1992-02-18

Mr. Tom Wappel (Scarborough West):: Mr. Speaker, I rise on a point of personal privilege.
I read an article in the January 27, 1992 issue of the Western Report on the subject of paedophilia and incest. In that article certain so-called academics offered their views that incest and paedophilia were perfectly acceptable.
Its contents so disturbed me that I felt compelled to bring it to the attention of members of Parliament and senators as I have done in the past in relation to other issues. The next day I wrote a short letter and attached a copy of the article in question. I asked members to read and reflect on its contents; no more, no less.
In the intervening days it has become apparent to me that my letter has been misinterpreted by some. Meanings have been attributed to the letter which I did not intend. I regret that I may have in some way offended some members and senators or members of the public. I am dismayed that I was not able to articulate myself in a manner which was clear to my fellow parliamentarians.
I did not state, I did not intend to state, nor did I intend to imply that homosexuals are child molesters. I do not equate paedophilia with homosexuality. There are heterosexual paedophiles and there are homosexual paedophiles. In fact the criminal mentioned in the article had assaulted children of both sexes.
In conclusion, let me say that I regret the pain any misunderstanding I may have caused any person in this Parliament or outside it. I feel for the plight of all of those in distress in our society.
Thank you, Mr. Speaker, for giving me this opportunity to make this statement.



ROUTINE PROCEEDINGS


Mr. Albert Cooper (Parliamentary Secretary to Minister of State and Leader of the Government in the House of Commons):: Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government's response to 30 petitions.
[Editor's Note: See today's Votes and Proceedings.]


PETITIONS
Mr. Nelson A. Riis (Kamloops):: Mr. Speaker, it is an honour and a privilege to present a petition on behalf of a number of residents of Blue River, Birch Island, Clearwater, Vavenby, Little Fort, as well as the rural areas of the North Thompson Valley. This is now the 67th petition I have presented in the House of Commons on this issue.
The petitioners pointed out that Multinational Resources, a company on the Vancouver Exchange, has announced its intentions to dam the North Thompson River at Valemount and divert part of the water into a number of trenches and canals in order to sell the water in the San Diego, California region.
They point out that this is one of the many proposals such as the Nowapa Plant to divert Canadian rivers into the United States and northern Mexico. They are asking

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that the Government of Canada state categorically that we will not permit our fresh water to be dammed and diverted into the U.S. and state very clearly to the United States authorities that Canadian rivers are not for sale.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk)
Albert Glen Cooper: Mr. Speaker, Question No. 194 will be answered today.


Mr. Saint-Julien: Did Radio-Canada employees travel to Paris in November 1991 to attend the Sommet de la Francophonie and, if so, (a) how many employees went and who were they, (b) how much did lodging cost for each employee, (c) how much did air travel cost for each employee and what class did they travel on (First, Business, Economy), (d) how much did car rentals cost, (e) how much did food cost, (f) what was the cost in overtime, (g) what was the total cost of the event paid by Radio-Canadal


Hon. Henry Perrin Beatty (Minister of Communications):: This matter has been brought to the attention of the Canadian Broadcasting Corporation (CBC). We are informed as follows:
CBC Societe Radio-Canada covered the Sommet de la Francophonie in its entirety between November 16 and 23, 1991. Coverage of the Sommet included specials, radio and TV news reports, analyses and interviews with experts on current affairs programs. Furthermore, the material accumulated during the coverage was used to feed public affairs programs on televison and radio.
(a) The French radio network used six persons for all its programming (news and news specials, current and public affairs) namely:
The main host (anchorman) for special programs and joumalist/presenter for major radio newscasts, a coordinator to look after sound material and report needs, a producer, a reporter in Ottawa, a parliamentary reporter form Quebec City and, finally, the host of Les Actualites.
The French televison network used 20 persons for specials and information programs. They were:
From Montreal: the host of Telejoumal, two producers, a production assistant, a journalist, a researcher, a technical director and a camera operator; from the London office: a producer, a correspondent, a camera operator, a sound person and an editor; from the national Ottawa office: a journalist, a camera operator, a sound operator and an editor; from Quebec City: a journalist; form Winnipeg: a producer and a technician.
(Ib) Parliament has not, as a matter of custom since the corporations's creation in 1936, required CBC to supply, in answering Parliamentary questions, certain details of its internal management and administration. Parliament has had two reasons for following this custom: 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 when the CBC has suggested that such information should not be made a matter of public record, its views have been accepted by them. The names of employees and their functions in relation to specific programs, their salaries or expenses, the costs of individual programs, or business arrangements are examples of details which it has not been customary to require the CBC to supply. It is open to Parliament and its appropriate committees to discuss the policies and the CBC have followed in this regard.
(c) All these CBC /Societe Radio-Canda employees travelled economy class, with the exception of two employees who travelled business class to Paris and returned economy class. Their departures, scheduled originally for November 13 and 15, respectively, were delayed until Saturday, November 16, because of the special program on the funeral of Cardinal Leger.
For travel costs, see response in (b) above.
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(d)	No cars were rented. However, the television crew rented a van with a driver for the duration of the Sommet.
For the rental costs, see response in (b) above.
(e)	See response in (b) above.
(f)	See response in (b) above.
(g)	See response in (b) above.


Mr. Speaker:: The question as enumerated by the parliamentary secretary has been answered.


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


Mr. Speaker:: Shall the remaining questions stand?


Some hon. members:: Agreed.


Hon. Roger C. Simmons (Burin-St. George's):: Mr. Speaker, I would like to request an emergency debate on the issue of the unfolding disaster in the Atlantic fishery. I make my request under Standing Order 52.
Your Honour will be aware that we are facing a crisis of unprecedented proportions with immense implications for jobs and so on. I hope you would find it possible to grant my request for a debate under Standing Order 52.


Mr. Speaker:: I have of course been paying attention to this matter. The hon. member has indicated to me, as he is required to do, that he wishes to raise this matter. There will be a debate on the issue tomorrow night commencing at eight o'clock p.m.



GOVERNMENT ORDERS


Hon. John McDermid (for the Minister of Finance) moved: that Bill C-56, an act respecting the control of government expenditures, be read the second time and referred to Legislative Committee E.
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He said: Mr. Speaker, I am pleased to have the opportunity to speak at second reading of Bill C-56, the spending control act.
The motion today is a very important one. As the Minister of Finance and I have pointed out on a number of recent occasions, the pre-budget consultations we had with organizations representing every sector of Canadian society have had one clear and consistent focus, that is the strong desire among Canadians for continued spending restraint by government, a lower deficit and greater assurance that taxes can be kept within bounds in the future. In those pre-budget consultations that is what came from every group from all walks of life. With this measure that we are debating today on second reading, we are responding to that firmly and clearly expressed desire by Canadians.
I would like to explain briefly what the spending control act will do and to place it in the context of the government's comprehensive plan for economic recovery. As hon. members are aware, the government announced its intention to introduce mandatory legislated spending limits in the February 1991 budget and draft legislation was released last summer.
The Standing Committee on Finance of this House conducted extensive public hearings on the draft bill and then its report came forward with a number of recommendations. I would like to take this occasion to thank hon. members of all parties for their useful consideration of the finance committee's study of the bill and to thank the many Canadians who appeared before that committee to offer their views and to give advice to the Government of Canada.
I might say as an editorial comment that it may be wise for the government and for the opposition parties to take a look at the possibility of pre-examining bills more often. It probably produces better legislation and much better debate in the House of Commons. This bill is an example of that, because we have made some changes as to the suggestions of the committee and witnesses who have appeared. We had an opportunity to air this bill before it was brought back to the House in its present form.
As I said earlier, the spending control act is a vital part of the government's commitment to build a stronger Canadian economy by controlling the deficit and the heavy burden of the public debt. The act will limit federal government program spending through to the year 1995-96, and this means all spending except for major self-financing programs and interest charges on the public debt to the levels set out in the fiscal plan brought forward in the February 1991 budget.

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I want to emphasize that this is not a stand-alone measure. The spending control act will reinforce the government's expenditure control plan introduced in the 1990 budget and now being extended into the mid-1990s. It will work with the debt servicing and reduction account, which will receive all net revenues from the goods and services tax to ensure that our medium term deficit and debt reduction goals are achieved.
In my work in my riding and across this country I have heard from countless Canadians who have said that the debt servicing and reduction account is a very important thing, that the goods and services tax money must go into that fund, which it is by legislation, and be accounted for to the people of Canada. That is going to happen. Although people do not like the goods and services tax-no one likes taxes-they will feel somewhat better about it if they know that it is in fact going toward fighting the deficit.
All these measures will reinforce and be reinforced by another key initiative, that is the setting of low inflation targets that are helping to reduce inflation, and as a result bring interest rates down. This act will assure the fiscal restraint that is essential to keep our inflation targets in line. We are not only meeting our inflation targets but in fact doing much better than was projected. This in turn is the key to durably lower interest rates that will encourage investment, sustainable economic growth, and job creation.
I am pleased to note that the crucial importance of reducing the public debt as a share of our national income is supported by the Standing Committee on Finance.
In the 15 years before this government took office program spending had been increasing at an average annual rate of 13.8 per cent, or nearly 6 per cent after discounting for inflation. As a percentage of the economy, program spending rose from 14.8 per cent in 1968-69 to 19.6 per cent in 1984-85, a higher level than at any time since World War II.
We are now paying the price for these free-spending years. The increase in program spending during this period is the major factor behind the high annual deficits and the build up in the public debt that limits our room to manoeuvre today. That is why from the outset we have
given first and continuing priority to spending restraint in controlling the deficit.
Between 1984-85 and 1990-91 program spending increased by only 3.6 per cent per year, well below the rate of inflation for that period of time at 4.4 percent. We have cut program spending in real terms. As a percentage of the economy, program spending is back down to 16 per cent, a level that we have not seen in 20 years.
This restraint in program spending has been the major factor that has allowed us to achieve a turn around in the government's operating balance from an operating deficit of $16 billion in 1984-85. In other words, we borrowed $16 billion just to pay for programs of that day in 1984-85. That has been turned around today so that we have a surplus of $11.9 billion in 1990-91. In other words, we are collecting almost $12 billion more than we are spending in program financing.
It is important to note that more than two-thirds of this improvement in the operating balance as a percentage of gross domestic product is due to restraint in program spending.
As a result of the turn around in the operating balance, every dollar of our current deficit simply goes to pay interest charges on the public debt. It is not lost on Canadians, I might say, that these are dollars that could otherwise be used to ease our recovery from the recession, to fund desirable programs or most important for Canadians, to reduce taxes.
Although some members of the finance committee seem to question the need for this legislation, the majority of witnesses supported the view that continuing firm control over expenditures is essential to ensure that the deficit is reduced and the public debt declines as a percentage of the economy.
The spending control act will give Canadians the assurance that Parliament shares this view and will demand continuing discipline from the government.
The act breaks new ground by providing an important new mechanism to reinforce and if necessary to enforce the kind of spending restraint that Canadians want.
The allowable limits will be the program spending projections in the February 1991 budget. With limited exceptions, overspending would have to be offset by a program of spending reductions. Neither increased bor-
February 18, 1992

rowing nor tax increases would be allowed to make up for any excess spending.
If spending limits are exceeded, the Minister of Finance must announce before or in the next budget how the excess would be recovered. A budget that is not consistent with the spending control act could not be presented unless at the same time legislation is presented to amend the act.


Mr. Milliken:: Exactly.


John Horton McDermid: I'm glad my friend from Kingston and the Islands agrees with that.
These provisions provide for considerably tighter control of spending than comparable legislation in the United States, either the 1990 Budget Enforcement Act or its predecessor, the Gramm-Rudman-Hollings act. I would like to now discuss our responses to the finance committee's recommendations. I think this is very important.
The committee recommended, for example, that the spending control act should be subject to suspension by a vote of Parliament during a period of economic downturn or recession, or on presentation by the Minister of Finance of a projection of a downturn or recession.
However, the government does not believe that such an amendment is necessary. Under our parliamentary system the proposed act does not and cannot override the supremacy of Parliament.
The spending control act may be amended at any time in whatever circumstances Parliament deems appropriate. I would add that history has taught us that governments cannot spend their way out of recessions. This certainly was the lesson of the early 1980s.
I must say once this act does take force and becomes legislation that any government that would come in and amend this act would have to have some pretty good reasons to do so in presenting it to the Canadian public. It would have to be able to explain very clearly why it would be amending this act.
The way to stimulate economic activity is to maintain tight spending controls. There is no question about that.
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The message we got from groups and individuals across this country was: "For heaven's sake maintain your spending up there. Maintain that tight control on spending". It will return the fiscal position to a better balance, allow interest rates to decline, and keep present and future tax burdens down.
In any event, the spending control act does not constrain the main economic stabilizer in our economy, the unemployment insurance account.
The committee also recommended that the government establish very strict criteria to define the concept of eligible self-financing programs under the act. We believe the definition of self-financing is well established and full accounting is already provided in the public accounts.
Nonetheless, to provide greater assurance we have decided to specifically limit the number of self-financing programs that will be exempt from the act to the four proposed in the draft legislation. They are the unemployment insurance account; our farm insurance programs; the agriculture commodity stabilization account and the crop reinsurance fund; and the Gross Revenue Insurance Program.
On the other hand, we cannot accept the committee's recommendation that the major transfer of programs to the provinces should similarly be exempt.
Taken together the three major transfer programs, Established Programs Financing, equalization, and the Canada Assistance Plan represent 20 per cent of program spending or $23.1 billion in 1991-92.
To exclude these transfers from the spending control limits would seriously undermine the credibility of the act itself and this we propose not to do.
It might be interesting to know that if we exempted the transfers to the provinces the bill would only cover 65 per cent of program spending when in fact with the provinces it covers 85 per cent of program spending.
In another area the draft bill provided that any overspending in one year could be made up in future years covered by the act.
The committee, however, felt that this was too open-ended and recommended that overspending in any one year be required to be made up in the following year.

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While this may be desirable in theory, a one year catch-up rule could be quite disruptive for fiscal planning and operations management.
Instead, we have amended the act to require catching up within two years. This will ensure greater certainty without jeopardizing operational efficiencies and is a fair compromise to the committee's recommendation.
Another recommendation of the committee concerns the role of the Auditor General.
The committee recommended that he should specifically be given responsibility to monitor and report on the government's compliance with the act.
The committee suggested that this was all the more logical since the Auditor General had already been asked to audit and report on the proposed debt servicing and reduction account act.
To ensure consistency with the debt servicing and reduction account act, the government is prepared to clarify the role of the Auditor General in the case of the spending control act.
Accordingly, the revised bill will require that the government report on the act in the Public Accounts of Canada and to ask the Auditor General to report on the government's compliance with it.
Finally, there is the question of what happens after 1995-96 when the spending control act would normally expire.
As I have already indicated all overspending will need to be recovered under a two year catch-up rule. As a result if the government is in violation of the act in 1995-96, the government will have to indicate how this overspending will be recovered over the following two years.
In addition, the draft bill has been changed to require the Minister of Finance in the 1994 budget to recommend whether the act should be extended beyond the 1995-96 fiscal year.
As hon. members will see when they examine Bill C-56, we have also made a number of more technical changes in the draft bill to meet the finance committee's suggestions.
I am confident that the spending control act is a strong step forward that will help to put the Canadian economy back on the path to renewed and sustainable growth.


Peter Andrew Stewart Milliken: It is a waste of time.


John Horton McDermid: I hear my friend from Kingston and the Islands saying that it is a waste of time. This is typical Liberal philosophy that controlling spending is a waste of time. That is exactly what the Liberal opposition is saying. That is what the NDP is saying, that it is a waste of time to control spending.
I want the record to show that because our government has done a pretty good job of controlling spending. This will assure that ministers of the government stay within the spending control limits set which are at the 3 per cent level. It is very, veiy important to get government spending under control.
That is what the Canadian people want. That is what they deserve and that is what they are going to get from this government.


Mr. Mills:: They want to work.


John Horton McDermid: I hear my hon. colleague for Broadview-Greenwood saying that they do not want government spending controlled. This government is determined to control its spending. This bill will do it in conjunction with the deficit reduction and the debt removal act that we have in place. I think the hon. member supports that as well.
Living within the limits will require difficult choices among competing spending pressures. There is no question about that.
The ministers will have to make up their minds where the priorities are and they will have to within their responsibilities and within their limited budgets spend more wisely. That is very important.
Spending more on some things will mean spending less on others. Those are decisions that are going to have to be taken. Since coming to office the government has repeatedly faced and made these kinds of choices. It will continue to do so as an essential part of facing up to Canada's fiscal and economic challenges.
I urge that the House support the spending control act, Bill C-56, assure its speedy passage so that we can
February 18, 1992

get on with controlling the spending of the government of Canada which is very important in our fiscal planning.


Hon. Herb Gray (Windsor West):: Mr. Speaker, one must ask is this really a bill to control government expenditures? Or, is it instead a measure intended to try to convince Canadians that this Conservative government is something it obviously is not and that is a good manager of its own and this country's affairs.
As I said when this measure was first outlined in a discussion paper last July, this proposal is really nothing more than cosmetic. It simply puts into legislative form what the government should be doing anyway. That is working to live within its own budgetary projections.
This is the government that boasted before the current recession began that it was deliberately inducing a slow-down. These were the very words of the Prime Minister. As the Conference Board of Canada confirmed, this government deliberately created our first made-in-Canada recession through high interest rate and high dollar policies.
This government gave us the GST hitting at consumer confidence and consumer spending. In doing so it has deepened and prolonged the recession. This government came into office pledging to reduce the public debt but it actually doubled to $400 billion since 1984 when this government was first elected.
The high interest rate policies of the Bank of Canada that this government supported and agreed with added billions to its own borrowing costs and therefore to this government's expenditures and made its debt and deficit problems worse and not better.
This government's cutbacks of its transfer payments to the provinces really transferred its deficit problems to them and this has been weakening our health, education and social welfare programs, programs essential to the well-being of Canadians and the well-being of the economy.
Now the government is saying it needs legislative authority to keep its spending to the cumulative total outlined in the legislation over the five-year period between fiscal 1991-92 and fiscal year 1995-96.
If the government was effectively running, effectively managing, its own administration, why does it need this
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legislation? Is it saying the cabinet ministers and their senior officials are not living within the expenditure framework set by the Minister of Finance in his budget? If that is the case, why does the Prime Minister not simply fire them? He obviously has the authority to do so.
We have a parliamentary system with a Prime Minister and cabinet, the government, being in office because it is supported by a majority of the members of the House of Commons. Without that majority no government in a parliamentary system can stay in office. There is not here the separation of the legislative and administrative branches of government with the possibility of conflict between them and the separate spending decisions by the legislative branch we see in the United States, a situation that led to the legislation in that country mentioned by the minister, and similar to what the government is proposing here.
The House of Commons finance committee visited Washington in the course of its study of the government's discussion paper that preceded this bill. The committee's report said, and I invite the House to look at paragraph 32 on page 7:
Many of the Americans contacted by the committee wondered why it is necessary to impose budgetary controls in a parliamentary system of government. After all, if a government is powerful enough to enact such controls, it should be able to control its own fiscal policy and any future government would not be bound by such controls since the enabling legislation could easily be amended. Such commentators noted that under a congressional system it was opposing and immovable congressional interests which led to budgetary controls in the first place, in particular, it was the conflict between the Congress and the administration which caused the Gramm-Rudman-Hollings Act and its successor, the Budget Enforcement Act, to be passed.
The committee report goes on in paragraph 35 to say:
Budget control legislation is a distinctly American approach to problems arising in a quite unique legislative environment. Just because the American system might meet such controls does not imply that the Canadian parliamentary system would necessarily benefit from the same approach despite the fact that both countries face similar fiscal problems.
By the way, the report was supported, including these quotations, by the Conservative members of the committee, where they have the majority.
When one considers these paragraphs from the committee report, no wonder I say this bill is cosmetic. Under our parliamentary system, this bill could be amended not only by the subsequent government that

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replaces the current one, it could be amended by this current Conservative government itself.
By the way, a few weeks ago the Minister of Finance admitted he was out $1.5 billion in his projections for the government's deficit for this year alone and said he was freezing all discretionary spending for the balance of this year to March 31 in the amount of some $200 million. He did not say he wished to do this, but he lacked the authority. He said the government was doing it. No public servant and no member of the public affected by this decision will doubt that this discretionary spending is frozen and no legislation was necessary to accomplish this.
If this legislation before the House for second reading is intended by this government to be taken seriously, if it has a serious purpose, then what is behind it? What does the government really have in mind. It could well be an attempt by this discredited Conservative government to try to impose its equally discredited right wing agenda on a subsequent government after the next election.
It is hardly likely the Canadian people will elect this government again after what they have seen of it, especially since the election of 1988. They have seen the effects of the free trade deal, the GST, the government's high interest rate and high dollar policies, its cutbacks in health, education and research and development, its negative impact on the CBC, VIA Rail and Canada Post; the government's unravelling of the very fabric of this country.
This bill is to apply for five years starting in fiscal year
1991-92. This is well after the life of this Parliament, well after when there has to be an election.
Why should a new government elected by the people who, in doing so, reject the policies of this government, have to live within the exact fiscal framework created by this government to carry out its own discredited policies?
This government, in a desperate attempt to try to win back public support, could spend money beyond the limits for each year set out in the bill. The bill says the government has to make up such overspending in one year by cutting back over the following two years.
If this bill is intended to have real impact it would mean a new government, elected as I said by Canadians
who have categorically rejected the current one, would be unable to proceed with the programs for which it was elected. It would be unable to move immediately to carry out those priorities. It would have to cut back to make up for the overspending by this government, carried out in an attempt to win back the support of Canadians in a run-up to the election.
Of course a new government could amend the legislation, but if this can be done let me ask again: What is the point of the legislation? What is the point of proposing this bill whose life goes beyond the life of this Parliament? As I have said, it covers a five year period. In presenting it, the government assumes its forecasts of government revenue, as well as its forecasts of the expenditures that would take place under its current programs, would be accurate. It also assumes that its forecasts of the state of the economy, as long as five years hence, would be accurate.
This government has shown a great deal of weakness when it comes to the accuracy of its economic forecasts, as demonstrated by the admission of the Minister of Finance in recent months and weeks how wrong he was about the level of unemployment and how wrong he was about the extent to which the economy would go into recession and the pace and timing of the recovery from that recession and the size of the government's deficit for the current fiscal year. If this government's forecasts are wrong, then the assumptions, the foundations on which the bill is based, will also be wrong and out of kilter and this bill could well harm the future growth and development of our economy.
The finance committee in its report on the proposed bill recognized this in one of its key recommendations. On page 25, the committee said, and I quote:
The spending control act should be subject to being suspended by vote of Parliament during a period of economic downturn or recession or upon presentation by the Minister of Finance of a projection of such recession or downturn.
Nothing like this appears in the bill before us. In fact, this recommendation has been rejected by the government.
We note there are exclusions from the controls and spending limits set out in the bill. One is the management of the public debt and its expenditure to meet the cost of borrowing. Another involves four self-financ-ingprograms, unemployment insurance and three others
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with regard to agricultural insurance, with the money being raised by special levies or taxes. Another exclusion refers to expenditures made as a direct result of an emergency.
The legislation does limit the government's ability to budget in a counter-cyclical way to offset through its expenditure and taxation programs the effects both of recession and of an overheated economy. The bill in fact would leave the operation of the unemployment insurance program as the government's chief counter-cyclical tool.
In the report I referred to earlier in my remarks, the committee quotes Professor Douglas Hartle of the University of Toronto as follows in paragraph 75:
Professor Hartle, on the other hand, while recognizing the need for spending restraint, views the controls program as little more than a public relations exercise. He concludes that the federal government's forecasts for future deficits are contingent upon declining interest rates, more so than program spending controls.
The report goes on to say:
According to Douglas Hartle, current tight fiscal and monetary policies have had perverse effects on the deficit by pushing up interest rates. This has increased the deficit directly and indirectly by hindering the recovery. Moreover, the proposed legislation does not guarantee lower deficits because such a result depends crucially on lower interest rates. These views are clearly in contrast to that of the federal government which sees fiscal and economic problems stemming mainly from the large federal deficit and debt by controlling that fiscal imbalance. Real interest rates should fall and economic activity expand.
We have seen interest rates falling over the past months, but so far we have seen little or no economic expansion. In fact, in spite of lower interest rates, the government's deficit is likely to increase this year due to lower government revenues and higher expenditures because of the recession this government's policies have helped create.
Another point is that this legislation does not exclude from its coverage, its restraints, its limitations, programs like the old age pension or the family allowance, unlike its American counterpart.
What happens under this bill if the government's forecasts about the amount required for the old age pension is wrong? What happens if more of the population becomes older and lives longer than forecast, creating greater need for expenditures under the Old Age Security program? Is the Conservative government saying in this bill it will cut back on the old age pension
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even if there are older Canadians who expect and need these payments? If it does not do this, what other programs will it cut back on instead? Air traffic control, inspection to ensure the safety of our food products, or exactly what?
The Leader of the Opposition in recent speeches set out five principles that would guide a future Liberal government. He spoke of restoring Canada's industrial strength, ensuring a fair tax system, creating comprehensive and creative adjustment policies, ensuring balanced economic growth and also being a truly fiscally responsible government.
In referring to figures from the Auditor General that from 1984 to 1991 the federal government mismanaged at least $23 billion, the Leader of the Opposition said a Liberal government, and I quote: "will scrutinize every single line item of spending. We will use it only to do the things which government can and should do".
Liberals are concerned about issues of government expenditure and deficits. However, as I said when I began these remarks, this proposal, this bill before the House, is really nothing more than cosmetic. It simply puts into legislative form what this government should be doing anyway, and that is working to live within its own budgetary projections.
I want to point out to those Canadians concerned about government expenditure and government activities that this bill does nothing to address those concerns, the concerns of Canadians about this government's waste, about this government's excessive taxes. In short, the government is proposing legislation to do what it already has the authority to do. The proposal is simply an attempt by this Conservative government to hoodwink Canadians into thinking that it is finally coming to grips with the negative effects of its own economic incompetence and mismanagement.
It is time for a government that is truly fiscally responsible, one that produces more than cosmetic measures, above all, one that does not slow down and damage the economy through its measures, one that takes into account the desire of Canadians for jobs, the fact that there are 1.5 million Canadians who are out of work. This government ignores these Canadians and the businesses that have shut down and want more than

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cosmetic measures from this government. They want a government that is concerned with the good management of itself and this country's affairs, one that helps rather than harms their basic existence.
It is time we had a government that, as the Leader of the Opposition put it, promotes growth and does not hold it down.
What about the effects of economic growth in reducing government expenditure for such things as welfare, and at the same time restoring government revenues without higher taxes from businesses whose earnings are restored and by having Canadians go back to work?
Canadians will look beyond the empty words of the minister today in proposing this bill and see the failure of this government to meet its own projections, and the failure of this government to help Canadians live better and more fulfilling lives.
More than this bill, Canadians want an election to give themselves a new and a better government. The best way to get a fiscally responsible government but at the same time a caring and compassionate one is not through this bill. It is to have an election to get rid of this very bad government.


Mr. Steven W. Langdon (Essex-Windsor):: Mr. Speaker, the bill which stands before us in the name of the Minister of Finance is a piece of proposed legislation which, if it had been properly put together and if the minister had listened to the unanimous report of the Standing Committee on Finance of this House, could have been a useful piece of legislation. It could have been a piece of legislation that in fact would respond to what many people across this country, many who talked to the finance committee during their hearings with respect to this bill, want to see.
Many Canadians across this country want to see a serious effort to deal with the deficit of this country. They want to see a serious effort to do that, and at the same time, to see that the expenditures which government makes and tax policy which government follows come together to provide us with a strategy to rebuild our economy, to re-establish jobs for Canadians, to get people back to work and to get them contributing taxes instead of accepting unemployment insurance. Thereby,
they want the government to see to it that we deal with the deficit.
For this bill to have achieved some of the purposes which I have talked about, purposes of controlling the ridiculous level of deficits which both Liberal and Conservative governments have created in our country and, second, to expand the number of jobs for Canadians which exist across this country from the very high unemployment levels which have been reached in this Conservative recession and the very high levels which were reached in the Liberal recession in the early 1980s, it would have been necessary for this government to listen, to listen first to the very finance committee of this House to which this bill was referred. Second, it would have been necessary for this government to listen to the many Canadians who testified before that finance committee.
I could take you, Mr. Speaker, and I could take people listening to this debate through many of the pieces of testimony which we heard in the finance committee. We heard, for instance, from the Canadian Federation of Independent Business. It said to us: "Small business owners and Canadians generally have lost confidence in the government's ability to manage its own affairs, let alone manage the country".
The Canadian Federation of Independent Business said: "As a first step in establishing some measure of credibility on the fiscal front, the government must impose upon itself a binding mechanism to ensure adherence to a sound expenditure control and deficit reduction plan".
I could quote from the Vancouver Board of Trade which spoke to us. Again, it stressed that even this small reduction in the deficit could be defeated if the assumptions of economic growth and interest rates turn out to be optimistic. "We think", said the Vancouver Board of Trade, "the assumptions err on the optimistic side".
I could take you through the testimony of the Business Council on National Issues, the Chamber of Commerce, the Canadian Manufacturers' Association. Business group after business group said: "The issue is dealing with the deficit". Yet, what do we have in front of us? We have a piece of legislation which does not, despite what I am sure you will hear from members on the government side, deal with the deficit.
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The finance committee of this House of Commons unanimously-that is all parties, including the Conservatives, the Liberals, the New Democrats-said it is important to get a handle on the deficit. They said further that the only thing which will make it possible is if there is control of tax expenditures.
There are many ways to spend money. You can spend money that goes out in the form of cheques to various people across the country. You can spend money that goes out in the form of grants to various companies throughout this country. You can spend money, and this is crucial, by making a deliberate decision to reduce taxes for a specific purpose or for a specific group within the economy.
If you are concerned about the deficit, when you make a decision to reduce taxes you have to do something else to offset that decision. You either have to reduce expenditures, not just limit the increase in expenditures, in order to make up for that giveaway of taxes which you provided or else, if you are going to, for instance, give a $100,000 tax exemption for capital gains to the wealthiest people in this country, if you are going to give that kind of tax loophole as this government has done, you have to make a decision that you will raise taxes in other areas, that the tax decrease you give to the very wealthy will be made up for by a tax increase in other parts of the economy. That is what has to be done if you are serious about reducing the deficit.
That is precisely the point. I quote here from the unanimous report of the finance committee with respect to this legislation: "Any legislated reduction in total tax revenue which causes the federal government's fiscal targets not to be met", in other words a tax decrease, "must be accompanied by measures offsetting this decrease through other forms of revenue increase or expenditure reduction".
That is the very heart of the recommendations which the minister praised in his speech as coming from the finance committee of this House of Commons. Yet that is the crucial recommendation which has been ignored in this bill. That is why this bill is a total sham. It does absolutely nothing to guarantee to Canadians that there
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is some kind of legislated plan to reduce the deficit in this country.
The Minister of Finance can come in on budget day, which we hope is coming soon, and say to the people of Canada: "I plan to reduce taxes for upper income earners in this country. I plan to reduce the level of taxation for the highest income earners by getting rid of the 10 per cent income surcharge on those making over $60,000 a year in taxable income". There is absolutely nothing in this piece of legislation which will stop that from happening. The result will be a significant increase in the deficit of this country.
You may say: "How could the government be so foolish? How could it be so stupid as not to listen to the unanimous report of its own finance committee?" I remind you that the finance committee report was unanimous. The majority on that committee is made up of Conservatives, people who actually do want to see the deficit reduced, but the government did not listen to them. You have to ask yourself why. Was it foolishness? Was it stupidity? I think not. I do not think this government is serious about reducing the deficit. This government simply wants to go through the motions. It wants to persuade Canadians, through some kind of cosmetic gesture, that it is doing something about the deficit when in fact all it is doing is burying the reality of waste, of deficits, of inefficiency in government which we have had for seven and a half years of Conservatives and before that for four and a half years of Liberals.
It is a process of waste, a process of inefficiency in government which has created a deficit of $420 billion that has been accumulated in our national debt. Out of every dollar that every Canadian contributes in taxes, 35 cents has to go to pay off the waste, extravagance and failure to deal with the deficit that is there on the part of this Conservative government for the last seven and a half years and the Liberal government before it for the previous four and a half years.
The only governments in this country that are taking seriously the need to control our expenditures and to meet social objectives to put people back to work, to therefore choose priorities, to stop wasting money, to stop the extravagance in government, are the New Democrat governments at provincial and territorial levels throughout this country.

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In Saskatchewan, British Columbia, Ontario and the Yukon Territory, we have governments which have made hard choices, which have said: "We cannot do everything, but what we will do will not be to the benefit of the rich, to the benefit of powerful corporations, but instead to the benefit of people who really need a tax break, to working people, to people with middle incomes who have been hammered so hard by this government and by the government before".
Just today figures have been released which indicate what has happened to the tax burden of people in 17 metropolitan areas across Canada which cover about 80 per cent of the population of Canada. If we go back to 1986, they paid just over 19 per cent of their incomes in taxes. Now they pay over 22 per cent of their incomes in taxes. That burden is not fair, it is not just, it has got to be dealt with. It is not being dealt with through this bogus piece of legislation. This bogus piece of legislation does not make the connection between expenditure control and reductions in the deficit. There is no connection between controlling expenditure and controlling a deficit.
Why? Because this government has rejected the unanimous report of the Standing Committee on Finance of this House. The only reason that we have to understand that rejection is that this government does not really want to deal with the extravagance and waste which it has created over the past seven and a half years of governing this country.
This bill has got to be beaten. This bill has got to be defeated. I hope Conservatives who are serious on the backbenches about deficit reduction in this country will stand up and defeat this legislation because it is a sham, a mockery that does not do what it sets out purportedly to do.
I urge this House to defeat this legislation because it is a cruel trick on Canadians across this country.


Mr. Pierre H. Vincent (Parliamentary Secretary to Deputy Prime Minister and Minister of Finance):: I think it is really too bad that the hon. member for the New Democratic Party should be so anxious to sing the praises of the NDP government in Ontario and brag about its
achievements because so far the results have not been outstanding. I think his comments are particularly unfortunate because they reflect his usual criticism of government legislation. He criticizes every single fiscal measure this government tables and has done so for seven and a half years.
The hon. member and his party have no positive contribution to make to this debate. They are always ready to criticize, but we have yet to hear any suggestion for dealing with the real problems facing this country.
When considering this bill, an act respecting the control of government expenditures, a bill that is absolutely relevant to the current situation in this country, we should remember that this measure was announced in the 1991 budget. There was thunderous applause in the riding of Trois-Rivieres and there was a wholly positive response when we announced mandatory legislated spending limits for the next five years. My constituents were delighted and told me: You are doing an excellent job of running the country's finances. We have an enormous debt we inherited from the Liberal government, and you are steering the right course to ensure we get rid of this debt.
This morning I heard my NDP colleague criticize the bill. I think we should look at the facts. Between 1970 and 1984, program spending increased by an average of 13.8 per cent annually. In other words, we had an annual increase of 13.8 per cent in program spending. From 1985 to 1992, the average annual increase was 3.7 per cent. This means that since 1984, this government has acted responsibly and run this country the way it ought to be run, with an annual reduction in program spending of 10 per cent.
Mr. Speaker, I am sure that you and I would have preferred to give more to Canadians. However, we have a job to do. We have responsibilities, which include managing the finances of this country and stopping the endless handouts that were typical of the Liberal government, which had programs to paint fences, shovel snow and wash windows. There were programs for just about anything. They did not create permanent jobs. All they did was spend, spend, spend.
In 1984, their legacy to us was a tremendous deficit of $39 billion and a national debt of $200 billion. That was their legacy, in 1984. That is what we got. I see this woke
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them up on the other side. They are upset. Never mind, it will do them good.
In 1984, the annual operating deficit-this does not include the interest on the debt-was $16 billion, which means that annually the Liberal government spent $16 billion more than it received in revenue. Show me a family or business in this country that would spend $16 billion more than it earns. We cut spending and yes, we raised income tax and other taxes.
No one will deny we raised taxes. But in what proportion? That is what matters. The proportion is 70 per cent cuts in government spending to 30 per cent increases in income tax and other taxes. Thanks to this medicine, which was not the most palatable and still isn't in 1992, the Treasury receives $12 billion more than the government spends every year, always excluding interest charges.
It means that this government managed a $29 billion turnaround within seven years. Twenty-nine billion dollars in terms of expenditures means that tomorrow morning we can forget about the national debt. It has disappeared. We have a balanced budget and no more deficit. We have money in the bank. But we still have a deficit, because we have to pay interest on a debt that neither you nor I created, Mr. Speaker, a debt that the party opposite ran up when it was in power.
Figure it any way you want, the Canadian government's annual deficit since 1985 is equal to the amount of interest payable on the $200 billion we inherited. Let an accountant figure it out. Whether they are CA, CMA, RIA or CGA, they will all get the same answer.
Our annual deficit now is due to the interest on a debt we inherited. We are meeting our responsibilities. One thing we are doing to meet our responsibilities is a bill that will limit spending and would require a minister who wants to exceed his allowed budget to present a bill amending the legislation that we will enact.
I think that requiring a minister to introduce a bill if he wants to change his department's operating budget is the
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best safety device we Canadians can have for the financial future of this country.
People often say that the government spends too much: too much on salaries, too much on rent, too much on travel, too much on this and that. Unfortunately, that is a perception. Since 1984, the costs of government have risen only 1.2 per cent, which in real terms is a drop of about 20 per cent.
We often hear comments about what Canadians think, that the government spends too much, and too often in the wrong places. The amounts can at times seem enormous, some things that are done may seem inane, but let us take any company in any field of activity and look at its balance sheet, its financial statements. I am sure that all Canadian businesses and all Canadian families are at least 1 per cent off their budget. One per cent of the money that the company or the family spent was spent unintentionally. They did not catch it in time. One per cent is not a lot. I am sure we could find examples everywhere, in families and businesses throughout Canada.
I tell these people to allow the federal government which is now in charge the same 1 per cent. One per cent of a $140-billion budget is $1.4 billion. As an administrator, I am ready to accept blame for $1.4 billion or 1 per cent of what is spent, which should not have been spent or should have been spent differently. Throughout the federal government, with all that it does, I can accept blame for this 1 per cent, although I think that if we who run the country wanted to eliminate this 1 per cent overspending, it would cost more than would be saved. Members of Parliament-not only Conservatives but members of all parties-would have to work 24 hours a day, seven days a week, just to check every expenditure of the federal government in 40 departments.
I think that we have to swallow the pill and live with it. But we must also consider the positive things that have been done since 1984. Cuts have been made and that hurt. Taxes have increased and that hurt. As a country, as members of the Conservative Party, as administrators, we have no choice but to run the government's finances so as to balance the budget in terms of income and outgo, and that is what we have done. It is now in place.

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We must also repay the huge debt that was left to us and on which interest is accumulating every day faster than we are paying it off. That too is our responsibility.
The bill before us must be seen in the global perspective of the financial responsibilities taken on by the Minister of Finance and by this government over the past seven years. That is what this bill is all about. I am convinced that opposition members will rise today and say that we should have spent more here, that we spent unwisely there. But judgment has to be exercised in dealing with reality here.
I am always prepared to discuss fully with my friends opposite the appropriateness of any government expenditure. But I am not prepared to discuss with them when they stand up every two minutes or so to ask for more money. They are asking for more money in every area of activity under the sun. They take a shot at everything they can without ever suggesting where the money should come from. Asking is easy-as Our Lord said: "Ask and you shall receive"-but this is Parliament, not the church. In that sense, I have nothing against the Opposition asking for money, but would they be so kind as to tell me at the same time where to find that money. In the taxpayers' pockets? Or should we cut a program and replace it? Where are we going to take the money they ask for?
That is the question I would like members opposite to ask themselves today before they rise in this House to speak against this bill-


An hon. member:: There is no substance in this bill.


Pierre H. Vincent: I see that they are waking up. At least we managed to wake them up a bit.
Before they start criticizing this bill, they should ponder on this because it is important. Members can be partisan, and I generally do my share at that, but this bill we are considering this morning represents an important part of what this party and this Parliament want for our country tomorrow morning and the next day as well as five and ten years down the road. That is what we should bear in mind as we debate this bill, how it should be seen.
Can we afford to keep running this country on a full credit card, charging maximum interest rates when we
can have another credit card? That is where we are at. That is the question we must ask ourselves when dealing with government finance in Canada in 1992: what can we afford to do to help the people of Canada while ensuring that our country will be in reasonably good financial health in the future? That is the question we must ask ourselves for very dollar that we spend.
In closing, I will raise a last point. In 1984, government operating costs represented 19.3 per cent of the total budget, compared to 16.6 per cent today. That is a 3 per cent reduction of operating costs over total government spending in 7 years. This means sound management in this House as well as in the government backrooms. It is important to emphasize this point because it shows that we have accomplished what we said we would do in 1984 and in 1988. It is important to emphasize this point because, as we are talking, Canadians need good news. They do not need a constantly pessimistic message like the one we hear from the opposition. Canadians need to see the light at the end of the tunnel. They need to see that their government takes action, that it makes decisions that are not necessarily popular, but that it knows what must be done for the country. Canadians definitely do not need to hear time after time, day after day, week after week, the members of the opposition talk about doom and gloom without ever giving a ray of hope as regards the economic and financial reality of Canada.
Mr. Speaker, you just informed me that my time is up. I hope that my colleagues will understand the underlying message of this bill, that they will support this legislation, that they will start to be positive and that they will bring to this House elements of solution and positive suggestions, instead of criticizing like they have now for seven years.


Hon. Bob Kaplan (York Centre):: Mr. Speaker, I have a question for the parliamentary secretary. He talked with great pride about the ability of his government to reduce the deficit and to face inherent problems. The member said that the time had come to seize the opportunity. If the government has that ability-and I remind him that his government promised seven years ago to eliminate the deficit-why has his government postponed its attempts for so long? Even if those attempts were un-

successful, why has the government waited so long after the promise it made during the 1984 election campaign?


Pierre H. Vincent: Mr. Speaker, I emphasized during my speech that this should not be a partisan debate. The question raised by my colleague is somewhat partisan. I will tell him again what I said earlier.
I said that when we were elected in 1984, the national debt stood at $200 billion. I said that if the member would look at the annual deficit under the Conservative government since 1984, the annual deficit for each year, and if the member would also look at the amount of interest to be paid on the debt that my hon. colleague created, since he was a member of the cabinet before 1984, if he would look at the interests on that debt, he would realize that, give or take $10 billion over an amount of $200 billion, which represents 5 per cent, it is exactly the same thing. This means that we have trouble paying the interest on the debt that we inherited. This is no secret; it is true and it is public knowledge. Yes, it is hard for us.
If we had not taken control of the affairs of the state and if we had not made all these cuts within the government and through tax increases, you can imagine what the debt would be right now. We would not even be able to write it on an 8 1/2 x 11 sheet, because there would be too many zeros. This is what I mean when I talk about sound management and finance control. Indeed, there is still a lot to be done, but a lot has also been done compared to what went on before 1984.


Peter Andrew Stewart Milliken: Mr. Speaker, I have two questions for the parliamentary secretary.
My first one is this: If it was such a good idea to table this bill, why didn't the government do this during the first year it was in power? Why wait until now?
My second question: The draft bill tabled before the finance committee contained a proposal for a 3 per cent annual increase in government spending. The government has changed the figures and proposes an annual increase of more than 3 per cent for every year covered by this bill. Why did the government raise these figures? Because it is unable to control spending? Why did the government do this?
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Pierre H. Vincent: Mr. Speaker, the hon. member's first question was why the government did not table this bill in the first year after it was elected. I would like to point out to the hon. member that we live in a country and a society that are developing very fast. Every day legislation is amended and new legislation is tabled before the House.
It is that philosophy that is also reflected in the budget. It is a philosophy that relates to the economic, financial and fiscal aspects of our country. The hon. member seems to be saying the bill is a good one. If it is so good, what difference does it make when he votes for it, as long as he does? I have no problem with that. Let him admit that this government drafts legislation that is good for the country, not because it is good for the Progressive Conservative Party or the Liberal Party or the NDP, because that is not the purpose of our debate this morning. This is not an issue that should be dealt with in a partisan manner. This is a matter of substance that should be addressed with arguments on substance, not petty partisan arguments.
His second question concerned the 3 per cent increase in expenditures. I may point out to the hon. member that there are 48 different ways to calculate government spending. What the bill proposes is different from what was provided in the draft bill, but conversely, the various expenditures included in the draft bill have been removed. We cannot compare apples and oranges, because it just will not work. That is more or less what the hon. member's question amounts to. He asked me to compare two things that are not quite the same. Since a number of spending categories were added later on, they cannot be calculated the same way.
I think the hon. member, who is usually quite brilliant, will understand this position.


Dennis Joseph Mills: Mr. Speaker, I just want to make a very short comment. I know the member would want to make sure that Canadians had a full understanding of the government's actions during the period of 1984 to 1992.
This deathbed conversion to expenditure control is really not going to wash. He failed in his address to mention that from 1984 until today the Conservative government has hit the people of Canada with over 32 tax increases, which amounted to just under $60 billion in

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additional revenue that the government had at its disposal. From 1985 to 1987 on the unemployment insurance draw there was close to $40 billion less than what we had from 1980 to 1984 because we were experiencing a recession. The member talked about having to service the debt. They had close to an extra $80 million to $90 billion of added funds that they could have used at their discretion.
I do not think the member can talk about having to service the debt they were left with without talking about the fact that they also took in an extra $80 billion in added revenue.


Pierre H. Vincent: Mr. Speaker, I just want to tell my colleague that he is wrong in saying that I did not inform the public properly. I said very clearly just now that 70 per cent of the $29-billion difference between 1984 and 1992 was due to less government spending and that 30 per cent was from higher taxes. I said so clearly and I want to say it again to the hon. member. I did not try to say that we did not raise taxes. I said that we did, and I did not say that anyone liked it. I pointed out that 30 per cent of everything that the government had done came from tax increases and that 70 per cent was due to government spending cuts.


Mr. George S. Baker (Gander-Grand Falls):: Mr. Speaker, I have just a few comments concerning this bill. The parliamentary secretaiy and the minister used the same words when they said: "Tell us where to find the money". "Tell me", he said, "where to find the money".
The ordinary person must think the Government of Canada has loads of money. After all, it just gave hundreds of millions of dollars to an oil company to get out of the Hibernia project. It was disclosed that the Government Canada was able to guarantee hundreds of millions of dollars for another oil company to develop an oilfield in Burma.
There are methods of granting large sums of money to people who do not really need it, especially if they are going to develop an oilfield in Siberia as is the case with Gulf Oil. It decided the other day to pull out of its commitment to an oilfield in Canada and to spend some
money in Siberia. It was disclosed that it was receiving back every penny it spent in Siberia. It was also disclosed that Petro-Canada would be getting back every penny of what it spent in an oil development in Burma.
Ordinary Canadians look at that and say that the Government of Canada must have loads and loads of money. That money is granted through a mechanism in the all-party committee report to which the hon. member for Windsor West and an NDP member referred in their remarks. It is called tax expenditures. The concept of tax expenditures was introduced back in 1967 by the assistant secretary of tax policy for the United States. He said at that time that if somebody was given a $100 tax break, it was the same as giving the person a $100 cheque. That is okay, but it depends on whom the money is being given to.
The minister of energy stood in the House the other day when I asked him a question about why the Government of Canada would be giving every penny back to Gulf Canada, to be deducted from the income tax it owed in Canada for its development in Siberia. The minister of energy said: "Yes, that is true, 100 per cent".
Then he made a remark outside the House which was quoted in the press, saying that the company had taken advantage of other tax expenditures in the past. He made reference in the House to the Little Egypt Bump, which only tax experts, tax lawyers or tax accountants would know the meaning of.


Dennis Joseph Mills: And very few of them, too.


George Baker: As the member for Broadview-Greenwood just mentioned, very few of them.


An hon. member:: Oh.


George Baker: An hon. member of the NDP just made a remark. He obviously does not realize that the law permitting Gulf Canada and Petro-Canada to deduct every penny from their income tax was amended in 1985 and 1988.
For your own edification, Mr. Speaker, the Little Egypt Bump takes its name from a belly-dancer, as I understand it, from Cairo who made quite a splash in Chicago at the turn of the century. Her name was Little Egypt and somehow the experts, this closed, tightly knit fraternity of people who make judgments, said: "Let's call this tax break the Little Egypt Bump because only
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the bare essentials of the transaction are exposed to the Department of National Revenue".
It was also called the Oldsmobile transaction. The reason why they called it the Oldsmobile transaction was that at that time General Motors put out an Oldsmobile 88 and an Oldsmobile 98. Those were the two sections of the Income Tkx Act that were used to accomplish this tax break which enabled the company to inflate the value of a property which was then sold to a partnership-this is in its simplest form-and, as the law is written, you cannot then retrieve your tax from the partnership.
Where I disagree with the NDP in every reference its members make to that is that they blame the company. They blame, as did the hon. member who spoke a few moments ago, those rich companies. It is not the companies' fault.


An hon. member:: I did not blame anybody.


George Baker: I am speaking about the hon. member from the NDP who was here a few moments ago and delivered an address on the subject of tax expenditures.
It is not the companies' fault. It is not the fault of the Reichmanns that that break was there. Why, if Paul Reichmann did not take advantage of it, if he did not go to the Government of Canada and say "look, I want it in writing before I do it", if he did not do that, if he did not take advantage of what the law was that we passed here in this Chamber, why, he would not be very smart.
It is not his fault or the fault of his two brothers. The minister even brought up the transaction outside the House. It is the fault of the government in power. Come to think of it, it was not only Gulf. It was also Petrofina. It was also Syncrude. There was one other instance where that tax break was used. [DOT]
To be able to take your money out of a company in Canada, an oil development, and to spend it in another nation, in another country and deduct every penny of your expenditure in that foreign nation over a 10 year period, and if you make any profits over there you can deduct it even faster, is not acceptable in this day and age in Canada. The U.S. does not have such a system.
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We are left with an oil development. Yes, it will survive and it will go ahead, I am sure, in Hibernia. The minister and the parliamentary secretary a few moments ago said: "Tell us where to find the money". There appears to be loads of money available for the Government of Canada to pay out billions and billions and billions of dollars.
When you look at the documents of taxation analysing the returns of individuals for the 1989 taxation year and miscellaneous statistics, the most recent one, you are struck by a couple of things. The numbers of people making over a quarter of a million dollars a year paying no income tax at all has gone up.
The hon. member for Broadview-Greenwood advocates a flat tax.


An hon. member:: A single tax.


George Baker: A single tax. I am sorry, there is quite a difference. Those are the figures that he looks at. When you examine it even closer you see that certain people in the six figure bracket are claiming the child tax credit, the federal sales tax credit and now the GST rebate. When you look at at the rules and regulations for those, and I will put it on the record, it says that it will be paid to families with low and modest incomes. The application is made out by those with low and modest incomes.
The hon. parliamentary secretary and the minister ask: "Where are we going to get the money?" Through our taxation system we have allowed those types of breaks to take place, to have someone with a reported total income of $250,000 a year paying not one penny of income tax. It is there on the record.
That is not a complete story. You can have people making $30,000 a year in the statistics of income and they can actually make a half a million.
The hon. member asks where can he get the money. In December they changed the whole system. The hon. member a few moments ago talked about the capital gains tax that was brought into this country back in 1971, the capital gains tax of 50 per cent of normal taxation that was imposed after the termination of the estate tax.
The hon. member from the NDP was complaining about it. What he should have been complaining about was what the Government of Canada did. It did not affect small businessmen, the ordinary businessmen in Canada. We met with the Federation of Independent Business just yesterday. One of the gentlemen there

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gave a very thorough presentation on behalf of small business. He made this statement: "Well, you know, our small businessmen want to be able to make the deduction as it relates to inheritance".
What the hon. member for the NDP and the government were forgetting, what we raised questions about, was what the Government of Canada did in this House in December. It totally removed the 21-year rule. As you know, Mr. Speaker, when the capital gains tax was brought in in 1971, the loopholes had to be closed. You would normally pay your capital gains upon your death, but a trust does not die. We had the 21-year rule. At the end of the 21 years all capital gains owing from assets would become payable. Twenty-one plus 72 is 93. In 1993 all of those deferred taxes, if you want to call them that, would come due.
The Government of Canada in December changed the law. It claimed it was closing a loophole. I read its material. It certainly was not closing a loophole. It said: "We are going to put it off for another two generations". It has changed the law so that the deferred taxes for the past 21 years will now be paid with the death of the youngest member of the family. The government then turns around and says: "Tell us where to find the money". I am referring to people with vast fortunes, people who have incredible amounts of money, not your ordinary everyday millionaire. These are people who have tens of millions, hundreds of millions of dollars, who can tuck away millions and millions without even bothering with it because they would like to maintain control of it forever.
The government in this House changed the law in December, affecting what somebody can claim as entertainment. Talk about tax expenditures.
When you close a loophole, you should make sure you are closing it, that you are not opening it up for all kinds of things that should not be there. When a tax accountant or a tax lawyer sits down, some of the brightest minds we have in this country, their job is to try to see how they can save money for the person paying the bill. They are some of the brightest minds in Canada. They are good at it. The Government of Canada was asked: "How far can we go in claiming entertainment? We know that we can claim 80 per cent of the cost of a
private box in the Montreal Stadium or at the ballpark in Toronto, the Skydome, $50,000 or $70,000, those nice cosy rooms that have these big mirrors that go up-"


An hon. member:: That's a cheap one.


George Baker: That's a cheap one? And there is service brought in, and so on. The hon. member says that is a cheap one. Well, it is paid for by the taxpayers of Canada. How about having a private box for those people on welfare? How about having a private box for people on unemployment insurance? What about it? They would love to have a cosy box with a mobile telephone when watching the baseball game. It is taxpayers' money. Then there are the very expensive meals, some of our best restaurants, compliments of the taxpayers of Canada, 80 per cent of it. There are other things that are claimed which are not as legitimate. The government changed the law last December. It told the accountants and tax lawyers two years ago: "We are going to change the law so that you will not have to ask us any more how far you can go. You could claim yachts back in 1977, but we closed that loophole".
You tell me I have got two minutes, so I had better get to what the government did in December. As the hon. member for Broadview-Greenwood knows, the government changed section 67(5) of the act. It said that as long as something did not contravene the Criminal Code of Canada and as long as it was not listed as an exclusion in the act, it was permissible.
That makes all kinds of things legal. That has led to stories and interviews about masseuse services and escort services that are not against the Criminal Code and that are being claimed as a legitimate expense, compliments of the taxpayers of Canada. And the minister turned around a minute ago and said: "Tell me where to find the money". The parliamentary secretary stood up and said: "Tell me where to find the money".
The money should not be found on the backs of the poor of this country or on the backs of the ordinary persons in Canada. The money can be found because it is being wasted today in grants by the Government of Canada, disguised as tax expenditures. The minister says: "Tell me where to find the money". Billions and billions and billions and billions of dollars. The government should be thoroughly ashamed of itself.
February 18, 1992


Mr. Ian Waddell (Port Moody-Coquitlam):: I have two questions I want to ask the hon. member. I made reference to the Little Egypt Bump. I might say to the hon. member that that is the first time I have heard it explained so clearly. He obviously has a lot of experience in this field.
I am not making an apology for this government because you just cannot make an apology for the way it has run the economy. I remember when I was energy critic of my party, the NDP, getting in evidence that the Liberal government of the day spent $13 billion, and these were dollars in the early 1980s, on petroleum incentive program grants, PIP grants, to oil companies. I personally think this is one of the reasons why we have a huge deficit today. Is it not in fact the Liberal government, which ran Canada most of my lifetime, that is really responsible for the big debt that we have federally in this country? Is it really not a hangover from mismanagement by Liberal governments? Did those same Liberal governments not really fashion the modem tax law with all those loopholes, including the research grant scandal, research write-offs, the Little Egypt Bump and those kinds of provisions of our tax law?
Further to that, he will recall these Liberal civil servants, people like Mickey Cohen, who fashioned the National Energy Program and who were wheeling and dealing with Petro-Canada when they took over Petro Fina and never really revealed, in spite of the Auditor General trying to get that information, what went on. These people just moved right out into the private sector, work for the Reichmanns and then take advantage of some of their own laws that they made when they worked for the Liberal government, ripping off the taxpayers in that way.
The taxpayer gets screwed, it seems to me, by the laws of the former Liberal government and some of the people who were involved with them, who, as soon as they go into the private sector, rip off the ordinary Canadian who must pay taxes.


George Baker: Here the hon. member goes again, the NDP. He said: "They made their own laws. Mickey Cohen made the law," he said.
It was not Mickey Cohen who made the law, it was the government that made that decision. It was the cabinet that made that decision.
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Granted the hon. member can say: "Well, he was the deputy minister at the time". He was the hired help. He was the one who had them pass judgment on the recommendations set up by the department. That is true. The hon. member is correct. But Mickey Cohen did not make the law. That recommendation concerning, as he put it, the Reichmann empire at the time was made by the Government of Canada, this Government of Canada right here.
The hon. member said: "The Liberals are at fault. They are the ones that drove up the deficit through PIP grants". The PIP grants were for oil development in Canada-in Canada.
What did the Tories do when they got in? They wiped out the PIP grants and the hon. member from the NDP was in agreement with it. They wiped them out for oil development in Canada and they propped up oil development in foreign nations.


An hon. member:: Our security of supply.


George Baker: The hon. member here will not criticize the Government of Canada encouraging expenditures in Siberia or Burma by Petro-Canada and the total tax write-off.
If the hon. member went back and really looked at the tax law that he referred to, far down on the corporate tax return it says "foreign exploration and development, oil and gas". A company is allowed to deduct 10 per cent a year until its total funds that it spent are recovered.
Well, I tell the hon. member that there were two amendments made to that provision in the Income Tax Act. They were made by this Government of Canada solidifying and enforcing a 100 per cent write-off for oil developments in foreign countries, while they turned around on the advice of the NDP and cut off the grants for oil companies exploring and developing oil in Canada. That is the truth of the matter.


Dennis Joseph Mills: Mr. Speaker, I am happy to have an opportunity to speak on this Bill C-56, the control of government expenditures.
As many members have said previously and also as our finance critic, the hon. member for Windsor West has stated so clearly, this bill is cosmetic. It is smoke and mirrors.

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Do we really need a bill to send a signal to various parts of the Government of Canada that we want to control expenditures? This bill shows Canadians once again that this government does not have a legislative agenda.
When there are so many unemployed people in this nation and the government puts forward a piece of legislation that is nothing more than smoke and mirrors, then we know that its creative process has really dwindled to a state where I am sure most Canadians would find it frightening.
We should be debating in this House today ways in which we can put people back to work.
The government repeatedly asks us where are the ideas from this side of the House?
The hon. member for Gander-Grand Falls, whom we just listened to, has hit the nail on the head.
The people of this country are fed up with the tax designs that exist in this country. They are absolutely frustrated with the fact that politicians at all levels of government are not listening to the level of frustration that they feel toward the tax designs, especially the personal and corporate designs.
The member for Gander-Grand Falls has just given a beautiful illustration how the tax preferences, given through the tax act, really show that the basic tax act of this country is unfair.
This is so important in relation to job creation that we had better do something about it quickly. If we are going to be a competitive nation, if we are going to create more jobs in this country, if we are going to expand this economy-and that is the only way we are going to create the jobs-then we are going to have to create better products and better services at more competitive prices.
This government possesses one instrument that can effect a change in the productivity of this country. It is the tax act. Right now, the average men and women of this country feel the tax act is treating them unfairly. We know it is treating them unfairly. They want us to address this problem with a sense of urgency.
We are very close to a tax revolt in this country. We have situations in the municipalities of this country
where people cannot pay their municipal taxes and municipalities are frightened. What are they going to do? They do not have the revenue. Do they want to take businesses out of business and create more unemployment?
The Government of Canada is not listening to the fact that the tax designs that exist in this country are not working. This is why we have a problem in terms of productivity.
If people are to produce a better product at a better price, they have to be treated fairly and this can begin with the tax designs. Bring fairness back into the tax system. Bring simplicity back into the system.
Last year, 80 per cent of the returns that were filed in this country were filled with errors. Consider the inefficiency that exists in the tax system of this country.
We have a situation right now, and the member for Gander-Grand Falls referred to it in his speech, where rules and regulations, and exceptions, and exceptions to exceptions right now are causing disunity in the country. It is wreaking havoc with the entrepreneurial spirit in this country and that is the spirit that we as a nation depend on to create the jobs.
What are we doing to that spirit? We are ignoring it.
When we have a crisis like this on our hands, we cannot ignore the voice of the entrepreneurial spirit in this country. It is saying: "Fix the tax act. On the personal side, fix it; on the corporate side, simplify it, clean it up, bring us some fairness".
If we did that we would have a motivated work force in this country which would create a better quality product at a better price, which ultimately expands the GNP of this country.
More people would be employed which would mean less draw on the unemployment insurance fund and less draw on the welfare fund.
When interest is calculated on $30 billion worth of disbursements just on UI and welfare, in 18 months we would not have a deficit.
The focus of this government is all wrong. It has a one-track mind. It has absolutely no creativity and it is cut, cut, cut. Now it comes in with this deathbed conversion bill, control on expenditures.
February 18, 1992

We know that there is waste in this government. There is waste in every institution in this country. There is waste in every family.
We do not need a bill to legislate expenditure control, especially a bill like this that has so many loopholes in it that if all of a sudden something comes along, an economic downturn or whatever, we ignore the bill anyway. What kind of hypocrisy is that?
This is the nation's boardroom. People in Canada are counting on us to put our energy and creativity into ways and means of putting people back to work.
One way to do that is to listen to the small businessmen of this country. As the Minister of State for Finance said yesterday, there are 1,700,000 businesses in this country. If we can mobilize and motivate that force, then we can eradicate unemployment in this country almost overnight.
The one issue that small business, the entrepreneurship of this country, keeps coming back to us on is tax reform. If we were to address that issue, then so many other things would fall into place.
The member for Gander-Grand Falls gave a beautiful example today when he talked about a legal tax preference written into the tax act of Canada which actually encourages a company to invest close to $1 billion offshore.
If we reform the tax act of this country, we could have those capital flows reversing the other way. If we reform the tax structure of this nation, we could have the capital flows, the investment coming this way.
The foreign investment in this country in the last 18 months is down close to 50 per cent.
There are many reasons for that. Many of those foreign investors will cite our tax designs as being one of the reasons they are frustrated or why they do not have that extra energy, that extra burst of enthusiasm to try and invest in this country.
If we were to change the tax act and get the capital investment flows back into this country, that would allow and create a situation again where the entrepreneurs would have the capital to buy new equipment and new technology. This would allow us to be even more efficient. All of that can be done through the tax act.
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What have we done? The core problem, the fundamental problem, the problem that we hear of when we go door to door and store to store in our communities, and it does not matter what region of the country, it is every region where people tell us is that the tax designs are not working. What do we do instead of listening? We throw the GST at them, a paper burden, a disincentive to productivity, a disincentive to tourism. It is unbelievable.
I cannot believe the rumour I hear right now. Some groups are saying that we should cut the GST by 1 per cent and that will make things better. Cutting the GST by 1 per cent would be an insult to most Canadians. They want the GST scrapped. It must be scrapped. We must come up with an alternative.
My leader has said repeatedly that it will be scrapped. Make no mistake about that, and the press should not make any mistake about that. We are scrapping that GST, if it is the only thing we do. It is affecting the spirit and it is affecting the productive capacity of this country in every region.
Yes, it will be tough to reform the tax act of this country. That is the kind of legislative agenda that we should be taking on in this House rather than, as my colleague the critic for finance stated earlier, some piece of legislation that is only cosmetic.
I believe the people of Canada see through that smoke and mirrors, that cosmetic approach. They are not going to buy it. The time is now, because the situation is so desperate, that we do something about this issue. The government should reflect at the end of today's debate on this bill respecting control of government expenditure and realize that the nation does not want to hear about some little gimmick for controlling expenditures that has all kinds of loopholes and options for change whenever the government needs them.
This is the nation's legislature. Many people on that side of the House think that the cabinet runs this country. It is not the cabinet. This is the debating room on issues of concern to the people of Canada. It is not the cabinet. They can go back to their cabinet, take then-decisions and be responsible for them. People are talking about unemployment, tax designs, and some of the desperate situations like that faced by the fishery in Atlantic Canada right now. They want them debated in this room, and not in the middle of the night. If it has to

February 18, 1992
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be the middle of the night, fine, but they want them put on the floor of the nation's boardroom. Today we have some little silly piece of legislation on expenditure control. There is absolutely no logic. It shows once again that the creative juices of this government have lapsed.
I support my colleague, the member from Windsor, our finance critic who said: "Let's go to the people and let them decide whether or not this government has the best policies for the people of Canada". The government keeps bragging about this fiscal comprehensive plan that is dismantling everything in this country. Let the people decide whether or not this program, this crazy journey that it brags about and has taken us on, is the right way to go. I support the approach of the member.


Mr. Jim Karpoff (Surrey North):: Mr. Speaker, I am pleased to be able to rise to speak on this piece of legislation. This bill is entitled an act respecting the control of government expenditures. It is in the same vein and the same tone as voodoo financing that we have become accustomed to in British Columbia with the whole question of BS funds, budget stabilization funds, where moneys were moved back and forth on paper. They have now found out that they are not even in existence. It is based on the whole concept of what the government has said: "We are out of control. We have no ability to control our own expenditures. We are undisciplined. We are irrational and therefore we have a legislative framework that forces us to be disciplined, to be rational and to follow fiscal restraint".
When I was first out of university I worked in juvenile corrections, including juvenile courts and juvenile detention centres. In those centres it was very typical to have kids who were out of control, who acted impulsively, who acted irrationally, and who even acted not in their own best interests. They would do things while they were in the facility. They would pick unnecessary fights. They would damage property. They would do all kinds of things.
I remember one time somebody came along and said: "Look, all we really need is to make some rules for these guys. Let's make rules that you have to be nice to everybody. Let's make rules that you cannot pick fights with other people or with staff". They were all good
intentions. People thought if they brought in these rules everything would be nice, but of course it did not work because the kids did not have the self-control, the self-discipline and the maturity to abide by those rules. That is why they were there.
That is what we have with this federal government. It is in fiscal difficulty because it does not have the fiscal maturity, the fiscal responsibility and the fiscal knowhow or commitment to deal with its financial expenditures, mounting federal debt and the deficit.
What does it do? It says: "Let's bring in some nice rules that say we must be disciplined. If we are going to have expenditures, we have to find out where the revenues are. We have to offset them. We have to bring some order to our expenditure and revenue program".
It is so laughable it is like the juveniles in the detention centre. Rules are going to do nothing for this government, because if it is undisciplined and fiscally incompetent it is simply going to break those rules and there will be continued chaos.
I am beginning to be tremendously delighted about the way this government plays the shell game, particularly projecting and controlling expenditures in a period long after it is going to be defeated. Its members have no discipline themselves so now they are trying to say: "We will put in controls and project a discipline to the year 1995", knowing full well that they will not have to abide by this legislation because they are not going to be here.
If they called an election today they would be gone in six weeks. If they happen to limp along until the fall of 1992, they will be out of power then. It is like many of their expenditure announcements when they talk about spending $147 million on family violence and we find out it is only $15 million this year and a little under $20 million next year. The rest of it is often in Never Never Land. Voodoo economics, voodoo at least. Government members talk about bringing in discipline and an understanding of fiscal control. I have been an administrator for most of my life. I have controlled large budgets. I have handled base line budgeting methods, zero based budgeting methods and all sorts of fancy terminologies brought in by various governments and organizations in terms of fiscal control.
February 18, 1992

The reality is that none of them work unless there is a will and an understanding of fiscal restraint and accountability among the people involved in decision making, and we have not seen that in this government.
The government is quick to say it had to do something because it has this mounting debt problem. There is no doubt that we now have, thanks to Liberal and Conservative governments, a very difficult debt problem.
We know that an analysis has been done as to what has caused the debt problem. Statistics Canada pointed out that 44 per cent was caused by tax loopholes and tax concessions to large corporations, that 50 per cent was caused by high interest rates, and 6 per cent by program expenditures.


An hon. member:: What about tax breaks?


James Capsey (Jim) Karpoff: Well, 44 per cent is caused by the reduction in moneys that should have been paid but were not paid, which means the average Canadian has had to pick up more.
The Liberals left a legacy of a $160 billion debt. I could speak a long time about the incompetence of the Liberals and that debt. Let me just go on. The government has blamed the Liberals consistently that the debt is simply a rollover starting from the $160 billion and is nothing but compound interest.
This government has had a high interest rate policy. There is absolutely no reason over the last number of years that interest rates have not been at least 4 per cent lower than they have been on average. If we had started off in 1984 and had our interest rates 4 per cent lower right across the board, the first year we would have saved something over $6 billion in interest rate payments. This year we \0ould be saving something like $16 billion in interest rate payments.
They could have taken that $6 billion and reduced the deficit on an ongoing basis from 1984 until now. The Tories could have plugged those tax loopholes from day one, after they were elected. They could have brought in some fair taxation so that companies like Alcan, which in some years made $250 million or $230 million, would have paid taxes. The estimates vary a little. Some people say that the tax loopholes cost us $12 billion a year; other
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say $16 billion. The Tories agree that it is only $9 billion a year.
Let us take a round figure of $10 billion a year. If the Tories had plugged that loophole in 1984 and saved that $10 billion a year, plus the $4 billion a year in interest rates, and compounded it forward over the eight years they have now been in government and done nothing else, just those two things, we probably would have almost no deficit in this fiscal year. Somehow they can sit there and say: "We are not responsible because we were left with this legacy".


An hon. member:: What do you think Bob Rae is saying now?


James Capsey (Jim) Karpoff: That he got left with this legacy. The government did get left with this legacy and a hell of a mess, the same type of Liberal mess that Bob Rae got stuck with in Ontario. The Liberal government said all the way through the election that there was a $23 million surplus. When the election was over, even before it resigned, it was forced to admit that there was no surplus, there was not even a $23 million deficit. The deficit was hundreds of millions of dollars that the Ontario NDP government was left to deal with.
This government has learned another trick from the B.C. Socred government and it is called "when we can't control ourselves, we'll off-load on somebody else". It is like that juvenile in the detention centre: When the government could not control its own behaviour, it quickly learned to blame somebody else or to make somebody else responsible for it, or make somebody else suffer the consequences of its behaviour.
In the last three to four years this government that cannot control its own expenditures decided it was going to off-load on to the provinces. It started off not only off-loading on to the provinces, but on to workers and small businesses, and it did it with changes to the Unemployment Insurance Act. It said that it was no longer going to put money from the Consolidated Revenue Fund into premiums; it was going to be financed 100 per cent by employees and employers.
It costs my municipality a million dollars a year and it costs the hospital a million dollars a year in increased UIC premiums. Therefore, they had to cut back on their expenditures. Health care institutions and municipalities are going to have to pay.

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The government changed the waiting time and the length of time people can collect benefits, which has meant there have been dramatic increases in the demand for income assistance, particularly as we have gone into a recession.
I am beginning to realize that this government knew the recession was coming. It should have known, it was planning it; in fact, it engineered it. One of the first things it did was make itself recession proof: "We are not going to pick up the cost of the recession, so let's get out of UIC. We'll off-load that on to the provinces, we will off-load it on to the income assistance". Then somebody said to them: "Of course you know we have to pay 50 per cent of that income assistance". So the government said: "We will off-load that on to the provinces too".
The government brought in a ceiling for the three big provinces-Ontario, British Columbia and Alberta-in which income assistance is limited to a growth of 5 per cent, knowing full well, because of the changes to the UIC and to the recession that it had precipitated in this country, that the costs were going to go up dramatically. However, it had off-loaded those on to the provinces. You know, the cost to the provinces is going to be at least $5 billion over the period.
Then the government came to such things as the EPF, the Established Programs Financing, which is for postsecondary education. It talks a lot about the need for additional training and education, that that is our route to financial security and competitiveness. But of course it says: "We are not going to pick up the cost of that, we are going to off-load it on to the provinces". The cost to the provinces by the year 2000 will be $64 billion.
So this government simply says: "Look, we have no ability to control our own expenditures; we are out of control so we will simply off-load on to local governments and provinces".
There are other transfer payments that it has offloaded. The government has simply said to the provinces: "You're going to have to pick up the cost". Some of these are programs which the government sanctimoniously speaks of the need to help. It has off-loaded farm income stabilization, crop insurance, economic development, reforestation, policing, social housing, correctional facilities.
The B.C. government has done an excellent analysis of the impact on the province of the off-loading of federal costs on to that province and the impact on that province. The total cost in this fiscal year is $1.1 billion, out of a total deficit of $1.7 billion. In other words, all that has happened is that the federal government has reduced its deficit by transferring it to the province.
Expenditure controls have not been cut back. The Canada Assistance Plan in British Columbia will have $160 million less this year, $1 billion over a five year period. The Established Programs Financing cutbacks are going to be $6.8 billion by 1995.
I think it is important to remember where these cutbacks started. They did not start only with the Tory government. They were started by the Liberal government in 1982. In fact, out of the total $6.8 billion loss of revenue for EPF between 1982 and 1985 for the province of British Columbia, $2.6 billion is because the six and five program was brought in in 1982.
Here we have the off-loading. When we start looking at it, we find out that really the Liberals not only left the Tories with a legacy of $160 billion debt, they left them with a program and plan of how they can off-load this stuff on to the provinces. They initiated it with block funding in 1977 and then the changes to the EPF formulas starting in 1982 and again in the six and five program. We now know the Tories learned many of these things, not from the Socreds, but from the Liberals.
The federal government is talking about fiscal restraint. The reality is that 20 per cent of its total expenditures amount to transfers to the provinces. In the last three years, over 50 per cent of the restraints have been in cutting back in transfer payments to the provinces. In other words, the bulk of its efforts to reduce its own expenditures have in fact not been reducing expenditures but have in fact been off-loading.
I see, Mr. Speaker, that you are signalling that I have another minute. I just want to-


The Acting Speaker (Mr. DeBlois):: Order, please. I am sorry but your time has expired.
February 18, 1992


Peter Andrew Stewart Milliken: Mr. Speaker, I have a brief question for the hon. member. I enjoyed his speech very much. I wonder if he could take the House into his confidence and tell us whether or not the New Democratic government in Ontario is going to introduce a bill along the same lines as this one. I noticed that government has taken to copying almost every move of the Conservative government in this House. When the Conservative government cuts back transfers to the provinces the NDP reduces transfers to the municipalities to 1 per cent. It does the same for school boards and for hospitals. Everybody gets 1 per cent now in NDP Ontario.
The NDP says the reason why it is doing that is because of the terrible deficit that was left by the Liberals, and of course the Conservatives in Ottawa, eight years later, are still saying: "The reason we are cutting back the transfers to the provinces is because of the terrible debt left by the Liberals". We all know that the story in both cases is pure hogwash. It is simply an unwillingness to accept responsibility for its own incompetence and the terrible recession that has been brought about by these two governments.
I want to know if the member can tell us, given the apparent willingness of the NDP to copy everything that the Conservatives do in Ottawa, if he thinks the New Democratic Party government in Ontario is going to bring in a bill like this.


James Capsey (Jim) Karpoff: Mr. Speaker, the Ontario government has had to face a number of disastrous economic problems caused by free trade, the high dollar, the high interest rates and the legacy left by the Liberals. The Liberals increased the spending 10 per cent a year instead of trying to develop an economic base that could be diversified and stand some of the pressures around a recession.
Provinces have to pass along some of the cutbacks that this government is forcing on them, particularly through health care. That great Liberal bastion, Newfoundland, as a result of transfer payments had to lay off 10 per cent of all of its nursing staff last year. That is the way the Liberals did it.


An hon. member:: That is what is going on in the hospitals in Ontario now.
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James Capsey (Jim) Karpoff: They simply laid off 10 per cent because of the cutbacks, but one thinks that philosophically they are on the same wavelength. We now have the Liberal premiers, Wells, McKenna and Bourassa, talking about the introduction of user fees. All the Liberal premiers are advocating a two-tiered health care system, one for the rich and one for the poor, with the introduction of user fees. They say:	"Well, that is because of the
cutbacks from the federal government in terms of EPF".
I have some empathy with them in terms of the cutbacks from the federal government when they are talking about health care: $64 billion has been taken out of health care; another $32 billion has been taken out in post-secondary education. Provinces like Newfoundland are undergoing a crisis in employment. If Newfoundland's rate of unemployment was the same as Ontario is having right now, it would feel itself very lucky.
We now have a situation where the fisheries is caught between a rock and a hard place, where in order to conserve any of the fisheries for the future generations, hard realities of conservation are going to have to be brought in now. There are difficulties, but you do not see the NDP governments talking about introducing user fees for health care.
The Liberals in Newfoundland had to lay off 10 per cent of their staff and their solution is simply: "Let's bring in user fees. Let's make sure the poor and the middle income persons do not have access to an adequate health care system".
We have a situation now developing in this country where the New Democratic premiers, the four of them, are standing up and saying: "We will protect our national health care program in spite of this federal government and its cutbacks". Premiers Bourassa, McKenna and Wells are advocating the introduction of health care user fees.


Peter Andrew Stewart Milliken: Mr. Speaker, what a loss of time for this House to have to consider such a ridiculous bill today. It is indeed ridiculous. I fail to see why the government has introduced such legislation. Obviously, it did nothing to put an end to the disastrous economic policies it has been pursuing.

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In looking at the reasons for this bill, I can only conclude that its purpose is to bamboozle Canadians into thinking that somehow the government has a grip on its expenditure programs. The speech by the Minister of State for Privatization this morning was further evidence of a complete and utter inability to deal with these issues in a rational and sensible way. It is clear evidence that the government has lost its grip.
While I am on my feet, might I suggest that Your Honour take the power to adjourn this House into your hands, since there is no minister here who is able to respond and listen to this debate on a government measure. It is the practice that ministers must be here for debates on government bills. I would ask you to take the matter into your hands and adjourn the House in the absence of any minister.


The Acting Speaker (Mr. DeBlois):: The hon. member has been in Parliament long enough to know that it is not our pratice to refer to the presence or the absence of fellow members. Although he is referring to an established tradition, the fact remains that it is not an absolute necessity for the debate to continue. I would therefore ask the hon. member to carry on.


Peter Andrew Stewart Milliken: I think it shows a complete callous disregard for the importance of this Chamber that this is the case, but I will continue with my speech in spite of this lack of personnel.
I wanted to talk about the fact that the government itself in 1984 indicated how serious Canada's economic situation was. It is from this 1984 report, this 1984 statement if you like, that we learned how terrible it was that Canada had been governed by the Liberal Party for the previous many years. The government went to great lengths to point out that if the policies of the previous government were followed, certain economic consequences of great magnitude would befall Canadians, and somehow our country would simply go to pieces with the continuation of those policies.
Indeed, there was a great deal of trumpeting and fanfare by the then Minister of Finance that the changes he was about to announce were going to solve Canada's
economic woes. Somehow by checking the policies of the previous administration, Canadians would be brought from the brink of disaster into a great new golden age.
Unfortunately the Minister of Finance was wrong then, and has been wrong with every pronouncement he has made ever since. The statement applies to both the former Minister of Finance and the current Minister of Finance. Both have failed Canadians and this government has failed Canadians. It has been a disaster for Canada. Canadians are just sitting waiting for an opportunity to throw this government out of office. We are waiting for an opportunity for an election and this bill is an attempt by the government to shore up its dwindling electoral opportunities and dwindling chances. I suggest it is an inappropriate effort. It is a silly ridiculous effort and it is a complete waste of time of this House to introduce a measure as stupid as this particular bill.
The government stated in 1984 that if the previous government's proposals or policies were not changed, then budgetary expenditures would increase by 55 per cent in those financial years between 1983-84, and
1990-91. Budgetary expenditures would go up 55 per cent if Liberal policies were followed. We keep hearing how Liberal policies were the root of all evil. Well, throughout that same period while the Minister of Finance was in office, budgetary expenditures in fact went up by 69 per cent, not 55 per cent as they would have done under the previous government.
Whose policies are to blame for the deficit today? If they had only gone up 55 per cent, think how much we would have saved. They went up 69 per cent because of this government's incompetent policies.
The government predicted that budgetary revenues would have to swell by 76 per cent if the previous government's policies were pursued. In fact they went up by 86 per cent largely because of the enormous additional burden of taxation levied by the government opposite to cover its lavish spending. There is no other reason for it.
It claimed that the deficit would be $37 billion in 1991. It did a little better there. Because it raised taxes so much, it got it down to $30.6 billion, which was barely lower than what was projected. Of course it is now rising and we will hear more about that I expect next week.
February 18, 1992

It also predicted that the net public debt by 1990-91 would be $407 billion. It was slightly off. It was only $388 billion, an increase of 131 per cent. That is the kind of increase this government brought in because of its disastrous policies of the last five years. Now it is trying to say on the one hand, the reason for the financial crisis in Canada is because of the Liberal debt we inherited. On the other hand, it says that it is now going to bring government expenditures under control.
If this bill is such a great idea today, why was it not brought in 1984 when the Minister of Finance made this famous statement in which he said that Canada was going down the tubes if it followed the policies of the previous government?
If government expenditure is so important today, why was it not even more important in 1984 when it claimed it was solving the problem of excessive government expenditure? It allowed it to increase by 69 per cent in a five-year period.
I will tell you why it is more important today. It is because this government wants to go to the people of Canada in an election campaign and say to the people that it has brought the government expenditures under control, and has passed some bill that somehow magically solves this problem.
This is so transparent and so fraudulent that it cannot bear any reasonable examination. One of the government's own supporters knows what is going on here. He knows that Canadians are being bamboozled by this process. I want to quote the hon. member for Mississauga South who knows more about finance, quite frankly, than the Minister of Finance or the previous Minister of Finance for that matter.
He has been chairman of the finance committee of this House and has a far better grip in my opinion on financial matters than any Minister of Finance this government has ever produced. What does he say? I quote from The Ottawa Citizen of July 29. I thank my colleague from Windsor West for his eagle eye in spotting this excellent quotation.
The article said: "The bill to limit annual increases in government spending to 3 per cent over the next five years is a charade" he said. He is especially critical of the exclusion of so-called tax expenditures or tax breaks from the CAP.
Government Orders
Here is an expert in this House on finance, someone who knows more about finance than the Minister of Finance ever did, who said that this bill is a charade. Why are more members on the government side not speaking to this bill? I will tell you why. They are humiliated and embarrassed to have to defend such a completely silly piece of legislation.


Mr. Ferguson:: That is why there are no ministers in the House.


Peter Andrew Stewart Milliken: They are hiding their faces in shame at the thought of this silly legislation being discussed in this House.
Let's look at the proposal the government put forward. Initially it sent a draft to the Standing Committee on Finance for pre-study. What did the draft say? It proposed 3 per cent per year for a five-year period, for I think a maximum of 15 per cent. It is compounded so we will allow for that. Now they have revised it.
The new bill before us has changed those figures to increase the amount slightly. Why did it increase them? Presumably because it felt it could not keep its expenditures at 3 per cent. In other words, it figured out exactly how much it was likely to increase expenditures and then allowed for the cap to accommodate all their spending plans.
One can only expect the reason for the increase in the level is because there is an election coming up, and it does not want to cut back too much. We hear that the inflation rate in Canada is going to 2 per cent.
We know the government is giving its employees one per cent this year and three per cent next year. Why are we having increases in excess of three per cent? Are those figures going to hold firm? Why are we going to have increases in government expenditure in excess of three per cent if the inflation rate in Canada drops below two as we expect it will according to the most recent newspaper account? I expect we will hear that from the minister shortly.
Why are we spending more? The government says it wants to control expenditures. Its desire to control is dictated only by a desire to appear to control for the purposes of an election campaign. It is not because it genuinely believes that control of expenditures is important. It had seven years to bring government expenditures under control and it has abysmally failed.

February 18, 1992


The Acting Speaker (Mr. DeBIois):: It being one o'clock, I do now leave the chair until two o'clock this afternoon.
At 1 p.m. the house took recess.


[Stage Direction]
AFTER RECESS

The House resumed at 2 p.m.

Mrs. Shirley Maheu (Saint-Laurent-Cartierville):: Mr. Speaker, Canada should not recognize the republic of Macedonia unless it meets two very specific criteria.
This former component of Yugoslavia must renounce any direct claims it has to Greek territory or those implied by its misleading name.
This republic must drop the name Macedonia. To continue to promote this form of historical revisionism is to perpetrate cultural and historical fraud.
Macedonia is an intrinsic part of Greek culture and history that is of fundamental importance to thousands of my constituents.
Mr. Speaker, there is no connection between Josip Tito and Alexander the Great.


CROSS-BORDER SHOPPING
Mr. Bob Corbett (Fundy-Royal):: Mr. Speaker, abuse of cross-border shopping is draining the Canadian economy of an estimated $2 billion to $3 billion a year. Losses to New Brunswick are as high as $200 million.
The abusers of an already generous duty allowance are costing their fellow Canadians their jobs by the thousands. 'Hie additional financial burden put on the majority who do not abuse the system is unfair.
The abusers feel no compunction about letting other Canadians pay for their use of our medicare, old age security and all the other Canadian social safety nets.
They do not shop across the border when it comes time to go to the hospital, when they collect their unemployment insurance, when they might have to avail themselves of workmen's compensation.
Perhaps it is time that we devised a way of making these abusers of cross-border shopping even the playing field with the majority the next time they pay a visit to the doctor.


OLYMPIC GAMES
Mr. Joe Comuzzi (Thunder Bay-Nipigon):: Mr. Speaker, congratulations to Kerrin Lee-Gartner on her outstanding achievement in her gold medal win at the Olympic Games. We are also very proud of her technical coach of four years, Craig Spiess of Thunder Bay.
Other Olympic participants from Thunder Bay are David Walker in freestyle, Kevin Dahl in hockey, and Peter Robertson-Stovel in bobsledding.
While praising our Olympic champions we should not lose sight of the many thousands of Canadians who dedicate their lives to help develop our Olympic athletes. People like Craig's parents, Marilyn and Larry Spiess who operate and own Mount Baldy ski area in Thunder Bay. Their dedication and devotion to skiing, and the dedication and devotion of so many thousands of Canadians like Marilyn and Larry, is the glue that makes Olympic hopefuls into Olympic champions.
So today we salute the many thousands of Canadians like Marilyn and Larry who independently, without government assistance, bring our Canadian athletes to the threshold of greatness. This House salutes them all.


SPORTS FISHING
Mr. Steve Butland (Sault Ste. Marie):: The federal government has demonstrated its inability to handle the east coast fishing industry and possibly will repeat this mismanagement in the Great Lakes.
The stocks of whitefish, trout and salmon are threatened by a predator, the lamprey eel, which unless controlled could destroy a thriving sports fishing industry.

February 18, 1992

Through an agreement signed by the U.S.A. and Canada, a funding arrangement of 69 per cent and 21 per cent respectively was signed in 1955.
Canada has continually dragged its feet in funding commitments. This year the U.S.A. has committed an 18 per cent increase and to this point Canada has not responded. A $3.5 million investment could preserve a $1.4 billion industry.
Our Canadian workers in the field have tremendous expertise but cannot respond appropriately because of funding constraints.
Why doesn't the much-heralded green plan respond with funding to deal with this problem?
President Bush, an avid angler, appreciates the importance of this issue. He has baited the hook and we ask the Prime Minister to bite.


GENERAL AGREEMENT ON TARIFFS AND TRADE
Mr. Jean-Luc Joncas (Matapedia-Matane):: Mr. Speaker, I have had the opportunity over the past few weeks to meet with several farmers' organizations in my riding. Dairy, beef, pork, poultry and egg producers, they are all concerned, and rightly so, about the ongoing GATT negotiations. Canadian farmers have developed a supply management system at the cutting edge which regulates their production and allow them to make a decent living by operating their farms.
Let me tell you, as a member representing a riding which mostly depends on farming and having been raised on a family farm, that I share the concerns of the rural community regarding the unclear positions the media reported government has been taking at the GATT negotiations. Our farmers need to be reassured about the position being put forward by the government of Canada in Geneva and to know that it will keep supporting vigorously the strengthening of article XI of GATT. Mr. Speaker, I urge government to stand firm and not to renege on its commitment to the farm community.


FISHERIES
Hon.   Chas. L. Caccia@Davenport: Mr. Speaker, the headlines on slashed cod quotas bring home the meaning of sustainable development and illustrate dramatically what can happen to fishermen, to farmers, and to loggers when we fail collectively to manage our natural resources properly.
Why is there a cod crisis? It is because for years more cod have been harvested than could be naturally renewed. Consequently, our fishermen are bearing the brunt of past mistakes. The situation is made worse by foreign fleets overfishing outside the 200-mile limit.
If future generations are to have a chance to earn a living off the Grand Banks then Ottawa must unilaterally take over management of the fish stocks on the Grand Banks outside the 200-mile limit.
This is an emergency which calls for emergency conservation measures.


BREAST IMPLANTS
Mrs. Louise Feltham (Wild Rose):: Mr. Speaker, I would like to congratulate the Minister of National Health and Welfare who recently announced the creation of an independent committee of experts to study silicone gel-filled breast implants.
This committee will travel to Washington, D.C. and review all current information on these implants. They will also have access to all documentation available to Health and Welfare Canada. They will make a preliminary recommendation to the minister before February 28.
This action clearly shows that the minister's priority is for the health and welfare of Canadian women.


FISHERIES
[Stage Direction]
Mr. Dave Dingwall (Cape Breton-East Richmond)
Mr. Speaker, the situation in the Atlantic fisheries is of fundamental importance to our economy, to the social welfare of our citizens and to the Canadian environment.
[Stage Direction]
February 18, 1992
I am appalled that the Government of Canada which has the sole responsibility both constitutional and otherwise to manage our fisheries has acted so negligently on this most important issue.
The question must be put. Who is managing our fisheries? Is it the Department of External Affairs? Is it the Department of Fisheries and Oceans? Or is it the foreign capitals in Spain and Portugal and other foreign countries?
The situation in Atlantic Canada is of paramount concern to all Canadians. They have seen by the demonstrable acts of this government the negligence that it has put forward in terms of managing our fisheries.
I urge the Minister of Fisheries and Oceans to take heed of the advice he has been given by all members of this Chamber in order to change a very, very serious situation.

Mr. Ken James (Sarnia-Lambton):: Mr. Speaker, Canadians can have their house expropriated without a hearing to determine fair value. There are many legal opinions that there is no legal recourse.
Mr. David Stratas of a noted Toronto law firm said in a paper released recently that the charter does protect some interests which can be said to be proprietary in nature.
The absence of a specific provision enshrining the right against confiscation of property unless it is in accordance with the principles of fundamental justice means the arbitrary and irrational exercise of power. Mr. Stratas writes:
There are reasons of varying strength which support putting property rights in the charter. These are:
(a)	The right to property is not unknown to our law;
(b)	The right to property is one of our oldest common law rights; and
(c)	The right to property plays an important role in furthering other important rights.
The right to property would have been useful in preventing government excesses in the past.
The Canadian Charter of Rights and Freedoms should be amended to guarantee property rights.


ISABELLE AND PAUL DUCHESNAY
Mr. Gilles Rocheleau (Hull-Aylmer):: Mr. Speaker, it is always frustrating not to be able to do what one wants. That is what Isabelle and Paul Duchesnay said after they participated in the Olympic Games in Albertville.
These two residents of my riding in Quebec represented France because they were not recognized by Canada. They said that they were very disappointed about the pressure put on them to change their whole program, not to mention that the lowest mark was given to them by the Canadian judge.
It seems that they are criticized for being innovative and wanting to outdo themselves. It seems that they are criticized for being distinct. What a funny coincidence, Mr. Speaker.
I want to extend hearty congratulations to Isabelle and Paul for representing us so well, with such determination and style.
On behalf of Quebecers, I want to give them a gold medal.
Hats off to Isabelle and Paul. Quebec is very proud of you both.


FORESTRY
Mr. J. W. Bud Bird (Fredericton-York-Sunbury):: Mr. Speaker, from March 2 to March 4, members of Canada's forestry community will meet in Ottawa at the National Forest Congress sponsored by the Canadian Council of Forest Ministers and the Canadian Forestry Association.
They will discuss implementation of a new national forest strategy. The strategy entitled "Sustainable Forests: A Canadian Commitment" is important for several reasons.
It makes a series of commitments on behalf of decision makers and stakeholders in Canada's forests to adhere to meaningful codes and standards of forestry practices, to
February 18, 1992

balance the differing values placed on forests by society, to enhance the role of Canada's aboriginal peoples in forest management, and to ensure Canada's work force is adequately trained to take advantage of new technology and new knowledge.
It will also ensure that forest industry practices are environmentally sound, that they protect significant forest eco-systems and that they ensure timber harvesting and forest regeneration are kept fully in balance.
This strategy is an example of the emerging spirit of co-operation and the willingness among all forest stakeholders to become partners in the next generation of forest management.
Literally, this strategy should become a Canada forest accord to serve all Canadians.


BREAST IMPLANTS
Ms. Dawn Black (New Westminster-Burnaby):: Mr. Speaker, yesterday the Minister of National Health and Welfare announced the establishment of an advisory committee to study silicone breast implants.
While it is difficult to condemn the minister for finally taking this action, it is, like all others taken by the minister, far short of what is needed.
This committee will not add to what is already known about the dangers of silicone implants. The information this committee will have access to is not new. It has been, or should have been known to the health protection branch for years.
What has been lacking is the commitment from successive Tory and Liberal ministers of health to safeguard Canadian women's health.
We have seen the scientific evidence. We have heard the anecdotal evidence of women and yet, the best the minister can offer is another review.
Where is the commitment to treatment and testing? Where is the commitment to proper counselling and information about implants and the dangers they possess?
Where is the commitment to listen to women and ban silicone implants and refuse to allow their future use until such time as their safety has been demonstrated?
Where is the commitment of the Minister of National Health and Welfare to Canadian women?


CANADIAN OLYMPIC ASSOCIATION
Mr. Guy Saint-Julien (Abitibi):: Mr. Speaker, further to statements made by journalist Rejean Tremblay in La Presse on February 13, 1992 concerning the benefits enjoyed by senior officials of the Canadian Olympic Association at the Albertville Olympic Games to the detriment of Canadian athletes, I would like to give a summary of the income of the Olympic Trust of Canada from 1989 to 1992: advertising, $12.3 million; donations, $2.5 million; endowment fund, $16.4 million; federal government, $2 million, a mere 6 per cent of the total budget of $33.2 million.
The Olympic Fund is not financed by the federal government; this fund covers the financial campaigns of the Canadian Olympic Association. The federal government's contribution is limited to expenses related to running the organization and to the travel and accommodation of the official team at the Games.


FISHERIES
Mr. Francis G. LeBlanc (Cape Breton Highlands - Canso):: Mr. Speaker, the latest scientific evidence on the northern cod stocks has sent shock waves across Atlantic Canada, to the fishing communities across Newfoundland that depend on these stocks, and to communities in Nova Scotia, such as Canso and Port Bickerton whose fishermen ply these waters as well.
The findings confirm what several studies, including the Harris panel, and fishermen have been telling this government for more than a year.
These cod stocks are in trouble. The combined pressure by foreign overfishing, by a burgeoning and voracious seal population and, yes, by our own fishermen over the years is not sustainable. We cannot allow this

February 18, 1992
Oral Questions
vital resource to be decimated. This is not the time for finger pointing. It is the time for purposeful, decisive action.
This government must act immediately in concert with provincial governments and the industry to relieve the pressure on the northern cod. It must move, finally, to control the seal population and it must get tough with those countries, principally Spain and Portugal, that are blatantly overfishing these stocks. If they will not listen to reason, maybe it is time for stronger measures.


OLYMPIC GAMES
Mr. Marcel R. Tremblay (Quebec-Est):: Mr. Speaker, I am proud to address the House again today in praise of all the Canadian athletes at the Albertville Olympic Games.
First off, I would like to mention the performance of Miss Kerrin Lee-Gartner from Calgary, Alberta, who won the first Olympic Gold Medal for Canada in the women's downhill.
I am particularly proud of our athletes' showing in acrobatic skiing and I would like to personally congratulate someone from my region, Mr. Philippe LaRoche, from Lac Beauport Quebec, who won first place in the jumps, as well as his teammate, Nicholas Fontaine, from Magog, Quebec, who came in second.
Even though acrobatic skiing is only a demonstration sport and their medals are not taken into account in the final classification, these two athletes gave an outstanding performance.
Let me also underline our best Olympic performance in the men's biathlon 4 X 7.5-km race, where Steven Cyr, from Val-Cartier, Quebec came in tenth.
I am sure, Mr. Speaker, that you will join me in congratulating those athletes and in celebrating Team Canada's first victory over Germany just a few minutes ago, in overtime.


Mr. Bill Attewell (Markham-Whitchurch- Stouff-ville):: Mr. Speaker, some time this year Guyana will hold a general election. Guyana has a history of flawed elections. While some changes have been made under President Desmond Hoyte to reform the political system, the Guyanese government still has a long way to go.
Canada and other countries have to urge the Guyanese government to implement strict election reforms. Free and fair elections in Guyana must become a reality.
I want to be sure that Canada takes measures to ensure that the election will run smoothly and democratically. Canadian observers must be on hand to guarantee the Guyanese people a free and fair election.



ORAL QUESTION PERIOD


Hon. Jean Chretien (Leader of the Opposition):: Mr. Speaker, I have a question for the acting Prime Minister.
For two years now, the Minister of Finance and the Prime Minister have been telling Canadians that things are getting better. The Canadian people would like to believe them, but they keep hearing about new plant closures and lay offs every day on the news.
Just yesterday, Hyundai announced a three-day reduced work week for its plant in Bromont, Quebec. And today, Dominion Textiles announced it was closing its plants in Saint-Thimothee, Quebec, and Long Sault, in Ontario, with a total of 624 workers being laid off.
In his forthcoming budget, will the Minister of Finance forget about wrestling inflation and make sure that Canadians regain their dignity by getting back to work in well-paid jobs?
February 18, 1992


Hon. Don Mazankowski (Deputy Prime Minister and Minister of Finance):: Mr. Speaker, the hon. gentleman opposite takes great pride in citing negative news. Perhaps he might be interested in some good news. Today the Financial Post reported that store sales show signs of life. Department store sales bring hope to sector. Housing sales are up in January. I think those are all good indicators.
We know very well that we are going through difficult times. It is very difficult in pulling out of the recession, but the fundamentals are right. I think Canada is well poised to take advantage of the encouraging signs that are clearly on the horizon.


Joseph Jacques Jean Chrétien: Mr. Speaker, talking about somebody needing a bit of life, it is this government which should at this time do the right thing for Canadians.
I would like to ask another question of the Deputy Prime Minister or perhaps the Minister for International Trade.
The statement made by the Prime Minister in Peterborough talks about the NDP or the unemployed. It might be the same thing after the next election. I want to know if the Prime Minister-


Some hon. members:: Oh, oh.


Joseph Jacques Jean Chrétien: I am sorry, I wanted to be nice. I want to ask the minister if the statement made by the Prime Minister is true, and I hope it needs no correction, that the government has no intention of presenting a tariff list at the GATT by the end of this month concerning the products that should be excluded under the GATT list asked for by Mr. Dunkel.


Hon. Michael Wilson (Minister of Industry, Science and Technology and Minister for International Tirade):: Mr. Speaker, I hate to answer this question and get in between in this lover's quarrel over here, but let me respond.
The Prime Minister and a number of ministers met earlier today with farm leaders and talked about the GATT negotiations, in particular their response to the Dunkel text and the need to put forward tariff positions for March 1.
Oral Questions
We, as my hon. friend is very well aware, do not accept the Dunkel text as it relates to the supply managed product and our position, as put forward on March 1, will reflect that position. In other words, we will not put forward any tariffication numbers or anything such as is requested by the GATT Dunkel text.


FISHERIES
Joseph Jacques Jean Chrétien: Mr. Speaker, I am happy that there will be no list, but the problem remains the same in Canada. Because of the uncertainty created by this government, we see farmers being driven off the land everywhere in Canada. Now we see fishermen being driven off the sea.
Yesterday, the Minister of Fisheries and Oceans got up in the House and spoke a lot of words. What has been the reaction in Atlantic Canada? It is despair for 2,000 fishermen who will lose their jobs because of the mismanagement of this government.
I ask the Minister of Finance if his government will do something to preserve the dignity of these hard workers of the sea.


Hon. John C. Crosbie (Minister of Fisheries and Oceans and Minister for the Atlantic Canada Opportunities Agency):: Mr. Speaker, since there has been no decision made as yet with reference to the question of the total allowable catch of northern cod for this year or exactly what action will be taken in connection with the new advice from the CASSAC committee, no one can seriously estimate what the effect might be of any change to it until a change is made.
There will have to be changes and there will be an effect, but the statement that 2,000 fishermen will be out of work is very inaccurate. There will doubtless be some plant workers out of work and some trawlermen will certainly be affected, but I think the 2,000 fishermen figure is far too great an estimate.


Roger Simmons: Mr. Speaker, foreign overfishing is a matter of political will and would have stopped long ago if the Prime Minister had chosen to take it on.
The Minister of Fisheries' sin is not that he does not understand or has not spoken out on the issue, albeit belatedly. His sin is his continuing presence in a cabinet which by failing to act is ruthlessly trampling on the

February 18, 1992
Oral Questions
livelihoods of thousands and thousands of his own constituents.
Will the minister put the job security of those plant workers and those fishermen ahead of his own and tell the Prime Minister he can no longer aid and abet this cowardly bungling on the overfishing issue?


John Carnell Crosbie: Mr. Speaker, I am one of the few members of this House, if not the only member, who has ever resigned from a cabinet. I would be unafraid to resign from another cabinet if I felt it was not doing its duty for this country, but that is not the case. This government and this cabinet have done more with respect to the question of foreign overfishing and more to assist fishermen in Newfoundland and elsewhere in Atlantic Canada than any predecessor.
The problem of foreign overfishing is not a question of political will. It is a question of international law, that this country has no authority or jurisdiction whatsoever outside the 200 mile economic zone that was accepted by the world in 1977. That does not mean to say that our patience is inexhaustible. We have campaigns under way, I will not go into them now, for this year and we will be dealing with this matter in a forthright and an even more dedicated way than in the past during this calendar year.


Roger Simmons: Mr. Speaker, there he goes again. He continues as he has been doing to make some vague mutterings about what he might do a year or two down the road and in the same mouthful says he cannot do anything. Well, we do not have a year. What is the minister going to do, I ask him, now that his sweet talk has failed him and now that he has been abandoned by his political cronies over there. The only tool he has left is his integrity, and he has a lot of that. I ask him, will he put that on the line to light a fire under the Prime Minister to get this thing moving?


John Carnell Crosbie: Mr. Speaker, I do not have to put a match under the Prime Minister for him to do something. We are not in the kind of difficulty that the opposition party
is in. The Prime Minister has already brought this subject up and pressed these points home in meetings with President Delors and other leaders of the European Community, and he is going to continue doing that.
I met with him last night to discuss and plan what our next moves will be. We have his full support and he will be an invaluable help in this cause during this year.


Hon. Audrey McLaughlin (Yukon):: Mr. Speaker, my question is for the Deputy Prime Minister.
There are thousands of Atlantic Canadians who could be within days of losing their jobs. Certainly we are all concerned about the consequences for the people of Atlantic Canada.
The government was warned of the situation in the fishing industry two years ago and did nothing. The government was warned many years ago about the cost of overfishing the Atlantic region and did nothing. The Minister of Finance just said that they are getting the fundamentals right in the economy. Well, they did not get the fundamentals right for Atlantic Canadians. They did not get the fundamentals right for those Atlantic fishermen.
I want to ask the government and the Deputy Prime Minister why two years were wasted and what the government plans to do for those Atlantic Canadians who would be put out of work because of this government's mismanagement.


John Carnell Crosbie: Mr. Speaker, to say that the government was warned two years ago and did nothing may be fine as a piece of rhetoric, but it is certainly not factual.
Several years ago the government was told, not warned, by its scientific advisers that the advice given by them in the previous three years was inaccurate and they had to revise all of their forecasts. The government acted on that. The total allowable catch of northern cod has been reduced from 266,000 tonnes a year to 185,000 in the present year. That was action.
The Atlantic Fisheries Adjustment Program totalling $584 million was brought in to deal with the consequences. Is that nothing, or is the hon. lady opposite just
February 18, 1992

practising political rhetorical excesses in an attempt to gain points?


Audrey Marlene McLaughlin: Mr. Speaker, a supplementary for the Minister of Finance. The Minister of Finance said this government is getting the fundamentals right. I would suggest that the Minister of Finance talk to the 1,000 people who are out of work in Fishery Products International in Atlantic Canada, to those at Sears Canada where 800 jobs were lost in Atlantic Canada; Dominion Textiles where 330 jobs were lost; St. John's Shipbuilding where 250 jobs were lost, and so on.
I ask the minister, can Canadians expect to see some hope? Can Atlantic Canadians expect to see some hope in the budget which this government will bring forth and what is it going to do for those Canadians that its policies have put out of work?


John Carnell Crosbie: Mr. Speaker, the people in Atlantic Canada can see all around them the tremendous efforts being made by this government to create employment in Atlantic Canada.


Some hon. members:: Oh, oh.


John Carnell Crosbie: Mr. Speaker, noise is not going to drown out the truth, no matter how loudly the opposition shouts.
Just to give an example, in the last several years we have had an action program of ACOA. In the province of Newfoundland, 1,580 projects were assisted with $169 million, creating and maintaining over 17,000 jobs, not to mention the Hibernia project with a government commitment of $2.7 billion and hundreds of millions more committed to the fishery, just in one of the Atlantic provinces. That is a fine record, and one that I am proud to support.


Audrey Marlene McLaughlin: Mr. Speaker, Canadians have seen the fish go to Portugal, Spain and France. They have seen the jobs go to the United States and nothing for Atlantic Canadians.

Fishermen are in the same dreadful situation as farmers. Government has been warned. If it agrees to do away with marketing boards at the GATT negotiations,
Oral Questions
thousands of family farms will disappear and, with them, thousands of jobs. I ask the Deputy Prime Minister this: Is he prepared to sign that kind of agreement? If so, how will he make sure that all these farms will survive and all these jobs will not be lost?


Hon. Pierre Blais (Minister of Consumer and Corporate Affairs and Minister of State (Agriculture)):: Mr. Speaker, the Prime Minister and several of my colleagues were meeting with farm leaders just minutes ago. First, the Prime Minister has reaffirmed that the Canadian position is unchanged and that we will continue to vigourously support our farm product marketing boards.
At the same time, we have invited our farm leaders to take part in a European mission to meet with their European counterparts, to call upon both the political and farm leaders of these countries for support. Our proposal has been relatively well accepted. As a matter of fact, we are planning to meet again in a few minutes, after Question Period, with a hundred or so Canadian farm leaders gathered in an Ottawa hotel to discuss this issue further. I am happy to see that farm leaders and government are finally realizing that we have but one position and that we need to stand united if the Canadian position is to be successfully endorsed.


Mr. Fred J. Mifflin (Bonavista-TVinity-Conception):: Mr. Speaker, my question is for the Minister of Fisheries and Ocean.
I want to put another perspective on this foreign overfishing. The year 1991 will go down on record, a 15-year record, for being the year with the worst catch for Atlantic fishermen and the best catch for foreigners fishing the same stock, the worst of times for Canadians and the best of times for foreigners. That contrast is shocking. The comparison is atrocious and shameful, and I think the conclusion is very clear. Something has to be done now.
I do not care what the minister says. It is a question of political will. When will this government have the political will to stop talking and start acting?


John Carnell Crosbie: Mr. Speaker, I understand that the hon. member represents a great many fishermen. I can

February 18, 1992
Oral Questions
understand his frustration. I hope he can understand my frustration.
If it were simply a question of political will, there is no one in this House that has any more political will than I have. It would not be a problem any longer if it were a question of political will. It is a very delicate and intricate question of international relations where this country has no rights beyond the 200-mile limit.
It is not that there has been no action. I have outlined for the House all kinds of actions that we have taken. If the European Community and the nations that make it up do not pay attention to the steps we are going to have to take in the next month or two and to the advice that we have received from our scientists then we will know there has to be a change in direction in what we are trying to do to persuade them to observe and exhibit some conscience about the waste they are making of the assets that belong to the whole world outside the 200-mile economic limit.


Fred J. Mifflin: Mr. Speaker, my supplementary question is for the same minister.
I would suggest that the minister has a very short memory. On January 9 in St. John's on NTV, the minister was reported to have promised unilateral action if the European Community did not stop overfishing. Time has run out. They haven't. He hasn't. They won't. So when will he show the political will to take the unilateral action that he promised on January 9?


John Carnell Crosbie: Mr. Speaker, if we looked at the transcript I think we would see that nothing was promised in the extreme terms the hon. gentleman mentioned.
The government has taken many unilateral actions to deal with this situation. As I pointed out in a speech in London earlier in January, if nothing further is accomplished this year, if the European Community and the nations that have vessels registered in Panama and otherwise do not heed the cries of humanity that they should practice sensible conservation methods in the northwest Atlantic then anything is possible.


Hon. William Rompkey (Labrador):: Mr. Speaker, my question is also for the Minister of Fisheries and Oceans.
Two years ago in Black Tickle two million pounds of fish were landed. Last year not a single pound of fish was landed in Black Ticlde. Whole communities on the Labrador coast face being wiped out completely. Whether the minister likes it or not, he is accountable.
What answers does he have today for fishermen who face losing their livelihoods and their homes? What answers does he have for them today?


John Carnell Crosbie: Mr. Speaker, in my view, with the approaches that we have taken and we are taking, the fishery will come back and the northern cod fishery will flourish again. There is going to be a period when it is not flourishing.
With respect to Black Tickle, to take that particular instance, what did the government do? It brought in a nice compensation program that compensated every fishermen in Black Tickle who was prevented by ice from fishing. That compensation amounted altogether to $37 million.
Then the government brought in the Atlantic Catch Failure Program to help the fishermen of Black Tickle and other fishermen so that they became qualified for unemployment insurance. If the same terrible circumstance affects them again this year, similar kinds of assistance will come to them until they can properly fish again and catch as they were doing several years ago and as they are going to do again in the future.


Bill Rompkey: Mr. Speaker, the people of Black Tickle on the Labrador coast do not want handouts.
They want jobs and they want to be able to fish. They do not want simply to be looked after by this government. They live closest to the resource. Many of them are native fishermen, and yet their catches go down and the catches of foreigners go up.
How does the minister explain that, and when is he going to stand up for Labrador fishermen?


John Carnell Crosbie: Mr. Speaker, I believe that the fishermen
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of Labrador understand that the minister of fisheries cannot create the fish and that this is a problem that has arisen over a long period of years.
It is not a problem that is going to be resolved quickly. It may be several years before it is resolved or there could be a good fishery this year. We will have to wait and see.
In the meantime, the fishermen of Labrador are receiving assistance from the government to maintain them while this environmental circumstance or whatever the circumstances are that are causing this are overcome. We will continue to support them. That is all any government can do. I cannot put fish in the sea.
We have followed the scientific advice of CAFSAC all of these years. This circumstance has arisen despite the fact that Canada has always been very cautious in the TACs that Canada has set.


HEALTH CARE
James Capsey (Jim) Karpoff: Mr. Speaker, I have a question for the Minister of National Health and Welfare.
The Liberal premier of New Brunswick has now joined the Liberal premiers of Quebec and Newfoundland in seeking user fees for medicare which are strenuously opposed by the New Democratic Party.
In the words of Glen Clark, the B.C. Minister of Finance, "all four NDP administrations will be leading the attack on the federal government if Ottawa tries to water down the Canada Health Act to allow provinces to impose user fees".
Will the minister tell the Liberal premiers categorically that user fees will not be accepted in any disguise?


Hon. Benoit Bouchard (Minister of National Health and Welfare):: Mr. Speaker, I am trying to find the relationship between New Brunswick and British Columbia. Mr. Clark, Mr. McKenna and myself are having a little trouble because there is no relationship.
I already said to my friend and to all members of the House that I think it is legitimate for the premiers to look at the cost of the health care system.
Oral Questions
My predecessors and myself have always said that we believe that we do not have to change the rules or the principles. It is not our intention to do so. I do not understand why my friend is getting nervous.


James Capsey (Jim) Karpoff: Mr. Speaker, my supplementary question is for the same minister.
The minister also knows that the cut to federal medicare contributions which will amount to $4 billion next year are prompting these threats to our national medicare system. Since the cuts are substantially eroding provincial health services, will the minister live up to the Canada Health Act guarantees and restore funding in the upcoming budget?


Benoît Bouchard: Mr. Speaker, I am surprised the member does not know that all the provinces including those with NDP governments have already said that there was enough money in the system. This includes the member's NDP government in British Columbia.
In other words, 9 per cent of GNP in the country is enough to manage the health care system. At the same time, following the direction given by the Minister of Finance, we have to control the finances of the country. I believe what has been done was well done and moreover we do not believe, including his own friends, we have to put more money. We already do.


GENERAL AGREEMENT ON TARIFFS AND TRADE
Mr. Mark Assad (Gatineau-La Lievre):: Mr. Speaker, my question was intended for the Prime Minister, but I will direct it to the minister responsible for agriculture in Quebec. Last Wednesday this House unanimously adopted a motion asking for the Prime Minister's personal involvement in the GATT talks, with President George Bush and the President of the European Community, Mr. Jacques Delors. Could the minister let us know whether tomorrow the Prime Minister will be able to give us a detailed report on his meetings with these very influential figures on protecting and safeguarding GATT article XI?

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Pierre Blais: Mr. Speaker, we will do better than that. We won't do it tomorrow because the Prime Minister did it today. Only a few minutes ago he met with farm leaders, as I told the leader of the New Democratic Party.
The Prime Minister met President Delors for over three hours in Paris just a few weeks ago. He had conversations with the leaders of various countries, including Germany and the European Economic Community. He also had talks with the British Prime Minister. As he said this morning, he will be getting in touch with these leaders in the next few days to reaffirm Canada's position. As matters stand, we must feel we are supported by everyone here in Canada, and I would ask the hon. member to support farm producers and the government on the mission we will attempt once again when we go to Europe in the next few days to look for allies. I hope the hon. member will be with us to support us. That is what we need.


Mark Joseph Assad: I can assure you, Sir, that we stand behind our farmers, but I am not so sure the farmers believe you, and that is the problem.
The question is this. Last Wednesday, a motion was adopted by this House asking for the Prime Minister's personal involvement. That is what farmers expect to happen this week because they will be in Ottawa at one of their biggest gatherings. Can you give us the assurance the Prime Minister will make a personal commitment to these farmers?


Pierre Blais: Mr. Speaker, with respect, I will explain once more. The Prime Minister just spent two hours with Canadian farm leaders during which he unreservedly reaffirmed the Canadian position and our government's support for a position that we have been defending at GATT for two years. I realize this does not really suit the members of the Bloc Quebecois. They would rather see us miss the target, which would probably give them a boost at the national level. However, we intend to defend our position, no matter what. We stand behind our farm producers and we will continue to defend them.



Mr. Maurice Foster (Algoma):: Mr. Speaker, my question is for the Minister for International Trade. The Prime Minister said in Peterborough last Friday that Canada would not be filing tariff schedules on March 1 as required in the GATT arrangements.
I want to ask the Minister for International Trade if this means that Canada, when it files its commitments for agriculture, will simply be providing that import controls for those supply managed products will be provided through a strengthened and clarified article XI. If that is the case, will the government be getting the support of the other five nations who support our position for a strengthened and clarified article XI?


Michael Holcombe Wilson: Mr. Speaker, in response to a question from his colleague just a few minutes ago, I said that we would not be filing tariff schedules on the supply managed products. We will be filing tariff schedules on all other products so that we will be fully engaged in negotiation.
As my hon. friend is well aware, and I know he supports the position that we are taking, we are seeking a strengthening and clarification of article XI. We believe the approach that we are taking on March 1 is fully consistent with that.


Maurice Brydon Foster: Mr. Speaker, I think we would be much more comfortable if the government would simply be filing with the GATT negotiations that we want to maintain our import controls through a strengthened and clarified article XI and that we would seek the support of the other five countries that support our position.
Last week the House of Commons passed a joint resolution calling on the Prime Minister to become personally involved in the GATT negotiations, to meet with the President of the United States and the President of the European Economic Community.
Farmers want to know what the government has accomplished in six years of negotiations. We have only five countries supporting our position. What has the government actually accomplished? When is he going to
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meet with the two presidents? When is he actually going to accomplish something to save these farmers and
100,000	Canadian jobs?


Michael Holcombe Wilson: Mr. Speaker, my hon. friend is very well aware that the Prime Minister has been very much engaged in this issue for a number of years now, going back before the 1986 summit.
The Prime Minister met with farm leaders, went straight to the Tokyo summit and put agricultural issues on the summit table for the first time. That has continued at every summit since then. It also continues at a number of other meetings that the Prime Minister is involved in, some of which are not related to agriculture but the Prime Minister brings those matters up at the meetings because of the seriousness with which he views these agricultural issues. He has raised this matter with other G-7 leaders.


THE BUDGET
Mr. Rene Soetens (Ontario):: Mr. Speaker, the government has been involved in some very extensive consultations with numerous people, not only the first ministers in a very public meeting here in Ottawa, but through numerous other consultations. Even in this House the government gets lots of free advice on the budget.
I would like to ask the Minister of Finance if he has completed his consultation process and is he ready to announce the date of that budget?


Donald Frank Mazankowski: Mr. Speaker, I can advise my hon. colleague and the House that it is my intention to bring a budget down on Tbesday, February 25.


GENERAL AGREEMENT ON TARIFFS AND TRADE
Hon. Lucien Bouchard (Lac-Saint-Jean):: Mr. Speaker, my question is for the Minister of State for Agriculture and concerns the government's position on protecting marketing boards and article XI.
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What we want to know from the government is not all the meetings that were held, the trips to Europe, the telephone calls with our European friends and how long the calls lasted. That is not what we want to know, Mr. Speaker. What we want to know, and I ask the minister, is whether he is prepared on behalf of the government to refuse to sign any agreement that would not maintain article XI and marketing boards.


Pierre Blais: Mr. Speaker, I will certainly not compete with the hon. member for the number of times we have been to Europe. I know that he would win in that department.
However, I will not allow the member for Lac-Saint-Jean to play politics on the backs of Quebec farmers. Since 1990, when we tabled the Canadian position, it has not changed. It was restated today, and in a common effort, which I hope my colleague will support us in, we offered farm leaders a chance to go with a group of government ministers to Europe to restate the Canadian position once more. There is no difference, no division on the Canadian position. There is no division. Our position is clear. The Prime Minister reaffirmed it this morning. I think that should reassure the hon. member.


Lucien Bouchard: What the minister is telling us, Mr. Speaker, is that he gave farm leaders an opportunity to go with him to Geneva to share the blame for this government's failure with him. The question is simple and I would ask the minister as well not to play politics. Here is a simple question that all farmers in Canada are now asking: Will the government sign an agreement rejecting article XI and marketing boards or will it not?


Pierre Blais: Mr. Speaker, I believe that we have always said we would defend farmers' interests and the facts are there to prove it. But if my hon. colleague absolutely wants to frighten Quebec farmers, he should rather tell them about the risks of separation for a province and for Quebec farmers who produce 50 per cent of Canada's industrial milk. That danger is much greater. The risk that you would have Quebec farmers run is much greater and farmers

February 18, 1992
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will see their interest in staying in Canada to defend milk producers. There is no doubt about that in my mind.


FORESTRY
John Williston (Bud) Bird: Mr. Speaker, I have a question for the Minister of Forestry.
About a year ago the forestry subcommittee submitted a report to this House in which it recommended a framework to attain the vision of sustainable development in Canada in concert with provincial jurisdiction for forest management.
In its response the government accepted the concept of a Canada forest accord as a beginning to achieve sustainable development in our forests throughout this nation.
I would like to ask the minister if the Canada forest accord will be signed at the forthcoming National Forestry Congress to be held here March 1.


Hon. Frank Oberle (Minister of Forestry):: Mr. Speaker, as my friend has said, we are organizing a National Forestry Congress early in March under the auspices of the Canadian Council of Forest Ministers. This congress was preceded by the most extensive public consultation process possible; five regional conferences, the green plan, and of course the committee's report.
I am currently working with my provincial colleagues on the text of an accord, which hopefully all of us could sign, together with special interest groups that have a stake in forestry.


UNEMPLOYMENT INSURANCE
Mr. Cid Samson (Timmins -Chapleau):: Mr. Speaker, my question is for the Minister of Employment and Immigration.
Last week the chairperson of the finance committee called for a 25 per cent reduction in UI benefits. Given that unemployed Canadians already suffer a 40 per cent reduction in income, and considering that a shorter
benefit period will reduce the possibility of unemployed Canadians having access to training, I ask the minister to reject the cruel and ruthless comments made by his colleague last week.


Hon. Bernard Valcourt (Minister of Employment and Immigration):: Mr. Speaker, certainly I will not entertain a debate during Question Period on the merits of the UI program. But I do not want to leave untouched a statement that UI recipients will receive less money for training.
If the hon. member would care to look at the record, he will find that in 1992, instead of spending $600 million to train UI recipients, we will spend three times more, $1.8 billion.


Cyril (Cid) Samson: Mr. Speaker, perhaps some training might be in order for the minister.
Many unemployed Canadians do not have access to training because their benefits run out before they are introduced to a program. Many unemployed Canadians do not have access to the training programs because of the severance pay restrictions. These people have a right to training.
Is the minister prepared to ensure that the situation is corrected and provide training opportunities for those unemployed Canadians?


Bernard Valcourt: If the hon. member and the socialist party are concerned about training for Canadians, they should stand up, apologize to the unemployed people and support the principle of activating passive money under UI which they oppose every step of the way.


EXTERNAL AFFAIRS
Ms. Sheila Copps (Hamilton East):: Mr. Speaker, my question is for the Secretary of State for External Affairs and it concerns the Canadian hostage this government has been ignoring for seven years.
In October, the minister told this House they were doing everything they could to find the hostage, Hen-riette Haddad. She said they had conducted, and I quote: "exhaustive inquiries". She backtracked on that 10 days ago in this House.
February 18, 1992

Today, however, we read in Le Devoir that neither her sister-in-law nor her niece, the last two persons to have seen her immediately before she was abducted, were ever contacted by Canadian officials.
How does the minister explain this total failure in the discharge of her duties?


Hon. Barbara McDougall (Secretary of State for External Affairs):: Mr. Speaker, we have been through this case a number of times in this House. Both my officials and myself as the minister have explored all the possibilities we are aware of concerning Madam Haddad. We did the same thing through the United Nations. I raised it when I was at the United Nations in the fall.
Unfortunately, this story has not had a happy ending. Throughout this situation we have maintained close contact with Mrs. Haddad's family.


Sheila Maureen Copps: Mr. Speaker, not once, not twice, but several times the minister has insisted in this House that she has taken every opportunity available to try and find the only Canadian being held hostage in Lebanon. However, we learned today that the two family members, the last people to see Mrs. Haddad alive, were never contacted by the Canadian government.
How can the minister stand in the House and claim once again that she has done everything possible when she has not even talked to the last few people who saw Mrs. Haddad alive?


Barbara Jean McDougall: Mr. Speaker, I responded to the first question which was the same as the supplementary question.
Let me just say that this has been an unfortunate and tragic situation for the Haddad family. The son of Mrs. Haddad was kind enough to send me a note thanking me for my efforts and those of my department in this case.


EMPLOYMENT
Mr. Bob Kilger (Stormont-Dundas):: Mr. Speaker, my question is for the minister responsible for employment.
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Today, Dominions Textile announced the closing of its weaving mill in Long Sault, Ontario, and its finishing plant in Saint-Timothee, Quebec. This will mean a loss of job for over 600 Canadian men and women.

For two years we have been asking the government to implement an economic development program for eastern Ontario.
Given today's announcement by Dominion Textiles, will the minister undertake to provide eastern Ontario with special program status similar to northern Ontario and certain regions of Quebec as it relates to industrial programs?


Bernard Valcourt: Mr. Speaker, I am certainly ready to look at the specific case which the hon. member raises. The people of eastern Ontario should get the attention they deserve and the programs of my department should be relevant to their needs.
I am ready to look at the situation. Any measures we can take to ease the situation of these workers, I will do.


Robert (Bob) Kilger: Mr. Speaker, my supplementary question is for the same minister.
Recognizing that the people working in the Dominion Textile plant at Long Sault need help now, would the minister, at the very least, give his commitment to instruct his officials immediately to provide industry adjustment services in conjunction with the economic development officer for Stormont, Dundas and Glengarry to assist these workers?


Bernard Valcourt: Mr. Speaker, I have no hesitation at all in instructing officials of my department to look at this case immediately and provide whatever assistance is possible to these workers.


CROSS-BORDER SHOPPING
Robert Alfred Corbett: Mr. Speaker, my question is for the Minister of National Revenue.
The abusers of cross-border shopping are diverting billions of dollars out of the pot that pays for our social programs such as medicare, et cetera. Has the minister considered a plan which would deal specifically with

February 18, 1992
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abusers of cross-border shopping and their current right to access these programs?


Hon. Otto Jelinek (Minister of National Revenue):: Mr. Speaker, it is true that every dollar that goes south of the border is a dollar less for our superior social programs or a dollar that could go toward reducing the deficit or a dollar that could go toward reducing taxes.
We have been working on this matter on a regular basis. The announcements that were made by this government just last week go a long way toward creating a level playing field. If the provinces would move toward harmonization it would go even a step further.


Mr. Speaker:: I will hear a single question from the hon. member for Thunder Bay-Atikokan, followed by a single question from the hon. member for Selkirk.


AIR DISASTER
Mr. Iain Angus (Thunder Bay-Atikokan):: Mr. Speaker, my question is for the Minister of Transport.
On July 11, 1991, a Nationair DC-8 crashed at Jiddah, Saudi Arabia killing 261 people, including 14 Canadian crew members. Weekend reports in The Montreal Gazette and The Ottawa Citizen detail allegations of improper maintenance and pilot error.
Will the Minister of Transport immediately release the post accident safety review of Nationair, as well as any other inspections conducted by his staff between the accident and particularly after the time he promised this House an increase in surveillance of that airline?


Hon. Jean Corbeil (Minister of Transport):: Mr. Speaker, I am pleased to inform the hon. member that Nationair, since this unfortunate accident, has been subjected to a most severe inspection by the Department of Transport. Our inspectors have reported that this airline is following the inspection requirements of the Department of Transport.
As far as the inspection reports are concerned, we do not intend to make them public because it would not be in the best interests of the public. These inspections
contain confidential information that people gave to us because these reports are kept confidential.


JUSTICE
Mr. David Bjornson (Selkirk-Red River):: Mr. Speaker, I have a very brief question for the Acting Prime Minister.
In light of the decision made yesterday by the Federal Court of Appeal which allows inmates of federal and provincial prisons to vote in elections, is it the intention of the government to challenge this particular decision?


Hon. Doug Lewis (Solicitor General of Canada):: Mr. Speaker, officials of the Department of Justice are presently reviewing the decision to see whether or not an appeal is warranted. As well, there is a case in the Ontario Court of Appeal and we are awaiting the decision. The facts are very similar. There is also the recent report of the Electoral Reform Commission.
After reviewing all of these matters, the officials of the Department of Justice and the Minister of Justice will be in a position to consider whether or not to appeal.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Mazankovski that Bill C-56, an act respecting the control of government expenditures, be read the second time and referred to Legislative Committee E.
The Acting Speaker (Mr. DeBlois):: When the sitting was suspended at one o'clock, the hon. member for Kingston and the Islands had eight minutes left.
I shall therefore give him the floor.


Peter Andrew Stewart Milliken: Mr. Speaker, when the House adjourned at 1 p.m. I was decrying the evils of the bill the government has intro-

February 18, 1992

duced before the House. The bill itself does not have anything offensive in it. It is just a silly and ridiculous piece of legislation. Frankly as I have indicated before, it is a complete waste of the time of the House.
One of the principal reasons I put forward for the House's consideration as to why the bill is so ridiculous is the holes that it leaves, in what it claims to be its efforts to control government expenditure. There are two principal omissions from this legislation. First, the legislation does not control interest payments on the public debt. Those interest payments are allowed to go unchecked.


The Acting Speaker (Mr. DeBlois):: Order please. I ask the collaboration of all members in this House. The public wants to listen to the intervention of the hon. member.


Peter Andrew Stewart Milliken: Frankly, I am pleased that there are members here. At least there are some ministers here now. There were none this morning during my speech. I am delighted that they have re-appeared. Obviously my words have inspired them to greater efforts.
The interest payments on the public debt are excluded from the consideration of this bill. If the interest payments on the public debt go out of control because the government raises interest rates, they are not subject to the over-all government expenditure plan. The deficit could increase out of control every year if interest rates take off and the government is forced to pay more interest on the public debt, or if the government runs up the deficit as it has in the past and forces the interest amounts to increase.
It is fine to say the government has no responsibility for that. With great respect, it does have considerable responsibility for it. If the government was serious about putting a cap on government expenditures, surely it would include interest payments on the public debt, particularly when those interest payments constitute the largest single expense the government has. My recollection is that the government is paying out $38 billion a year. Perhaps my colleague for Sudbury can confirm that figure. I believe it is the interest figure being paid annually by the government at this stage.


Mr. Duhamel:: $43 billion.


Peter Andrew Stewart Milliken: My friend for St. Boniface suggests that maybe it is $43 billion. Whatever it is, it is a very substantial figure. Those amounts are not subject to any spending restraints under this bill.
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This is for restraint of government expenditures but it only applies to certain expenditures. The biggest single one is excluded. The government says it cannot take any responsibility for that, although the responsibility is direct and four-square. It rests clearly on the shoulders of the government. It is charged with managing the Canadian economy, not the opposition, and yet it says it cannot be responsible for that and will exclude it from the bill.
That is the first serious weakness in the bill. It indicates how silly and ridiculous it is for the government to bring forward this kind of legislation in this House. I am glad to see my colleague from Willowdale agrees.
The second aspect of this bill which is so silly is the lack of control on tax expenditures. Members may ask what tax expenditures are. The government may give a tax break to a group in order to induce some particular aspect of the Canadian economy. For example a special writeoff may be given on the development of a gold mine. Those operating the gold mine will not have to pay taxes during a certain development period, and obviously the government will forgo revenue. That is called a tax expenditure. The government gives up its right to tax the gold mine and bring in revenue it might otherwise get.
By introducing its budget the government says that it will give a preferential tax break to certain people in order to induce them to spend their money in a particular way.
It may give a child tax credit, for example, to those who have children to either encourage them to have children, or to assist them in paying the costs of looking after the children.
The tax break is a tax expenditure. It is giving away or forgoing revenue in order to achieve a desired result. This is all perfectly proper, but if you have a cap on expenditures, why would you not also cap tax expenditures?
Yet the government has left itself a free hand to spend the tax dollars that it does not actually bring in. It is saying in this bill that it will limit the amount of tax dollars it spends on everything except the public debt, but will not in any way restrict its right to forgo tax dollars and not bring them into the pot.

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In other words, give tax breaks to its wealthy friends, the Tory fat cats. They are the same people who got the tax break when this government took office and have been getting them all along ever since. That is what the government is proposing to do. It is saying it is not going to be hamstrung in any way by legislation in the House of Commons that restricts its ability to give those tax breaks, in other words to make tax expenditures.
If the government was serious about controlling government expenditures, surely it would deal with that issue in a straightforward and responsible way and include that in the bill. It has chosen not to do so.
The third argument against this silly legislation, this ridiculous bill, was made by the minister himself. The poor minister stood there, and really he must have been very embarrassed to have to introduce this kind of legislation in the House.
Yet his argument was that if any government wants to change this in future, when it introduces its budget making the change, it will have to introduce an amendment to this act as well. Imagine, what could be simpler?
If you do not like the restrictions in the bill, you introduce your budget proposing higher expenditures and in the budget you announce there will be changes to this bill. It happens every day in every budget.
The government announces that there will be tax changes. It announces the tax changes in the budget and then it introduces a bill to amend the Income Tax Act. That is all it is going to do with this bill. It is exactly the same thing.
This is nothing but a scam as the hon. member for Broadview-Greenwood so ably says. This is ridiculous. It is silly and it should not be allowed.
The ministers of the Crown who have an obligation to be here and participate in debate absent themselves from this Chamber when government bills are under discussion. It is a national disgrace.
If they are going to bring in silly bills like this, the least they can do is sit here and listen to the debate. They choose to absent themselves in their entirety, 39 of them. It is wrong. They have an obligation as members of this House to sit here when government legislation is under consideration.
If they are going to propose something so stupid, the least they can do is listen to the debate.


The Acting Speaker (Mr. DeBlois):: I should just like to point out to the hon. member that the presence or absence of members is always a touchy issue and that his remark could apply to member on both sides of this House this morning. We shall now proceed to the question and comment period. The hon. member for Broadview-Greenwood.


Dennis Joseph Mills: I think you would have to agree that when we have close to 3 million people in this country out of work and the fishery plants are closing down in Atlantic Canada, it can be very frustrating when you get a sense that the government is not listening to anything we say on this side of the House.
To add insult to injury, the government brings in a bill today that obviously signals it has no legislative agenda. There is absolutely no prepared legislation on that side of the House that will enable us as national parliamentarians, to pass programs that will put people back to work.
The people of Canada should know what the government does because of this absence of a legislative agenda. They throw in some little smoke and mirrors bill, as my colleague from Kingston and the Islands has described so properly before. If he gets a little frustrated, it is only a mirror of the frustration of the people of Canada.
My question to my colleague from Kingston and The Islands has to do with the millions of people who are unemployed in this country who are looking to us as national politicians to address this issue. He is a man who has spent thousands of hours on the floor of this House, enabling legislation to pass quickly when it was constructive. Does he not feel that it would be a much more effective use of our time as parliamentarians to be debating issues and legislation that would put people back to work? Could he please address that in terms of how the process works and what we really could be doing in this House to address the number one problem this country faces?


Peter Andrew Stewart Milliken: I thank my hon. colleague for his question. I quite agree with him that we would be far
February 18, 1992

better off debating legislation that tries to assist in getting Canadians back to work.
In the course of his question, I pulled out my copy of the Order Paper to see if there was anything the government had on its list of bills that we could be discussing that dealt with this kind of subject. I looked in vain. I did not see anything that is proposed by the government at this stage that would create jobs for Canadians. I suspect this government has no idea what to do. I think it is paralyzed with fear. It is afraid of a defeat at the polls which it knows is imminent. It has no idea how to create jobs in this country. It was elected on the promise of jobs, jobs, jobs.
It claimed credit throughout the years the economy was growing so well as a result of the policies of the previous Liberal government which they did not change. In my earlier comments this morning, I pointed out how it said if it did not change them and get expenditures under control, government expenditures on programs would be up about 56 per cent, I think it was, by 1990-91. In fact it was up by 69 per cent because it did not change them. It augmented the programs of the previous government and there was prosperity for many years in Canada. The government did what Nero did-he fiddled while Rome burned-because the underlying problems in the economy were not being addressed. The underlying problems of the government debt were not being addressed in those boom years and now it comes into a time of financial crisis. It has worked itself into a state of apoplexy because it doubled the national debt and realized that the interest payments were becoming quite crippling. Then it said it had no more money to spend on job creation programs. So it sat and cut back on funding for job creation programs-


Dennis Joseph Mills: On training.


Peter Andrew Stewart Milliken: And on training-a vital statement by my hon. colleague-at the very time when Canadians needed them most. It is a complete dereliction of responsibility and duty that the government has exhibited here. The training scam is exemplified-oh, a minister has come back, we can rejoice-by the fact that it has introduced this bill C-21 which cuts back benefits to the unemployed at a time when unemployment is going up. It cut back the availability of funding for training. Then it sticks the whole cost of training on to the shoulders of the private
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sector, the workers and their employers, instead of shouldering its own responsibilities which Liberal governments have taken as essential in this country, and with the support of the NDP I am glad to say.
Now we see this change in policy, these cuts, this slashing, at a time when the economy needs exactly the opposite kind of treatment. It is the wrong policy.


Ron J. Duhamel: Mr. Speaker, I have three questions which I will try to answer. My first question is: What is the exact nature of this bill? My second: Why is it being tabled today? And my third: Are there alternatives to the solutions proposed by the government?

What is C-56? On the surface it states it will control the expenditures over five years to an average increase of 3 per cent. That is what the paper says. I find it really astonishing that it talks about the control of expenditures, and that is important, but it does not set any deficit or debt targets. With the deficit and the debt being as serious a problem as it is today and the fact that they talk about it often is something that I would have believed they would have attacked in this particular piece of legislation, that they would have tried to do something about it.
Why is the government introducing this particular piece of legislation, this control on expenditures? On paper it looks really good. Perhaps the government believes that the Canadian public will believe that this is really going to make a difference. Is it really a serious effort? If it is such a good idea, why was it not introduced sooner? The Conservatives have been in power for seven years or so. Or, is it nothing perhaps but smoke and mirrors, a lot of glitz, propaganda to try to make people believe that finally they have taken control of things? They have not taken control of things. They have not. The government is actually reaping what it has sowed. What has it sowed?
We know that there was a made-in-Canada recession. The Prime Minister indicated that. We know that there has been a continued high dollar. We know that interest rates have been extremely high. They have come down a bit, but the real interest rate, the difference between inflation and the actual interest rate, is still really

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significant. We know that this country has 5 million Canadians living at the level of poverty or below, most of whom are women, over 1 million of whom are children or young adolescents. We know that there are 2 million people as we speak who are on social assistance, that there will be 2 million Canadians who will be fed by food banks this year. We know that there are roughly 1.5 million unemployed Canadians right now, perhaps more, people who have given up, people who do not believe it is worth looking anymore. We know that a lot of these people, the majority, want to work. They desperately want a job to which they can make a commitment.
We know that the government's deficit this year is in the neighbourhood of $30 million, and will probably be in excess of that in spite of the fact that the interest rates came down. That should have saved it some money. We know that the debt is in excess of $400 billion. There is an interesting dialogue, debate, discussion about the interest rate.
I want to introduce into my address today a direct quote from an answer from the former minister of finance, the present Minister for International Trade, to my question as to what the debt really was at the end of the fiscal year that they came into power. I read for the fiscal year 1983-84 the figure for the national debt at the end of that year was $167,985 million. I want to read that into the record because of the debate as to what it really was. Some people like to exaggerate, to suggest that perhaps the fact that it is more than double is not nearly as serious a matter as a lot of people would like to pretend it is. It is a serious matter. It has more than doubled. It has more than doubled because the government underestimated the impact. Surely when you buy a company and it has a debt, you fold that into your planning. You make sure that you take that into consideration. You do not go forward and behave as if you had no debt. When the Conservatives took over government they should have done the same thing.
It is also interesting to note that Canada's debt is growing faster than all of the G-7 countries with the exception of Italy. That should be troubling for all of us who are really quite concerned. We should note as well that the debt service charges as a percentage of our gross domestic productivity has continually increased since this government took office.I think that is an accurate statement. I have checked it out and I am told that it is. Obviously that is a serious matter as well.
What is it that it has done to try to control expenditures besides bring in this piece of legislation today. You and I both know that it has been off-loading in a massive kind of way to the provinces. We have talked often about off-loading health, education and social assistance programs. In fact, just recently it was talking about a particular bill that dealt with the capping of social assistance to the provinces of British Columbia, Alberta and Ontario.
I have mentioned time and time again in this House that between the years 1986 and 1995, almost a decade, there would be 30 billion fewer dollars transferred to provinces for health and education matters. I find that shocking in spite of these massive reductions, these cuts, the slashing that the deficit is still where it was for the last 6, 7, 8, 9, 10 years and the debt has more than doubled.
We have to take it in the context of the revenue as well. If you owe a certain amount of money, the next natural question is how much do you earn, what are your assets? It is rather interesting to note that the government's revenue since it came into power has increased by roughly $60 billion. It is not far from doubling its revenue. The obvious question is where has all Canadians' money, in the form of taxes, gone? In spite of these massive tax increases, 34 with the goods and services tax, an increase of $60 billion roughly in revenue, the deficit is roughly at the same position and the debt has more than doubled. We are losing ground in spite of the fact that we are paying more and more.
The government, in introducing this legislation, will cite the U.S. experience with similar types of legislation. I would like to draw attention to two or three points. First of all, we have different systems of government. Virtually everyone is aware of that. The legislation is significantly different. What is not well known, and what has not been repeated often, is that this U.S. legislation has not been terribly successful. The U.S. has had to go back and adjust its targets in order to make them fit its estimates, and so on.
To try and give people some reassurance is the thing to do when they are upset about the deficit and the debt. In terms of what it will actually accomplish, there are serious doubts in my mind and in the minds of many
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people who have studied this legislation, looked at the critiques and have thought about the legislation.
I repeat that the government's intention, at least on paper, is to control the expenditures. It may or may not do that. I am not trying to suggest that the government has simply done this and that in order to try to fool people, but there is an element of that. I am troubled by that.
This bill says nothing about the possibility of giving tax concessions to friends, and I say friends in the broadest sense of the term. It could create a number of loopholes that would still favour individuals, that would still contradict or counteract some of those expenditure controls that are in place. That is really unfortunate. I should point out that not only is this my criticism, but government members of the finance committee have raised this same point.
The government imposes limits on spending based upon certain assumptions being made right now, obviously. We see this in the control of spending over five years to an average of 3 per cent, as I indicated initially. It has to make assumptions about inflation, interest rates and unemployment rates. Those are three variables, and there are probably others.
If we were to go back and review the assumptions and the predictions that were made in previous exercises, we would find that the targets were way, way off. The targets did not resemble reality once that reality came to be. If that is correct, we need to ask a couple of other questions. What should give us confidence that those predictions, those assumptions that the government has to make will be better than those of the past? There is no evidence to that effect. If you build a model based on certain assumptions, how can you have confidence in that model? You really cannot.
Therefore, I am led to that great suspicion that this looks good, sounds good and is going to fool some people, but really will do nothing to attack the root problems of the deficit, the debt and the economic situation that is troubling Canadians today; a very serious one indeed.
I want to point out as well that there is a possibility, and I can assure you that others have thought about it, that the government could go on a spending binge. We are very close to an election, we all know that. It could be weeks, months or perhaps a year away. The government
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could make a number of promises, recognizing that if it were re-elected, it would have to deal with it and it would do so as best it could. It could make those promises, recognizing that it might not be re-elected, and really stick it to the party that forms the next government.
There are controls in place and those controls are obviously there as a result of decisions made by previous administrations. That makes me awfully nervous and I suspect it would make some other Canadians extremely nervous as well.
I say gently that the intent on the part of certain individuals is no doubt rather noble, but it is rather naive. It is simplistic. The problems are much more complex than this. This bill will probably end up being nothing but window dressing. It will look good but it will not do the job.
What do we do? The first thing we need to do is restore the confidence of the Canadian people in their politicians and in their political parties. As well, we need to ensure that we do not over-react to the deficit and debt. We need to take it seriously, responsibly, without losing our bearings. If we start reacting too strongly one way or the other, Canadians will not believe us. Therefore, we need to re-establish confidence in political parties and in politicians.
We need to state very honestly what needs to be done with the deficit and debt, and where we are going to get the funds to address the serious overspending. We need to address some of the serious economic and social problems of the nation. We need to be up front. Once we have done that we will have gone a long way in establishing the right kind of climate so that people can once again believe that we might get this situation under control.
We also need to get people back to work. If we were able to get people back to work, the debate in this country on a number of issues would calm down and would become much more rational. We would have people contributing much more than they are now to our country's future.
We need to get people off the unemployment insurance lists. While they are there they are costing us money. They are not there because they want to be, but because there is no choice, there are no alternatives. If

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they were able to get back to work, they would be contributing rather than being a drain on the treasury.
We need to get them off the social assistance programs because those are debilitating. They make you feel as if you do not belong, as if you are not important any more, as if you are not doing what you ought to be doing. It is a lose, lose and lose again situation.
The dollar really needs to be looked at. We know what would happen if there were a lower dollar. We need to ensure that the interest rates continue to come down. A lot of people are saying that they are really down quite a bit, and they are, but let us look at the difference between inflation and actual interest rates. Let us look at the difference between the interest rates in the U.S. and the interest rates in Canada. There is still a lot of work to be done.
I would like to remind my colleagues in this House that there have been some proposals made. I have made a few and I am going to refer to some proposals that have been made by my own party.

In his emergency plan for the economy proposed a few days ago, the Hon. Jean Chretien, Leader of the Liberal Party, asked for an initial downpayment of 5 per cent on the purchase of a first home. He felt it was a way to stimulate the economy. He mentioned the possibility of people using an RRSP of $7,500 to purchase their first home, which would also help put people back to work, stimulate the economy, create jobs and restore the confidence of those who are now unemployed. He indicated the need for shared-cost programs to update community infrastructures. He talked about a number of projects that could be carried out in our cities, our towns, and the provinces in general, again to create employment and ensure that people can get back to work and start feeling a lot better than they feel now.
He also said that he wanted to intensify basic manpower training, because he realized that basic skills were not sufficiently developed. This was a way to ensure that in the near future people would be able to go back to work and contribute fully to our society.
Finally, in his fifth point he mentioned federal emergency assistance for food banks. At the beginning of my speech, I mentioned that two million Canadians would
be fed by food banks this year. I think that is terribly sad. And 40 per cent of those Canadians will be children and teenagers.
Mr. Speaker, you will recall that a month ago, the leader of my party, the Hon. Jean Chretien, proposed a long-term recovery program. I would like to remind my colleagues of these proposals:
Rebuild the industrial fabric of Canada by slowing disindustrialization; by bridging the gap between Canadian and American interest rates, in particular real interest rates, and by lowering the value of the Canadian dollar. We also asked for a fair fiscal policy.
Third, to implement effective retraining programs.
Fourth, to ensure a more balanced economic growth.
And, finally, to take on an important budgetary responsibility. I would like to conclude by discussing this last point. It seems to me that if we took on an important budgetary responsibility, we could reach the goal proposed here in a very flexible, honest, professional and effective way.
In concluding, I simply want to say that yes, on paper, the intent of Bill C-56 could be seen as being rather noble, and it might even look as though there is some need for that legislation. However, when you analyse this piece of legislation, when you look at it as a whole, you find some serious deficiencies. The government intends to tighten controls as regards expenses, and that is important, but there are all kinds of ways to thwart that intention. We are also very aware that what has occurred, that is the passing of the tax burden to provinces, will become an even more common occurrence. Then you realize that the tax burden of the provinces is already very heavy for some of them; in fact, it is extremely heavy.
So, if I look at all this, I firmly believe that some of my colleagues from the government think this is a good idea, that those are good intentions, and I accept that. However, I am well aware that some people have already spent enough time in a bureaucratic environment to know very well that this effort, this initiative, will look very good and that it might even fool some people and make them believe that this a substantial measure. Yet, in the end you will see that the achievement will be a rather small one.
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Nevertheless, I wish the government luck. There is no denying that the control of the deficit and of the debt is a very important issue. Let us not forget the most important thing, which is to put Canadians back to work, to restore their confidence again in their country and in the political parties that try to govern our great and beautiful country. I thank you, Mr. Speaker.


Dennis Joseph Mills: Mr. Speaker, I want to compliment my colleague on his remarks. Once again we have heard from this side of the House that we do have ideas over here and we are putting them forward in a constructive way. Quite often we hear the government during this debate saying that we are not putting forward ideas. We are also respecting the concerns of the deficit and debt of this country.
My colleague from St. Boniface has had lots of experience, being a former deputy minister in the field of education in the province of Manitoba. My question to him has to do with training.
I have constituents coming into my office weekly saying to me that the government is always talking about training, retraining and more training and that people are putting funds into it. Time after time people come into my office with concerns about applying for these training courses. I had a specific example last Saturday in which a constituent of mine, Billy Turner from Wolfrey Avenue, came in with his file and said: "When I go to George Brown College, Humber College or York University they all tell me they have run out of money. There are no more funds. The cupboard is bare".
Last week the Minister of Employment and Immigration kept talking about money for training and retraining. The Minister of Industry, Science and Technology talked about it yesterday. Yet all I hear is that there is no money in these programs when people apply.
As an educator, and I ask my colleague specifically as a former leader in this field, does he not think that the government is being irresponsible by not finding the necessary funds to train and retrain these people, especially when they are in the ranks of the unemployed?
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Ron J. Duhamel: Mr. Speaker, I want to thank my colleague from Broadview-Greenwood for a question that is extremely important.
There are several dimensions to his question that I want to respond to. The first one is, yes, we need to find money to respond to people's needs today because those individuals who are not being served cost the state money. They are on unemployment insurance, on social assistance, or on some other government program that does not help them very often to get back into the work force. It is a drain, and I do not say that in the pejorative sense. They are entitled to a quality of life, but at the same time the possibilities of significant quality are not great under the current circumstances for many of them. Yes, we need to respond.
What happens very often is that a certain number of dollars are put forward and people believe those dollars are going to respond to need. It is very difficult to predict how much is going to be required. We need to make predictions, but at the same time if we have underestimated or overestimated we need to respond in kind.
It is morally wrong for any man or woman who is willing to work, who is willing to take a retraining program, not to be accepted into a program immediately. One cannot wait six, nine or twenty-four months. It is not right. It is unfair. It does not resolve the problem. They are demoralized even more. They are made to believe that they cannot fit in. All of a sudden, once they have lost confidence, they could be on an assistance program for the rest of their lives.
The question the member raised is a fundamental one. The only thing I would like to point out is that we may need more models of delivery. That is not chastising the universities or the community colleges, but there is a variety of clientele out there. There are single parents. There are young workers and older workers. There are people who have been in the work force and who no longer have jobs and cannot move out of the community to another job. We need a number of models to respond to the needs of Canadians, particularly right now when we are talking about 1.5 million people on unemployment insurance and almost 2 million on social assistance programs.
To recapitulate, we need to make those funds available. Otherwise we are fooling ourselves. One can

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survive on eating a meal today, but for how long? Of course one does not have to respond fully, but for how long? Yes, we need to respond immediately.


Mr. Don Blenkarn (Mississauga South):: Mr. Speaker, I was wondering if the member and his party will be supporting the bill and the views expressed in it that the minister, when he presents his budget on Tuesday next, cannot present a budget showing a spending in excess of $1.9 billion. Will he be going over that expenditure program with his colleagues to make sure that no more than that much money is spent?


Ron J. Duhamel: Mr. Speaker, I thank my colleague for the question.
He can rest assured that I shall be studying this bill additionally, talking to my colleagues, and voting appropriately when the time comes. I am taking this matter very seriously. I indicated before that I think some people had good intentions with this bill. My concern is: Will it actually do the job?
I also indicated, I had to be fair, that while some of my colleagues on the government side no doubt thought this would do the job, there are others who were smart enough to know that it would not do the job but was going to con a lot of people.
I have not made up my mind yet as to whether or not I should or should not because I have mixed feelings.
I know that some people believe this is important. I also know that it is full of loopholes through which one could drive Mack trucks. That is one question.
The other one is with respect to the budget. My hon. friend can rest assured that I shall be looking at that budget line by line by line. I will even do more than that.
I can guarantee that as well.
I shall continue to look at the budget in relationship to the expenditures that this government undertakes and in relationship to any loopholes it may take advantage of to get around the 3 per cent expenditure guideline. He has my word on that.


Mr. Alex Kindy (Calgary Northeast):: Mr. Speaker, I find it somewhat strange that the former chairman of the Standing Committee on Finance is asking that question.
He knows very well that if the will were there, the government would not need that bill, a bill respecting the control of government expenditures.
We have a parliamentary democracy and the majority carries. In 1984,1 would like to remind the hon. member from Mississauga, the revenues of the government were $70 billion and the expenditures were $109 billion.
By 1989-90 the revenues had risen to $112 billion but the expenditures were $142 billion. There was an increase in taxes collected of over $40 billion. In 1984 the government had the mandate to cut expenditures but there was no will. As I said before it was spending like a drunken sailor.
Now suddenly, because it is the end of the second term, it has decided to fool the electorate. It is telling us that it is going to bring in a bill respecting government expenditures. I think the member from Mississauga knows veiy well that this can be done without legislation.
We are not living in the United States but in Canada where we have a parliamentary democracy.


Ron J. Duhamel: Mr. Speaker, I thank my colleague for his particular points. I would like to remind him that my figures suggest revenue increases by $60 billion, not $40 billion. I think my figures are correct.
My hon. colleague who asked the last question knows perfectly well that where there is a will there is a way.


Mr. Garth Turner (Halton-Peel):: Mr. Speaker, I hope Canadians who are watching and listening to this debate will have listened to the interjections of the last two members and have seen just how this issue of debt and deficit can be viewed in a black and white manner. Some members of this Chamber are accusing the government of having spent its way into massive problems, and other members are chastising the government for attempting to curb its own spending. I hope Canadians recognize very clearly that a lot of rhetoric goes on in this Chamber.
I would like to speak briefly to this bill. I start by reviewing for Canadians very briefly what it is we are debating, what this piece of legislation is intended to do. Essentially this bill will put a limit on federal program spending between fiscal year 1991-92 and fiscal year
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1995-96. I am personally pleased to be able to speak to this bill. I am delighted that it is in this Chamber. I am delighted that the government accepted it and that it is on its way to becoming the law of the land. I say that because I personally lobbied the Minister of Finance in order to try to get legislation of exactly this nature.
As part of the budget of a year ago, this legislation was brought in to provide control on federal spending so that the deficit of the Government of Canada could be reduced and we could start tackling the level of debt that has been built up in this country. To make sure that spending is restrained, the budget proposed this bill which says that by law the Government of Canada has to restrain its spending. I think this is a very significant point. We are removing from my hands as a member of Parliament and the hands of my colleagues in the Chamber the opportunity, the possibility, the power to increase spending in a runaway fashion.
A draft version of the bill has been reviewed by the House. It went to committee where it was tightened up. A few changes were made, I think for the better. What the bill essentially says to Canadians now is: "Listen, you are going to get a guarantee on spending from this government, because the law says that higher taxes cannot be used to finance higher spending and that new programs will have to be funded within the total amount of money the government already has". That is pretty significant.
The budget that came down a year ago was essentially a budget with a guarantee. We have a guarantee in this bill that the government has limits placed on how much it can spend. We know exactly what those are going to be for the next five years. Taxpayers have a guarantee that the government is not going to revert to the bad old days of runaway spending.
Second, in that budget the government created the debt servicing and reduction fund which was a new national bank account. Consider it a national personal savings account.
The third guarantee was that all the extra revenue above what was collected and the taxes it replaced, all those extra GST revenues, were going to be placed into this new national bank account and used solely for the reduction of the federal deficit. It was a budget with a
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guarantee and it was something quite radical. We had not really seen that kind of budget before.
Over the past 20 years we saw the usual dance of finance ministers who came along and gave us a lot of projections and a lot of promises and there was nothing behind them. There was no teeth. There was no legislation. There was nothing forcing them to obtain their goals and targets. Nothing like this bill has come before this House before. It is radical and significant and different.
In order to maintain the integrity of Canada's social programs and to help people in need, there have to be some exemptions from restraint on spending and this bill is no exception to that. There will be exemptions for emergencies such as unexpected flooding. Self-financing programs like unemployment insurance are exempted because they are just that, self-funding.
The real kicker in this particular bill is the provision for overspending. Let's say that members of this House decide to defy the law. Let's say that we vote on legislation which pushes spending over. Let's say we approve a budget that the Minister of Finance brings in that violates the spirit of this. If overspending occurs, what happens then? We owe it to Canadian taxpayers to explore this. If the government spends more than it said it would, what is going to happen?
This bill will put into law that if spending exceeds the limit for any one year, the amount of that overspending has to be made up through spending cuts within two years. It is simple and straightforward, a very direct concept. If the government spends too much in one year and violates the law then in each of the other two years it has to cut. That only makes sense.
In terms of compliance, the finance minister would not be allowed to present a budget that is inconsistent with the act and the annual public accounts would contain a statement saying that they conform to the act.
As a third guarantee we get the Auditor General involved. The Auditor General reports to Parliament on whether or not the act has been complied with.
That is what we are debating. That is exactly what this legislation proposes, and I for one support it but not blindly. I would like to tell the House why I support it. I do not support it just because I am a member of the political party that is forming the government now. It is very close to some of the reasons I wanted to be in this place, why I wanted to be in Parliament. I believe the

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people are saying it is time they had more of an impact on the system. It is time some of the authority and power of politicians to spend their money as taxpayers was removed. It is time there was a constraint, a system, a structure, a mechanism, some form, guarantee, promise, or hope they will have as taxpayers, that the people who go to Ottawa and become members of Parliament do not waste money and overspend. I think the people are saying that. I have had some experience listening to them say that.
I remember a year and a half ago travelling to a small town in southern Ontario called Blenheim. The folks in Blenheim got fed up with property taxes that were going up for one reason or another. It was mostly because of the usual problems we have in this country with too many levels of government, too much overlap and duplication, too many governments trying to do the same thing with one set of taxpayers' pockets and five sets of taxes. We only need to look at two sets of school buses rumbling down the road to see that. We only need to look at the road grader that starts at one county garage and goes down to the town line, and the other country road grader comes up to meet it.
It is only common sense and the people in Blenheim saw that. They saw it there at highway 401 where there were four garages beside each other, one for the province, one for the county, one for the municipality and one for who knows what. They saw all that. They looked at their property tax bills which had gone up 200 per cent in some cases. They said that was enough. They withheld their taxes. It is a pretty radical thing to do. You can do it with property taxes but you cannot with other levels of taxation. People struck back.
I went to Blenheim and spent a day there at the high school auditorium. I met with people to try to find out why they did this. It was pretty radical stuff. What did they propose for other levels of government? What did they think ought to be the solutions? The people were eloquent, articulate and simple in their response. They said there were too many governments and too many sets of taxes. There was too much waste and inefficiency and
the governments were without controls and mechanisms of accountability.
Do you know what? They were right. We do. That is why I can support this kind of legislation which gives us a structure, a ceiling, a roof on the kind of spending we are capable of doing.
That little experience in Blenheim, Ontario has been interesting, and I have been following it for several months. Out of it was created an organization called the Ontario Taxpayers Coalition. The last time I talked to the organizers several tens of thousands of people had joined. The interesting thing about the organization is that it is not composed of the usual kind of protesters we see out on the lawn of Parliament Hill. They are average middle class folks who are a little bit scared of what they are doing and not quite sure what to do next. They do not know much about mobilizing and do not have any organizers. They are generally plain, ordinary Canadian taxpayers who have come together to try to send a message to us, the politicians; the political leaders at the municipal, federal, provincial and regional levels.
Part of the message I think is concerned with this bill. I think they like this. I think the people want it. I think the people are asking for more of that. I have heard the same in my own riding at town hall meetings where people stood up night after night and asked why we don't have a balanced budget; why we don't have some sort of rules somewhere that say the government cannot go into debt; why we don't have something in the Constitution that says you shall have a balanced budget within a certain period of time.
My hon. friend across the way is hollering at me that this does not answer those questions. I will admit that. But what I see here is a very large and powerful step on that path. I really see a government attempt to try to move in that direction.
The questions are in my mail too. I get them when I travel and from the people I visit and talk to at town hall meetings. Let me read you a little bit of my mail. This is from William McGrath of Acton, Ontario: "We must cut programs to control spending. We have become a welfare state. Our children will pay for this folly".
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Arthur Dixon in Cheltenham: "Reduce the deficit. I would pay my own share and that of my family in the shortest time if I believed we could really achieve it".
Harold Denny from Acton, Ontario: "Government should do the same as all private business is doing and tighten its belt until it really hurts. We have to cut our spending to the very bone and eliminate all frills, credit, etc. just to survive the recession. It will be a long, tough struggle. I know, because I started to work in the depression of the thirties, but it can be done".
Kevin Gray in Burlington: "The number one way in which everyone's future will look promising is to get the deficit under control, if not obliterated. It just isn't fair to the upcoming generation. Something eventually has to give".
Stan McNeice of Bolton, Ontario: "Living in the greatest and wealthiest country, Canada, can only be protected if our news media, newspapers, TV and radio people could be educated into the dangers of the debt and be given some happy thoughts instead of all the sad ones". That is an interesting suggestion.
Amel Ranger from Acton, Ontario: "My future, my family's future, and Canada's future are all headed for a big fall. We have all lived beyond our means for too many years. It is now pay-back time. Greed, jealousy and envy have put us where we are today".
Catherine McDonald, Caledon East: "Eliminate some levels of government. Reduce the number of politicians at every level. Reduce the number of grants to "do good" agencies. We don't need to be coddled from the cradle to the grave. Reduce defence, reduce the deficit".
A. L. Campagnolo, Caledon East: "If things continue the way they are going, I see Canada becoming a third world country with all the consequences for my family. Unless the government starts governing the way it should; learning to say 'no'; stops spending the money it does not have; starts repaying the principal on the deficit, we shall not have a future to speak of. We need statesmen, not politicians, and we need them to make tough decisions which people will understand. Free trade may be one of them, but it is not the only one of them, certainly not in its present form".
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Norman Klenman from Ganges, British Columbia: "There is simply no practical alternative. The Prime Minister, the cabinet and the caucus are doing manful work in terrible times. There is simply no money to spend on programs and initiatives which might earn popularity".
J. W. Cargill from Bolton, Ontario: "I will feel happier when Canada starts living within its means. We have nothing for that rainy day and are being forced to borrow more and more against the future. With close to half the national debt owing to foreigners, it's pretty scary".
Finally, from Betty Sherman in Terra Cotta, Ontario: "Until a way can be found to reinculcate such values as self-reliance, responsibility, pride of workmanship and recognition of individual merit in Canadian attitudes, I cannot find much real optimism about turning the country around. Prospects in Ontario under a socialist government are even especially more discouraging. A lessening of government intrusion in our lives might help to restore some incentive, if it is not already too late".
Those are a lot of different voices coming from a lot of different Canadians. They are all taxpayers, and all want the government to spend less and not more.
I might just quickly address the reasons some of my colleagues across the way do not want this bill to be put into place and state their opposition to it. This particular piece of legislation would restrict government spending and hold down the increases in government spending for five long years. Some of the people on the other side of this Chamber believe the government will change at the next election and they will be on this side. I don't pretend to know what is going to happen, but I do know that Canadians will finally have a guarantee that whatever happens to the government; whatever the complexion of this Parliament is after the next election; whatever bunch of people the taxpayers send to Ottawa to run Canada, spend Canada's money and put money in Canada's bank account; will have to live by a law that says they cannot overspend. That is pretty simple. That is what this bill says. We will have a law that says members of Parliament cannot overspend any more. If we had this law over the last 10 years we would not be in the situation we are in now. Whether deficits were run up in

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years past for good reasons or bad, whether the social causes were valid or frivolous does not matter. They were run up, they existed and the deficit got to where it was affecting our debt so much that today we are crippled with $40 billion of interest every year on the debt. If the law had been in place, we would not have the mess today. If this law is put into place, I am sure we will have fewer messes tomorrow and in the years that come.
Those people on the other side do not want the bill because, I gather, they do not want to be constrained and have limits put on the government's ability to spend; a government they feel they might form.
We are in changed times. We are in the 90s now. We are in a time where we face a whole new set of demands, pressures and challenges, quite unlike things that faced Canada before. We all know the world is becoming globalized in terms of trade and world economy. We know there is competition around the globe for capital. They sure need a lot of it in eastern Europe and Russia. They need a lot of it around the world. We need a lot of it. We need $40 billion a year to pay the interest on the debt. Globalization and the search for capital and competitiveness is very concerning. We must get more competitive and we will never become competitive while 30, 35 or 40 cents of every taxpayer's dollar is dissipated in interest payments on the debt.
The 90s demand something different and I think what they demand from a lot of us is what the 1860s demanded of a lot of Americans. I would like to end this with a few words of a man who was very hated within his time. But he was a great man and knew how to read what his country needed then. I think it is what our country needs today. This is what Abraham Lincoln said:
You cannot bring about prosperity by discouraging thrift. You cannot strengthen the weak by weakening the strong. You cannot help little men by tearing down big men. You cannot help the wage earner by tearing down the wage payer. You cannot further brotherhood of man by encouraging class hatred. You cannot help the poor by destroying the rich. You cannot establish sound security on borrowed money. You cannot keep out of trouble by spending more than you earn. You cannot build character and courage by taking away man's initiative and independence and you cannot help men permanently by doing for them what they should, and could do for themselves.


Peter Andrew Stewart Milliken: I would like to ask the hon. member a question. He seems very strong on this bill. I am not sure why because I think if he had listened to my speech, he would have realized the
serious deficiencies in the legislation. He keeps claiming this bill is somehow going to solve Canada's deficit problems. All the letters from his constituents dealt with that, but the bill in fact, as he must recognize, does absolutely nothing to help the deficit since it can be changed at every opportunity.
I looked through the bill and it is quite a short one. I was looking for the enforcement mechanism. The hon. member says this bill will force governments to do this or to do that. Well, almost every bill I have seen has a provision in it that if there is a violation of the bill, if the provision is breached in any way, the offender is then brought before a court and either fined or imprisoned.
I looked in vain for any clause that would put the Minister of Finance in the slammer if he violated this bill. I wonder if the hon. member would be prepared to vote against the bill at second reading to ensure that an amendment was made to it providing that a Minister of Finance who operated in breach of the legislation would in fact suffer some penalty. Perhaps all the members of the cabinet could suffer some penalty, like resigning, because if we had such a provision in this bill when it was passed in 1984, this government would have been out long ago. We would probably have a better government in Canada today. Would he agree to an amendment like that to this bill?


Garth Turner: Of course not. It is not criminal legislation. It is legislation which puts constraints on the spending limits of the government.
The bill, in declaring fairly categorically that if overspending occurred one year spending cuts would have to be made in the following two years to make up for that, is a pretty decent start.


Alex Kindy: I was listening with interest to the hon. member when he was speaking. He was reading all those letters from his constituents telling him that we should cut spending.
The government of this day, the government that was elected in 1984, has spent more than any other government in Canadian history in the shortest period of time. The debt at that point in 1984 was $180 billion and now it is $400 billion.
What is very interesting is that the foreign debt was very low. But now 25 per cent of Canada's debt is owed to foreign banks, to the International Monetary Fund, to
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the World Bank and other bankers. So really our situation has deteriorated.
I am wondering why at the end of its second mandate suddenly the government side sees the light and says that it has to cut spending. It had the opportunity to have better managed the economy. It has not done so and now it brings us a bill that is full of loopholes. This bill does not mean anything.
I would like to ask the member just one question because he talked so much about the need for people to have input.
For instance, Switzerland has binding referendums on any legislation. Would he be in favour that in Canada we establish a binding referendum? If people were not happy they could have a referendum and say to the government that it is overspending or that it should do this or that. Is he in favour of such legislation?


Garth Turner: In terms of the numbers my hon. friend quotes, I would just like to clarify what is the financial situation of the government.
In 1984, the government was spending $16 billion a year more on programs than it was taking in in taxes. That has been reduced through tax increases and financial management to the point where $16 billion in the hole for program spending has now been turned into a $12 billion surplus on program spending. From $16 billion in the hole, spending more than we took in, we now take in $12 billion more than we spend on programs.


Mrs. Marleau:: How do you explain the deficit?


Garth Turner: I will explain the deficit, so listen very carefully to this.
There is a $12 billion surplus this year, yet the interest on the debt is $42 billion. Take $42 billion on the debt interest, remove $12 billion of it because that is our operating surplus this year and we end up with net requirements of $30 billion which is roughly the deficit. We still have a deficit because our surplus is not yet big enough to pay all the interest on the debt.
So Canadians can ask: When is the government's surplus going to be enough to pay all the interest on the debt? That is the real question. When the government has enough surplus to pay the interest, we have no more

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deficit. When is that going to happen? We will find out next Tbesday in the budget.
But the projections at this point are that in fiscal year 1994-95 we have zero deficit because we have got enough in surplus tax revenues to be able to handle all the interest payments on the debt.
It is simple. It is like having a mortgage, not making enough money to make the mortgage payments, and going further into debt. That is the situation Canada has been in for years.
But when there is enough income and finally the mortgage payments can be paid, then you are not going into debt any more. That is where we are leading. That is the most important point and it is amazing how the members opposite lose interest once you start to explain it.


Robert Phillip Kaplan: Mr. Speaker, I have listened to that explanation with a lot of interest.
One thing that the hon. member would have to agree with is that that explanation and that answer is very different from the commitment that they made to the Canadian people in 1984.
They did not say they would reduce program expenditures below taxation. They did not give the kind of complicated explanations that he has just given now to justify patting himself and his Minister of Finance on the back.
They said that they would reduce the deficit. What Canadians understood from that was that the deficit would be lower as a result of electing a Conservative government than it had been before. It is higher.
The question I want to ask the hon. member is this. Suppose the government as the next election approaches comes up with a fancy new idea that will cost a lot of money and thinks will help it get re-elected.
This so-called limit I ask the member, is this not legislation of restraint? Is this not something that can be covered in one simple clause in an amending bill on day care or some other new program the government might decide to do?
Can it not do away with this so-called limitation it is imposing on itself just by having one small paragraph in that new piece of legislation? Like the unemployment insurance bill or the other programs which are exempted, it would say that this new spending program

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would be exempted. Can this bill not be circumvented by the government just as easily as that?


Garth Turner: Mr. Speaker, the short answer is no. Any overspending has to be made up by spending cuts within two years.
In error, I did not respond fully to my colleague across the way to the second part of his question which had to do with binding referenda.
He asked me whether I would support that or not. I have no problem with the concept of referenda. I do not think it would be particularly wise or economical to put every piece of legislation as he suggests to a vote by the Canadian people. Bear in mind the last federal election cost around $100 million.


The Acting Speaker (Mr. DeBlois):: Before resuming debate, it is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised at the time of adjournment are as follows: the hon. member for St. Boniface-Youth Programs; the hon. member for Markham-Whitchurch-Stouffville-Pornography; th e hon. member for Malpeque-Unemployment Insurance; the hon. member for Victoria-Nuclear Vessels; the hon. member for The Battlefords-Meadow Lake-Western Grain Transportation Act.


Mr. Mike Breaugh (Oshawa):: Mr. Speaker, I wanted to participate in the debate on this bill because it brings once again into the forefront of Canadian politics some ideas, some concepts. It is interesting to spend a moment or two looking at their origins.
This particular concept came out of the United States of America. I suppose in these days of free trade and integrating our two societies and integrating the economics of the two societies an inevitable step will be some integration of the political processes and how they go about trying to resolve the problems of the day.
There have been a lot of good things that have come out of California: surf-boards, hula hoops, Frisbees, all kinds of things.
One of the political ideas that has come out of the state of California is an idea called proposition 13. The background is pretty straightforward.
In many American legislatures anybody can walk in off the street and start the legislative process rolling. This can be wonderful democratically. It is not the worst idea in the world, but it has some consequences. We ought to review that a bit.
Anyone can walk in to any state legislature in America and say: "I want to produce a piece of legislation which says stop spending money". It can be as simple and as bald as that. Essentially that is the meaning of proposition 13.
When that is taken out to the population at large, it is pretty attractive. It is like saying: "There will be no bills arriving at your house this week". So they like that.
What they do not like is when the furnace does not work, when their services are not provided, when there is no electricity, when there are no cops on the beat, when their house catches fire and there are no fire-people to come and put out that fire. Then they get a little unhappy.
Those of us in public life sometimes have to explain to people there are many sides to a coin. It is not just a one-way street. There is a reason if the streets are full of potholes. A suitable solution is not to put out barriers which say that the street cannot be used anymore, because sooner or later one might have to. Even those who do not anticipate using that street may have to.
This idea in California produced a lot of bad side-effects. Unfortunately, for those people who were proponents of it, they did not have to stick around and explain the consequences later. That is one of the small flaws in this kind of a proposal.
It had some initial reaction and of course it showed up in the American Congress. It became a bill and the American Congress tried to do much the same thing.
To understand this one must have some sense of how Americans and the American governments put together pieces of legislation. The first thing people should know is that they do not always have to pass a budget for example.
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The President is often upset with Congress, that it will not pass the budget he wants. But at the end of the day if it does not, he will have to spend the money anyway. So Congress often goes through many consecutive years without actually passing a budget and it does not have to pass all the budget bills.
In fact, almost any bill in the American Congress consists of one congressman who wants to say: "Let's all turn left", and another one who says: "Let's all turn right", and another one who says: "Let's go straight ahead", and another one who says: "Let's back up". If it passes the bill, the small little things that we might think are incongruent do not seem to matter. Doing something seems to matter.
That is part of the flaw that is contained in this legislation. If it were, as some members have proposed, a bill which said: "Okay, if the Minister of Finance of Canada spends more money than he is supposed to under a projection which we put in here, we will cut off his head," then perhaps we might be able to say with some surety: "Boy, he sure won't spend any more money than we have allocated in this bill". The bill does not say that. The bill goes, in a very straightforward way, I might add, along one avenue. It explores the legislative side.
What could the Parliament of Canada do in a legislative way to control spending? For some, that is a very attractive proposition, but what people have to understand is that this is not the only way in which governments spend money. This is, if I might categorize it, the theoretical way in which governments initiate new programs, establish laws and then proceed to spend money. But it is certainly not the only way.
Members who have been in this Chamber for a while will be well aware that there are lots of other avenues by which governments spend money and by which they continue to spend.
Part of the problem with this one is by putting a rather simplistic notion in place that you can take a single solitary number put it in law and that that will apply. That is like saying: "The trough is overflowing so we will shut of the tap". Well that may work to some degree, but the trough will still overflow for a while and the trough may not feed those who need it.
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One has to get really simplistic to accept that this kind of a law can be passed.
The Americans in many of their state legislatures or at their Congress have tried this routine for some time. It has not been particularly successful there. I do not believe it stands much of a chance to be successful here for perhaps some slightly different reasons. But underlying it all is this one simple reason: This is not a task that has one solution; this is a task that has many.
I noticed the member for Halton-Peel was talking about the reaction of ordinary citizens to one barn being operated by the municipality and one by the province, and one bus system run by one school system and one by another, almost as if that never happens on the Hill, almost as if there is no duplication here.
Well, to use his same example, let us all adjourn for a moment and go and stand on the front steps. We can watch the little green buses roll around, then we can watch the little grey buses roll around, then we can watch all the little black limousines roll around, then we can watch all the cabbies roll around. Is that duplication?
Do I hear a great outcry in the Chamber today that maybe one bus system would provide transportation to everybody who works on the Hill? Oh, it is missing. Its silence is deafening. Maybe among the population there would be just a touch more of those who would believe this kind of legislation if they had not had their eyes opened for a little while.
That is the wonderfulness about this approach to it all. This makes eminent sense if you have never seen a government operate because you can hold up a piece of paper-here it is-you can say, as the member just did: "Here is the law, and the law says you cannot spend more than this".
By a quantum leap of faith, some would probably say: "You've done it". Deficits in financing have crucified governments for 100 years. Why did somebody else not think of doing it this way? For 100 years we have had deficits, expenditures and problems with financing. Why did nobody in the first century of politics pass a law like this? This would sure solve all the problems.
The reason is it does not. People who have been in government for a while at any level know that it does not, and people who are members of this House know that it will not. Worse yet-here is something I think we

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should note-would be if every single member in this Chamber said: "Boy, this is it. I will stop every bill going through the door that exceeds the limit set in this bill".
Do you know what the end result would be for the people of Canada? Zip. The members in this Chamber, even I dare say the Minister of Finance and I will throw in the whole cabinet, are not the ones who spend the money. Sometimes they delude themselves into thinking that they do, always a dangerous practice. They are not the ones who run the day by day programs.
Even if they want to, even if they think they can, even if they get hard-nosed about it, they are small in number. There are thousands of people in our bureaucracy, in all different levels of government who are intelligent. There are smart people in control of programming who are saying every day: "You can pass any law you want. Give me 24 hours and I will provide you with the first run-through of how to get around that law. Provide me with the law that is the tightest law in the world and we will find a way to get around it".
If they are bright and particularly inventive some morning, they may even think up some new ways to get around the passage of laws like this. Rest assured, they will do it.
If a department head receives his or her status because of the number of people who are employed in the department, do you think that by having the same number of people in that department that you are going to stop expenditures? Even if the growth of that department was zero for a year, would the expenditures stay constant? Not on your life and you know that. That is part of the problem.
Some days I wish there was a law that would be passed which would get at the root of all this but I know better. That is the difficulty with putting this down on paper in quite this way. It is kind of like saying: "All you have to do is pass this bill and the problems are resolved". They are not and people know that. People in this Chamber even, busy folks that they are, know that.
More importantly, people across Canada know that. They have heard this song before. They have seen the dance. They know that governments that came into office pledging debt reduction did not do it. They did not
commit hara-kiri the morning after the first budget was tabled either. They managed to find some reason to struggle on.
This is a government that, in many ways, said it would stop spending money, and in some ways, it has. In other ways, it has not. When it wants to find money to spend, no matter what the laws are, it will find it. We all know that.
To be honest and straightforward, there should be an appendix to this bill which says: "Wait a minute, there is some fine print that goes along with this. There are some ways that governments do spend money and can spend money which will change this mix".
At the very outset, it ought to carry out some of the work that was carried out in the finance committee where it addressed the problem. A change in revenues does kind of change things here. Governments are aware at this time, for example, that although the goods and services tax, that despicable tax, generates a lot of money, it is not going to generate a lot of money if people do not pay it. If there are no transactions, the Government of Canada cannot collect the goods and services tax, which makes it pretty hard to get the money into your hands.
The government is now beginning to address crossborder shopping. It has not begun to address in a substantive way the fact that there is an underground economy growing in this country. It has not really looked at that one yet, but I suspect it will have to because that underground economy is growing more and more each day.
More and more people are seeing that what the Government of Canada is proposing these days is not reasonable. It is not fair. I would propose that that is the test that the government faces. The test is not writing this kind of formula down in a bill and passing the bill. That is not a test at all. It is nice and those are good intentions. It sounds like a workable formula it has going, but people across this country are saying: "That is not what you do. You may say that, but that is not what you do". It does not have very much to do with whether or not there is the generation of economic wealth in this country.
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For example, if the government wants to target a number, 3 per cent, 5 per cent, 10 per cent or whatever, what does one do in the middle of a recession? Does one say: "Well, that is too bad but all of these companies are going to go bankrupt" , all of these individuals are going to suffer hardship and we will not help them because we have passed a law that says we cannot help them.
This week the government is going to be visited by some people from the agricultural industry again. I suspect very strongly that it is going to have to respond to them in some way. If there is a different conclusion to the GATT negotiations than the government anticipates,
I suspect it will have to respond to that.
If the Government of Canada decides it needs to go to war again, I suspect it will respond to that.
The only argument I am making is that this is a wonderfully simplistic, stupid notion. The attraction is that by some magic formula, members can dictate what will occur five years from now. I am arguing that it is not possible and that in a parliamentary system no one has ever pretended that it is. In a parliamentary system unlike a congressional system, the Minister of Finance gives his best guess.
I am an admirer of the congressional system. There are lot of things about it that I would like to see us do here in Canada. For example, I would like to see all of the numbers that are used in the preparation of the budget made available to the general public, not just to one minister of the Crown, so we could all make our judgments.
I noticed that in several legislatures across Canada and here to some extent, we are now beginning to accept that there is not a great deal of need for secrecy for this. Much of this can be on the public record and you do not have to turn to the Canadian public and say: "Trust us. We know you do not know". You could turn to the public record and say: "Here is what we know, compare that with what you know. Then you can compare my judgment as a Minister of Finance against yours as an individual taxpayer". That is reasonable.
I would like to see that information flow come into Canadian politics but it is not going to be accomplished by this bill.

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Earlier on I asked that if there were penalty clauses here, would that suffice? It would answer one argument, the simple argument: Does this bill actually mean anything? Does this bill tell you something that you can take with some assurance? The bill lays out a formula that, to be as fair as I can, could be interpreted as the government's intentions in one avenue of financial matters over the next little while, but only one avenue. It lays out some restrictions that it intends to impose on itself if everything else remains normal.
Unfortunately in this world, everything else does not remain normal and one has to adjust. One did not anticipate a couple of years ago that we would be in a recession or depression such as we are in right now. People were spending money, governments were taking in revenue.
One would argue, and I suppose I would, that that is the time when government's ought to get really preoccupied with debt. When the revenues are really rolling in is a great time to start paying down your debts because you have the money to do it.
When times are hard is the time to put everything on hold for just a little while and think about other priorities, of municipalities and the things we need to do such as investing in the future of our children and of the infrastructure of our nation and trying to build those things. Those would be my priorities at that moment.
They are not mine in a personal sense. If you walk into any municipality in Canada tonight, they will give you a list of things that ought to be done in their municipality. They will tell you that if they are not done they do not have much hope of attracting new industry to their town and it is going to cost them more money in the long run if they do not do it. Therefore, this is not a secret and it is not my personal philosophy of life either. It is just reality.
There are some things I would recommend that the government consider. I notice that more and more people are starting to think about this. The government of Ontario today put the question to its own people, its own civil servants, explaining the the limits we are approaching and asking how we can do things and continue as normal and spend a little less money. We may have to be a little more creative in how we go about that.

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I would think that members who have been here for a while would be the first to admit that there is virtually no incentive for any civil servant at any level of government, anywhere in Canada, to cut costs. Virtually none. That is a sad statement but I believe it to be true. There is no incentive for civil servants at any level to cut costs. They may get a gold star, they may get an award or they may have a free dinner when they receive that award but basically we have not set it up that way. We do not encourage our people to examine the programs in their own work place and we do not encourage those who would know them best on a day to day basis to examine them and begin that process.
In the private sector in many countries in the world they have begun to understand it is pretty important. People in the work place know what is going on. They can help us as executives, as managers, as governments, as corporations to examine what we are doing here. I would recommend that as being something that we ought to do.
I want to read one last section of this bill and I will close. This purports to be a straightforward bill, one which says there is the limit, if you spend over it, you have to take it from somewhere else. It is clause 11:
Inconsistent laws
In the event of any inconsistency between the provisions of this
Act and the provisions of any other law, the provisions of this Act
prevail unless that other law expressly states that it has effect
notwithstanding this Act.
In a nutshell that is what we are dealing with this afternoon. That is why I would not support it.


Donald Alex Blenkarn: I suppose, Mr. Speaker, that all bills try to control spending and keep a lid on it, whether that can be done or not. My friend from the New Democratic Party is quite right, there are huge pressures from the Public Service and in departments to spend, spend, spend. They are there. There are huge problems from people wanting more, more and more from government. They are always there.
It would seem that my friend is saying: "You've got all these problems and you're trying to do this, but it won't work. Therefore, I won't support it because I won't help you to try to stop the spending". If that was the case, if the New Democratic Party feels that since it is tough to control spending, no controls on spending should be contemplated.
Is that the position of the New Democratic Party? Is it the position of the New Democratic Party that a bill which specifically says that on Tuesday next week the Minister of Finance can only present a budget having spending on programs of $100.9 billion, that notwithstanding that the minister can go and spend whatever he wants. Is it his party's position that we should not try to control the Minister of Finance and the government spending?
Is it his party's position to have a government say that by 1995-96, which is four budgets from now, the amount will be $111.25 billion and that it is unrealistic to increase spending because of all of these inflationary costs by $10.35 billion is wrong? Is that the New Democratic Party's view, that you cannot do anything about it, so do not do anything about it. Any effort to do anything about it is bad and therefore any help to control costs is bad so why not spend, spend spend and then eventually something else will happen? Is that the New Democratic Party's view?


Michael James Breaugh: At the risk of getting his blood pressure even higher, let me try to answer some of his questions. What the hon. member said is the traditional Progressive Conservative dance on the matter, that they are so smart and such great managers that they will handle debt like you would not believe. Unfortunately, that is true. It is a directional problem. The people of Canada were somehow misled to think that they would bring the debt in this country down. I think he is right. I do not ever remember them saying they were going to bring it down. They said they were going to handle it. They forgot to tell us they were going to take it up. That is the problem. There is just a little fine print there.
We are smarter in our old age. We are beginning to read not only what they say, but read some of the fine print. Let me try to tackle the hon. member's wild, spurious accusation that we are not cost conscience. Here is a thought for him.
I saw a poll that said most Canadians could not name most of the members in the cabinet. That tells me something. Maybe we do not need them. Nobody knows who they are. The people of Canada are not sure what they are doing. Maybe we could just do away with them. We should try that one on them for size.
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I read the report of the commission on election expenses and reform the other day. That volume, in English and in French, hit my desk, put a dint in the desk. It is a pretty substantial volume. The committee might have been able to get its message out with a little less, shall we say, public relations. It was a very good effort, but that is the style of government these days. I prefer to attack the style and the substance of how governments spend money in Canada.
I have been on this topic for 20 years. It is a tough sell,
I admit it. Everybody in government is pretty comfortable and pretty insulated. I have noticed, though, that at many levels the government is starting to say: "When you wanted to talk cuts in government spending, we would call in all the department heads and they would write us a 20-page memo on how many workers outside ought to get laid off". I am impressed that some people are now saying: "Maybe we should sit down and do our job. Maybe the layoffs should not occur outside. Maybe they should occur inside. Maybe we should take a look at the top dogs and see if we should kick them off the porch for a day or two. Maybe that would be a unique thing".
These are kind of shocking revelations. I do not expect them to take hold right away, but when people talk to me about cuts in government spending, I am willing to talk about cuts in government spending, but all the way up and down the system let us have a long, thorough discussion about this. Do not tell me that you are going to solve the financial problems of Canada by keeping kids out of child care facilities. That is baloney and you know it.
Talk to me about the provision of services on a broad range and if we are going to get the broom out and sweep it and shake it, let us shake them all. That would be a different thing for us to do.


Robert Phillip Kaplan: Mr. Speaker, I want to ask the member for Oshawa to return to a rather flip observation that he made against public servants because as I listened to it I found it kind of hard to take. He said that there was no one in the bureaucracy who had any incentive to reduce expenditures. I do not know how well he knows the bureaucracy, but I know it a little and I know it well enough to know that it is very responsive to the demands of the political system.
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In the last decade there has been great pressure by the Canadian public put on its governments to tiy to control spending. I want to ask the member whether he would concede that a little of that filters through. When I say Public Service decision-makers I am not now talking about someone who supplies stationery at a counter when someone comes up and asks for it. I am talking now those who are entrusted and paid to carry out the will of the government inside the federal government. How can he say with such contempt that they have no incentive to reduce spending?


Michael James Breaugh: I note the word glib. I dislike that word because it is unfair to both the people who work for the Government of Canada and me. You can be unfair to me if you want, that is hardly of any concern to me, but to them it is unfair.
There are a number of people, for example, in the PS 2000 study who tried to make their voices heard. In the end, when they looked at the end result of that, they felt very strongly that they may have been consulted but nobody was prepared to listen. When I say sweeping from top to bottom, I mean that in the traditional sense from the top bureaucrat here on the Hill to the person who is looked at often on the bottom of the process out there. That is the person who may be able to give you the information you need to make the cuts that are sensible. Here is my cry. Why do you not listen to them once in a while? Do not feed them any more platitudes. Do not have any more conferences. Do not tell them what wonderful people they are. Forget the blue ribbons. Shut up and listen to what people across Canada, at all levels, have to say. That is a crime of which I myself am guilty because you have to learn that lesson first before you can hear their message.


James Capsey (Jim) Karpoff: One of the things I would like to ask the member about is his understanding of the problem that this government has put itself in. Here it is passing legislation that is reportedly binding a future government on expenditures when last year it went to the Supreme Court and had it rule that no government can bind future governments on expenditures
That was on the Canada Assistance Plan in which there was a specific law that spelled out expenditures. It was this government that went all the way to the Supreme Court challenging that law. The Supreme Court ruled that one government cannot bind, in fiscal

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matters, a following government. How do you explain this whole bill which is based on this very premise that we are going to bind a government?


Michael James Breaugh: I think this bill might have had a chance of being accepted by the public at large if it had never heard of you or seen you or had any track record by which to judge the performance of this government. You might have been successful in convincing the public that you found the new wonder bread here that will feed the nation and solve all the problems. The problem is that the public has seen your act before. It has heard every song you have to sing. It knows that you have gone as far as the Supreme Court of Canada to retain the right to spend money as you see fit.
The public has seen you exercise billions of dollars in expenditures by means of Order in Council. It has seen every scheme that mankind has concocted during the course of this century for spending money pulled off by this government. To have you walk in with a bill like this in hand and try to plead that you are bom again is just too much for all of us.


Robert Phillip Kaplan: Mr. Speaker, after disagreeing with the member for Oshawa about his attack on the Public Service, I think I would like to begin by agreeing very much with the tenor of the remarks that he just made. As he was speaking I was thinking of the old American saying, which I know must also apply in Canada, that you can fool all of the people some of the time, and some of the people all of the time, but you cannot fool all the people all of the time.
It is not the goal of this government to fool all of the people all of the time. The question is, as the member for Oshawa suggested, can it fool enough of the people enough of the time to be re-elected with the kind of performance it has had on the promise it made about deficit control? That has been a big issue in this debate and it underlies the significance of this bill. I was a member of the government and I remember very well the precise promise that it made. It is easy to remember because it was so simple. It said it was going to bring down the deficit.
Now, when questions are raised in the House about whether it has managed to bring the deficit down, it is amazing how long it takes to answer that question: "We are bringing the deficit down but it is not exactly the
deficit. We are not exactly reducing the cost of government but we are sort of reducing the cost of some programs of government. We are reducing the cost of our programs but we are not reducing the cost of the Liberal programs".
Although the deficit is going up, it is really going down if you look at it through the tortuous path that this government is using, the perspective it is offering the Canadian people, to try and get out of admitting failure on the promise it made in 1984 to reduce the deficit.
Some of the government members were serious when they made the promise. They came into office determined to reduce the deficit and they did not. Concerning the large deficit which they took over in 1984, which seemed to be large by historical standards of the time, they were busy reminding Canadians that we had increased the deficit more than ever since Confederation and we had been in office for 17 years or so. They proceeded in a short period of time to see that deficit doubled. They cannot go to the Canadian people again and say they are going to reduce the deficit again. They know a promise that they would make now would not be believed because of their abject failure to keep the promise they made in 1984.
If the government could not keep the promise that it made in 1984, not even some of the people, let alone enough of the people, would believe that in the next election it is going to be able to reduce the deficit.
I would like to say thanks to the policies of the Liberal finance ministers which had put us temporarily through some times which looked tough then, but which in perspective with the disastrous economic performance of this government are starting to look pretty good; even those years which we were not so proud of between 1980 and 1982. The government inherited an economy which began to boom. It presided over boom times.
I just heard the member, who is a former financial writer for The Toronto Sun, saying that it was going to take years of economic successes for the government to be able to reduce the deficit. Let us be realistic about it, he said. If this government is capable of reducing the deficit during boom times why did it not do it? Why did it have to pull out a slide rule and so much fine print to convince Canadians of the fact that it reduced the deficit
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since it took office in 1984? The government did not reduce it. It saw the deficit more than double in a much shorter period than the period of deficit increases under the Liberals.
In many of the years when we were increasing the deficit it was the right financial posture to be taking. I am not saying it was right every year, but I will say that the Conservatives inherited some good times. Even during the course of the election the indices of good times started to appear. If they were really going to reduce the deficit, if the Canadian people who took them at face value were going to be honoured by the performance of the Conservatives, they would have done what they said they were going to do. They could have reduced the deficit and they did not.
This time they will not fool all the people. They might fool some of the people, but they have to ask whether enough people are going to be fooled by this bill into believing that we do not just have to rely on this government and its record of failure and disaster to reduce the deficit; we are going to have this fancy piece of legislation that is going to do the job for us.
If you do not believe in the government, which most Canadians do not, at least believe in Parliament which has enacted a piece of legislation, the Conservatives will tell on the hustings in the next election, that will tie the hands of the Minister of Finance, who was not bound by the promises that the government made during the election, who did not perform, who did not reduce the deficit, but who now will be constrained by this major piece of legislation to keeping the deficit down.
That is the spirit in which this legislation has to be examined. Is this legislation going to force the government to honour a commitment to reduce the deficit? This piece of legislation is an insult to the Canadian people and it is an insult to Parliament. What the government is saying is that this piece of legislation is worth taking the time that it is asking the elected representatives to take to study it and to celebrate it because it is going to do the job that the Minister of Finance could not do when he had boom times and when he brought in deficit budget after deficit budget, more than doubling the national debt. Now, because we cannot trust him, here is a piece of legislation that will have the stamp of Parliament on it which we can trust.
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This piece of legislation comes from an honourable tradition, a tradition which has no relevance at all to the Canadian budgetary process. It comes from the United States in which the president brings forward or proposes a budget. There are cabinet secretaries who are responsible for fighting for the budget.
However, the system in the United States is different from ours. The budget cannot just go through because the administration wants it. In our system, the administration would have to resign if its budget did not go through. In the United States system, the administration knows that its budget will not go through. It knows that it is going to have to change the budget a lot, that the power in the legislative wing of the American congressional government system is going to be heard and that programs will emerge from the legislature, budgetary programs of a sort that cannot even be introduced by members of the opposition in this country. We cannot bring forward a money bill here unless we get the government to approve of it.
In the United States where this idea comes from, anyone can introduce a money bill and the budget that results is a matter of a compromise. As I mentioned a moment ago, our system is so different that the suggestion that this bill somehow or other constrains a Minister of Finance or constrains the budgetary process really is an insult. I would hope in political science classes and government classes across the country this bill is going to be picked out as a demonstration project of how a government can try to fool enough of the people enough of the time to get re-elected.
In our system it is as easy for the Minister of Finance to change this bill after it is enacted as it is for him to violate it, if he chooses to do so. The same minister who brings forward the budget brought forward this bill. It is a bill that stands in the name of the Minister of Finance. If it suits the Minister of Finance to live with this bill, he can live with it. If he prefers changing it, he does not have to negotiate that with the opposition. In taking his budget through Parliament he does not have to obtain our approval. He does not have to compromise with the undoubted power in the Congress to bring forward money bills of equal weight, of equal authority, and sometimes more than the authority of the administration of the day in the United States. The Conservatives are hoping that when people see this bill they will remember what happened in the United States where bills like this really do constrain a government and that they will think the same situation applies in our country. That is the story of this bill.

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We sent a delegation from this Chamber to the United States to pick up ideas. I am in favour of that. It is very useful for us to see what is happening in one of the world's great democracies, in the congress of a superpower. They looked at this very type of restraint and I want to quote what they had to say about it.
The Conservative members of the committee who went there recognized themselves that however valuable this type of bill is in the American system, it is meaningless in the Canadian system. It is without meaning, without the possibility of altering a determined Minister of Finance who wants to have whatever budget he brings forward approved, in whatever form he brings it forward.
By the way, if he is unsuccessful in getting that budget through he has to resign. That does not happen in the United States. In the United States if they do not get their budget through they change it. However, in our system the Minister of Finance must have control of the House for his budget, or we get a new government.
This is what a parliamentary delegation said, supported by Conservative, Liberal and NDP members, when it studied this type of American constraint on the budgetary process. I would like to quote them. They said: "Budget control legislation is a distinctly American approach to problems arising in a quite unique legislative environment. Just because the American system might need such controls does not imply that the Canadian parliamentary system would necessary benefit from the same approach despite the fact that both countries face similar fiscal problems".
They face similar fiscal problems but the responsibility for our deficits is the sole responsibility of the government of the day, not of the Parliament. It is the sole responsibility of the Minister of Finance of the Conservative government that it has failed to keep its promise to reduce the deficit that was there in 1984. It might have some explanation for what it did, which might have been terrific. The Conservatives think it was terrific, but it certainly was not a fulfilment of their promise to make
the deficit less than when they found it; they made the deficit double what they found it.
The result of the economic performance of the government on the question of the deficit it will take to the Canadian people in the next election will be its deficit. It will not be the deficit of this Chamber. It will not be measures forced on it by the opposition in order to gain approval for its budget or for its programs. It cannot say any of that. It must take, in an accountable parliamentary system of government with a majority government, full responsibility for its economic performance. Every dollar of the deficit is one that is there only because it did or failed to do the measures that would have made it otherwise.
The Conservatives knew that back in 1982-83. They knew when they made the promise to reduce the deficit that people could accept it. The people knew that if they formed a majority government they would be able to have whatever deficit they decided to have. They blamed the Liberal government that preceded them for having the deficit that it had. We did not go around blaming the opposition for the deficit. We went around defending what we were spending the money on.
I have to remind people of something that is often forgotten, that is that many free, democratic countries like ours were also overspending in those years and were also putting off the worry about dealing with the deficit. I am not saying that dealing with the deficit was a top priority of ours. It was not. Delivering programs was a top priority of ours. We took account of the deficit but it was not our top priority.
However, it was the top priority of the Mulroney campaign team that made a promise to the Canadian people in 1984. We did not make it our top priority, but I am sure you may recall, Mr. Speaker, that they made it theirs. If they could not reduce the deficit in 1984, 1985, 1986, 1987, 1988 and 1989 when we had terrific economic performances in this country, they know that people will not believe it when they say they will will do it in the next mandate.
This fraudulent piece of legislation is brought forward to create the impression that somehow or other, if we do
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not believe the Minister of Finance it does not matter because he is stuck with this legislation.
As I indicated in the question I asked of the member from Mississauga, it is as easy to deal with this restraint as it is to bring in a new expensive spending program. All they have to do in their 11-clause bill or their 300-clause bill or whatever is stick in one little clause saying that this new expenditure program which may be a fully justifiable program-I am not saying it will not be; I would like to see it before condemning it-gets the same treatment as the unemployment insurance program, namely it is outside the restraints which would otherwise apply.
This bill is no restraint at all on the government of the day. It is an attempt to make Canadian people, who I expect know better, believe that our system is more like the American system than it really is and that somehow or other the opposition or Parliament plays a role in determining what the contents of the budget are when we do not. We are bound if the budget does not go through to have an election on it.
I would urge the government, rather than trying to pull the wool over the eyes of my constituents one more time, to do some things that would really reduce the deficit.


Mr. Pat Sobeski (Cambridge):: Mr. Speaker, as one of the members of the finance committee that journeyed to Washington, I would like to pass some information on to the member for York Centre.
The member is suggesting that when Gramm-Rudman was first introduced in 1986 there were never any changes to it. In actual fact the finance committee learned that it had been changed three times because the fights among the president, the congress and the senate did not cause a smooth flow as the member would suggest.
When the bill came out in 1986 Gramm-Rudman suggested that the American deficit in 1992-1993 would be zero. They readjusted the targets two years later. In this fiscal year they are looking at a deficit of some $400 billion and getting worse because they have almost a $750 million loss in their savings and loans that they still have not figured out how they are going to pay for.
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There were some problems with it. Gramm-Rudman allowed the politicians to adjust for inflation. If inflation went up 6 per cent their spending targets went up 6 per cent. That does not exist in the Canadian legislation.
The politicians made what I would say were conservative estimates on spending. When it came to projecting revenues they took a very liberal attitude and projected very high revenues. That made the deficit look smaller and at the end of the year when they tried to meet two moving targets it did not work. The minister here is trying to put it on the control side.
The Americans said: "You have a parliamentary system. You have one system. Maybe you do not need this type of legislation". Later on the report did say that this was probably good because it would focus on it. If indeed the Minister of Finance decides that he wants to change the targets, he has to come before Parliament and confess his sins as to why he might not meet these targets and where he is going to go. That would allow the opposition and all Canadians to understand.
It is quite clear that the government is not only setting targets but wants to establish targets. I do not know why the hon. member would be opposed to that.


Robert Phillip Kaplan: Mr. Speaker, it is quite true that the Minister of Finance will have to appear before Parliament to amend this legislation if he wishes to present a budget that exceeds the spending limits in this bill or in any other legislation, but in any case, there is no such thing as a Minister of Finance who presents a budget and does not have the support of the majority of Parliament. It is not a matter of convincing the House but a simply a matter for the minister to decide. There is a difference.
I just read a book published in the United States, called Assembly of Whores, which describes the concessions and negotiations that are necessary in the United States for the administration to get its budget through Congress. Here, things are quite different. The government does not need us at all. In the past, the opposition's only right was the right to delay. During this Parliament, however, we even lost that right. We have no power except that of plying someone with questions for a certain time, condemning or criticizing, but everything is

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still up to the government. In our system, every cent of our deficit, every single cent is the responsibility of the government. Not in the United States.


Donald Alex Blenkarn: I am literally amazed that my friend would come to the House and say that the opposition cannot do anything about criticizing the government. It just does its own thing. Opposition members can go and talk on the street and make speeches, but really, they cannot change anything. The Minister of Finance has total control of everything.
You would almost wonder why they are here. The members have to realize here is a bill that specifically sets out that this Minister of Finance is going to produce a budget on Tuesday that will involve no more than $100.9 billion worth of expenditure on programs.
He does more than that. You have all sorts of targets. You can talk to the A-G. You can go after him day after day about the fact that he cannot run a country. He cannot be a minister. He cannot keep his promises. He cannot do this, that and the other. At least you have him pinned down.
Why would you not cheer this bill forward? I can criticize the bill. I am going to speak a moment or two, perhaps, if the Speaker recognizes me but surely the problem with the bill is that you hook the minister on the hook. Why would you not cheer that minister who decides to hang himself on his own petard here? Why would you not say this is wonderful? Now, we will get him.


Robert Phillip Kaplan: Mr. Speaker, I am glad the hon. member asked the question. He asked why we want to be elected if we don't believe we can change the government's policy. I can inform the hon. member that we are not here to change the government's plans or to force it to change them. We do not have that power. We are here to provide the Canadians with an alternative. If the hon. member wants to give us a chance to show what that alternative is like, I would advise him to ask his colleagues to call an election, because that is what we are
waiting for. We are not waiting for the government to do what we want it to do. We are waiting to have a chance to get rid of them.


The Acting Speaker (Mr. DeBlois):: Another question or comment? Resuming debate.


Donald Alex Blenkarn: I always felt it was the duty of all of us in Parliament to make productive comments and suggestions as to how we, representing our constituents, could help make Canada work better.
The member for York Centre has suggested that you really can only do that in an election. You never make a concrete proposal or a policy or a way of handling things except in an election. You are just here to sort of collect your pay and criticize and harp, but never to make a policy suggestion. That is just unacceptable to me.
I would suggest that it should be unacceptable to all members and certainly to the public. Here we have a very senior member of Her Majesty's Loyal Opposition saying that there is nothing the opposition can do. There is nothing the opposition would put forward and there is no policy the opposition would have. Call an election and we will tell you what we are going to do. Huh.
This is an unacceptable attitude. It means that we have half of Parliament, the entire opposition, taking the position that it is really not here to make things better for Canadians. It is merely here to politic, get power and that is all that really matters.
Surely to goodness we are elected to try to bend, alter, change, develop and improve the lot of our electorate. We are not here just to make political gains. Let me deal with this particular piece of legislation. I am critical of this legislation because it tends to tie the government's hands and it can do very serious damage to any Minister of Finance.
The bill limits with a whole series of clauses the government's total spending on programs from 1991-92 through to 1995-96, a total of five years. Essentially the bill goes back to the last budget. In the next four years this government has to keep its spending down in increases on programs to less than $10.35 billion. That is a pretty serious limitation on the increase in program costs.
I suppose if the government is capable of keeping within its inflation targets, if things do not get out of



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hand, it might be able to do that. But should inflation increase, the government is still stuck with that legislative limit on its spending. It is all very well to say the government could come forward with a bill and change that limit. Yes, it could. No government can bind another government and governments in this Parliament can always change laws. But think of the embarrassment, think of the problem, coming here as a government and saying that this is all you can spend and then saying at another time: "I'm sorry we couldn't keep within our targets. We could not manage as we said we could manage". What a terrible abject story of defeat.
Yet we have the opposition which does not want to see any controls on spending because they wants to spend, spend, spend. They never want to control spending. They want to spend. Therefore, they are opposed to this bill because it tries to limit spending.
They are very worried because they believe they might take over and then they would have to come to this Parliament and change the spending limits. They were not able to keep in track and keep spending in track.
Isn't that too bad. Let us find out when they vote on this bill how they vote. Are they prepared to limit spending? Are they prepared to say that all governments should spend? Are they prepared to say: "If you want to spend more on one program, then you will have to take the money out of another program?" Or are they prepared to carry on with their usual attitude: "We'll spend and we'll advocate more spending".
Day after day goes by. They stand up in Question Period and want this program or that program or this new add-on or benefit and they never control themselves. They do not want to see anybody control them. They want to be able without the criticism of the Auditor General to go ahead and spend without limit.
Sure there are some faults in the bill. Sure there are some exemptions in terms of an emergency where you could break the bill, but you would have to explain the emergency. In terms of farm relief you could break the bill, but you would have to show that was the cause. The fact is that the spending is set out in the blue book, hopefully filed next week by the President of the Treasury Board when he tables the estimates. The spending set out by the Minister of Finance in his budget for
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program expenditure will be $100.9 billion and no more. In fact, it will have to be less than that.
It cannot be more and you cannot ever organize yourself to spend every last penny of your limited amount of budget to be audited by the Auditor General.
Has our Minister of Finance ever put the handcuffs on himself. But surprisingly the spenders do not want any handcuffs at all. They do not want any control on spending.
They talk about deficits. They say that this terrible government took over and the deficit was $180 billion or whatever. Now it is nearly $400 billion. They know, we know, the country knows that not one penny of that national debt increase from $180 billion to $400 billion is caused by program expenditure. It is caused by compound interest built up by a debt created by Liberal governments that had no limit on its appetite. When we took over their deficit was to be $37.5 billion and turned out to be well over $40 billion. We managed to crank it down to $37 billion.
Yes, the economy was booming but you were spending $16 billion more a year on programs than we took in in taxes, in programs. You had to borrow all this money, $30 million or $31 billion, and on top of that you had to borrow more money just to pay the programs.


An hon. member:: Why didn't you stop the borrowing in 1985?


Donald Alex Blenkarn: We did and if you had been here you would have seen that. You would have seen year after year program chops. What did we get? We got the crying, the weeping, the wailing, the gnashing of teeth of members of the Official Opposition saying, oh, you do not spend enough money.
Last week when speaking on the transfer program with respect to the CAP, my friend from Broadview-Greenwood-he is the spender. He is another spender. He is the guy who said that a 5 per cent increase in welfare and Canada Assistance Plan is not good enough, you have to have more, you have to have more. The inflation rate is down to 2 per cent but he thinks the 5 per cent increase is not good enough. Two and a half times inflation is not good enough for the member from Broadview-Greenwood. He wants to spend more and more. There is the kind of spender that you get in the Liberal Party. He

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does not want controls on spending, he wants the right to spend, spend, spend, spend and no controls.


Dennis Joseph Mills: I want to spend on retraining.


Donald Alex Blenkarn: There we are, we have now got the admission. Mr. Speaker, we now have the admission. He wants to spend but he does not say where he is going to get the money to spend. You know where he is going to get the money to spend? He will tax more or borrow more. Awful easy to borrow, not very good to tax. He wants to borrow more so really when it gets down to it these people have no desire to cut back on their appetites. They want to put this country in the hands of the IMF.
Let us not cry about deficits because you will never control deficits until you control spending. The minister has produced a bill and I can tell you I found a lot of imperfections in it. I think it should go to committee and perhaps be tightened up a bit.
Can you imagine an Official Opposition complaining about deficits but not prepared to do anything about spending even when the minister puts it in a bill? The minister says: "I will only spend $100.9 billion next year on programs and I am limited to that. If I spend more you have got me". Members opposite say: "We do not want to get you, Mr. Minister, we want you to spend more because every day in Question Period we are going to ask you to spend more. Every bill that comes along to cut spending we are going to want you to spend more. Oh, we do not want to say your hands are tied".
Yes, sir, we need a lean, mean machine in this country to make this country grow. We need to build a country and get rid of our debts and make sure we are competitive. We cannot stand any more Broadview-Greenwood giveaways.


Dennis Joseph Mills: Mr. Speaker, there is absolutely no way I could let my friend from Mississauga South get away with that. There is one thing that we say on this side of the House about the member from Mississauga South and it is that during the last election campaign, he had the courage to stand up and tell the people of Canada that the GST or the value added tax, as we were calling it at that time, was going to be a $10 billion gouge from Canadian taxpayers, when
the then minister of finance from Etobicoke said that this GST was going to be revenue neutral.
I enjoy engaging in debate with the member from Mississauga South because he is on the mark many times. He was on the mark with his idea of capping interest rates on credit cards in his private member's bill which I supported in this House, but his government colleagues would not get behind him when everybody in the country was supporting him.
The problem with this bill is the fact that it is filled with loopholes. It is filled with opportunity for the government because if a reason for additional funding requirement comes along, it can always be referred to the emergency clause in this bill.
With all the best intentions of the member for Mississauga South, there is no way that the people of Canada are going to believe that this bill is anything other than smoke and mirrors and a diversion from the fact that the debt in this nation has doubled in the last few years and in spite of it doubling, we still have an economy where the people are in deep pain. We talk about retraining here, yet one cannot get retrained. We talk about hope. We are looking for it.
My question to the member is this. Does he not think that it is a bit cynical to say that we on this side of the House are not concerned about the deficit and debt, that we are just spenders when it was his government in the last five years that had 32 tax increases including the GST which he himself did not support during the last election.


Donald Alex Blenkarn: I do not want to disabuse of my friend. I spoke in favour of the goods and service tax or the value added tax in the election. I spoke in favour of it before the election and I want to tell him and his colleagues in the Liberal Party, on two occasions, unanimously in the House of Commons and in the finance committee endorsed that tax.
I have just been handed the financial results of the country for the first eight months of this year. If you want to take a look at spending, you will find that program spending as of the end of the first eight months was $71.24 billion. This bill means that for a 12-month period, the government will only be able to spend $97.2 billion. If you really want to put the feet of the Minister of Finance to the fire, you might find that the minister
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has only the right to spend about $28 billion in the next four months of this year ending March 31.
I suspect that the minister is going to have a very hard time complying with this bill. If the opposition had any intelligence at all-hard to find any over there sometimes- they would be voting wholeheartedly for this bill. They would want this bill in place and in force before the end of the fiscal year because immediately thereafter, they would be getting the financial figures from the Department of Finance and they could go after the Minister of Finance daily about his inability to manage. You and the opposition are afraid of spending control bills. This opposition is not bright enough to have any new ideas or any new ways of going at things or even new ways to be opposition. They are not even good at being opposition.


Joseph R. (Joe) Comuzzi: Mr. Speaker, I hesitate getting into an argument between my colleague from Broadview-Greenwood and my friend from Mississauga South.
Given the statements that we heard from the member for Mississauga South, I would advise him there is a reality in Canada that exists beyond that 50 square miles of what we know as the hub of Canada or the Toronto area. There are some people who have some reality outside of the city of Toronto.
What people outside the city of Toronto want to hear is the realities of where this country is going today. They are not concerned as to what we have heard in the last few moments about who did what in 1978, who did what in 1984 or what has been happening back and forth. They want to hear where this country is going to go from this time forward, regardless of the deficit and regardless of the debt, which is $400 billion. I spoke yesterday in this House about the immense problem of paying the interest on this debt, 37 cents out of every taxpayers' dollar that buys absolutely nothing for any citizen of Canada.
With that in mind, I would like to ask the member for Mississauga South: What about the rest of Canada? What do the people in the smaller communities in this country such as Winnipeg, Edmonton, Calgary, Thunder Bay, and on the eastern seaboard that we heard so much today about the fish industry and the distress that we find there? What does this bill do for the hope, the desire and
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the feelings that we, as Canadians, can look to from this government and future governments with respect to where this country is going?


Donald Alex Blenkarn: Mr. Speaker, I think the member from Thunder Bay made a very important point. When we are spending 37 cents or 36 cents of every dollar we take in tax on interest, we have precious little money available for day care, senior citizens, training and all of the things that we would like to have. That seriously impairs the ability of this government and provincial governments to some extent that depend on our transfers and municipal governments that depend on transfers from their province to perform those things that Canadians want.
The most serious thing that we can do, and this House has that challenge, is to get our financial house in order, get our debts down and stop spending the money we are spending so that we will not have to borrow, so we will not have to pay that huge portion of the revenues of the country to the bond holders.
This is a bill designed to tiy to do that. It is not a perfect bill. It is a bill trying to force government to come to reality in terms of its spending. When we in this House vote money, we in effect authorize the spending of money. What we have to do is say: "Well, you can only tax so much. The only other way to get at your problem is eliminate or cut back on your spending".
I do not think we are very good at that. I think we make a mistake in committees of the House when we have the estimates before us in not cross-examining and cutting back on some of those estimates. I think we ought to be passing resolutions and cutting back estimates all the time. We have an obligation to do that. Surely we have an obligation to put some over-all controls on where we spend money. This is an attempt to do that and I would ask the opposition to support that attempt.


Diane Marleau: Mr. Speaker, I have sat here for the last little while listening to some of the comments of my colleagues, especially my colleagues from across the way. I always have to remind them and anyone else who needs reminding that we do live in a parliamentary democracy.
Parliamentary democracy says that if a government wins the majority of votes that it is in control, that it can

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vote whatever amounts of money it needs. It can pass pretty well whatever laws it wishes. It need not listen to opposition if it does not want to and more often than not it does not. Therefore, it is in control. From the day it is elected, it is in control.
This bill says to me that this Conservative government is admitting to the people of Canada that it has failed. It has been totally incapable of controlling its own spending. Imagine. This is the government in power. It has its own finance minister, its own cabinet, its own meetings and all of the finance officials work for it. It is saying to the Canadian public: "We cannot control our program spending. We cannot do it. We have to pass a law". That must be the reason why it would bring forward a bill such as this. What other reason could there be?
There might be another reason. There just might be. I think it is another very valid reason. The government has realized that it is going to lose the next election. It is over folks. Too bad, it is gone. Therefore, it has decided that it will try and leave a legacy of conservatism, somewhere, somehow, by passing a bill trying to control what is going to happen next time around.
It may be a good idea, but I do not happen to agree with it. I happen to believe that the only way to control spending is by the will of the people, the will of the people who are elected and the will of the people who form the government.
If you have to pass laws which have absolutely no teeth, if your minister comes in on Tuesday with a budget that is over the limit that has been set here-this is not a bill yet-the answer will be: "Well, it is not an act of Parliament yet, so we really do not have to follow it". What measure is there to make the minister and the government follow this particular plan? There is none. Who is going to send the Minister of Finance or the cabinet to jail? What is going to happen? Can you do it? Can this bill do it? No, it cannot. So why bother, except to fool people.
This is the same group of people who got elected in 1984 by saying: "We are going to battle the deficit". In 1984 they said: "Imagine, if we continue spending the way the Liberals have been spending, by the year 1992 there will be a debt of over $400 billion". They said that in 1984. Imagine that. They have been in since 1984 and
do you know where the debt is now? Over $400 billion. What happened to all these plans? They always have these fantastic projections and these great plans, but they cannot seem to follow through on any of them.
Let us stop playing games. This is another attempt at game-playing, at trying to pretend that: "Hey, we have now seen the light. Hallelujah".
When you look at this piece of legislation it says very clearly: "The minister may in a budget for a particular controlled fiscal year propose program spending for the particular year that exceeds the spending limit for that particular year". He can do that if he wants.
There is another one here that says: "The minister may present a budget for a control fiscal year that proposes program spending for any particular control fiscal year that exceeds the spending limit for that particular year". It goes on to say under what conditions and all the rest of it.
What no one has explained to me is why we pick 3.8 per cent. In the draft legislation that had been before the finance committee somebody had proposed 3 per cent. I guess it just sounded like a nice neat amount. Now it is 3.8 per cent. Why should it be 3.8 per cent? Why should it not be 0 per cent? Why should it not be a decrease? Why should it not be 2 per cent? You have limited the Public Service to no increase, but you are saying that now the magic number is 3.8 per cent. Let me see. The proposed limits would allow program spending increases of 3.8 per cent in the fiscal year ending March 31, 1993,
3.2	per cent in fiscal year 1994, 3.2 per cent in fiscal year 1995,; and 3.6 per cent in fiscal year 1996. It then goes on to give the actual dollar amount.
What kind of divine intervention has come into their minds to tell them that this is the number?. This is it. After all, the interventions that they have had in the past have not come through. They certainly have not followed what was in their proposals. We have heard for many years about how they were going to tackle the deficit, and it was going to be gone. We are still way over $30 billion in terms of the deficit.
I ask you again: Why that particular rate? Why not a lower rate? The worst thing with setting a limit is it becomes the number you aim for. I do not happen to believe that we should aim for this number. I think we
February 18, 1992

have to do the best that we can with the moneys we have, and hopefully there could be no increases if necessary. If it were possible, would it not be a lot better than 3.8?
I ask the question. I do not happen to be one of the lucky ones who sits on that side of the House and has the moral authority to set the amount at whatever for whatever reason.
We have to remember one other thing. If you can recall, I say one of the reasons for bringing this bill forward is that this government realizes that it is finished, it is going to lose the next election, it is over, too bad. We are now into the last year of this government's mandate.


An hon. member:: We hope.


Diane Marleau: Well, we know. Even it is admitting it with this bill. It is over and done with.
One of the things that is happening is that this bill would allow the government in a budget to propose spending that would exceed the limit for a particular year and then to say how in the next two years it is going to make it up. You tell me how a government which is not going to be here after the next election can propose this. On Tbesday the Minister of Finance can come in with all kinds of neat ideas and then afterward they can say: "Oh, oh, blame the party that came in and took over from us. It did not follow. We said it should spend this much less because we overspent this year". It does not make a lot of sense to me.
I am wondering, why now? If the government is that interested, why did it not bring in this kind of a bill in 1988, or in 1985? That was the time to start really paying down the deficit. It tried, but not very hard, I must say. It was not the biggest effort on the part of anyone. What I am saying is that the Conservative government lacks any kind of direction. It has a bottom line mentality-bottom line, bottom line, bottom line.
I have news for this Conservative government. We are not a business. We look after the interests of Canadians. Yes, it is good to have sound fiscal management, it is very good. But you must not forget that you are dealing with the lives of people. You may complain about what Liberal governments did in the past, but if you get right down to it, if it were possible to work the economic
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theories, in bad times governments spend and in good times governments create surpluses to pay back the times that were bad. If anyone had bothered to follow that principle from 1984-85 on, we should have no deficit at this time.
Oh, but no, we were a lot more interested in having a gay old time. We increased taxes in some of the most prosperous years that this country has ever known. We increased them in 1985, 1986 and 1987. What kind of fiscal policies did we bring in? Did we really try to battle the deficit?
We said we would, and it did come down somewhat but not enough. It did not come down enough when you consider the growth of the economy and the kind of prosperity that we had at that time.
Now when we are at a time of depression again, there are no moneys to help people. Now there are only spending restraints. Whose fault is it? You are very ready to blame past governments and I am now very ready to start blaming you for your mismanagement.
Perhaps if you had managed a little bit more wisely, we would not be in this position we are today. The idea behind all of this nonsense is to try to hoodwink Canadians into thinking that you are finally going to do something, like they do in the States.
Well, Gramm-Rudman in the States did not work. There are always ways around and it is still not working in the States. I like to think of the States as a tax increase waiting to happen. It has not faced its deficit problems. The laws that were passed and the amendments did not prevent it from running up huge deficits.
There are always emergencies. There are always wars or high unemployment. There is always something, so you have to look at everything. You cannot just set yourself some kind of a target. If you want to do that when you form the next government, if you ever do again, go right ahead.
There are many other things that are very loose about this bill and some of it is the tax expenditure loopholes. Obviously, there are times when the economy needs stimulating, and you can use a tax loophole. A tax discount can be given if you promise to invest in certain shares of certain companies. I can do all kinds of things. This does not stop that.

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This does not say whether it is the right way or the wrong way. This just looks at $100 billion in year 1993. What happens if we expand the economy? Why $100 billion? Why not $80 billion that year?
I am just curious about who is the guru who came up with the magic figures and is trying to write a budget for the next five years. I have no idea who is the guru, and I am not particularly impressed with him by the way.
You talk about there being nobody on this side of the House who is fiscally responsible. I have news for you. Many of us are.
I was once a member of a municipal council, a regional council and we brought in some very different types of proposals. One of them was a pay-as-you-go proposal. I can honestly stand here today and tell you that some of the laws that we passed in 1982 which I had a great deal to do with have meant that today that regional municipality is out of debt, and so is the city.
Do not start insulting just everyone generally. Many of us are very fiscally responsible, whereas on your side you may pretend to be, but you are not. Which one of you has ever had that kind of a record? All you have is a deficit that doubles. You have to be very honest, this is a sham. This is a sham.
I will go back to to 1988 before the last election. That would have been a time to bring in tougher monetary policies. That would have been a time to start curbing inflation, but no, no. The people across the way were far more interested in winning elections, so they went on a wild spending spree.
What is to stop them from doing that now? What is to stop you from doing that now? Who knows? They will do it again. They will find a way around it. That is what they did in 1988. Not only that, but in 1988 they said to Canadians: "We are going to give you a tax break. We are going to give you a tax break". So they gave everybody a tax break.
It was great for getting re-elected. It did absolutely nothing for what was coming. They did not even get elected because of that. They got elected because of the free trade and the massive advertising by a third party that scared a number of people into voting and that is a very dangerous thing. I will not get into that one now.
If they had been a little bit more conscious of doing the right thing, they still might have won that election and we would not be in this-


Dennis Joseph Mills: Oh, don't say that.


Diane Marleau: Hopefully, they would not have, but they did. What I am saying is the free trade argument was there anyway at that time. If they had been a little bit more careful, and if they had done a little bit more of what they always go on about doing, then perhaps we would be in a better condition today and perhaps they would not need to bring in this nonsense-type of legislation. Who are we kidding?
Look around. Go around the country and ask people. One fellow here was reading letters from some of his constituents. Sure, people want us to control our spending. But do you know what? They want to get value for their money, not just to give jobs to their friends and generally pass it around to those who support them. They want to get value for their money and not just to be paid lip-service to by passing laws somewhere that really will not do a heck of a lot for anybody because there are too many loopholes around it.
The hon. member says it has been part of our system for years. Why should we not change the system? I am convinced that we can change the way we do things and get value for our money. Again, as I say, why does it have to be 3.8 per cent? Why not 3.2 per cent? Why not 2 per cent?


Mr. Epp:: Keep on going another 10 minutes.


Diane Marleau: I am going to give the hon. member a chance to ask me questions and comments. He is enjoying this so much, I am so pleased. I would not want to stop the enjoyment he is having out of this. But he can enjoy now, he will not enjoy later. He will be quite happy if we bring in some more dollars for training because many of them are going to need retraining.


Donald Alex Blenkarn: Spend more money now.


Diane Marleau: In certain areas, why not? Who says that a certain program should not have more money spent? Who says that certain programs should not be cut off completely? Who says that? Who has said that all of these programs that are in place are the greatest and the best? There are many that we could change.


Mr. Dorin:: Which one will you cut?
February 18, 1992


Diane Marleau: The refugee determination board is one of the great ones. This is where all the friends of Conservatives now have jobs. They have great, big high-paying jobs. They are not getting the backlog dealt with any faster. It would be a good way to start.
There are ways. Believe me there are ways. There are other areas where we should spend more money. Never mind, we will do a very good job, far better than they have been able to do in the last eight years. I have every confidence.
Seriously, we do have to look at managing our finances better. I will agree that it is not an easy answer. I want to get serious here. We all have to work at this together.
It is not by bringing in a piece of legislation that we are going to change it. We are only going to change it by each and every one of us working together, starting with us at the top. None of this imposing things.
We start with ourselves at the top and perhaps come out with a smaller, leaner cabinet. Think of the money we could save there. Think of the message that it would give to Canadians to have a much leaner type of operation.
If we think in terms of office space, every cabinet minister has to have an office in the ministry office and then he has to have an office on the Hill. Of course, he can never be at two offices at the same time so he also needs a chauffeur to keep him going between offices and between meetings. Just think about it, just the simple act of streamlining the cabinet what that could do. Then go on from there. You streamline your departments. With the way it works right now in departments, the more money you spend, the bigger you are, the more clout you have.
What about streamlining all these people into one group? There are ways of doing things very well. They are not easy. It is not a cap on spending such as this that is going make us do the kinds of things we have to do. We all have to do some serious thinking about what we are going to cut, not just say we should have an increase of 3.8 per cent or 3.2 per cent. I have said it before and I will repeat it-
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The Acting Speaker (Mr. DeBIois):: Order, please. The hon. member's time has expired.


Murray Dorin: Mr. Speaker, I would like to take this opportunity to comment on the member's address and perhaps ask her a question.
She made a reference earlier in her speech to the fact that the government had raised the spending limits under the bill tabled last week from what they were under the proposed act. I would like to point out to her what in fact occurred. When the finance committee undertook to examine this bill it suggested that self-financing programs, those such as unemployment insurance where the premiums pay for the programs, should be very carefully defined so that there could not be a lot of exclusions such as adding a new tax to build new highways and calling that a self-financing program.
We called for a strict definition of self-financing programs. In response to that recommendation the government limited the number of self-financing programs to four, meaning that all those others were then added under the spending control act, making the bill tighter. That was a recommendation of the finance committee which was endorsed by the member's party. I am wondering why she would now oppose the fact that the government has done what was asked by the finance committee, even though the result has been that more spending has been brought under the spending control act. Why would she oppose what her own member has recommended and was quite strong in supporting during the committee process?


Diane Marleau: Mr. Speaker, my problem with the whole bill is that it is a big game. It is smoke and mirror thing. It does not really matter what kind of fancy footwork and what kind of fancy things are done with this bill. It is not going to do what they would like it to do.
To do that they need the will of everyone to work together and to spend the money in the wisest possible way, every dollar they have including the dollars needed to service the debt. They have to take advantage of every saving and they have to remember that they are dealing with people.
These are very difficult times. We hear about what is happening in the Atlantic provinces. We hear about what

February 18, 1992
Adjournment Debate
is happening to our fanners. We hear about what is happening in the resource sectors. We hear about what is happening in southern Ontario in terms of the manufacturing sector. All these problems cannot be dealt with by using a bottom line mentality. It just does not work.
They have to go over every dollar spent to make sure it is spent in areas where it is most needed. That is what is the most important. We do not need rhetoric about spending more in training being irresponsible. I do not think it is being irresponsible to help people retrain and prepare themselves for the future, prepare themselves to become very productive members of our Canadian society.
Investing in our future is not a waste of money, even if investing in that sector means we would have to go over the particular amount here. Maybe there is a payback and the payback would really help to bring down the deficit. How do you know that?
I like to believe that an expanding economy and expanding employment mean that more tax revenues come into the pot and therefore we are able to reduce the deficit, more so than by turning and cutting everybody off and saying: "Sorry about that. Don't get retrained. Don't do anything. We will keep you on welfare".
How does that make for a productive economy? How does that make for more taxes and for less deficit? I want to know because in my way of thinking it is only by working together and ensuring the people in our country get the best treatment possible that we can come out of this mess and be a much stronger, more united and more productive country.


The Acting Speaker (Mr. DeBIois):: I wish to report that the first five hours of debate are now over. When this bill is again debated in the House, we will move to the period of 10-minute speeches without questions and comments.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Ron J. Duhamel: Mr. Speaker, I am delighted to be given the opportunity to attempt to seek more information on a couple of questions that I had raised previously.
Some of my colleagues will recall that I asked the Minister of State for Youth, when he announced his program for school dropouts, whether or not comprehensive evaluation programs had been undertaken, had been planned or were about to be initiated so that we could determine whether there would be more people working as a result of this initiative.
The minister gave an answer that was less than satisfying, and that is why I am here this evening. To be fair, the minister did supply some additional information, but it is not the kind of data that I require in order to be able to answer that basic question.
The other question that has never been answered is whether or not this school dropout initiative was actually new money or whether it was money that was taken from another program thereby reducing it. Frankly that is the government's prerogative, but it should tell us and tell Canadians whether or not that is so.
My colleagues will perhaps recall that there was a very similar supplementary question asked of the government's literacy initiative. I basically asked: "Do you have any hard facts to indicate whether or not there are more or fewer literate students today than when you began this initiative?" Lo and behold, it was a tough question because the minister responsible for that program did not happen to be in the House on that day and, to be fair there again, he supplied some additional information. Again it was not the right kind of information.
The question is a very simple one.

I will ask it in both official languages of Canada to be absolutely sure that I am understood. You began two projects. Good, no problem with that. Now, did you set
February 18, 1992

up evaluation mechanisms so that we can know whether or not this extra spending means that fewer or more young people have been able to find work and whether fewer or more Canadians can do arithmetic, read and write more easily than they could before. That is what I wanted to know. That is what Canadians want to know.

When we talk about program initiatives in a period of tight money, where there is a recession, where every single dollar counts, where we are undertaking initiatives, I hope, to get people back to work, we have to be absolutely certain that we are getting our money's worth.
Therefore, I had questions on both the school dropout program and on the literacy program. I wanted to know: Is this new money for the school dropout program? Are there evaluative mechanisms in place that will tell us whether or not these young people, potential dropouts, have new jobs, better jobs and significant jobs? Is it working? Likewise with the literacy initiative. Are there fewer functionally illiterate Canadians as a result of this?


Marcel R. Tremblay: Mr. Speaker, on behalf of the Minister of State for Youth, I am pleased to tell you about the plans to evaluate the government's initiative for fighting the school dropout problem.
It has been clearly established that a higher level of education leads to better jobs.
The government is preparing to evaluate the program part of "School First". "School First" is in three interrelated parts and is meant to reduce the school dropout rate, which is about 30 per cent in Canada.
First, the part to mobilize the various interest groups seeks to involve business people, unions, educators, social workers, non-government agencies, parents and young people themselves in helping to find solutions for the school dropout problem.
The public awareness part is intended to provide the public with information on the school dropout situation in Canada and its harmful effects on our economic prosperity.
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Finally, the program and services component is to support direct and indirect approaches to encourage young people at risk to remain in school.
The government is working with the provinces to develop common methods to determine to what extent the dropout rate is reduced by our initiatives together with those of the provinces.


PORNOGRAPHY
Bill Attewell: Mr. Speaker, tonight I want to discuss a crucial issue that is having a major impact on Canadian society. The issue is hard core pornography and the degradation and violence inflicted on women and children.
Many violent crimes, including wife battering and the sexual abuse of women and young children, can be traced to readily available hard core pornography.
Studies on the effects of hard core pornography have been consistent in their findings. The studies conclude over and over again that pornography affects men's attitudes about sexual aggression toward women.
Hard core pornography is dangerous. It exploits innocent children and women. I was shocked to learn that children are one of the primary consumers of pornography. A national survey recently showed that 38 per cent of male and female children between 11 and 17 years old reported watching pornography at least once a month.
A later survey of grade 9 students by Professor Check showed that 80 per cent of them had watched pornography. The average age of first exposure to pornography was 12.
The pornography industry is powerful, aggressive and committed to the exploitation and subordination of women and children.
Detective Sergeant Gary Colangelo heads up the morality branch for the York Regional Police Force. Pornography is one issue his branch investigates.
The one adult-only video store in Markham, which opened fairly recently, had copies of two videos that members of the morality branch decided were pornographic. The two videos have since been removed from the shelf.
A Criminal Code provision currently makes production, distribution and possession for distribution of obscene publications a crime. There is presently no legal

February 18, 1992
Adjournment Debate
definition of pornography. Instead, offensive materials are defined by the imprecise term "obscene", making it difficult for Canadian police officers to enforce.
Police officers insist they can make little headway in reducing the widespread incidence of hard core pornography if the federal government does not introduce effective and forceful legislation.
Several months ago I wrote to over 40 ministers and rabbis in the riding about the problem of hard core pornography. I explained my plans and invited members of their congregation to have friends and neighbours sign a special petition I prepared to call on the government to eliminate the production and distribution of hard core pornography.
Members of several churches participated, including St. Andrew Presbyterian Church, Unionville Alliance Church, Thornhill Presbyterian and Gormley Missionary Church.
In conclusion, I am calling on the Minister of Justice to introduce a strong bill to curb pornography. Its implementation is crucial to our nation's already fragile moral fabric.


Mr. Rob Nicholson (Parliamentary Secretary to Minister of Justice and Attorney General of Canada):: Mr. Speaker, the hon. member for Markham-Whitchurch-Stouffville has asked the government to address the issue of hard core pornography by bringing in strong legislative measures to conquer this problem.
This is a matter of great concern to the hon. member and I would like to point out to the House that the hon. member has been one of the champions of this cause, I believe, ever since his entry into federal politics in 1984.
He is aware, I am sure, that many Canadians share his view that the availability of such materials is a contributing factor to violent crimes, including incidents of family violence and the sexual abuse of children and women.
The question of pornography, especially violent pornography, and whether it is associated with crimes against women has been the subject of numerous studies.
As well, the hon. member is aware that in the last few years the federal government has made several unsuccessful attempts to amend the criminal legislation regulating pornography. The most recent attempt to change the law was Bill C-54, which died on the Order Paper in 1988. Bill C-54 was contentious and was condemned by a number of groups, including literary and arts communities, libraries and civil liberties associations. However, despite this controversy, I believe there is unanimous support for stronger legislation regarding pornography involving children and violent pornography.
As has been stated previously in this House, the government intends to introduce legislation during this session of Parliament directed at prohibiting child pornography to prevent the sexual exploitation of children and to protect them from harm. I know that will receive the support of the honourable member and of all members of the House.


UNEMPLOYMENT INSURANCE
Ms. Catherine Callbeck (Malpeque):: Mr. Speaker, in a recent statement to the House, I called on the federal government to listen to the pleas of small business people. I called on the government to reduce the barriers to economic recovery that this government has put in place and that are preventing small businesses from leading us out of the recession. I called on the government to abandon its high tax policies such as increases in unemployment insurance, policies which are crippling our small business.
Small business growth was a major contributor to our last economic recovery in the 1980s. Unfortunately, small business, along with all Canadians, has lost total confidence in the ability of this government to handle this recession. The symptoms of this lack of confidence are obvious. There is simply a lack of consumer spending. We have an unemployment rate of 10.4 per cent. Our bankruptcy rate continues to increase; it is up 37 per cent from 1990. Canadians are reluctant to spend due to the uncertainty of their job status.
In my province the unemployment rate remains high, at 16.9 per cent. There is little sense of recovery at this moment in my province of Prince Edward Island. The unemployment rate continues to increase every month. The bankruptcy rate increases. Potato farmers have suffered some of their toughest times in our history. Our dairy, poultry and egg farmers are watching nervously as
February 18, 1992

this government appears to be weakening its commitment to strengthen article XI and preserve our supply management system. Free trade and world restructuring appear to be leaving Canada behind.
Look at the recent layoffs in Atlantic Canada. New announcements have included Hibernia, Sears, Stone Consolidated, pulp and paper mills, Dominion Textiles, Rio Algom, Saint John Shipbuilding, Maple Leaf Mills, Coca-Cola, Iron Ore of Canada, Imperial Oil. The list goes on and on. That is a list of recent announcements in Atlantic Canada and it alone represents over 4000 jobs.
The Canadian Federation of Independent Business said in a recent brief: "The missing link is a resurgence of business and consumer confidence, both of which are powerfully affected by the actions of government".
The Atlantic Provinces Economic Council is calling for direct stimulus from the government in the form of increased spending on infrastructure projects. Many of the provincial premiers have called on the federal government to take action to stimulate a rebound in consumer confidence.
Our leader has outlined an economic plan that would help speed up the recovery. I would like to note that the plan of my party does not call for a wholesale increase in the deficit. In fact, the plan defines where the funding will come from to implement the proposals.
It is time for a concerted effort to get the economy moving again. Next Tuesday's budget must provide the needed boost in confidence to get consumer spending moving again and to put Canadians back to work.
Next Tuesday, Canadians will be looking to the budget for hope. For the sake of all of us, I certainly hope that this budget-


The Acting Speaker (Mr. DeBlois):: Order, please.


Mr. Jack Shields (Parliamentary Secretary to Minister of Employment and Immigration):: Mr. Speaker, my hon. friend in her question to the minister and in her comments tonight indicated that the unemployment rate is very high in her province of Prince Edward Island.
Indeed, unemployment is too high in Canada from coast to coast. We all recognize that. For her to go on and indicate that this is a made-in-Canada recession that we have come through-and signs are coming
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forward that we are coming out of the recession, we know that-is totally misleading to the House.
One of the things that I would like to point out is that if my hon. friend was to read the headlines of newspapers from the United States, from Germany, from France, from Holland and from Great Britain, if she did not know which newspaper she was looking at, she would find that the headlines and comments are basically the same in all of those countries.
The thing I am trying to point out is that this is a world-wide recession that we are going through and Canada is coming out. Canada cannot come out of this recession as my hon. friend has suggested and wholesale intervene in the economy. What we have to do is get our deficit and debt under control.
As soon as we are able to do that, then the world investor confidence creates the inflow of capital into this country that is so desperately needed to create the kinds of jobs that my hon. friend is talking about.
Once international confidence has been restored in the Canadian economy-and we have seen that in the past and we will see it more after the budget-and once that happens, then we will see consumer confidence also take hold. When that happens, jobs will be created in this country and we will be on the road to prosperity the way we should be.


NUCLEAR VESSELS
Mr. John Brewin (Victoria):: Mr. Speaker, on November 6 I raised a number of questions in the House about the three Orders in Council which the government introduced in the past and announced publicly on October 30, 1991.
The Orders in Council consented to the transit through Canadian waters of U.S. and British nuclear-propelled vessels, consented to U.S. and British vessels that are capable of carrying nuclear weapons to pass through Canadian waters and visit Canadian ports, and consented as well for U.S. nuclear-propelled submarines to pass submerged through Canadian waters at the Dixon entrance. The answers given by the Associate Minister of National Defence were, I submit, completely unsatisfactory.
In 1991, the Department of National Defence proposed that Orders in Council be used to consent to these various visits and passages through Canadian waters. Under the federal EARP guidelines, this request went to Environment Canada and a memorandum was prepared

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Adjournment Debate
dated August 28, 1991 by David Barnes of FEARO, the government office that is responsible for reviewing these proposals.
In the course of the memorandum, which was approved by the director general of operations at FEARO, he said: "National Defence's reluctance to conduct an initial assessment under the EARP needs to be questioned. It has come to our attention that the United States conducted an environmental review with extensive public involvement of an acoustic testing facility for nuclear submarines to be located at Behm Canal, Alaska, notwithstanding the obvious defence-related sensitivity of that facility. If such public consultation was possible for the United States in that situation, should it not be possible for Canada to do the same in this case before National Defence takes its decision?"
The recommendation of FEARO was that EARP applies to the decision to authorize the port visits and that National Defence is the initiating department. In the view of FEARO the process should be followed.
The decision of this government to go by way of Order in Council avoids a public process which is essential to the confidence that the people in my constituency of Victoria have in the visit into our waters of nuclear powered vessels and vessels which are capable of carrying nuclear arms.
If any other member of this House contemplated the building of a nuclear power plant in his or her constituency without a single public inquiry into the event, there would be hell to pay. That is precisely what this government has consented to in this case.
It is this which the people of Victoria and the people of our region object to. As a result of the government action, a lawsuit has been launched to challenge the government's opinion. It is totally inappropriate when the government has the kind of advice it has from FEARO that it should put citizens in this country through the requirement of testing these positions in court.
I call on the government to say today that it is willing to have a public review of the environmental consequences. The government says there are no problems here as a result of 20 years of looking at this. I say the time has come for the government to come out publicly
and present its case and to give the people of Victoria and of our region an opportunity to speak on it.


Mr. Patrick Boyer (Parliamentary Secretary to Minister of National Defence):: Mr. Speaker, the member for Victoria raises a very significant and sensitive issue, the passage of nuclear propelled submarines through Canadians waters. The Canadian government policy is very clear. It is founded on two principles: first, the preservation of Canadian sovereignty and second, the security of our environment.
I do not accept the interpretation that the member for Victoria is placing with such vehemence that the government is refusing to have any hearings into this whole issue because pursuant to the June 1990 cabinet agreement on the environmental assessment on policies to which he has referred, National Defence conducted a review of the potential environmental impact of the policy to allow these visits that he is referring to on our west coast.
Environment Canada reviewed the assessment at the request of National Defence and External Affairs. Environment Canada was satisfied with the conclusion that environmental impacts of these visits would be insignificant. Moreover, the results of those inquiries are public and the documentation to which the member refers, as if it was some document he had obtained in an amazing fashion, are public documents.
This is something that I can certainly say as a parliamentarian, and as a member of this government, we want to have the public involved in. We want the Canadian people to be satisfied that the risks that are potentially there are being addressed. That is why for 20 years since the previous Liberal government initiated this policy in 1967 about port visits, we have done these things.
We have monitored. In fact it is the monitoring program that has brought to our attention just last Ihesday the collision of a U.S. submarine allegedly in Russian waters with a Russian submarine. These things are significant. We are keeping a close watch on it. The public interest is certainly being served as it must continue to be.


WESTERN GRAIN TRANSPORTATION ACT
Mr. Len Taylor (The Battlefords-Meadow Lake):: Mr. Speaker, on February 11, just a couple of days ago, I rose in this House to ask the government a question relating to the Western Grain Transportation Act, the decision of the Supreme Court on the Oldman case and the oppor-
February 18, 1992

tunity that it gave to the federal government to be involved in an environmental impact assessment of possible changes to the Western Grain Transportation Act.
I was looking for a response from the government that would indicate that it was going to take its previous statements and the decision of the court seriously and announce that an environmental impact study would be announced. I am quite concerned that if past practices are anything to be concerned about, then Canadians have to worry about the future of grain transportation in Canada and the impact that changes like that would have on our environment.
The question was posed to the Minister of Transport and the supplementary to the Minister of the Environment because, according to the Supreme Court decision, the Minister of Transport would be primarily the minister of responsibility here, given that any changes to the act would be initiated through the Minister of Transport.
My concern stems from the fact that the Minister of Agriculture has begun a process of public meetings throughout western Canada in which farmers and interested community individuals can discuss the future of grain transportation in Canada and possible options for change to the Western Grain Transportation Act.
Obviously, if there are options on the table for change, then there must be consideration being given by the government to make some changes. The majority of producers on the prairies who have attended those meetings have indicated that they want no change; the Western Grain Transportation Act, the Crow benefit, the status quo, must be maintained in order to facilitate the orderly transporting of grain to port from the elevators. They have called for some efficiencies in the system, such as ensuring that the lowest possible cost from the farm gate to the port be considered.
They have expressed some concern about the environment. Recently in the green plan the government indicated that policy decisions of government such as changes in legislation should be subjected to an environmental assessment. Most recently, on January 23 of this year, the Supreme Court of Canada indicated that an
Adjournment Debate
environmental assessment is a planning tool that is now regarded as an integral part of sound decision making. The earliest part in the process should be the environmental impact assessment.
I want the government to carefully consider the environmental consequences of changing the Western Grain Transportation Act before it takes steps to change the act. That would be the sound decision-making process. I feel that perhaps the opposite circumstance is being followed, that the decision to change the act has been made and later an environmental impact assessment would be followed.
I do not know the impact on the environment as a result of changes to the Western Grain Transportation Act, but I am concerned because grain moving by truck instead of on the rail would be a significant environment detriment.
I ask for clarification, and more important, I ask that the environmental impact assessment be done.


Patrick Boyer: Mr. Speaker, the member for The Battlefords-Meadow Lake has raised an important issue here relating to an issue that goes back through the whole development of the Canadian west, and that is the movement of grain.
When I was a newspaper reporter in his constituency, back in 1966 at the News Optimist in North Battleford, I learned a lot about the history of grain handling in the west. I hear him say, although he is a member of the New Democratic Party, that he is standing four square to maintain the status quo. I also hear him saying that he is concerned that public meetings are being held in western Canada relating to this issue. I would have thought, and it is certainly the view of the government, that consulting with the people is a very appropriate thing to do for any government looking at the long term interests of Canadian wheat producers and, moreover, other industries and activity that should be developing in western Canada such as greater milling and activity relating to the agricultural products in the west rather than having them shipped to my constituency where there are a lot of milling operations, bakeries, and so on.

February 18, 1992
Adjournment Debate
The maintenance of the status quo is not necessarily in the best interests. That is why this government is looking at and set up in 1990 the transportation committee on agrifood policy. That review has looked at changes to the Western Grain Transportation Act on land use, land values, transportation, and the environment as well. The green plan applies here. That is why this environmental impact is being looked at and remains a cornerstone of this current review. No decision is going to be made until this process of discussion, these meetings, are concluded. I want to reassure the hon. member from The Battle-fords of that.
Certainly it is not beyond the capacity of the people in this country to meet and discuss these problems, to look
at the environment, the issue that lies behind that, which is maintenance of the status quo, and in this case perhaps even using the environmental argument as a means of maintaining the status quo. There are big issues at play here. That is why the government is taking a leadership role in seeing that they are addressed in conjunction with the producers and the citizens of western Canada.


The Acting Speaker (Mr. DeBlois):: The motion that the House do now adjourn is deemed to be adopted. The House therefore stands adjourned until 2 p.m. tomorrow, pursuant to Standing Order 24(1).


[Stage Direction]
The House adjourned at 6.30 p.m.
[Stage Direction]
Wednesday February 19,1992