regional development. We certainly found out what that sacred trust did. That sacred trust saw in the first two years of this government, $1.14
September 23, 1991

billion-that is a lot of money-cut from regional development programs in Atlantic Canada.
What effect do you think that has? I guess this government thinks it has no effect. It has a large effect because the unemployment rates went up. We became less competitive in the fisheries. We have seen our manufacturing base decline. This government calls that a continuing commitment to regional development.
We have also seen this government, as it tries to inflict prosperity from coast to coast in this country, come up and establish program financing.
Do you remember the principle this country was based on? It was caring and sharing. We said we have this program, it is called Established Programs Financing, and that is put there to ensure that it does not matter if you are in a province like Newfoundland, which is having some economic difficulties right now, or Nova Scotia, or if you are in Alberta where things are in fairly good shape or were before this government got in power. EPF ensured that there were transfers to those provinces for health care and post-secondary education. That is pretty important. If I cannot feel like a first-class Canadian in any province, and know that I have access to first-class health care and first-class post-secondary education, then there is something wrong with this country. It has pulled a thread out of this country which has damaged the fabric forever.
Let us look at Established Programs Financing. What has it done with it? I am going to quote right here from a brief that was given to a committee of Parliament studying bankruptcy legislation. It is from the Canadian Hospital Association.
The Canadian Hospital Association says that the changes in the EPF formula that this government has done in three successive budgets have the following effects. The transfer of responsibility to some of Canada's poorest provinces as a result of the changes to the EPF are as follows: between 1986 and 199, this government is cutting from transfers to the provinces for health care over $29 billion, $29,998 billion. That might be okay if you are in a province that has not been devastated by a recession or this government's policies. It is not okay in those provinces that do not have that type of economic base. It means that either they are going to have to cut somewhere else where they cannot afford it or we are going to have two classes of Canadians: those who live in have provinces and can expect to get national standards
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on programs, and those who live in have not provinces. Adios amigo, too bad, move to Toronto if you want to get a good bed and a good hospital.
Concerning post-secondary education, in a 10-year period between 1986 and 1996 it has cut $12,109 billion from those cost shared programs.
I heard the Prime Minister one day, I think it was during an election campaign, by God, saying that these things were sacred trusts. He even used his mother as a prop for goodness' sake to tell the Canadian public he would not touch any of these things. My goodness, it was those dastardly old Liberals and NDP members when they were going out and saying elect this bunch again and your social programs are going to be gone.
The government ensured that it once again was able to fool the Canadian public, and now we have seen two and a half years of Tory policies dismantle the social safety net in this country.
If that was not bad enough, a year ago, I think it was in April 1990, this government's spending was out of control. It was collecting more in taxes than any other government ever had. I think at that point it had raised taxes over 30 times. The money was coming in hand over fist. These guys opposite were spending it faster than it was coming in. They had taxed the Canadian public to the limit.
If that was not enough, they then decided that they were going to change the way the equalization formula works. There was some obscure clause that would kick in at a certain point, but they did not bother to tell the provinces about it.
The result in April 1990 was that Canada's smallest province and one of its poorest provinces, Prince Edward Island, suddenly found itself when the Minister of Finance was about to put a budget down $13 million short.
I think $13 million in a big province is a lot of money. Put it in a province with 135,000 people and it is absolutely devastating.
Then just three weeks later the province of Nova Scotia, again a have not province, found out that because the government and the bright boys and girls at the Department of Finance figured out another way to squeeze the poorest provinces it was going to lose $65 million in its provincial budget.

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It is okay to say: "We have to share the burden here". If we are going to share the burden, why in the name of goodness do we not get to share the benefit when there are good times? We do not do that in places like Atlantic Canada.
This government comes in with its triple play, Bill C-32, the cap on CAP. If this government is allowed to go unchecked, it will not only ruin the economy but it will create a checkerboard Canada.
If you happen to live in a relatively prosperous region you can expect certain things. If you do not then you can expect not to have those certain things. Bill C-32, more than any other bill that has come before this place, is a glaring example of how this government has broken its social contract.
It is okay to say: "Ontario, you are kind of wealthy. Alberta, you are kind of wealthy. Maybe right now we are going to cap you". The problem is that the growing number of those who are unemployed and the growing number of those who find themselves in poverty are not capped. They increase every single day.
We are becoming more like Americans. We are trying to put a system in place here that rewards success. It absolutely throws those people who slip from the ladder of success into the trash heap. That is absolutely against every single thing that the Liberal Party tried to do in government and in forging a social contract with people of this country.
These Tories opposite sit back. With their smugness they say: "That is too bad. Let the poor people out there get jobs". That is the type of response you will get from some people opposite.
The fact is that the government has taken in more revenue than any other government. It has transferred the debt to the provinces. It has not given the provinces the capability for additional taxation because it has milked the public dry.


Mrs. Maheu:: It has put away half a million jobs.


Ronald MacDonald: It has put away half a million jobs.
We have had a free trade deal. Remember the wonderful free trade deal. The government opposite made it quite clear during free trade that it was going to be the panacea of everybody. There are going to be jobs flowing like milk and honey.
Just on the outside chance that there might be a job lost-you remember-it was going to have the most generous assistance program that the western world had ever seen. The minister walks behind me and says: "Yes". I hope he had a smile on his face and both fingers crossed, because he knows as well as every worker who has lost a job and an investment in their future and that of their family because of the free trade deal that it was simply not true.
This government's kamikaze economic policies have done more to separate us, to divide us, to categorize us and eventually, probably, to destroy this nation.
Bill C-32, as I said earlier, is the thin edge of the wedge. Today, maybe it applies to those provinces that this government in its warped sense of fairness feels can afford it.
Tomorrow, to my friend from Newfoundland who just spoke, it may apply to Newfoundland. The next day maybe it will apply to Saskatchewan or to British Columbia.
At some point, the federal government will absolutely shed like the skin of a lizard its responsibility to maintain those standards and that social contract with Canadians.
Even more important, what it is doing in places like Newfoundland, Nova Scotia and Saskatchewan is making those governments pay dearly for the consequences of the actions of this government.
Jobs are going, half a million jobs. It will be a million jobs by the time these guys are finished. The poor are lining up at food banks. It does not get any better. It is the dismantling of Canada, as my friend from Ontario says. It is the dismantling of Canada.
Bill C-32, as I said earlier I think is going to go down as one of the most glaring examples. I cannot wait until we get on the campaign trail, because Bill C-32 is going to drive this government, not to its knees at 17 per cent; it will drive them into the Smithsonian Institute, the Museum of Civilization across from here. Because after the next election Bill C-32 is going to be indicative of the decline and fall of the Tory empire.


The Acting Speaker (Mr. DeBlois):: Order. It being six o'clock p.m., pursuant to Standing Order 45(5)(a), the House will now proceed to the taking of the deferred division of the business of supply, pursuant to Standing Order 81(14).
September 23, 1991



Supply
++NAYS
Members


ALLOTTED DAY, S. O. 81-AGRICULTURE
[Stage Direction]
The House resumed from Thursday, September 19, consideration of the motion of Mr. Althouse (p. 2361.)
The Acting Speaker (Mr. DeBlois):: The question is on the main motion.


[Stage Direction]
Call in the members.

[Stage Direction]
Blenkarn
Corbeil
Kindy
MacLellan
Marin
Nowlan
Sobeski
Tobin
Cooper
Gray (Windsor West)
MacLaren
Manley
Merrithew
Proud
Soetens
Weiner
The Acting Speaker (Mr. DeBlois):: I declare the motion lost.

September 23, 1991
Supply On a point of order, the hon. member.	[Translation]


Mr. Brightwell:: Mr. Speaker, I was present in the Chamber and chose to abstain because this was essentially a vote on the motion that came out of my committee.	The Acting Speaker (Mr. DeBlois): It being 6.30 p.m., the House stands adjourned until 10 a.m. tomorrow, pursuant to Standing Order 24(1). The House adjourned at 6.28 p.m.

Tuesday, September 24,1991