1991-10-03

Hon. Gilles Loiselle (President of the Treasury Board and Minister of State (Finance)):: Madam Speaker, pursuant to Standing Order 109, I have the honour to table, in both official languages, the government's response to the third report of the Joint Standing Committee on Official Languages.


JUSTICE AND THE SOLICITOR GENERAL
Hon. Doug Lewis (Solicitor General of Canada):: Madam Speaker, I have to honour to lay upon the table, in both official languages, the comprehensive government response to the first report of the Standing Committee on Justice and the Solicitor General which dealt with the Parole Act and the Penitentiary Act.


SPECIAL JOINT COMMITTEE FOR A RENEWED CANADA
[Stage Direction]
Mr. Jean-Guy Hudon (Parliamentary Secretary to President of the Queen's Privy Council for Canada and
Minister responsible for Constitutional Affairs): Madam Speaker, on behalf of the Minister responsible for Constitutional Affairs and pursuant to Standing Order 32(2), I have the pleasure to present, in both official languages, the report entitled The European Community-A Political Model for Canada-La Communaute europeenne-Un modele politique pour le Canada.
I would ask that this document be referred to the Special Joint Committee of the Senate and the House of Commons on a renewed Canada which is examining proposals for the renewal of Canada in order to make recommendations to Parliament.
[.Editor's Note: See today's Votes and Proceedings.]

Mr. Bill Attewell (Markham-Whitchurch-Stouff-ville):: Madam Speaker, I have the honour to present, in both official languages, the report of Legislative Committee F on Bill C-10, an act to amend the Excise Thx Act and the Excise Act, without amendment.
[Editor's Note: See today Votes and Proceedings.] [Translation]


Mr. Hudon:: I rise on a point of order, Madam Speaker.


Madam Deputy Speaker:: The hon. parliamentary secretary on a point of order.


Jean-Guy Hudon: Madam Speaker, did you call "government's response to petitions", because I had some responses to table.


Madam Deputy Speaker:: That is usually done under "tabling of documents". Does the House agree to revert to "tabling of documents" in order to allow the hon. parliamentary secretary to table responses to petitions?


Some hon. members:: Agreed.

October 3, 1991
Routine Proceedings PETITIONS


GOVERNMENT RESPONSE
Jean-Guy Hudon: Thank you, Madam Speaker. Pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the Government's response to 12 petitions.
[Editor's Note: See today's Votes and Proceedings.]


DEPARTMENT OF FORESTRY ACT
Mr. Guy H. Arseneault (Restigouche-Chaleur) moved: for leave to introduce Bill C-306, an Act to amend the Department of Forestry Act and to make related amendments to other acts.


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


Some hon. members:: Agreed.


Guy H. Arseneault: Madam Speaker, I have the honour to introduce this bill whose purpose is to change the name of the department in the English version of the Act by replacing "Department of Forestry" with "Department of Forests".

As you may know, Madam Speaker, besides the name Department of Forestry being an inaccurate translation of the French, Ministere des Forets is misleading in fact. It may be taken to mean ministry of exploitation of our forests.

The proposed amendment will correct this deficiency while, at the same time, making the French and English designations of the department match.


Madam Deputy Speaker:: Mr. Arseneault moves that the bill be now read the first time and printed.


Some hon. members:: Agreed.
Pursuant to S.0.69(l), the notion is deemed adopted. Bill be read the first time and printed.


AN ACT TO DESIGNATE THE TORONTO-LESTER B. PEARSON INTERNATIONAL AIRPORT MEASURE TO ENACT
Guy H. Arseneault: for leave to introduce Bill C-307, an act to designate the Toronto-Lester B. Pearson International Airport.


Madam Deputy Speaker:: Pursuant to S.0.68(2) the motion is deemed adopted.


Some hon. members:: Agreed.


Guy H. Arseneault: Madam Speaker, I have the honour to table this bill designed to officialize the name of the Toronto-Lester B. Pearson International Airport.

The airport has been known for a long time as Lester B. Pearson International Airport. However, this name had never been given legal sanction.

The proposed amendment will have the effect of replacing the name "Toronto International Airport" with "Toronto-Lester B. Pearson International Airport".


Madam Deputy Speaker:: Mr. Arseneault moves that the bill be now read the first time and printed.


Some hon. members:: Agreed.
Pursuant to S.0.68(2) the motion is deemed adopted. Bill read te first time and printed.


PETITIONS
Mr. Ronald J. Duhamel (St. Boniface):: Madam Speaker, in accordance with the Standing Orders of the House, I have the honour to table a petition today on behalf of students from the province of Quebec, la belle province. They condemn the budget cuts affecting education, deplore the administrative tax on student loans and point out that in many cases, this tax applies to people who have to repay their loans in any case.
They also mentioned in their petition that this might be illegal, and they wonder how the government can talk about being competitive and at the same time slash education budgets. The petition also mentions the GST and other tax increases students must cope with.
October 3, 1991


Mr. Vic Althouse (Mackenzie):: Madam Speaker, I have a petition from a number of Canadians. These particular ones are from southern Ontario.
They note that grain and oilseed producers in Canada are experiencing the most severe shortage of cash flow in their history and that the new safety net programs do not bridge the gap between the old ad hoc programs in the crop year just completed last August.
They humbly call upon the Parliament of Canada to provide cash assistance as proposed by the House of Commons Standing Committee on Agriculture on August 29, which would have brought assistance up to the levels provided by the Gross Revenue Insurance Program and the Net Income Stabilization Account program.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Jean-Guy Hudon: Madam Speaker, the following questions will be answered today: Nos. 17, 45, 46, 47, 48, 58, 59, 60, 69, 70, 81, 82, 84, 85 and 101.


Mr. Milliken: To date, with respect to the constituency of Lac St.-Jean, Que., did the government propose expenditures of (a) $117,000 for a 3 year program for blueberry farms (b) $120,000,000 for regional development (c) $40,000,000 for new roads (d) $1,500,000 to upgrade a non-profit job creation centre (e) $40,000 for a study investigating the need to expand the Alma Airport (f) $56,000 for a feasibility study to examine ways to improve the Petite-Decharge River for tourism (g) $440,000 for wharf repair on the Saguenay, and, if so, for each project (i) has any money been spent and, if so, how much (ii) how much more money is projected to be spent (iii) have any projects been cancelled and, if so, which ones (iv) was any money spent before the project was cancelled and, if so, how much?


Hon. Harvie Andre (Minister of State and Leader of the Government in the House of Commons):: I am
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informed by the Departments of Agriculture, Public Works, Transport and the Federal Office of Regional Development-Quebec (FORDQ) as follows:
Insofar as the Department of Agriculture is concerned:
(a)	Yes, a federal/provincial contribution of $117,000 under the Canada/Quebec Subsidiary Agreement on Agri-Food Development, of which the federal share was $58,000
(i)	$52,650
(ii)	$5,350
(iii)	No
(iv)	No
(b)	Yes, a federal contribution of $571,690 under the Canada/Quebec Subsidiary Agreement on the Economic Development of the Regions of Quebec and the Canada/ Quebec Subsidiary Agreement on Agri-Food Development
(i)	$167,427
(ii)	$404,263
(iii)	No
(iv)	No
Insofar as the Federal Office of Regional Develop-ment-Quebec (FORDQ) is concerned:
(b) In june 1988, when the Canada-Quebec Subsidiary Agreement on the Economic Development of the Regions of Quebec was signed, the two governments set aside a regional development budget envelope of $120 million for the North-Centre region of Quebec, not just the riding of Lac Saint-Jean. In addition to Lac Saint-Jean, the region comprises the ridings of Roberval, Jonquiere and Chicoutimi, as well as a portion of the riding of Charlevoix. Funds in the $120 million envelope are provided on a 50-50 basis by the federal and Quebec governments.
As of May 1, 1991, the federal government had approved various programs totalling $55 million in the North-Centre region of Quebec, while the Quebec government had approved only $22.6 million in programs.
Federal commitments in the riding of Lac-Saint-Jean, to May 1, 1991, were as follows:

October 3, 1991
Routine Proceedings
Enterprise Development Program (EDP):
-Industrial Component $1,852,663
-Tourism component $430,985
A portion of these commitments has already been paid to applicants under these program components, and the balance will be paid over the next few years.
More funds will be committed and expended in the riding of Lac-Saint-Jean under these program components, but it is impossible to predict the exact total because these program components are intended to meet the requirements of the entire North-Centre region and this is reflected in their budgets, which are not broken down by riding.
(c), (d) Nil
(f) Under the Canada-Quebec Subsidiary Agreement on the Economic Development of the Regions of Quebec, the Federal Office of Regional Development (Quebec) has joined with the government of Quebec to fund the execution, by a qualified firm, of the study of the feasibility of cleaning up of pollution in the Petite Decharge River.
The objectives of the study are to assess the impact of log rafting on river water quality and to develop a pollution abatement and clean-up program with a view to preparing an overall development plan, including tourism development, for the Petite Decharge River.
i)	No payments have yet been made for this project.
ii)	A total amount of $47,440 instead of $56,000 should be disbursed for this project.
iii)	This project has not been cancelled.
iv)	Not applicable.
Insofar as Transport Canada is concerned:
(e) (i to iv)
The first study, entitled "Proposition d'agrandissement de Vaerogare d'Alma" was undertaken by Anicet Tremblay, Architect, Alma, Quebec in June 1988, at a cost of $15,000.
On March 1,1990, the Town presented the final report to Transport Canada Regional Officials. The study recommends the expansion of the air terminal building at a total estimated cost of $287,762.
When the study was received, Transport Canada Regional Officials supported the expansion project, in view
of the presence of two air carriers (Air Alma and Intair); however, it was suggested that the project costs be re-examined. In October 1990, Intair ceased operations at Alma Airport; justification for the expansion of the air terminal building was no longer valid. It is also essential that the Town negotiates the least clause giving Air Alma exclusive rights to utilization of the air terminal building.
Should the Town wish to proceed with the air terminal building expansion project, they will have to take these facts into account and re-examine the cost estimates and the findings of the feasibility study.
The second study entitled "Evaluation technico-econo-mique du projet d'allongement de la piste de I'aeroport d'Alma".
The objective of the study was to evaluate a proposal to lengthen the runway at Alma from 4,300 feet (1,310m) to 5,900 feet (1,800m). The study was completed in February 1989 by STRATEM INC. of Montreal at a cost of $19,500.
The study concluded that from an economic and technical viewpoint, lengthening the runway would be premature and the existing runway at the Alma Airport met both the existing and forecasted traffic.
Transport Canada completed a project to rehabilitate the existing runway (4,300 feet in length and 100 feet in width) at Alma Airport in October 1989 at a cost of $1,232,200.
Insofar as the Department of Public Works is concerned:
(g) The Department undertook a wharf repair project in the 1988/89 fiscal year in the electoral district of Lac-Saint-Jean, at Ste-Rose-du-Nord. The estimated cost of the repairs was $440,000. The final cost of the repairs was $470,910.


Mr. Fisher: How many cases emanating from the Public Service are before the
Canadian Human Rights Commission or Tribunal?


Mr. Robert D. Nicholson (Parliamentary Secretary to Minister of Justice and Attorney General of Canada):: There are presently 1,547 open cases before the CHRC or Tribunal emanating from the Public Service.


Mr. Fisher: How many cases have fallen under each of the ten grounds of
discrimination under Sections 5 to 14 of the Canadian Human
Rights Act?
October 3, 1991


Rob Nicholson: The Commission has accepted since 1986, 4,862 cases (according to the CHRC Data Base and including 815 cases that were accepted prior to 1986 that were still active).	
Sex	1133
Age	615
Race	480
Colour	93
National or Ethinic origin	378
Disability (mental or physical)	1496
Marital status	343
Family status	216
Religion	96
Pardoned conviction	11
Other	1
Total	4862


Mr. Fisher: What is the record of convictions under Section 59 (formerly Section 45) of the Canadian Human Rights Act?


Rob Nicholson: the 2 cases in which prosecutions were undertaken pursuant to section 59, one resulted in conviction (R. v. Villemaire and Applegate, April 29, 1988, Ontario Provincial Court).


Mr. Fisher: How many cases under Section 59 (as amended) of the Canadian Human Rights Act have been referred to the Solicitor General?


M. Robert D. Nicholson (Parliamentary Secretary to Minister of Justice and Attorney General of Canada):: 121 cases under section 59 (as amended) of the Canadian Human Rights Act have been referred to the Solicitor General.


Mr. Caccia: 1. Does the Sustainable Development Research Division still exist under the Department of Environment and, if so, (a) under which
Routine Proceedings
services (b) for the (i) fiscal year 1991-92 (ii) each fiscal year since its creation, what are the dollar and person-years resources?
2. If the Division no longer exists (a) why was it disbanded (b) what happened to the professionals within the Division?


Hon. Pauline A. Browes (Minister of State (Environment)):: 1 & 2. In December 1990, the federal government released its Green Plan. The Green Plan is an operational framework for the government's commitment to sustainable development.
During that same period, Environment Canada announced the appointment of an Assistant Deputy Minister-State for the Environment Reporting. This appointment underscores the importance the federal government places on environmental information. Concurrent with this announcement was the realignment of sustainable development policy functions from the former State of the Environment/Sustainable Development Branch (SOE/SD) to the department's Corporate Policy Group. This realignment is intended to ensure that all of DOE's activities are coordinated within an overall policy framework which embraces the notion of sustainable development.
The SOE/SD Division professional staff remain with the State of the Environment Reporting Service.


Mr. Saint-Julien: For each of the last ten fiscal years, has Radio-Canada entered into agreements with the Societe Radio-Nord Inc. du Quebec respecting the use of its antenna and retransmission and technical services and, if so, how much is Radio-Canada paying for these services (a) for each year (b) for each location?


Hon. Henry Perrin Beatty (Minister of Communications):: On occasion, it can be in the Canadian Broadcasting Corporation's interest to share facilities belonging to a private company rather than establishing its own facilities. When this is the case, the Corporation negotiates agreements to this end. This is in fact common practice in the broadcasting industry. Broadcasters often enter into agreements to use existing facilities, even those of competitors. In this respect, CBC has the following agreements with Radio-Nord Inc.
In Abitibi, where Radio-Nord has transmission equipment, CBC French radio and television services are available as a result of affiliation agreements with Radio-Nord Inc.

October 3, 1991
Routine Proceedings
In 1985, the Corporation concluded an agreement with Radio-Nord Inc. to use that company's transmission facilities in Rouyn to establish CBC English radio and television network services in Abitibi.
Also in 1985, in order to improve the quality of French television service in the Temiscaming region, the Corporation reached an agreement with Radio-Nord Inc. to improve its Fabre-Bearn transmitter. This transmitter feeds the CBC transmitter in Temiscaming.
In 1990, an agreement was concluded concerning the sharing of existing equipment in order to implement new FM radio services in Rouyn and Val d'Or. This agreement replaced a previous one dating from 1976.
With respect to the costs incurred (a) and (b), Parliament has not, as a matter of custom since the Corporation's creation in 1936, required CBC to supply, in answering Parliamentary questions, such details about its internal management and administration. Parliament has had two reasons for following this customs: first, the independence of the CBC as a Crown Corporation, established for the purpose of producing and broadcasting, independently of political or commercial interference, programs for a national program service; and, secondly, the competitive nature of many of CBC's activities. The appropriateness of the CBC providing certain categories of information has been considered on many occasions by various Parliamentary Committees and the CBC has suggested that such information should not be made a matter of public record, its views have been accepted. Names of staff members and their functions in relation to specific programs and the costs related to such assignments, as requested in Question No. 2295 answered May 20, 1975, are examples of details which it has not been customary to require the CBC to supply. It is open to Parliament to discuss the policies it and when the CBC have followed in this regard and it would be appropriate to review them when the CBC's estimates are before the House of Commons Committee on Communications and Culture.
The government makes available all information requested by members except where publication would be inconsistent with the mandate given to the Corporation by Parliament. This principle is well established and accepted with respect to information about government
agencies and Crown Corporations which are in competition with the private sector.


Mr. Riis: In May 1991 did the government host a buffet reception at the Canadian Embassy in Tokyo titled "The Art of Canada" and, if so, (a) how many attended the reception (b) what food items were served and at what cost (c) what alcoholic beverages were served and at what cost?


Hon. Barbara Jean McDougall (Secretary of State for External Affairs):: Yes, the Government hosted a buffet reception on May 27, 1991 at the Canadian Embassy in Tokyo titled "The Art of Canada".
a)	600 guests attended the reception.
b)	In addition to the hors d'oeuvre served at the beginning of the function, a buffet dinner consisting of beef, pork, fish, seafood, mushrooms, cheese, fruits and dessert was served. Most of the products were of Canadian origin but purchased on the local market.
c)	All the alcoholic beverages (wine, rye, whiskey and beer) served to the guests were provided for free from the Canadian companies. With regard to the cost, the caterer's bill for food and beverages totalled $61,989.77.


Mr. MacWilliam: How many complaints of sexual harassment have been lodged pursuant to the Canadian Human Rights Act by public service employees?


Rob Nicholson: From 1986 to 1990, there were 63 sexual harassment complaints filed with the CHRC against federal departments and agencies. It is likely that the overwhelming majority of these complaints were filed by public servants. However, exact figures cannot be provided since case information is not coded according to whether the complainant is a public service employee.
Pre 1986, sexual harassment case information is not available as the Commission information data base cannot provide this specific information for that period.


Mr. MacWilliam: How many cases of employer harassment, within the CRTC, emanating from charges laid under the Canadian Human Rights Act are before the Canadian Human Rights Commission or Tribunal?
October 3, 1991


Rob Nicholson: There are presently 3 cases of employer harassment filed against the CRTC before the Commission, of which 1 concerns sexual harassment and 2 are concerned with employer harassment on the ground of disability.


Mr. MacAulay: With respect to the Atlantic Fisheries Adjustment Package (AFAP) announced on May 7, 1991, has any of the $584 million been allocated to deal with problems in Prince Edward Island and, if so, (a) how much in total (b) how much has been spent (c) what projects or initiatives have received funding?


Harvie Andre: I am
informed by the Department of Fisheries and Oceans and the Atlantic Canada Opportunities Agency as follows:
Insofar as the Department of Fisheries and Oceans is concerned:
(a)	Funding for the Atlantic Fisheries Adjustment Program (AFAP) is not allocated on a province by province basis. However, every effort is made to fund proposals in all provinces based on priorities for AFAP. Allocations were made to Canso, North Sydney, Locke-port, Grand Bank, Gaultois, St. John's and Trepassey because these locations were affected by processing plant shutdowns. AFAP has $140 million over five years for economic diversification both inside and outside fisheries and residents of PEI can submit proposals for funding along with the other Atlantic provinces plus Quebec.
(b)	Approximately $114,000.00 were spent directly on fisheries diversification projects in PEI in 1990-91 mainly on aquaculture research.
(c)	Nutrition study on Arctic char; dockside monitoring; and a shellfish parasite study. There are over four million ($4 M) dollars in proposals for PEI now under consideration by ACOA and DFO.
Insofar as the Atlantic Canada Opportunities Agency is concerned:
Within the Atlantic Fisheries Adjustment Program (AFAP), ACOA is responsible for the Fisheries Alternatives Program (FAP). FAP is a Program directed at
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economic diversification outside the fishery sector. In relation to FAP, ACOA does not allocate funds provincially; however, the majority of funding will be directed towards Newfoundland which has been affected the most by fish plant closures.
In Prince Edward Island, ACOA has approved one project involving the Greater Summerside Chamber of Commerce. The $30,000 grant is being used to study the potential business opportunities as a result of the establishment of the Revenue Canada-GST Processing Centre on Prince Edward Island.


Mr. MacAulay: In Prince Edward Island, with respect to the Plant Workers Adjustment Program under the Atlantic Fisheries Adjustment Package (AFAP), (a) how many people will benefit from this program (b) what will be their benefit level (c) what are the names and addresses of the persons who have received money from this program?


Hon. John Camell Crosbie (Minister of Fisheries and Oceans and Minister for the Atlantic Canada Opportunities Agency):: In Prince Edward Island, with respect to the Plant Workers Adjustment Program (PWAP) under the Atlantic Fisheries Adjustment Package (AFAP), (a) preliminary estimates indicate that 25 people could potentially benefit from this program (b) benefit levels would be set at 70 percent of their UI benefits with a minimum of $500 and a maximum of $1,238 per month
(c)	no individuals have reveived money from this program to date. Final agreement on program funding and delivery, between federal and provincial governments, is required before implementation can proceed.


Mr. Butland: What is the rate of conviction for cases emanating from section 59 of the Canadian Human Rights Act being referred to the Solicitor General?


Rob Nicholson: For 121 cases referred to the Solicitor General, there were 2 prosecutions undertaken pursuant to section 59, one resulted in a conviction.


Mr. Butland: How many investigations under section 59 of the Canadian Human Rights Act have occurred?

October 3, 1991
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Rob Nicholson: 121 investigations.


Mr. Axworty (Saskatoon-CIark's Crossing): Since 1985, with respect to emigration from Sri Lanka (a) how many persons have been admitted under the program which allows persons with qualified relatives and others adversely affected by the situation in Sri Lanka to enter Canada (b) how many persons have been accepted under the current overseas procedures?


Hon. Bernard Valcourt (Minister of Employment and Immigration):: The following table outlines the number of permanent residents admitted under the Sri Lanka special measures program, by year and processing area.
Processed Processed
in Canada	Abroad	Total1985	134	352	4861986	48	226	2741987	48	265	3131988	7	403	4101989	14	318	3321990	26	141	167May 1991	13	28	41TOTAL	290	1,733	2,023


Jean-Guy Hudon: Madam Speaker, if question No. 12 could be made an order for return, that return would be tabled immediately.


Madam Deputy Speaker:: Is it the pleasure of the House that question No. 12 be deemed to have been made an order for return?


Some hon. members:: Agreed.


Mr. Caccia: Have any Cabinet policies been subjected to environmental impact assessments and, if so (a) who conducted each assessment (b) have any public statements been released and, if so, how and when were they released?
Return tabled.


Jean-Guy Hudon: Madam Speaker, I ask that the remaining questions be allowed to stand.


Madam Deputy Speaker:: Shall the remaining questions stand?


Some hon. members:: Agreed.



GOVERNMENT ORDERS


Hon. Ralph Ferguson (Lambton-Middlesex) moved:: That, in the opinion of this House, the Canadian daily and poultry industries operate under marketing systems that assure Canadians adequate supplies of safe and nutritious food at fair prices while providing efficient producers with fair incomes and, therefore, the government must immediately provide Canadian producers, operating within these supply management sectors, firm assurances that it is seeking and will continue to seek the strengthening and clarification of Article XI of the General Agreement on Tariffs and Trade (GATT) in the ongoing multilateral trade negotiations and that it will not be party to any agreement that fails to achieve these objectives.
He said: Madam Speaker, at the outset of my remarks, I would like to point out that we in the Official Opposition will be sharing our time slots today with the exception of my own introductory remarks which will lay out the basis of this debate. My colleagues will be sharing their time slots and each will be speaking for 10 minutes.
I would also like to ask your assistance, Madam Speaker, in view of the crisis that has developed in the agricultural industry, in finding a way for us to table some petitions put together in good faith by over 5,000 members of various farm organizations at a meeting in Lucknow, Ontario, that are unfortunately in the wrong form. These petitions outline the seriousness of the economic situation in agriculture and were put together in good faith. They do not meet the requirements here. I just received them this morning. I was wondering if there was any way they could be tabled along with the remarks that I am about to make here today.

It is a critical situation out there, Madam Speaker. In my own riding, there have been four suicides within the last month. These people need to be heard, they want the government to realize their problems and to take action accordingly.
I cannot help but think at the onset of this debate that there are strange priorities in this country at the present time. They are strange priorities when it costs $150 a tonne to dispose of Toronto's garbage, yet we only pay the farmers $115 a tonne to produce the food that we eat. I am speaking here of wheat.
This government, as evidenced by its vote on Monday, September 23, does not agree there is a financial crisis in the grain sector in this country. If supply management is destroyed by the government negotiators at GATT, similar devastating prices will occur in the dairy and poultry sectors.
In contrast to the grain sector, the poultry and dairy industries are healthy industries. It would be sheer economic nonsense and madness to see those industries destroyed by the government failing to maintain and strengthen Article XI of the GATT. Let us be clear from the onset, the process of tariffication will utterly destroy these industries. A system of tariffication is not acceptable to the producers of Canada.
For the last 60 years, beginning prior to the Great Depression of the 1930s, there have been actions by various levels of government to bring a level of stability to Canadian agriculture as the Conservative government itself brought in the Canadian Wheat Board legislation in 1935.
In 1949 the Agricultural Products Marketing Act was implemented, and in 1972 the Liberal government of the day proclaimed the National Farm Products Marketing Agencies Act. Of course the Canadian Dairy Commission was proclaimed during that same timeframe.
The National Farm Products Marketing Agencies Act allows for the establishment of marketing agencies with the power to set prices based on the cost of production, to plan production to meet market needs and other measures that would lead to a more efficient industry.
These systems, as they matured, became the most sophisticated of any in the world. In the case of poultry and dairy, the producers achieved a level of stability
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which allowed them a small profit and a return on labour and investment.
Some critics would lead us to believe that marketing boards lead to inefficiencies. When we examine the records of the dairy industries, we find that the productivity per cow in Canada increased by 73.5 per cent since 1971, compared to only 46 per cent in the U.S. and 3.5 per cent in western Europe.
Better feed conversion, better disease control and more eggs per bird have occurred in the poultry industry during the last 15 years under this marketing agency. This is in sharp contrast to the chicken operations in the U.S. where often low levels of antibiotics are fed to combat diseases. Indeed, the chief of the United States Department of Food Safety, Mr. Crawford, recently stated that "the American people are tired of seeing one story after another about dirty chickens" on their markets. Mr. Crawford was commenting on a USDA report that found 35 per cent of the chickens raised in the United States were infected with salmonella bacteria, and other reports according to Reuters News Agency have put the number much higher.
Starting the early 1950s and up to the present time, there has been a growing concentration of control in food after it leaves the processors, a concentration that forced narrower margins for the processors and diminishing returns to the poultry sector.
Since January 1, 1989 to June 1991, 70 food processing plants in Canada were forced out of business, 36 of these were in Ontario.
I recently completed a study which I called "Compare the Share". It shows a huge increase in the price of food over the last 10 years. These increases have occurred after the food has been sold by the farmer and has already left the processor.
In fact, processors are being forced to close their doors not because of high producer prices but because of the untenable situation vis-a-vis distribution, wholesale and retail operations. Anybody who wants a copy of this report can have one by simply writing to my office. I should point out that there will be a brochure available at the Royal Winter Fair giving this outline so that the consumers of Canada know who is ripping them off in their food basket purchases. It is certainly not the Canadian farmers, who are among the most efficient in the world.

October 3, 1991
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This graphic comparison of the cost of various food items clearly indicates that during a 10-year period, from 1980 to 1990, farm gate prices increased very little, in fact in some cases they declined, while retail prices have increased dramatically. For example, a box of corn flakes increased by 94.5 per cent from 1980 to 1989; a box of soda biscuits increased by 235 per cent during the same period; and sweet cookies increased by 135 per cent. And get this; a box of whole wheat cereal increased by 194.2 per cent during this period when the price of wheat to the producer was declining.
By contrast, a product under marketing board control, namely eggs, developed much more acceptable price increases to consumers. Egg prices to the producer increased by 14.1 per cent during this period and by 18.3 per cent to the consumer. Likewise, the farm price of eviscerated weight turkeys to the producer increased by 12.8 per cent and the consumer price by 25.8 per cent. Since 1980 the retail price of chicken has increased by $2.20 per kilogram, while the farm price only increased by 28 cents per kilogram. This retail price increase from 1980 to 1990 was 785 per cent higher than the farm price increase over the same period.
Madam Speaker, that is not acceptable. These price comparisons clearly show the cost of production formula used by the poultry sector has provided a steady level of prices to the producer and a correspondingly fair price to the processor.
It is interesting to note that the total farm value of all chickens, turkey, eggs and milk produced in Canada in 1990 was $4.8 billion, 32 per cent less than the total sales of $7.1 billion of one large grocery chain. The price of a litre of milk in Ontario at the farm gate increased by 19 cents since 1980, on the store shelf the price of that litre of milk has increased by 73 cents, or 97 per cent.
I would like to stress this. The Consumers' Association of Canada in the September-October issue of their magazine blames the fact that milk in Canada costs more than in the United States solely on supply management. However, the Consumers' Association of Canada has not provided us with any research, as far as I can see from
the article, on the price of these products. Madam Speaker, this is pure hogwash. The Consumers' Association of Canada says that it found milk 30 per cent cheaper in the U.S. than in Canada, yet it makes no comment on the fact that the difference in the price of a litre of milk in 1990 between the farm gate and the store shelf is 91 cents, the store shelf price being 160 per cent higher than the farm gate price.
It should be noted that the increase in the retail price of a litre of milk between 1990 and 1989 outstripped the food marketing cost index by 1.5 per cent. It is also interesting to note that neither the Consumers' Association of Canada nor the government consider the increase in input costs versus that of the United States. Input costs for our Canadian producers are approximately 25 per cent higher than those in the United States starting with interest rates, diesel fuel costs and labour. I will say more about that in a few minutes.
I suggest that the Consumers' Association of Canada could do the consumers a better service by investigating the entire food pricing structure, including distribution and wholesale sectors as well as the retailers, rather than singling out supply management for unwarranted abuse.
Why don't they complain about the cost of soft drinks? A small bottle of soft drink costs more than a glass of milk. I respectfully suggest that $793,000 in funding given to the Canadian Consumers' Association last year would be much better spent if it were used to provide food for our food banks in some of our larger cities.
It amazes me that one food chain in western Canada sent $538,700,000 in dividends back to its parent company in the United States last year. Where was the Canadian Consumers' Association when this took place? We didn't hear a word. Obviously we have a double standard in society today. The same is true of cheese. Since 1980 the farm price of cheese increased by $1.53 per kilogram, while the retail price increased by $5.34 a kilogram to $11.52 a kilogram. In 1980 there was a $3.13 spread in price between the farmer and the processor and by 1988 that spread was $6.94.
October 3, 1991

The power exercised by these few buying groups requires a countervailing force in the marketplace. Canada's producer marketing systems provide that counterbalance.
When one examines the chaos existing in the U.S. dairy industry at the present time, the concentration of the U.S. poultry industry and red meat industry, and the impact that concentration will have on Canada as the borders are opened, we on this side of the House realize that it will destroy our marketing systems and our industry. Climatic differences alone give the U.S. a tremendous advantage.
Canadian consumers spend 11.5 per cent of their disposable income on food, the second lowest portion of income spent on food of any nation in the world. The producer desperately needs a fair share of that consumer food dollar.
I should also point out that due to this government's free trade agreement with the United States that marketing boards have again found themselves under attack.
The Conservative government at the time stated that it "defended the right to establish" marketing boards "in the past and will continue to do so in the future" that ice cream and yoghurt is "a GATT issue" and "not a free trade issue". This was a statement by the former Minister of Agriculture in this House on September 13, 1989.
However, a former Canadian trade negotiator at the Tokyo round of the GATT, and in the FTA states: "I have reviewed Mr. Mazankowski's statement and concluded that it is simply not true. The facts are the FTA will result in the elimination of marketing boards whose viability depends on sales to food processors; the FTA caused the ice cream and yoghurt problem; and the government had an opportunity in the FTA negotiations to protect marketing boards and did not".
As these food processors close down, where are our Canadian farmers going to sell their products?
This House passed legislation giving the producers of the nation the right to plan their production and set their own prices under government supervision. This resulted in bringing order out of chaos. Now this government is demolishing these institutions in secret negotiations behind closed doors.
The farmers of Canada do not know what the government negotiators are trading away at the GATT. Cana-
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dian farmers at the end of the negotiations will be told what kind of deal was made. They have no final say in it. They will not even have the right to reject it. This is not acceptable.
In answering a question in the House on October 15, 1990, regarding the GATT negotiations, the Minister for International Trade stated:
Mr. Speaker, on October 1 we had to file at Geneva, together with other countries involved in these negotiations, an estimate of the cost of the various programs in effect in Canada to assist agriculture. The total was $8.8 billion. The Minister of Agriculture should be ashamed of the amount of assistance he is giving Canadian farmers. It is a huge amount of assistance.
However, the Minister for International Trade failed to convince the opposition members and the Canadian public of the legitimacy of these false and misleading figures as opposition members, including myself, made statements in the House outlining the true and correct figures.
I stated in this House on October 18, 1990: "That $8.8 billion is a fictitious figure. It is about 53 per cent higher than the actual figure". For example, papers filed in Geneva on October 1 showed that Canadian dairy farmers received $2.2 billion in subsidies, when in fact, as shown by our own estimates in the House on expenditures, Canadian dairy farmers received only a cash subsidy of $261 million last year, and this goes only to industrial milk producers.
The $2.2 billion is a concocted figure, most of it being the difference between what the U.S. farmers receive for milk versus Canadian farmers and then calling it a subsidy. Again this game of smoke and mirrors ignores the fact that Canadian farm inputs are much higher than those in the United States.
I have to ask, did our negotiators consider U.S. school lunches and food stamps as subsidies. Nearly 50 per cent of the USDA's expenditures go indirectly for social assistance, such as these programs I just mentioned. Were these items included in their costs or subsidies? I doubt it.
Where was the Minister of Agriculture when the Minister for International Trade made that statement last year in this House? Did he inform the Minister for International Trade of the facts? Did the Minister of Agriculture point out that $1 billion of that $4.2 billion was drought assistance? No, he did not.

October 3, 1991
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He did not do it in this House. The Minister of Agriculture was strangely silent. A newspaper editorialist and writers unwittingly used these fictitious figures to attach supply management marketing boards.
Did the Minister of Agriculture write to the editors to point out the true level of support for agriculture in Canada? No. Again he was strangely silent.
I, as a member of this House and as a farmer, had to refute these misleading figures in those various newspapers that cany them. These are strange actions for a man who claims to support Article XI and supply management at the GATT.
If the Government of Canada supports marketing boards, why did the Department of Agriculture give the Canadian Consumers Association a $45,000 grant last year to bring in a study that attacks marketing boards, a study that is partly responsible for these concerted attacks in editorials and other media coverage that occurred, the attack to which the Minister of Agriculture failed to offer a single statement of defence of our marketing board system in Canada?
The study is based on the Minister for International Trade's figure of $8.8 billion of October 15, 1991. I respectfully suggest the Minister of Agriculture took money from the Farm Women for the Survival of Agriculture budget to fund this attack of the Canadian Consumers' Association, which is already getting $793,000 from the Department of Consumer and Corporate Affairs.
The Minister of Agriculture said on September 18: "What we have asked for and what the policy of this government is is that article XI should be further clarified and strengthened. This has not been changed and will not change until the government says it will change".
Does that give you a feeling of security? It certainly does not give it to me because he said that it will not change until the government says it will change.
Last week, my colleague from Gatineau-La Lievre was asking the government if it would assure that the cost of production formula, which is essential to the operation of these marketing agencies commissions, would be maintained. In reply, the Prime Minister
appeared to identify the question as relating to GATT and assured the Canadian dairy industry-these are his own words: "The Canadian government will try to find new markets for them".
I ask you, Madam Speaker, if the government supports article XI which allows countries to limit imports when they have a system of production designed to meet only domestic needs, why are they now concerned about finding new markets for our dairy farmers? The answer is simple.
I do not believe it intends to support article XI of GATT. Why else would the dairy farmers need the government to find them new markets? Did it in fact agree to trade article XI in exchange for the U.S. giving up article XXII which gives the U.S. the waiver it used for years on dairy products, peanuts and sugar?
These people should wake up to reality, because if you look at the cost-input differences and if it gives up that waiver in exchange for Article XI, that puts us in an untenable situation, a no-win situation. The reality is we only have to look at the difference in input costs between Canada and the United States.
In Canada, the interest rates are 25 per cent higher for operating costs in terms of interest rates and 39 per cent for maintenance accounts in interest rates.
Machinery repairs, plough points, are 123.9 per cent higher in Canada; penicillin for animal use, 201.5 per cent higher in Canada; gasoline, 129.6 per cent higher; diesel fuels, 71.4 per cent higher in Canada and farm wages are 48 per cent higher.
How do you compete against those costs. It is impossible. We are going to see this industry, the only sectors of the Canadian agricultural economy that are on stable footing, demolished if we trade away article XI at GATT.
Last Tuesday, the government tabled its new constitutional package and tabled shortly after a document entitled Canadian Federalism and the Economic Union. It is tabled by the Minister of Finance. I have a copy here: Partnership for Prosperity. I quote from page 19 of this document: "For example the range of impediments created by the government includes agriculture supply market boards that regulate production and prices of the various food products, including milk, poultry and eggs."
October 3, 1991

That tells us what is in store for Canadian agriculture in the dairy and poultry industry. The former Minister of Agriculture described marketing boards as trade impediments. Is this how he instructed Canada's GATT negotiators, that marketing boards are trade impediments?
What constitutional change is the government advocating in relation to this and other examples of what it calls internal trade barriers? What is the government doing, creating a constitutional fail-safe way of removing marketing boards from Canada, a way in which the government can have big business do its dirty work by challenging marketing boards on constitutional grounds? Did the government include this provision to appease the rank and file of the Progressive Conservative Party who at a policy meeting in Toronto this past summer defeated a resolution supporting supply management? Has the government examined the U.S. dairy industry that is in total chaos, an industry in which 40 per cent of the producers cannot pay their bills?
Has the government examined the concentration of the poultry industry in the United States where one company controls 14 million laying hens, twice the number that we have in all of Ontario, and where one of their largest chicken producing companies, totally integrated, controls one-third of the chicken production in all of the United States? How do we expect our Canadian farmers to compete against that sort of thing when input costs are so much lower?
The government should strengthen Article XI at GATT and ensure that it includes a provision to block imports from countries which are not practising sustainable agriculture. To block food imports from countries which are creating unfair competition with Canadian farmers by using chemicals and pesticides which are illegal for use in Canada is clearly needed desperately in this country.
In conclusion, I call on the government to support the poultry and dairy sector in this country; to stop using misleading figures relating to Canada's dairy and poultry producers; to support and strengthen Article XI, as it promised; to reply to those editorial attacks; to stop using
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blatantly false and misleading figures that cast a cloud over our dairy industry; to insist that the United States stop its export enhancement subsidies which are in clear violation of the free trade agreement; and above all, stop trying to drive a wedge between the Canadian consumer and the dairy and poultry farmers of this country.
I am appalled that one year ago this month the Minister for International Trade not only tried to mislead this House, but obviously mislead some of the news media of this country and the people of Canada. I call on the minister here today to speak up and clear this record; to admit the $2.2 billion support for Canadian dairy farmers, as stated by the former Minister for International Trade about one year ago, is a concocted figure. I call upon him to apologize to the dairy farmers of this nation because the actual figure of those subsidies was $267 million.


Mr. Len Gustafson (Parliamentary Secretary to Prime Minister):: Madam Speaker, I have just a short comment. The hon. member speaks with great platitudes about what his administration would do. On the farm there is a saying that is common among the farmers when they go to hire a man. They say: "Don't tell me what you're going to do, tell me what you've done".
I think that it would do well for the Canadian people to observe very carefully what the administration has done. We remember when the Trudeau Liberal government said: "Sell the wheat". We remember when the Liberal administration dealing with farmers, whether it was the chicken industry, the feather industry or the dairy industry could not get one seat west of Winnipeg to represent them. They had to send senators out there to represent them. That is how serious it was.
We saw a very good example of that in this House just yesterday in terms of the votes that took place in this House. Where did the Liberals and the NDP stand? They stood with the labour unions. Forty boats in the ports, 10 more boats coming in to load grain and they voted against with the labour unions.
On the positive side, what the Conservative government has done is we have stood at the GATT. We have stood there for the dairy producers and we will stand there. We have stood there for the feather industry and we will stand there.

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The Prime Minister was the first Prime Minister of Canada to ever address the Federation of Agriculture, which he has done three times. Check the record. I was at the meeting in Vancouver when he called 50 farm groups together.


An hon. member:: What is he going to do?


Leonard J. Gustafson: Watch us. What I am saying is look at our record. Look at our record and judge us on our record. If there is a government that has stood with the farmers and will stand with them, it will be this government. We have had a history of doing this.
In Saskatchewan today they are going into an election. It is either going to be the labour unions under Roy Romanow or a man like Grant Devine who stood with the farmers, not always right on all issues, but always standing with the people they represent. We are the group of farmers. We are the members who represent the farmers and we will stand with them.


Ralph Ferguson: Madam Speaker, the hon. member asks whether we know where the government stood. I want to point out to him that under article 701.4 of the free trade agreement, the United States must take into account the effects of its export subsidies on other nations, how they affect Canada, and must ensure that they do not prejudice our exports.
Under article 1804, provisions are there for the government to call for consultations if such incidents take place and to ask for compensation. They did not do that.
I raised this in the House on March 18, and I would ask everyone to look at the response I got to that request by the prairie pools and by the farmers in western Canada. In terms of a former Prime Minister saying "why should I sell your wheat", I should point out to my colleague across the way and to everyone what the total statement was. He said: "Why should I sell your wheat? I could not sell it if I wanted to. You already have two government organizations doing it for you". Please use the full statement in total context the next time.


An hon. member:: That was a bit rough.


Mr. Maurice Foster (Algoma):: Madam Speaker, I was very impressed by the attempt to defend the government record by the hon. Parliamentary Secretary to the Prime Minister. It was only three or four weeks ago when grain and oilseed producers from across this land met and they are still waiting for government support.
Last year the government slashed support programs by $1.3 billion at a time when the price of grains and
oilseeds in the world market was dropping by 30 per cent, from $135 a tonne to $95 a tonne. This member and his Tory colleagues voted unanimously with our caucus in an agriculture committee meeting to call on the government to provide emergency transitional assistance, as was asked for by the farm organizations right across the country. That is why we are having meetings all across the country today. There were 3,000 to 4,000 people meeting in Rosetown this week, 1,500 in Brandon and over 1,000 in Lucknow, Ontario, because the government welshed on that commitment. It made a commitment last winter to provide that assistance and it did not live up to it. It supported a unanimous resolution in the agriculture committee and two weeks later, here in the House when the motion was put, it voted against the same motion.
That is why we are concerned about what is going on at GATT today because we know that you have double-crossed us in the free trade deal with the United States and we are scared that you are going to destroy this entire industry in those negotiations this fall. If you do, you are not just destroying 30,000 or 40,000 farms; you are destroying rural Canada and that is unacceptable to Canadians.


Madam Deputy Speaker:: Before I give the floor back to the hon. member for Lambton-Middlesex, let me say that it is very early in the day and it would be appreciated if hon. members who have the floor would address their remarks through the Chair. It might make things a lot easier later in the day.


Ralph Ferguson: Madam Speaker, I totally concur with what my colleague has said. There are veiy few farmers in this House of Commons who worked their lives to put together a family farm operation. It distresses me to see the despair and hardship out there across this country. I see my own son experiencing it.
I have to wonder, when I look at the graphic illustration of this book, why this government has not been going after the concentration of power in the food distribution sector, the wholesaling and retail sectors. Where was the Competition Bureau when all this was going on? It is unacceptable that the farmers of this nation should not have an income and the level of security that is available to the rest of society. We need an income that is commensurate with the rest of society. I for one am not going to stand here in this House and say nothing while the GATT article XI may well be neutered or done away with.
October 3, 1991


Mr. Schneider:: Madam Speaker, I hesitate to rise on a point of order. I admire the hon. member and the presentation he gave but he did make several comments relating to the Minister of Agriculture misleading Parliament. Maybe he would like to have an opportunity to rethink those statements.


Madam Deputy Speaker:: I listened carefully to what the hon. member was saying and I do not think he said that the minister deliberately mislead either the House or anyone, which is why I did not stop the hon. member on that.
I think it would be wise for all of us to be a little more careful with our words. As I said a minute ago, it is going to be a long day. It is a very strong debate. I think we can debate without using words that could be construed as insults to one another or to any other people.


Mr. Ross Belsher (Parliamentary Secretary to Minister of Fisheries and Oceans and Minister for the Atlantic Canada Opportunities Agency):: Madam Speaker, I have a short question for the hon. member.


Madam Deputy Speaker:: There is one minute left. It has to be a very short question.


Ross Belsher: How does the hon. member opposite reply to the statement when our negotiators in Brussels say "we are continuing to operate under the instructions we took into the earlier talks in Brussels and those instructions reflected a negotiating principle, a position that was worked out with all of the segments of the industry"?
Those are their instructions. Those are what they are working under. Yet the member opposite and his cohorts continually say that we are dealing away article XI. The member knows full well the negotiating position of Canada and that position has not changed.
What does he tell his farmer friends about that?


Ralph Ferguson: Madam Speaker, the Minister of Agriculture said that that was their position, as you laid out, and it will not change until the government says it will change. Why did he not say that the government never intended to change it and will not change it? He did not say that.
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I would also like to point out the words of the Prime Minister a few days later when he said that the government would try to help Quebec producers find alternative markets. That again throws a whole question mark over these whole proceedings.
Certainly I am worried about it. I am sure that farmers here today in the gallery are equally worried. These are facts that are contained in the Hansard of this House.


Mr. Murray Cardiff (Parliamentary Secretary to Minister of Agriculture):: Madam Speaker, I am veiy pleased to be able to rise today and speak on this very important motion.
Before I start into my remarks pertaining to that motion, I would like to make a comment or two. The Lucknow meeting has been referred to many times by my colleague from Middlesex and my other colleague from the northern part of Ontario. Lucknow, Ontario is in my riding. I have to say that at that meeting the farmers were there out of sheer concern. It crossed all political boundaries. I do not believe it was a partisan meeting in any way. They conducted themselves with great, earnest sincerity and I compliment them. I am very proud of the people who were at that meeting that night.
Since that time there have been many meetings held across the country. That was one of the first meetings held. We do recognize the seriousness of the problem. It was well recognized before those meetings, but when we see people gather in a non-partisan way to bring their concerns to all levels of government and all politicians we know how sincere they are.
As you have indicated before, Madam Speaker, it is early in the day. I guess I am the second speaker. I would hope that we are hon. members, ladies and gentlemen in this House of Commons, and that we can conduct ourselves with that same sincerity and feeling that was at that meeting in Lucknow that night. We must drop some of our partisanship feelings and try to reassure the farmers of Canada that we as politicians are working with them. We will do everything we can to support their positions at the GATT talks or in any sector of agriculture, internal, external, international trade, the Uruguay round or whatever it might be.

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I ask members of the House of Commons to give this the serious consideration that is necessary for the debate that will take place today. It is early in the day and I think that we can be helpful to one another and give the reassurances that are necessary. I do not think it is the time for political muck raking of any political party, no matter which side of the House it might be on.
I would ask my colleagues on this side of the House to do their part as well in keeping the debate on the high road, for those very reasons.


An hon. member:: We always do that.


Murray Cardiff: I would hope that continues for the day.
As I said before, the motion before the House today asks that the government provide assurances to Canadian producers operating under supply management systems that will seek to strengthen and clarify article XI of the General Agreement on Tariffs and Trade in the current round of multilateral trade negotiations.
Let me assure hon. members that this government stands solidly behind the supply and management industries and is fighting hard to protect the interests of all Canadian agricultural producers. We could expand on that slightly or as much as we wish and have a debate as well on those two particular industries and what we have initiated in the past few years. In about the last three years the two task forces have brought the poultry industries together, the dairy industries together, all sectors, all the stakeholders in both of those two very important industries to Canada.
I believe by bringing all those stakeholders together we will have a much more solid position, a greater understanding by all the stakeholders, including the consumer who is one of the major stakeholders. I believe they have to have input and we have to understand what their concerns and needs are as well.
Our commitment to the supply management sector is strong, as I said before. We stated our position clearly last year at the multilateral trade negotiations in Geneva. Canada's offer for agricultural trade reform has not changed. It has not changed.
Canada's offer calls for greater security for supply management through a strengthened and clarified article XI at GATT.
My colleague, the Minister of State for Agriculture, met with Canada's poultry and egg marketing agencies
just last week. He reaffirmed the government's position in the GATT negotiations on agriculture. I will just quote what he said: "We are firmly committed to negotiate an agreement which protects our supply management programs and as such we will do everything in our power to obtain a clarified and strengthened GATT article XI".
As recently as yesterday our caucus met with a number of the supply management groups from various parts, mostly Ontario. I hope our colleagues had an opportunity to meet with those people as well and discuss this very important subject.
There can be no doubt of the government's position regarding international trade reform. We have identified the problem and are moving aggressively to secure a successful resolution. In fact, my two colleagues in the agriculture portfolio, the Minister of Agriculture and the Minister of State for Agriculture, have both been in New York this week representing our farmers' interests.
The Minister of Agriculture met Wednesday with the European community's Commissioner for Agriculture and Rural Development and impressed upon Mr. McSharry Canada's resolve to have the talks ended and brought to a successful conclusion this year.
I was in Madrid last week at international meetings of ministers of agriculture and there were times last week when we had as many as 35 ministers of agriculture at the table taking part in the agriculture issues of the world. All have a desire to see a successful conclusion to this Uruguay round of talks.
In a statement following the meeting, my colleague was quite direct in voicing our position, and I quote: "Canada wants to see an end to the international subsidy war in fruit market access and the development of clear and fair GATT rules that apply to all countries, including the strenghthening and clarification of article XI".
This week the Minister of State for Agriculture is participating in several meetings concerning the GATT negotiations in Europe. His itinerary includes meetings in Geneva with the Director General of GATT. In all meetings my colleagues will stress the importance to Canada of international trade reform. He will stress the need to protect Canada's supply management sector and will detail the devastating effects these subsidy wars have had on Canadian agriculture. I do not think anyone will disagree with what the subsidy wars have done to our economy.
October 3, 1991

My colleagues who will speak today will talk in more detail about our position on supply management. I also want to take the opportunity to talk about the world trading environment and how it is affecting our farmers.
The international grain export subsidy war has devastated grain prices. Canadian Wheat Board initial payments, which are set in relation to current world markets, are at their lowest level in 15 years. The subsidy wars attacked without mercy an industry which is essential to our Canadian economy.
Canadian farmers are recognized as among the most efficient producers in the world. I do not think it matters what commodity they are producing. They are efficient. They have concern for high quality and I believe the consumers of Canada rest assured when they buy Canadian products that they have the highest quality product, nutritious and wholesome. That is what they expect and that is what they get.
We have done it without using massive subsidies or massive amounts of agricultural chemicals. In a fair trading environment Canada's grains and oilseeds industry would be healthy and competitive. There is nothing fair about what is going on.
This year the Europeans are expected to spend about $4.7 billion Canadian on export subsidies, about twice as much as five years ago. European export subsidies are the highest of any country on wheat and growing fast. Its export subsidies per tonne on wheat have more than quadrupled from $44 a tonne Canadian in July 1989 to $190 Canadian a tonne in February 1991. Already this crop year the European's feed export subsidies are higher than $120 a tonne.
The U.S. is expected to spend about $1.4 billion Canadian on its export enhancement program this year, and that is $1.4 billion more than it was seven years ago. In 1991 total EEC agriculture expenditures were about $42.5 billion Canadian. That is more than Canada's entire $30 billion deficit.
Recently the EEC sold wheat to China at about $85 Canadian a tonne, using subsidies approaching $200 Canadian. A recent wheat sale carried an export enhancement program subsidy of $70 Canadian a tonne. Selling prices have been as low as $75 Canadian a tonne.
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A recent United States barley sale to Saudi Arabia carried subsidies of $47 a tonne, with a selling price of $88 a tonne.
These kinds of subsidy levels have pushed grain prices to Canadian farmers to drastically low levels. The agriculture policies of the European Community and the United States have been a brutal assault on Canadian grains and oilseeds producers. Their policies have attacked individual farmers in countries like Canada, Australia and Argentina which depend on the export market.
The export subsidy is also harming the environment. In order to increase yields, a producer in the United Kingdom uses on average three times more nitrogen fertilizer than a farmer on the Canadian prairies. In the Netherlands the rate of nitrogen fertilizer application is 30 times the rate in Canada.
It is time to put pressure on. European environmentalists have succeeded in demonstrating a way of life for our natives, the fur industry and our seal industry. Why are they not concerned about the environment in their own backyard?
The subsidy war is a crime against the developing world. Developing countries trying to compete with similar products are also hurt by low grain prices, and because agriculture is such a large part of a developing country's economy this hurts their entire population.
I was in Madrid last week at international conferences of IICA and IABA. Latin American and Caribbean countries were represented, and we certainly know that they have problems we do not have. We have very severe problems in our agricultural industry but they certainly have more problems. I am very concerned that if we do not get some resolve from the Uruguay round of talks we will see countries go into isolation to protect themselves and try to protect their own market, while they know that they have to have export for the development of their country. Many times in those poorer countries in Latin America and the Caribbean it is the women and the children who are suffering the most in those circumstances. I believe that the various nations of the world have to work together to bring a resolve to this devastating grain war.

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One of the best ways to generate wealth internationally is through trade. We know that. The EEC's policies shut borders, restrict competition and deny opportunity. It is hypocritical for the EEC to encourage the new democracies of eastern Europe to develop a market oriented agricultural industry, while at the same time restricting access to the EEC markets.
There has to be an end to the export subsidy war and the solution lies in the GATT. The next few months are critical. There is no question about that. That is why we have to work together and take a solid position.
The options paper put on the table by European Agriculture Commissioner, Mr. McSharry, shows a willingness to start the reform process but it must move further. At least what he is proposing is a start.
This government has a major commitment of resources supporting Canada's negotiating strategy in the Uruguay round. The EEC and the United States have to know what we want, an end to this madness.
My two colleagues are in Europe this week delivering the message, and we will continue to bring our message to the capitals in Europe. We are prepared to take retaliatory action against the EEC as the Minister of Agriculture pointed out to Mr. McShany just yesterday. He is the agricultural commissioner for the European community. I quote what was said yesterday: "I did not put it forward as a threat. I put it forward as a fact". We will make sure the farmers of these countries hear our concerns too.
I can assure members of this House that this government remains 100 per cent behind its negotiating position at the GATT on behalf of the farmers of Canada. Once again, I ask all colleagues of the House of Commons to work together. Let us keep our position solid. We believe that the position we have taken is fair and balanced and we have not changed that position.
I believe there is support in other parts of the world for the position we are taking. I know that our farmers, producers and consumers are all depending on us getting a resolve to this Uruguay round. I hope that we do have that resolve early in the next year.


Maurice Brydon Foster: Madam Speaker, I was glad to hear the parliamentary secretary's comments today.
The parliamentary secretary has told some of our colleagues here in the House that at the inter-American meeting of ministers of agriculture on September 25, the matter of article XI was not even raised. I wonder if the parliamentary secretary could explain why he did not raise the matter, why he did not try to get the support of those several dozen ministers of agriculture to support our position on article XI.
After all, we do not dump massive amounts of dairy or poultry products on the international market. We control our production so that we are not massively interfering in the international trade. I wonder why the parliamentary secretary, who speaks for the government, did not raise the matter at those meetings.
I also would like to ask him if he agrees with the resolution before the House today, that this House supports the strengthening and clarification of article XI in the multilateral trade negotiations which are going on in Geneva and that it will not be party to any agreement that fails to achieve those objectives.


Murray Cardiff: Madam Speaker, to my colleague from Algoma, article XI was raised in many bilateral meetings last week with ministers of agriculture in a different format. At all levels of meetings the Uruguay round of GATT talks was very much up front.
When you talk about reform to agricultural policies, we thought that reform meant all aspects of agriculture and that does include article XI of GATT. That is our position.
Our position is well known among all of those countries of the world and not ail Latin American-Caribbean countries are at the table at the GATT talks. Last week's meetings were a great opportunity for them to put their positions forward and the problems that they are suffering because of this international war.
Also in respect to the motion, as I said before, our position has not changed. We are solidly behind article XI. We have asked for it to be strengthened and clarified, and that is what we intend to have happen in respect to article XI.
October 3, 1991


Victor Fredrich (Vic) Althouse: Madam Speaker, in his remarks the Parliamentary Secretary to the Minister of Agriculture spent some time discussing the world wheat, grains and oilseed trade.
He said something like this, at least this is how I got it as a quote: "In a subsidy-free world Canadian grain and oilseed producers would be healthy and competitive".
Agriculture Canada, through a study by Whorley from the University of Guelph and I think McClatchy from the department looking at what a subsidy-free world would do to international grain prices, did not come up with a terribly optimistic view of what we could expect. I think it was something in the order of 5 per cent or 6 per cent of an increase from current prices.
A couple of economists from the United Kingdom have just completed a study concluding that the most we could expect would be a rise of up to 12 per cent.
Given that the world price is around $2 a bushel Canadian, does he honestly think that Canadian producers will be healthy and competitive at $2.24 or $2.25 a bushel for wheat? This makes no sense and it does not compute with any economic reality. Where does the minister get his dreams?


Murray Cardiff: Madam Speaker, I think we all dream at times but this is not a dream. I am a farmer as well and I certainly know-and I think everyone in this House knows it whether they are farmers or not-that a bushel of wheat weighs 60 pounds and at $2.241 have never seen such a bargain in my lifetime. It is not fair. A farmer cannot survive at $2.24 or $3.00 bushel. We have to be very honest and frank about that.
What we all love to see is the export subsidies discontinued in particular by the two major countries, the United States and the EEC. We believe that if the treasuries were withdrawn from those countries-


Victor Fredrich (Vic) Althouse: The Economist assumed that.


Murray Cardiff: I am not talking about The Economist. I am talking about my position. I do not believe there is a huge supply of world grains in the world.
I have not interrupted anyone in this comment at all. I believe and it makes common sense that there is no use of trying to find new markets and lowering the price
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every day you find a new market. Why grow more wheat to sell it for less?
Let us try to work together. Let us get paid for the crops we are growing, whether it be wheat, corn, barley, soyabeans or whatever. We know that there is a market in the world, but let us get some common sense brought back to it.
We can do all the studies we wish and predictions we make, but it takes some reality before anything will happen. I believe the first step is to get some common trade rules that grain producing nations in the world agree to and abide by.
It is not going to be a quick fix. Any of us who have farmed any length of time have lost crops. We have lost major crops and have not been able to produce much more than our domestic requirements. We know that in Canada we do produce for an export market. We have all forgotten the fact that we might lose a crop some year. We could lose a crop in all of Canada. It might not just be eastern Canada or western Canada, but those things have happened before.
I am a positive person. I do not believe in gloom and doom, but we have to face reality and we have all witnessed crop failures throughout the world. None of that has been taken into account by any economist study that I am aware of. There are other elements that often take place that will change those things.


Mr. Dennis Mills (Broadview-Greenwood):: Madam Speaker, thank you very much for giving me the opportunity to ask a question through you of the member for Huron-Bruce.
There are many of us from urban ridings who are not as up to speed as those members from rural ridings. I have a great respect for the member for Huron-Bruce who has worked hard for his constituency. I have been with him travelling the world where he has represented all of Canada.
During his speech today he talked about the unfair environmental practices that are going on in the European countries. It would seem to me that it would be a useful exercise if the European community at large understood that its farming communities were doing this unfair environmental farming practice that the member talked about during his speech.

October 3, 1991
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My question to him is quite specific. Has his government, he, his colleagues or the Minister of Agriculture ever considered communicating to European countries at large, whether through newspaper, radio or television, in order to attract more popular European support as to what is happening to the Canadian farmer here, this unfair trading practice advantage? In other words, let us take a page out of the book of Greenpeace when it tried to upset our seal practice in the Arctic. I would like to know what the member's view is on this particular approach.


Murray Cardiff: Madam Speaker, I have not been privy to any discussion about advertising ads, but maybe that is a good way of making sure our colleagues in other countries are fully aware of what our position is and the devastating effect it is having on our agriculture.
It is a good point and one worth taking note of. I thank the member for that. I am sure that the producers in that part of the world are as concerned and as aware of their future environmentally as we are in this country or in any other part of the world.
It is my understanding that laws are being passed by the European communities that by the year 2000 considerable reduction by almost 50 per cent in the use of pesticides and chemicals has to take place. That normal reduction of pesticides and chemicals will ultimately result in lower production.
We have concentrated livestock operations in some of those smaller countries, extremely concentrated. Before you can spread the waste from those huge animal locations, pigs or dairy or whatever, you have to have a permit. You have to test the soil and you have to have a permit before you can spread that waste on that soil.
A friend of mine visited Holland earlier this year. He got permission one day to spread that liquid waste. They went away to visit and go on a tour. Another farmer knew it was okay to spread in that field, so he spread his liquid waste on the field while my friend was gone. That is the situation some European farmers are facing.
I do not want to leave the impression that European farmers are having it easy. They have their difficulties as well and are going to have to respond to environmental concerns as much as we are or maybe more.


Victor Fredrich (Vic) Althouse: Madam Speaker, I rise to participate in this debate today which gravitates around the Canadian position in the GATT with regard to the supply managed industries and the question of whether article XI 2(c)(1) becomes strengthened in the new GATT negotiations.
I think the question of marketing boards and supply management is not fully understood even in Canada. We have a reality that exists in the production and distribution of agricultural products that has to a certain extent been recognized by producers in their decisions to establish marketing boards and the type of marketing board that will be put into place.
As a general rule, you will recognize that there are perishable products in agriculture which generally can be stored for a few days or a few weeks, certainly not more than a year, and there are other agricultural products that are almost non-perishable, like most of the grains and oilseeds that can be dried and stored almost indefinitely. Some kinds of wheat have been found in Egyptian tombs that were 5,000 and 6,000 years old and still would germinate.
The strategy that has been pursued by farmers and governments over the years has been somewhat different for each type of product. Marketing boards were established during the 1930s, based upon practices that were utilized and developed in New Zealand and Australia. The first marketing board was established to permit producers to co-operate and sell all of their products through a single seller, single desk selling as it is now referred to. This method is used by the Canadian Wheat Board. A whole host of products utilize the single desk selling technique at the provincial and national level.
An additional wrinkle occurred when marketing boards began to see that there were some problems in some of the more perishable products if there was no power to control supply. The first supply management board was established under the Canadian Dairy Commission by a special act of Parliament which gave the Canadian Dairy Commission the power to restrict the amount of production of dairy products to the amount that would be consumed in a year in Canada.
October 3, 1991

They have not been strictly hide bound about this. They have always permitted a little bit of product to come in from outside. This is to keep the wheels of world trade going, and the system has worked.
Using that as a basis, some of the so-called feather-boards were established on a national basis. They got the power from this Parliament to establish national agencies which could control supply. The Canadian Egg Marketing Agency was established as well as the Canadian Chicken Marketing Agency, the Canadian Turkey Marketing Agency and the Canadian Hatching Egg Agency.
This Parliament also granted power to tobacco people to form such an agency, but that has not come about. I would prefer that Parliament make the establishment of these kind of agencies an automatic thing at the behest of the producers so that the law itself was wide open because awaiting approval from this House often kills an initiative. That is what happened with the tobacco initiative a few years ago.
At any rate, we have established this system that works in this country. We permit imports under licence. Imports are controlled by the Government of Canada in all cases. For a while the Canadian Wheat Board could control imports but that is slipping away now that we have had the Canada-U.S. trade agreement.
Under the board system we are much more liberal in our trading policies than our neighbour to the south, the United States. It does not permit any imports of dairy products. It does not permit any imports of sugar products. It does not permit any imports of peanuts.
It has a GATT waiver which it negotiated a long time ago in the early stages of GATT, and it will not give up those rights except under certain conditions. I think there were a few tiny little cracks opened up for some baked goods as a result of the Canada-U.S. trade agreement.
It controls those products very thoroughly. As an example to show how ridiculous it has become, the U.S. moved under GATT to get access to the Canadian market for U.S. ice creams and yoghurts. We resisted that as is our right under the GATT, but had we acceded we would have been in the ridiculous situation of permitting U.S. yoghurts and ice creams to come into the country.
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If I or one of my neighbours wanted to take a trip into the United States for a tour of one of its parks and perhaps wanted to take a trailer or a motor home with us and happened to have in the refrigerator U.S. made yoghurt or ice cream and were inspected at the border, we would not be permitted to take those into the United States even though they were made there. That is the way the rules are at the moment.
The question of article XI 2(c)(i) has become a cause celebre among those producers of products that are produced in Canada under supply management. It is a very large proportion of the production in some of the provinces, particularly in Atlantic Canada, Quebec and in parts of Ontario.
Also, it is very important in British Columbia and the prairies. A big chunk of our industry is being bargained with at the GATT table. These producers are feeling very uncertain about what the negotiators are doing to them in Brussels or Geneva.
They are getting conflicting signals from this government and from some of the people who are supposed to be engaged in the negotiations. We are being told, as we were by the parliamentary secretary today, that the government stands four square behind a strengthened article XI 2(c)(i).
On the other hand, we listen to the hon. Minister of State for Grains and Oilseeds who has been on a violent anti-European rage for the last six months. He has been addressing farm meetings telling them "Don't buy European. If you are unhappy with the way agricultural policy is going, dump your wheat on the parking lot of a European auto dealer or a dealer of farm implements that has European content. Don't come to me. Blame it on the Europeans. Boycott the Europeans. Don't buy any of their goods".
The reality is that prior to this rant by the Minister of State for Grains and Oilseeds we were depending upon the European community and the Nordic group to be our allies in pushing the strengthened article XI at the GATT. We did not have very many other allies strong enough actually to make certain that we would get a strengthened article XI. They read the newspapers. They have embassies in our country. They know what the Minister of State for Grains and Oilseeds is telling people across the country. They begin to think that maybe this is the policy of the Canadian government.

October 3, 1991
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We get rumours back from the GATT negotiators that Canada is beginning to be pushed into a situation where the only real ally it has for article XI is Japan. We should realize that the Japanese are very passive negotiators in these sorts of things. They do not stand up and take strong positions. They simply stand there knowing that they have a very strong fortress, Japan. They have a very strong economy. They are very strong traders, and they do not think they are going to have to give up anything. If article XI is not strengthened, they are big enough players on the world stage that they can go on internally getting the same results for their producers as a stronger article XI would have produced, and the rest of the world can just go by or lump it.
It is not a very strong position that we are left in, thanks to the duality that we have seen portrayed by members on the government side.
I confess to Europeans and to Americans that our position perhaps seems a little schizophrenic. When it comes to grain trade on non-perishable products we are right in there saying that we want open borders, we want access, and we do not want international subsidies used and export subsidies used. When we are looking at perishable products, Canadians have always taken the position that we should produce enough to provide for our own market.
Some of the Americans are telling us that this is a two-tongued or a forked-tongue approach and it is a schizophrenic approach. Perhaps it is but it is also extremely rational when you think about what food production is all about. It is absolutely necessary to be able to produce those perishable goods that you need when you live in a country like Canada. We are not in the middle of all of the world's trading routes. We are a huge peninsula, I suppose, on the northern end of the Americas. We only have one country that we can trade with easily, and that is the United States. We are a northern community, isolated by long distances by three oceans, one of which is barely passable most of the time. We are isolated.
Our companions at the bargaining table at the GATT do not have that problem. The big powers have other choices.
The United States of America can trade to the south. It can trade to the north. It has a choice. It has a multitude of choices. We have only one choice.
The Europeans are sitting in a position where they can trade with the Nordic group, they can trade with the east bloc and the Soviet Union. They can trade with the African countries. They have lots of choices. They are all right on their doorstep and are all consumers who are well-educated consumers and they know the products that they have. They do not have to introduce the products and sell them, because they have a commonality of interests and the commonality of demands.
The Europeans are not terribly interested in getting a GATT result because their economy will go on very well, thank you very much, whether there is a GATT solution or there is not a GATT solution.
The Japanese are in a very similar position in their niche in southeast Asia, a huge market which they know how to penetrate and they have been penetrating for most of this century, actually.
Canada has been trading a little bit with everybody. We are a very large trader. We are dependent on world trade, so our seat at the table is extremely important in the GATT talks. But when we come to resolving the agricultural issues, we are not making it terribly clear or accepting the reality of why countries have agriculture in the first place.
I think we should be going to those talks, recognizing the reality that countries' first imperative is to tiy to feed themselves and to accept that that is a legitimate kind of trading and economic proposal. It is an economic proposition that has to be accepted. That would permit the production of perishable products within your own country, close to the demand that exists within your own country. That is what Canada had traditionally been saying. Even the United States has been acting on that, though it is not saying that in this round. The Europeans have definitely been acting upon that, as have the Japanese, who have become self-sufficient in the production of rice, even though they have a very small acreage. That is their key food input and they are self-sufficient in rice. They could, if they had to, live on rice and the results of their harvesting of the seed.

It is a natural thing for human beings in nation states to want to be able to feed themselves. The proposals that the United States has put on the table, and which has now become the dominant theme at the GATT, does not pay any attention to that reality.
Canada has, as often as not, taken the position of the United States, with the exception of Article XI and because the article XI argument has been shifted, or is in dire consequence of being shifted aside due to the reasons I outlined before, namely, that we have made ourselves less popular with the Europeans who should have been our allies and the Nordic group, we are now being isolated along with the Japanese and in consequence are probably going to lose it unless we very strongly start changing our public position.
The hon. Parliamentary Secretary to the Prime Minister pointed out that he thought that people made their decisions about whom to hire and in whom to put their trust by asking the question: "Don't tell us what you can do, tell us what you have done." I think that is what is beginning to be reflected in the rallies that we are seeing in Miami, Manitoba, Brandon, Manitoba, Lucknow, Ontario and most recently in Rosetown, Saskatchewan.
They are starting to say: "We have had these guys for seven years. They have not listened to what we have been asking; they have not done what we have asked; we are rallying to point out that the government has not reacted to the actual situation". The reality for people on the land is that world prices and their incomes have never been lower in purchasing power. In the history of this country since statistics were kept, the price of a bushel of wheat has never been lower in terms of real buying power.
Those commodities that are traded because they are considered non-perishable on a world market have never traded lower. The solutions that this government is offering is do away with all of the subsidies, do away with the export subsidies, do away with the internal subsidies and to rely solely on a world price.
Those were the assumptions that the two economic studies, that I referred to in my question earlier, used when they analysed what would be the result of going to that kind of a world. They looked at the kind of world supply-demand structure that most of the world experts foresee. They concluded that there would be very little increase in price at the farm level, that that increase could be expected to be up to 12 per cent.
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Farmers who are selling their grain this year, with wheat at $2, are not encouraged to know that they can look forward to the great day when we get to the dream of this government when they can get $2.25. Their costs are more than double that. They do not see this as the great saviour and they no longer see this government and its party as the great saviour. They no longer see the Conservative Party as the party that shares their dream for the future of agriculture and the future of their rural communities. They no longer support the government's policies and they are beginning to tell it so. They are giving it a chance to correct its ways and mend its ways, but there is not very much time.
The GATT positions will be laid down clearly. We will find out within two months whether Canada is going to join the United States and bring the Europeans along into tariffication of all of the border measures that are now in effect under article XI or whether they will in fact stand up and try to find some allies and correct the mistakes of the past six months and get us a stronger article XI(2)(c)(l) as has been proposed by the people who are producing in Canada under the supply management system.


Larry Schneider: Madam Speaker, I listened intently to the hon. member and was inspired to rise to my feet in particular reference to a statement that he made dealing with some of the statements that are being made by farmers at some of these major farm gatherings, sometimes referred to as protests.
As one who had the pleasure of being in the company of all Conservative members of Parliament from Saskatchewan at the Rosetown so-called protest, what I sensed that I heard was a protest against the price of grain. While yes admittedly there was the odd comment cast toward government, the majority of the comments were from a completely rational, fair and honest crowd who recognized that the problem was not this government inspired, but it was perhaps inspired by other governments, not the least of which was the European Economic Community and the United States.
I think you have heard over the past many members of the House of Commons in staunch criticism of the export enhancement procedures employed by both the European Economic Community and as well the United States.

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I wanted to rise just to point out that there is another side to what one is capable of hearing at these events and to place on the record the fact that farmers, while despondent almost to the point of desperation realize where the problem is. They realize there will have to be some changes in agriculture in the future as well.
These changes include, as it has included everything in our lives, everything in the way in which we currently farm. Gone is the day when a producer can simply reply on a product that that particular farm has grown for 50 to 60 years. We find diversification becoming more and more the method of operation for farmers. However, we realize there are limitations in that regard as well. In reading about some of the problems that the European Economic Community is going through, 150,000 French farmers demonstrated, protested, saying: "Leave well enough alone. We rely on these export enchancements". That is the problem of the European Economic Community. Our problem, as we see it now, is one that we recognize, where the cash flow going to farmers, which in turn goes to support the small business sector, is one that we have to rely on.
I simply want to ask the hon. member, is my recall of events that occurred in Rosetown any different than what he heard?


Victor Fredrich (Vic) Althouse: Madam Speaker, yes, perhaps we do have selected hearing. I did not hear anyone in that crowd at Rosetown say that they were awaiting changes in agriculture, that they were unable to make changes or refusing to make changes. Farmers are very quick to adapt new techniques and to make changes in products.
I will go back to my notes to make certain this is right. I heard one person who stood up, and it was reiterated by several others, say: "The purpose of this meeting is not to damn the Europeans. What we would like is a similar commitment from our government".
Another person stood up and said: "We have been hearing a lot of talk about the problems that the Europeans are creating for us in world grain and oilseed trade. But let us not forget"-and they were reasonable people, I remind the hon. member-"the Europeans, after all,'only sell into about 20 per cent of the world market. Between Canada and the U.S., we control almost two thirds of the market". If we wanted to do something about a price, all it would take is the political
will to get together with them and offer products at a higher price, or stay off the market for the first month and a half until the Europeans have run out and then run the price up.
We have not had this kind of initiative. What we have had instead is a deliberate policy from south of the border, agreed to here, that the U.S. loan rate will continually go down and effectively becomes the world market price, because any grain trader can go to the U.S. Department of Agriculture and get his supplies, knowing it will be available at that loan rate.
That has overhung the market for the last six years since the new program went into effect. It was an intent expressed quite clearly by a former Secretary of Agriculture on the part of the United States to dominate the world grain trade and to engage in international warfare and use, in his words, food as a weapon. They have been veiy effective at that. We have not stood up to them. We have not done anything on a government to government basis.


Leonard J. Gustafson: Madam Speaker, just one brief comment. I too was at Rosetown. I think the one comment I heard rattling through the 4,000 people who were there was that when some of the politicians got up and tried to take advantage and turn it into a political thing, the murmur-ings came: "Keep politics out of it".
Truly, the farmers were there to try and show government, everybody involved, to Canada-you do not get
4,000	people together that often-that they have some very, veiy serious problems.
We as a government are listening. We have stood with them and we will continue to stand with them. The time has come when it is important that we make food a priority, that food becomes the number one right.
It is interesting that on the one hand there are surpluses and on the other hand there is a starving world. In defence of the government I am a part of, especially in the west or for Canada, I see two options. There is the NDP option which brings in a land bank and takes over the farm, which eastern Europe threw out. They threw that system out. It did not work. There were food lines. Seventy-five years of communist socialism proved to eastern Europe what they can do. Today they are coming to Canada and asking for food, and we are going to deliver it.
October 3, 1991

Number two on the other side is that I think we are in a critical situation. What does the Reform Party say? The Reformers say that all farmers should be cut 15 per cent right across the board. We could not live with that. My goodness, I am a farmer myself. I have three sons farming and I will tell you that it is difficult. This Conservative government put $22 billion into agriculture and even with all that assistance I say it is not enough. It is difficult, but we have been the government that has stood with the farmers.
I guess farmers have to ask themselves if they want radical approaches or one that recognizes the problems that exist. We are listening as a government. We understand. It is well time that international leaders at all levels make food a priority. Certainly it is a human right. If there is one right, one human right that people have, it is the right to eat. We as farmers do not apologize to anybody for being productive, for being hard working and for having produced food. Canadians buy food cheaper than any other people.
I stand with these farmers here today and the farmers across this country and say that we will produce food but we need a fair price.


Victor Fredrich (Vic) Althouse: Madam Speaker, I think the hon. Parliamentary Secretary to the Prime Minister should be reminded that in addition to the items that were said at Rosetown to which I responded to my friend from Regina, we heard a persistent cry for a need for $30 per acre to bring farm revenue up to where the GRIP would have taken them in the 1991 crop year that was completed last August.
The parliamentary secretary makes a plea for not going to radical solutions. I think he has not studied history very well. His government is proposing to go along with the United States and to do away with any support by governments to food production and agriculture. That is a radical solution. It has never been used in the history of the world. It is a new and radical solution. When you look at it clearly and calmly as even right wing economists do, they conclude that the results will not be particularly useful to farmers.
We have had in the last eight years in Saskatchewan more than two farmers per day leaving the province
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under this so-called benevolent program we have been living under. What they are proposing is to move to a program that would do away with all government interference which, I repeat, has never been the policy of any national state or community in the history of civilization.


Madam Deputy Speaker:: As we are resuming debate I understand that the hon. member for Algoma will be sharing time with one of his colleagues. The hon. member for Algoma has the floor.


Maurice Brydon Foster: Madam Speaker, I simply want to be closely associated with the hon. member for Lambton-Middlesex who has proposed the motion as our associate trade critic today concerning the support of the Government of Canada, Canadians and this House of Commons for the retention, strengthening and the maintenance of article XI in the GATT negotiations which are taking place in Geneva this fall.
It goes on to say in this motion that the government will not be party to any agreement that fails to achieve these objectives. I believe this is one of the most important debates that we will have this fall. It is unfortunate there are not more members in the House today for this debate because of the magnitude of it. It is so terribly important. One of the basic underpinnings of a successful, rewarding and viable sector of our agriculture is the supply management sector. Those poultry and dairy sectors of our economy are the most stable and the most self-reliant in our industry. The fate of them will be decided over the next few weeks in the GATT negotiations.
I want to call attention to the spectators in the gallery this morning from the Dairy Farmers of Canada, the Canadian Marketing Agency, CMA, the Canadian Chicken Marketing Agency, the Canadian Turkey Marketing Agency and the Canadian Broiler Hatching Egg Marketing Agency including a group, I understand, from Quebec. It is these producers in the gallery today whose very livelihood, whose job, whose income, whose very ability to make a living is at question in these GATT negotiations. We welcome them to the gallery today for this historic debate.

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It is an historic debate because at this very moment the whole grains and oilseeds sector is also completely undermined because the government has reduced its support programs by $1.3 billion last year. It has failed to provide transitional assistance to the new stabilization program last spring. I do not think there has ever been a time in our history when there has been so much uncertainty in the supply and management sector. Historically it has been the most stable and well underpinned. At the same time that uncertainty is combined with just a desperate uncertainty and cash flow crisis for the grains and oilseeds.
I was especially struck by the response of the Parliamentary Secretary to the Minister of Agriculture today. When he attended the meeting in Madrid of agriculture ministers from across the western hemisphere, he commented to our colleagues here in the House that the matter of the GATT was never even raised. It is unbelievable to me, knowing the incredible uncertainty in the farming sector this year, that he did not raise it. I mean, where else would he have the opportunity to twist the arms of so many influential people, the ministers of agriculture from the western hemisphere, to try to say to them: "Look, article XI is important to us. We are not destroying the world trade with surplus, low quality, low priced stuff. We are restraining our production. We are having a viable industry. Why did he not do it? That is the kind of thing that has our spectators in the gallery very concerned".
It is in the communique. The communique says: "Oh, yes, we want stable agriculture and good relations in the GATT negotiations and all the rest". But he did not raise it. He did not seek their support. If you look closely at his answer, he did not answer.
On the same topic I asked him if it is the policy of the Government of Canada to say yes to our resolution this morning. The resolution simply says that we want the Government of Canada to strengthen and clarify article XI of the General Agreement of Tariffs and Trade in the ongoing multilateral trade negotiations and that it will not be party to any agreement that fails to achieve these objectives. Surely the parliamentary secretary, who speaks on behalf of the government in the House of Commons and on behalf of the Minister of Agriculture,
should have said: "Yes, we agree with that motion. We will not be party to an agreement which fails to achieve these objectives".
That is the same kind of slippery answer that we have had from the Prime Minister, the Minister of Agriculture and the Deputy Prime Minister. They say: "Our position is to support article XI but if there is any change we will let you know". That simply is not good enough. That is almost exactly what the Minister of Agriculture said in response to a question from the hon. member from Haldimand-Norfolk here last week when he said: "Our position is to support article XI until we change it".
That simply is not good enough. This debate today and the whole question of the GATT negotiations is obviously very important to dairy producers, poultry producers, broiler producers, turkey producers and egg producers. There are about 40,000 of them but they employ another
40,000	or 50,000 people, perhaps another 100,000 people in those operations across the country.
They are the most stable, well organized producers in the country and they are self-reliant. They are not lined up at the door of the Parliament Buildings every fall demanding stabilization payments. They may be this fall, but they have not been in the past. If we let them down, you are going to see an exodus in rural Canada, especially Ontario, Quebec, Atlantic Canada, B.C. and many communities across the west including the prairies although they are not as dependent on the supply management sector. But certainly they are the most stable producers in that sector of the country.
We are going to see a withering of rural Canada. If we go the route of the United States-and often we think on this side of the House that is the ultimate plan of the Prime Minister-we will see these industries concentrated like they are in the United States where most of the eggs are produced in Georgia, Alabama and other southern states. You can go to states like Maine, which has roughly the same land mass as New Brunswick, and you will not see many eggs or dairy products produced there.
If we want to talk about regional development, supply management and these sectors have provided the greatest initiative for supply management that we see in this country.
October 3, 1991

This is a very important debate today. I am not getting your signals very clearly, Madam Speaker, as to just how much time I have.


Madam Deputy Speaker:: I do apologize. I wanted to let the hon. member know that there was one minute left. At the same time in answer to his colleague who asked me if there would be questions or comments afterward, I said "Yes, five minutes", which is why my signal was five. I do apologize. I will allow the hon. member to conclude.


Maurice Brydon Foster: Madam Speaker, I was just getting my throat cleared for the debate. I am sorry to learn there is only one minute left. I simply want to say to the government this morning that it is impossible to describe how important this issue is. We and the producers feel that we were sold out on the processing side of supply management commodities in the free trade deal. We do not want the government to do the same thing in the negotiations with GATT. We want the government to stand up and fight for our Canadian position, article XI, whether it is maintained as a stand alone mechanism beside the tariffication of the United States or whether it is retained as the mechanism for controlling.
It is impossible to overemphasize the importance of this to the stability of these producers and to the stability of rural Canada. It is the government's responsibility, with all its lack of qualities and ability to do this, to go into those negotiations, to persuade the Europeans to support our position, and to ensure that article XI is maintained, supply management is maintained, and rural Canada is maintained.


Murray Cardiff: Madam Speaker, in a comment directed to the hon. member, I understand that the member was indicating that I had not raised the question concerning article XI. I just want to make it very clear to the member that in all the meetings I held last week in Madrid, Spain that issue was raised.
I want to be very clear in this House that I did raise the importance of our supply management sector and article XI in particular at all the meetings that I attended last week, just so there is no misunderstanding.
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Maurice Brydon Foster: Madam Speaker, if that is true, I am wondering if the parliamentary secretary could also explain the position of the Minister of Agriculture.
He is reported today to be planning to take retaliatory action against the European community for its subsidization of grain, oilseeds and so on on the world market.
I am wondering if the parliamentary secretary could explain why no action is being taken against the United States. After all, we do have a free trade agreement with it. There are mechanisms for raising disputes.
Clearly it has used the Export Enhancement Program which has $1.4 billion against our imports of grains and oilseeds not only stealing away or invading our traditional markets but driving down world prices. I am wondering why the strategy is to only take retaliatory action against the European community.
I would also like to ask the parliamentary secretary if it is the position of the government-after all, he speaks for the Minister of Agriculture when he is in the House of Commons-that the final portion of the resolution this morning before the House is that we will not only seek to support, clarify and strengthen article XI but that we will not be party to any agreement that fails to achieve these objectives of the resolution this morning.


Murray Cardiff: Madam Speaker, I do not know whether it is appropriate. I did not give the last speech, but I would certainly be very happy to reply to the hon. member on retaliatory action against the United States.
The minister has very recently indicated his position in talking about retaliatory action in the European community, but we have also made very clear what our position is concerning the United States in its export enhancement programs.
I do not want him to feel that we have only targeted one country and not another, because that is not the case.
As far as the motion goes, it is a motion I believe would be supportable. I think our position in this House and as a government is very supportive of maintaining article XI and the future of supply management. I do not understand why it is even in question.

October 3, 1991
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Maurice Brydon Foster: Madam Speaker, it was in the question. I put the question to the parliamentary secretaiy after he spoke because that is the key issue.
The negotiator for the Canadian agriculture section has made it clear that the government certainly raised the concerns among dairy and poultry producers that Canada may be in a position where it is going to have to give up article XI.
What we are trying to say in this motion is that the House of Commons is instructing, asking, directing or requesting strongly to the government that article XI be clarified and strengthened and that we not be party to an agreement in which we are going to give it up, because we believe that the tariffication proposal of the United States will simply ravage our supply management system.
I think that is why we want to know whether the government's policy is to not be party to any agreement that weakens or does away with article XI.


Leonard J. Gustafson: Madam Speaker, I have just a short comment. I am pleased that the hon. member is concerned about the fact that there is representation at the table.
I want to defend clearly on behalf of the government that our Prime Minister has been there, the Minister for International Trade has been there and the Minister of Agriculture is there right now.
Especially being a farmer from western Canada, to have spokesman at the table is important. If you put in these splinter parties that do not represent anyone, they never get to the table. The Liberals should take a good look at that situation.
There was no representation in western Canada. What happens if the Reform Party gets in there? Who does it represent? It is not at the table. The NDP is not at the table. We are at the table and we have done a good job of representing these farmers. We will continue to do that.
It was the Prime Minister of Canada-


Madam Deputy Speaker:: I must interrupt the hon. member. The time has expired. I will allow a few seconds to the member for Algoma if he wishes to respond.


Maurice Brydon Foster: Madam Speaker, I think there is a great paranoia by the hon. member about the Reform Party.
We are not arguing about whether the government is at the table or, as he said in his previous speech, if the government is listening.
What we are worried about is what it is going to do. We know what it did in the FTA and we just do not want it to do the same thing in the GATT negotiations. That is our concern. It is not whether it is listening, it is what it does.
In the cash crisis it has not done anything. On the GATT we are concerned that it is going to give it away. That is what we are concerned about.


Mr. Don Boudria (Glengarry-Prescott-Russell):: Madam Speaker, Canadian agriculture is in a state of crisis. The price of soy beans and wheat is 35 per cent below last year's level and 45 per cent below the fifteen-year average. In fact, losses in the province of Ontario total about $200 million this year. And now, supply management is threatened.

For the government to tell us that article XI of the GATT will not change until the government says it will change is hardly reassurance to the dairy farmers of Canada and the other producers of supply managed goods.
Let us remember that this is the same government that said that it was going to protect Canadian daiiy farmers in the issue of ice cream and yoghurt in the free trade agreement. Look what happened there.


An hon. member:: It sold us out.


Don Boudria: That is right. It sold us out. [Translation]
Madam Speaker, the government has sent some alarming signals during the past few days. I have before me a document published under the title: "Canadian Federalism and Economic Union-Partnership for Prosperity", a document tabled in the House last week by this government. I would like to quote a few passages from page 19. Here, we see a list under the title: "Costs of Barriers". The following items are listed: agricultural supply marketing boards that regulate the production and prices of various food products including milk, poultry and eggs.

In its own document, the government refers to these measures as impediments to trade in Canada. How can the government tell us today that it wants to protect supply management, when in its own document tabled last week, it called the concept a nuisance?

I am worried. The dairy farmers, the poultry producers, the egg producers and others I represent in this House are worried as well. Dairy farming in Canada is a very important industry.

Let me give you a few facts. The electoral district of Perth-Wellington-Waterloo has 1,299 dairy producers. The one I represent, Glengarry-Prescott-Russell, comes second with 1,104 dairy producers. So you see how important this is for my riding! Lotbiniere, 1,089 dairy producers; Beauce, 990 and Bellechasse, 969. These are the five electoral districts in this country with the largest number of dairy producers, mine ranking second.
Madam Speaker, Quebec produces 47.4 per cent of Canada's dairy products and Ontario 31.1 per cent. So you see, this is a very important issue for both provinces, since 77.5 per cent of dairy production is carried on in those provinces, and 75 per cent of dairy producers are in the two provinces I just mentioned.

We are not talking here about a small issue. We are not talking about a major issue. We are talking about something which is fundamental for the survival of that industry, not only in our country, not only in the province I represent, but even more so for my constituents.
Dairy farmers of Canada produced a document for us and made it available to members of Parliament. It is entitled Update on GATT Negotiations, October 1991. They are very concerned about the all too prevalent rumours going on right now in the public domain. They are more than rumours and there is a reason for them. It is that the supply management system we have could be exchanged for other considerations at the GATT and, in turn, we would get a so-called tariffication system.
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And if we had that system, Madam Speaker, Canadian farm producers would lose 20 per cent of their income right from the start, assuming that the system would work and would be in place permanently. I say this because it is quite possible that this government-although its chances of being around for much longer are not that good-might subsequently try to reduce the protective tariffs they introduced. Then, of course, any remaining tariffs would gradually disappear, thanks to free trade. Canadian farmers and dairy producers in Glengarry-Prescott-Russell and elsewhere, would be left with nothing to protect them, and we would see a repeat of what we saw in the United States: a gradual concentration of dairy production and the production of many other farm products.

To those who say: "Well, that is free enterprise'', I say: "Nonsense". There is nothing free about countries battling each other with subsidies. I have no doubt that the dairy producer in my riding is as efficient as the one in New York State. That is not the issue. Why should a dairy producer in Glengarry, in Prescott or in Russell, compete with the Treasury of the United States of America? That is the issue, the long term issue, were we to lose our supply managed system.
Milk prices to farmers could decrease by some 20 per cent under the tariffication system. That could veiy well happen if the government lets go of our supply management system. Furthermore, this pro-free trade government could then lower the tariffs, and remove them completely over time. Canadian dairy, poultry and egg farmers need the protection of existing systems, supply management. We need to preserve that supply management.
The issue is not whether the Reform Party would do worse than the Conservatives. We are not competing for who can do worse. We already know what we have across the way is bad enough. Heaven forbid that we could get worse than this.
We want to make things better and at least keep what farmers have now, our supply management system.

October 3, 1991
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Madam Speaker, the voters I represent in this House want to keep their supply management system. What we need is a government committed to maintaining and improving that system. I say to the parliamentary secretary that our experience of the past few years has shown us what the government's commitment or so-called commitment is worth. We saw it in the Canada-U.S. talks, and we saw it in the ice cream and yogurt dispute.
I remember a political debate in Saint-Isidore de Prescott, in my riding, where the Tory candidate sitting next to me, who incidentally received a whopping 19 per cent of the votes, tried to convince my constituents that ice cream and yogurt would be protected under the Free Trade Agreement. The farmers in my riding didn't believe him, and they were right not to, simply because it didn't happen.
In the past, I have seen how we lost out under this agreement, and my constituents and I are afraid of what might happen now at GATT I have confidence in the farmers in my riding and across Canada, but I certainly do not trust the government opposite to protect their rights. And members opposite will have to prove they mean what they say, because in the past, they have given the impression they want to terminate our supply management system.
Today, we will see whether the government opposite votes in favour of the motion.

That is what we need. We need to arm our negotiators with a clear resolution of this House, that we want to keep, retain, enhance and improve our supply management system for our country.


Dennis Joseph Mills: I want to thank my colleague from Glengarry-Prescott-Russell. Last year I had the privilege of visiting Moscow and Riga, Latvia. When I was there I noticed that every morning on my way to this environmental symposium that I was attending that people would start lining up at the grocery stores at about seven o'clock, sometimes even earlier than seven o'clock, hopefully to get in there and hopefully get a little bit of bread or cheese. Very rarely did I see milk. Sometimes the meat that was there, I must confess I don't think we would have used that quality of beef on
our pets here in this country. It was the most shaking experience that I ever had when I was in Moscow for that period.
We have heard a lot today about supply management and we are addressing our remarks primarily to the farming community. As an urban member of Parliament I would like to ask my colleague from Glengarry-Prescott-Russell what effect this is going to have on security of food supply and also prices for people in our major urban centres. We need our urban community, the people in downtown Toronto and downtown Montreal, to understand what this debate is all about today. With respect to all rural members, I wish when you address your remarks today that you could put in your speeches what effect this is going to have on the consumers.
With all due respect to the farming community-and I care and I understand from my colleague from Lamb-ton-Middlesex who has done this fabulous document on Compare the Share-we need to communicate, not to the 300,000 farmers in this country who are suffering and who are in deep pain, but with the 25 million other consumers who are out there.
Madam Speaker, through you to my colleague, what effect will this have on my constituents who are not farmers?


Don Boudria: First of all, I want to congratulate and thank my colleague from Broadview-Greenwood. It is important for all members, whether they be rural members like myself or urban members, to be interested in agriculture.
Every time we have a debate on agriculture in this House, some urban members are very, very interested, and the member for Broadview-Greenwood among the most interested, if not the most of all urban members, and I congratulate him for that. Of course, the people on the farms produce the food and the people in the city eat the food, and they have to remember that. The member for Broadview-Greenwood knows that.
In terms of the remarks of the hon. member for Souris-Moose Mountain who qualified me as an urban member, the village of Sarsfield where I live has 230 people living in it. That is urban Canada, Madam Speaker.
October 3, 1991

I was raised on a farm and I now live in that village of 230 people, that vast metropolis of Sarsfield.
What the member for Broadview-Greenwood said is very important. We have in Canada the highest quality of food in the world. We have a very reliable supply. When did we ever hear we had run out of milk in this country? We do not. We do not run out of supply managed commodities. The system is reliable, has worked for decades, is stable, and provides a reliable, though not fantastic, source of income for our producers.
Speaking of what this does for the producer, some people-and I hate to name the Consumers' Association of Canada, but I will anyway-say that supply management is costly.
I beg to differ with those people whom I hate to mention, the Consumers' Association of Canada, but I will do it anyway. They are wrong and they often are.
Let me tell you for instance that in 1980 the income going to farmers for a litre of milk at that time was 38 cents and it has jumped to the huge amount of 57 cents over 10 years.
But do you want to know something, Madam Speaker? The price to the consumer has gone from 75 cents to $1.48. In other words, it is not the farmer whose income is increasing. It is those elsewhere in the chain who distribute and sell the food to consumers. That is why the price is skyrocketing but the farmer is not getting his or her fair share.


Some hon. members:: Hear, hear.


Madam Deputy Speaker:: Resuming debate. The hon. member for Kamouraska-Riviere-du-Loup, Parliamentary Secretary to the Minister of International Trade, has the floor.


Mr. Andre Plourde (Parliamentary Secretary to Minister of International Trade):: Madam Speaker, since it came into power, the government has shown unwavering support of supply management. We believe it has been and should continue to remain a crucial element in Canada's agricultural policy. In this regard, we have been working with the provinces and the industry to ensure that supply management remains an up-to-date viable policy tool.
Thus, in the domestic agricultural policy review, we and the other stake holders in the supply management systems have been working hard to develop "second
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generation" supply management. We all recognize that supply management is a dynamic concept which has to adjust to changes in the market place if it is to continue to serve producers, processors and consumers into the twenty first century.
Since 1947, the GATT has recognized that if governments effectively control supply, there should be a corresponding discipline on imports. Article XI,2(c)(1) of the GATT thus provides the international authority to apply import quotas in support of effective supply control systems.
Unfortunately, a number of recent GATT panels have recognized that the current GATT rules require clarification. In particular, there is a pressing need to clarify which processed products can be placed under import control. In the case of the dairy sector, milk is under production control, but it is dairy products which are traded internationally.
Madam Speaker, the industry, the provinces and the federal government have thus agreed that a key Canadian negotiating objective in the multilateral trade negotiations is the strengthening and clarification of article XI. We have pursued this objective vigorously throughout the negotiations and will continue to do so.
As you are aware, Madam Speaker, Canada's negotiating position on agriculture has been developed in close cooperation with the provinces and all segments of the industry. It represents a truly national consensus that all segments of Canadian agriculture stand to benefit from an international trading system which is based on effective rules which are equally applicable to all countries and all commodities.
All segments of the industry recognize that trade barriers and trade distorting subsidies must be progressively reduced. Madam Speaker, it is crystal clear that the current distortions and uncertainties in agricultural trade are just as disruptive to a Canadian dairy farmer as to a Canadian grain producer. The status quo is not acceptable to either.
Our export commodities need improved access to markets and a substantial reduction in all forms of trade distorting subsidies. Our supply management sectors need to know with certainty what the international rules are, so they can operate their systems accordingly. All of these interests are reflected in a balanced way in the Canadian agricultural negotiating position in the Uruguay round.

This government has forged a national agricultural consensus that the agricultural trade interests of all the regions and all of the commodities should be pursued aggressively in a way which does not prejudice the interests of one at the expense of the other.
Is the Opposition seriously suggesting that before we even know what is really negotiable, we should completely ignore the vital interests of all regions and commodities which will require a successful result? The Opposition may choose to do so, but we in this government will continue to pursue a balanced negotiating position which reflects the nation's agricultural interests. We will continue to consult closely with all segments of the industry and all provinces as we enter the last few months of the negotiations in Geneva.
Madam Speaker, the moment of truth is fast approaching. The Director general of the GATT has said that November will see the making or breaking of the negotiations. In order to set the stage for these crucial weeks, Mr. Dunkel, the GATT Director General, has indicated that he will put forward a comprehensive negotiating proposal on agricultural, as in other sectors, which he hopes will provide the basis for an agreement.
It is this government's intention to consult with the provinces and the industry once we have Mr. Dunkel's proposal.
The Minister of State for Agriculture is in Geneva, at this very moment, meeting with Mr. Dunkel, in order to strongly make known Canada's views on this important question. We will miss no opportunity of ensuring that Mr. Dunkel is aware of Canada's concerns, which he is drafting those proposals.
The Minister of State for Agriculture, the hon. Pierre Blais, issued a press release dated September 30th, in which he said: "We are firmly resolve to negotiate an agreement that will protect our supply management programs and, to this end, we will make every effort necessary to obtain a clarification and strengthening of article XI of the GATT". Mr. Blais reiterated that commitment to representatives of Canadian marketing boards during a meeting in Ottawa this morning.
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When the negotiations in Geneva resumed, Mr. Blais met with officials of Canadian marketing boards for chicken, turkey, hatching eggs, chicken raised for meat, as well as the dairy farmers of Canada, in order to look at the evolution of the situation since last July.
Madam Speaker, Mr. Blais, who is going to Geneva, will have meetings regarding the GATT negotiations on agriculture and intellectual property. He will also meet the GATT Director General and the President of the negotiating group on agriculture, Mr. Arthur Dunkel.
The minister will then go to Paris where he will meet the president of I'Union des producteurs agricoles du Quebec, Mr. Jacques Proulx, to look at the situation regarding the GATT negotiations.
In concluding, Madam Speaker, we intend to examine in detail the negotiating position of each country before deciding whether the emerging agricultural package is a deal which would be in the interest of Canadian agriculture. Madam Speaker, to do otherwise will be irresponsible. Canada's agricultural export interests and our supply management interests coincide in that both of them need a successful Uruguay round and both would be adversally affected by a failure.


Mr. Milliken:: Point of order, Madam Speaker.


Madam Deputy Speaker:: The hon. member for Kingston and the Islands on a point of order.


Peter Andrew Stewart Milliken: Madam Speaker, I believe that there is unanimous consent for the House to sit between one and two o'clock today.


Madam Deputy Speaker:: The House has heard the suggestion made by the hon. member. Does the House give its unanimous consent?


André Plourde: Point of order, Madam Speaker.


Madam Deputy Speaker:: The hon. parliamentary secretary on a point of order.


André Plourde: Madam Speaker, if my hon. colleague would give me two or three minutes, I will find out whether there is unanimous consent on our side. No one informed me that we were to sit during the lunch hour. So if you allow me, Madam Speaker, I will go check and come back.

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Madam Deputy Speaker:: We will now go to questions and comments. Resuming debate.


André Plourde: Point of order, Madam Speaker.


Madam Deputy Speaker:: The hon. parliamentary secretary on a point of order.


André Plourde: Working so fast, we give our unanimous consent to sit through the lunch hour, Madam Speaker.


Mr. Lyle Vanclief (Prince Edward-Hastings):: Madam Speaker, just before I comment in support of the motion before the House today, I must point out to the government that it must guarantee to Canadian supply management sectors that the system as it is at the present time will stay in place.
I would like to point out to the Parliamentary Secretary to the Prime Minister, who has unfortunately had to leave the House for a moment, that he made some comments earlier this morning about the importance of people listening to someone. I want to remind him of a story, because I do not think the Parliamentary Secretary to the Prime Minister is getting the point of all of the groups of farmers who are coming to see him and his colleagues, the thousands of farmers who are coming out to meetings.
I will remind him of a story about the sheep farmer who was talking to a group of people and telling them that because the wolves were destroying his sheep, they should destroy the wolves. Someone in the crowd stood up and said that maybe what would be a better route would be to neuter the male wolves and therefore that would look after it. The shepherd's response was that that person did not understand the situation. The wolves were not molesting his sheep, they were eating them.
I would remind the hon. parliamentary secretary that the concern the supply managed dairy, egg and poultry producers have at the present time is that this present government is going to throw them to the wolves if they do not protect the system on their behalf for these producers. Further to that, I would like the parliamentary secretary or someone from the government to explain to Canadian producers and to this House and to those who are watching what their definition of supply management is. They do not seem to make that very clear.
In the last few weeks they have continually asked producers why they do not think a system of tariffication would work. If we look at the minutes of the Standing Committee on Agriculture from a week or so ago, when one of the chief negotiators going to GATT on our behalf was there, there was a fair bit of that type of comment made. Madam Speaker, if you listened to what the previous speaker said, he spent a fair bit of time talking about tariffication. Perhaps we are going to have to have a look at that type of thing. I agree that we have to look at different systems, but the point being made is that we cannot throw our system and our producers and what they have done for the Canadian economy and Canadian consumers to the wolves.
Without primary agriculture, which is the production of food and fibre, there is no question that many rural communities would disappear in Canada. Unfortunately, that has already happened to some extent.
The University of Guelph in a study and a report they put out in conjunction with some other groups over a year ago outlined that the agrifood industry, which the supply managed sector plays a role in, is a $42 billion to $43 billion industry in this country. We all know the discouraging situation that is faced by Canadian grains and oilseed producers at the present time when their returns in real terms are worse than they were in the 1930s.
Added to that concern of farmers and producers in this country are the concerns of our supply managed sector, our dairy, egg and poultry producers. They can very easily see the distinct possibility of the erosion of the system that they have for their production and for the production of the benefits that they have and they provide, not only to the consumer but to our society in general.
We must recognize, and I do not think any Canadian can complain, what this sector has been able to provide to everyone including the farmers, consumers and society in general. This system is one that allows a decent return on investment. I do not think anyone can object to that. It does not allow an exorbitant return on an investment. It allows the owners, the operators and the employees a decent living, not an exaggerated living. It provides Canada and Canadians with a steady source of nutritious, wholesome and the safest food in the world.
October 3, 1991

How better can we provide all of these things to Canadians than to have them produced in our own country under our own eyes, rules and regulations? This does this. It does not guarantee this for every producer in that sector but it provides that for the efficient producer. When we talk about efficiency, let us look at what these sectors have done for Canadian consumers.
The dairy industry for example, since 1971, has increased its efficiency 71 per cent; our American counterparts, 46 per cent. New Zealand dairy producers have only increased their efficiency somewhere in the low thirties and western Europe in the single digits.
The economic viability in these sectors of our agricultural community, because there has been some economic viability and a system in place that allows a decent return on investment and a decent labour, has provided this sector of our agricultural community the opportunity and ways and means to do all of those other things that our society wants today; that is, to carry on sound management practices that will put into place the proper control of the soil, crop rotation, water conservation, soil erosion and the proper care of the environment. Unfortunately, because of the disastrously low returns in some sectors of our agricultural community today, even though farmers know how to farm better, they cannot afford to do so.
In every case, who knows better what is best for the soil, for water, soil and wind erosion, than the producers. In the grains and oilseed production right now a bushel of wheat returns a western farmer $2 a bushel. They know how to farm better, but the returns are just not there in order to allow them to have the equipment and carry out the practices. Therefore, in some cases they do not do as good a job as they should and they do not do as good a job as they would like to.
I would say that this sector has not only provided a decent return to the producer, but it has also provided a proper and decent return to our society and to our consumers in general.
I stress, between the dairy, egg, poultry and meat sectors, there are 40,000 producers in this country, 40,000 businesses. We talk about the plight of the small business. Some of those businesses are relatively small and some are relatively large. But we are talking about the
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economic viability, the economic future and the social concerns and the social effect that will have and the spin-off to the suppliers they buy from, to the people they sell to, to the processors they provide. We are talking about 40,000 Canadian businesses.
I ask this government what it has done in the recent past to tell Canadian consumers the benefits of the supply managed sector in this country.
I beg to question. I do not think it has done very much. I do not think, with the attitude it has of open free market, give it heck, way of doing business, that it cares that much. If it does, it has not not indicated it.
What has this government done to tell the other 100 countries involved in the GAIT" negotiations the benefits of the system that we have here in Canada and what it does for the producer, the consumer and the environment, the social fibre and fabric of our country and what it does for our whole society in general.
I stress to everyone that it does more than put food on the plate. The agricultural sector plays a major role. It is one of the four wealth creators in this country, the other three being fishing, mining and forestry. If the primary producer, the initial person in that chain, does get a reasonable return on their investment, labour and their management, how could they, as any business, stay in place?
Referring back to the comment at the beginning, this government does not seem to understand the importance of working and selling this on behalf of Canadian consumers and Canadian producers. It seems to be willing to very systematically consider throwing them to the wolves.
I do not think there is much more I can say. I only have one minute left, so I do not have to say much more. I hope I have made the point. This sector of the economy, agriculture production, is not asking for protection for the sake of being protected. As we have seen from documents prepared by colleagues, they are not getting a very large share of what the consumer pays. When we look at how much their share has increased in the last 10 years compared to what the consumer has paid, they are not getting an exorbitant increase. They are getting a fair share of the increase.

October 3, 1991
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I call upon the government to explain to Canadians better than it has, and I am afraid, better than it cares to, the role this plays and how important this sector is, not only to the agricultural community, but to Canadians in general so that we can do what they have done for all of us in the future.


Mr. Greg Thompson (Carleton-Charlotte):: Madam Speaker, I have a comment in relation to what the previous member just stated.
The hon. member and I entered this House at the same time in November 1988. Since I have been here, I do not think there is anything that would indicate that we are about to dismantle supply management. I think every time the former Minister of Agriculture, the present Minister of Finance, has been on his feet in this House in the last three years he has indicated our support as a government for supply management.
During recent GATT negotiations and the breakdown of those negotiations, we have continually sought clarification and a strengthening of Article XI. We very strongly support Article XI, we support supply management and we have no intention of abandoning that.
How we can drive that message home any clearer than that I do not know, because the present Minister of Agriculture is in Brussels at this very moment and that is the message he will be carrying: We have no intention of dismantling supply management.
I come from a farming community. I was on the telephone to some of my own farmers yesterday and they are very coiicerned about that. Believe me, Madam Speaker, I have no intention of moving off of that target myself. The object is to maintain it, clarify it and to strength it because it is very, very important for me as a member of Parliament. That is a major part of my constituency, as with the member who has just spoken. It is a very important part of my constituency and an important part of his.
Agriculture is the backbone of rural Canada and I do not want in any way, shape or form to be a member of a government that is going to abandon that. It is very, very important that we continue, all of us on both sides of this House, to encourage the strengthening of our supply management system through article XI. Our present Minister of Agriculture is doing that at this very moment in Europe.


Lyle Vanclief: Madam Speaker, I do not question the fact that the present government has said that it is going to stick up for supply management, but what I will remind the remember of and what I asked someone in my speech for a definition, is what is the present government's definition of supply management. If it is the same as we have at the present time, why does it not say so? If it is going toward the United States suggested proposal of tarrification, let us fess up and let us tell the producers that that may very well likely be the case. But the government is not saying that.
The concern out there in the producer organizations and on the farm, and they keep asking the question, is why would tarrification not do the job that is being done now?
I remind this House that tarrification will not do what the present system does because tarrification opens the door, sticks the toe in and begins the ratcheting down of the system that is there at the present time.
Before I sit down, I want to remind the House that the speaker who just spoke said that he could not and would not be part of a system that did not protect supply management as we know it now. If that does not happen I would expect that the member would have to see fit to step down because he did not want to be part of that government.


Mr. Bob Speller (Haldimand-Norfolk):: Madam Speaker, today we are not just participating in another opposition day or discussing another opposition motion. Rather, we are discussing an issue that concerns all Canadians and all members of Parliament. It is a survival of our food production sector.
We have heard a lot about the desperate plight of farmers in the last year, but I believe that any clear-minded individual would agree that our agricultural sector is going through a serious crisis, the worst probably since the Depression. How bad is it? In July the Ontario Federation of Agriculture declared: "A plunge in grain and oilseeds prices, the rush by governments to get out of ad hoc programs, have left Ontario agriculture in a state of emergency". OFA president, Roger George went on to say: "Prices are down dramatically. Ministers McKnight and Buchanan had better start taking the situation of Ontario farmers seriously or there won't be any farmers left to make the transition from ad hoc payment to the new safety net programs".
October 3, 1991

I believe the agricultural industry is in dire straits. That is why I asked the House of Commons Standing Committee on Agriculture to be called back in August to deal with the crisis facing our farmers.
Representatives from prairie pools presented a submission to the committee which indicated: "Grains and oilseeds producers are in a desperate financial situation. Prices have been bad and they are getting worse. The younger guys are starting to say there is no future in it for us" unless they have other sources of income. The average grain producer will be living well below the poverty line. That is how bad it is.
These people are not crying wolf. I had an opportunity to spend some time in western Canada this summer and talked to many farmers. It was alarming to hear the prediction that unless something is done quickly, and I emphasize the word quickly, 40 per cent of all farmers will be forced off the land this year. If things do not improve, 30 per cent more will be forced off next year.
Farmers continue to provide a high quality food. Yet they receive less than the cost of production for their labour. Does that sound fair to anyone in this House?
Many areas in Ontario have the worst crops in recent memory and have nowhere to turn. But there are none of their members in this House today addressing this issue.
Farmers and agriculture are the cornerstone of our economy. We have heard that time and time again by probably all members of Parliament. In the past they have resolutely accepted the increasing losses of income with an external optimism only found in rural Canada.
However, this hope has all but been extinguished. Farmers are desperate. Farm families are dedicated to providing food for Canada and the world. They have given all they have. They have given their savings, their homes and their futures and they cannot give any more.
There is a feeling of desperation and despair in rural Canada. That stems from a feeling that no one cares, that this government does not care for them.
Rural Canada is suffering. When agriculture suffers, everyone suffers, the country suffers. Low commodity prices, poor crops and international subsidy wars will
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mean the demise of many more farmers in this nation if we do not act now to save them.
Members opposite are saying: "Why get into this now? We thought we were discussing the GATT situation". We are talking about farmers in desperate need, the grains and oilseeds producers. But who are the farmers who have the most stability in our system who under normal circumstances can pay most of their bills, look their banker straight in the eye? It is the supply managed commodity farmers that can do this.
Is this a coincidence? I do not think so. These producers operate under marketing systems that assure Canadians adequate supplies of safe and nutritious food at fair prices while providing some sort of efficient income for these producers. These are the farmers that this motion is dealing with. These are the farmers that will be in an equally desperate situation as the grains and oilseeds producers, if we do not stand up for them now and defend them at the GATT.
We have heard the Minister of Agriculture, the Minister of State for Grains and Oilseeds, the Minister of Finance and the Minister for International Trade and our negotiators all say that they support supply management and that they are committed to seeing the strengthening of Article XI of the general agreement.
The question is: Can they be believed? They have mouthed support for grains and oilseeds farmers. They said that they are going to protect them. They have admitted that there is a $1 billion shortfall this year for the 1990-91 crop year.
Have we seen anything? Have the farmers got anything in their pockets yet? No. One might legitimately ask: What is its ultimate objective?
I believe this government is hell bent for leather to destroy the department and the industry that we have built together over a long period of years.
Always remember, it takes longer to be a builder than it does to be a wrecker. We have had how many studies in the past three years? I would say about a dozen. What did it tell us? Anything new? It did not tell us a damn thing.

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It basically tried to implant in people's minds that farmers were inefficient and must become more market oriented. All the facts and figures I intend to show will prove otherwise.
The agriculture producers of this land have become the most productive people in our society and have reaped the smallest reward for their efforts.
These highly efficient producers have been falsely attacked by both inside and outside this government. The former Minister for International Trade stated that the Minister of Agriculture should be ashamed of himself for his actions in subsidizing farmers to the tune of $8.8 billion.
It is an out and out falsehood. It is a direct lie. Never in previous history have moneys received from the marketplace been called a subsidy in an international GATT meeting.
It is a damn falsehood, and it is a lie. I believe that this is a purposely orchestrated attack to deter people's minds from the really costly culprits in our society.
Millions are spent and lost. Consumers are paying much more than they should per producer, in some instances increases in prices of over 150 per cent, and not a peep out of anyone in those benches. Why? Is this a special vendetta against a minority group of people? I think so, but why?
The highly subsidized professors and civil servants who pay for economists subsidized by the big food chains are dictating to them what they should write. I want to make it clear.
I see nothing wrong with criticism as long as it is accurate and honest, but half truths, supposition and lies I will not accept and neither should anyone in this House.
We have built an agricultural industry that is second to none in the world, one that allows farmers some say in the marketplace, one that is subject to public scrutiny like no other producing sector of our society. These are the farmers we are defending in this motion.
In many cases it took years to build these marketing structures such as the Canadian Wheat Board, the
Canadian Dairy Commission and the poultry marketing boards. These are all legal structures, allowed by our democratic provincial parliaments and our federal Parliament. These are not illegal entities. They are subject to more scrutiny than any monopolistic multinational that you can find.
My hon. friend from Lambton-Middlesex was speaking this morning. He suggested that the former minister for trade was directly misleading Canadians and totally misled this House in the facts that he presented to GATT and in this House last October 15. I think he was calling him a liar and I think that if the former Minister for International Trade did not withdraw those comments and did not correct those comments in the paper, he was lying and that the hon. member was right.
I know my time is up, but I want to finish by saying this. I thank the hon. member for his comments. I want to end by saying that the government has proposed that it is protecting our supply managed commodities.
I was at the GATT last summer, and I met with people from the European commission. They told me that they had not once heard from this government on article XI of GATT. That was well after the negotiations began, so who do you believe? Do you believe the members or the ministers of the Crown who get up and suggest that they are protecting supply management?
Do you really believe the European community which is negotiating this, which said directly that the minister did not, nor did anyone from this government, ever bring forward supply management as an issue?
I see my time is up, Mr. Speaker, and I thank you for your indulgence.


Gregory Francis Thompson: Mr. Speaker, I do not mind taking part in a debate and responding to anything in this House but there were many inaccuracies in the previous member's comments, particularly in relation to the GATT. He knows full well that our agricultural minister worked very hard on behalf of all farmers in Canada to ratify strengthening article XI, that which pertains to marketing boards, that which defines marketing boards in this country.
That is absolutely absurd.

He might have been to the GATT negotiations for an hour or two hours as an observer but he certainly was not there to watch what our minister did on our behalf as farmers of Canada.
I suggest that his remarks are totally off base and inaccurate and I suggest that he withdraw those remarks.


Robert (Bob) Speller: I was only relaying facts as I met with many members of the European commission over a period of a week that I was there.


Gregory Francis Thompson: Point of order, Mr. Speaker, what he is telling us is third party rhetoric or hearsay and if he is referring to it in that sense he should spell it out clearly because that is not what he said in his original comments. It is third party gossip that he is referring to.


The Acting Speaker (Mr. Tremblay (Quebec-Est)):: That is not a point of order.


Robert (Bob) Speller: When I was over there last July I met with them and asked what the position of the Government of Canada had been on supply management. They said "silent". They had not met us, had not yet talked to us about that. I indicated surprise because our government has been saying back home all the time that it was standing up for supply management. They were somewhat shocked by the fact that all this rhetoric was going on but the government had not really put any major proposals to them on this.
I am just telling the member straight what the European community told me. It is not gossip. It is exactly what it told me. If he infers from that that his ministers are lying then that is up to him. I cannot say that directly. I can only tell you the facts on what these people told me.


Mr. Gaby Larrivee (Joliette):: Mr. Speaker, I think that we are going through an extremely difficult period in almost all sectors, but especially in our country's farming industry.
Today's debate could be worthwhile if together we sought ways to support our farmers instead of trying to insinuate all sorts of things that could lead the people to believe that the government is doing nothing to help farmers, which is absolutely false.
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I find the arrogance shown by my colleague extremely unfortunate in that he seeks information in Europe and tells us that the government is doing nothing or doing a bad job when the whole policy and strategy and the proposals were developed in Canada with the farmers- that is the position our negotiators took and maintained from the beginning.
I find it insulting for our Canadian farmers to be told that the government is not defending them properly when we know very well that the government is maintaining and putting forward in Europe proposals that were worked on here in Canada. I think that my colleague should have become much better informed here in this county about the decisions and proposals instead of going to Europe to ask foreigners what our position should be or what position has been taken.


Robert (Bob) Speller: I say to my hon. friend that I am showing no more arrogance than the Minister for International Trade did to farmers when he told the Minister of Agriculture, in response to my question, that farmers were getting too much money. You tell me about arrogance. I would remind the hon. member, who represents an area with a number of dairy farmers, a number of supply managed commodities, that it has been this side of the House that has been running this issue for the last two years.
I ask the hon. member where he has been and where his colleagues have been on this issue.


Mr. Ken Monteith (Elgin -Norfolk):: Mr. Speaker, I am pleased to join this debate today and state the government's position on negotiations under the General Agreement on Tariffs and Trade regarding article XI.
Canada is inescapably a part of the global economy as a country whose prosperity depends on the export of almost 30 per cent of what it produces, about 50 per cent for agriculture. It is essential to Canadians that the world trading system is fair and open. That is why this government has dedicated so much effort to the Uruguay round of multilateral trade negotiations under the GATT. We strongly believe that the best way to ensure long-lasting beneficial trade relations is through an open, stable and free trading world marketplace.

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Canada has been actively participating in the Uruguay round negotiations for the past five years and has been pushing for a strengthened and balanced set of rules regarding agriculture. Canada will continue to do so.
A successful resolution of the MTN is one of Canada's highest trade priorities. It is founded on the simple principle that the fewer trade barriers there are between countries, the more prosperous these countries will be.
The current rounds of talks began in Uruguay in September 1986. We had high hopes that we would achieve breakthroughs in many fields, as for the first time agriculture was in the forefront of the discussions. It was this government that insisted that agriculture be at that forefront.
It was a long journey, both literally and figuratively from Punta del Este to Brussels where the round was supposed to conclude last December. Along the way those hopes were tempered, almost dashed, but the work continues and our goals remain the same.
Canada's goals were spelled out in our offer which was tabled in Geneva last October, almost a year ago. I would like to review them.
We as a government, as a country, are seeking substantial reductions in trade distorting subsidies, particularly export subsidies. We want improved, predictable and more secure access to export markets by a reduction in tariff and non-tariff barriers. We would be prepared to offer comparable access to our own markets as well.
We want clearer and fairer GATT rules that apply equally to all countries, including a strengthened and clarified article XI, the elimination of a country's specific exemptions and better disciplines on the use of countervailing duties. Finally, we want to see the development of a framework of rules to prevent the abuse of health and sanitary regulations as disguised barriers to trade.
We have developed a balanced and comprehensive offer which is consistent with our objectives of substantial trade liberalization, fairer and more predictable trade rules, and equal treatment among GATT countries.
Canada's offer and objectives in the MTN remain unchanged.
We continue to pursue those objectives because we are convinced that an agreement which achieves them will be beneficial for all Canadian agriculture.
The clarification and strengthening of article XI remains a key objective for Canada. Our proposal, tabled last year, includes specific proposals for clarifying a country's rights and obligations through rules on product coverage for processed products, the meeting of effective supply control, the establishing of import access and new disciplines on exports. This balanced proposal was developed in close consultation with all sectors of Canadian agriculture and enjoys the support of the entire agrifood industry.
Canada has vigorously pursued the proposal of article XI, working with other countries including the EEC, Japan, Austria, Switzerland, Norway, Finland and Korea, which support the retention and clarification of article XI. In fact most countries supporting the continuation of article XI have indicated that they believe the Canadian proposal should form the basis for negotiation.
If this kind of agreement is reached, governments will still be able to provide support to the agricultural sector. Our objective is to make sure this support is provided in ways that are less trade-distorting. However, a number of countries continue to be of the view that all non-tariff barriers should be converted to tariffs, including import controls under article XI.
An agreement along the lines of our over-all position would also carry other benefits including improved and more secure market access, clear enforceable GATT rules, improved market stability and improved GATT mechanisms for resolving disputes.
It is important to note, Mr. Speaker, that we are not alone in this struggle. Canada is one of the original members of the Cairns group of developing and developed countries. This group of medium-sized agricultural exporters is dedicated to promoting agricultural trade reform. The Cairns group played an important role in making agriculture a priority on the agenda at the GATT ministerial meeting in Uruguay in September 1986 and we are continuing to work closely with the other members to achieve our goals at the MTN.
The Uruguay round has tried to deal with some very contentious issues. Not surprisingly, the task has been difficult. The European community especially has not been able to reach internal agreement on how to revise its common agricultural policy. The United States in turn has been unwilling to stop wielding its big stick in the export enhancement program.
October 3, 1991

As a result, we have witnessed a long and very destructive trade war and Canadian farmers have been caught in the cross-fire. The U.S. and the EEC have been using massive export subsidies that hurt all exporters. Canadian farmers feel the impact of export subsidies directly because the prices they receive are based on world markets. The Canadian Wheat Board sets its initial payments on the basis of international prices. The low world grain prices this year are reflected in the Canadian Wheat Board initial payments for wheat of only $95 per tonne.
Yesterday, the Minister of Agriculture met with EEC agricultural commissioner Ray McSharry to press for an early completion to the current negotiations and to emphasize Canada's objectives with respect to the GATT. During that meeting, Mr. McSharry assured our Minister of Agriculture that the EEC continues to support Canada's position on article XI.
Our Minister of Agriculture underlined to Mr. McSharry that extreme difficulties were being experienced by Canadian grains and oilseed producers as a result of the destructive EC and U.S. export subsidies.
The minister similarly raised concerns about these damaging export subsidies and the need for clear and freer trade rules, including the strengthening and clarification of article XI when he met recently with U.S. Agriculture Secretary Ed Madigan.
Today the Minister of State for Agriculture is in Europe to reaffirm Canada's position at the GATT. Tomorrow he will meet with Arthur Dunkel, Director General of the GATT, to make our concerns clear.
Mr. Dunkel has been holding technical consultations with delegations since February. He has been working hard to facilitate the detailed negotiations that must occur this fall if talks are to conclude successfully.
As I mentioned before, Canada's position at the MTN was developed in consultation with all stakeholders in the agri-food sector. We are continuing to consult with both industry and the provincial governments as talks progress.
As negotiations proceed in the coming months, Canada and other countries supportive of article XI will need
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to continue pressing the case for strengthening and clarification. This period will obviously be one of uncertainty about the outcome of negotiations. It is therefore important that all those having an interest in supply management, government and industry, work closely together to achieve our common objective.
It is in our interest and the interest of the international trading system that we achieve an international trading system based on rules that treat all players as equals. That is why we have worked as a government and continue to work so hard for a successful conclusion to the MTN.


Gregory Francis Thompson: Mr. Speaker, I have a question for the member who just spoke.
It has to do with the motion of the day. As we know it is an opposition day, but the opposition seems to be very much focused on our abandoning of supply management. The question to the member is simply this: Can he see any evidence where this government might be weakening its position with regard to supply management or any sign that this government may indeed want to abandon its position with regard to supply management?


Ken Monteith: Mr. Speaker, I thank the hon. member for the question.
There have been a lot of discussions in the past two or three weeks about supply management in Canada. I see no evidence that Canada is weakening its position.
As a matter of fact, I believe there was a meeting yesterday of all the supply management groups in Canada and at that meeting, as I understand it, those supply groups supported Canada's position.
They supported the fact that Canada is continuing to fight to protect supply management in Canada. We have done that from the beginning as a government. There has never been a government in Canada that protected supply management more than this government.
What government managed to have agriculture put in the forefront, on the front burner at the discussions at GATT? It was under a former Minister of Agriculture from my riding that those talks were put on the front burner, because of discussions by him and our present Prime Minister.

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There is no evidence that this government is weakening its position. We are prepared to continue with our position of supply management for Canadians because we recognize the fact that it has been of tremendous benefit to Canadians, both producers and consumers. We will continue to do that.


Robert (Bob) Speller: Mr. Speaker, I wonder if my hon. friend from a neighbouring riding is aware of the fact that Mr. Mel Clark, a former deputy negotiator for free trade and the GATT, spoke about a program where the former Minister of Agriculture talked about the government's position on supply management.
The former minister said: "The Conservative government has defended the right to establish marketing boards in the past and will continue to do so in the future, but ice cream and yoghurt is a GATT issue and not a free trade issue and the GATT waiver for certain U.S. agricultural products is most unfair".
Mr. Clark said he reviewed Mr. Mazankowski's statements. I am just reading from his remarks and he says that: "(a) and (b) are simply not true, (a) being that the Conservative government defended the right to establish marketing boards in the past and will continue to do so. And (c) is a part of an attempt to hide from Canadians the effect of the FTA on marketing boards".
I am wondering if my hon. colleague is aware of these comments and may I have his views on this.


Ken Monteith: Mr. Speaker, I thank my hon. friend from the riding of Haldimand-Norfolk.
The hon. member has raised the issue of whether or not a former, very distinguished Minister of Agriculture for this country, supports supply management and free trade for Canada.
I think it has been stated on many, many occasions that this government has indicated that both are necessary for Canadians. We have indicated many times, in many speeches in this House that we wanted the GATT to be clarified. We felt there were many things that needed to be clarified for many countries so that we know exactly where we stand when we are exporting and talking about subsidies, whether it be export enhancement subsidies or domestic subsidies.
That has been our position all along and we will continue to support the farmers of Canada as we have done in the past.


Mr. David D. Stupich (Nanaimo-Cowichan):: Mr. Speaker, it has been a long time since a Minister of Agriculture, the Hon. Eugene Whelan, used to tell Canadians that we do not have a food subsidy situation in Canada. What we have is a cheap food policy in Canada. I used to tell the people in British Columbia that we were not subsidizing farmers, we were subsidizing consumers.
I do not intend to say very much about our grain growing. That is something with which I have had no personal experience, other than to say this. With respect to grain, it is costing a lot of money to produce the grains we are exporting and, to some extent, using here. I believe 80 per cent of grains and oilseeds are produced for export, not because we want farmers to grow feed or oilseeds or grains as such, but rather because we need something to export. These commodities make up our second largest export class in Canada.
Last year alone, 1990, we paid some $27 billion in interest on the debts of all Canadian governments. It would be nice if we could print dollars with the pulp we grow here and ship those out, but nobody wants them. We have to either borrow from abroad to pay that $27 billion or we have to ship out some concrete goods.
It is very important to us to ship out that grain. If the cost of that in part is helping farmers get a price that will enable them to keep on producing those grains and oilseeds, well then it is in the interest of Canada to do it. It does not help the farmer so much, because they would quit producing if there was no sale. It certainly helps Canada as a whole to have that very important export commodity.
The Parliamentary Secretary to the Prime Minister I think was the one who said: "It's rather peculiar that the two opposition parties together have been supporting the government employees represented by the alliance and yet, at the same time, are now standing up and supporting the farmers".
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Over the years it has certainly been in the interest, whether it is the Liberals or Conservatives that are in power, of both of those parties to keep a wedge between these two groups; between organized labour on one hand and farmers on the other and yet they are natural allies.
Farmers certainly want union workers, organized workers, all workers to get a decent income so that they can keep on buying Canadian food if nothing else, and certainly the workers have no objection to farmers getting a decent return for the work they are doing.
I can draw on my own experience to give an example of that. I became Minister of Agriculture in September 1972. Prior to that, ever since the milk board was established, whenever the milk board announced that because of formula calculations or whatever there was going to be a price increase in fluid milk, there was an immediate drop in consumption, utilization if you like. People bought less fluid milk. It would then gradually climb up again. This happened regularly every time there was a price increase.
When I became Minister of Agriculture and the time came for an increase in price to be announced I announced it. I went to the news media and I said: "We need an increase of one cent or two cents a quart on the milk that the consumers are buying here in B.C. because the farmers need that extra money to pay their increase in costs." Not once during the 39 months that I was Minister of Agriculture was there ever a dip in consumption. The consumers, organized labour and everybody else, as long as they were convinced that it was the farmers who were getting it, felt that there was a real need and they were willing to support that and kept on drinking steadily increasing amounts of milk.
We are natural allies, labour and farmers, and yet it is to some people's advantage to try to drive this wedge between, to separate.
I see people smiling. They were not listening to my argument I suppose or were not paying too much attention to it.
Union workers do not have it all that easy. Although they were not able to negotiate any kind of a contract between the alliance and Treasury Board, even if they had a negotiated contract, they would know, in signing
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that contract, that in all likelihood inflation was going to keep on at the rate of some 6 per cent a year for the next three years. During part of that time they were to get no increase at all, part of that time there would be a 3 per cent increase, something like half the rate of the inflation increase, and in the third year the same thing. They are steadily losing ground.
As it is, they are probably going to be something like 14 per cent behind at the end of this period that was forced through the House by the government majority and there is nothing they can do about it. They know that in bargaining they do not know just how much it is going to cost them to live some one, two or three years down the road. They do not have it all that easy. They have to make their best estimates. They have to bargain for what they hope will be a contract that will enable them to keep their ground, to hold their position, although often they do not make it.
It is the same thing with organized workers in all fields. They are the only ones who say: "Yes, we are prepared to accept such and such a wage this year and next year and sometimes into the third year", without being assured by anyone that the cost of living is going to be controlled in any way at all, although the Governor of the Bank of Canada says he is trying to, as to how much of the increase they have negotiated is going to be eaten up simply by the increase in the cost of living.
There was a time when we did control it, Mr. Speaker, and I think you might remember this as well as some of the members in the House, simply by controlling the bank interest rates. Some of you will remember when it was fixed, when you knew exactly what it was going to cost you this year and 10 years down the road to borrow money from the bank. In those days there was very little, if any, inflation. It worked. We cannot do that now because of the banks and we do not want to do anything to the banks.
The unions do try to negotiate wage increases to hold their own. Once they have negotiated the unorganized people in all of those industries for all of those employers are given an increase which is always more than the organized workers get. They are getting a higher salary to start with and their percentage increases are usually higher again.

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Professionals seem to manage too. We hear of farmers going bankrupt. We hear of individuals having troubles.
We do not very often hear of professionals who are doing their job properly having that kind of trouble whether it is engineers, accountants or medical practitioners. They form organizations. They do not always set their rate of return, their pay for what they are doing, but certainly in the medical profession they do because in Canada we do have a Canadian medical plan, and they negotiate with governments to get a certain return for their labour. They know what it is going to be. They have trouble some time in the same way that organized labour does. They all get together and try to achieve some sort of unified approach, some way of trying to get a reasonable return for their labour, what they consider to be reasonable. Sometimes we are inclined to think that an increase that somebody else gets is unreasonably high, whereas the increase we ourselves get is always unreasonably low.
Nevertheless, they manage. They form their associations. They form their organizations, whatever you call them. In the case of trade union workers, they form trade unions. They all work in the same way.
The one major group in society that does not seem to have been able to make as much headway in that way is the farmers. In some areas it is particularly difficult for the farmers to try to do it. How can they negotiate in the same way that an employee working for the government among 100,000, 200,000, or 300,000 members of the alliance could? One employee would be in no position to go to his employer and try to negotiate some change in working conditions or some increase in pay or whatever.
I believe I am still on the 20-minute time allowance.
Farmers, when they try to plan their return from their work, their investment, everything they get, have not to be concerned only about the price they are going to get above the market return. TTiey have to worry about whether they are going to have anything to sell at all. They have to worry about the weather. They have to worry about pests. With animals they have to worry about diseases. They have to worry about whether they are going to be able to sell their products and, if so, if the price brings back a reasonable return.
It is much more complicated for farmers to run their business than it is for most other groups in society or
even most businesses. There are many more problems to be considered and many more things that are just totally unknown from one day to the next. They do not know when there will be an influx of grasshoppers to wipe out their crop. They would know a day ahead but not much more than that. Disease might strike as has happened when I was in the poultry business.
I keep layers for a period of some 20 years. For a short time during that 20 years they kept me, but most of the time I was keeping them. That was before marketing boards.
I can recall in 1951 getting a wholesale price of 87 cents a dozen for eggs. The price today is about 20 per cent more than that. I bought feed grain at $34 a ton 40 years ago. The price today has increased almost eightfold. The difference has been that the farmer has learned to become more productive: Technology.
When I went to university in 1949 I was told that the average egg producer in British Columbia, trying to make a living with a flock of less than 1,000 hens, was obviously not going to make it. He had to have 1,000 layers. That is 40 years ago. Today the figure would be at least 20 times that, probably more by now since I am out of touch.
It is just that difficult. The egg producers have learned to use technology, have learned to take advantage of the improvements in breeding as well, and they are able to do it. Although they are paying eight times as much for all of their input costs they are still able to get a reasonable return. The marketing board has made that possible. I said that 40 years ago the price I got for eggs was 87 cents a dozen. Six months later it was down to half of that. There was no ma rketing board. How could you plan under those circumstances? You could not. The marketing board has made it possible, and the resolution talks about supply management.
Someone asked what supply management means? It is very simple. It is knowing l ow much you want to produce in advance, whether you are going to produce it for your own people only in your own province, your own country or even in your own municipality, knowing how much is required in reasonable limits. Are you going to have any to export? Should there be my exports? Should there be some that would be manufactured into other products?
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It is adding all those quantities together and determining how much is going to be produced of eggs, for example, and then dividing that in some rational system among the egg producers. It works.
Society does not pay the cost of that. Consumers are paying but they are paying less than they would be without that kind of a system in effect, and the farmers are getting a decent break. That is supply management.
We cannot use it for grain but even with grain, as I said earlier, we are producing it for export because we need those export dollars. Canada as a whole needs them, not the farmer. The farmer does not get export dollars. He or she gets Canadian dollars, but Canada as a whole needs those export dollars, so we have to produce everything we can for export.
It pays, in part, the $27 interest charge annually. It is important that we do win this fight at Geneva. It is extremely important to our system of supply management. It works at the resolution stage for the dairy producers. It works for the feathered groups, the birds, and it could work for other products. There is no reason at all that we could not extend it.
I am sure if it is protected and saved it will be extended to other animal crops as well. I was talking about the hog producers who have an association in B.C. There is not a full marketing board set up, but at least they work together to try to improve the lot of everyone in the industry.
The cattle producers in B.C. have tried to arrive at some kind of a system. So far they have just fallen short of being able to come up with anything that is reasonable.
In not being able to accomplish this, as I said earlier, the farmers are behind every other group in society. Every other group organizes and no one criticizes them for organizing. Some people such as those at the Fraser Institute will say that marketing boards are costing consumers a lot of money.
That is not the case. They are paying a fair price for the product. The prices of eggs to consumers and fluid milk to consumers are not being subsidized at all. They are reasonable prices. Farmers are getting their return. The consumers are paying a fair price, although some want to take advantage of cross-border shopping. I appreciate that. Some want to earn their high incomes in
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Canada and then go across the border and buy cheaper products that are being produced at the cost of the people who are producing them. They are not getting a fair return.
In Canada we have been able to achieve a fair return without cost to society as a whole, without cost to the government. The cost is only to the people who are consuming the products. It is the one instance where we are not running a cheap food policy.
As Mr. Whelan and I used to say, we are running a reasonable policy. We are planning our production to suit the needs of the people in our community, and it is being paid for within the community.
We have to salvage this at GATT, and I wish I could feel confident that we will do so.


Ralph Ferguson: Mr. Speaker, it is more of a comment than a question.
I think it is only fair to point out to this House that 19 years ago, in early December, in an historic display of federal-provincial co-operation, 10 provincial ministers of agriculture across Canada and the federal minister, the hon. Eugene Whelan, signed the first national marketing agency into being.
I was one of the first charter members of the National Farm Products Marketing Council, the supervisory body over this legislation. The National Marketing Agency came from this, and those 10 ministers and the federal minister, with their foresight, unwavering support and dedication of purpose brought order out of chaos in the poultry industry in this country.
I point out that of those ministers, and of Mr. Whelan we all know his sincerity, purpose and dedication, there are two who stood out above all others. The two others were provincial ministers of agriculture. One was the late William Stewart of Ontario and the other was the hon. member from Nanaimo-Cowichan who just spoke in this House. I think members of this House should be aware of this.


David Stupich: Very briefly may I say that I believe it was Mr. Olson rather than Mr. Whelan who signed that very first agreement. I still have the pen in my possession. It is engraved on that date. It was before he left office as Minister of Agriculture, although he had been defeated in the general election preceding that.

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Victor Fredrich (Vic) Althouse: Mr. Speaker, I notice that the hon. member for Nanaimo-Cowichan has remarked that he has been in the political game and the agricultural policy field for a long time, having been the minister of agriculture in the province of British Columbia and now sitting in this Etouse. I notice that he has spent some time worrying, along with the rest of us, about the fate of article XI.
I am wondering given his experience why it is that he continues to be concerned, as I have to admit I am, but perhaps he can put it in words better than I can, about this government's commitment to a strengthened article XI given the fine words that we have heard from the government side this morning and this afternoon.


David Stupich: Mr. Speaker, we have had that assurance from the Prime Minister. I would remind you that Prime Minister is the same person who said, when he was running for the leadership of the Tory party, that getting into a free trade deal with the United States would be the worst thing that Canada could do or words to that effect.
I can recall that the Minister for International Trade was another person who, when running I believe for leader or at least some time around that date, gave us exactly the same reassurance that Canada could not afford to get into a free trade deal with the Americans. The Prime Minister and the current international trade minister were right then. When it suited their purposes, they very soon changed their minds totally and got us into this free trade deal with the Americans which has been so costly to us.
With that kind of a reputation and that kind of a record, can we believe those ministers when they say that they are going to do the best they can to salvage article XI?


Mr. Jerry Pickard (Essex-Kent):: Mr. Speaker, today we look very seriously at the GATT agreement, particularly the area that is affecting supply management, article XI of that agreement.
Many people are showing a great deal of concern for livelihood as Canadian producers if that clause is not strengthen'ed. We know that supply management in this country affects very strongly the dairy, poultry, egg and feather industry. I have to stop and think and ask myself
the question: Why is the business of agriculture not treated and looked upon in the same light as every other business?
It seems that we have heard supply management as a word to avoid. Many consumer groups have suggested supply management is not the best way to go. I have read editorials in major newspapers across this country which condemn somewhat supply management.


An hon. member:: They don't understand it.


Jerry Pickard: My colleague is very correct. I think they do not understand it clearly.
When I start to ask myself what supply management is, I relate back to the manufacturing industry. I relate to the auto industry or the clothing industry and I think to myself, these industries operate under very controlled supply management systems.
They market a product. They do research on sales. They produce products to match that market and match those sales.
When we start to look at it, what does that really achieve for an auto company? It knows how many cars it is going to produce in any one year. It knows how many workers it employs. It knows the cost of the raw materials going into the product. It knows what its energy costs are going to be to produce that product. It then hopes that it will anticipate proper sales. If those sales are not achieved we are in what we call a recession. That basically is the situation for almost every manufactured product in this country.
Let us take that scenario from the manufacturing industry and bring it into what we would call the agro-industry. When we stop and think about it farmers who are in supply management systems have done exactly what people in manufacturing areas have done. They have tried to define a market, done research on quantity of sales, set up production quotas to match that sale projection, and set up quotas so that they can be extremely efficient. Efficiency is the goal. Reasonable supply is the goal. When we stop and think about it, they really are doing what should be done in any business or any industry. They are looking at optimum values out of inputs, optimum value out of what is being put into that industry.
October 3, 1991

How is the consumer then affected by what they are doing? First of all I have to say that any consumer who realizes part of an industry is being developed to the point where it can control what goes in and what comes out, is sure to say we are going to have a very safe supply of food. We are not going to be in situations like my colleague referred to a while back this morning in which many countries of this world do not know where the next amount of food to the family is going.
We have to somewhat control our own destiny in agriculture in this country and supply management may be one of the better ways to do it, reliable supply of food.
Second, we have rules and regulations about safety in our country. By making sure that we have a very safe, adequate food supply, we do another service for that Canadian consumer. We make certain that safety and health are maintained at the highest level possible.
I hear stories about chicken barns in southern United States that are not cleaned for six months. Every chicken barn in the supply management system in Ontario, every time it goes through a series of production, is cleaned and changed. Antibiotics are not given to the chickens to prevent disease as much as they have to be in other climates and in other sections of the United States where safety is not the same concern.
I believe that quality control has come about because we have a reasonable marketing system in this country.
We heard the government side suggest this morning that there are a great deal of environmental concerns. It stated several countries of the world that overfertilize, that create all kinds of problems on the land by overfertilizing, overusing pesticides and herbicides which in the long run are going to destroy much of the agricultural land they are using.
With supply management systems we have found that Canadians are becoming most effective. They are becoming very environmentally sound and in our country today we use far less fertilizers than many regions of the world. We have become efficient to the optimum level. We have been able to look at those problems, do the proper research, and ensure efficiencies in the industry.
Because the farm community is operating in marketable systems and management systems that are produc-
Supply
ing a very solid agro-industry in Canada, probably the most stable part of Canadian agricultural industry, as consumers we should be quite ready to support it, realizing that it is to our benefit.
The previous speaker from the NDP suggested that Mr. Whelan, a colleague, a very good friend of mine who comes from southwestern Ontario and who was a former agriculture minister, stated that the strength of agriculture is really the strength of our country. We must realize that when we support the agro-industry, when we support the food industry, we are supporting the consumer in this country. We are supporting safety and all the good things we can think of within self-production.
We must remember that second to the manufacturing area, in particular the auto industry, agriculture is one of the largest industries in this country.
If I go on and start looking at who is operating management boards, I would see Canadians who are serving Canadians, Canadians who are buying products from other Canadians who produce food, Canadians who are buying pesticides, herbicides, using Canadian energy, paying Canadian taxes, paying financial institutions in this country, buying at every commercial enterprise in this country. They are Canadians who support Canadians. They are Canadians who pay taxes. They are Canadians who do what this country needs to survive, and that is generate and produce a tremendous amount of business in Canada.
I look on it from the government's point of view, this House's point of view, that if we do not protect the farm industry this country loses a tremendous amount of business which cannot be reclaimed.
When I look at article XI, at the protections we need, I realize that we must make certain that our programs are maintained very strongly.
I ask myself: Why is the United States not interested in defending our supply management system? I know that Canada is not going to have a major impact on people in the United States. Our supply management systems have been designed to serve the Canadian public. They have been designed to make certain that we as Canadians receive the benefits.

Many statements have been made today, but the most important part is that we must make certain agriculture survives.


Gregory Francis Thompson: Madam Speaker, I appreciate the overview the member has just given us on the supply management system.
I want to bring to his attention a comment made by Ralph Barrie, who is the National Farm Products Marketing Council chairman and someone who would hardly be considered an enemy of marketing boards.
One of the things that Mr. Barrie has brought to our attention is that he sees too much rigidity, too little flexibility, too much warring and too little partnership among producers, processors and consumers.
I believe many of us can see that, although we want to protect marketing boards, my question to the member is simply: in that context can he see any changes within the present structure of marketing boards to make them more responsive to present day needs of Canada?


Jerry Pickard: Madam Speaker, I believe that marketing boards are probably one of the most responsive groups in this country as far as the Canadian consumer goes. They look at their markets and their production, consider what production will best serve the Canadian public and make certain there is a stable, safe food supply for all Canadians.
Certainly forces are tearing at the marketing boards, but it is comments like those made in this House in the past by the former minister of external affairs, Mr. Crosbie, which hurt the boards. I need not restate those comments but they were anything but supportive of the agriculture community. I also make reference to the Canadian federalism and economic union, the report that was given by our Minister of Supply and Services which put very much on the line that there are impediments to the agricultural-


Madam Deputy Speaker:: Point of order, the hon. member for Carleton-Charlotte.


Gregory Francis Thompson: Point of order, Madam Speaker. I referred to comments made by Mr. Ralph Barrie, chairman of the National Farm Products Marketing Council, and he is not addressing-


Madam Deputy Speaker:: This is not a point of order; it is a dispute as to facts, and it is a question of debate, a dispute of the facts. The hon. member may want to continue after Question Period. It being 2 o'clock p.m. the House will now proceed to Statements by Members pursuant to Standing Order 31.


STATEMENTS PURSUANT TO S. O. 31
Mrs. Coline Campbell (South West Nova):: Madam Speaker, on one hand, the Minister of National Defence tells us that we have to cut back on excess infrastructure; but on the other hand he says the construction of a new $36 million naval reserve base will go ahead.
It is nonsense to consider new facilities at a time when existing bases are on the chopping block. CFB Cornwallis already has excellent facilities, is close to the sea, and is in a bilingual area. In fact, it started out as a naval training base in 1943 and has maintained a naval tradition since that time. It is large enough to handle the planned increase in our naval reserves in addition to the present English recruit training it already does.
Madam Speaker, there is no economic justification for a new base that will cost $36 million. Making CFB Cornwallis a naval reserve centre would not add one cent to the department's budget.


PROPERTY RIGHTS
Mr. Garth Turner (Halton-Peel):: Madam Speaker, since the government first proposed to restore the right to own property to Canadians there has been a great deal of debate as to exactly what this might mean.
Much of that debate has been misinformed. The detractors of property rights have somehow assumed that this right would supersede the rights of society.
Today's myth about property rights is that bestowing them on a corporation or a person would give that entity the right to pollute land. Absolutely not, Madam Speaker.
October 3, 1991

The individual's right to own property would not wipe out society's right, or Parliament's right to ensure that stiff environmental standards were met. Restoring the right to own property, a right Canadians always enjoyed before 1982, simply gives all of us a guarantee that if our land is taken from us, due process of law will ensure us just compensation. In a democracy the state can do nothing greater than ensuring its citizens have as many rights as possible, and restoring this right is a major contribution to democratic freedom in Canada.


BASEBALL
Mr. Sergio Marchi (York West):: Love those Toronto Blue Jays! Last night the Jays captured the American East Division and the hearts of all Canadians and this is just the beginning on the road to winning the World Series of baseball.
What a great way of liberating Canadians from the depression they feel over this Conservative government, of taking pride in the accomplishments of the team and of its fans, of providing a sense of unity and collective enthusiasm for Canadians at a time when these feelings are so desperately needed.
I know all members and Canadians will want to join me in wishing them every success as they prepare to battle baseball's best.
Madam Speaker, it would be a dream come true- think of it, after the Prime Minister and his government have hit so many fouls, committed so many errors and struck out at bat so many times with the Americans-for the Toronto Blue Jays to walk away with the national American pastime, the national championship of world baseball.
All together now:


Some hon. members:: Okay, Blue Jays, let's play ball!


AIDS AWARENESS WEEK
Mr. Bill Domm (Peterborough):: Madam Speaker, I would like to offer my full support to the Peterborough AIDS Resource Network known as PARN. During Peterborough's AIDS Awareness Week, October 7 to 13,1 am pleased that all levels of government are throwing their full support behind this event, as are hundreds of other community based organizations.
It has been brought to my attention that there are nine known cases of AIDS and 33 instances of HIV positive people in the Peterborough area. Three of these cases have been reported since May of this year.
Jonathan Mann of the Harvard International AIDS Center stated recently that the World Health Organization expects the number of people infected with HIV to triple to 30 million this decade and the number of AIDS cases stemming from infection by HIV is expected to grow from 1.5 million cases this year to 15 million cases by the year 2000.
As Peterborough's member of Parliament, I am proud to have in my riding an organization such as PAJIN.


EDUCATION
Mr. Rod Murphy (Churchill):: Madam Speaker, last week I was in Lac Brochet, an Indian reserve for which the federal government has responsibility. School children in Lac Brochet have been waiting since the early 1970s to have a permanent school built. They do not even have trailers, only makeshift classrooms with rotting roofs in a part of the country where winter temperatures often drop to 40 degrees or 50 degrees below.
Young children walk outside to go from one class to the next. Despite a letter I received from the former minister of Indian affairs stating that construction of a new school for Lac Brochet would start in 1991 or 1992, Lac Brochet has been told it must wait six more years, a total of almost 26 years, before a school will be built.
Madam Speaker, it is disgraceful that in this day and age the children of those educated in makeshift classrooms will themselves be forced to not only start school, but finish their education in these intolerable learning conditions.
I call on the Minister of Indian Affairs and Northern Development to commit the necessary funds immediately for the construction of a new school in Lac Brochet.

October 3, 1991


S. O. 31 BASEBALL
Ms. Barbara Greene (Don Valley North):: Madam Speaker, last night in a heart-stopping game at the SkyDome, the Toronto Blue Jays clinched the American League East title with a comeback 6-5 win over the California Angels in the bottom of the ninth inning.
The sellout crowd also clinched a major league season attendance record, with 4,001,526 fans. Fantastic. Love those Blue Jays! Okay, Blue Jays, let's play ball!


COUP IN HAITI
Hon. Andre Ouellet (Papineau-Saint-Michel):: Madam Speaker, the President of Haiti, Jean-Bertrand Aristide, went to the Organization of American States to plead with the international community to intervene as directly and quickly as possible in his country to restore democracy. It is obvious that the military officers who usurped power cannot continue to pretend that they democratically represent the Haitian people. All Canadians, especially Canadians and Quebecers of Haitian origin, are absolutely appalled by the events that have just taken place in that country.
I can only quote the words of a Canadian representative who said, "We do not need talk; we need positive, concrete action to bring the military back in line."


Madam Deputy Speaker:: The hon. member for Terrebonne has the floor.


WORLD SUMMIT FOR CHILDREN
Mr. Jean-Marc Robitaille (Terrebonne):: Madam Speaker, since last weekend, we have been celebrating the first anniversary of the World Summit for Children throughout Canada and the world. Events are now going on in 47 countries on the theme "keeping the promise' '. Religious, educational and community activities are held to remind the people and elected officials of the commitments made at the World Summit for Children and to ask leaders to carry out their promises.
Madam Speaker, Canada, which played a very active role in this historic event, co-chaired by our Prime
Minister, intends to fulfil the commitments it made at the Summit by pursuing various initiatives. These commitments were reiterated in the government's most recent Speech from the Throne.
Madam Speaker, I therefore ask all members of this House to support today all participants in the campaign to have all countries keep the promises made last year.


CORPORATIONS
Mr. John R. Rodriguez (Nickel Belt):: Madam Speaker, I am pleased to announce the beginning of a new weekly award. It is called the corporate carpetbagger award. This award recognizes corporations which in the context of the free trade agreement and Tory economic policies packed their bags and fled south from Canada.
Our nominees for this week are: Varity Corporation, which shuffled off from its headquarters in Brantford, Ontario to a $13.5 million mansion in Buffalo, New York. The cost to Canada is at least 3,000 jobs and $200 million worth of broken promises to the taxpayers.
Nominee number two is Black & Decker, which left 264 jobs when it moved its production in January 1991 from Trenton, Ontario to the United States.
Nominee number three is Colgate-Palmolive, which washed its hands of Canada and its 240 workers and moved its production to the United States in September
1991.
The envelope please. The winner is Varity Corporation. This week's corporate carpetbagger is Varity Corporation.


PUBLIC SERVICE
Mr. Felix Holtmann (Portage-Interlake):: Madam Speaker, I rise today to pay tribute to the men and women who are working at the Canada Employment Centre located in Portage la Prairie in the heart of Manitoba.

The 26 workers at the Portage CEC know the needs of the citizens of Portage. Not one of them went on strike. The needs of the citizens of Portage are their priority. How did the PSAC union view their commitment? The PSAC union has already placed the Portage local in trusteeship and is proceeding with decertification. Union bosses of PSAC care not for legitimate causes, they care only for themselves.
Have courage, Portage Canada Employment Centre workers. The union bosses might oppose you, but Canadians are on your side. Thank you for serving Portage la Prairie and for serving Canada.
The Order of Canada award goes to persons who have made a significant commitment to our nation. I believe that the Portage la Prairie CEC deserves the Order of Canada for their moral stand against the recent PSAC strike.


MONTREAL'S ECONOMY
Mr. Alfonso Gagliano (Saint-Leonard):: Madam Speaker, I have risen many times in this House to point out the deplorable state of the economy in the Montreal area.
For two years, the Conservative government has told the people of Montreal and the whole province that it was doing all it could to revive a declining economy.
Today, we learn that Quebec is not receiving its fair share of federal contracts. Quebec has 25 per cent of the Canadian population but receives only 18 percent of federal contracts. This injustice costs Quebec $350 million. It will not help regions like eastern Montreal, with 37 per cent jobless, and the Gaspe, with 27 per cent unemployed.
Madam Speaker, at a time when we are trying to keep this country together, it is important for the federal government to distribute its contracts fairly to all regions of the country.


COUP IN HAITI
Mr. Jean-Guy Guilbault (Drummond):: Madam Speaker, after 30 years of dictatorship under the Duvaliers, we
hailed the arrival of democratic government under Jean-Bertrand Aristide.
The recent coup in Haiti dismays the international community and we must ensure that democracy triumphs by making it possible for President Aristide to return to power as soon as possible.
Canada, which has long done much for Haiti, can play a leading role in giving back to the Haitian people the right to freedom and social justice. I trust that sending a delegation from the Organization of American States to convince the military to withdraw from power, the suspension of diplomatic relations and the reduction or even cessation of economic relations with that country will end the coup.
Madam Speaker, Canada must help restore democracy to Haiti.


SENIOR CITIZENS
Mrs. Shirley Maheu (Saint-Laurent-Cartierville):: Madam Speaker, I would like to inform the House of a resolution proposed by Gertrude Lacoste and adopted by the seniors' council of Montreal-Lac Saint-Louis, which I strongly endorse.
I would like to quote this resolution: "That the government and people of Canada send a resounding message in favour of national unity to the seniors of this country.
Older Canadians built our nation and we maintain a firm personal commitment to the principles and values on which our society is based, as well as to the mutual respect, understanding and reconciliation needed to help us overcome our present constitutional differences."


PUBLIC SERVICE
Mr. Ross Harvey (Edmonton East):: Madam Speaker, it will be hoped by all fair-minded Canadians that the government will be tolerant in its use of the back to work legislation provisions determining precisely when Public Service employees must be back on the job today.

October 3, 1991
Oral Questions
Due to the rather unique circumstances surrounding the bill's passage at 7.51 last night, notification of employees was not possible in many circumstances and there was great confusion over when the 12-hour limit in the bill would expire.
On behalf of all fair-minded Canadians, we would urge the government to be lenient in its enforcement of this provision.


GOVERNMENT CONTRACTS
Mr. Gilles Duceppe (Laurier-Sainte-Marie):: Madam Speaker, this morning we heard that Ottawa awards 50 per cent of its contracts to Ontario and 18 per cent to Quebec. For instance, we have the case of the 25 top research contracts at the Department of Supply and Services. Dalhousie University: 16 contracts worth $2 million; Ottawa: 34 contracts worth $2 million; Toronto: 317 contracts worth $35; York, 86 contracts worth $34 million; and none for universities in Quebec.
Tory members from Quebec who say they stand a better chance of making gains for Quebec by staying within the Conservative party are insulting the intelligence of Quebecers. They are there only for their own personal gain. The statistics are clear, Madam Speaker. It has become increasingly obvious that Quebec has no future within Canada. It has also become increasingly obvious that the Tory members from Quebec are not doing their job.


THE CONSTITUTION
M. Vincent Della Noce (Laval-Est):: Madam Speaker, since our Prime Minister, the Right Hon. Brian Mulro-ney, tabled in this House a document on the renewal of this country: Shaping Canada's future together, I have made it my business to ensure that every one of my constituents is informed of these proposals which are a starting point for the debate.
Once again, the Prime Minister has opened given Canadians new hope for the future, and at last this country will be at peace with its Constitution. I am not afraid of how Canadians will react. I am confident the
response will be constructive and that at the end of this national debate, we will have a better knowledge and a better understanding of this country.
I want to take this opportunity to express my appreciation for the excellent work done by one of the artisans of this attempt to save our country, a man I admire because he respects Quebec, the Right Hon. Joe Clark. I am happy to announce that on October 10, I will have the honour and the privilege of receiving the Right Hon. Joe Clark in Laval at a dinner organized in co-operation with the Laval Chamber of Commerce. At this dinner, Mr. Clark will speak on the Canadian Constitution and have an opportunity to dissipate any fears-


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



ORAL QUESTION PERIOD

['I wish to thank hon. members who took part in this tribute, and I would also like to offer, on my own behalf and on behalf of all members, our sincere condolences to the bereaved family.']
Ms. Sheila Copps (Hamilton East):: Mr. Speaker, my question is for the Deputy Prime Minister and Minister of Finance.
The government keeps saying that we are out of the recession, but on every front the economy is reeling: grain farmers, fishermen, Imperial Oil, Consumers Glass, small business and now 4,900 jobs at risk at de Havilland.
By tomorrow night American threats to our forest industry which employs almost one million Canadians could be felt throughout the nation.
Does the Prime Minister have a promise from the President that the United States will not take action again Canadian softwood lumber producers?


Hon. Don Mazankowski (Deputy Prime Minister and Minister of Finance):: Mr. Speaker, as the hon. member knows, the MOU expires at midnight tonight.
We have served notice in the appropriate fashion as is our right under the provisions of the MOU. Obviously the U.S. will be contemplating whatever action it may or may not wish to take.

I would suspect that we will have an indication as to whether or not it will take any action with regard to this later on this afternoon, at which time we can respond in an appropriate fashion.


Sheila Maureen Copps: Mr. Speaker, my supplementary is for the same minister. This government's economic policies have already crushed Montreal's economy. Now the Canadian forest industry is being crushed by high interest rates. Softwood exporters are being crushed and the workers have the right to know whether or not the Prime Minister has obtained a formal guarantee from the President of the United States that there will be no punitive tariff on softwood exports. Did the Prime Minister obtain a commitment from the President of the United States on that or not?


Donald Frank Mazankowski: Mr. Speaker, I indicated to the hon. member the process which is contemplated and is followed under the provisions of the MOU. Whatever action is taken or contemplated would obviously have to be consistent with international trade law and we will have to wait and see if in fact there is any action contemplated by the United States administration. If action is taken, the Government of Canada will respond as necessary and appropriate.
In regard to her allegation on interest rates, Mr. Speaker, interest rates have declined by 560 basis points, that is 5.6 per cent since the high of May last year. I am sure the hon. member would find it pleasing to note that the bank rate dropped another 13 basis points today.


Sheila Maureen Copps: Mr. Speaker, that is obviously too little, too late, for more than a million Canadians who are trying to find work.


Some hon. members:: Hear, hear.


Sheila Maureen Copps: Six years ago the Prime Minister said this in the House about the great deal on de Havilland:
We want to make the best deal for the Canadian taxpayer, secure
those jobs and that technology in Toronto and that is what we have
done.
I would like to ask the Deputy Prime Minister what he has to say today to those 4,900 workers who have been
Oral Questions
sold out by the policies and the trade actions of this government.


Donald Frank Mazankowski: Mr. Speaker, it is really unfortunate that the hon. member cannot stand good news. We have had four consecutive months of growth in the economy after a recession that was more severe than we expected. I remind the hon. member that Canada is not the only country that has experienced a setback in economic growth.
Canada is emerging from a recession, recovery is on the way, we have had a growth rate of 4.9 per cent in the second quarter, we expect growth to continue in a moderate way, we want that growth to be sustainable, and we want it to be achieved with price stability.
That is our goal, Mr. Speaker, and we are on the right track.


Mr. Reginald Belair (Cochrane-Superior):: Mr. Speaker, I too have a question for the Deputy Prime Minister. Yesterday, the Minister for International Trade told this House, about the lift of the surtax on softwood lumber, and I quote:
It is our judgement that there will not be a 301.
We heard that the Americans are threatening to retaliate today or tomorrow. Here is my question: what contingency plan does the government have in place to prevent yet another disaster from crippling the Canadian lumber industry?


Donald Frank Mazankowski: Mr. Speaker, if the hon. member has evidence that the United States is going to take action under 301 perhaps he would like to produce that evidence for the House.


Réginald Bélair: Mr. Speaker, I was asking the Deputy Prime Minister if the government had a contingency plan in order to counter what the Americans may to do tomorrow afternoon.
During the free trade debate this government told Canadians time and time again that we would get secure access to the U.S. market. The memorandum of understanding on softwood lumber violates the spirit of the free trade agreement.

October 3, 1991
Oral Questions
Again my question is for the Deputy Prime Minister. Did the Prime Minister get a guarantee from President Bush that his administration would respect the spirit of the free trade agreement and would not take punitive action so as to not totally destroy the Canadian lumber industry.


Donald Frank Mazankowski: Mr. Speaker, the hon. member asks a hypothetical question. His first question asked what the government would do now that the United States imposed an action under 301. I asked him if the United States was imposing an action under 301 to give us the evidence. Hon. members on that side of the House want the United States to engage in imposing a countervail or a 301. We chose not to.
I should also remind the hon. member that under the free trade agreement we do have secure access, and furthermore we have a binational dispute solving mechanism that puts Canada on a fair and equal footing with its largest trading partner.



Mr. Jim Fulton (Skeena):: Mr. Speaker, my question is for the Minister of the Environment who yesterday fudged the issue of cabinet approval for U.S. nuclear submarine activity in Dixon Entrance which is the richest fishing grounds in Canada.
Another cabinet document stamped secret says: "A Governor in Council decision is soon going to be announced regarding the transit of nuclear submarines through Dixon Entrance." In this same document the minister is warned by the director general of operations that what the cabinet is doing is illegal.
Would the minister explain why he appears to be participating in an activity which his own director general has found could be illegal?


Hon. Jean J. Charest (Minister of the Environment):: Mr. Speaker, this is the second day in a row that the hon. member has risen in his place and alleged things out of documents that we have not seen.
In fairness, if he expects us to answer questions on the basis of what these documents are alleged to contain or not contain, he should at least have the courtesy of showing them to us.


James Ross Fulton: A supplementary question, Mr. Speaker. These are his documents produced by his department and I assume he reads his mail.
This same secret cabinet document says: "The issuance of another Order in Council could draw undue attention to the use of this technique to avoid the application of the EARP."
Now that Canadians are aware that cabinet is teetering on the brink of breaking the law on behalf of the United States military, will the minister trigger a public review of this project or is he under orders not to do so?


Jean J. Charest: Mr. Speaker, what the member is alluding to is under discussion presently between the two levels of government and, as far as I know, no announcement has been made. These are ongoing discussions between both levels of government.
As far as the environmental part is concerned, I would like to remind the hon. member that the ships and the type of activity he is referring to has been going on in our waters for well over 20 years as far as I know. There is a track record in terms of that type of activity.
When the final decision is made we will assume our environmental responsibilities as required by the different laws or policies that we have.
I think in fairness, if the hon. member is going to allege the contents of documents-and I do not want to play games with this and neither should he-he should at least show us the documents before he rises in his place in the House of Commons to ask us questions about it.


James Ross Fulton: Mr. Speaker, a final supplementary. I am perfectly prepared to table these documents today. What this government does not seem-


Mr. Dick:: You know you're not allowed to do that.


An hon. member:: We don't want it now.


James Ross Fulton: Oh, you do not want it now, eh?


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


James Ross Fulton: A supplementary question, Mr. Speaker. This government does not seem to have learned anything from Kemano, anything from the Oldman, anything from Rafferty-Alameda. What the people of British Columbia want is a public environmental assessment of nuclear submarine activity in Dixon Entrance. That is only fair and just.
My final supplementary is for the Minister of National Defence who met with Miles Richardson, the president of the Council of the Haida Nation, Chief Michael Nicoll from Old Masset and myself this summer on the Queen Charlotte Islands.
I would like to have the minister explain to this House why, according to this same document, his department is demanding that there be no public review of nuclear submarine activity in B.C. waters on the grounds of national security?
I believe this is a cover-up simply for the accident record of these subs which since 1983, have had 12 groundings, 50 collisions, 113 fires, 14 onboard explosions and 31 crew suicides. Is that not what you are covering up?


Hon. Marcel Masse (Minister of National Defence):: Mr. Speaker, obviously, this is a current issue for public opinion. The Canadian government will decide on the basis of its legislation and in keeping with Canadian traditions, Mr. Speaker.


SMALL BUSINESS
Hon. Herb Gray (Windsor West):: Mr. Speaker, my question is for the Minister of Finance.
Today the Canadian Federation of Independent Business released a survey which showed that more than one-third of small businesses in Ontario will be considering moving their operations to the United States, putting at risk more than 500,000 jobs.
The federation blamed the Ontario NDP budget, but it also said that small business in Ontario, and I quote: "was already under siege from a high dollar, high interest rates, the GST and the recession".
Oral Questions
Will the minister remove this siege he has placed on small business in Ontario? Will he reverse these harmful Conservative policies right now?


Donald Frank Mazankowski: Mr. Speaker, perhaps I can help the hon. member in correcting his interpretation of the news release I have in my hand which says that: "Startling results from a current survey reveal that more than one-third of the small business sector in Ontario, 36 per cent, report that they are considering moving all or part of their operations out of the province, thereby putting at risk, 500,000 jobs". It does not say a thing about the federal policy. It is a reference to the policies of the NDP government in the province of Ontario.


Herbert Eser (Herb) Gray: Mr. Speaker, I invite the Minister of Finance to look at page 2 of the release that says: "The CFIB's Vice President and Chief Economist, Catherine Swift, said that 88 per cent of those small business owners who were considering moving all or some of their operations from the province, cite the United States as a preferred place to relocate". That is an exact quote.
I repeat to the Minister of Finance. Catherine Swift has said that small business people are planning to move because they are already under siege, and I quote, "from a high dollar, high interest rates, the GST and a recession".
I ask again, why does the Minister of Finance want to carry out policies which will precipitate this potential horror story for jobs and business in Ontario and, therefore, all of Canada?


Donald Frank Mazankowski: Mr. Speaker, perhaps I might ask the hon. member a similar question. Why is this same phenomenon not taking place in the provinces of British Columbia or Alberta? The reason is right in here, and I quote: "It is very clear that the Ontario government's policies and its over-all disdain for economic logic and business reality have become the major concern of small business", said Catherine Swift.


DE HAVILLAND
Mr. Jim Peterson (Willowdale):: Mr. Speaker, my question is for the Acting Prime Minister.

Oral Questions
Yesterday, the minister for industry washed his hands of responsibility for de Havilland, metro Toronto's largest industrial employer.
Like it or not, this government is responsible for the fate of de Havilland. This was the government that gave de Havilland away to Boeing along with $60 million and did not even get any job or production guarantees.
De Havilland's 4,900 workers have a right to know from this government if their jobs are secure. Will this government change its mind? Will it commit itself to the future of de Havilland?


Hon. William C. Winegard (Minister for Science):: Mr. Speaker, it is interesting that the hon. member would not recall the exact state of de Havilland when the sale to Boeing took place. There are a lot more people working at Boeing now than there was working at de Havilland then.
As far as recent events are concerned, of course we are not happy with what has happened to the deal. It would have been better if the deal had gone through. Everybody in this House agrees with that. This is a problem that Boeing itself is going to have to resolve. We stand ready, as we always have done throughout all the negotiations, to help Boeing in any way we can in whatever deal it would like to bring off with other people.


James Scott (Jim) Peterson: Mr. Speaker, the minister is telling the House that the government is not going to take a lead in ensuring the future of Canada's leading aircraft producer.
Surely the decision of the European Community did not take this government by surprise. The European action was launched four months ago. The government has had four months to contemplate alternative action.
What de Havilland and its 4,900 workers need today is certainty. It needs an answer today. I ask the minister again. Will the government commit today to ensuring the future of de Havilland as a leading aircraft producer?


William C. Winegard: Mr. Speaker, it is well known that other companies have had an interest in Boeing.
Those other companies were not able to move as long as this particular deal was on the table. If this deal is off the table, those other companies may now come back into the picture to resolve the situation. We have always stood ready to try to help in those negotiations.


Mr. Brian L. Gardiner (Prince George-Bulkley Valley):: Mr. Speaker, my question is directed to the Deputy Prime Minister.
When the softwood lumber tariff memorandum of understanding was brought in by this government in December 1986 the Social Credit government and the Prime Minister said the deal was great for Canada and B.C.
Their enthusiasm for this sell-out of our forest industry cost thousands of jobs, particularly in B.C., Quebec and northern Ontario. Given reports of possible retaliation by the United States, can the Deputy Prime Minister assure this House that unlike the last time, the government will not cave in and sell out to the U.S. again?


Donald Frank Mazankowski: Mr. Speaker, I think the hon. member is aware that the MOU was not considered to be a permanent fixture. It was put in place to ensure that appropriate offsetting measures could be instituted and most important, so that any countervail or duty would remain in Canada.
I think it was a logical move and a logical step in the right direction. We now sense that conditions are normal, that trading patterns should be resumed on a normal trading process and we think the time for the MOU to expire has come.
We believe we are on solid ground, and whatever action the United States may or may not take, we can respond in an appropriate fashion based upon international trade laws.


Brian L. Gardiner: Mr. Speaker, when this government sold out the Canadian forest industry workers, it codified the softwood lumber tariff and the Softwood Lumber Products Act. This legislation gave the government the authority to impose the tariff.
My question is for the minister. Will he repeal this legislation so that Canadians can be assured that this government will not reimpose a tariff? Will he table in this House the list of questions that the U.S. posed to this government and tell us what the answers were?
October 3, 1991


Donald Frank Mazankowski: Mr. Speaker, I am not sure whether I grasp the hon. member's rationale.
If we had not agreed to an MOU, we would have seen $400 million flowing out of the country. As it turned out, under the auspices of the MOU, the $400 million remained in Canada in the hands of the provinces.
Perhaps, Mr. Speaker, he might want to check with his friend, Jack Munroe, who not only believes that we did the right thing at the time we put the MOU in place, but he also believes that we have done the right thing in terminating the MOU. He may want to check with him after Question Period.


OIL AND GAS INDUSTRY
Mr. David Kilgour (Edmonton Southeast):: Mr. Speaker, my question is for the Minister of Energy, Mines and Resources.
He will know that there is approximately $60 billion invested in Canada's oil and gas industry. In calendar 1991 the entire industry expects to net about $200 million which would be about a .003 per cent return on invested capital.
He will know that the number of Canadians working in the industry has dropped from 140,000 in 1985 to about
80,000	today. What basis of substantive hope can he offer a vital Canadian industry?


Hon. Jake Epp (Minister of Energy, Mines and Resources):: Mr. Speaker, the hon. member raises points that I discussed with representatives of the Canadian Petroleum Association as recently as two days ago. I have had similar discussions with other members in the oil and gas industry.
One or two points become very clear when I speak to them. They understand the cyclical nature of the industry. They also know very well they do not want the intervention that once marked the federal government's oil and gas policy. They definitely do not want to see artificial incentives brought back into the industry which, while it might give us some activity in the short term, does not help us in the market in the long term.
Oral Questions


David Kilgour: Mr. Speaker, my supplementary question is for the Minister of Finance. The minister will know-he has been told day in and day out here-of the economic grief sweeping Canada because of the high dollar.
The western oil and gas industry, the coal and forestry sectors have indicated recently that our 88 cent and 89 cent dollar is wreaking havoc on them. He also knows that the Bank of Canada has intervened to keep the dollar up recently.
Will the minister tell us why his government is not prepared to persuade the bank to bring the dollar down.


Donald Frank Mazankowski: Mr. Speaker, if the hon. member is advocating another Liberal national energy program, I would like to see what he has to propose because it is obvious that is where he is coming from.


An hon. member:: That is still their policy over there.


Donald Frank Mazankowski: With respect to his comments regarding the intervention of the Bank of Canada, I think what he is referring to is what was reported in the press today. The action of the Bank of Canada is not unusual. This is quite normal practice. The Bank of Canada intervenes when it is necessary to ensure that there is a stable market and not erratic fluctuations.
It should also be noted that the Bank of Canada did not intervene to stop the decline in interest rates, it merely tried to moderate the decline so that we can maintain a steady decline of interest rates on a sustainable basis. I think that is what the hon. member is in favour of and that is certainly what we are in favour of on this side of the House.


FISHERIES
Hon. William Rompkey (Labrador):: Mr. Speaker, my question is for the Minister of Fisheries and Oceans. The Mayor of Black Tickle in Labrador has confirmed that fishermen in that community are without food-without food-in Canada in 1991 because they cannot qualify for welfare. They cannot qualify for unemployment insurance.

October 3, 1991
Oral Questions
Through no fault of their own, they are in dire straits. Why is this government refusing to take the window of opportunity? Why is it not responding to the extreme urgency of the need of fishermen along the Labrador coast? Why is it not announcing an aid program today?


John Carnell Crosbie: Mr. Speaker, the hon. member knows that this matter has been worked on now for some weeks. An announcement is imminent.
I agree with him that the situation in Labrador is simply deplorable, that the fishery there was a complete failure. Of course the hon. member knows and understands that the fishermen in Labrador as well as along much of the rest of the northeast coast received ice compensation until well into August. There will be an announcement shortly on what other efforts are going to be announced in order to assist them now and during the winter. I hope it will not be very much longer.


Bill Rompkey: Mr. Speaker, I know the minister understands the situation, and I know there has been compensation and I give him credit for that. So let me tell his cabinet colleagues that the reality in Labrador is that you cannot do anything in November. Winter is coming on. If you do not have a work program in Labrador now, you cannot help those people. Time is of the essence and aid delayed is aid denied. You have to announce a program for Labrador this week. Will you do it?


John Carnell Crosbie: Mr. Speaker, the hon. member and myself understand the situation perfectly. I hope it will become clearer to many others.


CANADIAN BROADCASTING CORPORATION
Rodney Edward Murphy: My question is for the Minister of Communications. The minister is no doubt aware of reports that further drastic cutbacks to the CBC may be coming. English and French FM stereo networks, regional suppertime hour news programs and the virtual shutdown of CBOT Ottawa and CBWT Winnipeg could be the next victims. In the case of Winnipeg, CBWT is the only CBC station for all of Manitoba.
Will the minister guarantee that these services will not be cut and specifically that there will continue to be full regional services in Winnipeg and Ottawa?


Henry Perrin Beatty: Mr. Speaker, as the hon. member and all members of the House will know, the CBC has an arm's length relationship with the government. It is the board of directors of the CBC which has the responsibility for planning the activities of the CBC.
Hon. members opposite would be the first ones to complain if the government were to do away with that arm's length relationship.
What is important however is to recognize the fact that the CBC has taken no decisions at this point with regard to how it should be doing its planning for the future. With regard to the budget, the government continues to look at the situation, to see what sort of a situation it is facing. We are working together with it.
The important thing, Mr. Speaker, in responding to the hon. gentleman, is to stress the fact that there is an arm's length relationship. It is the responsibility of the CBC, and not of the government, to take decisions with regard to precisely where operations will exist.


Rodney Edward Murphy: Mr. Speaker, the minister does not reassure us very much. First of all, he says that it is an arm's length relationship and then he says that we are working close together with the CBC. In addition to that he says that the CBC has not made a decision yet.
I remind the minister that in the case of Windsor and Calgary the decisions were made effective that day. Will the minister at least guarantee the people of Winnipeg and Ottawa that there will be prior consultation with the employees and their communities before there are any cutbacks?


Henry Perrin Beatty: Mr. Speaker, the hon. member raises apocalyptic scenarios. He is asking first of all that I reach into the CBC and give instructions to it as to what it should be doing in such and such in a particular location.
If I were to do that the very first member of this House who would be on his feet to object would be the hon. gentleman opposite. He would be saying I would be involving myself politically in the internal affairs of an arm's length corporation of Canada.
October 3, 1991

What I did indicate to the hon. gentleman is that we are working with the board and with the management of the CBC to address its financial concerns. I want to continue to give that assurance to the House and to the Canadian people, but we will be doing so on the basis of the arm's length relationship.


AIRLINES
Garth Turner: Mr. Speaker, I have a question for the Minister of Transport and it concerns Worldways Canada Ltd., now known as WorldStar. The airline ceased operations a year ago. An application to restart the company was filed with the National Transportation Agency in May of this year. More than 1,000 jobs are at stake. Many of these Worldways employees are my constituents.
I ask the minister on their behalf, what is the status of the application of Worldways to the NTA and when can these people find out what the future holds for them?


Hon. Jean Corbeil (Minister of Transport):: Mr. Speaker, I can assure the hon. member that we are concerned about the future of Worldways and its employees.
As required by the regulation, the restructuring plan was submitted to the NTA which ruled that it did not meet the contents of the Canadian requirements for ownership. WorldStar was instructed to reapply if it had new facts. A reapplication was made and again it did not meet the requirements of NTA.
If there are new facts that can be brought before the NTA to meet the Canadian requirement, the NTA will revise the matter.


RAILWAYS
Mr. Russell MacLellan (Cape Breton-The Sydneys):: Mr. Speaker, my question is for the Minister of Transport. CN has decided that it is going to privatize the rail line between Sydney and Truro, Nova Scotia, because it is just too far away from its comfortable offices. It is making money so it cannot be abandoned. It found that if
Oral Questions
it refused to market the line and actually discourage business it still made money. So now it is to be privatized.
I want to ask the minister to stop this injustice. When is he going to tell CN not to sell this railroad?


Jean Corbeil: Mr. Speaker, as I have mentioned many times in this House, CN was given a mandate to be as commercially profitable as possible. In the discharge of its obligations it is at the present time examining the possibility of selling that railroad. No decision has been made. CN is examining the possibility. If a proper bidder is found it will require that the line be maintained to properly service the customers on that line.


Russell Gregoire MacLellan: Mr. Speaker, when a Crown corporation is making money Canadians have the right to receive service from that Crown corporation. It is their Crown corporation and it is making money.
Why is the minister not listening to legitimate concerns of eastern Nova Scotians and why will he not tell CN not to sell that railroad?


Jean Corbeil: Mr. Speaker, simply because I think that the most important thing is that the people and the clients of the railroad in that area are served to the best level possible. The question is not who will do it, but how will it be done in the best interests of the customers.


ORDER IN COUNCIL APPOINTMENTS
Mr. George S. Baker (Gander-Grand Falls):: Mr. Speaker, I want to ask the President of the Treasury Board to explain to the House, as he has explained to me, why procedures are being followed this year, as they were followed last year, to give bonuses to Order in Council appointments. Last year they came about in the month of December.
Why are these procedures being followed this year, the same as last year, in view of the hon. minister's statement in the House last week? And for what period of time do these bonuses apply?

Oral Questions


Gilles Loiselle: Now the facts. Of course bonuses are a complex issue and I am not surprised-


Some hon. members:: Oh, oh.


Gilles Loiselle: I will have to threaten the hon. member with removing him from my Christmas card list if he keeps asking this question.
I will be very clear. It is very simple. At the end of a particular year unionized employees get a salary. Managers and some Crown corporation officers get a salary and they get a bonus. At budget time we decided that one year would be a zero year; unionized employees will get zero salary increases; managers will get zero salary increases, and managers will get zero bonus increases.


George Baker: In other words, Mr. Speaker, over 1,000 Order in Council appointments that make an average of over $100,000 a year in salary will again qualify for Christmas bonuses this year, some up to 25 per cent of their annual salaries.
I want to ask the government how it, in all good conscience, can sit in a cabinet meeting just before Christmas, after telling Canadians to tighten their belts, and approve these massive bonuses to highly paid people? Yes, fat cats, there really is a Santa Claus.


Gilles Loiselle: I would like to remind the hon. member that the performance pay was put in place by the Liberal government.


Some hon. members:: Oh, oh.


Gilles Loiselle: What was done was for the managers. Fifteen per cent of the wage budget was taken off and instead of going gradually in an increasing scale, we topped it off and we said we would evaluate them. Some will get zero, some may get 10. To my knowledge, nobody ever got 25. It is an outside committee which passes these judgments and usually the cabinet sits down and cuts it anyway.


CROSS-BORDER SHOPPING
Mr. Bill Blaikie (Winnipeg TVanscona):: Mr. Speaker, my question is for the Minister of National Revenue and it pertains to the matter of cross-border shopping.
In the past when the minister has been asked in this House about the effect of the GST on cross-border
shopping, he has stuck to the increase in the number of trips that Canadians have been making across the border, which have increased in and of themselves, but has never gone to the heart of the matter which is how much more Canadians are spending when they make those trips.
Statistics Canada collects that kind of information. The information we have is that those figures show there has been a dramatic increase in the actual spending by Canadians, something in the neighbourhood of 57 per cent.
I want to ask the minister if he has seen those figures and, if so, why does he continue to talk only about trips and not tell Canadians the whole story about how the GST has affected cross-border shopping.


Hon. Otto Jelinek (Minister of National Revenue):: Mr. Speaker, I am surprised at that question coming from an hon. member who knows better. Statistics Canada hands out all the facts, all the statistics and we on this side of the House, as opposed to some members on the opposite side, support those statistics 100 per cent and talk about them.
The last time this issue came up in the House, Statistics Canada made it very clear that the introduction of the GST played a minor role, a very minor role, in the increase of cross-border shopping, both in terms of trips as well as in terms of dollars.
We consider cross-border shopping as a very serious problem. That is why we are working with the provinces, with the private sector, with labour, with the Retail Council of Canada, to move in the right direction that would make Canadians more competitive and allow Canadians to shop in Canada rather than south of the border.


William Alexander (Bill) Blaikie: Mr. Speaker, if the minister is so confident in the Statistics Canada data, would he undertake to instruct Statistics Canada, or to have the appropriate minister do so, to publish all the figures so that we can compare oranges and oranges, and apples and apples, first quarter with first quarter, last quarter with last quarter, spending with spending, trips with trips, and all the things we need to know in order to make a true measure of what the GST is doing to cross-border shopping instead of having the minister get up and selectively cite statistics with respect to trips and not with respect to over-all spending.
October 3, 1991


Otto John Jelinek: Mr. Speaker, that question is an insult to Statistics Canada which is internationally recognized as one of the top statistical organizations in the world.
You should stand up on your feet and apologize to Statistics Canada-


Some hon. members:: Oh, oh.


THE CONSTITUTION
Hon. Alan Redway (Don Valley East):: Mr. Speaker, my question is for the Acting Minister responsible for Constitutional Affairs. The government has proposed that the federal government get out of all its existing and future housing programs and turn the matter over exclusively to the provinces.
Is it the government's intention also to provide the provinces with additional taxing powers or alternatively additional federal funding in order to allow them to continue on the national housing programs within their own jurisdictions?


Hon. Kim Campbell (Minister of Justice and Attorney General of Canada):: Mr. Speaker, as the hon. member will know, the proposals for constitutional reform have as one of their main themes the rationalization of the operations of different levels of government to ensure that services are provided by those levels of government closest to those being served and at the present time most of the housing services themselves are being provided by provincial and local governments.
If the proposal that is put forward is part of this large package of rebalancing is accepted by the committee, that would be followed by negotiations with the provinces to determine the appropriate modalities of devolution.


CANADIAN BROADCASTING CORPORATION
Hon. Jean Lapierre (Shefford):: Mr. Speaker, my question is for the Minister of Communications. In the
Oral Questions
past, the minister vehemently denounced federal propaganda practices in the late 1970s and early 1980s. Yet today he is in power, and we are witnessing the CBC recycling old directives from 1978 with respect to the constitutional debate. They are now asking journalists and media people to apply a double standard, that is, on one hand, to emphasize the benefits of the status quo, and on the other, to denounce the costs and consequences of constitutional reform.
For the sake of freedom of information and so, the real Canada can show through, is the minister prepared to immediately withdraw that directive reminiscent of the witch hunts of the past?


Henry Perrin Beatty: Mr. Speaker, the CBC has one responsibility and it is to ensure that its reports are completely accurate and that its comments made are fair and impartial. That is their mandate and that is what they do.


Jean-C. Lapierre: Mr. Speaker, I have a supplementary question. If the minister has bothered to read the Corporation's directives, he will know that they are applying a double standard: on the one hand, the reports must emphasize the advantages of federalism and, on the other, they talk about the costs and drawbacks of constitutional reform. Can the minister, who should have a sense of fairness, not see that there is a double standard, that it is not right, and that it is not in accordance with the criteria that he just defined himself? Should he ask the CBC to do away with this procedure that is totally unacceptable in the 1990s?


Henry Perrin Beatty: Mr. Speaker, the responsibility of the CBC, whether the French language arm or the English language arm, is to ensure fair and accurate coverage of the news and of public affairs. That is its duty. It is one it discharges with distinction. Throughout the whole of the constitutional debate that is the direction in which it will be going. It is obligated under the Broadcasting Act to do precisely that.

October 3, 1991
Point of Order
The difference between the hon. member and those of us on this side is that we want to see improvements made to Canada. He would like to see Canada destroyed.


PUBLIC SERVICE
Don Boudria: Mr. Speaker, my question is for the President of the Treasury Board, the minister responsible for the zero per cent increase for Public Service Alliance members.
I want to ask him very clearly: Will the presidents of the CNR, VIA Rail, Canada Post and other big-wigs get a Christmas bonus this Christmas?


Gilles Loiselle: Mr. Speaker, these chairmen will be treated as everybody else. They will get no salary increase for 1991-92 and no bonus at all for 1991-92.


Don Boudria: Mr. Speaker, the minister has not answered the question.

Will the chairmen of Crown corporations receive a bonus in December? I am not saying: "Are they going to get one for this year?" Will they get extra money or not? That is what we want to know!


Gilles Loiselle: Mr. Speaker, I would like to be very clear on this. The chairmen of corporations, like the union members, will get exactly the same treatment, even more so in that they will have no salary increase and not one penny in bonuses for the 1991-92.


PRESENCE IN THE GALLERY
Mr. Speaker:: I draw the attention of hon. members to the presence in the gallery of His Excellency Geza Jeszenszky, Minister of Foreign Affairs of the Republic of Hungary.


BUSINESS OF THE HOUSE
Mr. David Dingwall (Cape Breton-East Richmond):: Madam Speaker, I again ask the regular House business
question. Could the minister indicate what the business will be for tomorrow, Monday, Tuesday, and the remaining part of next week?


Harvie Andre: Madam Speaker, today is an opposition day. On Friday, October 4, it is our intention to call Bill C-30 regarding mental disorder for completion at second reading and Bill C-27 having to do with foreign missions for completion at all stages.
On Monday, October 7, it is our intention to call Bill C-3 regarding the Real Property Act for completion at second reading and Bill C-18, income tax technical amendments, also for completion at second reading.
Discussions will continue along usual channels to arrange business for Tuesday.
It seems at this point that we might call Bill C-33, the Coastal Trade Act, for second reading on Tuesday, Bill C-23, the Wheat Board Act, for completion at second reading and, Bill C-16, the Agriculture Marketing Board Act, for completion at second reading. We will be in the usual discussions for the business for the rest of next week.


POINT OF ORDER
David Charles Dingwall: Madam Speaker, will the government House leader share with members of the House if there is any movement with regard to the subject matter of conflict of interest in terms of what the government intends to do in terms of an all-party committee which may be struck in order to further examine ways in which this particular institution, as well as the Upper House, may be monitored pursuant to the conflict of interest guidelines?


Harvie Andre: Madam Speaker, I have put proposals to the opposition parties as well as to the other place for the establishment of a joint committee of this House that would take the subject matter of a conflict of interest bill that was before the House in the previous session, as well as taking it upon itself to examine how this issue was handled in other jurisdictions such as the United Kingdom and other nations with political systems similar to ours.

It would be my hope that this committee could look at that and come back with recommendations that would be tantamount to a bill that we could put before the House and deal with this matter, hopefully with some degree of finality.
The government does not come to it with a fixed position in mind other than recognition that we are all members of Parliament and members of the other place in a situation in which we must satisfy our publics that we recognize the requirement that conflict of interest be dealt with and in a formal, legal fashion. Beyond that we would await the advice of that committee and except for keeping the natural obligation of having the Department of Justice examine and write the bill so that it stands up to the legal requirements of our system, it would be my hope that in essence the House of Commons and the other place in committee would provide the fundamentals of a conflict of interest position that we could all agree to.


David Charles Dingwall: Madam Speaker, would the government House leader just perhaps elaborate. I am not asking for a fixed commitment, but in the discussions of this particular subject matter, assuming that a bill would be tabled by the committee itself on the subject matter, would he explore the real prospects of perhaps having on that particular piece of legislation an opportunity for members to exercise their rights and remove the party lines in terms of our whips and have a free vote on the subject matter on the floor of the House?


Harvie Andre: Madam Speaker, clearly the question of party lines only comes to play when you are talking about an initiative from the government and very specifically this initiative would be from Parliament. This question of how it is handled is something I certainly will look at in discussion and I do not come to it from a perspective of assuming that it is going to be a government bill, quite the opposite.
This issue affects all of us equally on both sides of the House as members of Parliament and we have to, somewhere between the two extremes, assure that there is absolutely never a conflict of interest nor apparent
Point of Order
conflict of interest, and somebody has even suggested nowadays the standard is a possible apparent conflict of interest or, on the other hand, a situation in which it is recognized that conflicts of interest are a part of life, but that they should be open and obvious so that people can make their judgments as to whether that conflict of interest has caused the member to act in an inappropriate fashion.
Between those two extremes perhaps we can find some accommodation that will meet the standards of Canadian citizens and enable this House both to operate and to ensure that we can attract in future quality men and women who are needed to ensure a successful Parliament.


David Charles Dingwall: I have one final question for the government House leader. I wish to thank him for his intervention. I wish to offer to him that we would be favourably disposed in terms of the way in which he has outlined a process in terms of the conflict of interest. My colleagues from Ottawa-Vanier, Kingston and the Islands and our critic from Glengarry-Prescott-Russell would certainly want to be very involved in that particular process.
I am wondering, since I have got the government House leader's attention, if he has given any thought to the prospects of the committee which will review the subject matter including members who are Independent members. I know that he cannot include them all. We would have members from the three main parties, but there are also Independent members in this House.
I think to be fair to Independent members, wherever they come from, whatever region of the country they come from, we might want to try to involve them in the process as well so that there will be a complete legitimacy of Parliament working on a subject matter which has profound consequential effects on each and every member in this House, and likewise in the other House.
Would the government House leader entertain that possibility?

October 3, 1991
Point of Order


Harvie Andre: I have no difficulty with that suggestion whatsoever. If this is going to be successful, it will provide for input from everyone who has an interest in the subject in this House.
My only qualifier is as one balances off representation and so on one gets to a size of committee which becomes unworkable. As Parkinson said, once a committee passes 20 it effectively goes into the control of the executive of the committee. To make sure it is a group that can work I would like to have the committee small enough so that it can be effective and that everyone who has an interest in it has an opportunity to participate. I am sure we can work out the modalities of that.


William Alexander (Bill) Blaikie: Madam Speaker, the questions from the House leader of the Official Opposition are welcome on this topic. I enter the debate only to say that I seemed to hear the House leader saying that in order for something to be considered as the object of a free vote, it would have to be seen as not being part of the government's agenda but coming from Parliament.
If I recall correctly, the conflict of interest legislation and the proposal to do something about the lingering problem of conflict of interest was in the throne speech and was therefore part of the government's agenda and part of the platform on which the government seeks to curry support among the Canadian people.
I ask the government House leader to consider, because I know he has commissioned a paper in this regard with respect to free votes, that it is not only those things which are seen as coming from Parliament, somehow independent of the government, but also maybe some things which come from the government that may be subject to a free vote of the government's own members. That, it seems to me, is the direction in which the debate about free votes is going.
It is not just a question of private members or things that do not originate with the government but about giving government backbenchers some freedom with respect to a wider range of government proposals, which up until now at least conflict of interest legislation has been.


Harvie Andre: Madam Speaker, this is an interesting subject and perhaps we should set aside a day some time to explore it further.
My interest in this regard in the comments I made to the House leader of the Liberal Party was to reflect merely the fact that for conflict of interest legislation to be effective, if that is what results on the recommendations of the committee, it should reflect the views of the House and not the views of the cabinet.
The problem we have dealing with the notion that the hon. member talks about is our adversarial system. Any time a government proposes something, the opposition feels obliged constitutionally to oppose. May I humbly suggest I welcome the day when the New Democratic Party and the Liberal Party participate and take responsibility for some of the positive actions that occur and not simply be in the position of opposing everything.
For example, the hon. member's party and others have been suggesting we should be providing help to farmers, fishermen, and those in need. I agree and I look forward to the day when they stand up in the House and say they agree to raising taxes to fund these activities.
That will be the kind of co-operation from both sides of the House that will make this institution work in a way that the public of Canada would appreciate.


An hon. member:: A point of order, Madam Speaker.


Madam Deputy Speaker:: I will recognize the hon. member in a second. I would just suggest to members that we are getting into a debate which is not on orders of the day.
I am the servant of the House, but I wanted to remind members of the time and that some members have asked for the floor to render a tribute to a departed parliamentarian.


William Alexander (Bill) Blaikie: Madam Speaker, I am sorry that what could have been a useful preliminary discussion about free votes was turned into a sort of partisan opportunity by the House leader.
The fact is, and he knows this well because he has been here longer than I, that there have been occasions in which governments, opposition and third parties have agreed on things. He knows also that this discussion about free votes is one that we want to have precisely so that we can get out of the adversarial system which he laments and yet which he just employed in order to avoid answering the question I put to him.
October 3, 1991


Harvie Andre: With due respect, I did not avoid answering the question at all. The hon. member talked about why I think it is appropriate to proceed in this manner for conflict of interest and why I think a free vote situation is appropriate.
I am trying to suggest that if the government sat down, wrote up a conflict of interest bill and brought it to the House constitutionally the opposition becomes opposed to it. That is the way we operate. That does not mean at the end of the day that it is not supported.
The role of the opposition is to criticize, point out weaknesses, et cetera. I am saying that on this issue in particular perhaps we could work together since we are all in it together and at the end of the day we could vote in that fashion.
You are right. I have a paper coming on free votes. We are committed to proceeding in that direction as a government and more will be happening in that regard.
I also have to say that free votes is not at the root of excesses in our adversarial system. There are other things and we need to look at those as well.


David Charles Dingwall: Madam Speaker, I have a last comment. I believe my colleague from the New Democratic Party has said it well. I have attempted to say as well as to the government House leader that there is a disposition now, as we viewed from the comments of my colleague from the New Democratic Party, to sit down and discuss the process, the intricacies of this particular matter, in terms of conflict of interest for members of Parliament.
I think it would be a good beginning. I want to thank hon. members to my left, as well as the government House leader, for entertaining some of the suggestions that we have made. We look forward to further discussions later this week, perhaps, and early next week so that we can consummate something on the subject matter before too long.


THE LATE SENATOR HAZEN ROBERT ARGUE
Leonard J. Gustafson: Madam Speaker, I would like to rise and pay respects to the late Senator Hazen Argue.
Tributes
Senator Argue served the area that I served as a member of Parliament and I remember with a great deal of appreciation, especially his kindness to me as a new member of Parliament.
Senator Argue served his country for 43 years. That is a long time. He was always a defender of the farmers. If I may add a personal note, I recall being chairman of the task force on drought and shaking in my boots facing 1,500 farmers.
Senator Argue rose and he really broke the ice. I will never forget what he said. He said: "The experts told you farmers to buy more land. The experts told you to buy more machinery. The government told you this and it was my government that did it". The farmers just broke up.
He was always very kind to me as a new member of Parliament. He served the people well. He defended his constituency, and to Jean and the family we send our sympathy and the respect of the government for his long years of service to Canada.


André Ouellet: Madam Speaker, on behalf of the Liberal Party of Canada, I rise to join in the tribute to the late Senator Hazen Argue and extend, on behalf of my colleagues and myself, our deepest sympathies to his wife Jean and members of the Argue family.
It is true, as the hon. member just said, that Senator Argue had a remarkable sense of humour and a very warm welcome for anyone he met. He served bravely and courageously the people of his province and Canada and helped promote a better understanding of the legitimate aspirations of Western Canada among people from various regions of the country.
I had the privilege of serving with him in Cabinet under the Right Hon. Pierre Elliott Trudeau. On several occasions I had the opportunity to hear and appreciate the strong stand Senator Argue took in Cabinet on behalf of Western farmers and the people of Western Canada in general.

October 3, 1991
Tributes
Just recently, with Senator Fairbairn I had the pleasure of paying him a last visit in hospital while travelling in Saskatchewan. I will treasure the memory of this visit because, even on his hospital bed, his death bed, he kept showing his love of life, a remarkable joie de vivre. He had remained very clear-headed, in fact I noticed that he was still monitoring what was going on here, on Parliament Hill.
That is why, I am sure that, had Senator Argue been here today when the hon. member for Lambton- Middlesex put a motion concerning Canadian farmers, he would have risen with those of us who beg the government to do something to rescue the Canadian agriculture and protect Canadian farmers in the GATT negotiations in Geneva.
I think, Madam Speaker, that we are not about to forget Senator Argue and his contribution to Canadian life and politics.


Victor Fredrich (Vic) Althouse: Madam Speaker, I rise on behalf of the New Democratic Party to speak in remembrance of Hazen Robert Argue, a man who was born, raised and educated in Saskatchewan.
He was a graduate of the University of Saskatchewan in agriculture and farmed at Ormiston. He was first elected in 1945 at age 24 to represent the CCF in the riding of Wood Mountain which later became Assiniboia. At the time he was the youngest MP ever elected.
I first met Minister Argue, known as "Blazin Hazen" to his constituents, at a district meeting of the Farmers' Union in southern Saskatchewan in the late 1950s. I was there with Roy Atkinson, a young vice-president of the union who later became president of the NFU.
That part of Saskatchewan was suffering from a drought and infestation of grasshoppers. Those topics dominated the meeting and one of the people who came and spoke very eloquently was Hazen Argue, the local member of Parliament.
Mr. Atkinson and I were joined at lunch by Mr. Argue. Conversation turned to agricultural policy and the future of agriculture, not the dismal immediate future but the
long-term hope for farming and farmers and things that could be done.
A long time later, in the summer of 1984, I remembered again my first conversation with Mr. Argue. My last long conversation was in the summer of 1984 when the same three people met by chance in the airport in Toronto. We were all awaiting flights out to the west and we got talking. Mr. Argue had just been let go from cabinet. Our conversation again turned to the shortterm dismal future of agriculture. It was a drought year again in southern Saskatchewan. The same long-term hope and unreasonable optimism that pervades Saskatchewan farmers' conversations came out. I remember just before he got on the plane, the last thing he said was: "Well, I hate to be kicked out of cabinet, I hate to lose the job, but it gives me a chance to go home and watch the grandkids grow". It is to those grandkids and their fathers and mothers, the two daughters and the son and their spouses, and especially to Jean that our thoughts go today.


Mr. Jesse Flis (Parkdale-High Park):: Madam Speaker, I too would like to add my personal sympathy to Jean Argue and her immediate family and her extended family.
When I first came to Ottawa in 1979, whether it was in caucus or in other meetings, Senator Hazen Argue was one of the first people to come, extend his hand and welcome the new members, and I will never forget that.
I saw the greatness of the man when we were passing the western transportation bill, known as the Crow bill. We spent a lot of time in Saskatchewan. I see my colleague nodding his head across the aisle here. We travelled through the small towns and talked to individual farmers and big agricultural organizations. Everyone knew Hazen Argue and everyone had something positive to say about Hazen Argue.
I know that he will go down in history as making his mark on the growth of this country. My personal contact with him remained even though I was defeated. Senator Hazen Argue still kept in touch. He still had a special interest in members who were newly elected here and he was always there to offer a guiding hand.
October 3, 1991

Again I extend my sympathy to Jean and her immediate and extended family. He will be missed and he certainly made his mark on this country.


Madam Deputy Speaker:: I wish to thank hon. members who took part in this tribute, and I would also like to offer, on my own behalf and on behalf of all members, our sincere condolences to the bereaved family.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Ferguson (p. 3200).
Madam Deputy Speaker:: I will recognize the hon. member, but I had to check whether the member who had the floor at 2 p.m. was still in the House.
Resuming debate, for ten minutes. The hon. member for Papineau-Saint-Michel.


André Ouellet: Madam Speaker, in the 1970s it was Liberal governments who created marketing boards to protect Canadian farmers and, at the same time, ensure that Canadian consumers would have access to an abundant supply of high quality farm products at competitive prices.
It is important to recall that one of the greatest achievements of the Liberal government was the creation in 1975 of the Canadian Dairy Commission. Some
16,000	Quebec farmers annually receive a guaranteed income under this program.
Over the years, the program was refined and improved, and it became so popular among farmers that the Tories decided to renew the program for five years. Unfortunately, the program's continued existence may be at risk as a result of the current GATT talks. The government has not only failed to defend the interests of Canadian farmers, it is also, as was explained this
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morning by the hon. member for Lambton-Middlesex, trying to hide the truth.
The Prime Minister and his Minister of Agriculture are looking the other way, while the Minister for International Trade is selling out Canadian and Quebec farmers in Geneva.
Quebec farmers who put their trust in the Prime Minister must realize he could not care less what happens to them. I think this is quite clear if we consider the question put by my colleague, the hon. member for Gatineau-la Lievre, on September 24. The hon. member asked the Prime Minister, and I quote:
Given that the survival of agriculture, especially for joint plants in Quebec such as the one for the dairy industry, is based on the principle that production costs will be taken into account and farmers will have a reasonable income, can the minister or the Prime Minister assure farmers that this essential criterion will always be maintained for our farmers?
The Prime Minister's answer was, and I quote:
Mr. Speaker, if my hon. friend wants to know whether there is anything in the proposals tabled this morning to -
He stopped, and then went on.
If the question is whether we will maintain our previous programs in spite of the document tabled this morning, the answer is yes.
The Prime Minister was referring to the tabling of the document on constitutional reform. I realize the Prime Minister may be totally absorbed by the constitutional question, but that is hardly a reason for assuming the hon. member for Gatineau-La Lievre was talking about the constitutional proposals, not the GATT talks, and answering that the constitutional proposals had no connection with the problems of Quebec's dairy farmers.
To help the Prime Minister, I prompted: "It isn't about this morning's document, it's about the GATT talks". Then he made a quick recovery and said, at page 2633 of Hansard and I quote:
My hon. friend from Papineau, who is also an expert on agriculture -
-those were the Prime Minister's very words-
- tells me that this issue is mainly up to GATT That being so, I would be pleased to answer a supplementary.
So my colleague from Gatineau-La Lievre did ask a supplementary question:
The Quebec farmers' union, the UPA, is very concerned about their future because the Minister of Agriculture is always talking about productivity without considering production costs. That concerns them and they would like to have an answer about it.

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Here is the Prime Minister's answer:
Mr. Speaker, productivity applies to everyone. But mentioning productivity in no way undermines the ability of the UPA or its members to meet the competition that they face now. Nothing was said or done to keep farmers in Quebec or elsewhere from maintaining their production.
The Canadian government-
-this is the gem-
-will try to find new markets for them.
Very clearly, the Prime Minister did not know what he was talking about then. Very clearly, he misled the hon. member for Gatineau-La Lievre, although unintentionally, I think, by telling him about something completely unrelated to the GATT negotiations because, as my colleague from Lambton-Middlesex said this morning:

"If the government supports Article XI, which allows countries to limit imports when they have a system of production designed to meet only domestic needs, why are they now concerned with finding new markets for dairy farmers? The answer is simple". And I quote my colleague: "I do not believe they intend to support article XI at the GATT. Why else would the dairy farmers need the government to find them new markets?"

Obviously, as my colleague rightly says, the government has absolutely no intention of protecting farmers and supporting Article XI; otherwise, the Prime Minister would not make an issue of finding new markets for milk producers. And come to think of it, where will we sell the wheat, butter and all the dairy products that are already in such oversupply? One of my colleagues said, "Eastern Europe". They already produce those things over there; they do not need our Canadian production. Europe has a massive surplus of these products. I will remind the hon. member that we already imported dairy products from Poland. So we cannot send them over there; they can send us some here. We must product the markets that we have in this country.
What is serious-and I conclude with this-is not just that dairy farmers are threatened by the GATT negotiations in Geneva, but also everyone at the egg, chicken
and turkey marketing boards. If the government does not fulfil its responsibilities and does not properly defend the interests of its farmers in Canada and Quebec, the whole future of agriculture is in danger. That is why I am pleased to speak in this debate and to support the motion of my colleague from Lambton-Middlesex.


Mrs. Lise Bourgault (Parliamentary Secretary to Minister of Supply and Services):: Mr. Speaker, I missed the beginning of the speech of the hon. member for Papi-neau-Saint-Michel who, on top of being an expert on agriculture, as the Prime Minister mentioned, is the Liberal critic for External Affairs.
Could the hon. member for Papineau-Saint-Michel tell me how he perceives the European countries which, as regards the GATT, are more inclined to support an American proposal on tariffication? Tariffication, is a new buzz word in the GATT negotiations.
Also, is the hon. member for Papineau-Saint-Michel aware that Canada, as a member of the GATT, finds himself in a rather lonely position in his fight with the farmers, with the agriculture ministers, and with the president of the UPA, who is presently in Europe? We reassured him. We want to keep the supply management system for milk, eggs, poultry and other products. However, as a central state and a member of the GATT, we must obviously also think of the grain producers and other goods that are not subject to quotas.
Is the hon. member aware of that? What would he do, today, if he was taking the place of the Minister of Agriculture in Geneva, at the GATT, as regards this concept of tariffication? Would he be rather in agreement or in total disagreement with the European countries who want to support the American position concerning tariffication rather than article XI of the GATT?


André Ouellet: Mr. Speaker, obviously once again the US government is dictating its will to the government of Canada. This time, they would want us to believe that, while the European countries might be prepared to make some concessions, they will do so at the expense of their own national farming industry. I can assure the hon. member that the French, German and Italian farmers will have their governments stand up for them.
October 3, 1991

The question right now is who is defending who? The government of Canada, instead of always obeying the orders of the US government and be its puppet, should stand up at the GATT negotiations in Geneva and protect the interests of Quebec farmers and all Canadian farmers.
In response to the question of the hon. member, this tariff approach could work in Europe, but not at all for the Quebec dairy producers. Once the Quebec farming industry will have gone belly up, it will be too late. The hon. member and her Prime Minister will have failed to fulfil their responsibilities.


Lise Bourgault: Mr. Speaker, the hon. member for Papineau-Saint-Michel, is a smart politician indeed and very good at dodging the question. I will ask him again. The Canadian government is facing problems with the GATT, we must live up to our commitments regarding contingency but, at the same time, it is our duty, as a government, to protect non-contingency production. In that context, when we seek to strengthen Article XI of the GATT agreement, we come up against new difficulties relating to the export of non-contingency products.
We have made it clear, Mr. Speaker -and I might add that our jobs are at stake, as someone mentioned earlier-that we will protect the Canadian farming industry. There is no doubt about that! But would the hon. member tell me how he can reconcile the two when the European countries would prefer instituting a tariff policy rather than strengthening Article XI of the GATT, which is our choice as a country?


André Ouellet: Mr. Speaker, it is obvious that at the current GATT talks the Canadian delegation is now on the sidelines.
The talks took the turn they did because today, interests other than the interests of Canadian farmers have prevailed. I want to repeat to the hon. member that even if she proceeded to name all the reasons the Europeans have given, this would do nothing to advance the cause or the interests of Canadian farmers.
I would prefer to see her over there, explaining what has to be done to protect Canadian and Quebec farmers, than listen to her here in the House, trying to convince us that the Europeans are right about their new tarifica-tion. Go tell them Quebec farmers won't buy it!
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Gaby Larrivée: Mr. Speaker, I cannot believe my ears!
Mr. Speaker, I welcome this opportunity to speak in the debate today on the opposition motion that the government "must immediately provide Canadian producers, operating within these supply management sectors, firm assurances that it is seeking and will continue to seek the strengthening and clarification of article XI of the General Agreement on Tariffs and Trade".
First of all, I feel I must comment on what was said by the hon. member for Papineau-Saint-Michel. I was not impressed when he told us that the interests of Quebecers were not safe with the Prime Minister, especially when we consider how safe they were when the hon. member's party was in power.
We won't get into that today, but just the same, the record was not impressive.
Mr. Speaker, what my hon. friend opposite fails to understand and may not realize, is that the whole strategy and the proposals tabled at the GATT talks were developed by the agricultural sector and the government. The proposals were approved and the offer made to GATT, on that basis. I think it is wrong to say that the interests of our farmers and producers are not being defended as they should be, since our producers were involved in preparing these proposals.
Mr. Speaker, perhaps it would be useful to comment on what the government has done in the past few years to cope with current and future challenges.
I agree, Canadian agriculture is facing unprecedented demands, but it is also being offered a wealth of new opportunities. Never before has there been such tremendous pressure for change and adjustment. In response to these pressures, in 1989 the federal government, in co-operation with the provinces and the private sector, launched the most exhaustive study of agro-food policies and programs ever undertaken in the history of Canadian agriculture. We have worked very hard on clarifying and revising the rules of international trade under GATT.
Canadian agriculture must maintain its position at the forefront of this sector, both nationally and internationally. The changing tastes of consumers, advancing technology, the globalization of markets and environmental concerns made this review necessary.

October 3, 1991
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We did all we could to avoid a dialogue of the deaf and set up a vast nationwide consultation process to include governments, farmers, everyone involved in the food chain, and of course consumers and other interest groups in setting the framework for a national agricultural policy. We therefore asked all participants to put their ideas on the table, to put their differences on hold, to say what they thought and to listen to what the others had to say. They were then asked to see the process through with us. And I wish to assure you that we have no intention of going back on our commitments.
Thus the federal and provincial agriculture ministers agreed in July on a series of decisive measures for the future of the agri-food sector at their annual meeting in Kananaskis, Alberta. These changes, from second-generation supply management systems to increased industry participation in agriculture policy development, will begin the next stage of the Canadian agri-food policy review.
The systems now in place are viable and can be effective, but they will have to change to improve. They must be more market-sensitive, more independent and more responsive to regional diversity. Supply-managed sectors should design and operate their system while respecting the environment. Supply management policies must help and not hinder the development over time of a more competitive sector.
Canada's international trade policies must continue to allow us to operate our supply management systems effectively. With this in mind, Mr. Speaker, the Canadian government took concrete action by tabling a proposal in Geneva in March 1990 to strengthen and clarify article XI of the General Agreement on Tariffs and Trade, GATT.
We wanted, among other things, to define precisely what effective government control of supplies meant, to determine the products eligible for import quotas on the basis of their manufacture, in whole or in part, from a fresh product whose domestic supply is controlled, to clarify the administration of import quotas and to impose export limits on products subject to supply management when import quotas apply to the same products.
Last October, after consultation and receiving support from the industry and provincial governments, the Canadian negotiators tabled legal wording to be included in our GATT proposal.
Well, Mr. Speaker, as the Minister of State for Agriculture, Mr. Blais, told the press a few days ago, Canada has not changed its position on article XI of GATT one iota. The government has promised to defend vigorously the Canadian supply management systems and we remain just as determined to do so.
In fact, Mr. Blais is presently in Geneva. Earlier, our colleague was blaming us for discussing this motion in the House instead of being in Geneva to negotiate. Well, we have our negotiators and our Minister of State, Mr. Blais, is presently in Geneva where he will meet, among others, the GATT Director General and Chairman responsible for negotiations on agriculture, Mr. Dunkel, to discuss those negotiations.
The minister will then go to Paris where he will meet Mr. Jacques Proulx, the president of the Union des producteurs agricoles du Quebec, to discuss the state of the GATT negotiations.
Also, the Minister of Agriculture, Mr. McKnight, met yesterday with the European Community commissioner for agriculture and rural development, Mr. Ray Mac-Sharry. They discussed the multilateral trade negotiations, including the desastrous effects of the subsidy war on the Canadian agri-food industry. The minister also stated Canada's firm intention to seek re-enforcement and clarification of article XI of the GATT, as well as ensuring a fair implementation of the GATT rules on agricultural exchanges.
As you can see, Mr. Speaker, this government does not intend to leave anything to chance, nor does it sit on its laurels or rely on others to protect the interests of Canadians abroad.
In the document on Canadian federalism and economic union that was made public last week, the Government of Canada proposes that article 121 be updated in order to facilitate the mobility of people, of capital money, of services and of goods within Canada, by prohibiting the federal government and the provinces from passing legislation or implementing programs or practices that would create obstacles or restrict such a mobility.

Some think that the marketing boards are threatened by such proposals, since those boards would be a barrier restricting the circulation of goods and services. I want to emphasize here that the marketing boards serve other purposes regarding the foreign markets. Any amendment to the clause dealing with the common market must not be detrimental to the equalization programs or regional development, nor to any program classified as an exception by Parliament in the national interest. In short, we are saying that the national interest will prevail and that we are intent on using that clause in the case of marketing boards. It is also in that perspective that the Castonguay-Dobbie Committee was set up by the government. This committee will study every aspect of the Canadian economy so as to ensure that, after adequate consultations, the decisions made will be based on the national interest.
To demonstrate its support for marketing boards, the government intends to give second reading to Bill C-16, which seeks to amend the Agricultural Products Marketing Act. These amendments would give provincial marketing boards and other agencies additional powers to enable them to have a more concerted approach and thus improve the marketing of their products on interprovincial and international markets.
We know how important the supply management system is to the dairy co-ops in Canada. Its implementation enabled us to stabilize the economy of that sector and to ensure an adequate supply of high quality dairy products to Canadian consumers, at affordable and stable prices.
I am almost finished, Mr. Speaker. As regards the Canadian dairy policy, this government took, in 1985, the necessary measures and will keep working in the same fashion.
I am convinced that, through consultations, we will find ways of making more competitive those sectors where the supply is regulated. There is a vast consensus on the need to change the system. Working groups on the dairy and poultry policies, as well as independent studies made by consultants, have all come to that conclusion.
So, Mr. Speaker, allow me, in the few minutes that I have left, to simply reassure the Canadian producers and in particular the producers in my riding of Joliette, about the firm intention of my government to continue in the direction that it has been following for at least two years,
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to cooperate with the agricultural industry and all the stake holders in order to set policies and strengthen our external policies-the proposal is being examined today at the GATT-, and to ensure that our producers will be adequately protected within our contry, while at the same time having access to external markets.
It is very important to protect them-we know that, we see it and we know what the Western producers are presently going through because of the war between the United States and the Europeans, in particular the French-and it is precisely in order to improve their fate that we are working, at the GATT, to create a much more lucrative and appealing market.We must put an end to this impossible and very harmful price war throughout the world, while at the same time protect our marketing boards and our producers.
Even though we hear all kinds of comments to the contrary here, I believe that our producers-in fact we had the opportunity this week to meet several of them- are aware of the initiatives taken by Canada and they support these initiatives. There is no doubt that we will continue to work towards that goal, and we hope to get our position accepted in this country and at the GATT. Our position is very well balanced and would guarantee brighter days to our agricultural producers.


Lise Bourgault: Mr. Speaker, I want to compliment my colleague. Since his time ran out or so he thought, I would like this House, the Canadian people watching us and above all the farm producers in our ridings to hear him again.
The member for Joliette comes from a most prosperous farm area where tobacco growers have experienced certain problems in recent years. However, I am sure that the vitality of the growers will see them through these hard times. Could the hon. member tell us how producers, at the local farm board level, are reacting to this new threat regarding GATT tariffs? What Canada wants instead, what we want as a nation, Mr. Speaker, is the strengthening and clarification of article XI of the GATT agreement to prevent dumping of foodstuffs in Canada. We want to put and end to the unstable economy of our producers who have worked so hard to build a system for themselves these last few years. They work very hard, but at least they are guaranteed an income at the end of the year.

October 3, 1991
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I would like the hon. member to tell us what we have been done these last two years to try and convince the European producers, the Americans, in fact all GATT members, that Canada has interesting policies which they should take as models and establish marketing boards in their countries and strengthen article XI of the GATT agreement.


Gaby Larrivée: Mr. Speaker, I thank my colleague for her very interesting question. I think that we are going through a period of major changes, and our farmers' concern is quite legitimate. We have long felt the threat to our marketing boards. We recall the last election campaign when our farmers told us that they were very worried. Free trade with the Americans was the issue, but in fact the real threat was related to article XI of GATT
Since then, we have worked and they know our position very well. We intend to spare no effort to protect a system that has served us well and should continue to do so. As I said not so long ago, we developed our whole strategy together, to make them more confident and especially to inform them of everything we intended to do. Together we developed the strategy to work out a proposal which, as I said, is very well balanced and should reassure them to some extent.
Of course, we are negotiating as one country among hundreds; we cannot expect our whole policy to be accepted and we are very well aware of the war now going on between the Europeans and the United States. We know that it is not easy. We spared no effort, we worked together. It was just mentioned that Mr. Blais was to meet Mr. Proulx in France tomorrow, I believe. We are working together. I think that in this way our farmers should be reassured and that we will see it through together. And I find it somewhat regrettable today that it has become a partisan debate in which it is suggested that the government is not doing everything required to protect farmers properly.
I think that instead of getting into a partisan debate, we should-I think that this is not the time for division. This would be the time for all parties to join with farmers and everyone concerned in agriculture to defend our interests. It is not a war between farmers and the government; it is an extremely important process for the future of our agriculture with foreign countries. I think
that if all parliamentarians and the farming community join together, we will be in an even stronger position to have our position adopted. It is very well balanced and could ensure prosperity for Canadian agriculture.


Mr. John Harvard (Winnipeg St. James):: Mr. Speaker, this is an extremely timely and important debate. This motion is necessary because agricultural producers are losing confidence in this government.
What does the motion seek? What it seeks is very important. It seeks assurances from this government that it will do everything possible to support article XI of the GATT, that it will seek clarification of that article, and that it will seek strengthening of that article.
The motion seeks those things from the government because the very livelihood and the very future of supply management, the very future of dairy and poultry producers in this country, depend on the outcome of the GATT negotiations.
Let the record make it absolutely clear that if Canada caves in on article XI we will lose our dairy producers. We will lose our poultry producers. We will lose our egg producers. It is as simple as that. It will be the beginning of the end of an absolutely thriving and very successful industry in this country, an industry that will measure up against any other industry anywhere else in the entire world.
But the people who are in these industries are worried. They are sick of the possible prospect of the government caving in. That is why they are so worried and they have every reason in the world to be worried. Because, after all, we have to remember who we have over there in government. We have a Tory ideology that really does not believe in supply and management, a Tory ideology at the very base of all this that does not believe in orderly marketing.
I remind you, Mr. Speaker, and you will know this very well, that there was a resolution before the Progressive Conservative convention in the city of Toronto just this past summer. It was a resolution seeking support from supply and management and it went down to defeat. It went down to defeat. Little wonder the poultry producers and the dairy producers in this country are worried sick.

I do not have to remind you of how this government sold out Canada in the trade negotiations with the United States, the famous free trade negotiations. It sold us out. It sold us out. There is a lot of reason to believe that it will cave in again.
Oh, I know government members have given us assurances. They have given us assurances they are going to do their best. They are going to work hard and do everything to defend and strengthen article XI. But can we believe them? The Americans want to get their hands on article XI and want to destroy article XI. They want our market. Unfortunately, ever since we had this Prime Minister going back to 1984, every time the White House says "jump", the Prime Minister asks: "How high?" Whatever George wants, George gets.
How did we get the GST? How did the GST get its name, the GST? George said to, George said to. That is how the goods and services tax got its name.
We have a supply management system that is working extremely well. But if we were to cut out article XI and go for this tariffication system proposed by the Americans, the fact of the matter is our producers could not compete. There is no way they could compete.
Our producers have input costs that are much higher than those of their counterparts across the line in the United States. I just have to mention things like fuel, labour and things like that. The input costs are much higher on this side of the border.
Let there be no mistake about it. We have to preserve the industry. We have to preserve it. It is rather ironic that we are expressing concern for the industry at this particular time, because dairy and poultry are the most successful segments of our entire agricultural industry. They are. They are the most productive. They are the most stable.
Here we have on the other side of agriculture, grains and oilseeds in a lot of trouble, in a lot of trouble. We are trying to get help for them. Yet on this side we have dairy and poultry doing very well, thank you, and it is possible that the government may cave in and give the industry away. Does that make sense? I do not think it does.
This industry is extremely productive. My colleague from Lambton-Middlesex, who probably has as much
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expertise on this subject as anyone in the country, was pointing out this morning-and I want to point out again-that since 1971 the productivity in the dairy industry per cow has gone up 73 per cent compared to only 46 per cent in the United States and 3.5 per cent in the European community.
You can say the same thing for poultry. There is better egg production and they certainly have a better handle on disease control than their counterparts in the United States, a lot better. This is a productive and efficient industry. It is an industry that gives consumers quality, quality.
My colleague from Broadview-Greenwood was asking this morning in some of his remarks, and rightly so, what is in this for the consumer. He has a riding in Toronto full of consumers. I have a riding in Winnipeg full of consumers and I can understand a consumer's point of view when they say: "Well, what about this industry? Are we not already paying a lot in the way of food?"
Let me point out that when it comes to our disposable income, we spend about 11.5 per cent on food. We are probably about the second best country in the entire world when it comes to spending a portion of our disposable income, 11.5 per cent, on quality food.
Let me go on, because I know there are consumers who wonder about certain prices. Let me point out some prices to you. During the 1980s the cost of a box of corn flakes went up almost 100 per cent, about 94.5 per cent. The cost of a box of soda biscuits went up by 235 per cent, sweet cookies went up 135 per cent and cereals went up 194 per cent. As my hon. colleague points out, when those prices were going up, skyrocketing like that and the consumers were feeling it, what was happening to grain prices? They were going down. Farmers today are living with grain prices that their grandparents lived with back in the 1930s.
When the consumer looks at prices on the store shelf and expresses concern, and understandably so, do not blame the farmer. Do not blame supply and management. Those prices skyrocket after leaving the food processor. Those prices skyrocket after leaving the farm gate.

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I just want to mention a couple of other points. The price of a litre of milk, for example, in the province of Ontario at the farm gate since 1980 has gone up 19 cents per litre. On the store shelf the price of a litre of milk has increased by 73 cents a litre or 97 per cent. I could go on and on and on comparing the prices that farmers and producers get with the prices that consumers have to pay, and over and over again the proof is there, that you cannot blame those consumer prices on the farmer. If there are unreasonable price increases, look at the people in the middle. That is where you should point your finger of blame.
I think I am running out of time. I just want to say over again that it is absolutely paramount for the future of supply management and the producers who work under supply management that we hold on to article XI. We remind the government that it must go to the wall on this article XI. It cannot be a party to any agreement that will cut out article XI.


Lise Bourgault: Mr. Speaker, Canadians are saying-and I know the member is fully aware of it-that they are tired of highly partisan debates on subjects like this very important one.
Maybe if this House was made up of 50 per cent women those highly partisan debates would not take place. We would discuss strictly what is going on.
The member is suggesting that the majority of the members on this side of House who represent rural ridings in Canada are not supporting farmers.
This is a nonsense debate. I have to say this, Mr. Speaker. The Government of Canada is trying to strengthen article XI against the world. We have certain countries, but the Uruguay round now has its mind directed to new ideas of tariffication. We are opposed to this. We want to strengthen this and we need the Liberal Party behind us to support our farmers, not to say out of the blue that we are not supporting farmers of this country. The facts are there and I want the member to recognize that.
We are not perfect people, but we are there. We are trying to help. We need the members of the Liberal Party and the NDP to say to the world that article XI is needed. We deserve it and we want it to protect the farmers of this country.


John Harvard: Mr. Speaker, I want to thank the hon. parliamentary secretary for the question.
I find it passing strange that at the very time when this government's agricultural policies are failing and agricultural producers in the country are losing confidence in the government, the parliamentary secretary pleads for understanding. She pleads for a non-partisan debate. Give me a break.
Here is a government that has been asked for months to provide emergency aid. Here is a government that promised farmers that it would tide them over when they moved from the old ad hoc system of payments to GRIP and NISA. Government members made a pledge and made a promise to farmers that they would fill the gap. They have not honoured that pledge and they have not honoured that promise. Why should we have any confidence in this government? The other thing is that the government reached an agreement with the United States in the FTA. There is an article in there which in effect says that each country would not raid each other's grain markets. The Americans have done it with their Export Enhancement Program. They have done it over and over again. What does this government do? Absolutely zero, zilch, nothing. It pretends the Americans do not exist or it pretends that the Americans are not doing anything. So why should we have any confidence in this government? The polls tell us that the Canadian people do not.


David Kilgour: Mr. Speaker, I must thank the member for Broadview-Greenwood for letting me go ahead of him. The reason is that I have a wife and four children I promised to meet in 15 minutes. He has been very kind to let me go ahead.
We are debating my party's opposition day motion to the effect that article XI of the GATT in regard to supply marketing systems should be strengthened and clarified during the current Uruguay round of GATT negotiations.
Let me, perhaps foolishly, attempt to state briefly the essence of this issue to the supply managed sectors of Canadian agriculture: industrial milk, eggs, chickens and turkeys. It is true, speaking as a westerner, that many of our producers in the supply managed sectors live in central Canada. But in 1989, the year for which I could obtain the figures, western Canadians had the following national market shares of our supply managed sectors: chicken, 24 per cent; turkey, approximately 28 per cent; eggs, approximately 34 per cent; and milk, 20 per cent.
October 3, 1991

There are, for example, about 5.6 million broilers in Alberta and 5.2 million broilers in B.C. Manitoba, the home of the member who just spoke, has about 2.5 million laying hens and B.C. has 2.8 million of the same.
In short, the supply managed sectors of our four western provinces provide a decent and stable living and reasonable consumer prices to thousands upon thousands of western Canadians.
In essence, article XI2 allows for the existence of farm marketing boards in a country without violating the provisions of the GATT.
My understanding from the most knowledgeable Canadian expert on trade matters, a former GATT negotiator on the Tokyo and Kennedy round negotiations, is that the current Uruguay round of GATT negotiations will in all probability soon result in the removal of article XI from the GATT. If so, in consequence our provincial and national supply management boards will soon fold for violating the current GATT.
The trade expert friend to whom I referred a moment ago assures me that in reality, the long-term viability of most of these various boards, provincial and federal, has already been dealt a fatal blow by the particular wording of the Canada-U.S. Free Trade Agreement. Canadian food processors are increasingly relocating to the U.S. where most food products can, for a variety of reasons which were mentioned by the member who just spoke, be bought more cheaply than here and then exported back to consumers in Canada through retail food outlets.
If however GATT removes the article XI exemption, the present cabinet in Canada can attempt to blame the GATT member nations for the demise of our marketing boards, which will be a veiy misleading conclusion to draw.
Why, one might ask, are the GATT member governments, approximately 100 of them, now likely to approve the removal of article XI? In essence, it appears that both the current U.S. administration and the European community member nations have no further interest in keeping it on the books, so to speak.
The U.S. government dislikes supply management on ideological principle grounds. My trade friend believes
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that the European community member governments have simply and finally-one might say it sure took a long time-had enough of seeing 75 per cent of the European community budget go each year to the Common Agricultural Policy, CAP.
A constellation of other interest groups in Europe, environmentalists, workers needing retraining and poorer European community members like Portugal and Greece have recently carried the day. Wealthy farmers on the Paris plains and others have simply lost the campaign to maintain the European community's megasubsidies on agricultural production.
The good news for the world, really, is that a very large GATT agricultural deal is in the works. It will be the biggest agricultural deal since 1957. It is likely to be announced shortly, thereby saving the current Uruguay round which, as everyone knows, has become beached on the agricultural rock.
My trade expert friend believes that a 35 per cent cut in the European community support prices for cereals which will bind the GATT and an over-all drop of about 35 per cent on export subsidies for agricultural exports are coming very soon, within a matter of weeks.
A new and better arrangement on GATT dispute settlements is also likely to emerge. There might also be a framework agreement on services. I remind you, Sir, that about 64 per cent of Canadians work in the service sector, so that would be a very good thing.
In short, it will be a minor or a major GATT miracle with good results for all but our supply managed and much abused farm communities.
I would answer with this. Today in Canada each farm family across the nation feeds approximately 65 nonfarm families. That is in the parliamentary secretary's riding. It is in virtually every riding in the country which has farmers.
For virtually all of our farm families across Canada outside the supply managed sector, one or more of the spouses are required to work off their farm to feed their own families. Is that not disgraceful?

October 3, 1991
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Somebody put it very well recently. "Our farm fields of dreams", she said, "have become acres of despair". Those opposite, if they run true to form with respect to article XI will see our remaining healthy sectors under supply management reduced to the squalor that affects so many other sectors.
Shame on those opposite who represent in this place the views of a few thousand wealthy residents primarily of Toronto and Montreal.


Lise Bourgault: Mr. Speaker, the now Liberal member who used to be a PC member in this caucus knows very well that the Progressive Conservative government of Canada supports farmers, is there to help farmers, and that the actual third level of revenue systems is on its way to being dealt with.
It takes a certain amount of time I know, and I am fully behind the farmers in western Canada. I remember when I sat on the agriculture standing committee that one day farmers from around Regina said to me that because of the despair and the low revenue of the farmers, family violence was emerging from among the agricultural sector which was not there before.
I was very concerned about this, given the fact that the farmers of this country are family oriented people. The emergence of family violence is a damaging factor.
I want to ask the member this. He is speaking about non-contingency agriculture that absolutely needs to export. On the other hand, Canada is faced with the reality of a supply management market which deserves to be kept in place because it helps. We know the difference.
He pointed out very well that if you are in agriculture in a contingency situation, you work as hard as the others but you are in a better situation than if you are not. This is one of the realities and I want to ask the member what should we be doing now to have both realities of farming in this country.


David Kilgour: Mr. Speaker, with all due respect for the hon. member opposite, I think that she seriously misunderstood what I said.
I said that there is presently a crisis in the non-contingency sector across the country. I wish she had come along, just a few days, when I campaigned for the Liberals in Saskatchewan. She would have seen the
poverty, the hardship and the distrust of the farmers of this province which is so important to us.
Since the hon. member is from Quebec, I would like to quote some figures regarding her province, if I may, Mr. Speaker. Of the 300,000 farmers across Canada, there are 41,000 in Quebec. They represent 26.4 per cent of our farm population, but own 40 per cent of the Canadian dairy industry, with their 500,000 plus dairy cows.
In Quebec, as she certainly knows, there are 3.8 million chickens and 15 million broilers. So, how can she be telling her constituents, from the riding of Oka I believe, that if my friend and myself are right, she will give these farmers another chance at a decent income and having a decent standard of living?
I know that she just loves the Canada-United States trade deal. I used to be a member of her caucus. Is she under the impression that farm products regulatory boards are better than FPAs? That life is getting easier for these farmers and her constituents? I think that, in all honesty, she will have to say no, Mr. Speaker. She must tell her constituents and that this trade deal has been a disaster for thousands and thousands of farmers in Quebec.


Lise Bourgault: Mr. Speaker, listening to opposition members makes me think that they must surely pray to the Lord every night to sit on the opposition benches when the time comes to make difficult decisions. They must surely be glad to be on the other side and always contradicting what the government does.
I asked the hon. member what he would do if he were sitting at GATT in place of the ministers who have to protect two agricultural sectors, one subject to quotas and the other not, in a world that exports, that buys and sells. Could he give me in writing his vision of what the minister could defend at GATT?


David Kilgour: Briefly, Mr. Speaker, I would tell her to read the motion we are debating today.
I think the reality, Mr. Speaker, is that those groups, as I said, who represent the opinions of the wealthy in Montreal and Toronto, must understand one thing: they are eliminating the protection as such for farmers in Quebec and the rest of Canada, first, because of the trade agreement with the United States, and second, with its position on GATT now-which is not stated publicly, of course-but because of its position in GATT now in the Uruguay Round.


Dennis Joseph Mills: Mr. Speaker, I appreciate the opportunity of participating in this debate. In my riding of Broadview-Greenwood there are very few people who really understand what supply management is all about. I will take the words of the Parliamentary Secretary to the Minister of Supply and Services when she said earlier in this House today that she felt uncomfortable that we seemed to be taking a partisan approach in this debate.
I have been listening to the debate since my colleague, the hon. member for Lambton-Middlesex started earlier today and quite frankly I did not detect that tone of partisanship that she referred to. I have not detected anything in this House today that would suggest that we on this side of the House do not share the commitment that I hear from the government side today that it wants to keep the current supply management system in place.
In fact, earlier in the day I rose and addressed the Parliamentary Secretary to the Minister of Agriculture, the member for Huron-Bruce. I complimented him on the hard work he has done not only in his riding but throughout the world. I have been with this man when he has travelled and worked on behalf of Canada and I think he has done a terrific job.
What we have here in this country today is a genuine crisis of confidence. Also, there is a feeling out there that politicians in general are not trusted, not just politicians on the government side, politicians on this side.
As my hon. colleague mentioned this morning, this round of GATT we are heading into is an historic round. It is going to be a very complex round. We are in the middle of one of the most vicious trade wars that has ever happened in the history of the world.
When we have farm rallies coast to coast, the likes of which we have not seen in many years, it would be absolutely irresponsible for us on this side of the House not to put forward the views of all of those constituents who are concerned about the resolve of the government, concerned about whether or not it is going to take a firm stand. They are concerned about that because there have been incidents in the past where the trust that the government has been given has been shaken.
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I am not saying that trust given to Liberals in the past has also been shaken, but we are not talking about the past right now, we are talking about the present, and we are talking about a very important up and coming meeting.
Our responsibility on this side of the House is to make sure that the French, Germans, Italians, and everyone who is present at that round understand that it is not only the position of the Government of Canada but it is also the position of the opposition that we want the current supply management system to be in place and we are in fact united on that point.
The other point that we have to raise in this House is the fact that this is not just an issue for those people who actually live and work on the farms. In my riding there are over 300 restaurants. The restaurants in my riding are the primary employer. They employ not only on a full-time basis, they employ on a part-time basis, and we depend on quality food, security of supply, and on stable prices. Make no mistake about it, Mr. Speaker-


Mr. Della  Noce@: I'm hungry.


Dennis Joseph Mills: The hon. member for Laval-Est just mentioned that he is hungry. Whenever you are in Toronto, you are welcome in the riding of Broadview-Greenwood, Queen Street, the Danforth Drive. Please come. You are welcome.
Whenever I get a chance to speak here today on national television, I am not too shy about promoting my riding and the great restaurants that we have. You are all welcome.
The bottom line, Mr. Speaker, is this is not just a rural issue. This is an issue for those people who live in urban areas. As I mentioned earlier, last January when I had the opportunity to speak at the Soviet-U.S. citizen summit on the environment, and I was there for a few days, I had some spare time to walk around Moscow and visit some of the grocery stores. We in this country cannot imagine the desperate state that the people are in in terms of food supply in a place like Moscow. They start lining up for their food supplies at seven o'clock in the morning.

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It was embarrassing for me to see senior citizens with their brown sacks lining up for food. What was more embarrassing was to go into these stores and see the quality. Never mind the fact that the supply was virtually limited, it was the quality.
We in this country are blessed with not only quality food, we are blessed with security of supply. We are also blessed with the second best food prices in the world. That is something that we take for granted.
We take for granted the life of someone who lives on a farm. How many people have ever thought about what it is really like to live on a farm? In Toronto the only real reminder that you have about what a farmer's life is all about is if you get up early in the morning, and some mornings I get up early, and turn on radio station CFRB, which is one of our larger stations. At five o'clock in the morning you hear the news for the first five minutes and after that, for the next 10 minutes, you hear the farm report.
That is the last you hear of it. Why? Because a farmer gets up at five o'clock in the morning. He works until six o'clock at night. He works seven days a week. Very rarely do they get a day off. Then they have problems like lack of rain and, therefore, the crops are in trouble. Too much rain and they have got a problem. Try and find people today who want to work on a farm.
We in this country have, I believe, one of the finest farm systems that exists anywhere in the world. One of the reasons why we have that farm system is because our farmers have had a system that has allowed them to produce quality food with stable prices. We as Canadians have benefited from that from all walks of life, from all regions of the country from coast to coast, to coast.
I cannot believe that anyone in this House or anyone in this country does not believe that we as a country must have an image, must have a strength to show that we are a nation that measures our strength by the mouths we feed, not only here but all over the world, a nation that measures our strength at the same time by the environment we protect.
I want, and I have less than a minute left, to try and give one constructive piece of advice to the Government of Canada. It said earlier today that it is going to the GATT round committed to keep the supply management system in place. I mentioned this last week to the Minister for Grains and Oilseeds.
It is no good to communicate our problem just to those officials and just to those politicians who attend that meeting. Go over the heads of those officials and go over the heads of those ministers of agriculture and go right to the people of Europe. Take some of that money out of the envelope that is promoting Canada's 125th birthday and put it into communicating some of the concerns that we in this country have and some of the necessary things that we have to do in terms of protecting our environment with farmers, not only in Europe but here, so that we can get through this crisis together.


Mr. Len Hopkins (Renfrew-Nipissing-Pembroke):: Mr. Speaker, I want to congratulate my colleague from Broadview-Greenwood for his excellent remarks. As an urban member, he has taken a very deep interest in agriculture. We really appreciate that because this debate has taken on a new tone of interest in both urban and rural Canada, and that is precisely the way the issue should be.
My hon. colleague talked about his restaurants and the quality of their food and of course the production of food within Canada generally. He realizes that in order to keep up this quality and quantity of product, we are going to require great negotiating skills as well as negotiating tools in the present GATT rounds. Therefore, some things become very important.
In terms of skills, I have not heard too many compliments in the House today about the way this issue is being handled. Second, with regard to negotiating tools, the Minister for International Trade, as was so aptly put forward this morning by the hon. member for Lamb-ton-Middlesex, stated that each nation participating in the GATT round had to submit the amount of money that was being spent on programs to support agriculture in the various countries, and $8.8 billion was submitted as the figure going into agriculture and government programs here in Canada, a totally inflated figure, and then $2.2 billion going into the dairy industry of Canada. That is another totally inflated figure.
I want to ask the hon. member who has just spoken: if we are going to win this debate, why are we giving away tools such as that? Why are we inflating those figures? Surely we are providing an argument for the other countries to use against us. Has the government not shot itself in its own foot on behalf of the agricultural community of Canada?
October 3, 1991


Dennis Joseph Mills: Mr. Speaker, I wish I had an absolutely sure reason why the government seems to from time to time play gymnastics with its figures. I really do not have the answer to that.
It seems to me that part of the reason why we have this tension in the country today is that if we play gymnastics with figures too often, the trust factor breaks down. That is probably the greatest reason why we have a crisis today, not in terms of just the agricultural community, but in every other sector. There is not a sector of our economy today that does not feel the lack of trust. Trust is the central issue now in public life. Nothing else really matters.
I believe that because of the intensity of this debate today, we are saying to the government that we trust you so that when you go to these GATT rounds in the next short period of time, you will live up to the commitment you made in this House today, and you better not come back with an empty basket.
I repeat, I believe that if we can send a signal to people that we want to be a nation that measures our strength by the mouths we feed not only here and abroad, but also that we are a nation that is concerned about our environment, I believe that if we put that message into the GATT negotiations, we can maybe put pressure on some of those European countries which are ignoring some of those environmental regulations.
Maybe we can get them on focus, and that will put a more balanced approach to this agricultural problem.


The Acting Speaker (Mr. Monteith):: I have received written notice from the hon. member for Trinity-Spadi-na that he is unable to move his motion during private members' hour on Friday, October 4, 1991.
It has not been possible to arrange an exchange of positions in order of precedence pursuant to Standing Order 94(2)(a). Accordingly, I am directing the table officer to drop that item of business to the bottom of the order of precedence.
Pursuant to Standing Order 94(2)(b), private members' hour will thus be suspended, and the House will continue with the business before it prior to private members' hour.


Mr. Rex Crawford (Kent):: Mr. Speaker, I am very
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pleased to rise in the House today and speak in full and complete support of the motion put forward by my colleague, the hon. member for Lambton-Middlesex.
The member and I go back many years in both politics and agriculture, more years than I would like to admit to, and I am proud to support the motion of the member whose riding borders on mine in southwestern Ontario.
This morning the hon. member from Elgin-Norfolk in debate and in answering questions-I did not have the opportunity to question him-stated that he had replaced the Hon. John Wise who was then Minister of Agriculture. He referred to the hon. minister as the finest agriculture minister the Progressive Conservative Party ever had. He was a gentleman, and I support those views 100 per cent. In the riding of Kent we always held the Hon. John Wise in the highest esteem. I remember the hon. minister making a statement that if the marketing boards were ever to weaken he would resign. In September 1988 the Hon. John Wise resigned.
Later today I hope to get the opportunity to ask the hon. member for Elgin-Norfolk that question. This time, I am speaking on article XI of the GATT.
As everyone involved in agriculture is aware, the current GATT talks will in large measure determine the future of farming and marketing boards and supply management as we have known it in Canada. The director general, Arthur Dunkel, has fixed a wheat deadline to produce a final framework. A complete GATT package should be reached in early November.
The vast number of subsidies for agriculture by the European Economic Community is the main stumbling block. The EEC proposes to cut internal support by 30 per cent over a 10-year period while considering to increase markets by only 3 per cent.
The EEC countries will not accept a complete elimination of support or even a 70 per cent or 90 per cent reduction for which the United States is calling. Canada wants 100 per cent elimination of all existing export subsidies over a 10-year period.

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The real issue on all these complex negotiations is our government support of supply management. Is it firm? As my colleague for Lambton-Middlesex has outlined, he believes that a deal has been reached that would include the tariffication of article XI of the GATT.
This would have serious negative effects on supply management in Canada. We have the best marketing systems in the world and nothing should jeopardize Canadian agriculture.
Supply management is based on three fundamental pillars: import restrictions, adequate price and production control. Our supply management system must be maintained and improved by the GATT talks.
Our system has brought stability for both producers and consumers. Canada's egg, poultry and dairy producers firmly believe that any final agreement not meeting that bottom line should be rejected.
Given that the government says it is committed to its supply management system in Canada, does the government recognize that to be viable and effective border protection is needed to ensure that imported products do not undermine our own production or returns?
As well, we must have firm border protection while allowing us to export. The inspection side of Port Huron, Michigan is staffed 100 per cent by full-time inspectors. What is the situation on the Canadian side in Sarnia?
A neighbour of mine and of the hon. Speaker was turned back at the border by Dr. Brown from the department of agriculture who was a vet for the U.S. government. This returned load cost the farmer $3,000 in losses. It was strictly a sham, in my view. I was talking to the doctor and I asked him if Carla was giving him a little trouble over the free trade agreement and GATT. He said: "No. The law has been there since 1907 and I am just upholding it". It is things like this that we are running into at the border.
I am meeting with some farmers in my riding this weekend to discuss the GATT. They want a chance to compete fairly with the support of the federal government. One is the chairman of the Kent Dairy Association and his group.
The issue of tariffication is one of the major stumbling blocks to a settlement. The proposed tariff equivalents would not offset the price advantage of American products. Tariffication would not limit the import of supply managed products. With no specific limit on the level of imports, it is impossible to run a supply management system at either the federal or provincial level. Tariffication for supply managed commodities would damage the entire Canadian economy.
As the agricultural industry goes, so goes the whole Canadian economy. Production would decline in most, if not all, regions in Canada as family farms are forced out of business. Our industry must be protected since the cost of an operation in Ontario is much more than a similar operation in Michigan.
I know that in my operation, in corn alone, it has a net of $90 to work with that that I do not have. I am not competing on a level field. Another example is the difference in interest rates on a 10-year mortgage, $14,690, a difference in favour of the U.S. farmer of 22.4 per cent.
U.S. gasoline is $1.35 plus a 10 per cent annual rebate for using gas that is 10 per cent ethanol as an environmental measure. Farm delivered gasoline in Canada was 54.9 cents a litre. The difference is 61 per cent higher in Ontario.
Fertilizers are 20 per cent a tonne higher in Canada. Dairy feed supplements with 40 per cent protein cost 73 per cent more in Ontario.
What about machinery parts? A package of six Case International French bottom plough points cost $115 in Emmett, Michigan. In Exeter, Ontario, the same points cost $143.70, a difference of 24 per cent. I am the same distance from Emmett, Michigan as I am from Exeter.
Our agricultural industry is vitally important to our nation. Too often people go to the grocery store or eat in a restaurant and think the food is magically produced. Our farmers are the bedrock of Canada and they are not getting a fair return for their efforts. A box of corn flakes is nearly 100 per cent corn, and yet the farmer gets only 14 per cent. That price last evening in an Ottawa store was $4.89.
October 3, 1991

A box of wheat crackers has increased in price at the retail level by 235 per cent between 1980 and 1989, but the value of the wheat in those same crackers is down 43 per cent.
If supply management is damaged by the GATT negotiations, Canada's dairy farmers could face a direct loss of $143 million in internal support plus $75 million in import protection for a total of about $218 million.
Farmers right now are being faced with Mother Nature and historic low prices. A Chrysler bought in 1949 when wheat was $2.85 a bushel was $2,800 and change. Today with the price of wheat 1,000 bushels will not put the tires and wheels on that car.
The farmers in my riding certainly know of the government's lack of support. On the Kent-Essex drought situation, the feds should join with the provincial government in transition funding until the next crop year.
Our poultry, egg and dairy industries must not be pawns in the GATT talks. The government has talked a good line and has said it supports the strengthening and clarification of article XI. We hope that it will not back down. Canadian farmers are worried about their future with GATT and with the free trade deal as double whammies hitting the agricultural industry.
All of us in this House support an end to the subsidy war. I am sure members from all parties hope for a successful resolution to the article XI question. The farmers of this nation deserve a fair share of the Canadian food dollar, an income that will allow them to survive and continue producing the highest quality food, not only for the people of Canada but for the opening markets of the world.


Lise Bourgault: Madam Speaker, I was pleased by the tone of the speech of the previous speaker, the member for Broadview-Greenwood. I hope he will listen to my comments.
I want to urge the hon. member for Broadview- Greenwood, whom I know is a very successful businessman, to join the Standing Committee on Agriculture because it is important for other sectors of the economy to participate in the debates relating to agriculture. He noted, in a good manner, that the business people in this
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country need to keep alive the supply management concept that this country is part of.
I want to say to the member who just spoke that this is a reality for the caucus members as well. I know, Madam Speaker, that you are a member of a very successful agricultural community. You will be inclined with me to say that never will any member of this caucus, the government that I represent, support any suggestion or attempt to withdraw, dismantle or do anything that will hurt or affect the supply management system in this country which protects the revenues and the lives of thousands and thousands of Canadians. We simply will not support that, Madam Speaker, and I am sure you will agree with me.
I want to ask the member if he is aware of this new tariffication system that the rest of the world is trying to put in place during those GATT negotiations and, if so, does he agree with it?


Rex Crawford: Madam Speaker, I thank the hon. member for her question.
I am as aware of the tariffication in other parts of the country as I am aware of free trade in other parts of the country and as I am aware of the GST in other parts of the country, which have all been the downfall of those areas. We as Canadians look to other countries for guidance. I do not know why we always pick the worst part of every country's programs. Here we are with tariffication and we are going to let other commodities come into Canada and completely decimate our crops.
I have been impressed by the questions of the hon. member this afternoon and of the different members here in the House. I was hoping that in future she would join us over here. She seems to be a real fighter. I certainly would appreciate having her on our side.
I am aware of the question. The answer is that it would be the start and ruination of article XI. It would eat away at it within five or ten years. It would completely wipe out our marketing boards.


Dennis Joseph Mills: Madam Speaker, I just could not let this pass by, and I don't know how I am going to finesse this question through you back to my colleague. I could not let that compliment go by from the member for Argenteuil-Papineau. Through you to that hon. member I would just like to let her know that she was so generous there today that she has an outstanding invitation from me to come to my

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riding and I would be happy to take her to dinner on the Danforth.


Madam Deputy Speaker:: Before we resume debate I would like the House to allow me to thank the hon. member for Elgin-Norfolk who was kind enough in his position as a member of the panel of committee chairman to preside over the debate this afternoon for an hour while I was attending other duties. I know everyone has been quite kind to him and I thank you all very much and I thank the hon. member very much.


Felix Holtmann: Thank you, Madam Speaker and colleagues of the House of Commons. It is indeed a pleasure for me to engage in debate and discussion on what is no doubt a very, very important situation facing Canadians. Let us be honest, when it comes to agriculture, other traders in agricultural commodities, even our neighbours to the south of us I think find the subsidy war a problem. A war is really what it has become with regard to agricultural products.
Let me make some comment on the proposal put forward as an opposition day for discussion. In my view, it is healthy that it was brought forward in such a manner because it does allow all sides of the House to discuss this matter and put our positions on it. If I read what I have heard so far correctly, there are not a lot of differences of opinion on this matter before us today. The argument, I suppose, is should one of these other parties be in power today they would do a far better job, or the fringe parties that would like to govern this country, whether they are in Quebec or in the west, would be able to do a far better job of dealing with this serious situation we are confronted with.
Can you imagine Preston Manning, for example, going out and solving a problem on a policy which he adopted directly from the Conservative platform? Read what was said in this House just last week by the member for Beaver River, who chooses not often in the country to debate the agricultural policy. As I read it, when examining the policy of GATT and the problems with agricultural subsidies, that group states: "The Reform Party recognizes that there is a need for transitional support to protect agricultural producers". With the dilemma we face right now with $2 wheat, you would think that the Reform Party would be at every one of those western
rallies of farmers who are demanding some action by the government. In reality, the Reform Party does not go as far as this party does in terms of finding solutions to those problems, which we have demonstrated in the past.
I find it quite amazing that the Reform Party seems to have a solution but in fact it has none. They use these funny little platitudes such as "well, when the price of these commodities come down in this country and that country, we will get out of our problem". That is not solving a problem, that is sitting back waiting for something to happen.
I am going to jump around a little bit and I am going to go back to May 1986. In 1986 our Prime Minister was in Tokyo. While some splinter parties were dreaming up ways of electing members to the House of Commons, our Prime Minister was dealing with one thing and it is probably the first time in a long time that under the G-7 our Prime Minister of Canada convinced others that agriculture and its concerns of trade are very important and should be dealt with. In an interview he said: "In an interview we decided, as you know, how important it was to raise agriculture and for the first time as a group,"-this is the G-7-" the heads of government focused on the paradox of preaching freer trade while pumping billions of dollars into subsidies for agriculture.
This topic dominated our discussions yesterday afternoon and today on the economic side.
Protectionism is damaging to everyone and especially to the poor countries which depend on agriculture almost entirely for their livelihood. Canada has been obliged to take some actions but to try and even match others, as I indicated to our colleagues at the summit, for Canada to even attempt to match the magnitude of subsidies elsewhere would savage the government's deficit reduction efforts".
I think we could even probably go further and I think we could say that in this House of Commons on those in the House elected, and not those who would like to be from some of these fringe parties, there is no way that the government could match the subsidies on agricultural products that have been put forth by Europeans mostly and subsequently by the Americans trying to beat them out on some of the trade they once had.
October 3, 1991

I think there is probably a consensus in this House that that is the fact. From time to time opposition members have stood up in this House criticizing this government for too little too late. I can recall in 1986 and 1987, $1.2 billion, $800 million, those kinds of figures of money were put at the agricultural problem, we were saying too little too late.
Whether it is $1 billion this year, or another billion next year, it seems like we have not addressed the problem and the argument put forward is that we would be stronger at GATT.


Dennis Joseph Mills: We want you to stiffen up your back.


Felix Holtmann: Okay, I heard from the hon. member that we want to stiffen up our back. Listen to what was said here yesterday. Canada threatens retaliation over EC's farm subsidies. Is that not stiffening up your back?
Let me just quote this: "London. Agricultural minister, William McKnight, warmed his European counterpart yesterday that Canada will retaliate if there is still no resolution in sight to the trans-Atlantic grain subsidy war by the end of the year". It goes on to say: "I didn't put it forward as a threat. I put it forward as a fact".
I would think all members in this House would applaud the strength that this government has put into changing the GATT. This is it. This is the kind of thing that they thought this government never had the guts to do but it is doing it. Let us just go back, not because of this resolution, just a few days ago to September 30. Here is another news release. "The federal government", and you have all talked about it, you have all admitted it is there, you could not reaffirm it from your side any more than we could on our side, "is firmly committed to negotiate an agreement which protects our supply management programs".
Nobody has denied that, except a fringe party that would like to rule this country, the Reform Party. It does not even want supply management programs.
The issue is trust. I suspect there is an element of people that think this government is going to sell it away. There has never been any evidence given to date that we intended-


Dennis Joseph Mills: Not sell it, give it away.


Felix Holtmann: Give it away. There has never been any evidence, Madam Speaker, that this government intends
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to give that very fundamental part of the agricultural scene away to anyone. In fact, minister after minister and, year after year, our Prime Minister said that very thing in this House.
Let us go back to another news release. This is not so long ago, the hon. Minister of Agriculture: "I want to underline to Mr. McSharry the disastrous effects the subsidy war is having on the Canadian agrifood industry". He points as straight a point as anybody else could make it. One would argue that if you looked at the New Democratic Party.
Would for example the member for Esquimalt-Juan de Fuca have been able to make a stronger case than our Bill McKnight did? I doubt it.
How about the Leader of the New Democratic Party? Is she not, that wonderful charming lady, a forceful individual? I rather doubt that it would have happened any better than under this government with the importance this government places on this very issue.
Here we have a government that defends the right of marketing boards supply management and at the same time attempts to find some sanity in the trade war. It is a trade war.


An hon. member:: It was that party resolution that caused the problems.


Felix Holtmann: Somebody mentioned it was a party resolution that caused this event. Do we realize how many times we would need to have days in the House to discuss party resolutions if we looked at the resolutions of the New Democratic Party? Would they fly in the face of this House? The same is true of resolutions of the last Liberal convention. Would it even think of introducing them as a party in this House? Likely not. Those are realities that from time to time a party does put before its general membership and asks for an opinion.


An hon. member:: They don't mean anything.


Felix Holtmann: They do mean something. I know the member is baiting me. Do they mean anything? I suppose they mean as much to the Conservatives as they do to the New Democrats or as they do to the Liberal Party. It does not get a real airing. They do not not get a debate, some of these resolutions that we have. They do not get the same debate as they clearly do in the House of Commons. You have given it a whole day.

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The point is, the debate is healthy because it draws attention internationally to the concerns we collectively have as a people in our farming community of the total damage this does to our agricultural sector. The European common market, which we all sometimes admire as a collective organization, is not without its problems internally with respect to this very subject. I suspect lately if any members have had the opportunity in this House or you, Madam Speaker, as I know from time to time you meet international bodies and delegations, to talk to the Europeans and ask them about the French farmers within the EEC and whether they are prepared to play on the same playing field as they are with their member countries, you would find that there might be a little war brewing over in Europe on this veiy subject hoping that they can still maintain their trade balanced within each other's respective communities.
There are no simple solutions. There is a desire to get the international community to really look seriously upon us as by far the fairest traders in agricultural commodities. I can also say to my colleagues in the House that we demand fair trade among European countries with our products, yet we do not even have free trade within our provincial boundaries.
That has got to be part of our whole constitutional change as was proposed by this government. Maybe it needs to be altered, but I am saying if we want to say to the Europeans that we are totally free traders, then we should eliminate the trade barriers that exist between the provinces. They distort natural market productions and market forces which would make our products even that much more competitive on the international scene.
I would wonder if the New Democratic Party has a position on the interprovincial trade barriers. I would be interested to know its comments on it. As a way of unifying our country I think that is a major step we have to make.
While this debate is important, I think it is pretty fair to say that the policies taken by this administration in this particular area need very little criticism. It may be up to some criticism. I think if we look at the amount of moneys that the government over the years, as long as I
have been elected to this House, has applied to agriculture, it has not been insignificant.
At the same time, it has not solved that international problem. The Reform Party quite flippantly says: "Oh, we will just have to get them to all reduce little by little and we will all be wonderful children at this big, international family. We will be a very happy group of farmers and agricultural exporters, and our economy will boom and grow."
Where is Preston Manning when we are having a dilemma with farm demonstrations? Where is he? He is in Atlantic Canada on a little fishing boat floating around. He never dared show his face at an agricultural meeting. That group wants to quickly reduce any funding going directly to farmers because they have this funny, secret little formula.
The member for Beaver River does not show up at a farm rally to find out how she can help the grassroots. The new Reform Party for those of you who do not know wants to represent grassroots.
My friend from Winnipeg knows very well that you have to be within the ridings to understand what people are saying, especially if you have little agricultural background. You cannot go around looking at wheat fields and saying: "Isn't this terrible?"
When there is a demand to do something, you have to come up with a policy. I admire the member for Winnipeg St. James for attending farm rallies. He may not have always said the right thing, but you have to listen to what farmers are saying. You have got to be there to form an opinion and his opinion may not be the same as mine in terms of finding a solution, but for goodness sakes, he goes to the meetings.
We have a new party in Quebec that is going to solve all the problems of Quebec. I have never heard one of them talk about concerns they had for the farmers in the province. There is no imagination, there are no ideas. By listening too much to the splinter groups deciding what the future of the country will be will fracture any concrete decisions that the government has to take.

While this is a very important consideration that is put forward as a proposal, it is not so much a proposal but a reassurance that those supply management boards will stay. I believe we made our case to the Europeans; that it is not on the table. I as a former farmer-


An hon. member:: As a former alderman.


Felix Holtmann: My principal business now is politics.
As a former farmer, I am very well satisfied that in fact those situations as have evolved in Canada and were set up by Canada-earlier I heard a speech of a member who said that they were there when they initiated the Egg Marketing Agency which was in a mess at one time-served Canada well, and I believe they reflect not at all on our ability to trade as a free trader.
I think I can conclude-I do not know how much time there is-by saying that the debate is important. Agriculture is important. I think there have been enough illustrations and demonstrations that our combined Ministers of Agriculture and our Prime Minister have constantly put agriculture at the head of their agenda items every year since I have been elected.
It has been a long time since a Prime Minister has given the consideration to agriculture as our Prime Minister has. You may criticize him, but you cannot say he has avoided such an important issue. Nobody can say that in this place, because there is just too much evidence the other way.


William Alexander (Bill) Blaikie: Madam Speaker, I would like to begin by saying that, as always, the member for Portage-Interlake has been interesting to listen to, if not always informative in the sense that I do not agree with everything he has to say.
I do agree with him though that the Reform Party is not levelling with a lot of the people it is courting for support. It is not levelling with those people with respect to its agricultural policies, it is not levelling with those people with respect to policies on medicare, it is not levelling with those people with respect to its policies about the GST and a host of other policies.
It is hoping that somehow its position with respect to Quebec will cause people not to take seriously all their other policies and vote for them in that respect alone. I think it would be a tragedy if people in the west or
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Ontario or anywhere else were simply to support the Reform Party on the basis of their perceived position in the constitutional debate. It is a position that is largely irresponsible, in the sense that it does not have to take what happens to the country into account in its constitutional posturing.
I did not get up to talk about the Reform Party. I got up to talk about this motion. I think I will respond to a few of the things that the member from Portage-Interlake said first and then, if I have any time left, I will try and speak directly to the motion.
The member mentioned the European community. What he did not mention and what was significant by its absence is the fact that the European community and its economic integration, its single market that is coming into effect in 1992, is a single market that is accompanied by a social charter. One of the conditions for the single market in 1992 in Europe is the social charter. Yet the proposition brought forward by the New Democrats, the leader of the NDP, the premier of Ontario and others that there be a social charter as part of the constitutional package is not taken seriously by the government. At the same time the member, on behalf of that same government, wants us to take seriously the European Economic Community and the way in which it is arranged for the free flow of goods and capital services, et cetera, within the 12 European countries.
You cannot have it both ways. If you want to cite the European community experience then you also have to take seriously the fact that it has brought forward a social charter. I would invite the member to think about that inconsistency and not cite the European community unless he is willing at least to admit the objective fact of the matter, that a social charter in Europe has accompanied the things which he wants us somehow to imitate or take seriously here in the Canadian context.
The member for Argenteuil-Papineau and others spoke about the government's commitment to the preservation of supply management. I am glad to hear those words, but I think they are grounds for anxiety. These motions do not just originate out of nothing. They originate out of a legitimate anxiety on the part of many people in the agricultural community and in the political community, but this government is not as committed to supply management as it may seem.

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Let me cite a number of reasons why I think that anxiety is legitimate beginning with the free trade agreement. The free trade agreement in the North American context, never mind the global context, has created economic conditions for the kind of pressure that could eventually erode marketing boards here in Canada, with or without an agreement at GATT to do so.
I do not want to re-live the entire FTA debate, but the fact of the matter is that regardless of whether or not the text of the FTA agreement itself said that supply management systems would be disposed of, the fact is that the FTA created an economic context in which the pressure on supply management will eventually be irresistible because of the increased degree of free trade in food processing. Our food processors, having to compete with imports or whatever you want to call them that come from the United States in a non-supply managed context, are eventually going to be in a situation where something has to give. Either the food processors will give and go to the United States, or our supply managed system will have to go. These are the kinds of pressures which have been set up by the free trade agreement supported, promoted and passed by this government. People who know that, know that the commitment of this government to supply management is certainly not 100 per cent.
People also know that this is a government which has tried to make light of the whole phenomenon of crossborder shopping. It is another phenomenon which is not unrelated to this whole question of supply management. What are a lot of people doing when they cross-border shop, particularly in places where they can go every day? In many cases they are going across to buy milk, cheese and other dairy products, things which some people would argue are cheaper in the United States because they have a completely market oriented way of dealing with these particular products.
The government does not want to admit that. It wants to play down the cross-border shopping phenomenon. We saw that even today, when I asked a question of the Minister of National Revenue and he refused once again to acknowledge the full extent of the problem that figures show, when you take into account just how much
Canadians are spending in the United States and not just how many trips they are making.
With respect to the whole question of supply management, people with any sort of political memory know other things about this government. They know that some people on the other side made their political careers out of and cut their political teeth on struggles against marketing boards. I could name some of them on that side who made their political careers initially by opposing marketing boards within the agricultural community in their respective provinces. Some of them have become ministers.
One fellow in particular, whom I otherwise quite respect, except that we disagree on this fundamental economic point, was the one responsible for taking oats out of the mandate of the Canadian Wheat Board when he was minister. This is another form of orderly marketing.
It is quite unreasonable for the government to say to members of the opposition and members of the public at large that we should relax, that we should trust this government when it comes to supply management. We know that as individuals many of them have a history of being against supply management. We know that as a government it has a history of supporting agreements, in this case the free trade agreement that has created a context which has put pressure on our supply management system. The lack of trust that exists there is not something that has just been created by opposition politicians for political purposes. It is a well grounded anxiety.
The situation that so many of our farmers find themselves in, particularly our grain farmers, has also been a subject of much debate today. I hope I will be forgiven if I use a bit of humour to describe the situation that so many of our farmers find themselves in.
I am reminded of the story about a fellow who comes into the hardware store and buys a hammer for $10. He goes out and sells it on the street. He buys it for $10 and just in front of the store he sells it for $5.
The next day he comes in and buys two hammers for $10 each. He goes out on to the street and sells them to the people on the street for $5. The next day he comes in and buys three hammers for $10 each and goes out on to the street and sells them for $5. This continues: four hammers, five hammers, ten hammers.
October 3, 1991

Finally the guy in the hardware store is having a hard time keeping up with all of this so he asked: "What on earth are you doing? You are buying these hammers for $10 and selling them on the street for $5. How on earth can you make a living?" The guy said: "It is not great, but it beats farming".
This is the situation that so many of our farmers find themselves in. What it costs them to produce the product is far and away more than what they are able to get in this tremendous international marketplace that has created this incredible tragedy. People on one side of the world are crying, literally, because land that belonged to their family for generation after generation is being lost to the banks as a result of wheat at prices that would have been acceptable in the 1930s. On the other side of the world people are crying, weeping, suffering and dying because they cannot lay their hands on that product. Is this not a wonderful achievement of human civilization? What a wonderful global order we live in that sees these two sets of teary-eyed faces; one because they are losing their livelihood and their family way of life and the land they have lived on for generations, and the other where people are starving because we cannot somehow get these two things together.
We do not have a system that depends on supply and need. We have a system that depends on supply and demand. Demand is defined by the ability to pay and demand is defined by the ability of certain companies and countries, in this case in the United States, to manipulate that international marketplace so that they can have the upper hand.
This government has been afraid, as have so many other governments over the years, to say what is really going on here. What is really going on here is evil. It is evil that we should have this kind of system where people are starving to death and, on the other hand, the grain is piling up on the ground for lack of the ability to sell it at a reasonable price.
The problem with the government, it seems to me, with respect to the so-called trade war between the Europeans and the United States is that given its sort of economic ideology it cannot really understand what the Europeans are doing. Because the government wants to
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understand the world completely in market terms, it thinks that the Europeans are just sort of being bad guys, that they are just cheating. In a world in which obviously we all accept, according to the Conservatives, that the market is the thing that rules, then people who distort the market by having the common agricultural policy or various things like this, these are bad people; these are people who do not understand reality.
What the government does not understand is that the Europeans have not made just an economic policy or an economic decision. They have made a social decision. They have made a social policy decision that they want to preserve their farmers and their farms and the way of life associated with farmers. This is completely above and beyond the capacity of this government and the Americans to understand.
Instead of making that same decision and saying "do we want to make a similar decision", do we want to say: "We will support our farmers and our farms and that particular way of life because that is a social decision, not an economic decision"? Instead, they are trying to do it on the cheek, so to speak. They are trying year by year, protest by protest, program by program, to make this problem go away by just giving them a little more. They are never willing to go the whole way, to make the full commitment, to say-and I think this would help with respect to the Americans and the Europeans to give a clear signal-"You are not going to win this war with us. You are not going to let your particular economic strategy wipe out the Canadian agricultural community". We have not given that kind of signal. We have also looked like we are saying: "Oh, gee, do we have to put another dollar on the table? Okay, well if there is enough pressure, and maybe there is an election in Saskatchewan or some other contingent factor, we will come up with some more money".
Instead, we should be making it absolutely clear to the people what we are up against in this and that we value our farm community as much as they value theirs. So far that is not the signal that this government has put out, in spite of the fact that it has spent, and I acknowledge this, incredible amounts of money. But all of the money that has been spent is for naught if in the next little while you

October 3, 1991
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allow all those farmers that you have been supporting over the last little while to go under.
They will not be there. Farming is not something that comes back in the Same way as other economic activities. People leave and they lose their farms to the bank. It is not easy to just pick up and start over again. It is not like walking back into the factory, or whatever the case may be, although even that is getting to be more difficult. If it is not farmers losing their land, it is plants and factories shutting down and moving to the United States, which is an entirely different problem.
I think we need to make that kind of commitment to our farmers. I am sure that there are individuals on the other side who would like to see that kind of commitment made. I am sure that even individuals who are not willing to make that commitment understand and feel the dilemma that so many Canadian farmers find themselves in.
I do not know how so many of them do it, how they can tolerate this drop in their income, this incredible drop in their income, and carry on. It is only because farmers are the last vestige of what we call vocation. They are the last vestige of the people who have vocation.
We have taught people in our society for decades now that life is chasing after the buck. It really does not matter what you do, as long as you get paid well to do it. Farmers are some of the few people around still who say: "It matters what I do. If I get paid less and less and less to do this, I am so attached to this way of life and this way of earning a living that I am going to hang on till the vety last moment".
I think people who have that sense of vocation, whether it comes out of an attachment to the land or an attachment to the idea of providing food for the world, should be supported. I think we should find ways to support them, ways that give support in particular to smaller farmers, but I think we should find ways to make sure that we do not end up with a return to what I would call an agrifeudalism, in which the land is owned by a very small handful of people, the way the rest of the economy is owned by a handful of people.
The one thing that you could at least take some comfort in as the rest of the economy comes to be owned by 20 prominent families in the country is that at least
the land is owned by thousands and tens of thousands of families. Even that is disappearing.
We went through centuries of economic and social development to get to a point where one person, one institution, one power or one authority did not own everything and did not own the land. That was the promise of the new world of Canada. It was not exactly much of a promise to the aboriginal people, but let us leave that aside for a minute.
We are returning now to a situation in which fewer and fewer people own more and more of the land. Corporate farming, agri-business is the wrong way to go. The fact of the matter is that this government is not committed to fighting that over-all trend. Its friendships, its connections, its networks are all with the wrong people in this respect, with the multinational grain companies and the vertically integrated Royal Dutch Shells and others who want to control everything from the ground up, the patented seed, the fertilizer, the herbicides, elevators and the transportation system. You name it.
They have not got everything into place yet, but just about everything. What they need really now is to find a way to own the railroads, which they have in a surrogate form through the CPR for years anyway, and then find a way to own the land.
That will not bother anyone over there. There will still be the hon. member for Assiniboia talking about the NDP land bank and how we want to have massive collectivization of farms. He is worrying about something that was never in the cards here. Nobody ever wanted it. It does not concern him a bit that all the land may someday be owned by a few multinational corporations or by the banks. It does not bother him.
I say this is wrong and I say this is the blind spot in the approach which this government takes to agricultural policy.


Lise Bourgault: Madam Speaker, finally, finally, the very influential NDP member said he praised the government for 650 per cent augmentation of intervention in farming. The farmers are very proud people. They do not want subsidies. They want fair trade. They do not like to receive their income from the government. They need it but they do not like it. Nobody likes to have subsidies or a welfare cheque. When you need it, it is necessaiy, but farmers are proud people. I know that because they have told me that, at least my constituents,

and I know the member's constituents feel the same thing.
I posed a couple of difficult question to Liberal members and maybe they were not in a position to respond, but I will ask the NDP member if he agrees with the position of the federal government which is now working on this, that what we ask for at the Uruguay round negotiations is substantial reductions in trade distorting subsidies, particularly export subsidies; increased access to export markets; clearer and fairer GATT rules including the clarification and strengthening of article XI; and a framework of rules to prevent the abuse of health and sanitary regulations as barriers to trade.
Does the member agree with the position of the government under the auspices of the GATT? Just a simple response, thank you.


William Alexander (Bill) Blaikie: Mr. Speaker, the member tries to simplify the matter in this respect: over a hundred countries agree with that particular statement. The problem is trying to figure out what that means.
What is a trade distorting subsidy? That is the debate, is it not? Everybody can say: "We are against trade distorting subsidies", but what does that mean? Some people believe that any involvement of government in the economy is a trade distorting subsidy. Other people may not believe that. That is what is at issue.
What is at issue here is whether this government, the government of which you are a part, actually believes that things like supply and management are not trade distorting subsidies or whether it believes in the dark recesses of its mind, and sometimes in the not so dark recesses of it mind given the things that it has said and done in the past, that actually supply and management is trade distorting. It cannot possibly admit that just like it couldn't possibly admit that in the free trade agreement, so it had to go through the whole agreement saying: "We believe in supply and management, we believe in supply and management, we believe in supply and management".
Show us in the agreement where it says supply and management is not being threatened. Everyone who knew anything, anyone who had two brain cells to rub
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together, knew that the free trade agreement threatened supply and management.


Lise Bourgault: I want to ask the opposition member about the particularity of Canada as an exporting country. Maybe all farmers, maybe all producers in this country should be under a marketing agency. For instance, look at the pork producers, potato producers, oilseeds, you name it, that not actually under a supply management organization.
Maybe at the end of this, because we are now discussing it on a world basis, because GATT is all countries together, the member will ask whether it is fair. Let us look at a pessimistic situation. At the end of the day when it is all over the world will say: "No. Article XI, we do not want to strengthen it. We do not want to do anything to it, but we want to go to tariffication by the Americans", I suppose.
Given the facts and taking into consideration that production in this country is not all under supply management, what will the member do if we have the obligation to do something as a government? If you were the government what would you do?


William Alexander (Bill) Blaikie: I am not sure I entirely understand the question. I think the member is hypothesising everything breaking down or the United States getting its way. Is that what you are saying? Supply management was seen to be a trade distorting practice. Is that what the hon. member is saying? That is a situation that any government of the day would have to deal with.
I think that an NDP government, for instance, would regard that as much more regrettable than I think a lot of your own people would regard it. Without questioning the integrity of the hon. member who just spoke, there are a lot of people on your side who are critics of orderly marketing and of supply management.
If the GATT breaks down it would be a dilemma. You want to have an international trading system that works and one for which there are generally accepted rules. On the other hand, you do not want to have a system which prevents countries from defending their legitimate interests and which simply imposes upon the global marketplace the kind of "survival of the fittest" that we have had in other contexts.

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I think a lot of people in the Third World, for instance, are particularly concerned about that. At the same time as they want liberalized trade, they want trade that is fair and that respects their ability to look after their own interests.
If the worst case scenario that the hon. member points out were to happen, that would happen in a particular context. I think it would be very difficult for me or anyone else, including the hon. member, to speculate on just what the response of the Canadian government might be at that time.


Leonard Donald Hopkins: Madam Speaker, this debate that we are having in this House today is one of the most important debates that could take place in this country. It is also a very historical debate because the industry that we are discussing today, agriculture, is as old as the first pioneer in this country. The first pioneer normally had a cow and a few chickens. This debate is on supply management. He certainly knew what his demands were in that day. He had to raise enough food to live, to start off.
Those early pioneers who came to this country and built up the agricultural industry, those pioneers who built all those stone fences and stone piles and cleared the land and built the farms, had really built the very basis of this nation. Today those farmers who are carrying on in that tradition deserve the help and every inch of effort that we can give them to win their case for them on supply management, because that is the lifeline of the farm community in those areas today.
To give the extent of the industry we are talking about today, Canada has 300,000 farmers. Quebec has 41,000, the fourth largest farm population of all the provinces. Ontario has 72,000 farmers, which is the largest farm population in Canada. In the dairy business, Canada has 35,600 dairy farmers, 16,000 located in the province of Quebec and 11,000 in the province of Ontario.
Ontario has 475,000 dairy cows, a farm average of 34 cows. In Quebec the average is 33 cows per farm, with a total cow population in the province of Quebec of 578,000. Dairy farming in Canada produces cash receipts of $3 billion a year. Basically, that is the industry we are talking about here in this House of Commons today.
The way this ends up at the GATT is going to tell us how successful that industry is going to be in continuing in this country.
I heard the hon. member for Joliette say that it was too bad that we are having a partisan debate on this issue in the House today. I am sure that every Canadian watching this debate today will fully understand our feeling about that when they see the kinds of answers we get on agriculture from this government in the House of Commons. Is it a love-in when it gives its answers? It gives answers that are so wishy-washy, it does not come to the point. When it does, it is certainly not gentle about it in the terms the hon. member for Joliette would like to see.
He said it was too bad for people the government was not doing anything. Normally, when governments are doing something, people recognize it, but they have to see the evidence of it. That is another thing this debate is about today. We want to see the evidence.
Would it ever occur to the hon. member for Joliette, for example, that the last thing we would ever want to happen to us in this House is to be identified with the image and policies of this government?
The Liberal Party of Canada brought in the National Farm Products Marketing Agencies Act, and we want to see it rescued. We want to see it continued and working effectively for Canadian farmers. The agencies that came in under this act have served Canada extremely well.
I did not speak about Hazen Argue today in a eulogy to him because I know that Hazen Argue is out there tonight, delighted that there is a debate on agriculture in this House of Commons. He lived for agriculture and he was a very dedicated figure in that field.
The National Farm Products Market Agencies Act was proclaimed in January 1972. I remember, I was here when that was proclaimed and I was here in this House with a number of other members between Christmas and New Years of 1971 because we had come back purposely to pass the farm marketing bill. It was proclaimed the following January.
No other Canadian knew we were here because they were celebrating the festive season and they would have thought we were a little off our rockers if they knew we
October 3, 1991

were sitting here in session in the House of Commons between Christmas and New Years.
As I stand here today to speak on the GATT negotiations and the possible destruction of our supply management system because of the lack of muscle that is being displayed by the Federal Government of Canada at the GATT negotiations, I find this whole international process very depressing indeed.
The most dangerous development I see at these GATT negotiations is the common ground thinking and the common ground linking that is going on between the United States and the European Economic Community. Over the years of our history, whenever the United States teamed up with any nation in Europe, such as Britain or with the European Community against Canada, Canada has lost, historically. We lost the Alaskan boundary dispute in 1903 because the United States and Great Britain lined up against us. We lost the State of Maine in the province of New Brunswick boundary decision because they lined up against us.
We Canadians have to stand solidly on rational arguments and never give up trying to win this case on supply management.
We can never cave in, and the government has to develop a strong muscle. The view is out there that the government is a bit spineless when it comes to defending Canada's agricultural trade. The feeling is out there that the government is rather spineless when it comes to defending Canada's interests even in the free trade agreement, and now we are into the GATT discussions.
We see the United States which is supposed to be our trading friend lining up with the European Economic Community against Canada. Where is the international justice in a system like that? The government cannot afford to sit back and be anything but absolutely aggressive toward this united action on its part.
A lot has been said in comments today about the Consumers' Association of Canada. I simply want to say that it is not fair to make statements about food costs and food production in Canada unless you know the plight of the Canadian farmer first hand and unless you really know what is going on out there.
I grew up on a farm, and I have some knowledge of this subject. When you drive past a farm today, very few
Private Members' Business
people realize the tremendous investment that exists on that farm. They look upon it as a family home.
It is only fair that the farmers get a fair return on their investment because if they do not, they will not be in business and Canada will have lost that productivity. The farming pioneers of this country must be looking down on us in this House today and wondering what has happened.
I think that in negotiating tools, I cannot forgive the government for submitting $8.8 billion as a figure that the Government of Canada is giving to farm organizations in Canada by way of subsidies and help. That has destroyed a lot of its argument to begin with. It has taken away a punch, and even by saying $2.2 billion for the dairy industry, it is helping those who are against us in this argument. That is wrong.


Madam Deputy Speaker:: It being six o'clock p.m., it is my duty to inform the House that pursuant to Standing Order 81(17), proceedings on the motion have expired.

It being 6 p.m, pursuant to Standing Order 30(6), the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper.



PRIVATE MEMBERS' BUSINESS


[Stage Direction]
The House resumed from Friday, September 20, 1991, consideration of the motion of Mr. Althouse that, in the opinion of this House, the government should consider the advisability of introducing amendments to the Income Tax Act so that taxpayers whose income may fluctuate from one year to the next would be able to average their income over five years.
Mrs. Suzanne Duplessis (Parliamentary Secretary to Minister for External Relations and Minister of State (Indian Affairs and Northern Development)):: Madam Speaker, I am pleased to be able to participate in the debate on Motion 81 presented by the hon. member for MacKenzie which recommends the introduction of income averaging measures to the Income Tax Act. This, it is argued, would reduce the tax paid by individuals whose incomes fluctuate considerably from one year to the next.

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Private Members' Business
Although the motion talks of the introduction of such provisions, it would be more appropriate to speak of reintroducing them, as they were part of the Income Tax Act provisions until 1987. Indeed, two methods of income averaging were eliminated with the tax reform of 1988. These were general forward averaging and block averaging which was designed to assist farmers and fishermen. To ensure a smooth transition, taxpayers who deducted averaging amounts prior to 1988 have until 1997 to bring such amounts back into their income. This allows taxpayers to obtain a federal tax credit at the highest marginal rate during the year in question. The system of block averaging for farmers and fishermen comtinues to apply to the five-year periods that began prior to 1988.
Madam Speaker, in considering the possibility of reintroducing income averaging provisions to the personal tax system, it is important to review the reasons why these provisions were eliminated in 1988.
The methods of income averaging were eliminated with the tax reform of 1988. The reform was based on five broad principles.
The tax system should be fair and should respect Canadian views of social justice. It should be consistently progressive, imposing little or no burden on those least able to pay. There should be less variation in the tax position of individuals in similar economic circumstances.
The tax system should have a broader base and lower rates. It should minimize preferences that allow high-income individuals and profitable corporations to pay little or no tax. Rates should be lowered to encourage initiative and risk-taking. The tax system should recognize Canadian realities and priorities. It should support Canada's capital requirements for growth and development and contribute to Canada's ability to compete in world markets. It should support regional development.
The tax system should be more understandable and less complex.
The tax system should provide a stable revenue base, to assure reliable and predictable revenues to finance public programs.
Madam Speaker, the application of these principles centred around three major areas of change: First, the reduction of the ten income tax brackets, ranging from a tax rate of 6 per cent to 34 per cent, to three tax brackets with rates of 17 per cent, 26 per cent and 29 per cent; secondly, the conversion of personal exemptions and certain deductions into tax credits. Unlike deductions and exemptions which reduce the tax to be paid by an amount that reflects the level of income, tax credits reduce the tax to paid by a set amount, regardless of the level of income. Thirdly, the reduction or elimination of several tax concessions which primarly benefitted high-income taxpayers.
The elimination of income averaging provisions was part of the latter category of measures which, in broadening the tax base, made it possible to reduce tax rates. The reduction of the number of tax brackets and the lower tax rates meant there was less need for income averaging. In short, smaller differences between the minimum and maximum marginal rates, that is 28 per cent prior to tax reform and 13 per cent after, reduced the tax consequences associated with fluctuations in income from year to year. Moreover, with the broader tax brackets, there is a much lower probability that fluctuations in income from one year to another will give rise to an increase in an individual's tax burden.
Therefore, income averaging provisions were eliminated because of a reduced need for such provisions and in part to finance the lower tax rates.
Tax reform involved a series of interrelated changes and so it is not appropriate to assess the fairness and relevance of specific measures without considering the whole package. The financial statistics for the 1988 taxation year, which were released last year, provided the first opportunity to determine the impact of the reform as a whole.
These statistics clearly show that tax reform achieved its intended objectives: overall, personal income taxes were reduced by more than $2,5 billion; some 905,000 Canadians with incomes under $15,000 no longer had to pay income taxes; the number of taxpayers aged 65 years or older paying tax fell by approximately 300,000.
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One of the surest ways to threaten these gains would be to gradually reintroduce the provisions in place before the reform. The reintroduction of measures such as income averaging would narrow the tax base and would require an increase in tax rates in order to preserve the government's tax revenue.
Madam Speaker, the elimination of income averaging in 1988 was part of a broader initiative designed to make the tax system simpler and fairer. Given the positive impact of that reform, it would be counter-productive to take a step back and amend some of the elements that have contributed to its success.


Mr. Rod Laporte (Moose Jaw-Lake Centre):: Madam Speaker, I am pleased to rise tonight to speak on this bill put forward by hon. colleague, the member for Mackenzie.
The government opposite has been stating, as one of its objectives, a more fair and simpler tax system. I think that an average Canadian today would agree that this objective has not been realized.
There are a number of examples of the fact that taxation in this country is simply not fair. We can look at, for example, the fact that 58 per cent of married people pay more tax living as a married couple than they would if they lived as a common law couple according to Stats Canada. We have the example of corporations in this country with incomes in the neighbourhood of $30 billion on which no tax is paid, not even a penny. Compare this to the United States where Ronald Reagan introduced a minimum corporate tax. At least U.S corporations pay some income tax.
We have, along with that, the absurdity of people in this country, living below the poverty line, paying income tax. We have corporations, on the one hand, which can afford to hire expensive tax consultants, accountants and tax lawyers to look for loopholes in the tax law, many of which they lobbied to have put in place themselves, and on the other hand we have many families in this country which are barely able to make ends meet, can barely afford go to H&R Block to have their income tax done, are paying income tax and are below the poverty line.
Private Members' Business
Only one government in this country has said that it will do away with income tax below the poverty line and that is the Ontario government of Bob Rae. The New Democratic government in that province has said that although it cannot affect federal income tax, the people in Ontario living below the poverty line will not be paying any provincial income tax. That is a move towards tax fairness.
The government has also indicated that it had planned to make a simpler tax system. Again I think an average Canadian looking at his or her tax forms when they do their taxes would simply say that the income tax system in this country is neither simple nor is it fair.
This bill the member for Mackenzie has brought forward is an attempt, in a small way, to make the tax system in this country somewhat fairer. This bill would allow for five-year block averaging. It is not something new, in fact it is something that was initially brought into effect in the late 1940s. It is fairer for professions where income comes about in an unequal manner; people such as artists, sales people, real estate agents, ranchers, farmers, fishermen, writers, small business people, people who may have a number of years of low or mediocre income then suddenly have a year where things go very well for them and they have a very high income. Unfortunately, these people are now forced to pay tax on a very good year when in actual fact their over-all income over a longer period of time is much lower. That, I would suggest, is not fair, and I do not think the people who are into those situations would find it fair.
In the past, people had been able to average their income over a five-year period to allow them to pay a more equitable tax on their income. To me, that sounds fair. I think many Canadians find it fair. Certainly many accountants have found it fair. With respect to farm groups in western Canada, most farm organizations including the Western Canadian Wheat Growers, which tends to be a group that supports many of the government's measures, have said that this is a measure that is fair and equitable and should be maintained.
I believe it was removed by Order in Council in 1987 by this government. I have been following the debate on this quite closely. I have been reading the debates that I have not heard, and the government puts forward three arguments as to why this five-year block averaging

October 3, 1991
Private Members' Business
should be removed and should not be reinstated in the tax system.
I am paraphrasing from the parliamentary secretary, the lead speaker for the government who spoke on this bill, and he said that the fundamental principle is that ability to pay is measured on the basis of income earned and received in a single year. In other words, he is saying that a fundamental principle is that we pay income tax based on each year, regardless of over-all income.
I do not think that is a fundamental principle. That is why the five-year block averaging was put in in the first place, to take out the peaks and valleys. I think a much more accurate statement of the fundamental principle would be that people should be paying taxes on income earned, not being restricted to one single year. By the parliamentary secretary restricting it to one year, I do not think is a fundamental principle that most Canadians would agree with.
He and other members on the government side have indicated that the tax brackets have now been narrowed, that you have a minimum of 17 per cent to 29 per cent tax payable, and that is true. But what they have forgotten is that there is still a large gap, particularly when you take into account provincial income tax, which can mean an 18 per cent difference in tax payable.
If a farmer or a small business person has been having three or four or five bad years and suddenly has a good year and is faced with paying that extra 18 per cent, you tell them that that is not very much money and they are going to tell you something else. If a business or a farmer has been suffering for a number of years and suddenly has a good year, they need that money to help them keep their operation going, pay off bills and so on. So the idea of 18 per cent, I would suggest and many Canadians would suggest, is in fact significant.
The other fact is that the government likes to say that retirement is the most frequent and significant cause for income fluctuation. I think that perhaps that is true, in the sense that at some time in our lives all Canadians will suffer a radical drop in income, and often that occurs at the time of retirement. But this bill is not meant to deal with that. The fact is, we have a small percentage of Canadians which suffer from fluctuating incomes from year, to year, to year, to year. Although the government
can say that it has put in tax reforms to help retirement, that really is not the issue. That is not the purpose of this bill. That was not the purpose of a five-year block averaging. The fact that when people retire they can take advantage of RRSPs does not help a farmer or a businessman or a fisherman or anyone with a fluctuating income. It does not help them in that particular year.
I think the bill that the hon. member has put forward is a bill that will help those entrepreneurs, those Canadians who are into more open market situations. These are people who often run the risks of the marketplace, small business people, artists, people on commission sales, farmers, people who are subject to the disciplines of the open market. This is a government that likes to pretend it represents small business and farmers but in fact this is something it is doing that will hurt small business and farmers.
The argument that we cannot afford to bring in block averaging because it is going to cost the government too much money is again, I would suggest, not accurate in that the actual amount of money lost by the government would be very small and certainly could be made up quite easily. If the government would bring in a minimum tax for corporations, for example, it would more than offset any income loss that Revenue Canada suffered as a result of five-year block averaging.
I believe my time is almost up. In conclusion, I would like to say that if the government wants to have a prosperous nation it is essential that it provide opportunities for Canadians to make an income, and provide for themselves. This in a small way would help a particular group of Canadians to maintain themselves at a time when the Canadian economy is suffering very badly. I would simply conclude by saying that I do wish the government would reconsider its position on this bill and vote for it when the time comes.


Mr. Bruce Halliday (Oxford):: Madam Speaker, I am very pleased to speak today to Motion No. 81 which has been put forward by the hon. member for Mackenzie. It is designed to consider the advisability of introducing amendments to the Income Tax Act to allow some form of income averaging for the benefit of individuals whose incomes fluctuate significantly from year to year.

I am sure that members of the House would agree that the hon. member for Mackenzie is committed, and has been for many years, to the welfare of farmers in Canada. We have to agree also that before the Income Tax Act was reformed in 1988 it contained two provisions for averaging income over a number of years; block averaging and forward averaging, which colleagues have already alluded to this afternoon. These procedures allow taxpayers with large fluctuations in their incomes to spread the burden of tax over a number of years. Both forms of averaging involved complex calculations.
Consider first the block averaging. This was available to individuals whose chief source of income was farming or fishing and it allowed them to average their income from all sources over a five-year period. This provision involved a calculation whereby the taxpayer recalculated the tax liability as if one-fifth of his or her total income over the period had been earned in each of the five years.
An election to block average was made in the last year of the five-year period and resulted in a reduction in tax in that year or in the refund of taxes paid in the earlier years of the period.
The other income averaging technique was known as forward averaging. Unlike block averaging, forward averaging was not restricted to those involved in farming and fishing. It allowed all individuals whose income in a year exceeded 110 per cent of their average adjusted income in the preceding three years to spread out the excess over future years in order to reduce its impact on tax payable.
The excess income which was averaged in this fashion was deductible in computing taxable income for the year in question but gave rise to a special tax in that year at the highest marginal rate.
In future years the average amounts could be brought back and taxed as regular income with a refundable credit provided at the top marginal tax rate.
This was how the system operated before 1988 but as hon. members know the government reformed the corporate and personal income tax systems in 1988 and among the objectives of this reform was the creation of a tax system that contributed to fairness, competitiveness, growth, and job creation. To achieve these objectives, tax reform was guided by two major principles, lower tax rates and a broader tax base. It is readily apparent that
Private Members' Business
lower rates provide an incentive to work and invest, thereby contributing to the goals of competitiveness, growth and job creation. The pre-1988 system had 10 rates ranging from 6 per cent to 34 per cent. This structure was replaced with one comprised of only three rates: 17 per cent, 26 per cent and 29 per cent.
A related element was a conversion of personal exemptions into tax credits. Exemptions provide the greatest benefit to higher income earners, whereas credits are fairer because they provide the same degree of tax relief to all taxpayers.
The rate reduction combined with the conversion of exemptions into tax credits resulted in a fairer and more progressive tax system. I shall return to how these changes reduce the need for income averaging procedures in the tax system in a moment.
The other guiding principle of tax reform, namely broadening the tax base by removing special tax preferences, was equally important. A broader base makes the tax system simpler and fairer. It reduces the opportunities for tax planning, opportunities that were most often used by high income Canadians. Many tax preferences were eliminated or restricted. For example, the deductibility of business expenses for meals and entertainment was significantly reduced.
The hon. member for Mackenzie has proposed a reintroduction of income averaging procedures into our tax system. In order to assess this proposal properly, it is helpful to review the goals and methods of tax reform as we have just done. The lower and fewer tax rates which came with tax reform reduced the need for averaging provisions, a point on which I shall elaborate in a moment.
Since the need for averaging provisions was reduced, such measures were eliminated as part of tax reform. Forward averaging was eliminated for 1988 and subsequent years and the block averaging provisions for farmers and fishermen ceased to apply for any five year block commencing after 1987.
These changes were introduced gradually in such a way as to ease the transition. Forward averaging amounts deducted in prior years can still be brought back into income until 1997 and will entitle a taxpayer to a federal tax credit at the top marginal rate in that year. Block averaging arrangements that were already under way were allowed to run their normal course.

Private Members' Business
Let me now explain why the new tax rates and the reduction in the number of tax brackets brought about by tax reform reduced the need for averaging. Prior to the reform the spread between the lowest marginal tax rates, namely 6 per cent, and the highest, 34 per cent, was 28 percentage points. Such a wide spread of course had severe tax consequences for those whose income fluctuated substantially from year to year.
After tax reform the spread between the lowest, namely 17 per cent and the highest at 29 per cent with marginal tax rates was reduced to 12 percentage points. Furthermore, tax brackets became much broader and the lowest tax bracket now accounts for two-thirds of tax filers.
Therefore, year to year fluctuations in income are now less likely to move a taxpayer from one bracket to another. Even if such a shift does occur, it will not cause a significant fluctuation in tax burdens.
The reforms to the tax system made possible the elimination of averaging provisions and the elimination of the averaging provisions in turn contributed to making the tax system simpler and helped finance the reduction in marginal tax rates.
The most significant income averaging activity that typical Canadians undertake is that of putting away money during their working years to finance their retirement. This type of income averaging now receives more favourable tax treatment. Recent pension reforms provide substantial opportunity to defer income and tax. This tax assistance is based on the principle that money set aside for retirement should be taxed when it is received, not when it is saved.
Accordingly, amounts contributed to registered retirement savings plans, namely RRSPs, registered pension plans and deferred profit sharing plans are deductible in the year contributions are made and the investment income in these plans is not taxed when it is earned. Instead the savings are subject to tax only when benefits are paid out of the registered plans.
For the vast majority of taxpayers who have lower incomes and higher tax credits in retirement years and who therefore face lower marginal tax rates, the tax assistance provided for retirement saving includes an important income averaging advantage in addition to its tax deferral benefits.
As I noted, the system of tax assistance through retirement saving was recently improved. The new contribution limits which come into effect this year eliminate many shortcomings of the previous system and ensure that Canadians have fair access to tax assistance for retirement savings.
For example, taxpayers without an employer sponsored pension plan did not previously enjoy the same opportunities to build adequate pensions on a tax assisted basis. Those with relatively poor pension plans face the same RRSP limits as those with very generous pension plans.
The limits were also vulnerable to a growing number of tax planning arrangements. In short, some taxpayers did not have access to adequate levels of tax assistance, while others were able to obtain excessive tax assistance.
The new single comprehensive limit on contributions, namely 18 per cent of earnings, will apply to all tax assisted savings in all plans. The new system will better integrate RRSP and registered pension plan contributions. It will be more flexible and will enable taxpayers to tailor the pattern of their retirement savings more closely to their financial needs.
In conclusion, we should indeed address the needs of Canadians with incomes which fluctuate from one year to another, but tax reforms combined with the substantial income deferral possibilities provided by the new system of tax assistance for retirement saving does indeed address these very needs.
It does so indeed more fully and more fairly than would the reintroduction of complex averaging measures.
Mr. Francis G. LeBlanc (Cape Breton Highlands -
Canso): Madam Speaker, I would just like to say a few words on this motion on behalf of my party.
Really, they are more in the nature of personal reflection on the concept of income averaging and the taxation of income averaging. I must confess to not having had a great deal of time to think about this matter today, although it is an interesting subject and an interesting motion which the hon. member for Mackenzie has put before the House.
October 3, 1991

It is one on which I would have preferred to have a little more time to give some careful reflection to. However, I would just like to say a few things from the perspective of two of the income groups that are prominent in my riding and for whom this system of income averaging would be relevant, that is to say, the fishermen and the farmers.
Certainly, in the case of fishermen, their income fluctuates every year with the catch and the success of their catch. In the case of the farmers, it is the same story with their incomes dependent on the weather conditions, on the price of their product and on all sorts of factors over which they have no control. Certainly a form of averaging of income which would allow them to plan further ahead would be advantageous to both those income groups.
It is really a form of social insurance in the sense of allowing them to be compensated in the bad years by the income that they earned in the good years.
The questions that this system raises are many, particularly when they are thought about in relation to our system of progressive income taxation. In our system of retirement income, Canadians are given tax advantages for putting money away into RRSP and other forms of deferred income plans. In that sense, they are able to lower their taxable income in current years and only have to pay taxes on that income when they have lower income. In that sense, they are subject to a lower marginal tax rate.
This subject of income averaging has to be considered in the context of measures in the income tax system, particularly in terms of deferred income plans and the RRSP plans which allow people to defer their income to a future date. The five-year block averaging mentioned in the member's motion and his remarks in support of his motion lead me to ask the question: What is so special about five years? I could see, if we were to conduct some genuine tax reform, a system in which all income would be equally considered and one might be able to defer one's income indefinitely. Our tax rate might be something approaching what one of my colleagues has called a single tax, that is to say, a flat tax rate on income. The individual taxpayer would simply be able to choose how much income he would reserve for a particular year or
Private Members' Business
put the extra income in a plan of some sort for future years for future purposes. He would only pay taxes on it when that income was withdrawn in the form of annuity like an RRSP.
I could see a system extended beyond that to allow, for example, individual taxpayers to plan for future education and retraining possibilities down the road. They would be allowed to take income from a good year and put it aside into an education plan or some form of savings account that would not be subject to tax in that year. Later on perhaps, if there is a change of career or need for retraining, that income would be there to be drawn upon. They would not pay high tax rates on it in the year they earned the income.
The idea of averaging income over a longer period than a year certainly has merit, provided it is part of a more comprehensive set of tax reform proposals. I would include in that a movement toward something I would call a single tax. For people in many income categories it also has to be related to some minimum level of income and perhaps, some form of guaranteed annual income, minimum tax or some level of minimum income which people could have without having to pay taxes. We have something similar in the current system, which is often subject to many inequities because of the complicated nature of our income tax system.
I would have preferred to have more time to give this matter some structured thought. I believe the principle of the motion has merit. It is the kind of thing one wants to examine in the context of many other facets of the income tax system which is very, very complex. I would submit that it is far too complex and a source of great frustration for many Canadians.
The government's tax reform proposals which involve the closure of some of the brackets in our progressive income tax system go part way to simplifying the tax system. There are still many loopholes, tax expenditures and kinks in the tax system which favour the well-to-do and which favour those Canadians who have a persistently high income. They can employ the services of accountants to take advantage of these loopholes and thereby escape taxation and impose a higher burden of taxes on the rest of the population including those very individuals the member for Mackenzie would like to help with his block averaging proposal.

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Private Members' Business
I would submit that the way to true tax reform would involve a form of averaging over a longer period of time than a year, but it would also involve many other components including a movement toward a far simpler system of tax rates and a more comprehensive base. It would be an income tax system which would eliminate many of the loopholes that still exist in our income tax system. It makes that system far too complicated and ends up creating many inequities for Canadians. It creates distortions and disincentives for all sorts of things and that in the end weakens our economy. It also creates all sorts of problems of fiscal management for the government.
It is an interesting idea. It certainly benefits income groups like the farmers and the fishermen, but it would need to be studied more carefully and would need to be incorporated with other sorts of tax measures such as those that I have described.


Alan Redway: Madam Speaker, I am pleased to have the opportunity for a few moments this evening to comment on the hon. member for Mackenzie's proposition before the House:
That, in the opinion of this House, the government should
consider the advisability of introducing amendments to the Income
Tax Act so that taxpayers whose income may fluctuate from one year
to the next would be able to average their income over five years.
I have been most interested in the comments that various members have made this evening with respect to our tax system and with respect to this specific proposition. I think two comments stand out especially in my mind: first, that the tax system should be a fair one and, second, that the tax system should be a simple one, as simple as it possibly can be.
You and I are well aware, Madam Speaker, that the tax system we have in place today, in spite of all of the efforts to simplify, improve and reform it, is anything but simple. You and I just have to pick up our income tax return form as we are required to do each year, take a look at it, see what if anything we can make of it and how long it is going to take to fill out, to know that it is a very complex system indeed.
Many of my constituents come to me regularly and tell me that when they started paying income tax the return was one simple page. Not only have I seen those forms, but I am just old enough to have filled in a few of those myself years and years and years ago when the income tax return was one simple page.
We have made it more complex every year and every year in this House, sometimes several times a year, we debate further income tax measures, we pass further income tax legislation, and each year it becomes more and more complex.
I recall many people over the years advocating a simpler system, the single tax system.
We recall the campaign of one Mr. Peter Pocklington across this country in 1982-83 leading up to the leadership convention that took place in this city which chose the now Prime Minister of our country to be leader of the Progressive Conservative Party. One of the candidates in that campaign was Mr. Peter Pocklington, who campaigned virtually on a single issue, the issue of a simple income tax form, a one-page tax form, a flat tax form. It was a very popular issue and Mr. Pocklington, at least for a while, became a very popular figure in the country, at least until he decided to trade away Wayne Gretzky to the United States. He became a very popular figure in this country on the theory that we should make the system more simple than it is now.
One of the members of this House says I think he has written a book on it now. The hon. member for Broadview-Greenwood, one of my neighbouring ridings in the city of Toronto, has another proposal out on simplifying the system, on a flat tax, getting back to the basics.
All of those proposals, it seems to me, make a good deal of sense but they do conflict with concepts like the one that has been put forward by the hon. member for Mackenzie and so many other concepts in our Income Tax Act. What the hon. member is proposing is not really something that will make the system more simple and straightforward but will bring back a complexity to the system that we had previously.
I am not sure if I am correct, and my mind may be a little foggy on this, but it seems to me that income averaging in the income tax system probably came about back in the 1970s following something called the Carter commission on taxation. My hon. friends say it was 1948. In any event, I remember that in 1970 there were further attempts to reform the income tax system as a result of the Carter commission and the so-called Benson budget, if you will recall, that of then Minister of Finance Edgar Benson. He did a lot of things at that time to try to make the system a fairer one. He brought in things like capital gains tax. He eliminated things like the estate tax. Now we hear that maybe the estate tax would be a fairer way to tax and maybe we should bring it back, rather than leave it in the junkyard con the scrap heap.
October 3, 1991

There have been other attempts, as I have indicated, at tax reform in the past. The latest attempt back in 1987-88 did away with income averaging in the income tax system. Now we have another suggestion for bringing it back. I do not think it meets the criterion of simplicity, even though it may be helpful with respect to the criterion for fairness. It certainly does not help to make our tax system any more simple than it is now. In my view, by bringing it back it would only make it more complex. In the days when we had income averaging in the Income Tax Act we either had to rely on a chartered accountant to figure that out for us or maybe even the tax department itself. We were often at its mercy in making out what was quite a complex calculation and one that if we did try it ourselves usually was wrong.
We are left then, it seems to me, with the other criterion when examining this proposition, and that is the criterion of fairness. Certainly it would seem anything but fair to people who have income that goes in peaks and valleys to have a tax which impacts on them at different tax rates, one sometimes at a higher tax rate when their income is a way up, sometimes at a lower tax rate or perhaps even nil when their income is a way down.
The possibility that their income may be so low that there is no tax payable at all was another issue of concern raised in this House for some period of time by our colleagues in the NDP, and to some extent I suppose with respect to corporations they are still raising that concern. They did raise the concern that at the low end of the scale, at least, all people should pay tax and there should be no way of getting out of it.
As a result of the concerns they brought forth and as a result of reflection and study on the part of the government, the minimum tax was put in place and is in place today to eliminate that concern and to make it fair.
I am sure the hon. members who are murmuring and nodding their heads in approval on the other side of the House will agree that the present government has made very substantial strides to tiy to make the tax system a
Private Members' Business
fairer one by eliminating an awful lot of those tax loopholes that have been referred to and by trying to make it fair.
Just one complex loophole that I can recall, having had a good deal to do with it, was the scientific tax credit which opened up a gigantic sieve in the system and fortunately that has been eliminated.


An hon. member:: Who introduced that?


Alan Redway: My colleague asks who introduced that. He knows and I know that it was the former Liberal government that introduced that. Virtually every one of the tax loopholes that are in the Income Tax Act and other tax loopholes were introduced by previous Liberal governments over many, many years.
They did it to try to provide some incentives for people to get into scientific investment and research and all of the rest. They did it in good faith and I certainly do not quarrel with the motives. It did not help to create a fair system. Certainly what we should be doing is trying to create a fair system, but at the same time balancing it off with the basic need of the tax system which is to try to make sure that we have enough money to pay the bills that all of us want to pay.
I have listened to our colleagues on the other side this afternoon talking about helping our farmers in this country, a very noble proposition and something that I wholly agree with. They know and I know that somehow or other, if we are going to do that, we need to raise the money to do that and that is raised through the tax system.
While the tax system has to be fair, it also has to make sure that we raise the money not only to look after people like our farmers and our fishermen and all of the other people we need to look after in this country, but to look after something called our deficit and our national debt which they keep reminding us are enormous.
Certainly we are all searching for a system that is simple. We are all searching for a system that is fair. I think the debate this afternoon on this proposition has helped that process. I applaud the hon. member for bringing forward the bill for our consideration.

October 3, 1991
Private Members' Business


Lise Bourgault: Madam Speaker, I would like to congratulate the hon. member who just made a reference to the scientific research tax credit. Something like $2 billion went down the drain in that program. Imagine if we had that kind of money today to help our farmers! I remember one project in particular, the Dream Street Holstein. An enormous amount of money was spent on research on black and white Holsteins and brown and white Holsteins. It cost a fortune. If we had that money today to help farmers in Western Canada, it would be fantastic.
Madam Speaker, I welcome this opportunity to speak to motion M-81 introduced by the hon. member for Mackenzie. The hon. member asks the government to consider the advisability of amending the Income Tax Act so that taxpayers whose income may fluctuate considerably from one year to the next would be able to average their income over five years.
The payment procedure proposed in this motion is almost identical to the provision for averaging the income of farmers and fishermen over a period of five years, a provision that became part of the Income Tax Act in 1946 and was dropped in 1988 as part of our tax reform.
This provision, Madam Speaker, allowed individuals whose chief source of income was farming or fishing to average their income over a five year period. When their income fluctuated substantially from year to year, this procedure made it possible to reduce the total income tax payable over the five year period in question. Averaging was intended to lessen the fiscal impact of substantial fluctuations in the income of farmers and fishermen, more likely to be affected by such fluctuations as a result of drought, disease or price swings.
Today, this is a very common concept, and I think the hon. member for Mackenzie realized that when he introduced his motion, which is entirely appropriate, considering what is happening toda-at GATT they are discussing article XI, and the subject is very much in the news.
However, Madam Speaker, this particular provision of the 1946 Income Tax Act was used by a mere 4 per cent of farmers and fishermen. Only 4 per cent took advantage of this provision. It was a difficult mechanism to comply with and administratively very complex.
With fewer tax brackets and lower tax rates, incomeaveraging measures became less necessary and were abolished in 1988. This also helped simplify the tax
system, which was obviously one of the main objectives of that reform, Madam Speaker.
Averaging was supposed to give some protection to farmers and fishermen whose income is particularly prone to large variations from year to year. Even though this measure was intended to lessen the impact of such fluctuations, it had mixed success, witness the low participation rate I mentioned earlier.
The government still continues to take account of farmers' vulnerability to fluctuating income. That is why, in early 1991, it announced new measures to help them: the Gross Revenue Insurance Program and the Net Income Stabilization Account.
GRIP, the Gross Revenue Insurance Program, is meant to protect farmers' income. It is based on the existing crop insurance plan and adds income protection to it. Farmers can thus count on an assured gross revenue that will not be affected by natural risks or market forces beyond their control. GRIP also enables farmers to calculate the guaranteed return of each crop in the early spring and obtain operating funds as required.
Under the Net Income Stabilization Account, commonly called NISA, farmers and the federal and provincial governments make equivalent payments into individual accounts. Farmers draw on these accounts when their income is low. The interest earned is only taxed when it is withdrawn from the account.
The close cooperation, Madam Speaker, between farmers, the provinces and the federal government that led to these mechanisms is a very important feature of them. When he revealed the terms and conditions of these plans, the Minister of Agriculture declared that this program was designed from scratch by the farmers themselves, the provinces and the federal government as part of a policy review. This is a unique case in public policy development. Together the interested parties set up a whole new program to reduce the need for special assistance every time. The new support measures provide assistance to farmers in all regions of the country equitably and encourage the adoption of sound management practices based on long-term market trends.
I think it is imperative that we collectively recognize this is the type of partnership we must look for, not only in the agricultural sector but in other sectors as well. Governments cannot go it alone any more; they need the input of the various stakeholders.
Members of this House know that Quebec maple syrup producers have come to us asking for $22 million in special assistance. Based on the number of maple syrup producers in Eastern Ontario and in Quebec, for the

Ozmost part, I figure this would represent around $17,000 or $18,000 for each of them. That is a lot of money in times of economic restraint, and I think these new programs will help them pull through.
Madam Speaker, we can see better the level of cooperation between the various stakeholders if we take
a look at what went before the implementation of these measures because extensive consultations have been necessary to formulate such policies.
I can see that my time has run out. Thank you for having recognized me again.
Private Members' Business


Madam Deputy Speaker:: The hour provided for the consideration of Private Members' Business has now expired. Pursuant to Standing Order 93, the order is dropped to the bottom of the order of precedence on the Order Paper.
It being seven o'clock, this House stands adjourned until tomorrow at 10 a.m., pursuant to Standing Order 24(1).


[Stage Direction]
The House adjourned at 7 p.m.
[Stage Direction]
Friday, October 4, 1991